What's really going on for Tesla in China? Global supply chains remain fragile as the Chinese flex their muscles and national buying power. That may prove problematic for western firms, and especially Tesla. But also it raises questions about investment imperatives on China growth vs flatline in the West.
There is lots to be positive about this morning. The first headline to catch my eye was a prediction from Goldman Sachs raising their target to 7.8% UK growth in 2021 – up from the 5% consensus. Great stuff! A colleague sent me the FT's analysis of the Pandemic end-game: 5.2% people have been infected last week, but vaccines are clearly working and saving lives. And there are some spectacular company results hitting the screens.
But across the globe supply chain ructions continue. Jaguar Land Rover has shut down a number of factories over the global shortage of chips. There are warning of everything from autos, fridges, toasters to airplanes being delayed due to apparent hoarding by Chinese manufacturers concerned about possible sanctions if the current cold war heats up.
We have a global explosion of repressed consumer spending set to hit the market.
There is a global shortage of goods. (I know this – it looks like our new kitchen will have a wine-chiller shaped gap due to the lack of supply! Shocking…. Simply shocking…)
There is the threat of further supply shocks on the back of rising trade and cold-war ructions.
The world is less stable than we hope. And it boils down to a very simple question. What's really happening in China? That, I suspect, is the critical factor when it comes to predicting just how strong pandemic recovery will be, or how constrained it may become.