Volkswagen AG announced plans to cut an additional 50,000 jobs and streamline its product lineup as part of a sweeping restructuring aimed at boosting efficiency and competitiveness. The company's supervisory board unanimously approved the 'Future Plan' at a meeting in Wolfsburg, giving CEO Oliver Blume a stronger mandate to push through the overhaul after months of internal resistance.
The latest job cuts bring Volkswagen's expected total workforce reduction to 100,000. The automaker also plans to reduce its model lineup by about 50% by 2035 and slim its holdings. The restructuring comes as Volkswagen faces high costs, weaker demand, and intensifying competition in the global auto market. Management and the supervisory board said the changes are necessary to improve long-term competitiveness.
Nvidia acquires Hugging Face
In a major move in the AI sector, Nvidia announced it has agreed to acquire open-source AI platform Hugging Face for $12.9 billion. The deal, which had been rumored last week, represents Nvidia's second-largest acquisition on record. Hugging Face provides tools and infrastructure for developers and institutions to build, share, and deploy AI models. Nvidia said the platform will remain open to the broader AI ecosystem after the transaction.
This acquisition expands Nvidia's presence beyond the hardware that powers AI workloads, adding a widely used AI development platform to its portfolio. Nvidia's largest acquisition remains its $20 billion purchase of assets from chipmaker Groq in December. Before that, its biggest deal was the nearly $7 billion acquisition of Israeli chipmaker Mellanox in 2019. Analysts have noted that the Hugging Face deal could provide significant upside for Nvidia stock, though some caution about valuation.
Gold climbs as Fed rate hike bets ease
Gold prices rose sharply on Thursday as traders scaled back expectations for a September interest rate hike. Federal Reserve Governor Christopher Waller indicated support for keeping rates unchanged if inflation pressures continue to moderate. Spot gold rose 2.08% to $4,477.36, after reaching its highest level since Aug. 28 earlier in the session. US gold futures settled 2.5% higher at $4,525.40.
Traders saw about a 54% chance of a rate hike at the Fed's Sept. 15-16 meeting, down from around 62% before Waller's comments. Lower Treasury yields also supported gold by reducing the opportunity cost of holding the non-yielding asset. A weaker US dollar provided additional support by making dollar-priced bullion more affordable for overseas buyers. Investors are now awaiting Friday's US nonfarm payrolls report, followed by August consumer and producer price inflation data next week.
Oil extends gains on Middle East risks
Oil prices rose for a fourth consecutive day on Thursday as US strikes on Iran and renewed Israeli threats against Tehran increased concerns about disruptions to Middle East supplies. Brent crude futures were up 15 cents, or 0.16%, at $95.78 a barrel by 1 p.m. ET, while US West Texas Intermediate crude futures rose 63 cents, or 0.69%, to $91.64. Both contracts had reached six-week highs earlier in the session.
The latest attacks marked the most substantial exchange of fire between the United States and Iran since July. The conflict, which began with US-Israeli strikes at the end of February, is now in its seventh month. Shipping through the Strait of Hormuz also weakened. Six commodity vessels transited the strait on Wednesday, down from 11 a day earlier and below the 10-day average of around 13. Iran has also added ships to a list of vessels it considers non-compliant and subject to potential fines, confiscation, or detention if they attempt to pass through the strait.
Higher oil prices and concerns over their inflation impact have contributed to increased expectations for a Federal Reserve rate hike this month. This dynamic is also reflected in broader market moves, where tech stocks have been buoyed by Nvidia's strong forecast. However, the combination of job cuts at major automakers and geopolitical tensions adds uncertainty to the economic outlook.
This article is for informational purposes only and does not constitute financial advice.
