in July; Nissan will leave Barcelona in December 2021. Indonesia has also lost a Nissan
plant but will gain one from Hyundai, keen to expand in South-East Asia. New ventures
will offer solace elsewhere, too. Ineos, hitherto a petrochemicals company, will begin
making cars at a former Daimler factory in France.

TO WATCH: Electric spin-offs. Irked by the higher share prices of pure-EV brands such
as Tesla, GM may sell a stake in its EV business. Hyundai plans its own EV spin-off, Ioniq.
Although it will be a sub-brand, with no stake sale, Hyundai’s share price should benefit.

Defence and aerospace

The fortunes of commercial planemakers in 2021 will be determined by travellers’
willingness to fly, which will in turn depend on the course of the pandemic. Airlines’
travails have prompted billions of dollars of losses at Airbus and Boeing. The
planemaking duopoly has had to slash production and delay deliveries; more order
cancellations could follow. In 2021 Moody’s, a rating agency, expects the industry to
churn out 30-40% less large commercial aircraft than it did pre-coronavirus.

Planemakers’ best hope is that disease-conscious consumers prove willing to take short,
domestic flights, lifting demand for narrow-body jets. Boeing’s grounded 737 MAX
(possibly renamed the 737-8) would be among them, once regulators clear it to fly again.
However, Boeing will first deliver the 450 already built. Its profits will recover to $5.7bn
in 2021, Moody’s projects, well below the $13bn it made before the MAX fiasco. A
challenge to the MAX and Airbus’s 320 NEO could loom closer as China’s Commercial
Aircraft Corporation (COMAC) belatedly begins delivering its mid-size C919.

Defence will be the safer business. Many countries are set on military modernisation
and replacing outdated equipment. Geopolitical risks are rife, pandemic or no: Sino-
American tensions could even spread into the realm of space-based weapons. America’s
government, the biggest defence spender, is helping domestic weapons-makers. Still,
even defence spending may not escape cuts if pandemic-induced debt-worries multiply.