US-based Lockheed Martin hosts specialized suppliers workshop in Riyadh

US-based Lockheed Martin hosts specialized suppliers workshop in Riyadh
Two US Air Force Lockheed Martin F-35 fighter jets fly over the beach of Houlgate, north-western France (Getty)
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Updated 14 October 2021

US-based Lockheed Martin hosts specialized suppliers workshop in Riyadh

US-based Lockheed Martin hosts specialized suppliers workshop in Riyadh

The US-based defence corporation, Lockheed Martin, hosted a specialized suppliers workshop in Riyadh on Thursday to establish partnership opportunities with companies in Saudi’s aerospace and defense sector.  

The workshops included talks on localization and how firms could work with the company to strengthen local defense supply chains.

Deputy governor for military industry at the General Authority of Military Industries, Gasem Al Maimani, has highlighted the authority’s goal to boost Saudi’s efforts to localize more than 50 percent of government spending on military equipment and services by 2030.

“We have a long track record of transferring technologies and sharing expertise with Saudi Arabia and are working diligently to create high-quality jobs for the workforce," said Joseph Rank, chief executive for the company in the Kingdom, adding: "Saudi suppliers in the defense sector will be central to helping localize defense expenditure."


PIF-owned ACWA Power to become a net zero energy producer, CEO says

PIF-owned ACWA Power to become a net zero energy producer, CEO says
Updated 13 sec ago

PIF-owned ACWA Power to become a net zero energy producer, CEO says

PIF-owned ACWA Power to become a net zero energy producer, CEO says

RIYADH: The head of ACWA Power, Saudi Arabia’s only listed company with ambitious renewable projects, plans to end investment in non-renewable schemes as part of the business’s commitment to reaching net zero by 2050.

Speaking ahead of the Saudi Green Initiative forum that will be held in Riyadh on October 23, Paddy Padmanathan, chief executive of ACWA Power, which floated on the Kingdom’s stock exchange earlier this month, told Arab News: “We want to reduce carbon emissions, because climate change is real. We can see it, we can feel it.”

Riyadh-based ACWA, which is 44 percent owned by Saudi Arabia's sovereign wealth fund PIF, is the Kingdom’s most high-profile entity for building renewable energy and hydrogen projects.

The company is expected to deliver at least 70 percent of Saudi Arabia’s renewable schemes by 2030, and is forecast to take part in around $30 billion worth of green projects over the next 10 years, as the Kingdom’s strategy to diversify its economy away from fossil fuels gathers pace. 

ACWA began trading on the Saudi stock market this month after selling an 11 percent stake. The move values the entire company at $10.9 billion.

Padmanathan said: “We will not invest in coal going forward, we will not do any more coal power plants.  We will not obviously do anymore oil. In terms of our existing oil-fired power plants in the Kingdom, the government is committed to shutting those down by 2030, so we'll be working with them on how to shut those down, and then repower them all. The existing fleet of oil assessed will get phased out over the next nine years by repowering.”

Padmanathan confirmed that gas projects will still form part of ACWA’s portfolio but added the business would be “very careful and very selective” about the type of gas-fired power plant schemes it becomes involved in.

He said: “We are working with Saudi counterparts on how best to manage the portfolio in terms of carbon elimination.”

Padmanathan said the increasing reduction in the cost of producing renewable energy means even Middle East petrostates will be able to power their countries more cost effectively with green energy, particularly through increased investment in solar technology.

He said: “Conveniently, the cost comes down to such an extent that for a big part of the energy consumed today it is the cheapest option even for a country like Saudi Arabia, which is blessed with such a low cost of production of fossil fuels, to produce its energy.”

He added: “We have also been able to produce low-cost renewable energy through electrolysis to produce hydrogen, so can now contemplate producing green hydrogen [which doesn’t involve the use of fossil fuels].”

ACWA holds a one-third stake in the massive $5 billion Neom project which will be powered entirely by solar and wind, and will be one of the world’s largest green hydrogen plants when it opens in 2025.

 


Economists revise Saudi growth forecasts upward in 2022, Reuters poll showed

Economists revise Saudi growth forecasts upward in 2022, Reuters poll showed
Updated 9 min 16 sec ago

Economists revise Saudi growth forecasts upward in 2022, Reuters poll showed

Economists revise Saudi growth forecasts upward in 2022, Reuters poll showed

BENGALURU: Saudi Arabia, the world's largest crude oil exporter and the region's economic and political heavyweight, will see 5.1% economic growth next year after a modest 2.3% expansion this year and a sharp 4.1% contraction last year, according to a Reuters' economists poll.

That was an upgrade from the July Reuters poll and higher than the International Monetary Fund's 4.8% forecast for 2022, Reuters said.

Economies in the six-member Gulf Cooperation Council will grow faster next year than previously thought, according to a Reuters poll of economists who warned a decline in oil and gas prices was the biggest risk to their outlook.

The oil-rich region will benefit from an increased COVID-19 vaccination rate, rising oil prices and easing of lockdown restrictions this year and next, the poll suggested.

But while these may lift short-term economic prospects, they are vulnerable to the region's high reliance on global oil demand amid an economic slowdown in China, the world's largest crude importer.

Still, the Oct. 8-20 Reuters poll of 21 economists forecast an improvement in the economic fortunes of most oil-exporting nations after they were battered by the pandemic and the record collapse in oil prices last year.


Saudi Arabia's real estate prices jump by 0.5% in Q3 2021: GASTAT

Saudi Arabia's real estate prices jump by 0.5% in Q3 2021: GASTAT
Updated 31 min 16 sec ago

Saudi Arabia's real estate prices jump by 0.5% in Q3 2021: GASTAT

Saudi Arabia's real estate prices jump by 0.5% in Q3 2021: GASTAT

CAIRO: Annual real estate prices in the Kingdom rose by 0.5 percent in the third quarter of this year, official data revealed.

This was mainly driven by a yearly increase of 1.1 percent in residential land prices, the General Authority of Statistics said today.

 


The US has opened up its e-cigarette market – what's next for Egypt?

The US has opened up its e-cigarette market – what's next for Egypt?
Updated 21 October 2021

The US has opened up its e-cigarette market – what's next for Egypt?

The US has opened up its e-cigarette market – what's next for Egypt?

CAIRO: The US Food and Drug Administration finally approved the sale of three types of e-cigarettes last week, leaving business to ask what this means for the Egyptian market?

RJ Reynolds’ Vuse Solo e-cigarettes and two types of its tobacco-flavoured pods became the first-ever vapour products to win clearance from the US health watchdog.

The FDA decided after more than a year of tests that the benefit of the product to adults trying to quit smoking outweighs the risk of teenagers becoming hooked.

The regulator said the move was an “important step toward ensuring all new tobacco products undergo the FDA’s robust, scientific premarket evaluation”.

However, last Tuesday’s ruling came even as e-cigarettes have been widely available in the US for over a decade.

Yet this decision may pave the way to curb the widespread illegal trade in electronic smoking devices in Egypt.

The Egyptian Ministry of Health and Population recently warned against using e-cigarettes, saying that vaping contains nicotine and toxic substances that harm the smoker and those around them.

A ministry publication said that vaping can lead to chronic lung diseases, breathing problems and chest pain.

Western smoking products such as e-liquid pods carry a nicotine strength of 4.8%, roughly equivalent to a pack of cigarettes.

Nicotine is the chemical released when tobacco is smoked and is the addictive stimulant that gives users a rush. Vaping firms say their products provide smokers nicotine, with far fewer of the dangerous toxins contained in burning tobacco. 

Studies around the world are unclear on the health effects of e-cigarettes.

However, Fawzi Al-Hwaiti, a tobacco seller in central Cairo, is at the sharp end of the e-cigarette business in Egypt.

He stresses that only three types of vapes are authorized in Egypt, adding that he does not know whether the products he brings from dealers are legal or not. His prices range from EGP 600 to EGP 1,000.

Al-Hwaiti told Arab News: “It is not important that it be legal. The important thing is, it comes to me and I sell it and earn from it to support my family. I think it's legal because no one from the authorities has spoken to me before that.”

Some ordinary smokers hope that relaxation in the US will lead to a looser policy in Egypt.

The move by the FDA was welcomed by Engineer Islam Shawqi, a longtime smoker who decided to quit by taking up e-cigarettes.

He said: “I have smoked all my life, I have been a smoker for a long time, and I wanted to stop smoking. I resorted to smoking e-cigarettes, as I heard that they are less harmful.”

Shawqi believes that the approval of some types of vapes is the beginning of an opening up of trade in Egypt, that will help adult smokers like him.

However, the Egyptian Chambers of Commerce makes clear that the expansion of the e-cigarette market is in the hands of the government.

The business body said: "We have not received any notification, and I think that the Egyptian Ministry of Health must declare this matter first, before implementing it commercially.”

Robert Naous, Director of External Affairs, Middle East and North Africa, the leading e-cigarette maker Relx International expressed his happiness with lifting ban in Egypt, as he commented in a statement: “Lifting this ban in Egypt is a good and specific step in the right direction, which will greatly benefit the general investment environment in the country, by encouraging small and medium-sized companies and manufacturers to invest, opening new stores, and importing rechargeable vaping devices, thus creating new job opportunities. It is also certain that the state treasury will benefit by generating additional tax revenues in a sound manner, as it blocks the way for illegal merchants who evade import tax.”


Tesla hits record profit despite parts shortage, ship delays

Tesla hits record profit despite parts shortage, ship delays
Updated 21 October 2021

Tesla hits record profit despite parts shortage, ship delays

Tesla hits record profit despite parts shortage, ship delays

DETROIT: Record electric vehicle sales last summer amid a shortage of computer chips and other materials propelled Tesla Inc. to the biggest quarterly net earnings in its history.
The company said Wednesday that it made $1.62 billion in the third quarter, beating the old record of $1.14 billion set in the second quarter of this year. The profit was nearly five times larger than the $331 million Tesla made in the same quarter a year ago.
Revenue of $13.76 billion from July through September also set a record, but it fell short of Wall Street expectations of just over $14 billion, according to FactSet.
Excluding special items such as stock-based compensation, Palo Alto, California-based Tesla made $1.86 per share, beating analyst estimates of $1.62. CEO Elon Musk has said he's moving the headquarters to Austin, Texas, the dateline of Wednesday's earnings release.
Some of the quarterly profit, though, came from selling regulatory credits to other automakers. Tesla made $279 million on credits during the quarter.
"A variety of challenges, including semiconductor shortages, congestion at ports and rolling blackouts, have been impacting our ability to keep factories running at full speed," the company said in a statement to shareholders.
Earlier this month Tesla said it delivered a record 241,300 electric vehicles in the third quarter even as it wrestled with the shortages that have hit the entire auto industry. Most automakers reported sales declines in the U.S. last quarter due to chip and other shortages, including General Motors and Ford.
Previously, Musk has said Tesla kept its manufacturing lines running largely by finding chips from alternate suppliers and then scrambling to rewrite some of the software in its cars to ensure all the technology remained compatible.
Third-quarter sales rose 72% over the 140,000 deliveries Tesla made for the same period a year ago.
So far this year, Tesla has sold around 627,300 vehicles. That puts it on pace to soundly beat last year’s total of 499,550.
While sales grew in the third quarter, the average sales price fell 6% because Tesla is selling more less-expensive Models 3 and Y and fewer pricier Models S and X.
Tesla also took an impairment charge of $51 million due to a decline in value of its Bitcoin holdings.
Musk didn't appear on this quarter's conference call with with analysts and investors. He said previously that he would show up only when he had something important to say.
That left Chief Financial Officer Zachary Kirkhorn and Vice President of Vehicle Engineering Lars Moravy to answer questions.
Kirkhorn said the company was able to hit an operating margin — how much it makes pretax after variable production costs — of just under 15%.
But Kirkhorn said Tesla may face some difficulties in the future that could threaten that margin, including rising commodity prices and labor shortages. Tesla's biggest cost exposure is for nickel, which goes into battery cells, and aluminum, which the company uses for other nonbattery components, he said. Tesla also will face inefficiencies as it starts production at new factories in Texas and Germany next year, he said.
The company already is seeing commodity cost increases, which have resulted in price hikes, Kirkhorn said. Next year it's possible that Tesla will see more. "It's difficult to say precisely, but the volatility and the increases are just so substantial," he said.
Tesla executives also made their first public comment on multiple investigations of the company by U.S. safety regulators. Moravy said Tesla is cooperating as much as possible.
The National Highway Traffic Safety Administration has opened an investigation into why Tesla's Autopilot driver-assist system keeps running into parked emergency vehicles. Of the dozen crashes that are part of the probe, 17 people were injured and one was killed.
The safety agency also is questioning why Tesla didn't recall vehicles with Autopilot when it did an over-the internet software update so they better recognize firetrucks and police cars in low light. NHTSA said the update addressed a safety defect.
Kirkhorn said safety is important to Tesla as the auto industry transitions from traditional cars to being more software-oriented. “Regulatory bodies, and understandably so, are interested in understanding how to regulate in this environment, and NHTSA is no exception,” he said. “Were excited to partner and we'll work collaboratively with all the different regulatory bodies.”
Tesla hasn’t always cooperated with the safety agency, though. In January, Tesla resisted a request from NHTSA to recall about 135,000 vehicles because their touch screens could go dark. The agency said the screens were a safety defect because backup cameras and windshield defroster controls could be disabled.
A month later, after NHTSA started the process toward holding a public hearing and taking Tesla to court, the company agreed to the recall.
In its shareholder statement, Tesla also said that construction of its new factory near Austin is progressing as planned and it’s preparing equipment and “fabricating our first pre-production vehicles.”
The factory, which is centrally located versus Tesla’s other assembly plant in Fremont, California, will send Model Y small SUVs and new Cybertruck pickups to East Coast population centers.
Tesla said it expects to expand its factory capacity quickly, and over a “multi-year horizon” it expects sales to grow an average of 50% annually.
Shares of Tesla Inc. fell 1.6% to $851.80 in after-hours trading Wednesday.