Business

When Donald Trump left office three years ago, still huffing, puffing and plotting to overturn the results of the 2020 presidential election, the leaders of most of America’s biggest corporations were only too happy to see the back of him. They wore their moral outrage like a badge of honour. Sure, they had conveniently put aside their earlier scruples about Mr Trump’s suitability for the White House, bought off by generous corporate and personal tax cuts in 2017. Sure, many had cravenly turned a blind eye to his torching of environmental rules in support of a broad-brush regulatory bonfire. But his attempts to subvert American democracy, and the storming of the Capitol by his supporters on January 6th 2021, were a step too far.With unusual unity, they huffed and puffed back. Manufacturers called the riots a “disgusting episode”. The Business Roundtable, a lobby group for big companies, called on Mr Trump to “put an end to the chaos”. Some prominent firms pledged not to provide financial support to the 147 Republican lawmakers who had refused to certify Mr Trump’s defeat.Mr Trump’s runaway victory in the first bout of the Republican primary contest in Iowa on January 15th cemented his status as the party’s presumptive nominee. The polls suggest that in a head-to-head battle with President Joe Biden, he would win. But if there are murmurings of alarm about what a sequel to his chaotic presidency might mean for corporate America, this time they remain behind closed doors. Recently Larry Summers, the pro-Biden former treasury secretary, urged CEOs to reject Mr Trump, noting that Italy’s markets did well in Benito Mussolini’s first few years in power—until they didn’t. Yet for the moment, most advisers and leaders of business associations counsel bosses to keep their heads down. Forget Il Duce. The message is: duck and cover.There is rationale for lying low. For a start, with ten months to go before the elections, anything can happen. Health issues could force either candidate out of the race (combined, Messrs Biden and Trump have had 158 years on Earth, nearly two-thirds the age of America itself). Mr Trump has not only his Republican rivals and Mr Biden to contend with, but 91 felony counts across two state courts and two federal districts. Staking out the moral high ground from corner offices may also be counter-productive. It could backfire on those who attack Mr Trump in public, and bolster his anti-elite appeal. In office, he was quick to retaliate when attacked (preferred weapon, CAPITALISED TWEETS!). With trust in big companies on the wane in recent decades, it has become easier for populists to whip up an anti-business hue and cry. The head of a prominent business organisation ruefully admits that if he took a public stand against Mr Trump’s campaign proposals, “the former president would be delighted.”In the past few years, as the relationship between big business and Mr Trump’s MAGA Republicans has soured, executives have learned the hard way the risks of sticking their necks out. A public-relations adviser to CEOs thought a year ago that it would be relatively easy for business to disown Mr Trump because of his legal travails. But then came the unofficial boycott of Bud Light, a beer, by right-wing culture warriors offended by its marketing campaign with a transgender influencer. The PR man realised the power of the mob to hurt the bottom line. “We are back to walking on eggshells,” he says—caught between progressive employees and customers demanding that firms take a stand against Mr Trump, and fear of the MAGA masses.Then there is Mr Biden. When pushed to express a preference, many businesspeople say they see him as a steadier pair of hands in policymaking and geopolitics. But they are fed up with his administration’s anti-business rhetoric (Gina Raimondo, the commerce secretary, is an honourable exception). That makes them more tolerant of Mr Trump. Of the two, Mr Biden is “hands down a bigger threat to prosperity”, says a billionaire financier.Even Mr Biden’s backers rail against the ”big is bad” stance of his trustbusters. Those trustbusters’ bite has not been as bad as their bark; many of their cases have failed in court. But the bark alone has chilled dealmaking, laments an investment banker. As for the risk that Mr Trump could “weaponise” administrative agencies against his corporate enemies, Neil Bradley of the US Chamber of Commerce counters that Mr Biden, too, has urged his administration to crack down on “junk fees” and price-gouging in industries ranging from airlines to banking and health care. Mr Bradley draws few distinctions between either party’s economic populism.Some businessfolk angrily dismiss efforts to draw parallels between the dangers of Mr Trump and Mr Biden. Calling it “whataboutism”, they quietly profess to be terrified by the prospects of a second Trump administration. In the first one, the former president may have pushed radical policies, but sensible conservatives in his administration, as well as his own predilection for chaos, got the better of him. Now he is surrounded by true believers, such as the Heritage Foundation, a pro-MAGA think-tank whose job, says one business leader, is “to prevent the amelioration of the Trump agenda”.In other words, Mr Trump has people in place to advance a plan that could shake up the economic framework on which American business has prospered for generations. The pillars of that plan of most immediate concern to corporate America are trade, migration, the fiscal deficit and clean energy.The levy brakesA trade war is the most palpable worry. The self-described “Tariff Man” has floated the idea of imposing a baseline 10% levy on all imports. These would be raised, “an eye for an eye”, in retaliation against any country with a higher tariff. China is the main target. Businesspeople fear his goal is unilaterally to terminate trade with China, which would be a nightmare for any firm exposed to the country. Such a trade policy would be far more draconian than that of the Biden administration, which has kept Mr Trump’s tariffs but worked with allies such as Japan and the Netherlands to restrict export of strategic goods such as advanced semiconductors, without cutting China off altogether.Some hope that Mr Trump is posturing. They take solace in the fact that Congress, not the White House, regulates commerce and that courts adjudicate trade law. Yet Kent Lassman, who contributed a bold essay in support of free trade to the Heritage Foundation’s pro-Trump “Project 2025” road map, thinks the former president means it, even if it disrupts America’s existing trade treaties. Mr Trump “is not changing his stripes”; his sense that everything is a deal and that America is victimised is stronger than ever. His chief advisers on trade, protectionist hawks such as Robert Lighthizer and Peter Navarro, “know how to play off of those beliefs”, Mr Lassman says.Mr Trump’s threat to round up and deport millions of undocumented migrants has also alarmed businesses—not only for humane reasons but because of a chronic worker shortage. In November America had 8.8m job openings. The number of unemployed is 6.3m, notwithstanding a recent surge in migrants crossing over the southern border. Mr Trump’s harshest proposals would be hard to implement. He made a similar mass-deportation promise on the campaign trail in 2016 but was frustrated by court challenges and other pushback. Still, any pickup in expulsions could hurt industries such as farming, leisure, retail and hospitality that rely on low-cost labour, executives say. However important it is to maintain strong borders, whipping up anti-immigrant fervour for political ends also jeopardises legal migration. That hurts businesses’ ability to recruit skilled and unskilled workers alike.Government debt also looms large in CEOs’ minds. They praised Mr Trump’s Tax Cuts and Jobs Act, which reduced corporate tax rates from 35% to 21%. But they fear that neither Mr Trump nor Mr Biden has credible plans to stop the deficit from swelling. If Mr Trump pursues his most unorthodox economic ideas, there are fears that a loss of confidence could jolt the Treasury market, pushing up borrowing costs and sending the dollar into a tailspin.Some think that is going too far. “The world has insatiable demand for US Treasuries,” notes a pro-Biden Wall Street grandee. But a few corporate advisers raise the possibility that an unrestrained Mr Trump could trigger an American version of Britain’s bond-market sell-off in 2022, when investors lost faith in the economic stewardship of Liz Truss, a prime minister who was outlived by a lettuce. “I have parliament envy,” the leader of a lobby group chuckles. Unlike American leaders, he observes wryly, fiscally irresponsible British ones can be quickly forced out of office.America’s environmental trajectory under Mr Trump is another concern. The former president would, like the current one, be expected to double down on industrial policy. But unlike Mr Biden, whose signature effort has been the green-friendly Inflation Reduction Act (IRA), Mr Trump remains a climate sceptic who is likely to try to gut clean-energy programmes. In this case, he may face pushback from his own party. Many of the clean-energy projects predicated on funding from the IRA are in Republican-leaning states. Business, too, is likely to oppose a reversal of Mr Biden’s green agenda. Mr Bradley says that though industrial policy writ large remains “incredibly problematic”, government programmes that induce changes of behaviour are justified when technology is at an early stage, as with clean energy.If Mr Trump’s policy proposals directly related to business do not inspire confidence, his efforts to undermine faith in the judiciary, rule of law, NATO and other alliances, including with Ukraine, raise big questions about America’s role in the world. Some executives shrug this off. A few weeks ago the head of an international asset manager met a group of American bankers and found them “shockingly sanguine” about the election. They told him that whatever the outcome, the system would hold; that stockmarkets had done well under both presidents; and that the American economy was in such rude health that it could survive even electoral shenanigans. “Maybe their point is that business has transcended politics in America,” he says. He adds pensively: “Maybe they are right.”Or maybe they aren’t. Michael Strain of the American Enterprise Institute, a pro-business think-tank, says that Mr Trump’s populism makes political violence in America more likely this year. That would hurt business. The head of a global risk-advisory firm says uncertainty over Mr Trump’s geopolitical agenda will haunt multinationals, making it hard for them to decide, for example, whether or not to allocate resources to China or perhaps even Russia. Any sense that he is weakening the rule of law and the sanctity of contracts and treaties would ripple around the world. “Things like the rule of law are gossamer concepts that disappear just like that,” says a New York financier.His colleague, an expert on geopolitics, says that American businessmen rarely step back to consider how much the country’s global influence, including the hegemony of the dollar and the defence of maritime shipping routes, underpins their companies’ prosperity. Ron Temple, chief market strategist at Lazard, an investment bank, says the gap between right and left has widened in America, amplifying policy variability and becoming too important a factor for business to overlook. “There is almost a sense of complacency, married with entitlement, combined with presumptuousness,” he concludes. If anyone is likely to shake corporate America out of such numbness, it is Mr Trump. ■ More

Investment in the space sector bounced back last year, with $12.5 billion raised in 2023, according to a report Tuesday by New York-based Space Capital.
That was well above last year’s $9.3 billion raised but still below the $15.3 billion brought in during the record-high space investment of 2021.
Space infrastructure companies have been resilient through the recent downturn, but Space Capital’s report also highlighted 2023 as “a year of consolidation,” with 39 M&A deals.

A long exposure photo shows Firefly Aerospace’s fourth Alpha rocket mission launching from California’s Vandenberg Space Force Base on Dec. 22, 2023.
Sean Parker / Firefly Aerospace

Investment in the space sector bounced back last year, rebounding closer to the record high of 2021, according to a report Tuesday by New York-based Space Capital.
“Investment in Infrastructure remained strong, accounting for 70% of total 2023 investment and notching its second highest annual record, spurred by countercyclical revenue from government customers,” Space Capital managing partner Chad Anderson wrote in the report.

The firm’s fourth-quarter report found that space infrastructure companies brought in $2.6 billion of private investment during the period. That brought the sector to $12.5 billion in total investment for 2023, well above last year’s $9.3 billion raised but still below the $15.3 billion brought in during 2021.
Top raises during the fourth quarter included funds announced by space companies Firefly Aerospace, Ursa Major, D-Orbit, Stoke Space and True Anomaly.
The quarterly Space Capital report divides investment in the industry into three technology categories: infrastructure, distribution and application. Infrastructure includes what would be commonly considered as space companies, such as firms that build rockets and satellites.

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Space infrastructure companies have been resilient through the recent downturn. But Anderson also highlighted 2023 as “a year of consolidation,” with 39 merger and acquisition deals across the sector — such as Viasat’s acquisition of Inmarsat and L3Harris’ purchase of Aerojet Rocketdyne.
“We expect to see even more in 2024. The prospect of declining interest rates is boosting equity valuations and improving [leveraged buyout] math, making M&A more likely in 2024,” Anderson told CNBC.

“In 2024 we expect that VCs will be more selective with reserves, letting their low-growth companies run out of cash, in favor of deploying into higher-growth prospects. While we expect to see deal count and volume rebound in the space capital markets, markdowns and write-offs will continue — and this will also lead to more failures and acquisitions,” Anderson added.

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Restaurant Brands International will spend about $1 billion to buy the largest U.S. franchisee of Burger King.
The acquisition comes more than a year after Restaurant Brands unveiled its turnaround strategy for Burger King U.S.
Restaurant Brands plans to remodel 600 of Carrols’ Burger King locations rapidly over the next five years and then sell them back to franchisees.

Burger King fast food restaurant with menu and customers.
Jeff Greenberg | Universal Images Group | Getty Images

Restaurant Brands International is buying Carrols Restaurant Group, the largest Burger King franchisee in the U.S., for about $1 billion in cash.
Restaurant Brands will pay $9.55 per share to acquire Carrols, which operates more than 1,000 Burger King restaurants and 60 Popeyes locations. Carrols’ stock closed at $8.42 on Friday, giving it a market value of $459 million. The company’s shares jumped more than 12% in premarket trading Tuesday.

The deal is expected to be completed by the second quarter of 2024.
The acquisition, announced on Tuesday, is a shift in strategy for Burger King. Its restaurants have been almost entirely franchised for the last decade.
It comes more than a year after Restaurant Brands unveiled a $400 million plan to revive Burger King’s U.S. business. Burger King sales had been lagging behind the competition, and Wendy’s overtook it as the second-largest burger chain by U.S. sales. The comeback strategy focuses on investing in restaurant remodels and advertising to drive demand and boost franchisee profits.
Restaurant Brands plans to remodel 600 of Carrols’ Burger King locations rapidly over the next five years and then sell them back to franchisees, Tom Curtis, president of Burger King U.S. and Canada, said in a statement. The company will invest about $500 million, funded by Carrols’ operating cash flow, to pay for the renovations.
After selling off the majority of Carrols’ locations in five to seven years, Burger King plans to hold onto a couple hundred restaurants for “strategic innovation, training, and operator development purposes.”
Earlier this month, Carrols preannounced its fourth-quarter results, sharing that same-store sales for its Burger King locations rose 7.2%, while traffic increased 2.9%. The franchisee typically outperforms the rest of Burger King’s U.S. system. More

ON JANUARY 13TH William Lai Ching-te was elected as Taiwan’s president. He thus secured a third term for his pro-independence Democratic Progressive Party (dpp). The vote will shape relations between self-governing Taiwan and China, which wants the island to be governed from Beijing. It will also affect the commercial relations between the two—and, because Taiwanese manufacturers sit at the heart of critical global supply chains, between them and the rest of the world.For Taiwan’s big businesses, the cross-strait tensions are unwelcome. Taiwanese entrepreneurs have been building factories on the mainland since the 1980s. These used to make textiles and other cheap goods. Today many make sophisticated electronics, including chips. Chinese data suggest that in 2022 Taiwanese firms had assets worth $43bn in the People’s Republic; by comparison the figure for companies from America, an economy 35 times the size of Taiwan’s, was $86bn. The real sum is almost certainly higher, as Taiwanese companies often channel investments via Hong Kong and other jurisdictions to avoid the scrutiny of their China-wary government.The Chinese Communist Party is likely to express its displeasure at the dpp victory by putting a squeeze on Taiwanese business. It has form. The corporate supporters of the first DPP president, Chen Shui-bian, who served from 2000 to 2008, faced regulatory scrutiny and investment restrictions from China, according to Taiwan’s Mainland Affairs Council, an agency dealing with cross-straits relations. In 2005 Shi Wen-Long, a petrochemical magnate and one of Mr Chen’s biggest backers, was forced into a humiliating public endorsement of China’s anti-secession law, which formalised military threats against the island.Since the dpp returned to power in 2016 under Tsai Ing-wen, Chinese commercial pressure has increased. Far Eastern Group, a Taiwanese conglomerate, was hit by a fine in 2021, which Chinese publications tied to the political views of its chairman, Douglas Hsu. Shortly afterwards Mr Hsu issued a statement rejecting Taiwanese independence. Even businessmen friendlier to China have not been spared. In October Chinese state media reported a tax investigation into Foxconn, a giant Taiwanese contract manufacturer with vast operations in China. Taiwan’s National Security Council claims that the tax probe was a targeted effort by China to prevent Foxconn’s founder, Terry Gou, from dividing the pro-unification camp by running for president. In January China slapped tariffs on a range of Taiwanese chemical exports, a move widely viewed as another warning shot ahead of the election.In the past such bullying led firms either to back the independence-wary Kuomintang (KMT), which favours closer economic links with the mainland, or to stay out of politics altogether (the approach of TSMC, the world’s biggest chipmaker and Taiwan’s most valuable firm). This time corporate grandees, even those with exposure to the mainland, appear less cowed. Some have gone so far as to affiliate themselves with the dpp. Early last year Tung Tzu-hsien, who chairs Pegatron, a big contract manufacturer, became vice-chairman of the New Frontier Foundation, a dpp-associated think-tank. In the run-up to the election Frank Huang, chairman of Powerchip Semiconductor Manufacturing Corporation, endorsed Mr Lai openly.Taiwanese businesses’ increased resistance to China’s strongarm tactics has several causes. American tariffs on Chinese-made goods have made export manufacturing on the mainland less attractive, notes Chun Yi-Lee of Nottingham University. Harsh policies such “zero-covid” pandemic lockdowns and arbitrary crackdowns on sectors such as consumer technology have further dented China’s appeal. The recent weakness of China’s economy is now compounding the sense that Taiwan’s economic future may not be so closely bound up with the mainland.image: The EconomistA shift is already visible in Taiwan’s trade and investment trends. The share of the island’s exports going to the mainland has dropped to 23% over the 12 months to November, down from an all-time high of 30% in 2021 and the lowest in almost two decades (see chart). In 2010, over 80% of Taiwan’s annual outbound investment flows went to mainland China. In 2023 just 11% did. Companies like Pegatron and Foxconn are investing in places like India and Vietnam, which offer both cheaper labour and a chance to avoid the American tariffs. According to one recent poll, more Taiwanese business owners care about Taiwan’s admission to the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, a trade deal between 12 countries including Australia and Japan, than the Economic Co-operation Framework Agreement, which a KMT government signed with China in 2010.China’s ability to inflict pain on Taiwanese business is diminishing for another reason. More than 60% of the island’s exports to the mainland and Hong Kong are electrical machinery and equipment, including computer chips. Cutting off such products could damage Chinese buyers more than it does Taiwanese sellers. ■ More

Monday marks 10 years of Mary Barra’s tenure as CEO of General Motors.
It ushers in a crucial year for the Detroit automaker and for Barra’s legacy.
The automaker is facing challenges with EV demand and its Cruise autonomous driving unit, but those headwinds may play to Barra’s strengths.

Mary Barra, CEO of General Motors, at the New York Stock Exchange, Nov. 17, 2022.
Source: NYSE

DETROIT — Monday marks 10 years of Mary Barra’s tenure as CEO of General Motors, ushering in a crucial year for the Detroit automaker and for her legacy.
Over the past decade, Barra has been a dynamic executive, guiding the company through high-profile crises as the first female leader of a major automaker. Under her stewardship, GM has seen record profits, cultural changes and major achievements, including beating Wall Street earnings forecasts in 34 of the last 35 quarters, according to FactSet.

She’s regularly ranked as one of the most powerful business leaders in the world, with former and current executives describing her as a “visionary” and “inclusive” leader who has always remained focused on the task at hand.
That task, for much of Barra’s time at GM, has been to push the envelope and transform the largest U.S. automaker for sustained success. But her main business plans of late have failed to meet internal or external expectations, including her own.
Initiatives involving electric vehicles and autonomous vehicles have come under pressure, with EV rollout and demand slower than expected and GM majority-owned Cruise in crisis. The EV and AV businesses, along with emerging software initiatives, were major parts of lofty financial targets earmarked for 2025 and 2030.
GM says it can still achieve its goals — among them to double revenue by 2030 — by shifting focus, but it’s yet to detail how, without the help of its stated growth drivers.

Stock chart icon

GM’s stock under CEO Mary Barra’s 10-year tenure.

“I always thought the EV and AV strategies were awfully ambitious and were more to show Wall Street that they were becoming a ‘tech company’ more than an auto company, trying to imitate Tesla too much in many ways,” said Michelle Krebs, an executive analyst with Cox Automotive, who previously covered GM as a reporter starting in the 1980s.

Public criticism of Barra has been scant, but Wall Street and investors are speaking through the company’s stock price.
Famed investor Warren Buffett’s Berkshire Hathaway, which took a major stake in GM in 2012, sold all its shares in the company without explanation during the third quarter of 2023.
GM stock closed Friday at $35.26 per share, down 10.5% under Barra’s tenure and off by nearly 50% from a high of more than $67 on Jan. 5, 2022.

Unplugged?

GM appeared to be the front-runner in recent years to challenge U.S. leader Tesla in electric vehicles with its new EV architecture and billions in investments.
Barra surprised many in 2021 by announcing that GM would end production of traditional internal combustion engine vehicles and exclusively offer consumers EVs by 2035. At the time, GM promised to transform the company and automotive industry through what Barra called “visionary investments,” including what would become $35 billion toward electric and autonomous vehicles by 2025.
She touted GM’s growth opportunities, including its next-generation “Ultium” EV architecture, and many other major automakers followed suit and announced similar electrification goals.
But GM has rolled out its next-gen EV models at a snail’s pace amid production snags. And its most recent model — the Chevy Blazer EV — has paused sales due to significant software problems.
GM’s EV sales last year totaled 75,883 units, or 2.9% of the company’s overall sales. It was third in EV sales behind Tesla, and Hyundai Motor, which includes Kia, according to Cox Automotive. However, a vast majority of GM’s EV sales were from its now-discontinued Chevrolet Bolt models.
Broad consumer demand for EVs hasn’t materialized the way GM or others had hoped, and many automakers have withdrawn or walked back the EV ambitions they set just a few years ago.

Mary Barra, GM chair and CEO, speaks during the unveiling of the Cadillac Celestiq electric sedan in Los Angeles, Oct. 17, 2022.
Frederic J. Brown | AFP | Getty Images

Barra said in December that while there’s still a path to exclusively offer EVs by 2035, customer demand will ultimately determine the pace of the company’s EV transition.
“We still have a plan in place that allows us to be all light-duty vehicles by 2035. But again … we’ll adjust based on where the customer is and where demand is,” she said. “But I do believe this transition will happen over a period of time.”
As early as 2017, GM’s EV focus was on getting as many electric vehicles to market as possible, promising to launch a mix of at least 20 new all-electric and hydrogen fuel-cell vehicles globally by 2023. Then, in November 2020, that goal post shifted, and the automaker said it would introduce at least 30 new EVs by 2025 and spend $27 billion — an amount that was later upped to $35 billion — on electric and autonomous vehicles.
GM has not released exact details about that spending, but executives last year confirmed the automaker was pushing back or cutting EV spending by billions.
In October, GM pulled its near-term EV targets that included selling 400,000 electric vehicles in North America between 2022 and mid-2024 as well as producing 100,000 EVs in North America during the second half of 2023.
The Detroit automaker and Honda Motor also canceled plans to jointly develop affordable EVs, which would have been a $5 billion capital project, and GM opted to instead revive the canceled Chevrolet Bolt as a new model in 2025.
GM maintains it will achieve low profit margins on EVs by 2025 as well as increase North American capacity for the vehicles to 1 million units by then. The automaker expects to maintain an 8% to 10% adjusted profit margin in North America through the transition.

Taking the wheel

If EVs have been struggling to capture consumer attention, autonomous vehicles and GM’s Cruise unit have been commanding it — but not for the reasons Barra would like.
Late last year Cruise transformed nearly overnight from one of GM’s greatest business opportunities into a growing liability.
Cruise, of which GM owns more than 80% and which Barra chairs, has confronted a wave of problems and investigations sparked by an Oct. 2 accident in which a pedestrian in San Francisco was dragged 20 feet by one of the unit’s self-driving cars after the person was struck by another vehicle.
Investigations into the incident are ongoing, GM said Friday.
Since the incident, Cruise’s robotaxi fleet has been grounded, pending the results of independent safety probes. Local and federal governments have launched their own investigations. Cruise leadership has been gutted: Its cofounders resigned and nine other leaders were ousted. And the venture laid off 24% of its workforce.
Beyond all of that, GM is massively cutting spending and growth plans for the business, including pausing production of a new robotaxi.

Mary Barra, chair and chief executive officer of General Motors, during an Automotive Press Association event in Detroit, Dec. 4, 2023.
Jeff Kowalsky | Bloomberg | Getty Images

Barra said during an Automotive Press Association meeting in Detroit in December that GM is “very focused on righting the ship” at Cruise.
Cruise was considered to be among the leaders in autonomous vehicles alongside Alphabet-backed Waymo, outlasting many other companies that have abandoned the segment.
The turmoil at Cruise also calls into question GM’s own plans to offer personal autonomous vehicles by as early as mid-decade, as well as the company’s next-generation driver-assistance system Ultra Cruise.
The Ultra Cruise system was initially planned to debut in 2023 and eventually be capable of driving itself in 95% of scenarios, but progress has been unclear.
Two sources familiar with the system told CNBC that the automaker is ending the Ultra Cruise program. One source said GM has decided to instead focus on the current Super Cruise system and expanding its capabilities rather than having two different, similarly named systems.
Darryll Harrison Jr., GM vice president of global technology communications, declined to comment on specifics of Ultra Cruise but said: “GM continues to expand access to and increase the capability of Super Cruise, our advanced driver assistance technology. Our focus remains on safely deploying this technology across GM brands and more vehicle categories while expanding to even more roads.”

Transformative legacy

Barra took over as CEO of GM in January 2014 when the company was still emerging from government ownership as a result of a 2009 bankruptcy and decades of mismanagement. She was brought in both to deal with the ghosts of GM’s past and to guide the automaker into a cleaner future.
“Mary was one of the few people in the original team that I thought understood that this thing was broken,” Barra’s predecessor Dan Akerson told CNBC in 2022.

GM Chairman and CEO Dan Akerson, left, announces he is stepping down during a town hall meeting at the GM Renaissance Center Global Headquarters in Detroit, Dec. 10, 2013. Listening are Mary Barra, the new CEO; Dan Ammann, the new president; and Mark Reuss, the new executive vice president for global product development, purchasing and supply chain.
Photo by Steve Fecht for General Motors

Barra’s philosophy as CEO and chair, a position she’s held since 2016, has been to address problems head-on. She routinely says the “best time to solve a problem is the minute you know about it.”
That philosophy has served her and GM well thus far, as Barra has navigated what seems like an unending string of crises in the past decade, the second-longest tenure of any CEO in the company’s 115-year history, after its founder.
Barra managed a recall of roughly 30 million vehicles beginning in 2014 after an ignition switch defect caused 120 deaths and led to a complete restructuring of GM’s safety operations.
“The way that she took the ignition switch recall and used it to really drive some deep change into the organization — she shook some things up,” said Stephanie Brinley, associate director of research at S&P Global Mobility. “And I think they’ve made a difference.”
Barra guided the company through the 2014 parts crisis and initiated several company restructurings across the globe, including exiting many unprofitable markets. That fat-trimming was in preparation for an expected disruption from the “mobility” or tech industries and the likes of Lyft, Uber, Apple and Google.
And, she fended off two activist-shareholder campaigns, including from David Einhorn’s Greenlight Capital, which pushed for seats on GM’s board and to initiate a split of GM’s common stock into two classes to help boost its share price.
Einhorn declined to comment through a spokesman on those efforts, Barra or GM, which the firm exited in 2020.

General Motors CEO Mary Barra testifies during a House Energy and Commerce Committee hearing on Capitol Hill in Washington, April 1, 2014.
Getty Images

The more recent challenges facing GM — Cruise, EV uncertainty, shifting priorities — play to Barra’s strengths. She’s discerning in the face of crisis and swift to cull where needed.
“She’s a good leader, and she’s a good listener. But she’s also tough when it comes to making difficult decisions for the shareholders. So far, what I’ve seen, she’s done an outstanding job,” former GM executive Gary Cowger, a mentor of Barra’s who died last year, previously told CNBC.
But as the headwinds compound and some on Wall Street lose confidence, 2024 is shaping up to be either the cherry on top of Barra’s career or an unexpected dent in her track record.
“The shift to EV and autonomous is one that’s just not that simple,” Brinley said. “It’s going to be a struggle for awhile and the success or failure on that is probably not really going to be known very well until well after her tenure.”
When asked in December about her tenure and legacy, Barra, 62, said she doesn’t think about it too much. She’s more focused on what’s in front of her.
“I’m an engineer, problem solver, let’s move forward,” she said. “I’m humbled and it’s a privilege to lead General Motors at this point in time. We’re in the midst of this really once-in-a-generation transformation and there’s so much that can be done.” More

Travelers often ignore safety demonstrations on flights, says the head of the largest flight attendant union in the U.S.
Passengers escaped two terrifying accidents on flights operated by Japan Airlines and Alaska Airlines in recent weeks.
Airlines have reduced the number of flight attendants on board while adding more seats over the last two decades.

A display showing the ‘fasten your seatbelt’ sign and the ‘no smoking’ sign illuminated on board an aircraft.
Jeff Overs | BBC News & Current Affairs | Getty Images

You trudge down the aisle to your seat. You double- and triple-check that you’ve arrived at the right row. You heave your luggage into the overhead bin and squeeze past your fellow passenger to settle into your seat.
Job done. Stress-filled boarding process complete. You zone out.

Never mind that flight attendants have begun their pre-flight safety demonstration, or that a video has begun to play informing you of the procedures in case of an emergency. You’re fine. You’ve seen this one before.
“The attention rate during the safety demos is extremely low,” says Sara Nelson, president of the Association of Flight Attendants-CWA, which represents cabin crews at United, Alaska, Frontier, Hawaiian and others.
There are many lessons to be learned from recent airline incidents, two in just the first week of the year. Among them: It’s time to start paying attention to the pre-take-off safety demonstrations.
On Jan. 2, all 379 people onboard a Japan Airlines Airbus 350-900 escaped the burning aircraft at Tokyo’s Haneda Airport after it collided with a Japanese coast guard plane carrying earthquake aid, killing five crewmembers on that aircraft.
Then, on Jan. 5, a door plug blew out of an Alaska Airlines Boeing 737 Max 9 when the two-month old plane was flying at 16,000 feet, sending oxygen masks down to passengers and leaving a gaping hole in the 26th row. No one was seriously injured on the flight, which returned to Portland, Oregon.

Both near-catastrophes underscore the importance of travelers paying attention to flight attendant safety information and instructions — before and during an accident.
Everyone from passengers to onlookers to aviation executives have commended the crews of those Japan Airlines and Alaska Airlines flights for shepherding passengers through safely.

Please direct your attention

It bears repeating that air travel is incredibly safe. There wasn’t a single fatal accident on a commercial passenger jet crash in 2023, one of the safest years on record.
But that track record is due in large part to safety regulations and protocols. And during those first few minutes of the flight when the door is closed and safety procedures are explained, there are distractions aplenty: streaming entertainment, emails and texts and, increasingly, gate-to-gate Wi-Fi.
Passengers didn’t pay much attention even before the days of smartphones, though, according to Nelson.
A bigger issue, she said, is that airlines have reduced flight attendant staffing on board over the years, while increasing the numbers of seats on each plane.
“Even though newspapers were a distraction and books and conversations before — so it’s not just about phones — I think when there were just more flight attendants directly in your face, more people were paying attention,” she said.
Airlines have gotten creative with how to capture travelers’ attentions during the safety briefing.
Some will pause any seatback screen entertainment during critical announcements. Others have introduced eye-catching production to video presentations to balance out the oft-repeated oxygen mask and life vest tutorials.
“The FAA requires airlines to provide pre-flight safety briefings on what to do if emergencies occur,” the Federal Aviation Administration said in a statement. “The briefings must contain specific information, but the FAA does not tell airlines how to present it.”
After the question of hearing safety instructions comes the natural question of heeding them.
The Japan Airlines inferno, which took 18 minutes to evacuate, avoided fatalities among travelers in part because passengers left their cabin bags behind, allowing for a speedier exit. The carrier’s safety briefing has clear animation about why travelers should not bring any luggage with them during an evacuation — and it appears it helped.
In 2016, American Airlines Flight 383 aborted takeoff after an engine failure, catching fire at Chicago’s O’Hare international Airport. The National Transportation Safety Board found that some passengers brought their carry-on luggage with them during the emergency evacuation, despite being told to leave their bags.
A U.S. Transportation Department watchdog said in 2020 that it found a dozen reports from aircraft evacuations between 2008 and 2018 in which crew members said passengers evacuated or tried to with their carry-on baggage.

Seatbelts on

Passengers are also best served to follow the seatbelt sign and strap in when seated even if the sign is off, per flight attendants instructions.
On Alaska Airlines Flight 1282, when the door plug panel blew out, the plane was not cruising altitude, which means passengers were likely seated and belted in, not walking around the cabin, and flight attendants’ beverage service hadn’t started. That likely helped prevent injury. The force of the event was so violent it ripped some headrests and seatbacks out of the plane, according to initial findings from a federal investigation.
Seatbelts also help avoid injury during turbulence.
“I think the flight attendants are doing great work,” said Anthony Brickhouse, a professor of aerospace safety at Embry-Riddle Aeronautical University. “The flying public needs to do better.”
Nelson said that more travelers pay attention to safety demos after an incident, like the Alaska flight, photos and videos of which were widely circulated on social media, but that it might not last.
“I’ve seen this happen throughout my career,” said Nelson, who joined United as a flight attendant in the 1990s and said passengers, jolted by a high-profile incident, often return to their lackadaisical ways. “The question is: Is it two weeks? Three? Maybe as much as six? There are short memories.” More

Paramount’s “Mean Girls” opened to an estimated $28 million at the domestic box office, on its way to a $32 million take for the holiday weekend.
The haul comes in on the high end of expectations and exceeds the $24.4 million opening that the Lindsay Lohan-led original snared two decades earlier.
It’s particularly impressive considering Paramount had initially commissioned the $36 million-budgeted film for a straight-to-streaming release.

Bebe Wood, Renee Rapp and Avantika Vandanapu star as The Plastics in the 2024 adaptation of “Mean Girls.”

You go, Glen Coco.
Paramount’s “Mean Girls,” a musical film adaptation of the Broadway show and beloved 2004 film of the same name, opened to an estimated $28 million at the domestic box office, on its way to a $32 million take for the holiday weekend.

The haul comes in on the high end of expectations and exceeds the $24.4 million opening that the Lindsay Lohan-led original snared two decades earlier. It’s particularly impressive considering Paramount had initially commissioned the $36 million-budgeted film for a straight-to-streaming release.
“It seems that ‘Mean Girls’ in any format and on every platform has a message that resonates strongly with audiences,” said Paul Dergarabedian, senior media analyst at Comscore. “Whether as a feature film comedy, a Broadway musical or a new big screen adaptation, Tina Fey’s vision for these characters has truly struck a chord with audiences some two decades after the release of the original on the big screen.”
The movie musical genre has struggled to appeal to moviegoers in recent years, but with Warner Bros.’ “Wonka” and “The Color Purple” alongside the new adaptation of “Mean Girls” it seems like audiences have reversed course.
Combine the musical talent and charisma of star Renee Rapp with the pervasive nostalgia of the original film, and the new “Mean Girls” had a lot to offer cinemagoers over the weekend.
“The success of Mean Girls this weekend is a case study in nostalgia successfully paired with a fresh and modern hook for today’s female audience,” said Shawn Robbins, chief analyst at BoxOffice.com. “Many who grew up with the original film returned for this revival alongside younger audiences and fans of the Broadway musical.”

The film skewed toward the female audience, with 75% of ticket sales being bought by women, but played well outside of the teen demographic, said Steve Buck, of movie data firm EntTelligence. In fact, the biggest percentage of ticket sales were for those aged 26 to 35, who accounted for 34% of all opening weekend ticket sales. Meanwhile, the coveted 18 to 25 demographic represented 26% of ticket sales.
“This is another showcase of how important it is for Hollywood to embrace Gen Z alongside their fellow Millennial moviegoers as the two key demographics driving theatrical box office right now,” said BoxOffice.com’s Robbins. “The cinema is a communal hub, and what’s more communal than the marriage of music with movies? Mean Girls is truly an [intellectual property] that’s evolved into a multi-threat pop culture standout.” More

An established but promising group of cancer drugs was a red-hot market in 2023, and more acquisitions and advancements are expected in the year ahead.
That was one clear takeaway from the JPMorgan Healthcare Conference in San Francisco.
Researchers say those drugs could have less toxicity – or unwanted effects on your body that could lead to harm – than standard chemotherapy.

Medical personnel use a mammogram to examine a woman’s breast for breast cancer.
Hannibal Hanschke | dpa | Picture Alliance | Getty Images

SAN FRANCISCO — An established but promising group of cancer drugs was a red-hot market in 2023, and more companies could look to the treatments to fuel growth in the year ahead.
That was one clear takeaway from the JPMorgan Healthcare Conference in San Francisco, the nation’s largest gathering of biotech and pharmaceutical executives, analysts and investors. 

During the four-day event, the biotech and pharmaceutical industry signaled its enthusiasm for antibody-drug conjugates, or ADCs, which deliver a cancer-killing therapy to specifically target and kill cancer cells and minimize damage to healthy ones. Meanwhile, standard chemotherapy is less selective – it can affect both cancer cells and healthy cells.
Johnson & Johnson last week announced a $2 billion acquisition of ADC-developer Ambrx Biopharma to beef up its existing pipeline of ADCs, which some researchers believe could be heralding a “new era” for cancer treatment. Other drugmakers such as Pfizer and Merck, which closed some of the more than 70 ADC-related deals over the last year, said those drugs will be key growth drivers for their businesses. 
Interest in the drugs will only continue this year, as some analysts expect more dealmaking and advancements in ADCs currently in development.
The factors fueling the recent rise of ADCs will not abate this year, and a fear of missing out among businesses that have not entered the market will only push more companies to enter the space, Andy Hsieh, an analyst at William Blair & Company, told CNBC. 
Those factors include increased confidence in ADC technology among companies and researchers, the potentially longer market exclusivity of those drugs and the rise of attractive ADCs from drugmakers in Asia.

The drugs also have potential to draw huge profits: ADCs could account for $31 billion of the $375 billion worldwide cancer market in 2028, according to estimates from the drug market research firm Evaluate. The market for those drugs in 2023 was estimated to be worth around $9.7 billion, another report from research firm MarketsandMarkets said.
“It’s kind of like FOMO, right? Everyone wants to gain exposure to [ADCs] and basically make it a cornerstone of their entire corporate strategy,” Hsieh told CNBC. “I really don’t see any sort of slowing down and it will very much, in our view, be a continuation of the 2023 momentum.” 

Why ADCs have become popular

ADCs aren’t new.
Roughly a dozen have won approvals from regulators worldwide, with the earliest coming in 2000. But dealmaking started to pick up in 2020 and “really take off” in 2022 and 2023, according to Daina Graybosch, senior research analyst at Leerink Partners covering immuno-oncology.
She called the recent rise of ADCs a “multi-decade innovation cycle,” where it took several years for the industry to make some “fundamental transformative innovation, which then unlocked more investment and a lot more potential.”
Improvements in ADC technology appeared to have made some newer iterations of the drugs more safe and effective, which boosted the industry’s confidence in their potential and encouraged more investments in the space. The steady surge of approvals and acquisitions over the last several years also contributed to that confidence, convincing some companies that ADCs have a “lower-risk development path,” Hsieh said.

A view of an AstraZeneca facility is seen during Prime Minister Scott Morrison’s visit on August 19, 2020 in Sydney, Australia.
Lisa Maree Williams | Getty Images News | Getty Images

Graybosch highlighted an ADC jointly developed by AstraZeneca and Japanese drugmaker Daiichi Sankyo called Enhertu, which she called the first of “the next-generation ADC” that had a greater breadth of treatment compared to older versions of the drugs. For example, Enhertu became the first ADC to show the ability to treat breast cancer patients with both high and low levels of a protein called HER2, which controls how breast cells grow, divide and repair damage.
Drugmakers have fine-tuned key components of ADCs over the last several years, such as the chemical bond that helps those drugs deliver a cancer-killing therapy to cancer cells, according to William Blair’s Hseih. He said companies are learning how to maximize the efficacy of those drugs “without getting into too much side effects.”
ADCs still have their drawbacks — for example, cancer tumors can develop resistance to them over time. And not all newer ADCs in development are successful: Last month, Sanofi scrapped its only experimental ADC after it fell short in a late-stage trial in lung cancer patients.
Graybosch also noted that companies from Japan and China have emerged as effective ADC developers that are rapidly “innovating tweaks” to the drugs and bringing ADCs to the market that could be better than older versions of the drugs.
U.S. and U.K.-based companies are inking deals with those international drugmakers, such as two licensing agreements GSK signed late last year with Chinese-based Hansoh Pharma for ADCs targeting several types of cancer.
The complexity of ADC technology has likely become another motivation for companies to invest in and develop the drugs, Hsieh noted. He said it could reduce the chances that other companies will create biosimilars, allowing drugmakers to keep ADC prices high for longer periods of time. 
Gilead’s approved ADC for breast cancer, Trodelvy, has a U.S. list price of more than $2,000 per vial. But some ADCs on the market have far higher list prices: An advanced ovarian cancer drug from biotech company ImmunoGen costs more than $6,000 per vial as of 2022.
List prices are before insurance and other rebates.

How some drugmakers are betting on ADCs

Merck now expects $20 billion in new cancer drug sales by the early to mid-2030s, thanks in part to its recent investments in ADCs, executives announced during the conference. That’s double the estimate the company provided during the same conference last year. 
The raised forecast signals Merck’s confidence in the future of its cancer drug offerings, even as its blockbuster immunotherapy Keytruda nears a loss of exclusivity in 2028. That will expose it to generic competition. 
Merck executives highlighted its up to $5.5 billion licensing agreement with Daiichi Sankyo to jointly develop three of the Japanese drugmaker’s experimental ADCs. This year, the company hopes to win an approval for one of those ADCs for the treatment of non-small cell lung cancer. 
“….We have a leading position now in antibody-drug conjugates, and we’ve done that through what I think is very smart deal-making,” Merck CEO Robert Davis said. He added that “what all of that really translates to is the potential for growth.”

Newly built Merck research facility located at 213 E Grand Ave in South San Francisco.
JasonDoiy | iStock Unreleased | Getty Images

Pfizer hopes ADCs will help the company turn around after a rocky 2023. Shares fell roughly 40% last year as Pfizer grappled with weakening demand for its Covid products and other commercial missteps. 
Pfizer CEO Albert Bourla told reporters that the company’s $34 billion acquisition of ADC-developer Seagen would help restore investor confidence in Pfizer, especially now that the deal is officially closed. 
Bourla noted that antibody-drug conjugates have become the hottest area of oncology, adding that Seagen’s expertise in ADCs will give Pfizer a huge advantage in developing those drugs further and establishing itself as a leader in cancer treatment. 
Pfizer believes the Seagen acquisition will bring in more than $10 billion in risk-adjusted sales by 2030. Seagen specifically brings four approved cancer drugs, including three ADCs, which will beef up Pfizer’s own ADC portfolio.  More