Is BMW Planning To Take on Tesla?
With the help from Toyota (TM, -1.42%), BMW has embraced gasoline-electric hybrids as well as pure electric cars. In addition, the company is also getting back into hydrogen cars as a result of its two new electric models. On the one end, we have the BMW i8 which has been positioned as a halo sports car model and as such, this model is more costly compared to BMW’s second model, the BMW i3 which is a more affordable option. Reuters has reported that BMW is now considering the production of an electric luxury sedan. Recent reports have indicated that BMW is likely to offer a potential BMW i5 model which will be available as a pure electric car as well as a plug-in hybrid. In this way, consumers will have the flexibility to select a green car which is designed based on their specific needs. In terms of design, BMW is expected to replicate the general size and layout of the 5-series with a distinctive interior packaging. Meanwhile, Porsche is also taking on Tesla’s Model S with their smaller hybrid sedan which is currently being named as the Pajun. We can expect to see a concept form of the Pajun on the 17th of September at the Frankfurt Motor Show. Interestingly, three years ago, reports about the Pajun emerged and now with the promises of a 300-hp Tesla Model S fighter, Porsche is stepping up its game. The Tesla (TSLA, -1.91%) sedan has been on the market for quite some time now and with the emergence of other electric cars being introduced by German manufacturers in recent years, it is now only a matter of time until Tesla’s Model S is taken on directly. The big question is which major manufacturer is going to take first place against Tesla?
After trading at some of their lowest levels of the day, U.S. stocks climbed on Wednesday but still remained low. This came after the minutes from the July meeting of the U.S. Federal Reserve’s indicated that conditions for raising rates for the first time in almost ten years are “approaching.” Based on comments from Fed Chair Janet Yellen, a September rate increase may be on the table. Despite these comments, the Fed did state that they would still remain cautious as a result of global markets such as the slowdown in China which has negatively impacted commodity prices. At the close of trading, the Dow Jones Industrial Average (DJIA) dropped 0.4%, or 78 points, to 17,434. This decline was impacted by a drop in the share price of Chevron Corp. (CVX, -2.79%) which dropped 2.3%. Also on the downside was the S&P 500 index (SPX) which declined 0.4%, or 9 points, to 2,087.97. The poorest performer was the energy sector, down by more than 2 percent, as a result of a decline in oil prices. Following the downward trend was the Nasdaq Composite Index (COMP) which dropped 0.3%, or 16 points, to 5,042.
On Wednesday, the U.S. dollar traded lower. This came after data showed that the inflation in the U.S. rose at a slower pace than expected in July. According to the Labor Department, the CPI (consumer price index) rose in July by only 0.1%. This missed analysts’ expectations for a gain of 0.2%. Also, underlying inflation, which excludes costs for energy and food, rose 1% which also missed expectations for a gain of 2 percent. The EUR/USD traded at 1.1052, up 0.26% while the GBP/USD traded at 1.5643. This was just below the 7-week high of 1.5716 set on Tuesday. Against the currency in Canada, the U.S dollar traded higher with the USD/CAD trading at 1.3134, up 0.61% while the NZD/USD was down to 0.6571. Also, the US dollar index declined to 96.92.
In early Asian trading on Thursday, crude oil prices declined sharply. This came in response to an oversupply in the global and U.S. markets which pushed prices below the $41 a barrel mark. In addition, negative investors’ sentiment regarding the weak demand out of China was evident. WTI crude oil for delivery in October traded at $40.91 a barrel, down 0.88%, on the New York Mercantile Exchange. Also, Brent crude oil for delivery in October moved between $46.83 and $49.10 a barrel. The contract finally settled at $47.10 a barrel, down 3.50%, or $1.71, on the Intercontinental Exchange (ICE). The current spread between the international and U.S. benchmarks of crude is currently at 5.87.