The R&D World Index climbed modestly this week thanks to Intel’s substantial gains and strategic expansions in Asia. At the same time, automotive heavyweight Honda faced significant setbacks, highlighting a week of contrasting fortunes in the R&D landscape.

The R&D World Index (RDWI) for the week ending November 8, 2024, closed at 3,918.29 for the 25 companies in the RDWI. The Index was up 1.62% (or 63.64 basis points). Twelve RDWI members gained value last week from 1.02% (Merck & Co.) to 12.93% (Intel). Thirteen RDWI members lost value the previous week from -0.33% (Bristol-Myers Squibb) to -11.52% (Honda).

Technology R&D

 

Chip-based R&D expanding in Asia

CATL (Contemporary Amperex Technology Co.), Fujian, China, announced last week that it is accelerating its all-solid-state battery project and has expanded its R&D staff by more than 1,000 employees in 2024. Its advanced battery technology is now in trial production with a 10 Ah verification platform. The company expects to begin small-volume output of the new battery by 2027. It hopes to create batteries with an energy density of up to 500 Wh/kg for lithium ternary batteries, which is a 40% improvement over current technologies. However, according to the company, charging speed and cycle life require optimization before mass production.

Apple debuts subsidiary in India

Apple Inc., Cupertino, California, announced last week the opening of its first subsidiary in India, Apple Operations India, in Bengaluru, Karnataka. According to regulatory filings, the subsidiary is expected to focus on research, design, testing, and support for third-party manufacturers by providing hardware, software, and other services. It plans to procure engineering equipment, lease facilities, hire engineers, and provide failure analysis services to Apple’s group companies.

Taiwan to block GPU shipments to Chinese customers

Taiwan Semiconductor Manufacturing Company (TSMC), Hsinchu Science Park, Taiwan, has been sent a letter from the U.S. Department of Commerce (DOC), Washington, DC, to halt shipments of advanced chips to Chinese customers that are often used in artificial intelligence (AI) applications starting last week. The DOC letter stated that the U.S. would impose export restrictions on specific sophisticated chips of 7 nm or more advanced designs that power AI accelerators and graphics processing units. The letter was posted one week after TSMC notified the DOC that one of its chips had been found in a Huawei AI processor, as reported in Reuters. Technology research firm Tech Insights, Ottawa, Canada, had taken apart the Huawei product, revealing the TSMC chip and apparent violation of export controls.

LG bolsters R&D In Vietnam

LG Electronics, Seoul, South Korea, announced last week that it was strengthening its R&D capabilities in Vietnam, expanding its local research program into vehicle components, the webOS platform, and home appliances. LG established its local R&D network in Vietnam in 2016 by opening its R&D center in Hanoi, followed by additional branch R&D offices in Haiphong and Danang in 2020. The company reorganized and expanded its Vietnam research structure, which has now become one of Southeast Asia’s key research institutes.

DuPont sees growth in AI

DuPont de Nemours Inc., Wilmington, Delaware, announced growth in quarterly sales and profits last week as its AI-based businesses in semiconductor products expanded. The company’s profit in the third quarter was $454 million — a significant jump from the $319 million in the same quarter last year.  Chip-making is a crucial industry for chemical and materials-making companies, with a 20% sales increase mainly based on growing demand in China. According to the company, China has half of the global semiconductor factories currently being built, and some are stocking up on DuPont products before they open. DuPont said it would complete the spinoff of its water and electronics businesses by the end of 2025.

Automotive R&D

Toyota cuts forecast thanks to slumping sales

RDW Index member Toyota, Toyota City, Japan, announced last week that it cut its annual forecast for group vehicle sales after its second-quarter profit was reduced by half due to weaker global sales. Toyota had benefited from a shift in U.S. customers to hybrid vehicles amid concerns about charging problems and higher prices associated with pure electric vehicles (EVs). EVs and hybrid vehicles made up nearly half of the company’s sales in the second quarter, up from a third in 2023. According to analysts, the changes in sales forecasts were not expected to immediately affect the company’s overall annual R&D investments of $20 billion.

Corporate news

China approves $1.4T local debt rescue package

Last week, China’s top legislative body approved a 10 trillion yuan ($1.4 trillion) package to help local governments restructure their mounting off-balance debts. The package, focused on debt restructuring rather than direct stimulus, disappointed Chinese investors who had hoped for broader economic support measures. Market concerns were further amplified by potential economic challenges ahead, particularly regarding Donald Trump’s trade policies. Trump has proposed tariffs as high as 60% on Chinese imports, significantly higher than the current average level of 12.5%, though most economists expect a more moderate increase to 20% to 22% if implemented.

TSMC eyes next-gen EUV tools

Last week, TSMC stated that it prioritizes acquiring high numerical aperture (NA) extreme ultraviolet (EUV) scanners for its R&D operations. The company’s EUV tool count was ten times higher in 2023 compared to 2019 and accounted for 56% of the global installed base. TSMC plans first to bring its high-NA EUV tools for R&D applications to develop the associated infrastructure and patterning solutions for customers. TSMC is expected to receive its first shipment of the EUV tools from ASML, Veldhoven, Netherlands, by the end of 2024. ASML is the only global manufacturer of these tools, which cost about $350 million each. The machines won’t go immediately into production — they require extensive testing, calibration, and engineering work to optimize their high-volume operations. Even then, they may not go into commercial production until after 2030, when TSMC is expected to introduce its A10 node, which is still several generations away.

The R&D World Index

R&D World’s R&D Index is a weekly stock market summary of the top international companies involved in R&D. The top 25 industrial R&D spenders in 2020 were selected based on the latest listings from Schonfeld & Associates’ June 2020 R&D Ratios & Budgets. These 25 companies include pharmaceutical (10 companies), automotive (6 companies), and ICT (9 companies), which invested a cumulative total of nearly 260 billion dollars in R&D in 2019, or approximately 10% of all the R&D spending in the world by government, industries, and academia combined, according to R&D World’s 2021 Global R&D Funding Forecast. The stock prices used in the R&D World Index are tabulated from NASDAQ, NYSE, and OTC common stock prices for the companies selected at the close of stock trading business on the Friday preceding the online publication of the R&D World Index

Company	Ticker	Exchange	2020 R&D Billions $	11/01/24	11/08/24	11/01/24 to 11/08/24	1/1/22 to 11/8/24
Alphabet/Google	GOOGL	NASDAQ	27.30	172.65	179.86	4.18%	24.17%
Microsoft	MSFT	NASDAQ	17.20	410.37	422.54	2.97%	25.64%
Volkswagen AG	VWAGY	OTC	17.26	9.81	9.32	-4.99%	-68.08%
Apple	AAPL	NASDAQ	18.67	222.91	226.96	1.82%	27.81%
Facebook/Meta	META	NASDAQ	13.87	567.16	589.34	3.91%	75.22%
Intel	INTC	NASDAQ	14.50	23.20	26.20	12.93%	-49.13%
Johnson & Johnson	JNJ	NYSE	13.75	160.13	155.47	-2.91%	-9.12%
Roche Holdings AG	RHHBY	OTC	14.14	39.26	37.61	-4.20%	-27.24%
Merck & Co.	MRK	NYSE	11.38	101.88	102.92	1.02%	34.29%
Novartis	NVS	NYSE	9.39	109.35	106.45	-2.65%	21.70%
Toyota	TM	NYSE	10.72	172.83	172.03	-0.46%	-7.16%
Pfizer	PFE	NYSE	8.34	28.09	26.72	-4.88%	-54.75%
Alibaba	BABA	NYSE	6.01	97.58	94.10	-3.57%	-20.78%
GM	GM	NYSE	6.73	50.96	55.58	9.07%	-5.20%
Honda	HMC	NYSE	8.81	30.29	26.80	-11.52%	5.80%
Ford	F	NYSE	9.34	10.22	10.97	7.34%	-47.18%
AbbVie	ABBV	NYSE	13.95	203.55	199.50	-1.99%	47.34%
Sanofi SA	SNY	NYSE	7.75	53.27	51.32	-3.66%	2.43%
Cisco	CSCO	NASDAQ	6.33	55.50	58.06	4.61%	-8.38%
Bristol-Myers Squibb	BMY	NYSE	7.13	54.32	54.14	-0.33%	-13.17%
Astra Zeneca PLC	AZN	NYSE	6.06	71.42	64.49	-9.70%	10.71%
IBM	IBM	NYSE	5.37	208.25	213.72	2.63%	59.90%
Oracle	ORCL	NYSE	6.93	170.02	189.25	11.31%	117.00%
Eli Lilly & Co.	LLY	NYSE	8.61	818.93	831.54	1.54%	201.04%
Stellantis NV	STLA	NYSE	5.31	13.70	13.40	-2.19%	-31.42%