international

Nissan Motor Co. is reportedly in advanced discussions to manufacture vehicles for Honda Motor Co. in the United States, according to the Nikkei, as the carmaker seeks to optimise operations at its under-utilised production facility in Mississippi. The Canton plant, located in Mississippi and currently responsible for models such as the Nissan Frontier, is being considered for the production of Honda pickup trucks, the report stated. The potential collaboration marks a shift in strategic direction for the two Japanese automakers, particularly following the collapse of earlier merger talks aimed at creating the world’s third-largest car manufacturer. Despite the breakdown of merger discussions earlier this year, both companies have reiterated their commitment to continuing cooperation in key areas, including electric vehicle (EV) development. In a brief statement issued on Friday, Nissan confirmed that it had no further updates at this time but emphasised that joint projects with Honda remain ongoing. The company declined to comment on what it characterised as market speculation. Honda representatives were not immediately available for comment. Nissan’s drive to streamline its global operations comes amid significant financial challenges. The company reported a net loss of US$4.5 billion for the financial year ending in March. With declining sales and an ageing product portfolio, Nissan faces mounting pressures, including a maturing debt portfolio of approximately ¥700 billion (US$4.8 billion) due this year. Its credit ratings have been downgraded to junk status by all three major agencies. Under the leadership of newly appointed CEO Ivan Espinosa, Nissan has initiated a comprehensive restructuring plan that includes the closure of seven manufacturing plants and a 15% reduction in its global workforce. The proposed manufacturing agreement with Honda, if finalised, could provide much-needed operational efficiency for Nissan while giving Honda added production capacity in the US market. Both companies continue to contend with growing competition from Chinese manufacturers and trade uncertainties surrounding US-Japan negotiations on automotive tariffs. -Reuters

Volkswagen Group has confirmed the closure of one of its manufacturing plants in China, underscoring its accelerating shift towards electric mobility in the world’s largest automotive market. A spokesperson for the German automaker said production had ceased at a facility in Nanjing, operated jointly with Chinese partner SAIC. The decision, initially reported by Handelsblatt, reflects both the declining demand for internal combustion engine vehicles and broader strategic objectives tied to electrification. “Volkswagen Group and its joint venture partners are accelerating the transformation towards electric, intelligent, connected vehicles,” the spokesperson said. “Many SAIC Volkswagen sites are currently being converted or have already been converted for electric vehicle production.” According to a company source, the Nanjing plant’s location within a dense urban setting complicated the retrofitting process for electric vehicle production and limited potential expansion opportunities. Electric vehicle sales continue to gain traction across China, placing mounting pressure on traditional European manufacturers. Volkswagen, long dominant in the Chinese market with its petrol and diesel offerings, has seen its position challenged in recent years by agile local competitors such as BYD. As part of its “In China, for China” initiative, Volkswagen is leaning more heavily on domestic expertise to realign its operations with local market demands. The company confirmed that its production network is undergoing optimisation in line with this renewed strategic focus. Volkswagen also disclosed a 2.1% decline in vehicle deliveries in China for the first half of 2025. While the drop reflects ongoing competitive pressures, it marks an improvement over the 7.4% year-on-year fall reported during the same period in 2024. -AFP

Taiwan Semiconductor Manufacturing Company (TSMC) has reported a 40% increase in revenue for the first half of the year, driven by strong global demand for artificial intelligence technologies. The world’s leading contract chip manufacturer recorded NT$1.77 trillion in revenue, compared to the same period last year, underscoring its strategic position in the rapidly evolving semiconductor market. The company, whose clientele includes global technology leaders such as Nvidia and Apple, attributed the robust performance to sustained momentum in AI-driven innovation. Chairman and Chief Executive Officer CC Wei recently stated that TSMC anticipates record earnings for the full year, citing continued strength in AI-related demand. TSMC has also benefited from a recent acceleration in sales, a trend partly attributed to geopolitical trade tensions. Specifically, former US President Donald Trump’s tariff measures prompted many firms to increase inventory levels amid concerns over potential future levies. During a shareholder meeting in June, Wei acknowledged that escalating tariffs could influence pricing and downstream demand, but reaffirmed confidence in the company’s outlook, stating, “Our business will still be very good.” Meanwhile, Taiwan’s government has confirmed it has not yet received official communication regarding US tariff measures, as discussions remain ongoing in Washington. In contrast, neighbouring countries including Japan and South Korea are among over 20 nations that have been formally notified of potential “reciprocal” tariffs set to take effect from 1 August. In an effort to mitigate potential trade impacts, Taipei has sought to strengthen its economic and strategic ties with the United States. This includes commitments to increased investment in US markets, greater purchases of American energy, and enhanced defence spending. -AFP

Fast Retailing, the Japanese parent company of global apparel brand Uniqlo, has warned that higher US tariffs will significantly affect its American operations from later this year. In response, the company plans to implement selective price increases to offset rising import costs. Concerns over a resurgence in inflation and broader economic instability have been heightened by US President Donald Trump’s unpredictable tariff measures. These actions have already dampened consumer sentiment across major retail markets, including the United States. Earlier this week, President Trump announced a new deadline of 1 August for the implementation of “reciprocal” tariff rates, which are expected to apply broadly to nearly all US trading partners. “It is unavoidable that we will be significantly affected from autumn and winter,” said Takeshi Okazaki, Chief Financial Officer of Fast Retailing, during the company’s quarterly earnings briefing. “It will be difficult to absorb all costs. Our approach will be to raise prices where possible and not where it isn’t possible, while ultimately focusing on creating a sustainable business that securely generates profits.” A large proportion of Uniqlo’s US inventory is sourced from manufacturing hubs in Southeast and South Asia. In a formal notification on Wednesday, President Trump confirmed that Sri Lanka—an important apparel exporter to the US—would face a 30 per cent tariff beginning 1 August. Vietnam, another key supplier, will be subject to a 20 per cent tariff, although products trans-shipped through Vietnam from third countries will be subject to a steeper 40 per cent levy. For the current financial year ending August, Fast Retailing maintained its operating profit forecast at ¥545 billion, citing the benefit of early product shipments to the US market. “FY2025 impact likely to be limited, whatever the tariff rate,” the company stated in its earnings release, noting that a substantial portion of merchandise had already been delivered to the United States. In the three months to 31 May, operating profit rose 1.4 per cent to ¥146.7 billion (approximately US$1.0 billion), falling short of the ¥153.8 billion consensus estimate from five analysts polled by LSEG. Founded with a single store in Hiroshima four decades ago, Uniqlo has expanded to more than 2,500 locations worldwide. Its business model—selling affordable fleece and cotton garments primarily made in China and other Asian markets—has come under pressure from shifting geopolitical trade dynamics and weakening consumer demand in key regions. Sales in China, Uniqlo’s largest overseas market with over 900 stores, have declined amid broader economic uncertainty. The company anticipates lower revenue and profits in China for the fourth quarter, citing subdued demand for apparel. With growth slowing in China, Fast Retailing has shifted focus towards expansion in North America and Europe. However, shares in the company have struggled, falling approximately 8 per cent in the first half of 2025—ranking it the fourth-worst performer among Asia-Pacific large-cap stocks, according to LSEG data. Shares closed down 0.9 per cent ahead of the earnings release.

Indonesia’s national carrier, Garuda Indonesia, will increase its planned aircraft order from Boeing to 79 planes, according to State-Owned Enterprises Minister Erick Thohir. The announcement forms part of a broader trade strategy involving ongoing negotiations with the United States over impending import tariffs. Speaking at the legislative complex in Senayan, South Jakarta, on Tuesday, Minister Thohir stated the new agreement replaces a previously cancelled deal that was annulled during Garuda’s court-supervised debt restructuring process (PKPU). “The new total is 79 aircraft,” he said, as reported by Kumparan. The revised order marginally exceeds earlier projections of 50 to 75 planes, which had been disclosed by Garuda Indonesia’s President Director, Wamildan Tsani Pandjaitan, earlier this month. While discussions with Boeing remain at a preliminary stage, Wamildan noted that the airline is likely to acquire the 737 Max and 787 Max models. The agreement is part of Indonesia’s wider diplomatic effort to respond to a 32% import tariff imposed by the US on Indonesian goods. Although US President Donald Trump has delayed implementation, he warned President Prabowo Subianto in a recent letter that the tariff would take effect from 1 August unless a new agreement is reached. Minister Thohir underscored that the aircraft deal aligns with the government’s broader objectives of reducing trade imbalances and boosting energy security. He noted that both Garuda Indonesia and state-owned energy firm Pertamina are supporting the trade discussions with Washington. “This is also about strengthening our energy self-sufficiency through overseas investment via Danantara, and addressing our aircraft shortage,” he said. As part of Indonesia’s counter-proposal, the government has committed to up to US$34 billion in US imports, focusing largely on crude oil and aircraft. Pertamina is expected to be the major contributor to this import figure. Garuda Indonesia is also set to receive 6.65 trillion rupiah in funding from the state asset management agency Danantara. A substantial portion of this capital will be directed towards its low-cost subsidiary, Citilink Indonesia. The Ministry of Energy and Mineral Resources has confirmed that plans are progressing to import oil and gas from the United States. Deputy Energy Minister Yuliot Tanjung stated that the government awaits the outcome of negotiations led by Coordinating Minister for Economic Affairs Airlangga Hartarto, who is currently in Washington. “We’ve achieved a trade balance of around US$15 billion on the energy side. We will wait for Pak Airlangga to conclude negotiations with the United States,” said Yuliot, during an oil and gas forum on Tuesday, as reported by Bloomberg Technoz. Indonesia has proposed a series of concessions in the ongoing bilateral talks aimed at averting the tariff. However, analysts have warned that a comprehensive agreement may prove challenging to secure. “The government will maximise all available opportunities to safeguard national interests,” said Haryo Limanseto, spokesperson for the Ministry of Energy and Mineral Resources. -The Jakarta Post