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An ongoing strike by the UAW union against the Detroit automakers had little to no direct effect on General Motors’ third-quarter U.S. new vehicle sales.
The Detroit automaker on Tuesday reported a 21.4% increase in sales from July through September compared to still subdued sales in the third quarter of 2022,.
GM and other companies likely will face sales and supply chain problems if the UAW’s strike, which began Sept. 15, is expanded or prolonged.

United Auto Workers (UAW) members and supporters on a picket line outside the General Motors Co. Flint Processing Center in Swartz Creek, Michigan, US, on Monday, Sept. 25, 2023. 
Emily Elconin | Bloomberg | Getty Images

DETROIT – An ongoing strike by the United Auto Workers union against the Detroit automakers had little to no direct effect on General Motors’ third-quarter U.S. new vehicle sales.
The Detroit automaker on Tuesday reported a 21.4% increase in sales from July through September, compared to still subdued sales in the third quarter of 2022, when the industry was still recovering from supply chain issues.

GM’s increase significantly outpaced auto analyst expectations for the overall industry of 15% to 16% for the third quarter. Sales of every one of the Detroit automaker’s brands rose compared to a year earlier.
Not all automakers faired as well as GM in the quarter. But their sales largely climbed in terms of vehicles sold compared to a year ago. Third-quarter sales results reported Tuesday included: Toyota Motor up 12.2%; Hyundai Motor up roughly 9%; Kia up about 14%; Mazda up about 22%; and Honda up roughly 53%.
Stellantis was an outlier, as sales slid 1.3%. The company’s decline is notable, but not likely to be attributed to the UAW strikes. Stellantis’ sales have struggled as it attempts to retain high profits achieved in recent years by not discounting its vehicles as much as it has historically. The company did not immediately respond to a request for comment.
Though work stoppages may not have hit their results yet, GM and other companies likely will face sales and supply chain problems if the UAW’s strike, which began Sept. 15, is expanded or prolonged. Only 25,200 workers, or roughly 17% of UAW members covered by the expired contracts with GM, Ford Motor and Stellantis, are part of the work stoppages.
UAW has been gradually increasing the strikes since the work stoppages began, after the sides failed to reach tentative agreements by Sept 14. The targeted, or “stand up,” strikes are taking place instead of national walkouts in which all plants simultaneously strike.

National strikes affect the companies more quickly. The targeted walkouts aim to preserve the union’s funds and prolong the work stoppages to keep the automakers off keel.
The impacts of the strikes will likely begin showing in October for certain vehicles such as the Chevrolet Colorado and GMC Canyon midsize pickups, where work stoppages have affected production, according to Cox Automotive chief economist Jonathan Smoke.

2024 Chevrolet Trax (left) and 2024 Buick Envista
Michael Wayland / CNBC

“Thus far, the impact has been fairly muted,” Smoke said in a Friday blog post. “Should the strike against production sites further expand, the more vulnerable products are the large SUVs from Chevrolet and Cadillac, which have tighter inventory levels compared to their domestic rivals.”
For GM, the UAW strikes have hit production of the midsize pickups and Chevrolet Traverse and Buick Enclave SUVs.
GM’s sales heading into the fourth quarter were up more than 19% to roughly 1.97 million vehicles sold in the U.S. That included more than 20,000 electric vehicle sales, a 28% increase compared to the second quarter.
Notably, the automaker started selling new electric versions of its Chevrolet Blazer SUV and Silverado pickup during the third quarter. The company also increased production and sales of the Cadillac Lyriq EV and Hummer models during the quarter. However, sales still pale in comparison to Tesla’s electric vehicle deliveries.
During the quarter, GM also was assisted by growth of newer, entry-level models such as the Chevrolet Trax and Buick Envista, both of which are being imported from plants in South Korea. More

The average rate on the popular 30-year fixed mortgage rose to 7.72%, according to Mortgage News Daily.
Mortgage rates follow loosely the yield on the 10-year Treasury, which has been climbing this week.

Ryan Ratliff, center, real estate sales associate with Re/Max Advance Realty, shows Ryan Paredes, left, and Ariadna Paredes a home for sale in Cutler Bay, Florida, on April 20, 2023.
Joe Raedle | Getty Images

The average rate on the popular 30-year fixed mortgage rose to 7.72% on Tuesday, according to Mortgage News Daily.
Mortgage rates follow loosely the yield on the 10-year Treasury, which has been climbing this week following strong economic data. Rates have not been this high since the end of 2000.

At the beginning of this year, the 30-year fixed rate dropped to about 6%, causing a brief burst of activity in the spring housing market. But it began rising steadily again over the summer, causing sales to drop, despite strong demand. The current trend appears to be even higher, with the possibility of rates crossing over 8%.
The Federal Reserve did not raise interest rates two weeks ago but indicated the possibility of another hike this year and fewer cuts than expected next year. Investors were waiting to see the results of economic data in the first week of October.
“It is now the first week of October, and data has been stronger,” wrote Matthew Graham, chief operating officer at Mortgage News Daily. “This morning’s JOLTS (job openings and labor turnover survey) is the biggest, baddest confirmation so far this week, and it’s pushing yields to fresh long-term highs. Pretty simple stuff, actually, even if unpleasant and unfortunate for fans of low rates.”
Higher rates have crushed affordability, hitting both the new and existing home sales markets. While builders had been benefiting from the tight supply of existing homes for sale, higher mortgage rates are a major concern now. Builder sentiment slipped into negative territory in September for the first time in five months.
To put rates in perspective, for a borrower purchasing a $400,000 home with a 20% down payment on a 30-year fixed loan, the monthly payment today is about $930 more than it was when rates were at 3% during the height of the Covid-19 pandemic. More

A shortage of luxury apartments in Manhattan is causing a surge in prices at the top of the market.
The supply of luxury apartments has plunged 24% compared to pre-pandemic levels, according to Miller Samuel.
Median prices for luxury apartments have increased in three of the past four quarters, while overall median prices in Manhattan are down.

Guests attend a pool party in the penthouse apartment at the 50 United Nations Plaza building in New York.
Michael Nagle | Bloomberg | Getty Images

A shortage of luxury apartments in Manhattan is causing a surge in prices at the top of the market, even as broader apartment sales and prices come under pressure from rising mortgage rates.
Manhattan apartment sales fell 23% in the third quarter as rising interest rates squeezed potential buyers, according to new data from Douglas Elliman and Miller Samuel. Median and average sales prices remained flat, with the average price of a Manhattan apartment stalled at $1.96 million and the median price at $1.15 million.

The high end of the market, however, has seen a big drop in supply and stronger prices.
The supply of luxury apartments — defined as the top 10% of the market by price — has plunged 24% compared to pre-pandemic levels, according to Miller Samuel. The inventory of luxury apartments for sale marked their lowest third quarter in five years.
Jonathan Miller, CEO of Miller Samuel, said high-end buyers are typically less sensitive to mortgage rates since they often pay in cash. As a result, the wealthy have continued buying and taking advantage of more attractive prices.
At the same time, newly built condominium towers have been the main driver of high-end sales since the Covid-19 pandemic. Now, most of those new, high-priced condominiums have been sold — and few new projects are being launched due to a lack of bank lending.
“A lot of that new development inventory sold off during the pandemic boom,” Miller said. “The higher end of the market is seeing much less of a contribution from new development sales.”

With fewer new luxury condominium towers now under construction, prices at the high end could continue to rise or remain strong, brokers say.
According to Serhant, there were nine sales of Manhattan apartments priced at $20 million or more in the third quarter, compared to just two during the same period last year.
Median prices for luxury apartments have increased in three of the past four quarters, according to Miller Samuel. By contrast, overall median prices in Manhattan have been down for four quarters in a row.
“There is clearly more strength at the higher end than the overall market,” Miller said. More

Krispy Kreme is considering an all-cash sale, among other alternatives, for its majority stake in Insomnia Cookies.
Krispy Kreme bought a majority stake in Insomnia Cookies in 2018.
The company said it wants to focus more on its core doughnut business.

A Krispy Kreme glazed doughnut is shown in Daly City, California, on May 12, 2022.
Justin Sullivan | Getty Images

Krispy Kreme is exploring strategic alternatives, including an all-cash sale, of its majority stake in Insomnia Cookies, the company said Tuesday.
The decision is part of an effort to focus more on its core doughnut business, the company said.

Krispy Kreme acquired control of Insomnia Cookies in 2018 in a deal backed by European investment firm JAB Holding. The deal valued Insomnia Cookies at less than $500 million, sources told CNBC at the time.
“We acquired a majority stake in Insomnia Cookies to build our e-commerce and digital capability as well as assist Insomnia’s U.S. and International expansion,” said Krispy Kreme CEO Mike Tattersfield in a statement. “Both efforts have been successful and it’s time for the next strategic step for both companies.”
Krispy Kreme went public for the second time in 2021, at an implied valuation of $2.7 billion. The doughnut chain first went public in 2000 but was taken private in a sale to JAB Holding in 2016.
Insomnia Cookies, which is known for serving cookies well into the early morning hours, has tripled its revenue since 2017, Krispy Kreme said Tuesday. The cookie chain has expanded from more than 135 locations in 2018 to 250 locations today.
The cookie chain was founded in 2003 by University of Pennsylvania student Seth Berkowitz, who is CEO of Insomnia Cookies. The bakeries are often found near college campuses to feed the cravings of students staying up late into the night.
“It has been an honor to partner with Krispy Kreme in an unprecedented chapter of growth for Insomnia Cookies,” Berkowitz said in a statement. More

Hot off the heels of a distribution deal to bring Taylor Swift’s filmed Eras Tour to cinemas, AMC Entertainment will now bring a documentary on Beyonce’s Renaissance album and tour to theaters.
The film will appear in theaters on Thursdays, Fridays, Saturdays and Sundays for around four weeks starting Dec. 1.
Tickets will start at $22 for standard showtimes, with premium large format screens like Imax and Dolby Cinema available for a higher fee.

Beyoncé performs onstage during the “RENAISSANCE WORLD TOUR”
Kevin Mazur | Getty Images Entertainment | Getty Images

Movie theaters will become a Bey Hive this December.
Hot off the heels of a distribution deal to bring Taylor Swift’s filmed Eras Tour to cinemas, AMC Entertainment has partnered with Parkwood Entertainment to bring a documentary on Beyonce’s Renaissance album and tour to theaters.

The film will appear in theaters on Thursdays, Fridays, Saturdays and Sundays for around four weeks starting Dec. 1. Tickets will start at $22 for standard showtimes, with premium large format screens like IMAX and Dolby Cinema available for a higher fee. The movie will screen at a variety of theaters nationwide, including AMC, Regal and Cinemark, Cinepolis, Cineplex and Harkins.
Beyonce’s appearance on the film calendar is a much-needed boon for the North American box office. The film industry is still in recovery mode after the pandemic and has seen fewer releases in recent years, leading to fewer ticket sales.
“Early December is a historically slow period between the Thanksgiving and Christmas corridors with very few high-profile new releases,” said Shawn Robbins, chief analyst at BoxOffice.com. “This year’s slate during that time was certainly a bit thin before Beyonce staked her claim. There’s no question, having her fans come out to support her music and artistry on the big screen will fill some of that gap and continue to change how the industry approaches rare but occasional dead zones on the calendar when Hollywood studios aren’t releasing blockbusters.”
So far, the big releases during the month of December are dominated by three Warner Bros. titles — “Wonka” hits theaters Dec. 15, followed by “Aquaman and the Lost Kingdom” on Dec. 20 and “The Color Purple” on Christmas Day.
Those offerings give Beyonce’s movie plenty of room to run at the box office.

“The cultural impact, brand enhancement and, of course, revenue-generating potential is clearly a motivating factor in the decision to go with a theatrical rather than a streaming release,” said Paul Dergarabedian, senior media analyst at Comscore.
It’s unclear what Beyonce’s film could open to in December, as tickets just went on sale Monday. Industry observers expect Swift’s concert film, due in theaters Oct. 13, will open to at least $100 million in ticket sales.
By the end of Swift’s international tour dates next year, music analysts predict the star’s Eras Tour will have generated between $1 billion and $1.4 billion in revenue. Beyonce’s tour looks to top out just above $560 million.

What’s in it for AMC?

The Beyonce and Swift releases also are part of AMC’s new revenue-generation strategy. The theater chain, in bypassing the traditional studio release model, will pick up distribution fees as well as share in the ticket sales.
AMC, in particular, needs this kind of revenue, as the company continues to spend more on film-licensing costs and theater rentals than it makes in ticket and concession sales. In fact, the company only recently posted a profit during its second quarter this year, having generated net income of just $8.6 million.
“This is another savvy move by creators and exhibitors that bolsters the bottom line for movie theaters at year’s end while uncovering more unexplored potential from specialty event releases,” Robbins said.

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AMC Entertainment’s YTD stock performance.

AMC, and other movie theater chains, will also benefit from elevated concession sales as moviegoers load up on popcorn and soda for these concert films. AMC is already promoting collectible Taylor Swift popcorn tubs for $14.99 and cups for $11.99. No doubt, Beyonce-themed items will be revealed soon.
“The theaters have been playing live or recorded concerts for over a year now and began talking about alternative content possibilities two years ago, but the scale of Taylor Swift and Beyonce is certainly bringing more attention to this strategy,” said Alicia Reese, analyst at Wedbush. “It will be difficult to find other acts of this scale, but there are plenty of artists who will be touring next summer and theaters will likely be reaching out to schedule concert films to fill any gaps in the 2024 summer release slate.”
Those gaps have come from production delays related to the two Hollywood labor strikes. The box office saw several titles leave for 2024 release dates and its still unclear where currently scheduled titles will wind up once the dust settles. More

Chipotle Mexican Grill is testing a robot made with Hyphen technology that can assemble burrito bowls and salads.
The technology would only be used for digital orders.
Restaurants are investing heavily into automation, but it may be years before the technology pays off.

A finished burrito bowl assembled by Chipotle and Hyphen’s automation technology.
Source: Chipotle Mexican Grill

Chipotle Mexican Grill is testing whether automation can make customers’ burrito bowls and salads.
It’s the second time the burrito chain has publicly announced testing automation at its innovation center. Chippy, Chipotle’s first foray into automation, is a robot that makes tortilla chips. The company began testing Chippy at a California restaurant a year ago after it passed the first round of testing.

Restaurants ranging from Sweetgreen to Starbucks have been investing in automation to cut down on labor costs and improve order consistency and speed. But robotics and artificial intelligence software can be expensive, so it will likely be years before the technology pays off for restaurants.
Still, many operators have big hopes for automation’s future in the restaurant industry. Sweetgreen opened its first automated location in May and CEO Jonathan Neman already expects all of the chain’s future restaurants to be automated in five years.
The Chipotle test announced Tuesday is part of a collaboration with Hyphen, a startup that’s trying to automate restaurant kitchens. Last year, Chipotle invested an undisclosed amount in Hyphen, formerly known as Ono Food. The startup has a valuation of $104 million, according to PitchBook.
All Chipotle restaurants have two make lines to assemble orders: one in the front for diners who order in person and another in the kitchen for digital orders. Roughly two-thirds of all Chipotle digital orders are either burrito bowls or salads, according to Chipotle.
The Hyphen robot will make burrito bowls and salads for digital orders only. The technology moves the bowls underneath the digital make line to dispense the correct ingredients. Simultaneously, an employee can assemble digital orders for other items, such as tacos, quesadillas and burritos, on the digital make line. When the robot is done making an order, it sends the bowl or salad back up to the surface so employees can properly package the order. More

Macy’s will open up to 30 more stores in strip centers, as it thinks outside of the shopping mall.
The stores are roughly one-fifth the size of its traditional stores.
The move marks an inflection point for the department store operator, which has struggled with dwindling mall traffic.

Macy’s is opening more small-format stores across the country. They are roughly one fifth the size of its typical locations.

Macy’s on Tuesday said it will open up to 30 smaller stores in strip malls over the next two years, as the retailer chases customers out of dying malls and into bustling suburbs.
The company did not announce locations, but said the additional stores will start to open next year.

The expansion marks an inflection point for the department store operator, which has looked for ways to refresh its legacy brand, cope with dwindling mall traffic and compete with retailers that have stolen away shoppers. Macy’s has faced even more challenges in the past six months, as middle-income Americans — who drive most sales at its namesake stores and website — watch their spending and rack up debt on their credit cards. The company cut its full-year forecast this summer and expects weak sales to persist.
Chief Stores Officer Marc Mastronardi said small-format stores are part of the solution. Macy’s has tested the shops, which are roughly one-fifth the size of its traditional mall stores, for nearly four years. The stores offer a slimmed-down mix of merchandise, host local events, and have a more modern and open look. Plus, they’re next to big-box stores, grocers and popular off-price retailers like TJX-owned T.J. Maxx.
“The high level of convenience in places that have a lot of traffic — that’s been the secret sauce,” Mastronardi said.

Macy’s smaller, off-mall stores have spacious fitting rooms and a curated mix of merchandise that’s frequently swapped out. Beauty, toys and career apparel have been big sellers at the stores.

The off-mall stores have put up stronger results than the rest of Macy’s. And based on the company’s own shopper surveys, the stores get high marks for being easy to shop, neat, and staffed by helpful and friendly employees, Mastronardi said.
Macy’s small-format stores open for more than one fiscal year have posted comparable sales growth on an owned-plus-licensed basis from the beginning of the fiscal year, which began in late January, through the fiscal second quarter, which ended July 29. Comparable sales, a retail industry metric, aims to take out the impact of store openings, closures and renovations to allow better year-over-year comparisons.

Across the rest of the company, comparable sales on an owned-plus-licensed basis declined by roughly 7% in both the fiscal first quarter and fiscal second quarter. Along with Macy’s namesake stores, that metric includes trends at higher-end department store Bloomingdale’s and beauty chain Bluemercury, which have generally outperformed the namesake stores.
By the end of this year, Macy’s will have 15 of the smaller stores, not including the announced expansion. Three are Bloomie’s, a smaller version of the Macy’s-owned Bloomingdale’s. The up to 30 new stores that are coming will be called Macy’s. The company is phasing out Market by Macy’s, the name it initially used for the smaller Macy’s stores.

Macy’s has dealt with the skepticism from investors who often link its fate with those of struggling shopping malls. Shares of the company have largely been on a downward trend since 2015. So far this year, the company’s stock is down about 44% even as the S&P 500 has risen about 12% during the same time period.
Led by CEO Jeff Gennette, the company has focused on five growth drivers, including off-mall expansion. It has also refreshed and debuted new private brands, launched a third-party marketplace online, focused on luxury brands, and increased personalized offers and communication with customers.
Gennette will soon pass the reins to Tony Spring, CEO of Bloomingdale’s, as he retires early next year.
Oliver Chen, a senior equity research analyst at Cowen who covers retail and luxury goods, said Macy’s is under pressure to appeal to younger consumers and differentiate from competitors. Those rivals include specialty retailers like Ulta Beauty and Sephora and off-price retailers or fast-fashion players where shoppers may get a better deal or superior service.
“[Macy’s leaders] don’t have their head in the mud,” he said. “They understand the need to be relevant and grow and to think about off-mall.”
He pointed to some signs of progress, including the return of Nike and Under Armour merchandise to stores and its website and the launch of a new women’s private brand, On 34th.
Shoppers who have come to the smaller stores look similar to Macy’s typical customer, but have a more curated mix of merchandise to choose from since stores are smaller, Mastronardi said. Popular categories at the small-format stores have been toys, beauty and career apparel, according to the company.
Macy’s has opened the stores in three different kinds of markets. In some cases, it has put them in areas that already have a large store, but also have high demand. It has used others to replace stores in floundering malls. Macy’s has also broken into new regions where it does not have stores.
Mastronardi said the company has tracked sales data in markets where Macy’s has a typical mall store and an off-mall store. He said the retailer has not seen signs of the new shops cannibalizing its existing stores, where sales just move from one to the other.
“What we’re seeing is it’s really just an extra visit into the Macy’s brand,” he said. More

Il Makiage and Spoiled Child parent company Oddity Tech expects revenue to grow between 29% to 31% in the three months ended Sept. 30.
The company, which uses artificial intelligence to develop products, is now expecting a gross margin of 68.5% for the period, one percentage point higher than its previous guidance.
The company started trading on the Nasdaq in July and has seen shares fall by about 50% since reaching a high of $56.

Oddity Il Makiage
Coutesy: Oddity

Oddity Tech released preliminary third-quarter results on Monday that show expected revenue growth of 29% to 31%, driven by repeat sales at its Il Makiage and Spoiled Child brands.
The newly public retailer, which started trading on the Nasdaq in July and uses artificial intelligence to develop products, had previously expected sales to grow by about 20.5% in the three months ended Sept. 30. 

The Tel Aviv-based company didn’t share its exact sales figure for the quarter, but in the year ago period, it posted $68.9 million in revenue, finance chief Lindsay Drucker Mann told CNBC.
The company is also now expecting a gross margin of 68.5% for the period, one percentage point higher than its previous guidance of 67.5%, and margins on its adjusted earnings before interest, tax, depreciation and amortization to be at the high end of its previous range. Oddity is now expecting an adjusted EBITDA margin of between 21% to 21.5%, compared to its initial guidance of 20% to 21.5%. 
So far this year, sales have jumped by about 58% with adjusted EBITDA of at least $89 million, Oddity said. 
“It was strength across the board, upside from both Il Makiage and Spoiled Child. At the end of the day, our repeat revenues were stronger than we had expected and importantly, those sales were of very high quality so they came with some very strong profitability associated with them,” Drucker Mann said in an interview. 
“We have these machine learning models at almost every part of the user journey. They’re responsible for the high satisfaction, which leads to our great repeat rates, it drives our strong profitability and our high growth. Without these models, we would never be able to print these results, we would just be another unprofitable [direct-to-consumer] company.” 

Oddity is on a mission to disrupt the legacy beauty and wellness industry by using AI to not just select products for customers, but to develop them as well. It often boasts that it doesn’t hire from the legacy beauty industry and instead focuses on recruiting technologists, many of whom came from the Israeli Defense Forces’ best technology units.
In April, it announced plans to acquire biotech startup Revela and open the Boston-based Oddity Labs in a bid to make cosmetics that address age-old problems like hair loss and wrinkles. The lab is tasked with using AI to create brand-new molecules – a common tool used in the pharmaceutical industry to create new drugs, but one that isn’t widely used in the beauty and wellness industry. 
In a statement, CEO Oran Holtzman said Oddity Labs is expanding faster than expected and “delivering game changing ingredient innovation.”
The company expects Oddity Labs to have 10 products ready for market in 2024. Over the next five years, it expects Oddity Labs to drive 30% or more of the company’s overall revenue, said Drucker Mann. 
When Oddity first debuted on the public markets over the summer, it began trading with a 35% pop and saw its stock close at $47.53. Soon after, it reached a high of $56 per share but since then, Oddity’s stock has fallen by about 50%, with shares closing at $28.08 on Monday.
Drucker Mann said Oddity’s share price, along with the share price of other companies that recently went public, reflects “the natural ebb and flow of risk sentiment in the early stages of a market recovery.”
“Momentum can drive the short term, but fundamentals drive the long term and our fundamental story is super exciting, so we’re feeling really confident,” she said. More