TPT January 2012

G lobal M arketplace

ArcelorMittal, of Luxembourg, the world’s largest steel producer, is funding up to $30mn of the $35mn project, with the London Development Agency providing the remainder. The 375-foot Orbit, whose two viewing platforms will offer vistas across the city, is twice the height of Nelson’s Column in Trafalgar Square and 72 feet higher than the Statue of Liberty. An ebullient Mayor Boris Johnson – who received the backing pledge from another Londoner, steel mogul Lakshmi Mittal, at the 2009 World Economic Forum in Davos, Switzerland – was inspired to make other comparisons. “It would have boggled the minds of the Romans,” Mr Johnson exulted in a statement. “It would have dwarfed the aspirations of Gustave Eiffel. And it will certainly be worthy of the best show on earth, in the greatest city on earth.” Automotive A lighter, stronger, safer steel is set to be used extensively on next-generation models from Mazda and Nissan One day after Mazda announced that its 2012 CX-5 crossover will be the first production vehicle ever to feature ultra-high tensile steel, Nissan declared that its cars will do likewise, starting in 2013. Additionally, reported Viknesh Vijayenthiran of motorauthority.com (5 October), Nissan said that its cars will use only 1,200 megapascal (mpa) – approximately 174,000 psi – steel versus 1,800mpa for Mazda’s. As well as promising greater safety and improved gas mileage, the rigid and lighter-weight steel provides the two Japanese producers with an alternative to more expensive aluminium. As noted by Mr Vijayenthiran, Nissan’s ultra-high tensile steel was developed in collaboration with Nippon Steel Corp and Kobe Steel. The car maker intends to use it in cold-pressed body parts for a projected savings of up to 33 pounds on some models. Key structural parts include centre pillar reinforcements and front and side roof-rails. For its part, Mazda will use its new steel in the body of the CX-5, and expects to realise a weight savings of 10.5 pounds on the bumpers alone. The stronger front and rear bumpers will absorb energy on impact, thus limiting damage to both vehicle and occupants. Mazda worked throughout with Sumitomo Metal Industries on parts development. The CX-5 crossover is set to launch early in the New Year. Sweden’s Saab wins a reprieve and the prospect of a ‘second home market’ in China For a second time in less than two years, Chinese investors have acted on an attraction to the Swedish auto industry. In 2010, the Zhejiang Geely Holding Group paid Ford Motor Co $1.8bn for Volvo. Then, this past October, Saab’s parent company, Swedish

Automobile, announced that Zhejiang Youngman Lotus Automobile and Pang Da Automobile Trade had agreed to pay $140mn for Saab and its British unit. The offer came just hours before the company faced court action that could have led to its liquidation. The two Chinese companies had earlier agreed to pay a combined $347mn for a 54 per cent stake in Saab after money troubles had forced the shutdown of its main factory in Trollhattan, Sweden. But negotiations languished, leaving the car maker in an increasingly untenable position. Martin Skold, a scholar at the Stockholm School of Economics who follows the auto industry, told the International Herald Tribune (28 October) that it was too early to declare the last-minute rescue attempt a success. “Saab is in great need of an enormous amount of money,” he said, estimating that it would take at least $800mn and possibly as much as $1.5bn to turn the company around. “We’ll have to wait to see how much the Chinese are willing to invest in it.” They possibly will be willing to venture a considerable amount. The Tribune ’s David Jolly observed that, despite its inability to right itself for very long at a time, Saab “has a long-established base of dedicated customers.” In the right hands – Youngman’s and Pang Da’s, perhaps – the famous unshakable bond between a Saab and its owner could be worth much. Clearly Victor R Muller, the Dutch entrepreneur who acquired Saab from General Motors of the US in 2010, has high hopes for the company under Chinese auspices. In a conference call with journalists reported in the Tribune , he said that Youngman and Pang Da are to resume production at the Trollhattan plant; also to start up in China, “which will become the second home market for Saab.” › Mr Jolly noted a few interim steps on the way to that goal. The deal requires the approval of authorities in Beijing, and must also pass muster with the European Investment Bank and the Swedish government, both lenders to Saab. Another interested party is GM, whose lingering links to Saab include intellectual property and preferred shares with a face value of $326mn. Oil and gas The rush is on to capitalise on growing demand for liquefied gas Energy companies in the US, Canada and Australia are planning or have begun on more than a dozen projects to liquefy and export natural gas. Writing from Houston, Texas, in the Wall Street Journal , Daniel Gilbert and Guy Chazan declared Asia the hottest market. According to the New York-based advisory firm Poten & Partners, Asian demand for liquefied natural gas, or LNG – converted temporarily for ease of transport – is expected to grow 68 per cent between 2010 and 2020. The US moved a step closer to becoming a major exporter of natural gas when BG Group agreed to buy LNG from a facility on the Gulf Coast to supply Asian and European markets. As noted by

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