Raphael Stevens

Volkswagen and Stellantis blamed the chip shortage for their disappointing results.
“It was a challenging quarter,” VW CEO Herbert Diess told CNBC’s “Squawk Box Europe” Thursday.
“Our volume brands suffered most because of semiconductor supply,” Diess said, referring to Seat, Skoda and Volkswagen.

The underbody of an ID.3 electric vehicle is assembled at a Volkswagen facility in Dresden, Germany, on January 29, 2021.
Matthias Rietschel | picture alliance | Getty Images

LONDON — The global chip shortage is continuing to wreak havoc on the automotive sector, with several of the world’s biggest carmakers blaming the crisis for disappointing financial results this week.
Volkswagen and Stellantis said Thursday that the ongoing semiconductor shortage remains a major problem for them.

“It was a challenging quarter,” VW CEO Herbert Diess told CNBC’s “Squawk Box Europe” Thursday.
“Our volume brands suffered most because of semiconductor supply,” Diess said, referring to Seat, Skoda and Volkswagen.
In comparison, Porsche and Audi (Volkswagen’s premium brands) have been “quite resilient,” Diess said, adding that they’ve delivered positive results.
With no end in sight, the semiconductor chip shortage is now expected to cost the global automotive industry $210 billion in revenue in 2021, according to consulting firm AlixPartners.
From a geographic perspective, Diess confirmed that VW’s China business has been disproportionately affected.

“China really suffered,” he said, adding that VW lost market share in the country.
The group prioritized its premium brands in China and “compromised” on volume sales, Diess said, adding that the VW brand “suffered a lot.”
The German carmaker cut its outlook for deliveries, toned down sales expectations and warned of cost cuts as it reported lower-than-expected operating profit for the quarter.

Not all bad?

But Diess claimed that it’s not all negative. “The demand side is really good,” he said. “We have filled order books in all areas and our EV [electric vehicle] sales are coming along well.”
“We had to reduce our sales outlook but revenue outlook is still positive and [it has been] significantly growing over the last year,” Diess said. “That means we can keep our margin guidance, which is very important.”

Diess is optimistic that semiconductor supply will pick up in the next quarter, but he still expects to see some supply constraints in 2022.
“We foresee that semiconductors will be bottlenecks in our supply chain,” he said. “There might be others as well, but mostly we will see semiconductor constraints.”
Elsewhere, Stellantis — formed through the merger of Fiat Chrysler and France’s PSA — has also been hurt by the chip shortage.
Like VW, it also missed analyst expectations when it reported its third-quarter results Thursday. It reported a 14% fall in third-quarter revenue on a pro-forma basis after semiconductor shortages cut planned quarterly production by 30%, or 600,000 vehicles.
“The level of chip shortage was probably slightly higher than what we had expected when we last spoke to the market in August,” Chief Financial Officer Richard Palmer said, adding that the full-year total of lost production due to the chip shortage would top a previous forecast of 1.4 million units.
But Palmer said the business has seen a “moderate” improvement on the chip supply situation this month compared to September. He expects the trend to continue through the fourth quarter.
“Visibility on semiconductors continues to be a difficult subject for the industry,” Palmer added.
Analysts at JPMorgan and UBS believe now is the ideal time for investors to increase their exposure to the automotive sector.
“Time to increase the exposure to auto stocks, in our view,” said a UBS analyst team led by Patrick Hummel in a note on Oct. 8.
JPMorgan’s head of European autos equity research, Jose Asumendi, told CNBC Wednesday that he and his team have been telling investors to increase their exposure to autos for around a month.
“We are quite selective in terms of where we see value,” Asumendi said, adding that Daimler, Renault and Stellantis are the bank’s top stock picks among the European carmakers.

GM and Ford

On the other side of the Atlantic, U.S. carmakers GM and Ford managed to beat analyst expectations despite the chip shortage.
Ford surprised industry watchers Wednesday when it shattered Wall Street’s earnings expectations for the third quarter and it said it has already benefited from improved supply of chips.
Meanwhile, GM CEO and Chair Mary Barra said during a call Wednesday that the automaker’s supply of semiconductor chips is improving, but “it still continues to be somewhat volatile.” She said GM expects the shortage to continue into the first half of next year.
While many car companies have been posting disappointing results, chipmakers have seen their revenues soar as many of them increased the prices of the products.

The chipmaker view

France’s STMicro, which makes chips for the likes of Tesla, delivered strong third-quarter results Thursday and it expects the next quarter to be even better thanks to demand from the automotive market.
“We want to be a leader in the field of automotive,” STMicro President Lorenzo Grandi told CNBC’s “Squawk Box Europe” Thursday.

“We do believe that the situation in 2022 will really improve definitively compared to 2021,” Grandi said, adding that chipmakers were caught off guard when demand for automotive chips peaked at the start of 2021.
“The situation will improve in 2022,” he said. “I expect we will go back to a situation where you will have the right balance between inventory level, acceptable lead times, [but] not before 2023.”

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“We have to accept that Tesla sets the new benchmarks [on] … the EV side,” Herbert Diess says.
Back in March, Diess dismissed the notion his firm could join forces with Tesla, telling CNBC the German automotive giant was looking to go its own way.

A Volkswagen ID.4 on display at a press event in Germany on October 26, 2020.
Peter Steffen | picture alliance | Getty Images

The CEO of Volkswagen Group has praised Elon Musk’s Tesla and welcomed the fact there will be competition between the two firms going forward.  
Earlier this month, Musk addressed VW executives via video link after being invited to do so by Herbert Diess, who heads up the German automaker. Musk’s appearance was confirmed by Diess on Twitter and in a post on LinkedIn.

“I very much appreciate it that he showed up — I think we had a nice dialogue,” Diess, who was speaking to CNBC’s Julianna Tatelbaum on Thursday, said.
“And we have to accept that Tesla sets the new benchmarks [on] … the EV side,” Diess added. “Not only technology wise, but also when it comes to productivity, speed … I think it’s always good to have competition.”
The Volkswagen Group, which is pursuing an electrification strategy, is headquartered in the German city of Wolfsburg. Elon Musk’s Tesla is building its Gigafactory Berlin-Brandenburg in Grünheide, a few hours’ drive from VW’s base.

Read more about electric vehicles from CNBC Pro

“I very much appreciate that he’s coming to Germany,” Diess said. “He will challenge us, but we will try to follow as fast as possible.”
Diess’ comments were made after his firm posted earnings for the third quarter. Operating profit before special items dropped by 12.1% to 2.8 billion euros ($3.25 billion), with the German automaker citing “supply issues.”

In a statement, the company said: “The global semiconductor bottlenecks particularly impacted on the business performance of the Volkswagen Group in the third quarter.”
The shortage of semiconductors is not unique to Volkswagen. On Thursday, the Society of Motor Manufacturers and Traders said U.K. car production in September declined by 41.5% year-on-year.
“Output continues to be hampered by the production stoppages caused by the ongoing global shortage of semiconductors as well as the loss of production capacity arising from the closure of one of the UK’s larger plants,” the SMMT said.
A total of 67,169 cars were manufactured last month, the industry body said. This represented “the worst performing September since 1982.”
While overall output was down, the production of battery electric, plug-in hybrid and hybrid models accounted for 32.3% of cars made.
Electric goals  
Back in July, the Volkswagen Group said half of its sales were expected to be battery-electric vehicles by 2030. By the year 2040, the company said almost 100% of its new vehicles in major markets should be zero-emission.
A few months earlier, in March, Diess dismissed the notion his firm could join forces with Tesla, telling CNBC that the German automotive giant was looking to go its own way.
Speaking to “Squawk Box Europe” at the time, he was asked if he would rule out any future deal with Elon Musk’s electric car maker, in which VW could manufacture its cars, or if the Tesla and VW brands would ever unite.
“No, we haven’t considered [that], we are going our own way,” he replied. “We want to get close and then overtake.”

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“We think that we can – we need our own software stack, our own technology,” he added. “And also, I think Tesla, or Elon, is very much thinking … [about] his way forward. So no, there are no talks between Elon Musk and myself regarding joining forces.”
Volkswagen is one of several major automotive companies turning its attention to electric mobility. In July another German firm, Daimler, said its Mercedes-Benz brand would “be ready to go all electric at the end of the decade, where market conditions allow.”
—CNBC’s Chloe Taylor contributed to this report More

Five percent of unvaccinated adults said they have left a job due to a vaccine mandate, according to a survey released Thursday by the Kaiser Family Foundation. 
One-quarter of workers surveyed by KFF in October said their employer has required them to get vaccinated, up from 9% in June and 19% last month.
A nationwide vaccination or testing mandate covering businesses with 100 or more employees announced by President Joe Biden last month has yet to be officially implemented by the Labor Department.

People shout slogans against the government as they arrive to the City Hall in protest of COVID-19 vaccine mandate in New York City, October 25, 2021.
Eduardo Munoz | Reuters

Five percent of unvaccinated adults say they have left a job due to a vaccine mandate, according to a survey released Thursday by the Kaiser Family Foundation. 
This early read on whether workers will actually quit their jobs over mandates comes as more employers are requiring shots. One-quarter of workers surveyed by KFF in October said their employer has required them to get vaccinated, up from 9% in June and 19% last month. 

President Joe Biden announced in September a mandate for businesses with 100 or more employees to ensure workers are vaccinated against Covid or tested weekly for the virus. The mandate, which is currently still under review, is estimated to cover roughly two-thirds of the private sector workforce once it’s implemented. The Kaiser survey only asked whether people have quit over a vaccine requirement, not a vaccine requirement with a testing option.
More than a third of unvaccinated workers said they would quit rather than comply with a vaccine or testing mandate, the Kaiser survey shows, a share that jumps to 72% if no testing option is offered. But because the nationwide mandate has yet to be officially implemented by the Labor Department, it remains to be seen what share of workers will quit when a broader swath of the U.S. workforce is covered.
“Right now only a quarter of workers say that their employer has required them to get a vaccine, so it’s still quite hypothetical for these workers who say they would leave their jobs,” said Lunna Lopes, a senior survey analyst at the Kaiser Family Foundation. Still, Lopes said, the survey results offer “a sense of people’s attitudes” toward the requirements. 

Workers already covered by a mandate are more likely to have higher household incomes, identify as Democrats and already be vaccinated, the data shows. The survey results also illustrate the ongoing partisan divide toward Covid-19 vaccines, with 32% of Republican respondents reporting they know someone who has quit over a mandate compared with 14% of Democrats who said the same.
Kaiser surveyed 1,519 randomly selected American adults from Oct. 14 through Oct. 24.

U.S. business groups have pushed back against the forthcoming mandate, asking the White House to delay the rule until after the holiday season.
“We’re totally in favor of the vaccine, we’ve distributed the vaccine, we’ve spent millions incentivizing employees to get the vaccine,” said Ed Egee, who works on government relations and workforce development at the National Retail Federation, a retail trade association. But Egee said putting employers in the middle of a discussion that is “contentious and political whether we like it or not” is going to create significant implementation challenges, and risks the potential of staffing shortages heading into the holidays.
The NRF has asked the White House for a 90-day implementation period once the rule is finalized, Egee said, to allow time to verify employee vaccination status, consider requests for exemptions, and figure out plans for weekly testing.
When asked about survey data indicating a small share of adults have left their jobs over mandates, Egee noted there is likely to be significant geographic variation behind the national numbers. Employers in the South and Mountain West are likely to see higher rates of worker resistance, he said. 

The National Association of Manufacturers, in a letter to the federal government last week, said that losing even a small share of workers could have significant consequences for some of its member companies.
“At small facilities with barely more than 100 employees in particular, the departure of even one highly valued team member could lead to production challenges if not managed or planned appropriately,” wrote Robyn Boerstling, a top lobbyist for the manufacturers’ group. “For larger companies, even losing 1% of a production team could have operational consequences given the specialized nature of a skilled manufacturing worker.”
An internal survey from the American Trucking Associations estimates that carriers subject to the mandate would lose about 74% of unvaccinated employees, or 37% of their total workforce, to retirements, resignations, or employees switching to work for smaller companies not covered by a mandate. That survey assumes, however, that the share of respondents who said they would quit will do so when the time comes, the trade group said in a letter sent last Thursday to the Office of Management and Budget, which is reviewing the rule for the White House.
When asked whether drivers are actually leaving the workforce already, Jeremy Kirkpatrick, the association’s director of strategic communications, said that it’s too early to tell because the rule hasn’t been made public yet.
“We’re in a wait and see mode right now,” Kirkpatrick wrote in an email to CNBC.
The Kaiser survey also indicates that most unvaccinated workers would not quit outright if faced with a mandate. About 6 in 10 said they would be likely to apply for a religious, medical, or other exemption if their employer required them to get a vaccine.
“There’s a lot of options that people would try to exhaust before leaving a job,” said Lopes, the KFF analyst.
Nearly 58% of the U.S. population overall is fully vaccinated, according to the Centers for Disease Control and Prevention, including nearly 70% of adults.
— CNBC’s Spencer Kimball contributed to this report.

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Paige Montgomery with daughter Penelope
Paige Montgomery

Women have been disproportionately impacted by job loss during this pandemic, and mothers have been hit even harder. 
Since February 2020, the economy has experienced a decline of nearly 5 million jobs — and women account for 57.5% of those losses, according to the National Women’s Law Center. The financial impact has been devastating, especially for women with families.

Even before this global health crisis, the pay gap for mothers versus fathers was $15,300, according to the law center, meaning mothers had to work more than 16 months to make as much as fathers were paid in 12. For women facing additional financial insecurity due to the pandemic, some experts say it will be more difficult to afford the education and training that would allow them to advance. 
Many mothers seeking financial guidance don’t know where to turn. 
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Paige Montgomery, a 29-year-old single mom, was trying to get her money management back on track after a job loss — and a high risk pregnancy — had turned her finances upside down.
“I was on bed rest, and then ultimately was laid off because of Covid,” she said. “I had no savings.

“I was living literally paycheck to paycheck.” 
Sabrina Smith, 37 and also a single mom, said she struggled after being laid off, too. “I luckily had a little bit of savings to hold me over,” she said. “But then from there, I had to find other ways in order to pay my bills.”

Earlier this year, these mothers learned about a free program, called “Finances are Cool. Moms Are Cool,” offering financial counseling to a select group of mothers to help them rebuild what they’ve lost. The program was created by social media influencer Haley Sacks (known on Instagram as “Mrs. Dow Jones”) and Josh Brown, CEO of Ritholtz Wealth Management and a CNBC contributor.
Smith and Montgomery were among 10 mothers selected for the three-month course, which included a series of lessons — on retirement savings, life insurance, and investment strategies, among other topics, in virtual group sessions. Lessons were taught by three certified financial planners from Ritholtz Wealth Management — all women — who also provided one-on-one financial counseling. 

Sabrina Smith (L) walks with her sons

“Serving as a role model is something that, the ladies at my firm, maybe they didn’t expect, but it’s just one of those ancillary benefits that came along with running this program,” Brown said.
During the three-month course, Smith and Montgomery got back to work. Montgomery scored a full-time job as a marketing manager. Smith was hired back full time at the company that laid her off.  After their “graduation” ceremony this fall, these moms said they are feeling more confident about their finances

As mothers, we want to be superwoman all the time.

Sabrina Smith
“Finances are Cool. Moms Are Cool” participant

“The thing I learned the most was probably about my 401(k),” said Montgomery, who is now focused on building wealth for herself and her now one-year old daughter. “The class came at a perfect time, because the majority of my anxiety at that point was with my finances.” 
Smith said what she learned in the program also helped her relieve some of her stress around money. “Through the program, I decided that I needed to establish an emergency fund,” she said. “It really showed me, you need at least six months to a year saved up.”  
The financial guidance taught Smith a few things about motherhood, too. 
“As mothers, we want to be superwoman all the time,” Smith said. “You beating yourself up over your finances, it’s not going to make your finances grow any faster.
“Stop being so hard on yourself.” 

Tips will pay dividends for years

Getty Images

Both Montgomery and Smith say the tips they took away from the course are tools they’ll use — and share with their families. And the certified financial planners who worked with the group — CNBC Financial Advisor Council member Blair DuQuesnay, Dina Isola and Emily Johnson —  said they plan to continue to be resources for these moms for years to come.
This was the first group to go through the training, but Sacks and Brown plan to continue the free program for mothers who are facing financial hardship. 
For mothers seeking comprehensive financial advice, check out these free and low-cost resources, as well: 
Credit counselors may offer initial budget sessions for free. Find a non-profit counselor through the National Foundation for Credit Counseling. Non-profit organizations for financial advisors, such as the National Association of Personal Financial Advisors, the Financial Planning Association and Foundation for Financial Planning, have lists of financial planners or local groups on their websites who will provide pro bono advice.  
Tune in: Watch Sharon and the Halftime team at 12pm talk about this special financial counseling program for moms impacted by the pandemic 
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Disclosure: NBCUniversal and Comcast Ventures are investors in Acorns. More

Yum Brands topped Wall Street’s estimates for its third-quarter earnings and revenue.
The company reported same-store sales growth of 5%, falling short of StreetAccount’s estimates.
KFC’s same-store sales climbed 6% in the quarter.

Vehicles wait in line at the drive through lane of a Yum! Brands Inc. Kentucky Fried Chicken (KFC) and Taco Bell restaurant in Lockport, Illinois, U.S.
Daniel Acker | Bloomberg | Getty Images

Yum Brands on Thursday reported quarterly earnings and revenue that topped analysts’ expectations, fueled by strong demand for KFC’s fried chicken.
However, Taco Bell’s perforance was weaker than expected, and led to a shortfall in Yum’s same-store sales growth.

Shares of the company fell less than 1% in premarket trading.
Here’s what the company reported compared with what Wall Street was expecting, based on a survey of analysts by Refinitiv:

Earnings per share: $1.22 adjusted vs. $1.08 expected
Revenue: $1.61 billion vs. $1.59 billion expected

The company reported fiscal third-quarter net income of $528 million, or $1.75 per share, up from $283 million, or 92 cents per share, a year earlier.
Excluding items, Yum earned $1.22 per share, beating the $1.08 per share expected by analysts surveyed by Refinitiv.
Net sales rose 11% to $1.61 billion, topping expectations of $1.59 billion. Across all of its chains, same-store sales increased by 5%. Wall Street was expecting same-store sales growth of 5.8%, according to StreetAccount estimates.

The global spread of the Covid delta variant weakened demand for Yum’s pizza, chicken and tacos in some of its key markets. Some customers may have stuck to ordering their food to go. Yum said it is seeing sustained momentum in digital sales.
KFC’s same-store sales climbed 6% after falling 4% a year ago. While growth in China, its largest market, was muted during the quarter, its home market saw same-store sales climb 4%. On a two-year basis, U.S. same-store sales were up 13%.
Pizza Hut reported same-store sales growth of 4% as international markets bounced back. In the United States, its same-store sales rose by just 2% as it faced tough comparisons to a year ago. On a two-year basis, Pizza Hut’s U.S. same-store sales are up 8%.
Taco Bell’s same-store sales rose 5% in the quarter and 8% on a two-year basis. The chain has struggled to recover late-night and breakfast sales throughout the pandemic. The Mexican-inspired chain’s same-store sales had the biggest miss of Yum’s portfolio. StreetAccount estimates forecast that the chain would report same-store sales growth of 6.2%.
Yum added 760 net new locations during the quarter, setting a record for the company.

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Ronald Koeman sacked by Barcelona after 14 months in charge with club ninth in La Liga after just four wins from 10 games.
Koeman replaced Quique Setien at the Nou Camp in August 2020.
He won Copa del Rey in his first season.

MADRID, SPAIN – OCTOBER 27: Ronald Koeman, head coach of FC Barcelona looks on before the La Liga Santander match between Rayo Vallecano and FC Barcelona at Campo de Futbol de Vallecas on October 27, 2021 in Madrid, Spain.
Denis Doyle | Getty Images Sport | Getty Images

Ronald Koeman has been sacked as head coach of Barcelona after 14 months in charge.
After weeks of speculation, Koeman’s final game was the 1-0 defeat by Rayo Vallecano in La Liga on Wednesday night, their fourth defeat in six games in all competitions.

A brief statement was released on the club’s website confirming president Joan Laporta had relieved the Dutchman of his duties as first-team coach.
It added: “Ronald Koeman will say goodbye to the squad on Thursday at the Ciutat Esportiva.
“FC Barcelona wishes to thank him for his service to the club and wishes him all the best in his professional career.”
Pressure had been building on the Dutchman since a 3-0 defeat at Benfica in late September, which made this season the club’s worst-ever start to a Champions League campaign.
They succumbed to a 2-0 away loss to Atletico Madrid in La Liga on October 2, with former forward Luis Suarez scoring the second goal at the Metropolitano Stadium, and they trail league frontrunners Real Madrid by six points in the table.

Their 2-1 loss to Real Madrid at the Nou Camp on October 24 was Koeman’s third El Clasico defeat in a row, and after the final whistle, the Barcelona boss was targeted by a crowd of fans who attacked his car as he tried to drive away from the stadium.

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After the defeat on Wednesday, Koeman said: “It [Barcelona’s league position] says we’re not well.
“The team has lost balance in the squad, lost very effective players, which shows. In recent years other clubs have strengthened every season and we haven’t, which also shows.”
Koeman was appointed in August last year and in his first campaign led Barcelona to third place in La Liga and won the Copa del Rey.
But he has struggled in his second season following the departure of Lionel Messi, who left as a free agent in the summer to join Paris Saint-Germain with financial issues leaving Barcelona unable to afford his wages.

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