Business Now | 13 December

Published Dec 13, 2024, 6:53 AM

The BYD Shark 6 has won News Corp's car of the year, the first ute and Chinese brand to do so. Plus, Peter Dutton announces Coalition's nuclear costings, DigiCo makes its ASX debut.     

This is Business Now with Edward Boyd.

Hi, I'm welcome to Business Now. Thanks for your company today. I'm Edward Boyd coming up on the program. The BYD Shark six has won News Corps Car of the Year. It's the first Yute to ever win the award and the first Chinese car. Motoring expert David Mcowan says it's a wake up call to a complacent car industry. Opposition leader Peter Dutton has announced his nuclear policy. We'll explain all the details and the cost in just a second. Plus data center Business Digitco joined the stock market today worth four billion dollars. That's the largest listing since twenty eighteen. We'll talk tech and the economic outlook with Sam Ruiz from t ro Price. Let's get straight into that top story. Opposition leader Peter Dutton finally released the costings of his nuclear power plan today, which will be a cornerstone policy for the coalition at the upcoming election. Mister Dutton claims his policy to build nuclear power stations, based on modeling by Frontier Economics, will cost tax payers three hundred and thirty one billion dollars by twenty fifty. According to the same modeling, Labour's renewables centric policy will cost five hundred and ninety five billion over the same period.

This is a plan which will underpin the economic success of our country for the next century. This will make electricity reliable, it'll make it more consistent, it'll make it cheaper for Australians, and it will help us decarbonize as a trading economy as we must. And the fact is that we can deliver a plan which is going to keep the lights on, and we have a plan and a vision for our country which will help grow businesses, not close them down.

The plan involves keeping Australia's aging coal fired power stations operational for longer than currently forecast and building Australia's first nuclear power station by twenty seven, which is in half the time the CSIRO believes is possible.

In relation to the work that's been done, the independent costings that we've got today, it shows that forty four percent cost differential, so forty four percent cheaper under the Coalition's energy plan than Labour's energy plan over the period of implementation and lower emissions from twenty fifty on under our plan as well.

It's important to point out.

Energy Minister Chris Bowen responded to the nuclear proposal, claiming there are three fatal errors with the modeling, mainly the assumption that Ossie's will use less electricity by twenty fifty, the cost of producing one megawatt hour of nuclear power will be thirty dollars as opposed to the hundreds of dollars the CSIRO believes, and finally the savings from requiring less transmission lines.

Now we're going to do obviously more analysis when we've had more time with these costings, but just over the last couple of hours we've found the three fatal errors which lead to a very big black hole. We'll be saying more about costings. I'll be saying more about other things like water use and other implications of their nuclear plan over coming days and weeks. But all this underlines one fundamental thing that Peter Dutton is a huge risk.

Mister Dudden's proposal helped the uranium sector on the stock market today you can see Bannerman Energy, Deep Yellow Boss Energy and Paddaladen all finished in the green. Vaughan Bowen, the former chairman of the telecommunications company Vocus, has been found not guilty of insider trading after a five week trial. The Australian newspaper reports that after a week of deliberations, the twelve person jury found unanimously that mister Bowen was not guilty, acquitting him of two counts of insider trading. Assik accused mister Bowen of selling shares in Vocus in twenty nineteen after learning that a takeover bid for the company was going to fall through. Mister Bowen sold about two hundred, sorry, about twenty five million dollars worth of Focus shares at that point in time. All right, let's take a look at this week's top stories. According to stream, the top story across print, radio, TV and online, with just under thirty two thousand mentions was the Adas Israel synagogue fire bombing. Next up was the un Gaza ceasefire demand, followed by the arrest of Luigi Mangioni for the alleged assassination of the United Healthcare CEO. The federal opposition nuclear costings that was just today that took fourth place, and rounding out the list was Peter Dutton's national flag row. And here's the top stories for the finance sector. You can see there were pieces on souperranuation, insurance, and banking. Let's see how the stock market finished up today. The local market open lower this morning. All sectors were in the red. Mining companies and utilities were the worst performers. ASX two hundred finished the day down zero point four percent. Here's the performance for the week. Again, every sector was sold off. Tech stocks shed about six percent. There was clearly profit taking by investors on the ASX it dropped one point five percent. The market's now fall into a four week low. Medicine maker Mesa Blast was the top performer today after one of its products cleared a regulatory hurdle in the United States. Data scrubbing company appened It's slowly recovering after a tough year. Financial advisor Insignia jumped sharply after receiving a two point seven billion dollar takeover bid from Bain Capital. The shared trading platform IRIS was up to along with the wagering company TAB Corp. Mining stocks got crunched today, led by the gold miners, the lithium miners, the iron ore miners. Retail supply met cash that was sold off as well, down about three point three percent. News Corps car of the Year is the BYD Shark six, It's Chinese hybrid and a ute. Other top cars this year included the Hyundai Santa Fe hybrid, the Hyundai Io five, and the People's Champion, the Ford Mustang. I caught up with News Corps head of Motoring David Cowen a little earlier.

There's a few different elements to this. One of them is definitely the price. This is a very affordable vehicle. It costs less than fifty eight thousand dollars plus on no costs about sixty one grand in your driveway.

That is a really sharp price, and.

What you get for the money is extraordinary. Yes, the interior is absolutely loaded with features. You've got heated and cooled seats and a big screen and SATNAV and all that sort of stuff. But more importantly, under the skin, this thing is totally revolutionary. Most utes have a four cylinder turbocharged diesel engine. This thing has electric motors front and rear, and a big EV battery in.

The middle of the car. But it's not a conventional EV.

It also has a turbo petrol engine that basically works as a bit of a generator, so you can fill the thing up with petrol and drive interstate, no problems, or you can treat it like an EV and drive around town. It's powerful, it's economical, It's a really good solution.

Yeah, because one of the big fears for a lot of Aussies around the electric utes is the range. But what that's not the case obviously with the BYD Shark.

No, not at all.

No, the range is like eight nine hundred kilometers if you fill it up with petrol and then when you need to stop again, you can just fill it up with gas and do not need to worry about charging it as an EV.

But if you do.

Have home charging set up for solar and that sort of thing, you can absolutely treat it like an EV and drive about eighty kilometers or so without using any.

Fuel at all.

So if you do the school run Monday to Friday every day without burning any fuel, great, and then on the weekend you can go away camping, drive wherever you need to go using.

A bit of petrol. What's it actually like to drive?

It is the most quiet and refined ute I've ever experienced, which is saying something. So I'm doing this for a long time and I've been pretty much every ute on sale. It creeps around like an ev like a hybrid, and it also, like some of those cars, has really good instant pickup. You've got three hundred and twenty one killer lots of power in this thing, or you can tell your grandpart's like foive hundred and fifty horse power.

It's heaps, it heaps.

It's really quite quick in austraight lines, faster than like a Ford Raptor or something like that, which means, yeah, it's silent, it's smooth, it's pretty punchy.

It's a good thing.

I've only seen one so far on the streets. What do you think sales are going to be like over the next twelve months.

They are very, very new, and I think sales are going to be quite strong. They're holding about four and a half thousand deposits for the car and they're only just starting to reach customers now. So I do think this thing is going to be a bit of a hit, also because there are some massive incentives in place for plug in hybrid vehicles for the next few months.

Two. Another car on the list, Hyundai Santa Fe Hybrid. What's to like about that?

So the Santa Fe Hybrid came second in our car of the year testing. It's a really impressive vehicle. Now, this thing doesn't reinvent the wheel in the same vein as the Shark, but it's just a really great family suv. It follows cars like the Ki Sorrento and the Toyota Kluger. It's a big seven seater, the difference here being that it has a super efficient hybrid engine. It's only a one point six liter engine in this thing, and it uses about as much fuel as something like a Masda THII or a Toyota Corolla, despite being a two ton seven set suv.

It's a really clever vehicle.

Price point of the Shark sixty one thousand, what about with the Santa Fe.

It's a little dearer. But there's different models that you can choose. If you want to go full on like Pseudo range Rover. You can spend eighty odd grand on one if you really want to go hard, or you can spend a bit less for one with cloth seats and whatnot.

What I mean, do you think the hybrid is going to become a real growth point for the Australian market. Obviously people do like electric vehicles, but they kind of want the safety of having the petrol engine as well.

Yeah, I think hybrids make a lot of sense for the majority of people.

People like to.

Think that they are going to drive across the outback and across another bor and tow the huge boat and do all of that sort of stuff, but realistically, most people only do a few thousand k's a year and their average journey is only twenty odd kilometers that sort of thing. Hybrids make a heap of sense for that, particularly if you do live in a capital city.

Anytime you're moving.

Under about fifty ks an hour, hybrids are absolutely in their sweet spot. So for most people they make a whole lot of sense.

And I guess one of the downsides is the hybrid system does require a battery, so you sometimes have less boot space in some cars.

Yeah, that's definitely the case. We saw that with the toy de Prato. It's why it didn't quite make it into the top three Car of the Year because they have put a mild hybrid system in the car and they've moved the spare tie under the tailgate, which basically means there's no boot space in the car.

It's pretty disappointing.

Ionic five is also on the list. What's so good about that.

It's the first EV. You can see the smile on my face.

It's the first EV that's really gone after petrol heads.

This thing is an absolute crack up to drive.

It's got nearly five hundred killer wats of power, does not two hundred in like three seconds, so it's you know, it's the sort of speed that rivals sports cars like the Porsche nine to eleven, but in a much more practical, family friendly body. The thing is so much fun to drive, but it is a bit expensive at about one hundred and twenty five thousand dollars drive away.

But you are competing with the likes of the poorche or maybe not Ferrari, but you're kind of at that speed level on the market.

It's pretty incredible.

Yeah.

Absolutely, this is one of the really interesting things about EV's. Sure, you know people who are worried about Rang James anxiety and all that sort of stuff, but they are democratizing performance.

Basically.

There's a couple of evs that came out in the last year or so, in the MG four x Power and the BYD Seal that both do naught one hundred and three point whatever seconds for less than eighty thousand dollars, which is really quite punchy stuff. Twenty years ago that would have been absolutely insane to think about, whereas now you know, there are some of these evs that bring incredible performance for an affordable price.

The five N steps it up.

This thing has proper breaks and suspension, and it's got really grippy seats, and they've really put a lot of effort into engineering the car to perform on track. So if you are an enthusiagast, that is the first EV you want to be looking at.

And for the Shark, I understand you can just plug that into a regular PowerPoint, but for the Ionic five N, you kind of would want to have a proper electric charger at home.

Oh absolutely yeah.

The cars like the Ionic five N has a battery that offers, you know, for fifty five hundred kilometers of range that if you plug it into a regular PowerPoint is going to take like three days to charge.

You're not going to do that.

Anyone that's investing into that kind of car will one hundred percent be buying a wall box at home for about two thousand dollars so that they can charge it much quicker.

And the people's champion.

What was it?

There's absolutely the Ford Mustang. So we had an online poll in a previous story basically saying these are an nine finalists, what would your pick be? And of more than twenty thousand people that responded to that, the Mustang was far and away the favorite, with nearly thirty percent of the vote.

People still do love a traditional V eight Musselka.

Yeah.

We obviously had the bathist one thousand recently and you don't really see the Ford all the holding anymore, but the Mustang's there.

Yeah, absolutely, it's great. Cap.

Oh, look, David McCowan, head of Motory at News Corp, thanks for coming on the show.

Thank you.

And just before we.

Go to the break, casino operator The Stars Gold Coast CEO has resigned this afternoon. Mark McKay was only appointed in September and he's now resigned effective immediately.

Well.

Coming up after the break, Digitco joined the ASX this afternoon as well, and we'll show you how it went and talk outlook for technology with trow Price. Welcome back. The Digico Infrastructure Real Estate Investment Trust began trading on the stock market today after raising two billion dollars from investors. The total value of the floats about four billion dollars, which makes it the biggest IPO since Viva Energy in twenty eighteen. Digitco owns a series of data centers in Australia and North America. The company began trading at a listing price of five dollars. Here is where it finished up was sold off. It's now four dollars and fifty five cents. For more on Digitco and the global outlook, I spoke to Sam Ruiz from t row Price.

Yeah, I mean, it's not surprising that people are talking about a data center company is like a blockbuster IPO. It is what's been driving frankly global markets, particularly even US markets, data centers.

Data.

You know, it's been around for a long time. But with the explosion now of this new AI, generative AI and the fact that we basically need to build more and more data centers to power the training models of this AI, this is going to be a theme we're just going to continue to see for a long time. I'd just say it's not even about data centers. It's going to sort of move him further into what that means for energy. How we power these how we plug them into grids. So this is a theme I think we're going to be living for with for a decade plus.

Yeah.

Well, today, actually on energy, we heard Peter Dutton, the opposition leader, announce his plan for nuclear and a big part of that is this powering technology.

Over the next twenty to thirty years.

Yeah, so that's something that we're also seeing. So we are headquartered actually in the US, and we've been seeing that already with household big megacap tech companies like Amazon, like Microsoft are actually one of the biggest concerns is we might not actually have enough energy security for ambitions in AI. So we've even seen basically them going to utility companies either trying to secure gas turbines or how do we turn on decommission clear plants. There's a few reasons for that, not just because it's stable and a lot of capacity in terms of that type of vantage supply, but there's a big thematic under that around how do we get green energy and nuclear is one of the ways to supply that. So I'm not a surprise to see that closer to home as well.

When you look at this calendar year of twenty twenty four, tech seems to have been the really big standout, right.

Yeah, Tech the big standout. It's what's driving global share markets. Frankly, a little fun fact for you. If we think about the US market, where the majority of those heavy concentrated tech returns have been, it's actually going to be only the second time of actually fourth time, where we're going to see two consecutive years in a row of the US delivering more than twenty percent return, and a very large majority of that is driven by tech.

Looking at the general economy globally, how do you see the way things are tracking.

Yeah, So globally, i'd say things look okay at the headline level, but it's going to be a lot more idiosyncratic about which specific regions or economies are going to be doing better next year. So I've mentioned in the US number of times now, and the reason for that is because a lot of the growth we're seeing is just even at the corporate and economic level in the US, and we're just expecting that next year is going to be another standout year in a relative sense for the US economy. So they have avoided that hard landing, so it's a soft landing or no landing scene already cutting rates, the cutting rates already, and we've also got super easy it feels like it'll be super easy fiscal policy coming. Obviously, we've had the Republicans sweep and if we've got an environment where unemployment's pretty steady, we've basically got the FED cutting and we've got a government coming in with what we believe to be highly stimulative. Policy is friendly policy, is very business friendly policy, that's very good for the US market, the US economy. It then becomes a much longer conversation about what that means for the rest of the world, because there's question marks about China. We have China's weakness exposing countries or regions like Europe that rely on basically.

China's demand as well.

And I think a really interesting being side effect of all this is while the US starts to sort of deviate on their own path, does that mean basically other economies start to actually think about how they rejig these supply chains for tariffs and potentially even China having to export excess capacity away from the US to other countries, And interestingly, that could maybe be bad for some of our own industries but be a disinflationary effect.

Even for countries like Australia.

Yeah, well you mentioned Australia gendp growth point eight percent over the twelve months of September thirty pretty week. Reserve Bank just held its final board meeting this week kept rates on hold.

What do you think where do you think our economy is going to go next year?

Growth wise?

Is it going to pick up a bit?

I think that's the big question mark right now. I think it's starting to tell, as you've mentioned, a little bit more on the side of maybe this higher rate is starting to bite, and that's why starting to see a little bit more dubvish commentary come out of the RBA.

So it feels like.

When everyone's getting optimistic about the likelihood of those rate cuts increasing, is unfortunately more of a negative sign around. Maybe we need to start to sort of reinvigorate the economic because things look a bit weaker. So I would just say things aren't super bright, but they're also not looking terrible, So it's sort of that middle zone and hopefully cutting rates into that just starts to spark things up a little.

And when you look at Australia's market this year, I mean it's been at record highs basically for the past month and a bit. Big driver has been the banking sector and tech as well.

Yeah, so it's a very well known story. The banks have done exceptionally well valuations, some of them around the highest of the bank's globally. So when we look at that for the Australian market, there is a very big concentrated bucket in resources and banks, And I just say, if you think about both of those segments, one being quite reliant on China, and there is even some new announcements out of China overnight which left people a bit underwhelmed about whether the stimulus would be meaningful. That leaves potentially resources a little bit vulnerable. And then with where banks are, potentially if we avoid any types of credit problems in the economy, banks can be okay. But with where the valuations are today, it's a really hard level or zone to generate good returns from from here. So without being around fifty percent of the index, I just think that's going to be a little bit of a drag on the.

Potential overall index.

But within that there's still going to be really great individual opportunities, and I think techs a little bit of one of those spaces where the individual innovation of these companies could be good for some select companies.

Sam Rue is from tiro Price. Thanks so much for your time, Thanks for having me ed.

About three thousand homes are scheduled to be auctioned this week, the last big week of auctions for the year. Sydney will hold about eight hundred and thirty, Melbourne about twelve hundred auctions, Bruceband about one hundred and sixty, Adelaide about two hundred. Wa Tasmania the NT will hold forty nine auctions between them and Canberra will hold sixty two. Take a look at the most viewed properties going to auction this weekend. In New South Wales, top property is number four four to five six Edgecliff Road, Edgecliff. This two bedroom apartments in classic Art Deco building, Asking price one point two million. In Victoria, top property is two Jacker Streets, Essendon. This large five bed, five bathroom home has four parking spots and a pool. Asking price is three point six to three point eight million. Queensland, top property is fifty three Somerville Street, Carena Heights. This three better has three bathrooms, parking, big living areas and.

A large backyard.

South Australia, the top property is fourteen Jean Street, Largs Bay. This four better has one bathroom three parking spots. It's close to the Port Adelaide beaches. The top property in Western Australia is one four to eight Fitzroyd Road, river Vale. This modern four bedroom townhouse was built in two thousand and five and the most viewed property on the ARIA Group website this week. Is a large home on the outskirts of Noosa in Queensland. The address is forty nine Meadow Court, Dunan. The newly built home sits on one hectare that's ten thousand square meters. It's right next to a golf course and set amongst other large acreage properties. The home's actually two properties. There's the main house which has six bedrooms, and then there's the barn, which is the guesthouse with three bedrooms. So all up there are nine bedrooms, three bathrooms and parking for four cars. There's a massive paved driveway, a large pool, huge outdoor entertaining areas and big lawns. The property also includes a lot of bushland. The price guide for this one is about four point seven million dollars. Well, that's all for business now for the year. Thanks for watching. We'll take a break. We'll see you in twenty twenty five. I'm Edward Boyd. Thanks so much for your company.

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