Chinese oil majors have long feasted on the country’s oil reserves, which Beijing essentially gives them for free, but CNOOC (HKEx: 883; NYSE: CEO) is quickly learning that nothing in life is really free as it and its partner grapple with a stubborn oil spill in the country’s Bohai Bay. In the latest setback for that project, being developed by ConocoPhillips (NYSE: COP) but 51 percent owned by CNOOC, China’s ocean watchdog has ordered the shutdown of two platforms at the field and an environmental official is calling the leak a “disaster” (English article). While ConocoPhillips is primarily responsible for dealing with this headache on the ground, which it appears to be doing responsibly with regular updates and efforts to plug the leaks, the problem will also deal a blow to CNOOC, as majority owner of a project which it has undoubtedly included in its future production plans. In a way, perhaps this development is fortuitous since ConocoPhillips is more skilled in crisis management than CNOOC or either of its peers, PetroChina (NYSE: PTR; HKEx: 857; Shanghai: 601857) and Sinopec (HKEx: 386; NYSE: SNP). But the crisis also should give investors cause for concern, as it’s inevitable that one or all three Chinese companies will inevitably have to deal with a similar crisis on its own in the next few years, and I suspect that none of the trio is well equipped to handle such an event when it happens, neither from a technical or public relations perspective. As these oil majors expand their operations abroad, a similar accident in less-friendly foreign waters could ultimately prove a disaster for any of the three, both in terms of clean-up costs and from a negative PR perspective. Let’s just hope that none has to deal with a BP (London: BP) Gulf of Mexico-type crisis anytime soon.

Bottom line: CNOOC’s ongoing oil spill in the Bohai Bay spotlights challenges that China’s oil majors will face with future such accidents, which they are ill equipped to handle.

中国石油巨头一直受益於中国的石油储备，因为这些储备属於由中国政府免费提供的。但中海油<0883.HK><CEO.N>及其合作夥伴在渤海漏油事件中发现，没有什麽是免费的。发生漏油的油田是由美国康菲石油公司<COP.N>进行开发，但51%的权益属於中海油，中国的海洋监管部门已经勒令关闭此处的两个钻井平台，一名环保官员称漏油事故是一场“灾难”。虽然要负主要责任的是康菲石油公司，但此事也无疑是对中海油的一个重创，中海油肯定将这个项目中纳入未来的发展计划。某种程度上来说，这种事态也是个幸运，因为康菲石油公司在危机处理方面肯定比中海油或者中石油<0857.HK> <PTR.N>以及中石化<0386.HK> <SNP.N>成熟。但这场危机也肯定会让投资者感到忧虑，因为未来几年，这几家公司肯定要自己独立处理类似的危机，但我觉得这几家公司都没有处理好类似危机的能力，无论是从技术上还是从公共关系上。随着这些石油公司在海外开拓市场，如果在一个不那麽友好的海域发生类似危机，那麽无论是从清理成本还是从公共关系的角度来说，这对於这些石油公司来说将必然是一场灾难。让我们祈祷这三家公司都不会遇到英国石油公司<BP.L>遇到的那种危机吧。

一句话：中海油的漏油事故暴露出，中国石油巨头企业未来若遇到此类事故时可能面临的挑战，而这些公司目前都没有能力妥善处理好这种危机。

Related postings 相关文章:

◙ Sinopec, PetroChina Fight Back With ‘Pity Me’ Earnings 中石化、中石油上演苦肉计

◙ PetroChina Seeks Global Integration 中石油试图融入全球市场

◙ Sinopec Scandal Points to Big Oil Crackdown 中石化：“天价酒”事件实为敲山震虎？

Online travel agent Ctrip’s (Nasdaq: CTRP) recent fondness for new initiatives seems to be going into overdrive, with the company’s latest move taking it into insurance. Chinese media are reporting Ctrip was recently approved by the insurance regulator to get into the insurance business (English article), and, while no details are given, I suspect it plans to offer travel insurance for buyers of its airline tickets, vacation packages and other trip-related services. Regular readers of this blog will know I’m a fan of Ctrip, which has a strong record of expanding into industries related to its core travel services business in a slow, carefully considered manner. This latest initiative, if it indeed is in the travel insurance business, would fit in with Ctrip’s previous growth strategy, and in that sense it looks like a good move. My major concern, however, is that this move seems to reflect a recent acceleration of new initiatives by Ctrip, in sharp contrast to a much slower approach in the past. The company’s list of other recent initiatives is quickly growing, including hotel brand management (previous post), group buying (previous post) and restaurants (previous post), among others. The danger in moving into so many new areas so quickly is that the company will lack the resources to adequately develop any particular one of these initiatives, giving them a bigger chance of failure and potentially diverting top management’s attention away from Ctrip’s core hotel reservation, air ticket and vacation package business. Hopefully we’ll see a slowdown in these new initiatives soon, as Ctrip focuses on building up its new slate of offerings into real contributors to its top and bottom lines.

Bottom line: Ctrip’s move into the insurance business looks good on the surface, but the company would be well advised to slow down its accelerating addition of new service offerings.

在线旅游服务公司携程<CTRP.O>最近频频推出新动作，如今又要进军保险业。据中国媒体报导，携程最近获得中国保监会批准，得以进军保险业，虽然报导中没有透露更多情况，但我估计携程将为在该网购买机票、旅游项目等服务的客户提供旅游保险。经常读这个博客的人知道，我喜欢携程，这家公司谨慎、缓慢地向一些与其核心业务相关的领域进军，而这一次，如果携程果然是要进入旅游保险业务，那麽这与其以前的增长策略是相符的。我主要担心的是，这似乎反映出携程近期在加快脚步推出新动作，而这与其之前的稳妥风格有点大相径庭。携程最近的动作越来越多，例如酒店品牌管理计划，并购计划，以及餐饮服务计划。进入这麽多新领域的危险在於，这家公司可能缺少足够的资源来推进这麽多计划，来推进其中任何一个计划，因此失败的机率也就可能更高，可能会让高层顾不上关注携程的核心业务，如酒店预订、机票、旅游项目等。希望携程能放慢一些脚步，着重发展那些能带来利润和收入的核心业务。

一句话：携程进入保险业的举动表面上看起来不错，但公司还应该放慢扩张的脚步。

Related postings 相关文章:

◙ Ctrip Tries Its Hand at Brand Management 携程尝试品牌管理

◙ Ctrip Makes Smart Trip Into Group Buying 携程也推团购：不仅只是赶时髦

◙ Ctrip Finds Growth Recipe in Restaurants 携程：进军在线订餐

It’s still breakfast time here in Shanghai, so I’ll start the day with an item on Yum Brands (NYSE: YUM), parent of the KFC and Pizza Hut chains, which continues to feast on a China market hungry for greasy Western fast food. The most interesting item for me on Yum’s earnings announcement is that its deal to buy leading Chinese hot pot chain Little Sheep (previous post) is still alive. The only reference to that deal in Yum’s earnings statement comes in a footnote literally at the very bottom, in which the company says it has placed $300 million in an escrow account specifically for the purpose of buying Little Sheep. That deal was initially announced nearly three months ago, and clearly the main thing still holding it up is approval from Chinese anti-monopoly regulators. While this deal has almost zero monopoly implications, some worry that China’s nationalistic regulator may be reluctant to see a promising home-grown national brand swallowed up by a foreign giant like Yum, and thus veto it. The appearance of this item at the bottom of Yum’s statement, in my view, is likely a quiet message to investors telling them the deal is still alive and the company is cautiously optimistic it will be approved. Such approval would be great news for Yum, which now gets about a third of its global revenue from China and saw its same-store sales in the market grow a healthy 18 percent in the second quarter. (English article) A successful purchase of Little Sheep would give Yum a huge new market segment for growth not only in China but also eventually much of Asia, as the company operates more traditional sit-down restaurants specializing in hot pots, a winter favorite in much of China and countries like Japan and Korea. It would also send an important signal to Western investors that China is prepared to let them buy up healthy Chinese companies with good growth potential.

Bottom line: Yum’s mention of a special fund for its Little Sheep acquisition looks like a low-key sign the company is cautiously optimistic it will complete the deal.

现在在上海依然是早餐时分，所以我想以肯德基和必胜客餐饮连锁店的母公司–百胜餐饮集团<YUM.N>的一则新闻作为一天的开始。百胜刚刚发布2011财年第二季度财报，让我对该财报最感兴趣的一点是，该公司依然有意推进对小肥羊的收购案。财报最底端的注脚部分简单提到了该收购案，百胜向针对收购小肥羊专门开设的托收帐户存入3亿美元。这一收购消息最初是在近三个月前宣布，但很明显，导致该收购案悬而未决的主要障碍是中国反垄断监管部门的审批。尽管该收购案产生的垄断效应近乎为零，但有人担心，中国的监管者或许不愿看到一个有前景的、土生土长的国有品牌被百胜这种外国食品业巨头所吞并，因此会否决该收购案的通过。看我看来，此事出现在财报的底端很可能是向投资者默默传达讯息，告诉他们该公司依然在推进该收购，公司对该案获批持谨慎乐观态度。如果获批，这对百胜肯定是大好事。百胜在全球近三分之一的收入来自中国，今年第二季度在中国的可比店销售增长18%。成功收购小肥羊将不仅给百胜带来中国市场中一个拥有增长潜力的新领域，还将最终扩展至亚洲市场，因为这家公司经营的是采用传统餐厅布置的火锅店，在中国大部分地区和日本、韩国等地区，这种形式深受欢迎。如果成功，也给西方投资者发送了一个重要的信号，那就是中国愿意让他们收购有发展潜力、经营良好的中国企业。

一句话：百胜提到为收购小肥羊开设了一个特别基金，相当於这家公司发出的一个低调的信号，那就是百胜对收购小肥羊感到谨慎乐观。

Related postings 相关文章:

◙ China’s Heavy Hand Leaves Investors Wary on YUM’s Little Sheep Buy 百胜难吞小肥羊

◙ YUM and Little Sheep – A Sweet Match If China Approves 美国百胜购小肥羊：甜蜜姻缘还靠中国政府成全

◙ Starbucks, Maxim’s Divorce: Bitter Ending or Sweet Times Ahead? 星巴克与美心闹“离婚”

Less than two weeks after the first signs emerged that something was happening at the top of leading Chinese chipmaker SMIC (HKEx: 981; NYSE: SMI), the big power shift appears to have begun. Shanghai’s well-connected financial newspaper, Diyi Caijing, is reporting that SMIC’s CEO David Wang tendered his resignation yesterday, and that the company’s chief marketing officer has also resigned. (Chinese article) I would expect an official announcement from the company in the next day or two, and expect stock reaction will be muted when trading in the company’s Hong Kong-listed shares resumes. The transition, which should see a team of mainland Chinese managers take over from the current Taiwanese team, will bring both good news and bad news for the company, hence the mixed reaction. On the good side, it will end a period of uncertainty and instability for the company as the new leadership team is confirmed. But for the longer term, this new team is likely to bring more instability to the company as it has less experience than the outgoing year-old team, which managed to move SMIC into the black after four straight years of losses. I don’t know enough about the new team to really say how well it will perform. But knowing what I do about how big Chinese companies love to mix business with politics, I really don’t see this as a positive development for SMIC. If the company really wanted to introduce a new team of mainland-born managers, it should have done so in a much more orderly, transparent way than the chaos that has unfolded in previous weeks. The fact that this transition was so chaotic and disorderly probably reflects a similar chaos and disorder within the company’s board and top ranks, which can hardly bode well for it in the next one to two years.

Bottom line: SMIC is likely to see a period of instability and chaos following the departure of its current top management team in a highly disorganized manner.

一个多星期以前，中芯国际(0981.HK: 行情)(SMI.N: 行情)高层动荡初露端倪，现在巨变似乎已经开始。上海《第一财经日报》报导称，中芯国际首席执行官（CEO）王宁国昨日递交辞呈，公司首席营销官（CMO）季克非也已请辞。我预计该公司将在未来一两天发表正式声明，而中芯国际在港上市的股票恢复交易後，股价应该不会有太大反应。中芯国际此次高层动荡，基本是清理现有台湾高管，让大陆人取而代之，这对于公司来说喜忧参半，市场反应也是有好有坏。好的一面是，公司确定新的领导团队，将结束动荡和不确定性。但长期来看，经验不足的大陆高管接管公司，可能将带来更多动荡，毕竟台湾团队在公司连续四年出现亏损後，已帮助公司扭亏为盈。我对新管理层了解不多，无法预测其表现如何。但我了解中国大型企业多喜欢将商业和政治混为一谈，所以我不认为此次变动对中芯国际发展有利。如果该公司的确希望将管理层换血为大陆人，本应该采用更有序、更透明的方式，而不应出现近几周的混乱局面。事实是，中芯国际这次权力交接如此混乱无序，很可能反映出该公司董事会和高层本身的混乱局面，这对未来一两年的中芯国际来说很难是好兆头。

一句话：中芯国际现有高层在一片混乱中离职，可能导致公司未来一段时期的动荡和乱局。

Related postings 相关文章:

◙ SMIC Top Management in Throes of Power Struggle 中芯国际管理层陷入权力之争

◙ SMIC Rumbles with Talk of Leadership Change 媒体风传中芯国际领导层变动

◙ SMIC: Forging a Better Future?

Just when you thought things couldn’t get any worse for sputtering auto maker BYD (HKEx: 1211; Shenzhen: 002594), the company has come out with a warning saying its profit fell by up to 95 percent in the first half of the year as sales tanked. (English article) That announcement means that BYD probably slipped into the red in the second quarter, since it reported a $42 million profit in the first quarter but only expects its first-half profit to come in at around $19 million. The slip into the loss column marks a culmination in the fall from grace for BYD, which shot to fame after billionaire investor Warren Buffett purchased 10 percent of the company but has seen its fortunes tumble over the last year. BYD’s shares shot up by many times after Buffett’s original investment, and have given much of those gains over the last two years as it struggled with fading popularity for its traditional cars even as it hyped an expensive electric car program which, at best, is still years from contributing to its top line. This latest warning comes just days after BYD scrapped an auto financing joint venture that had potential to help it boost its flagging sales, which have now fallen for 11 straight months. (English article) France’s Societe Generale pulled out of that joint venture after expressing doubts about the Chinese auto market, and I have no doubt it was particularly concerned by BYD’s own poor performance. BYD shares were down 3 percent in early Wednesday trade in Hong Kong, and are down much more than that this year. Unless the company can return quickly to the black by rolling out some popular new models, which seems unlikely, I see more tough times ahead for BYD. In the meantime, Buffett must surely be wondering about his investment in the company and considering a sale of his stake, which, if it happened, would deal another large blow to BYD.

Bottom line: BYD’s move into the red is the latest negative milestone for this once-promising company, with no signs of near-term improvement on the horizon.

正当你觉得比亚迪<002594.SZ> <1211.HK>的情况已经没法再糟糕了，公司宣布因销量大挫，今年上半年公司利润最高可能下跌95%。这就是说比亚迪第二季度已经亏损了，因公司一季度利润为4,200万美元，但上半年利润预计仅为1,900万美元左右。转盈为亏标志着比亚迪失宠的一个拐点。亿万富翁巴菲特购买比亚迪10%股份後，公司一炮打响，但过去一年中比亚迪市值不断缩水。巴菲特入股後，比亚迪股价翻了很多倍，但是过去两年中因公司在传统汽车领域逐渐失去消费者的追捧，而其大力宣传的电动车项目还需要几年才能为营收做出贡献，其股价涨幅已大幅回吐。而比亚迪建汽车金融合资公司计划刚刚告吹几天就出现这一盈利预警。法国兴业银行对中国汽车市场表达忧虑後，撤出了与比亚迪的这一合资项目，我毫不怀疑法兴银行应该是尤其担忧比亚迪本身的表现。比亚迪H股周三早盘跌3%，今年累计跌幅更高。除非公司推动一些受欢迎的新车型、迅速重新盈利，否则比亚迪未来还会继续坎坷。同时，巴菲特肯定在怀疑对比亚迪的投资，考虑是否出售持股。巴菲特如确实售股，比亚迪必再次大受打击。

一句话：比亚迪转入亏损是这家昔日明星企业一系列负面新闻的又一里程碑。公司短期无转好迹象。

Related postings 相关文章:

◙ China’s Car Rebound: Price War Looming? 中国车市反弹：价格战越来越近？

◙ BYD IPO: Selling Into a Skeptical Market 比亚迪IPO 市场疑虑重重

◙ Autos: Good Times Screech to a Halt 中国汽车业：当繁荣已成往事