Huawei CFO released +3

08:34 27-Sep-21

One more accounting note is that Magnachip has officially extended the termination date of its merger agreement with Wise Road Capital to December 25th.

On the Westport side, a subscriber points out that Europe's leading clean transport NGO has come out against LNG-powered trucks.  This is just a recommendation mainly based on tank to tailpipe analysis.  However, it mirrors what I'd already been saying about WPRT - the window of opportunity has passed.  WeiChai represents a bit of a last chance, as the Chinese make take a different line of thinking regardless of what is done in Europe. 

Mostly though, this data point just illustrates how complex the issues are.  The report considers, but mostly dismisses biomethane labeling it not affordable or scalable.  I would agree that it's unlikely to be the whole solution in the foreseeable future, and that fossil gas represents no solution at all for trucks.  On the other hand, vehicles powered by RNG sourced from agriculture or waste typically wind up having the greatest positive impact (trading methane that would have been emitted anyway for less powerful carbon dioxide).  Dismissing that simply because of a projection that it could only account for at most a quarter of trucking energy consumption seems like typical lobbyist bad logic to me; it's already broadly acknowledged that no solution will be a panacea.  The most impactful ones, like Xebec, should definitely be part of the answer and with American natural gas back up to $5.40 already there's plenty of reason for it to be pursued now.

The two Michaels were released just hours after the Canadian extradition case was dropped, shattering any pretense that the actions were unrelated.  Hopefully lots of other Sino-American nonsense will soon fall away as well.  Everything else is shaping up as expected too.  The gas crunch is already hitting the U.K.  I continue to see potential for that to continue to spread at least through the rest of Europe.  On the other side of the Atlantic, policy and budget deliberations are dragging on, as expected.  I'm inclined to downplay Chinese crackdowns, but must concede the effects are less predictable.

On 9/24/21 7:03 PM, Esekla wrote:

Huawei's CFO has been released and is free to return to China.  The charges against her will be dropped on December 1st, 2022 if she does not dispute the fraud charges presented by prosecutors.  The case against Huawei will continue to be pursued, and may be helped by this deal.

I see this mostly as a face saving move by Washington.  Once back in China, it will be nearly impossible for American authorities to force compliance or inflict punishment, should the deal be broken.  However, my guess is that travel and other factors will be more important to the Chinese.  We'll see what happens over the coming weeks, and thus, I suppose there is some value here as a barometer of Chinese intentions.

Assuming no disavowal, the next most important step for Westport, would be China releasing the two Michaels.  I'll be quite surprised if that doesn't happen soon, followed at some point by the miraculous cessation of stonewalling from WeiChai.

For Magnachip, I continue to think everything hinges on Chinese approval of the sale Intel's memory business to SK Hynix, which also seems more likely now, but could certainly drag out longer.