The Wall Street Journal - 03.04.2020

THE WALL STREET JOURNAL. ** Friday, April 3, 2020 |B5

which supply materials and

smaller components.

Justin Whitmire, president

of Southeastern Tool & Design

Inc., a machine-maker near

Volkswagen AG’s assembly

plant in Tennessee, said his

company is still open and mak-

ing equipment, but because the

VW plant is temporarily closed,

he isn’t able to finish some

work and receive payment.

He said he would have to

consider laying off some of his

28 employees if work doesn’t

resume this summer.

The biggest threat facing

the car companies now is the

risk that smaller parts-suppli-

ers go under, said Mark Fields,

Ford’s former chief executive

and a senior adviser at private-

equity firm TPG Capital.

“The industry should proba-

bly be having that discussion

with the government now to

explain, ‘If we’re shut down be-

yond this date, it will be a

problem for the supply base,

which means it will be a prob-

lem for us,’ ” he said.

The average car consists of

roughly 30,000 individual

parts sourced to hundreds of

suppliers.

A disruption at even one

firm could have a cascading ef-

fect, ultimately having an im-

pact on production at multiple

assembly factories, industry

analysts say.

Auto makers, including

Ford, Toyota and Nissan Motor

Co., say they are working with

parts suppliers to ensure they

can support them when their

North American factories re-

sume production.

A small number of suppliers

have been able to land con-

tracts to produce parts for

General Motors Co. and Ford

as they rush to establish pro-

duction of ventilators and

other medical equipment.

Fewer than 100 of GM’s thou-

sands of suppliers are involved

in the ventilator effort, and

some of those say the work has

replaced only a sliver of the

lost automotive business.

Some firms are working

with lenders to adjust financ-

ing terms and borrow against

future payments they expect to

receive from customers.

—Mike Colias

contributed to this article.

The average car consists of 30,000 parts sourced to suppliers.

KAMIL KRZACZYNSKI/REUTERS

world brands who toured this

incredible hotel once this pan-

demic is behind us,” he said.

The family had hoped to raise

as much as $500 million in a

sale, according to people famil-

iar with their thinking. But at

$350 million, the deal still would

have been the most-expensive

hotel sale in Washington on a

per room basis. People familiar

with the sale process say a deal

is unlikely until the impact of the

pandemic becomes clearer.

“As we have done from day

one, we are weighing all of our

options,” Eric Trump, who runs

the organization with his

ing a deal with two potential

buyers for between $320 mil-

lion and $350 million, accord-

ing to people briefed on the

matter, but those talks have

stalled. At least one of the po-

tential buyers was a consortium

and both were hotel investors.

JLL Hotels & Hospitality’s

Jeffrey Davis, a senior manag-

ing director at the firm market-

ing the Washington hotel, said

“preliminary offers” for the

property ranged between $300

million and $400 million. “Both

The Trump Organization and

JLL look forward to re-engaging

with all investors and the many

The coronavirus outbreak is

costing Trump Organization

properties more than a million

dollars in lost revenue daily and

may have hurt the firm’s

chances of earning a record

price on the sale of its Washing-

ton hotel, according to an anal-

ysis of industry data and people

familiar with the deal talks.

The majority of revenues for

President Trump’s family busi-

ness comes from travel and lei-

sure, which have been hit hard

by the forced closures and eco-

nomic downturn caused by the

pandemic. The situation could

worsen because golf accounts

for about half of the roughly

$440 million of income Mr.

Trump reported in his latest

government financial disclosure.

More than 500 staff at Trump

properties in New York, Wash-

ington, Las Vegas and Florida

have been laid off or furloughed,

say people familiar with the

By Brian Spegele ,

Craig Karmin

and Jenny Strasburg

brother Donald Trump Jr., said

in a statement. “Our main focus

right now is to keep our amaz-

ing teams healthy and safe.”

The Trumps’ failure to close a

deal could prove costly in other

ways. The property, a short walk

down Pennsylvania Avenue from

the White House, is a hub of so-

cial activity among Republicans.

If Mr. Trump isn’t re-elected this

fall, much of that business could

dry up quickly, and the Trump

name on the hotel could keep

other potential customers away.

Trump properties in Florida,

including Mar-a-Lago and the

Trump National Doral Miami, as

well as in Las Vegas are closed.

“It’s like a ghost town here,”

said Whitney Schneider, a Palm

Beach, Fla., resident and mem-

ber of Mar-a-Lago.

Mr. Trump’s businesses are

explicitly barred from taking

any part in the roughly $2 tril-

lion rescue package.

The Doral is likely losing

more than $200,000 each day

the resort is closed. Even the ho-

tels that remain open, such as in

Washington and New York, ap-

pear to be taking big losses, with

those two properties together

forgoing around $300,000 or

more in revenues each day.

—Justin Scheck

and Caitlin Ostroff

contributed to this article.

matter and federal disclosures.

Several Trump hotels have been

closed, and those still running

have experienced dwindling oc-

cupancies. One day in March, the

family’s flagship Trump Interna-

tional Hotel in Washington had

just 11 guests in its 263 rooms,

according to an employee.

Officials from the Trump Or-

ganization and longtime lender

Deutsche Bank AG have had in-

formal discussions in recent

weeks about easing or delaying

loan payments by the company

to the bank, according to a per-

son briefed on the matter. The

steps could be taken in the next

three to six months and the

talks included provisions in the

loan agreements relating to ex-

ceptional situations. The talks

were earlier reported by the

New York Times.

The discussions are ongoing

and have been part of a series

of talks the Trump Organization

sought with business partners,

the person briefed on the mat-

ter said.

The outbreak also has de-

railed the organization’s effort

to sell its long-term lease on

the Washington hotel, which is

in the former Old Post Office

building. With extensions, the

lease from the federal govern-

ment runs close to 100 years.

The organization was negotiat-

BUSINESS NEWS

Trump Sites Lose $1 Million a Day

Pandemic empties

family’s resorts, casts

doubt on lucrative sale

of Washington hotel

Minimum income reported

$435 million

Trumprevenuesourcesin2018

Source: WSJ analysis of federal financial disclosures

Note: The minimum income was used for sources where a revenue range was reported.

Golf

Real estate

Hotels

Other

Aircraft

Licensing

$3.4million

93.5

74.

7.

.

.5

General Electric Co. is fur-
loughing half of the U.S. man-
ufacturing workers in its jet-
engine business for four
weeks, citing growing pressure
on the global aviation industry
from the coronavirus pan-
demic.
The move, covering thou-
sands of workers, comes just
10 days after the division said
it would lay off about 10% of
its U.S. workforce, or about
2,500 employees, in one of the
first major job cuts by a large
American manufacturer. At
that time, GE also said the di-
vision would furlough up to
half of its maintenance and re-
pair employees for three
months.
“We appreciate the commit-
ment of all our employees dur-
ing this difficult time, and we
regret having to take this ac-
tion,” GE said Thursday. The
furloughed workers, who work
on commercial engines, will
continue to get company-paid
health benefits. The exact
number of people affected
wasn’t disclosed.
The aviation division is GE’s
largest and most profitable. It
makes and maintains engines
for planes built by Boeing Co.
and Airbus SE. In early March,
GE said it froze hiring, can-
celed merit-based raises,
trimmed nonessential spend-
ing and made cuts to its con-
tingent workforce.
Thus far, GE’s moves to
lower labor costs in the avia-
tion division have only been in
the U.S., but additional moves
could be coming in its over-
seas operations.
Last week, GE Chief Execu-
tive Larry Culp hinted at more
cuts to come, saying the avia-
tion division is working “with
the appropriate parties to
properly address its global
workforce.”
GE had about $36 billion in
cash at the end of 2019, along
with $35 billion in untapped
credit lines, according to its
annual report. Earlier this
week, GE closed the sale of its
biopharma division to Danaher
Corp. for proceeds of more
than $20 billion.
GE had been restructuring
its operations and trying to
pull out of a slump caused by
weak demand for its power-
generation equipment and
troubles in its GE Capital unit.
In recent years, GE had
slashed its quarterly dividend
to a token penny a share.

BYTHOMASGRYTA

Half of GE

Aviation

Wo r k e r s

Furloughed

Some manufacturing in Michi-

gan is deemed essential.

Figuring out how to navi-

gate the uncertainty is like

“trying to hit a curveball in the

dark,” Mr. Martin said. “If

we’re in this situation a month

or two from now, it will be

bedlam,” he added.

So far, 42 of the 44 auto-as-

sembly plants in the U.S. have

been idled because of the virus

outbreak, according to the Alli-

ance for Automotive Innova-

tion, a trade group.

Ford Motor Co. said Tues-

day that it would extend its

temporary plant closures in

North American indefinitely,

reversing an earlier plan to re-

start some by mid-April. Fiat

Chrysler Automobiles NV and

Toyota Motor Corp. also have

extended their work stoppages

into April.

Halting work at a major car

plant almost immediately sets

off a chain reaction, affecting

hundreds of auto-parts suppli-

ers and in turn their vendors,

Continued from page B1

Car Parts

Suppliers

Suffering

with billions of trade and quote

messages from multiple trading

venues to enforce the securities

laws and inform policy-making.”

She didn’t describe how the

data-analysis tool has fared re-

cently, though the agency’s

Trading and Markets division

has relied on Midas to monitor

the historic market halts and re-

openings of recent weeks.

Midas isn’t the only tool at

the SEC’s disposal. The SEC

spokeswoman said the agency

has also adopted measures to

help prevent future flash

crashes, such as marketwide cir-

cuit breakers, limits to prevent

stocks from trading outside

specified price bands and rules

requiring exchanges to

strengthen the technology infra-

structure of U.S. markets.

In 2012 the SEC hired a New

Jersey-based technology and

trading firm, Tradeworx Inc., to

deliver the Midas system. That

same year, the SEC also ordered

stock and options exchanges to

create the more-comprehensive

Consolidated Audit Trail. Trade-

worx, now known as Thesys

Technologies LLC, later won

that contract, too.

Eight years later, Thesys is

nowhere to be seen on either

contract. In January 2019, ex-

changes setting up the Consoli-

dated Audit Trail notified The-

sys they would fire the firm

after it fell behind schedule de-

livering the project. By April,

the firm had laid off 76 employ-

ees in its New York and South

Carolina offices, state layoff no-

tices show. In November, the

SEC transferred its Midas con-

tract from Thesys to another

data provider, New York-based

MayStreet LLC.

Thesys Chief Executive Mike

Beller said the company “re-

mains proud of the excellent

work that went into creating

and supporting the ground-

breaking Midas system.”

the Midas infrastructure,” re-
peating a similar problem that
had occurred two weeks earlier.
Then, on March 1, the system
suffered a hardware failure
which “led to corrupt data in
Midas,” the administrator
wrote.
Similar issues continued
through last year, emails show.
On Feb. 19, 2019, for instance,
the collection of direct feeds
from the New York Stock Ex-
change was delayed due to a
networking issue.
Midas was born out of the
infamous May 6, 2010, flash
crash in U.S. stocks. The SEC
also ordered the creation of an
even more-detailed database
that would help the agency
zoom in on individual trades
and trace them through Wall
Street’s plumbing. But that sys-
tem, known as the Consolidated
Audit Trail, has also faced chal-
lenges. Years later, it remains
unfinished after missing its No-
vember target for completion
and is now facing backlash in
Washington and on Wall Street.
The result is that “the SEC
still doesn’t have a comprehen-
sive view of the markets,” said
Tyler Gellasch, executive direc-
tor of the Healthy Markets As-
sociation, a group of institu-
tional investors and financial
firms that has advocated for the
completion of the Consolidated
Audit Trail.
A spokeswoman for the SEC
said Midas is a “unique tool”
that enables more than 300
agency staff to “interact daily

Continued from page B1

Regulator’s

Analysis

Tools Lag

Changefrompreviousyearinscheduledvehicleproductionin

NorthAmericaforthesecondquarter

Source: Wards Intelligence

–50% –40 –30 –20 –10 0 10 20

Mercedes

Mazda*

Nissan

Hyundai

Kia

Fiat Chrysler

BMW

Honda

Ford

Volkswagen

GM

Subaru

Volvo

Toyota

Tesla

EXTRACT OF THE AMENDMENT TO THE NOTICE OF CALL OF THE

SHAREHOLDERS’ MEETING

(pursuant to Article 125-bis, paragraph 1, of Legislative Decree 58/1998)

The Board of Directors of Intesa Sanpaolo, at its meeting on 31 March 2020, in compliance with

the recommendation of the European Central Bank dated 27 March 2020 on dividend policy in

the aftermath of the COVID-19 epidemic, decided to suspend the proposal regarding the dividend

distribution to shareholders and passed a resolution to propose the allocation to reserves of net

income for the financial year 2019 at the Ordinary Shareholders’ Meeting convened for 27 April 2020,

without prejudice to the proposed amount to be assigned to the Allowance for charitable, social and

cultural contributions.

Item 1 of the Ordinary part on the Agenda is therefore amended as follows.

1. 2019 financial statements:
   a) Approval of the Parent Company’s 2019 financial statements
   b) Allocation of net income for the year

All the remaining items of the Ordinary and Extraordinary parts as well as any further instruction and

information are confirmed and reference is made to the supplement to the notice of call available on the

website group.intesasanpaolo.com (“Governance”/“Shareholders’ Meeting”).

This amendment is published in the daily newspapers “Il Sole 24 Ore”, “La Stampa”, “Corriere della Sera”,

“Financial Times” and “The Wall Street Journal”.

for the Board of Directors

The Chairman - Gian Maria Gros-Pietro

Intesa Sanpaolo S.p.A. Registered Office: Piazza S. Carlo, 156 10121 Torino Italy Secondary Registered Office: Via

Monte di Pietà, 8 20121 Milano Italy Share Capital Euro 9,085,663,010.32 Torino Company Register and Fiscal Code

No. 00799960158 “Intesa Sanpaolo” VAT Group representative Vat Code No. 11991500015 (IT11991500015) Included

in the National Register of Banks No. 5361 ABI Code 3069.2 Member of the National Interbank Deposit Guarantee

Fund and of the National Guarantee Fund and Parent Company of the banking group “Intesa Sanpaolo” included in

the National Register of Banking Groups