Your Weekly Commercial Awareness Update – w/c 4th February

Your round-up of the stories that you should discuss at interview this week:

European Commission Blocks Siemens-Alstom Rail Merger

Reported by Radhika Morally

The long-awaited merger of two train manufacturing businesses, Alstom and Siemens, has been blocked by European Competition Regulators, which puts a abrupt stop on plans to create a Franco-German rail giant.

The intention when the deal was initially suggested was to create a single large European train company which could invest more in research and development whilst lowering costs.

However, regulators remain unconvinced that such a move is necessary to compete with state-backed rivals from China, expressing concerns that such a deal could lead to price increases and a restriction of choice for consumers; ultimately detrimental for European customers.

According to Margrethe Vestager, EU Competition Commissioner, the companies were not sufficiently willing to address what she describes as “serious competition concerns” which would have resulted from the creation of a near monopoly in the market. The universality of this opinion is reflected by the fact that national regulators in the UK, Spain, Netherlands and Belgium have publicly welcomed the veto.

Both Siemens and Alstrom have expressed their dismay at the decision, with Alstrom going as far as to describe it as a ‘clear setback’ for the European industry.

The case itself has been described as one of the most important test cases for the Commission, serving to highlight the heightened severity of EU competition rules. It is also of significance that this is a time of political transition in Europe; a change of leadership in Brussels this year could arguably present an opportunity for a reform of European policy.

For more information, see The Financial Times, Finimize, CNN, France24 and The New York Times.

Presidency Battle in Venezuela

Reported by Rui Ci Lee

The international community is split on who they are supporting in the presidency battle in Venezuela. On 23 January 2019, incumbent Venezuelan President Nicolas Maduro faced a challenge from the Venezuelan opposition leader and head of National Assembly, Juan Guaido, who declared himself to be the country’s acting president.

Maduro began serving as President in 2013 and was re-elected for a second term in the May 2018 election. There have been claims that he obtained his victory through rigged votes. Therefore, the position is technically vacant and according to Venezuela’s constitution, the acting president should the head of the National Assembly, ie Guaido.

Polling firm Datanalisis found that 80% of Venezuelans want him out due to his poor management of the country’s ailing economy. When oil prices plummeted in 2014, the Venezuelan economy, which is heavily dependent on oil exports, slumped. Oil production has now tumbled to 1.1m barrels a day. Food in the country is scarce, forcing Venezuelans to flee the country and poverty.

Apart from retaining military support, Maduro is backed by Russia, China, Mexico, and Turkey. China has loaned a total of $60bn to the country over the past 20 years, whereas Russia has invested GBP13bn through oil and arms deals with the country.

On the other hand, Guaido has drawn support from Venezuela’s main trading partner – US, the European Parliament, more than a dozen Latin American countries, and Canada. On 28 January 2019, the US froze the American accounts and assets of PDVSA, the country’s oil monopoly, and ordered payments of Venezuelan oil to be redirected to bank accounts reserved for Guaido. This is aimed at cutting off the country’s financial supply and topple Maduro’s regime, forcing him to surrender his presidency.

The Opposition has also taken other measures to bring Guaido to power. Guaido has persuaded the military to withdraw their support for Maduro. In exchange, soldiers and civilians who work to reinstitute democracy within the country are promised amnesty by the opposition-led National Assembly through a newly-passed legislation. Maduro has also been promised a chance to flee the country.

Read more at The Guardian and Economist.

Major Incident” Declared as Ocado Warehouse is Set On Fire

Reported by Megan Kearns 

A fire, which broke out Tuesday morning, has resulted in local homes being evacuated to keep the public safe. A 500 metre “exclusion zone” has been enforced to reduce the “risk of toxic release or large cylinder explosion” at the Hampshire based warehouse.

Approximately 200 firefighters have been deployed to tackle the blaze and Hampshire Fire and Rescue Service have tweeted there is a potential for homes up to 1.6 miles away to be evacuated, dependant on wind direction. Residents nearby have also been urged to keep their doors and windows shut to avoid damage from the fire’s smoke.

Neil Odin, Chief fire officer, highlighted the problems firefighters are having tackling the flames, “This building is not meant for humans to be interacting with the racking and the storage – it has robots moving racking on to loading bays, so for firefighters trying to get in that high and to make an effective fire-fighting strategy, it has been very difficult.”

It has been confirmed that no Ocado staff were harmed during the incident. The retailer has been warned that the fire may have a declining impact on sales until it can redelegate operations to other warehouses. The site in question accounts for 10% of Ocado’s capacity and approximately 30,000 orders are processed by robots at the warehouse each week. Ocado currently haven’t provided any details on how the fire will impact customers.

Find out more here.

A new way of hacking: threats to new cars technological functionalities

Reported by Emma Ducroix

Concern about the risks associated with virtual security data has increased since the introduction of new cars equipped with infotainment systems, self-driving features, Wi-Fi, cellular connections and more.

Security professionals are worried about cyberattacks with new cars more vulnerable than ever considering the fact that they evolve in term of technologies.

A data protection research group, the Ponemon Institute indicate in a report that an impact may be huge on consumer confidence, personal privacy and brand reputation because of software vulnerabilities.

Leaving companies and consumers vulnerable to security breaches, a study by cybersecurity firms SAE shown that auto engineers and security professionals aren’t keeping pace with the rapidly changing security threats.

The risk is that hackers may change the safety-critical systems of the car, which is a huge worry for the physical safety of the driver, as well as his personal information.

An experience has been made by hackers in order to show how easy it was to infiltrate the system and control steering, brakes and transmission of the car, without being near it. Systems are still vulnerable today, even if an update has been put in place, it is still not enough.

Considering the changes in society, which became a software-based environment, a lot of weaknesses appeared and they obviously help hackers to make the task easier.

Nonetheless, the main problem is that automakers don’t own enough resources to cope with threats; and further, they do not have the cybersecurity skills needed to protect themselves.

Then, we can notice that smart technology made vulnerable the security of all of us. But, by 2020 and 2030, connected cars and autonomous and self-driving cars will represent a huge part of the market.

In 2016, a car security launched. BlackBerry, the phone maker, introduces itself as automotive safety saying: “The biggest thing related to security is managing the life cycle of software and managing the life cycle of security; You constantly have to manage the security on a daily basis.”

“It’s an ongoing process of securing the life cycle of the car.”

Mitsubishi has developed its latest technology to protect connected cars against increasing threats.

Dahnert said the automotive industry should work on hiring more people who understand automotive-related security issues and train employees to watch out for potential issues.

FBI introduced tips for keeping a vehicle safe: We need to keep the software up to date, exercise caution when making modifications to vehicle’s software, use discretion when connecting third-party devices and so on.

Read more here.

Get these updates straight to your inbox every week by signing up here.