May 15 Editorial
Concern for the Canadian automotive industry was intensified at the end of April when General Motors announced it will be halting production of the Chevrolet Camaro at its Oshawa plant as of November 20 and moving the work to Grand River, Michigan. It means 1,000 of the 3,500 assembly-line positions will be eliminated. It’s believed 2,100 workers are eligible for early retirement incentives, which will help soften the blow, but it’s clearly an ominous sign for production opportunities in the future. It’s hoped that negotiations between the company and UNIFOR can result in an agreement on a new labour contract for another GM product next year, but by no means is anything guaranteed.
“You deserve a break today” is a well-known branding catchphrase from McDonald’s, but the fast-food giant may be wishing it were getting a better break following another dreadful financial quarter in which net income plummeted 33% to $811.5 million, or 84 cents a share, from $1.2 billion, or $1.21, a year earlier. CEO Steve Easterbrook is promising a big turnaround, but it’s not going to be easy in what is now a far more health-conscious society. Ordering a light salad and low-calorie diet shakes from McDonald’s somehow seems counterintuitive to going there in the first place, and unlikely to provide a winning solution for enhancing competitiveness. If the plan is to bring in new customers (and get many of the previous ones back) by offering genuinely healthier meals, they’ve got a lot of work in front of them, both from a menu and public perception point of view.
Despite already being the largest company in the world, U.S. billionaire and activist investor Carl Icahn believes Apple Inc. remains undervalued at about $125 per share. The California-based company posted an impressive 33% increase in profit the last quarter due to a strong demand for the iPhone and a jump in sales in China, so Icahn may well be right. Meanwhile former competitor Nokia is denying reports from China that it had secretly been planning to return to phone manufacturing. However, the Finnish-based enterprise is looking into returning to the smartphones business by brand-licensing.
It looks as if BCE and businessman Larry Tanenbaum are set to acquire the Toronto Argonauts of the CFL. Interestingly the third part of the MLSE triumvirate – Rogers Communications – has zero desire in being part of the planned takeover of the good-ship Argonaut, which would have sunk to the bottom of Lake Ontario by now had current owner David Braley not been willing and able to lose millions of dollars since acquiring the franchise in early 2010. The Argonauts are the last major Toronto sports team not controlled by either BCE or Rogers Communications. It appears that’s about to change.
Did you know? David Braley has owned three of the CFL’s nine teams. He first owned the Hamilton Tiger-Cats and is the current owner of both the B.C. Lions and Toronto Argonauts.