E-mobility, copper boom, and chemical crisis: Rheinmetall, Prismo Metals, and BASF showcase industry trends

Rheinmetall drives innovation in mobility and energy

Since the Russian invasion of Ukraine on February 24, 2022, the share price of the German defense company Rheinmetall has risen by 438.95% as of this week (from EUR 95 then to EUR 512 today). Investors who bet on this stock early on can look forward to a fivefold increase in their invested capital. An initial investment of EUR 10,000 would have grown to over EUR 53,000.

In addition to its strong defense and military division, Rheinmetall is showcasing several innovative solutions for the automotive and energy sectors within its Power Systems division. One highlight is the innovative charging solution concept for electric vehicles: curbside charging stations that seamlessly blend into urban landscapes. The phrase "folding up the sidewalks," traditionally meaning deserted/emptiness, now takes on a whole new meaning with the hidden power of electricity. These have been tested at two locations in North Rhine-Westphalia since April 2024. They offer a space-saving alternative to conventional charging points and enable direct curbside charging.

An international car manufacturer has placed a major order with Rheinmetall for electric coolant pumps for hybrid vehicles. The Company has also secured orders for exhaust technologies in China, including fuel tank shut-off valves and low-pressure exhaust gas recirculation valves.

In the electric truck segment, Rheinmetall has secured a significant order for high-voltage coolant pumps. These pumps, designed for an 800V architecture, are characterized by their wear-free operation.

Another milestone is the order for 150,000 hydrogen recirculation blowers for the bus and truck sector. Rheinmetall's strategy of positioning itself as a leading provider of future technologies in the field of sustainable mobility appears to be paying off. The developments to date are at least encouraging for shareholders.

Copper as a key resource: How Prismo Metals could benefit from the energy transition

The debate between US presidential candidates Kamala Harris and Donald Trump leaves many questions unanswered. While the Democratic candidate makes many promises for the next legislative period, many viewers wonder why the Biden-Harris administration has not already implemented these promises in the last 3 years to strengthen the USA's economic power.

According to polls, a majority of Americans are dissatisfied with the current economic situation. This could be due to the effects of the inflationary phase, which many citizens are still feeling.

Trump repeatedly addressed the issue of China during the debate and announced a tightening of his previous trade policy. He held out the prospect of further increasing the tariffs on Chinese imports introduced during his presidency. China is known for its rich natural resources. All the more important in light of increasing geopolitical tensions is to secure domestic reserves and those in neighboring countries.

The up-and-coming exploration company Prismo Metals is focusing on growth in Mexico and the USA. Prismo Metals is currently actively advancing the exploration of three promising projects:

• The Hot Breccia Copper Project in Arizona, USA, covers 1,420 ha of contiguous mining claims in the world-renowned Arizona Copper Belt.

• The Palos Verdes Project, a 22.8 ha property, is located in the historic silver-gold district of Pánuco-Copala in southern Sinaloa, Mexico.

• The Los Pavitos project covers an area of 5,289 ha in southern Sonora, Mexico.

With this diversified portfolio of precious and base metal projects in strategically favorable locations, Prismo Metals is positioning itself as an interesting player in the exploration industry.

Copper plays a central role in various key sectors of the US industry. In the electrical industry, its excellent conductivity makes it indispensable for cables, wires, and circuit boards. In the energy sector, copper plays a key role in electrification and is particularly important for renewable energy systems and green technologies. The automotive industry also relies heavily on copper, with the average vehicle containing around 25 kg of the metal - this demand even rises to around 65 kg for electric vehicles. Copper is also used in a variety of applications in the construction industry, be it for piping, roofing, or other architectural elements.

The team at Prismo Metals is characterized by a successful mix of seasoned explorers and long-term experience in capital markets. Prismo Metals focuses on the right people, projects, and timing. The Company has its costs under control at all times by avoiding fixed salaries, further emphasizing the team's confidence in their performance. With a streamlined share structure of 54.1 million outstanding shares and a market capitalization of CAD 10.5 million (as of September 12, 2024), the Company demonstrates a solid financial base.

The high proportion of founders and experts (28.6%) is also noteworthy. In addition, Vizsla Silver is a strategic investor with a stake of 9.4%, which underlines the confidence in the Company's growth potential.

German chemical industry: Recovery falters, BASF plans plant closures in Ludwigshafen

The slight recovery in the German chemical industry faltered in the second quarter, as shown by a report by the industry association VCI, according to Reuters. Both domestic and foreign orders declined, particularly in the pharmaceutical sector. Total production in the chemical and pharmaceutical industry rose by only 0.8% compared to the previous quarter, significantly slower than in the first quarter. Pharmaceutical production even fell by 4%.

Leading European companies are increasingly expressing concerns about the impact of strict EU climate regulations on their global competitiveness. The European Round Table for Industry (ERT), an influential lobbying organization representing around 60 major companies, criticizes the current implementation of EU climate targets.

The organization, which also includes German heavyweights such as BASF, Mercedes-Benz, and SAP, warns that stringent regulations could "accelerate the loss of competitiveness". This criticism comes against the backdrop of the ambitious EU target of achieving climate neutrality by 2050 - a plan that has been enshrined in law since 2021. Industry is calling for a review of climate protection measures in order to maintain the balance between ecological goals and economic competitiveness.

BASF is continuing the structural adjustment at the Ludwigshafen site and is planning the closure of production facilities for adipic acid, cyclododecanone, and cyclopentanone by the end of 2025. This measure aims to secure the site's competitiveness under changed market conditions. Approximately 180 employees are affected, and BASF will support them in finding new employment opportunities within the Group. Adipic acid production will continue in South Korea and France. This decision is part of a long-term transformation plan for the Ludwigshafen site. The share is currently trading at EUR 43.06. The share price has fallen by around 12% since the beginning of the year.

Prismo Metals is positioning itself as a promising exploration company with a diversified portfolio of precious and base metal projects in strategically favorable locations in Mexico and the US. Its focus on copper exploration, particularly in the Hot Breccia project in Arizona, could be a growth factor and value-adding, given the increasing demand for copper in key sectors such as the electrical and automotive industries. Rheinmetall is further expanding its expertise in sustainable mobility and energy alongside its profitable armaments division. The focus here is on urban and future-oriented solutions such as space-saving charging curbs for electric vehicles and advanced components for electromobility. BASF is facing major challenges in a changing market environment. The planned closure of production facilities at the Ludwigshafen site by the end of 2025 highlights the cost pressure and the associated structural adjustments needed to maintain competitiveness in an increasingly regulated and cost-intensive European market.