Cape Breton U tripled its international recruitment. Students say they pay the price.

Sarah Smellie, The Canadian Press

Over the past five years, Navy Nguyen says she has watched thousands of international students arrive at Cape Breton University to find a town that was wholly unprepared for them.

From 2019 to 2020, the school more than tripled its efforts to recruit international students, before being forced to scale back as incoming students couldn't find anywhere to live or work, and services such as public transportation were swamped.

Nguyen said the situation set up international students to bear the brunt of these failures, and then to be blamed for them, all while they were paying more than double the fees a Canadian student pays.

"We were recruited into this situation that we did not cause," Nguyen, 24, said in an interview. 

"We all moved here because we want a better life, we want a better education, we want a better outcome," she added. "It's possible. I'm definitely a better version of myself, but it comes with so much cost."

Federal Immigration Minister Marc Miller announced last month that new visas for international students would be cut by more than one-third this year, a move presented in part as a way to alleviate pressure on housing. Students say that rather than capping international study admissions, governments should address the systemic problems the high number of admissions exposed.

Figures obtained through access to information legislation show that in 2018, Cape Breton University hired 53 agents to recruit international students. The next year, that number leapt to 142, and then in 2020 it hit 179. The school cut back to 102 recruitment agents in 2021, and then to 70 and 53 in the following years.

In 2018, the year Nguyen arrived from Vietnam, there were 1,982 full-time international students at the school, making up 48 per cent of the university's population, figures from the Association of Atlantic Universities show. Now, there are nearly 7,000 international students at the school, three-quarters of the university's population.

That's more than a fifth of the entire population of Sydney, N.S., the coastal community where the university is located.

The university doubled its revenue in that time, from $69.1 million in 2018 to $139.5 million last year, according to financial statements available online. International students pay around $20,000 each year in tuition and fees at the school.

Nguyen said the community quickly became strained as more students arrived. Jobs became scarce and students crowded into rentals, many of which were in need of repair. CBC News reported that Rajesh Gollapudi, a business analytics student at the school, died in a fire in 2022 in a house he shared with seven other people. Court documents show the landlords have been charged with several fire safety infractions, and they are scheduled to enter a plea in March in provincial court.

Public buses between Cape Breton towns became packed with students, who had to live farther away and plan their days around sporadic rural bus schedules and long commutes, Nguyen said. Some live in their cars because they can't find housing, or they live in Halifax and make the long drive to Cape Breton.

They face racism and xenophobia from some, she said, but others see the young, educated people breathing life into a region known for its aging population.

Seventy-six-year-old Murdoch Moore and his 69-year-old wife, Lynn, have grown close with several international students and their families. When the couple's home near Sydney was buried during a massive snowstorm this month, their international student friends shovelled out him and many of his neighbours, Moore said in a recent interview.

“I consider the international students that have come here for the last five-plus years to be a great asset and blessing to the area,” Moore said. "They're taking our jobs? If I hear that once more, I'll go ballistic." Rather, he said, they're building lives in the region and using their education to fill essential roles, particularly in health care.

Omon Iyoriobhe is doing a health-care internship in Halifax, and he's set to graduate from Cape Breton University in May. He said he was shocked to find rent cheaper in Halifax than in Cape Breton, where he paid $650 for a room in a house with seven other people.

The 28-year-old from Nigeria worries the federal government's two-year cap on study permits for international students is a blanket measure that doesn't recognize the nuances of Cape Breton, or the university's efforts to reduce overseas recruitment and build new student housing.

There is a "symbiotic" relationship between international students and their community, as they get Canadian educations while offering an economic boost to a struggling region, he said.

"These students definitely bring a lot to the system," Iyoriobhe said. "Trust me, that's why the government opened the borders in the first place."

For Nguyen, adequate government support for post-secondary education would ensure schools don't have to use international students as "cash cows." She has volunteered and worked with non-profits in the five and a half years she has been living in the region, and she hopes to continue that work after she graduates in May.

"I can see myself working ... to further develop the community," she said.

This report by The Canadian Press was first published Feb. 27, 2024.

 

Apple cancels work on electric car, shifts team to generative AI

Mark Gurman, Bloomberg News

(Bloomberg) -- Apple Inc. is canceling a decadelong effort to build an electric car, according to people with knowledge of the matter, abandoning one of the most ambitious projects in the history of the company.

Apple made the disclosure internally Tuesday, surprising the nearly 2,000 employees working on the project, said the people, who asked not to be identified because the announcement wasn’t public. The decision was shared by Chief Operating Officer Jeff Williams and Kevin Lynch, a vice president in charge of the effort, according to the people. 

The two executives told staffers that the project will begin winding down and that many employees on the car team — known as the Special Projects Group, or SPG — will be shifted to the artificial intelligence division under executive John Giannandrea. Those employees will focus on generative AI projects, an increasingly key priority for the company.

Listen to the Big Take podcast on iHeart, Apple Podcasts, Spotify and the Bloomberg Terminal. Read the transcript.

The Apple car team also has several hundred hardware engineers and vehicle designers. It’s possible they will be able to apply for jobs on other Apple teams. There will be layoffs, but it’s unclear how many.

Apple, based in Cupertino, California, declined to comment.

The move came as a relief to investors, who sent Apple shares climbing Tuesday after Bloomberg reported the news. The stock was up about 1% at $182.63 by the close in New York.

Elon Musk, head of Tesla Inc., also celebrated the move. He shared a post on the X social media site with a saluting emoji and a cigarette.

The decision to ultimately wind down the project is a bombshell for the company, ending a multibillion-dollar effort called Project Titan that would have vaulted Apple into a whole new industry. The tech giant started working on a car around 2014, setting its sights on a fully autonomous electric vehicle with a limousine-like interior and voice-guided navigation. 

But the project struggled nearly from the start, with Apple changing the team’s leadership and strategy several times. Lynch and Williams took charge of the undertaking a few years ago — following the departure of Doug Field, now a senior executive at Ford Motor Co. 

Apple was still years away from producing a car and contemplated many different designs. Beyond the look of the vehicle, cracking self-driving technology was a major challenge. Apple had road-tested its system since 2017 using a Lexus SUV exterior, putting dozens of vehicles on roads in the US. The company also tested more secretive components on a gigantic track in Phoenix that was once owned by Chrysler.

In the end, Apple was facing a cooling market for EVs. Sales growth lost steam in recent months after high prices and a lack of charging infrastructure discouraged mainstream buyers from shifting to all-electric vehicles. General Motors Co. and Ford are pivoting to producing more hybrid vehicles after confronting lackluster EV demand and manufacturing bottlenecks, and automakers across the industry are slashing battery-electric car prices, production targets and profit forecasts.

Even Tesla, the pioneer of the EV revolution in the US, has warned its rate of expansion will be “notably lower” this year. Domestic EV sales growth will decelerate to 11% this year from an estimated 47% growth rate in 2023, according to a forecast by UBS AG.

Read More: Electric Vehicle Sales Growth Is Slowing. Here’s Why: QuickTake

Apple’s most senior executives finalized the decision in recent weeks, according to the people. It comes just a month after Bloomberg News reported that the project reached a make-or-break point. The most recent approach discussed internally was delaying a car release until 2028 and reducing self-driving specifications from Level 4 to Level 2+ technology. Apple had employees from across the car industry working on the project, including designers from Aston Martin, Lamborghini, BMW and Porsche.

Under the new arrangement, Lynch will report to Giannandrea. He previously reported to Williams, who also has overseen software engineering for the Apple Watch.

Apple once envisioned creating a car without a steering wheel and pedals, but it scrapped that notion earlier. The company also spent time working on a remote command center that could take over for a driver. 

Most recently, Apple had imagined the car being priced at around $100,000. But executives were concerned about the vehicle being able to provide the profit margins that Apple typically enjoys on its products. The company’s board was also concerned about continuing to spend hundreds of millions of dollars a year on a project that may never see the light of day.

Apple continues to invest heavily in other areas. The company spent $113 billion on total research and development over the past five years, with an average annual growth rate of about 16%. The company also recently launched the Vision Pro headset — its first new product category in almost a decade — and has built up that business.

The company has scrapped projects before, including a plan to make a TV set that was abandoned around 2015. But few endeavors have lasted this long, involved so many employees or wracked up billions of dollars in expenses. 

Read this next: Biden’s EV Dreams Are a Nightmare for Tesla and the US Car Industry

So far, Apple’s biggest push into the auto industry was its CarPlay software, which lets drivers access iPhone features like maps and Siri. It’s being redesigned to integrate more deeply with vehicle controls and entertainment systems. By not competing with automakers, Apple could give a boost to that software, helping spread it to more models.

Ultimately, focusing on AI may be a better bet, Bloomberg Intelligence analysts Anurag Rana and Andrew Girard said in a note. “Apple’s decision to abandon electric cars and shift resources toward generative AI is a good strategic move, we believe, given the long-term profitability potential of AI revenue streams versus cars.”

--With assistance from Gabrielle Coppola.

(A previous version of the story corrected the timing of an EV forecast.)

©2024 Bloomberg L.P.

 

Proposed Quebec language rules will lead to fewer products, higher prices: lawyer

The Canadian Press

A General Electric washer sits inside a retailer, Friday, Sept. 15, 2023, in Marietta, Ga. (AP Photo/Mike Stewart)

Appliance manufactures and a Montreal lawyer say proposed Quebec language regulations will lead to fewer choices and higher costs for products like home appliances.

The draft regulations released last month require manufacturers to translate into French all permanent markings on appliances that are necessary for the use of the products.

Under current law, permanent markings, such as those that are engraved on or welded to appliances, don't have to be in French unless they're related to safety.

The Association of Home Appliance Manufacturers says the vast majority of appliances on the market aren't compliant with the new rules.

Eliane Ellbogen, a Montreal-based intellectual property lawyer with law firm Fasken, says the rules would enter into effect 15 days after they are adopted, making them virtually impossible to comply with in time.

She says the proposed rules could lead to delays and higher costs as manufacturers replace their current offerings with compliant products, adding that some of her clients are planning to pull out of Quebec entirely.

A spokesman for French Language Minister Jean-François Roberge says the percentage of appliances with French-language markings has been steadily declining since the 1970s and that in other countries, manufacturers sell products with markings in the local language.

This report by The Canadian Press was first published Feb. 27, 2024.

 

Why do so many discount airlines fold? Lynx Air is latest in a line of failures

Christopher Reynolds, The Canadian Press

Lynx Air ceased to fly this week, the latest in a long line of discount carriers to bite the departures dust — brought down in part by stiff competition, high fees and Canada’s vast geography.

Lynx, which filed for creditor protection Thursday, marks at least the eighth budget airline to take off and then fizzle out since 2000, joining the ranks of Roots Air, CanJet and Swoop.

Most failed to clear the same barriers that have blocked the runway for decades.

Despite increased competition, Air Canada and WestJet continue to dominate the marketplace with more than three-quarters of seat capacity among national airlines. The veterans have deeper pockets than young upstarts, allowing them to more easily match ticket prices in a race to the bottom.

"There's a fundamental issue with how the dynamics of competition work in the Canadian marketplace," said John Gradek, who teaches aviation management at McGill University.

"The duopoly that we have in Canada is allowed to take on these discount carriers aggressively and use their competitive power to basically drive these carriers into bankruptcy."

Other industry observers have suggested the Canadian market has trouble supporting more than two large national carriers, though Porter Airlines aims to become an exception as it undergoes a rapid expansion from regional player to continental airline. The Toronto-based company aims to grow its fleet to 79 planes — nearly two-thirds of them jetliners — by 2025, up from 29 turboprops in 2022.

"If you look at history for the past 30 years, other than WestJet, there have not been that many successful ventures," noted Jacques Roy, a professor of transport management at HEC Montreal business school.

High fees and incumbent perks at large airports can work against newer airlines. Lynx, which launched its first flight in April 2022, pointed to rising costs and airport charges as among the culprits behind its demise.

Canada has high "airport improvement fees" relative to other countries, though that's partly because airports are non-profit entities that receive much less federal funding than those in the U.S., for example. Indeed, Ottawa took in more than $400 million in "ground rent" for airports' use of federal land in 2022-23, basing the annual tally on their revenues.

The fees, which are the same for both big and small airlines, raise the base price of a ticket, potentially deterring fliers with less disposable income — a key customer pool for discount carriers.

"They don't rely on their business model to steal traffic from WestJet or Air Canada," said Robert Kokonis, president of consulting firm AirTrav Inc. "They bring affordable travel to the folks that either never travel by air or who perhaps would like to travel more frequently if the price were were right.

"But when your starting point to stimulate the market is already so much higher because of the sum of all these taxes, fees and charges, it's very, very difficult to offer a price point that targets and fits the needs of that demographic," he said.

In Toronto, Pearson's airport improvement fee on a no-frills, one-way Flair Airlines flight booked this week between Toronto and Vancouver for March amounts to $35, or 25 per cent of the $139 ticket (most U.S. airports charge US$4.50). Taxes make up another $16 of that total, on top of a $7 security charge.

However, Canadian Airports Council president Monette Pasher said the improvement fees are comparable to large European airports such as Frankfurt in Germany and Heathrow in London that also operate under a user-pay regime. She called on the government to try "tweaking the model" by reinvesting the ground rent it collects in airport infrastructure.

The seasonal nature of air travel in Canada also results in a financial roller-coaster where new companies with less free cash flow struggle to hold on.

"The old saying is that if you want to become a millionaire, you start by becoming a billionaire — then you buy an airline," said Roy.

A lack of big, secondary airports in large cities can also force smaller airlines to bid for higher-priced slots at Pearson and Montreal's Trudeau airport. Executives have long complained about amounts charged for gate and apron use and landing fees as well as federal agency expenses such as security screening and air navigation.

However, airports' "aeronautical fees" are largely in line with global rates, said Pasher. And they have fallen by 10 per cent in real terms since 2007, rather than keeping pace with inflation.

"Canadian Airports Council research has found that even taken together, these fees (including airport improvement fees) represent just 12 per cent of the average Canadian airfare – less than most of the fees ultra-low-cost carriers and other airlines charge for the most basic provision of services, such as check-in, seat selection and baggage charges," Pasher said in an email.

That still leaves the age-old problem of a vast, sparsely populated geography that creates unique challenges for all carriers in Canada, but especially those struggling to get off the ground.

"The original model — Southwest or JetBlue in the U.S. — you basically offer point to point services between relatively large cities and markets and over relatively short distances," Roy said. The goal is to squeeze more revenue out of each plane with multiple trips per day and lower fuel costs, with customers able to endure the tight quarters due to the quicker trips.

"But in Canada, there's only a small number of such original destination pairs. And it's a market that is already occupied by major players like Air Canada and WestJet," Roy said.

“Even if you have deep pockets, how much are prepared to lose? How fast are you prepared to become a millionaire?”

This report by The Canadian Press was first published Feb. 27, 2024.

 

Lowe's sales suffer as home improvement slowdown persists

Jamie Nimmo and Olivia Rockeman, Bloomberg News

Lowe’s Cos. said its sales will fall further this year as consumers continue to hold off from sprucing up their homes amid higher mortgage rates and a drop in new construction projects.

Inflation and a stagnant housing market have made DIY customers “hesitant to spend on big-ticket purchases for their homes,” Chief Executive Officer Marvin Ellison told analysts on a Tuesday earnings call. “Those that did engage in home improvement activities took on smaller, non-discretionary projects with a heightened focus on value,” he said. 

The spending shift hit demand for items for the kitchen and bathroom, as well as for flooring and appliances. Lowe’s is focused on rolling out its new DIY loyalty program to boost traffic and revenue in store and online, Ellison said. 

Comparable sales for the current fiscal year will be down between 2 per cent and 3 per cent, a slightly larger dip than analysts were expecting, the retailer said Tuesday. Lowe’s saw like-for-like sales fall 6.2 per cent for the fourth quarter, though analysts were expecting an even worse performance. Shares rose less than 1 per cent at the market open on Tuesday in New York. 

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The most recent U.S. housing data has shown some improvement in sales of new and existing homes, but still-high borrowing costs mean that residential real estate activity is muted compared with a year ago. 

While home sales aren’t a direct indicator of Lowe’s sales, new purchases often fuel demand for home construction projects. Home owners who take on improvement projects make up about 75 per cent of Lowe’s sales. 

In November, Lowe’s cut its full-year forecast, citing fewer purchases of big-ticket items and a slowdown in spending by DIY customers. 

Total sales for the fourth quarter fell to US$18.6 billion, from $22.4 billion for the same period in the prior year. Earnings per share were $1.77, better than expected for the quarter.

Facebook, YouTube to face new rules under Canada online law

Randy Thanthong-Knight, Bloomberg News  Feb 26, 2024

Prime Minister Justin Trudeau’s government introduced an online safety law in Canada, joining European countries in trying to compel internet companies to actively regulate and remove harmful content. 

The Online Harms Act, introduced in parliament on Monday, will make platforms responsible for reducing exposure to damaging content, including material that bullies or sexually victimizes children, or incites extremism, violence or hatred. 

The law will cover companies that offer social media platforms, live-streamed video and user-uploaded adult content, as long as they meet a certain threshold of users, a figure that will be determined in later regulations. Firms such as Google’s YouTube and Meta Platforms Inc. are expected to be affected. 

It will also create a regulatory body called the Digital Safety Commission to enforce rules, receive complaints and order removal of content. An independent digital safety ombudsperson will also support and advocate for users.

Canada is late in introducing online safety legislation compared with jurisdictions, such as the United Kingdom, European Union and Australia. During the 2021 federal election campaign, Trudeau’s Liberal Party promised to introduce a law that would “put a stop to harmful online content and hold platforms accountable.”

The bill would also create a new standalone hate crime offense that would apply to every other offense in the Criminal Code, allowing the conduct to be treated as a crime in itself rather than an aggravating factor in sentencing. It would allow for penalties of up to life in prison.

It would also establish a process for people to file complaints about online speech to the Canadian Human Rights Commission, which could order the user to remove the content and compensate victims up to $20,000 (US$14,809). 

The bill adds to a list of contentious internet regulations introduced by Trudeau’s government in recent years. Critics have raised concerns about the balance between protecting internet users and safeguarding rights and freedoms. 

Conservative Leader Pierre Poilievre, Trudeau’s main rival, called the bill an “attack on freedom of expression” before seeing the legislation.

Last year, the government passed two key laws targeting online platforms. The Online Streaming Act aims to force platforms such as Netflix Inc. and Amazon.com Inc., to fund local media and feature Canadian content. The Online News Act requires Alphabet Inc. to pay for news content.

In response to the latter, Meta has suspended all links to news content on Facebook and Instagram in Canada to avoid making payments. The news block is battering news outlets that relied on Facebook to reach their communities, including small organizations that are sometimes the only providers of local news in rural areas.

Canada issues green bonds for first time since framework change

Chunzi Xu, Bloomberg News  Feb 26, 2024

(Bloomberg) -- Canada sold C$4 billion ($3 billion) of debt Tuesday, its first issue under an amended framework for green bonds that allows the country to raise funds to support nuclear power. 

The 10-year bonds have a 3.5% coupon and yield half a basis point less than Canadian government debt due in December 2033. 

The new framework makes Canada the first sovereign to venture into nuclear power finance through its green bond sales, the government said in a statement. European Union lawmakers have voted to give certain nuclear projects a sustainable label, a decision that left its parliament deeply divided amid concerns about waste disposal, the potential for weapons proliferation and the risk of accidental radiation.

This deal will likely be followed by similar issuances from public and private companies involved in nuclear power generation, Jonathan Hackett, head of sustainable finance at Bank of Montreal, one of the firms that underwrote the security, said in an interview. The completed transaction should help potential issuers’ confidence that there will be capital available when they need to refinance, he said. 

With the deal, “we have clear recognition that nuclear power is green,” Hackett said. 

 

--With assistance from Caleb Mutua.

©2024 Bloomberg L.P.

Air Transat will avoid strike after flight attendants approve collective agreement

The risk of a strike at Air Transat has lifted as flight attendants have voted in favour of a new collective agreement.

The 2,100 flight attendants voted 62.7 per cent in favour of the terms recommended by federal mediators.

The Canadian Union of Public Employees says the collective agreement, which is retroactive to Nov. 1, 2022, makes Air Transat flight attendants the highest paid in the industry.

The terms include total compound salary increases of 30 per cent over five years, the elimination of the two lowest salary tiers and other benefits like more vacation days.

Air Transat's chief people officer Julie Lamontagne says in a statement that following an "unprecedented process," the company is pleased to offer competitive working conditions.

Workers had been without a contract for more than 15 months and had twice rejected tentative agreements this year.

This report by The Canadian Press was first published Feb. 26, 2024

 

Video: New Carrier USS Kennedy Launches Cars Into the Water

Courtesy HII

PUBLISHED FEB 26, 2024 3:15 PM BY THE MARITIME EXECUTIVE

 

Huntington Ingalls' Newport News Shipbuilding has begun testing the catapults aboard the carrier USS John F. Kennedy, the second Ford-class ship. 

The carrier is built around a set of electromagnetically-powered launch catapults, which are fundamentally different from the steam-powered systems found aboard all previous CATOBAR carrier designs. The commissioning and testing of these brand new devices caused protracted delays for the first-in-class USS Gerald R. Ford, but they are now fulfilling their mission as designed, according to the Ford's crew. 

Kennedy's installation benefits from Ford's earlier shakedown experience, and the topside testing for the catapults is now under way. Newport News' staff have completed no-load tests on the bow catapults, and the team is now in the process of "dead-load" testing - that is, throwing wheeled weights off the deck and into the James River. 

Each test car weighs up to 80,000 pounds to simulate the loaded aircraft that Kennedy will one day send skyward. The cars can reach up to 150 miles an hour before flying off the bow and into the water. (At least one skipped off the surface before splashing down again.)  

After each set of shots, the test weights are pulled back out of the river so that they can be relaunched. As the cars are a symbol of the carrier's near-completion, thousands of yard workers and their family members signed the weights with messages of congratulations, HII said. 

"Reaching the dead load testing phase is a visual demonstration of how far we’ve come,” said Lucas Hicks, vice president for the Kennedy program. 

 

Morocco-to-UK Cable Project Plans to Order its Own Cable-Layer

Illustration courtesy XLCC

PUBLISHED FEB 27, 2024 3:53 PM BY THE MARITIME EXECUTIVE

 

A British renewable-power company is on track to order a superlarge cable-lay vessel for installation of one of the world's longest subsea power cable projects.

The Xlinks Morocco-UK Power Project will be among longest power transmission links in the world, thanks to a circuitous route that hugs the coastlines of Portugal, Spain and France. The project requires four parallel HVDC cables to carry about 3.6 GW of power capacity in two 1.8 GW links. With a route length of 2,500 miles, the total length of wire comes to about 10,000 miles.  

The power will come from an 11.5 GW solar/wind project in Morocco, buffered by a 22 GWh battery storage bank. The concept is to provide dispatchable power for up to eight percent of the UK's electricity demand, filling in gaps in Britain's local wind and solar generation. The big selling point is that as expensive as it will be - $25 billion all-in - it will still be far cheaper than a new nuclear power plant of equivalent capacity. 

A sister company, XLCC, is building a cable manufacturing plant in Scotland to creat the massive quantities of HVDC cable required for the project. The same firm is planning to order a cable-layer with the capacity to install it, and the award to build it is expected later this year. It will be one of the largest vessels of its kind, and will be able to deploy two cables at a time as a bundled pair. In addition to deploying it for XLinks, XLCC plans to charter the vessel out to other developers on the global market.  

Thanks to these supply chain investments, XLinks' backers are planning to complete the project by 2030-31. 

"The real big bottleneck is supply chains. It's manufacturing the cable, and it's manufacturing converter stations. If it wasn't for those two things, we would be much, much earlier," XLinks founder and former CEO Simon Morrish told Recharge. (The company has recently appointed a former Shell executive, James Humfrey, to run the project as CEO.)

XLinks has the backing of Abu Dhabi's National Energy Company, French oil major TotalEnergies and UK-based utility Octopus Energy.