How Honda Is Trying to Recover From an EV Bust

SPEAKER_1 (0:00)

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Alex Ossola (0:33)

After a big bet on electric vehicles went wrong, Honda is facing its toughest challenge in decades.

Sean McLain (0:39)

Things haven't been this bad for Honda, and basically forever.

Alex Ossola (0:42)

Plus, British investors are spooked after news of a looming contest between Prime Minister Keir Starmer and left-wing politician Andy Burnham.

Chelsey Dulaney (0:50)

He said last year, we need to get beyond this thing of being in hawk to the bond market, and that freaked out a lot of bond market investors.

Alex Ossola (0:57)

And the Wall Street Journal has learned that SpaceX is planning to go public in a month in what stands to be the biggest IPO ever. It's Friday, May 15th. I'm Alex Ossola for the Wall Street Journal. This is the PM edition of What's News, the top headlines and business stories that move the world today.

Disgraced Hollywood producer Harvey Weinstein's third New York trial has ended in a mistrial. An aspiring actress had alleged that Weinstein raped her in a Manhattan hotel room in 2013

Now a jury has deadlocked for the second time over whether Weinstein raped the woman after a 2020 conviction was overturned by a higher court. Prosecutors have 30 days to decide whether to retry the case. Weinstein is still expected to be sentenced in the coming months on a previous criminal sexual act conviction he faces up to 25 years, and he was also sentenced in California to 16 years in prison for sex crimes. He's appealing that conviction.

Across the pond, a political drama has been brewing and hitting the markets in the UK. Last night, the left-wing mayor of Greater Manchester, Andy Burnham, said he planned to stand for election to Parliament. That opened a path for him to take on current Prime Minister, Keir Starmer. It would be the first time a sitting Labour Party Prime Minister has been challenged while in office. Journal reporter Chelsey Dulaney joins me now from London. Chelsey, I want to talk about what these markets are doing. UK bonds have slid and UK government borrowing costs have climbed today to their highest level since the 2008 financial crisis. What is investors' concern here?

Chelsey Dulaney (2:35)

Investors are worried that Keir Starmer is going to lose his position as Prime Minister and whoever replaces him, that person is going to have to increase spending to sort of galvanize the public. So the worry is that this is going to lead to more borrowing for the UK, more spending, and the UK comes into this with extremely fragile government finances. So this political drama is really the last thing that the UK needs right now. And that's why we're seeing this have such a big impact on the UK markets.

Alex Ossola (3:05)

How much of investors' reaction has to do with their concern about having Burnham in particular in the PM seat or is it losing Starmer?

Chelsey Dulaney (3:14)

We've seen this big sell-off over the past day after it became clear that Andy Burnham was making a bid at the Prime Minister role. So it's clear that what we're seeing over the past 24 hours is related to Burnham. And Burnham, he said last year, we need to get beyond this thing of being in hawk to the bond market. And that freaked out a lot of bond market investors because the UK has a lot of debt and needs to borrow a lot of money.

And it wants its politicians to really be keeping the government finances in line. And so I think a lot of investors are worried that he is not going to be as disciplined about government spending as Starmer and his cabinet have been.

Alex Ossola (3:57)

By our count, the UK has had five prime ministers in seven years. What has been driving this instability?

Chelsey Dulaney (4:03)

The instability is not totally unique to the UK across Europe and across the world. We've seen political systems become much more polarized and the UK has a lot of constraints on it just because the economy has been basically stagnating for a long time. Debt levels are high and they have a very large welfare state that is getting very expensive to continue funding. So these politicians have little room to make big changes and people feel very unhappy about that.