The daily business briefing: August 17, 2021
Safety regulators launch investigation of Tesla's Autopilot, Colorado River shortage to force farms to cut water use, and more
Safety regulators investigate Tesla's Autopilot
The National Highway Traffic Safety Administration on Monday said it had launched an investigation into Tesla's Autopilot system. The investigation came after accidents involving at least 11 of the hundreds of thousands of Tesla electric cars using the system. The cars drove into parked firetrucks, police cars, and other emergency vehicles, the safety regulator said. The Autopilot system can steer, accelerate, and brake without driver input. The first fatal accident linked to the system occurred in 2016, when a Tesla Model S hit a tractor-trailer in Florida, killing the Tesla's driver. "Driver monitoring has been a big deficiency in Autopilot," said Raj Rajkumar, an engineering professor at Carnegie Mellon University. "I think this investigation should have been initiated some time ago, but it's better late than never."
Federal government declares 1st-ever Colorado River water shortage
Low water triggered the first federal declaration of a shortage in the Colorado River's largest reservoir, Lake Mead, on Monday. The lake, created by the Hoover dam, is projected to be 1,065.85 feet above sea level on Jan. 1, nearly 10 feet under a threshold requiring farmers and others in Arizona, Nevada, and Mexico to cut their water consumption in 2022. Drought, extreme heat, and other climate-change-driven factors already have reduced the water level to under 1,068 feet, or about 35 percent full, according to the U.S. Bureau of Reclamation, which is responsible for managing water rights for states and Mexico. "This drought is like a boa constrictor. It just keeps getting tighter every year," said Tom Davis, president of the Agribusiness and Water Council of Arizona.
Stock futures drop after latest Dow, S&P records
U.S. stock index futures fell early following the latest record highs for the Dow Jones Industrial Average and the S&P 500. Futures tied to the Dow, the S&P 500, and the tech-heavy Nasdaq were all down by just over 0.3 percent several hours before the opening bell. The Dow and the S&P bounced back from early intraday losses to close up by about 0.3 percent on Monday despite fresh concerns that a coronavirus surge fueled by the highly infectious Delta variant was threatening the global economic recovery. Some analysts shrugged off the fears. "We remain bullish on stocks (particularly cyclicals/value) thanks to a strong earnings season, signs of receding risk from the Delta variant, and normalization of bond-equity correlation," JPMorgan wrote in a note to clients Monday.
Hachette to acquire independent Workman Publishing
Hachette Book Group said Monday that it would buy Workman Publishing in a deal worth $240 million. Workman is one of the country's largest independent publishers. It is known for titles such as What to Expect When You're Expecting and the Brain Quest workbooks. Hachette said three-quarters of Workman's value comes from older titles that continue to sell. Backlists include books on subjects with long-term relevancy, such as pregnancy and gardening. Carolan Workman, the executive chair of Workman, and Dan Reynolds, its chief executive, said the company's success stems from publishing relatively few titles and investing in them heavily.
Aldi to hire 20,000 ahead of holiday season
Grocery chain Aldi announced Monday that it would hire more than 20,000 new employees to prepare for the busy holiday season. The U.S. arm of the German discount supermarket chain also said it had increased the average wages of its store and warehouse workers to $15 an hour and $19 an hour, respectively. The company was among the first retailers to announce hiring plans ahead of the crucial holiday season. Retailers and restaurants are struggling to attract workers, with many companies raising wages and offering signing bonuses to recruit workers. Some restaurants have had to cut operating hours or offer only drive-through service due to staff shortages.