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Ford, Toyota halt some output as U.S., Canada warn on trucker protests

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Ford and Toyota on Wednesday both said they were halting some production as anti-coronavirus mandate protesters blocked U.S-Canada border crossings that have prompted warnings from Washington and Ottawa of economic damage.

Many pandemic-weary Western countries will soon mark two years of restrictions as copycat protests spread to Australia, New Zealand and France now the highly infectious Omicron variant begins to ease in some places.

Horn-blaring protests have being causing gridlock in the capital Ottawa since late January and from Monday night, truckers shut inbound Canada traffic at the Ambassador Bridge, a supply route for Detroit’s carmakers and agricultural products.

A number of carmakers have now been affected by the disruption near Detroit, the historic heart of the U.S. automotive sector, but there were other factors too such as severe weather and a shortage of semi-conductor chips.

Toyota, the top U.S. seller, said it is not expected to produce vehicles at its Ontario sites for the rest of the week, output has been halted at a Ford engine plant and Chrysler-maker Stellantis has also been disrupted.

Another border crossing, in Alberta province, has been closed in both directions since late on Tuesday.

More than two-thirds of the C$650 billion ($511 billion) in goods traded annually between Canada and the United States is transported by road.

Starting as a “Freedom Convoy” occupying downtown Ottawa opposing a vaccinate-or-quarantine mandate for cross-border truckers mirrored by the U.S. government, protesters have also aired grievances about a carbon tax and other legislation.

“I think it’s important for everyone in Canada and the United States to understand what the impact of this blockage is – potential impact – on workers, on the supply chain, and that is where we’re most focused,” White House spokesperson Jen Psaki said on Wednesday.

“We’re also looking to track potential disruptions to U.S. agricultural exports from Michigan into Canada.”

Washington is working with authorities across the border to reroute traffic to the Blue Water Bridge, which links Port Huron in Michigan with Sarnia in Ontario, amid worries protests could turn violent, she told reporters.

Bank of Canada Governor Tiff Macklem called for a swift resolution.

“If there were to be prolonged blockages at key entry points into Canada that could start to have a measurable impact on economic activity,” he said.

“We’ve already got a strained global supply chain. We don’t need this.”

PROTESTS SPREAD

The protests were disrupting jobs too and “must end before further damage occurs,” Canada’s Emergency Preparedness Minister, Bill Blair, told reporters.

Ford suspended engine output in Windsor while its Oakville factory near Toronto is operating with a reduced schedule, as it warned the Ambassador Bridge closure “could have widespread impact on all automakers in the U.S. and Canada.”

Chrysler-maker Stellantis has also faced a shortage of parts at its assembly plant in Windsor, Ontario, where it had to end shifts early on Tuesday, but was able to resume production on Wednesday.

Protesters say they are peaceful, but some Ottawa residents have said they were attacked and harassed. In Toronto, streets were being blocked.

“We continue to know that science and public health rules and guidance is the best way to this pandemic is the way we’re going to get to the other side,” said Prime Minister Justin Trudeau.

The issue has caused a sharp split between the ruling Liberals and the opposition Conservatives, many of whom have expressed open support for the protesters in Ottawa and accuse Trudeau of using the mandates issue for political purposes.

In the United States, prosecutors in Missouri and Texas will probe crowd funding service GoFundMe over the decision to take down a page for a campaign in support of the drivers after some Republicans vowed to investigate.

Downtown Ottawa residents criticized police for their initially permissive attitude toward the blockade, but authorities began trying to take back control Sunday night with the seizure of thousands of liters of fuel and the removal of an oil tanker truck.

Police have asked for reinforcements – both officers and people with legal expertise in insurance and licensing – suggesting intentions to pursue enforcement through commercial vehicle licenses.

But as the authorities attempt to quell demonstrations in one area, they pop up elsewhere.

“Even as we have made some headway in Ottawa, we’ve seen an illegal blockade emerge in Windsor,” said Public Safety Minister Marco Mendicino.

(Reporting by Carlos Osorio in Windsor, Blair Gable in Ottawa and Jarrett Renshaw in Washington; additional reporting by Anna Mehler Paperny, Steve Scherer and David Ljunggren in Ottawa, Ismail Shakil and Kanishka Singh in Bengaluru, Ben Klayman in Detroit and Doina Chiacu and David Shepardson in Washington; writing by Denny Thomas and Costas Pitas; Editing by Lisa Shumaker and Grant McCool)

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Telus prioritizing ‘most important customers,’ avoiding ‘unprofitable’ offers: CFO

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Telus Corp. says it is avoiding offering “unprofitable” discounts as fierce competition in the Canadian telecommunications sector shows no sign of slowing down.

The company said Friday it had fewer net new customers during its third quarter compared with the same time last year, as it copes with increasingly “aggressive marketing and promotional pricing” that is prompting more customers to switch providers.

Telus said it added 347,000 net new customers, down around 14.5 per cent compared with last year. The figure includes 130,000 mobile phone subscribers and 34,000 internet customers, down 30,000 and 3,000, respectively, year-over-year.

The company reported its mobile phone churn rate — a metric measuring subscribers who cancelled their services — was 1.09 per cent in the third quarter, up from 1.03 per cent in the third quarter of 2023. That included a postpaid mobile phone churn rate of 0.90 per cent in its latest quarter.

Telus said its focus is on customer retention through its “industry-leading service and network quality, along with successful promotions and bundled offerings.”

“The customers we have are the most important customers we can get,” said chief financial officer Doug French in an interview.

“We’ve, again, just continued to focus on what matters most to our customers, from a product and customer service perspective, while not loading unprofitable customers.”

Meanwhile, Telus reported its net income attributable to common shares more than doubled during its third quarter.

The telecommunications company said it earned $280 million, up 105.9 per cent from the same three-month period in 2023. Earnings per diluted share for the quarter ended Sept. 30 was 19 cents compared with nine cents a year earlier.

It reported adjusted net income was $413 million, up 10.7 per cent year-over-year from $373 million in the same quarter last year. Operating revenue and other income for the quarter was $5.1 billion, up 1.8 per cent from the previous year.

Mobile phone average revenue per user was $58.85 in the third quarter, a decrease of $2.09 or 3.4 per cent from a year ago. Telus said the drop was attributable to customers signing up for base rate plans with lower prices, along with a decline in overage and roaming revenues.

It said customers are increasingly adopting unlimited data and Canada-U.S. plans which provide higher and more stable ARPU on a monthly basis.

“In a tough operating environment and relative to peers, we view Q3 results that were in line to slightly better than forecast as the best of the bunch,” said RBC analyst Drew McReynolds in a note.

Scotiabank analyst Maher Yaghi added that “the telecom industry in Canada remains very challenging for all players, however, Telus has been able to face these pressures” and still deliver growth.

The Big 3 telecom providers — which also include Rogers Communications Inc. and BCE Inc. — have frequently stressed that the market has grown more competitive in recent years, especially after the closing of Quebecor Inc.’s purchase of Freedom Mobile in April 2023.

Hailed as a fourth national carrier, Quebecor has invested in enhancements to Freedom’s network while offering more affordable plans as part of a set of commitments it was mandated by Ottawa to agree to.

The cost of telephone services in September was down eight per cent compared with a year earlier, according to Statistics Canada’s most recent inflation report last month.

“I think competition has been and continues to be, I’d say, quite intense in Canada, and we’ve obviously had to just manage our business the way we see fit,” said French.

Asked how long that environment could last, he said that’s out of Telus’ hands.

“What I can control, though, is how we go to market and how we lead with our products,” he said.

“I think the conditions within the market will have to adjust accordingly over time. We’ve continued to focus on digitization, continued to bring our cost structure down to compete, irrespective of the price and the current market conditions.”

Still, Canada’s telecom regulator continues to warn providers about customers facing more charges on their cellphone and internet bills.

On Tuesday, CRTC vice-president of consumer, analytics and strategy Scott Hutton called on providers to ensure they clearly inform their customers of charges such as early cancellation fees.

That followed statements from the regulator in recent weeks cautioning against rising international roaming fees and “surprise” price increases being found on their bills.

Hutton said the CRTC plans to launch public consultations in the coming weeks that will focus “on ensuring that information is clear and consistent, making it easier to compare offers and switch services or providers.”

“The CRTC is concerned with recent trends, which suggest that Canadians may not be benefiting from the full protections of our codes,” he said.

“We will continue to monitor developments and will take further action if our codes are not being followed.”

French said any initiative to boost transparency is a step in the right direction.

“I can’t say we are perfect across the board, but what I can say is we are absolutely taking it under consideration and trying to be the best at communicating with our customers,” he said.

“I think everyone looking in the mirror would say there’s room for improvement.”

This report by The Canadian Press was first published Nov. 8, 2024.

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TC Energy cuts cost estimate for Southeast Gateway pipeline project in Mexico

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CALGARY – TC Energy Corp. has lowered the estimated cost of its Southeast Gateway pipeline project in Mexico.

It says it now expects the project to cost between US$3.9 billion and US$4.1 billion compared with its original estimate of US$4.5 billion.

The change came as the company reported a third-quarter profit attributable to common shareholders of C$1.46 billion or $1.40 per share compared with a loss of C$197 million or 19 cents per share in the same quarter last year.

Revenue for the quarter ended Sept. 30 totalled C$4.08 billion, up from C$3.94 billion in the third quarter of 2023.

TC Energy says its comparable earnings for its latest quarter amounted to C$1.03 per share compared with C$1.00 per share a year earlier.

The average analyst estimate had been for a profit of 95 cents per share, according to LSEG Data & Analytics.

This report by The Canadian Press was first published Nov. 7, 2024.

Companies in this story: (TSX:TRP)

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BCE reports Q3 loss on asset impairment charge, cuts revenue guidance

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BCE Inc. reported a loss in its latest quarter as it recorded $2.11 billion in asset impairment charges, mainly related to Bell Media’s TV and radio properties.

The company says its net loss attributable to common shareholders amounted to $1.24 billion or $1.36 per share for the quarter ended Sept. 30 compared with a profit of $640 million or 70 cents per share a year earlier.

On an adjusted basis, BCE says it earned 75 cents per share in its latest quarter compared with an adjusted profit of 81 cents per share in the same quarter last year.

“Bell’s results for the third quarter demonstrate that we are disciplined in our pursuit of profitable growth in an intensely competitive environment,” BCE chief executive Mirko Bibic said in a statement.

“Our focus this quarter, and throughout 2024, has been to attract higher-margin subscribers and reduce costs to help offset short-term revenue impacts from sustained competitive pricing pressures, slow economic growth and a media advertising market that is in transition.”

Operating revenue for the quarter totalled $5.97 billion, down from $6.08 billion in its third quarter of 2023.

BCE also said it now expects its revenue for 2024 to fall about 1.5 per cent compared with earlier guidance for an increase of zero to four per cent.

The company says the change comes as it faces lower-than-anticipated wireless product revenue and sustained pressure on wireless prices.

BCE added 33,111 net postpaid mobile phone subscribers, down 76.8 per cent from the same period last year, which was the company’s second-best performance on the metric since 2010.

It says the drop was driven by higher customer churn — a measure of subscribers who cancelled their service — amid greater competitive activity and promotional offer intensity. BCE’s monthly churn rate for the category was 1.28 per cent, up from 1.1 per cent during its previous third quarter.

The company also saw 11.6 per cent fewer gross subscriber activations “due to more targeted promotional offers and mobile device discounting compared to last year.”

Bell’s wireless mobile phone average revenue per user was $58.26, down 3.4 per cent from $60.28 in the third quarter of the prior year.

This report by The Canadian Press was first published Nov. 7, 2024.

Companies in this story: (TSX:BCE)

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