Sign up: With one click, get this newsletter delivered to your inbox.
Continue Reading Below
One of the world's biggest industrial behemoths is preparing to get smaller. General Electric Co.'s new leader outlined a restructuring plan that will streamline the company's operations and store more cash, the WSJ's Thomas Gryta reports, as the 125-year-old business adjusts to big changes in its core markets. The leaner business will mean shedding its iconic lighting business and its transportation unit, one of the oldest and biggest makers of diesel locomotives. GE will focus instead on aviation, power and health units that together provide about 58% of its revenue. The GE Aviation business is one of the world's top makers of jet engines and has a healthy pipeline of orders. The company is also looking to sell its majority stake in oil-field services provider Baker Hughes. Slimming down is an unusual corporate move in an era of consolidation, but Chief Executive John Flannery suggested in addressing the company's simpler accounting that there are benefits to streamlining, saying "complexity has hurt us."
New natural-gas agreements with China are raising expectations for investment in export facilities in several U.S. states, but those hopes may be built on air. The deals announced in China during President Donald Trump's state visit last week total tens of billions of dollars in plans for pipelines and other infrastructure in Alaska, West Virginia and Texas, Nathaniel Taplin writes in the WSJ's Heard on the Street. The agreements are for brick-and-mortar projects, however, and there are high hurdles to getting liquefied natural gas plants completed. Building such plants is a notoriously expensive and lengthy proposition, and the Asian gas market is forecast to be oversupplied until the early 2020s at least, making LNG projects highly risky. Terminals approved in Australia during the height of the commodities boom nearly all ran massively over budget, and exporters there now are coping with depressed prices for gas in Asia.
The turmoil in the offshore drilling business is getting deeper. Pacific Drilling SA became the second big international ocean-going oil and gas driller to file for bankruptcy in the past three months, the WSJ's Tom Corrigan reports, as it seeks to restructure some $3 billion in debt and adjust to a fast-changing energy environment. The business joins a number of other debt-laden offshore drillers and service providers filing for bankruptcy protection in the U.S. after succumbing to low oil prices, excess capacity and heavy debt loads. Seadrill Ltd., owned by shipping magnate John Fredriksen, sought chapter 11 protection from creditors in September, and the company disclosed in new court papers that it paid $100 million to bankruptcy professionals before entering court. Pacific Drilling has seven drillships, which it says are among the most advanced in the world. The company has also been involved in a $350 million legal battle with Samsung Heavy Industries Co. over a ship it says was never delivered.
ECONOMY & TRADE
Shipping operators probably shouldn't get too accustomed to the trade surge that's fueling bigger freight flows. Trade has been soaring this year as an upturn across major global economies picks up momentum and raises hopes that emerging markets are ready to rebound. The WSJ's Jon Emont writes that global trade still faces stiff headwinds, however, with concerns such as demographic trends and the cyclical nature of some commodities trade prompting a more cautious outlook. Much of the export growth in Asia this year comes from a jolt in demand for semiconductors, for instance, and forecasters expect expansion there to level off as supply catches up with demand. The World Trade Organization has upgraded its growth forecast for world trade this year to 3.6% -- strong by recent standards but well behind growth rates before the financial crisis. Any pullback in demand would hit hard in the shipping world and undercut container lines that are scaling up orders for bigger ships following this year's reviving demand.
Continue Reading Below
IN OTHER NEWS
The pound fell by as much as 1% against the dollar on concerns about the state of British politics. (WSJ)
Qualcomm Inc. rejected Broadcom Ltd.'s unsolicited takeover offer, setting up a potential hostile showdown between two giants of the chip industry. (WSJ)
A Chinese company's $1.1 billion deal to purchase an American metals producer collapsed following U.S. opposition to the agreement. (WSJ)
Bombardier Inc.'s rivals will pursue legal complaints against the aircraft maker despite the company's move to give Airbus SE control of its CSeries plane project. (WSJ)
Workers at the Chinese-owned Fuyao Glass auto parts factory in Ohio rejected a bid to join the United Auto Workers union. (Agence France-Presse)
The state of South Carolina asked a court to compel Amazon.com Inc. to collect sales taxes for its third-party sellers. (CNBC)
New rules in Japan will require truck drivers be paid for tasks that are separate from driving, such as waiting at loading docks. (Yomiuri Shimbun)
Tesla Inc. faces a faltering market for solar panels as it prepares to open its Buffalo, N.Y., factory. (Buffalo News)
Apple suppliers fueled a 6.3% surge in revenue at Taiwan's major technology companies in October. (Nikkei Asian Review)
Canada's lobster farmers are seeing a boom in exports as the country pushes new trade agreements. ( New York Times)
Chinese e-commerce retailer JD.com swung to a $150 million third-quarter profit on a 38.5% increase in direct sales. (South China Morning Post)
A Deloitte study shows supply-chain fraud has barely been reduced despite the growing use of anti-fraud analytics. (Supply Chain Management Analytics)
Cathay Pacific Airways Ltd. will sell eight freighters to DHL and lease them back as part of a deal to gain full control of cargo airline Air Hong Kong. (Reuters)
Third-quarter air freight tonnage at Expeditors International of Washington Inc. rose 12% while ocean container volume grew 4%. (American Shipper)
Multipurpose ocean cargo carrier Swire Shipping will start monthly service between Oregon's Port of Portland and Australia and New Zealand. (Portland Business Tribune)
Former Maersk Group chief executive Nils Andersen became chairman of European regional operator Unifeeder. (Lloyd's List)
North Dakota potato farmers face heavy competition getting trucks to handle a strong harvest this fall. (Grand Forks Herald)
Paul Page is deputy editor of WSJ Logistics Report. Follow him at @PaulPage, and follow the entire WSJ Logistics Report team: @brianjbaskin , @jensmithWSJ and @EEPhillips_WSJ. Follow the WSJ Logistics Report on Twitter at @WSJLogistics.
Write to Paul Page at firstname.lastname@example.org
(END) Dow Jones Newswires
November 14, 2017 06:54 ET (11:54 GMT)