Great article Tristan! I would agree that Costco needs to innovate in this space and gain scale sooner than other competitors to stay relevant online. In the article you mentioned Costco’s strengthened partnership with Instacart, however, I wonder how Costco will compete with Amazon’s delivery / distribution network. In addition to Costco’s higher cost of delivery, they still need to maintain lower prices to stay true to their customer promise, further diminishing profit margins.
I was also surprised at how far Costco is lagging behind Walmart, with 10% vs. 63% growth. This is a topic I would like to dig into more, and I wonder if acquisitions occurred at Walmart, leading to the large jump.
This was a very interesting read on a player which I had not considered in the current political discourse. Kansas City Southern is currently in a difficult position if NAFTA were to be nullified. I think the company is doing the right thing by working with industry and political leaders across all three countries. However, in the event that a trade deal is not reached, I think KCS’ current business will be safe (particularly in the near-term), but future growth in inter-country trade will be at risk. The author also brings up a good point that KCS needs to continue to invest capital in the region, but with tight guardrails.
While I commend LATAM Airlines on steps they have already taken, I agree with the author that this is just the start. I think for there to be a major step changes, the airline should focus on alternative fuel sources. I would partner with the companies you are leasing the engines from to make sure you are on the list of companies trying to be innovative when it comes to jet engine solutions.
I also find it compelling that LATAM is partnering with ground operations in Colombia and Peru. I think this is an initiative which the company should replicate across the region.
I think this article is informative on a complex topic. One of the catch 22s of the topic is that Nike is in fact bring manufacturing back to the US because of isolationist views and changes in policy, signaling that the policies are being effective. However, another catch 22 is that the policies are designed to bring back manufacturing so more workers are employed and instead Nike (and other manufacturers) is increasingly utilizing automation as a way to reduce cost.
However, even with the TPP off the table, I do think Nike has valuable manufacturing assets in the right place for the growth of the company. The article mentions that China is growing at 18% per year, so in a world with high tariffs from China and Asia as a whole, Nike can fulfill the growing Chinese demand with onshore manufacturing, and continue to invest in US onshore and nearshore manufacturing, utilizing automation. The one flaw in this plan is if President Trump pushes China too far and US companies are penalized abroad.
Great paper and a very interesting topic. I am curious to see how 3D printing is rolled out at the individual airport services centers and the breakpoint of economic feasibility when deciding to house a printer on-site. Currently are suppliers providing parts to service centers and therefore needing to keep a minimum inventory of replacement parts? Will this help suppliers by reducing inventory demands?
Using EHM appears to be a game changer when it comes to predicting what will go wrong with an engine. I wonder what value this will bring to the airlines who are leasing the engines in terms of less downtime. Will Rolls-Royce be able to monetize this added benefit, or will it be quickly replicated by competitors as an industry standard?