Business News: Live Updates – The New York Times

  • by

Daily Business Briefing

Aug. 24, 2021, 1:17 p.m. ET

Aug. 24, 2021, 1:17 p.m. ET

The Boeing airplane assembly plant in Everett, Wash.
Credit…Ruth Fremson/The New York Times

The Federal Aviation Administration is looking into Boeing’s corporate culture, which an agency official said “appears to hamper” Boeing employees responsible for providing oversight, raising safety concerns and otherwise representing the agency’s interests.

In a letter to the company last week, the official, Ian Won, said that the F.A.A.’s review was based on a recent survey of a few dozen of the 1,400 Boeing employees who work on the agency’s behalf through a program called Organization Designation Authorization. Boeing’s structure appears “to provide a strong influence” over how those employees are appointed, managed and allowed to work, he said, providing “ample opportunity for interference rather than independence.”

“These concerns require an objective review and further fact finding,” Mr. Won wrote in the letter, which was obtained by The New York Times.

The F.A.A. review was reported earlier by The Wall Street Journal.

The agency’s reliance on company employees to review regulatory compliance has been criticized as allowing the aviation industry to police itself. But defenders say the arrangement is necessary because the F.A.A. lacks the resources for thorough oversight of the sprawling industry.

Last week’s letter was based on a survey of 32 employees in May and June. Nearly a dozen workers complained or shared stories that suggested Boeing had made it difficult for them to act with independence, the agency said.

According to excerpts from the survey responses, the concerns included finding that management would stall when design issues were raised so that the company could continue delivering planes and feeling that a manager would shop around for approval if an employee didn’t provide it.

In a statement, Boeing said it took the concerns seriously.

“We have consistently reinforced with our team that delegated authority is a privilege and that we must work every day to be trusted with the responsibility,” the company said. “We have taken steps to educate our team and make improvements.”

In the letter, the F.A.A. said it would conduct a broader survey of the employees designated to represent its interests. The company said it was working with the agency.

Fireworks at Walt Disney World in July. Disney World said Monday that unions representing more than 30,000 employees had agreed to a vaccine mandate.
Credit…John Raoux/Associated Press

When the Food and Drug Administration granted full approval to the Pfizer-BioNTech coronavirus shots for people 16 and older on Monday, President Biden seized on the moment.

“If you’re a business leader, a nonprofit leader, a state or local leader, who has been waiting for full F.D.A. approval to require vaccinations, I call on you now to do that,” the president said. “Require it.”

The F.D.A. approval gives companies more cover to impose vaccine mandates and industry groups more ground to lobby local authorities, the DealBook newsletter reports. Some states have moved to block vaccine mandates. Arizona’s governor, for example, issued an order outlawing coronavirus vaccination as a requirement for employment.

Those actions made it difficult for companies with large national footprints to impose blanket mandates. Some have pushed back, like Norwegian Cruise Line in Florida, but most have stayed out of the fray.

Companies that do require vaccinations are finding growing support.

“Many companies have made the decision to mandate vaccines for some or all of their employees, and we applaud their decision,” the Business Roundtable, a lobby group, said Monday in a statement. “We also encourage policymakers, including at the state and local levels, to support — not impede — companies’ ability to make such a decision.”

More public sector employers are introducing mandates, easing the way for private employers to make similar moves. New York said it would require all 148,000 employees of the city’s Education Department to be vaccinated. The Pentagon is demanding that its 1.4 million service members receive the shot by the middle of next month.

Some of the latest corporate mandates:

  • Chevron is mandating vaccines for expats and for employees who travel internationally, as well as for the offshore work force in the Gulf of Mexico and for some onshore support personnel.

  • CVS Health says its pharmacists have until Nov. 30 to be fully vaccinated, while others who interact with patients, and all corporate staff, have until Oct. 31. The mandate covers about 100,000 employees.

  • Disney World said unions representing more than 30,000 employees had agreed to a mandate, citing the F.D.A.’s full approval, that would require workers to be vaccinated by Oct. 22.

Mandates may be the only way to significantly increase vaccination rates, given continued hesitancy about the shot. A recent poll found that three out of 10 unvaccinated people said that they would be more likely to get a fully approved F.D.A. shot, though some experts believe that this figure could be exaggerated.

More regulatory action is coming. Moderna’s application for full approval of its vaccine was filed in June, a month after Pfizer’s. Johnson & Johnson is expected to apply for full approval soon. And the F.D.A. is also weighing whether to authorize booster shots for the fully vaccinated, another twist for corporate vaccine mandates.

Shopify said it was rolling out a program to hundreds of merchants in the United States and Britain for in-app shopping on TikTok.
Credit…Ian Austen/The New York Times

TikTok and Shopify, the e-commerce platform, said on Tuesday that they were working together to add the ability for consumers to shop directly in the TikTok app for the first time.

TikTok has largely been known as a video app that provides entertainment and memes. Users have not been able to buy products directly in the app, even though TikTok features many influencers who often talk up clothing, makeup and household products. Instead, users have only been able to buy goods on TikTok through ads on the app.

But under the new partnership, Shopify merchants that participate in a pilot program will be able to add a shopping tab to their profiles and link to products within TikTok posts. Shopify said it expected to expand the feature to all of its merchants this fall.

TikTok joins Instagram and Facebook in offering in-app shopping, part of a larger shift toward what is known as social commerce — buying products directly within a social media platform — as creators seek out new ways to make money from their audience.

“Social commerce is important because it’s the new town square” where consumers go to find and buy new products, Harley Finkelstein, Shopify’s president, said in an interview.

The move into in-app shopping reflects how people already use the app to find products, said Blake Chandlee, TikTok’s president of global business solutions. The app has inspired two-thirds of users to shop even when they weren’t planning to do so, according to a survey that TikTok conducted in the fall with the London market researcher Walnut Unlimited. The hashtag #tiktokmademebuyit has 4.6 billion views.

One of the merchants that is part of the new pilot program is Kylie Cosmetics, Kylie Jenner’s makeup and skin-care brand, which has two million followers on TikTok. Ms. Jenner’s personal TikTok account has 34.9 million followers.

Social media is “where I grew my audience and community,” Ms. Jenner wrote in an email. “The ability to shop my products directly on these platforms is so important because that’s where our audience is going first.”

Shopify said sales on its social commerce channels — including TikTok, Facebook, Instagram, Snapchat and Pinterest — grew 76 percent from February 2020 to February 2021. In total, Shopify works with 1.7 million merchants.

Families who were evacuated from Afghanistan waited on Monday to board buses at Washington Dulles International Airport in Virginia.
Credit…Jose Luis Magana/Associated Press

Airbnb and its charitable arm, Airbnb.org, said on Tuesday that the company intended to provide free temporary housing globally for 20,000 refugees fleeing the Taliban’s takeover of Afghanistan.

As American and European governments race to evacuate tens of thousands of people, the property rental company called the displacement and resettlement of refugees a “significant humanitarian crisis.”

The cost of the accommodations will be covered with money from Airbnb and its chief executive, Brian Chesky, as well as contributions from the Airbnb.org Refugee Fund, which was begun in June with the goal of raising $25 million. The organization is working with resettlement agencies and offered to support federal and state governments.

“The displacement and resettlement of Afghan refugees in the U.S. and elsewhere is one of the biggest humanitarian crises of our time. We feel a responsibility to step up,” Mr. Chesky said on Twitter.

“I hope this inspires other business leaders to do the same. There’s no time to waste,” he added.

Airbnb did not specify how long refugees could stay in the apartments or houses, but said its hosts were offering short- and long-term stays. The company said it had begun supporting Afghans fleeing the country last week when it gave funding to the International Rescue Committee and other organizations to provide temporary stays using the Airbnb platform for up to 1,000 refugees.

Over the weekend, Airbnb said, it placed 165 refugees in housing across the United States, including in California, New Jersey, Ohio, Texas, Virginia and Washington State.

Hedge funds have trailed the market for many months. Part of the reason, the DealBook newsletter reports, is that their favorite stocks, as measured by a Goldman Sachs index of the most heavily owned shares by hedge funds, have risen just 4 percent in the past six months, versus 16 percent for the S&P 500.

Six-month price performance

Hedge funds were caught off guard by Beijing’s corporate crackdown. Asian stocks, especially ones exposed to China’s rapidly growing economy, have long been favorites of hedge funds, which search for higher-than-average returns to justify their higher-than-average fees. But China’s recent crackdown on its largest tech companies, particularly those with U.S. listings, has hit those bets hard.

Goldman said that about a third of the funds it surveyed had an investment in foreign-listed shares of Chinese companies at the end of June, the highest percentage it has ever measured. Alibaba, a top holding of many hedge funds, has slumped nearly 30 percent since the end of June.

Hedge funds also doubled-down on pandemic plays, loading up on investments in companies that benefited from pandemic lockdowns but underperformed recently as the economy reopened. For instance, hedge funds collectively own more shares in Amazon than they did a year ago, according to Bank of America. Peloton also recently became one of the stocks most widely held by hedge funds.

With coronavirus cases on the rise, however, betting on another pandemic-related slowdown or on a return to more strict social distancing looks smarter by the day. And Chinese shares have fallen so far that bargain hunters are jumping in, lifting stocks from historic lows in recent trading. What’s more, the biggest hedge funds don’t appear to have any trouble raising money as investors keep the faith that their strategies will pay off whatever the prevailing market conditions.

U.S. stocks rose in early trading Tuesday, heading for a fourth day of gains. The S&P ticked up 0.2 percent, crossing into record territory, while the Nasdaq composite was up 0.4 percent.

European stocks fell on Tuesday, with the Stoxx Europe 600 down 0.3 percent.

Oil prices rose. West Texas Intermediate, the U.S. crude benchmark, gained 2.2 percent to $67.11 a barrel.

Travel and leisure stocks rose a day after the Food and Drug Administration granted full approval of the Pfizer-BioNTech coronavirus vaccine for people 16 and older. American Airlines, Delta Air Lines and United Airlines all rose about 4 percent in early trading. Marriott International and Hyatt Hotels rose was up more than 2 percent.

Best Buy shares rose more than 6 percent after the electronics retailer reported that sales rose nearly 20 percent in the three months ending in July, as more customers upgraded their tech equipment.

The Carnival Vista docked in Galveston, Texas, in May. On a recent sailing, a passenger and crew members tested positive for the coronavirus; the passenger later died. 
Credit…Sipa, via Associated Press

Over two weeks in late July and early August, 27 coronavirus infections were identified aboard the Carnival Vista cruise ship sailing out of Galveston, Texas. One of those infected, a passenger, later died.

It was the highest number of cases aboard a ship reported since June, when cruises restarted in the Caribbean and United States, and the first death.

Last week, the Centers for Disease Control and Prevention issued a new advisory, warning people with increased risk for severe illness from Covid-19 to avoid travel on cruise ships, irrespective of their vaccination status.

Carnival is not the only cruise line to have seen an uptick in cases. Earlier this month, Royal Caribbean had six guests test positive onboard its Adventure of the Seas ship.

The companies have responded to the recent increase in cases by introducing pre-departure testing requirements for all passengers. Carnival also added a mask mandate on Aug. 7 for all vaccinated and unvaccinated guests in indoor areas and banned smoking in the casino.

Michael Bayley, the chief executive officer of Royal Caribbean, said the cruise line was typically seeing one or two positive cases out of more than 1,000 guests a week per ship. Mr. Bayley said in a candid Facebook post addressing the current coronavirus situation, “Testing captures status at a point of time and if the guest is incubating infection, then the test will miss it.” The vaccinated guests who test positive typically are asymptomatic, he said in the post.

Some cruise passengers have canceled amid concerns of the Delta variant, but many sailings are fully booked through the rest of year because of pent-up demand. READ THE ARTICLE →

David Pantera, a new hire at Google, worries that the switch to virtual orientation next month might affect his career.
Credit…Jason Henry for The New York Times

Workers who want to stay at home forever have been especially vocal about their demands, but a silent majority of Americans do want to get back to the office, at least for a few days a week. But as the latest coronavirus surge has led employers to delay return-to-office plans, that larger group is growing increasingly glum, Kellen Browning reports for The New York Times.

In a national survey of more than 950 workers, conducted in mid-August by Morning Consult on behalf of The New York Times, 31 percent said they would prefer to work from home full time. By comparison, 45 percent said they wanted to be in a workplace or an office full time. The remaining 24 percent said they wanted to split time between work and home. (Morning Consult surveyed workers from a variety of industries, so white-collar office workers were represented alongside those working in other fields, like retail.)

Certainly, some people have thrived in their new remote work lives. They saved time and money, and sometimes increased productivity. The degree to which employees have embraced permanent remote or hybrid work models has been “stunning” to company executives, said Tsedal Neeley, a Harvard Business School professor who has studied remote work for decades.

But for others, Professor Neeley said, it has removed needed barriers between work and home life, increased a sense of isolation and led to burnout. “Some people just dislike the screen — their physicality and their proximity to others is a big part of what work looks like,” she said.

Among those craving the routines of office life: social butterflies, managers, new hires eager to meet colleagues, and people with noisy or crowded homes. READ THE ARTICLE →




Cargo Transit Times

From Indonesia

To Orlando, Fla.

TYPICALLY

59 DAYS

CURRENTLY

87 DAYS

Cargo

ready to

depart

Indonesia

Capacity limits

are creating

longer lead times.

Trans-

portation

mode

Extra anchorage time (ships waiting to berth) because of port congestion, among other delays.

Arrival in

Vancouver,

British

Columbia

Arrival in

Ferndale,

Wash.

Local terminal

congestion.

Railways are

delayed by

wildfires, but

trucking

capacity is

good.

Arrival in

Orlando

Warehouses are

full; it’s harder

to find facilities

with space.

Arrival in

Orlando

Cargo Transit Times

From Indonesia

To Orlando, Fla.

CURRENTLY

87 DAYS

TYPICALLY

59 DAYS

Cargo ready to

depart Indonesia

Capacity limits

are creating

longer lead times.

Transportation

mode

Extra anchorage time

(ships waiting to berth)

is happening because

of port congestion,

among other delays.

Arrival in

Vancouver,

Britsh Columbia

Arrival in

Ferndale, Wash.

Some delays are

stemming from

Vancouver, which is

experiencing slight

terminal congestion

for local deliveries.

Railway deliveries

have been delayed by

wildfires, but trucking

capacity is good.

Arrival in

Orlando

Warehouses are full;

it’s harder to find

facilities with space.

Arrival in

Orlando


“We’re sitting on $2 million in inventory for one $30 part,” said the general manager of Catrike, which makes three-wheeled recumbent bikes.

Container shipping rates from China and East Asia to the United States’ East Coast climbed above $20,000 earlier this month, compared with about $4,000 a year ago. The time it takes for parts from one of Catrike’s suppliers to arrive by sea in North America from a factory in Indonesia has jumped to three months, and sometimes it takes four.

“This is here for the rest of the year, and it’s only going to get worse because of the Christmas season,” said the chief executive of an ocean logistics firm. READ THE ARTICLE →