The R&D Index for the week ending August 31, 2018 closed at 4,884.84 for the 25 companies in the R&D Index. The Index was up 2.50% (or 119.35 basis points) from the week ending August 24, 2018. Fourteen R&D Index companies gained value last week from 0.10% (Astra Zeneca) to 5.31% (Apple Computer). Eleven R&D Index companies lost value last week from -0.11% (Eli Lilly Co.) to -2.08% (Pfizer). R&D Index member Amazon made a statement during the week by closing above 2,000 for the first time.
The U.S. Dept. of Commerce reported on Thursday that the personal-consumption-expenditures price index, a broad inflation measure, rose 0.1% from June to July. For the past year, the index is up 2.3%, its largest increase since early 2012. These data reinforce the Federal Reserve’s plans to increase short-term interest rates possibly as early as its next meeting on September 25-26, 2018.
Automotive updates
2019 electric vehicle (EV) production for R&D Index member General Motors in China were delayed last week when it was announced that the proposed batteries for its new Buick Velite 6 vehicles failed to meet performance and safety standards during testing. The batteries for GM’s EVs were supplied by A123 Systems, a Chinese-owned firm based in Livonia, Michigan. GM launched its first EV, the Baojun E100, in China last year, while Nissan and R&D Index member VW introduced EVs to the China market this year. China’s EV-maker NIO launched an IPO last week, hoping to raise $1.3 billion. China currently has about 500 EV manufacturers for its booming EV market.
Ford Motor canceled its plans last week to ship its low-cost 2019 Focus subcompact vehicle from China to the U.S. due to the prospect of 25% tariffs, thereby making it unprofitable. Ford stated that it will still ship Focus products to other countries from China in 2019, but will phase out the brand for the U.S. market.
R&D Index member Toyota announced last week that it was investing about $500 million in Uber Technologies to work together on autonomous vehicles. Uber will integrate self-driving technologies into Toyota Sienna minivans for use in its ride-hailing network. Uber spent about $750 million in self-driving technologies in 2017 before making severe cuts this year due to a fatal crash in Arizona in early-2018. The deal allows Uber to reduce its expensive development cost and provides Toyota with an autonomous market application that it has lagged behind its competitors.
R&D Index Week Ending August 31, 2018
| Ticker | Exchange | 2018 R&D millions U.S. $ | 08/24/18 | 08/31/18 | 8/31/18 to 8/24/18 | 8/31/18 to 12/29/17 | ||
| 1 | Amazon | AMZN | NASDAQ | 26,750 | 1,905.39 | 2,012.71 | 0.54% | 72.10% |
| 2 | Alphabet/Google | GOOGL | NASDAQ | 18,796 | 1,236.75 | 1,231.80 | -0.40% | 16.94% |
| 3 | Apple | AAPL | NASDAQ | 14,037 | 216.16 | 227.63 | 5.31% | 34.51% |
| 4 | Intel | INTC | NASDAQ | 13,702 | 47.66 | 48.43 | 1.64% | 4.92% |
| 5 | Microsoft | MSFT | NASDAQ | 13,558 | 108.40 | 112.33 | 3.63% | 31.32% |
| 6 | Roche Pharm | RHHBY | OTC | 12,284 | 30.58 | 30.96 | 1.24% | -1.96% |
| 7 | Johnson & Johnson | JNJ | NYSE | 11,493 | 135.95 | 134.69 | -0.93% | -3.60% |
| 8 | Merck & Co. | MRK | NYSE | 11,323 | 69.04 | 68.59 | -0.65% | 21.89% |
| 9 | Volkswagen AG | VWAGY | OTC | 10,915 | 15.84 | 16.00 | 1.01% | -60.44% |
| 10 | Toyota | TM | NYSE | 10,848 | 122.84 | 124.08 | 1.01% | -2.43% |
| 11 | Novartis | NVS | NYSE | 8,934 | 83.75 | 83.01 | -0.88% | -1.13% |
| 12 | Honda | HMC | NYSE | 8,180 | 29.68 | 29.63 | -0.17% | -13.06% |
| 13 | Pfizer | PFE | NYSE | 7,942 | 42.40 | 41.52 | -2.08% | 14.63% |
| 14 | Daimler | DDAIY | OTC | 7,615 | 63.66 | 64.65 | 1.56% | -23.54% |
| 15 | General Motors | GM | NYSE | 7,278 | 35.95 | 36.05 | 0.28% | -12.05% |
| 16 | Oracle | ORCL | NYSE | 7,001 | 49.26 | 48.58 | -1.38% | 2.75% |
| 17 | Bristol-Myers Squibb | BMY | NYSE | 6,981 | 59.97 | 60.55 | 0.97% | -1.19% |
| 18 | Eli Lilly Co | LLY | NYSE | 6,769 | 105.77 | 105.65 | -0.11% | 25.09% |
| 19 | GlaxoSmithKline | GSK | NYSE | 6,394 | 41.28 | 40.50 | -1.89% | 14.18% |
| 20 | Cisco | CSCO | NASDAQ | 6,009 | 46.32 | 47.77 | 3.13% | 24.73% |
| 21 | IBM | IBM | NYSE | 5,842 | 146.04 | 146.48 | 0.30% | -4.52% |
| 22 | Bayer AG | BAYN | OTC | 5,743 | 23.77 | 23.33 | -1.85% | -24.96% |
| 23 | Astra Zeneca PLC | AZN | NYSE | 5,483 | 38.30 | 38.34 | 0.10% | 10.49% |
| 24 | Qualcomm | QCOM | NASDAQ | 5,183 | 67.15 | 68.71 | 2.32% | 7.33% |
| 25 | Sanofi SA | SNY | NYSE | 4,694 | 43.58 | 42.85 | -1.68% | -0.35% |
| Total | 243,754 | 4,765.49 | 4,884.84 | 2.50% | 28.83% | |||
| Biopharmaceutical | 674.39 | 669.99 | -0.65% | 5.06% | ||||
| Automotive | 267.97 | 270.41 | 0.91% | -17.37% | ||||
| ICT | 1,917.74 | 1,931.73 | 0.73% | 16.56% | ||||
R&D Magazine’s R&D Index is a weekly stock market summary of the top international companies involved in research and development. The top 25 industrial spenders of R&D in 2017 were selected based on the latest listings from Schonfeld & Associates’ June 2018 R&D Ratios & Budgets. These 25 companies include pharmaceutical (11 companies), automotive (5), ICT (8) and conglomerate (1) organizations who invested a cumulative total of more than $209 billion in R&D in 2017, or approximately 10% of all the R&D spent in the world by government, industries and academia combined, according to R&D Magazine’s 2018 Global R&D Funding Forecast. The stock prices used in the R&D Index are tabulated from NASDAQ, NYSE, XETRA and OTC common stock prices (in U.S. dollars) for the companies selected at the close of stock trading business on the Friday preceding the publication of the R&D Index in R&D Magazine’s R&D Daily eNewsletter.
The companies used in the R&D Index include Amazon, Alphabet/Google, Microsoft, Intel, Apple, Volkswagen AG, Roche Pharma, Toyota, Johnson & Johnson, Novartis, General Motors, Pfizer, Bristol-Myers Squibb, Cisco, Qualcomm, Oracle, Honda Motor Company, Astra Zeneca plc, Merck & Company, Daimler, Bayer AG, Sanofi SA, IBM, GlaxoSmithKline and Eli Lilly Co. Stock prices are based on those stocks traded on the U.S. exchanges. R&D Index trends (in the stock prices) are just one indicator of the amount of capital available to these high-technology companies to invest in R&D and should not be implied to indicate the absolute value of R&D investments made by these organizations. The companies chosen for the R&D Index have very large sophisticated internal and global R&D organizations with each company investing between $4.5 and $17 billion annually on their R&D efforts.
