The world this week
Business
In a court filing, America’s Justice Department revealed that Boeingwould plead guilty to misleading air-safety regulators about its 737 MAX aircraft ahead of two fatal crashes in 2018 and 2019. The agreement rips up a previous settlement from 2021 in which Boeing admitted that two employees had misled regulators. The government believes Boeing has failed to comply with that settlement. There have been a number of safety incidents this year, including a door plug that blew off a 737 MAX upon takeoff. The families of the crash victims are not happy. By pleading guilty, Boeing avoids the glaring publicity of a trial.
Microsoft has reportedly given up its board seat at OpenAI amid scrutiny from competition regulators about the pair’s partnership. Microsoft holds a minority economic interest in the developer of ChatGPT.
Apple has also decided not to join OpenAI’s board as an observer, according to reports. Apple recently struck a deal to incorporate ChatGPT into its new operating system.
In what both companies described as the largest deal of its kind, Occidental announced an agreement to sell 500,000 tonnes of carbondioxide removal credits to Microsoft over six years. The arrangement allows Microsoft to offset its emissions by paying Occidental to take carbon from the atmosphere and store it underground. The tech giant’s emissions have soared in recent years, mostly because of the huge amounts of power needed for artificial intelligence and data centres.
Shell said that it expects to book a write-down of between $600m and $1bn on the construction of a plant in Rotterdam that was supposed to convert waste into green jet fuel and biodiesel. The project has been put on hold, in part because an oversupply of biofuels has changed the economics of the industry. Meanwhile, BP issued a profit warning because of “significantly lower” margins in oil refining.
BYD boosted its plans to expand in Europe by sealing an agreement to build a factory in Turkey that will churn out its electric vehicles. The Chinese carmaker expects production to start at the end of 2026 at the plant, which will produce 150,000 EVs a year. The cars would avoid potential punitive EU tariffs on imported Chinese EVs, because Turkey is part of the EU’s customs union.
Moving forward
Robotaxis continued their relentless drive to become a feature of everyday life. Shanghai is now allowing the driverless cars to accept non-paying passengers in a testing area (the cars previously had to have a safety supervisor behind the wheel). A handful of Chinese cities, including Beijing, have already started charging fees for robotaxis.
There were no surprises in Jerome Powell’s semi-annual testimony to Congress. The Federal Reserve’s chairman didn’t indicate when the central bank would start cutting rates, as more evidence was needed that inflation was easing. Mr Powell’s main focus was the labour market, which he said had “cooled considerably” from two years ago.
A jury in New York found Bill Hwang, the founder of Archegos Capital Management, guilty of artificially inflating the value of stocks in his portfolio. The collapse of Archegos in 2021 led to hefty losses at banks that dealt with the fund, including Credit Suisse.
Ariane 6, the European Space Agency’s new heavy-lift rocket, launched its first voyage into space from its base in French Guiana. The mission, four years late, successfully deployed its satellite payload. Europe wants its own programme for delivering satellites, but questions have been raised about how competitive it will be against SpaceX and other private rocket providers.
A new round of financing reportedly doubled the value over two years of Athletic Brewing, America’s biggest maker of non-alcoholic beer, to $800m. Athletic’s brands, which include Run Wild IPA and Upside Dawn Golden, have helped it become one of the top 20 brewers in the country. No-alcohol beer sales have surged, especially among the young, while sales of the harder stuff have drooped.
That’s a wrap
After a months-long saga worthy of a Hollywood drama, Paramount Global agreed to merge with Skydance Media, run by David Ellison, the son of Oracle’s founder, Larry Ellison. Skydance is one of the production companies behind such hits as “Top Gun: Maverick” and the recent Mission Impossible films. In a complex deal, Skydance is taking over the family company run by Shari Redstone that controls Paramount. The lengthy process to reach a deal saw an earlier proposal fall apart, rumours in markets of counter offers and the defenestration of Paramount’s chief executive.