By Tamsin McMahon - Thursday, November 8, 2012 - 0 Comments
A business recap of energy drinks, electric cars, and Mexican labour
Energy drinks have courted controversy with a business model many see as based on pumping teenagers full of caffeine. But investors have largely tuned out those complaints. Monster Beverage Corp. has been the greatest beneficiary of the stock market’s love for energy drinks. Company shares more than doubled last year, topping $78 in June, as its oversized cans and provocative slogan—“unleash the beast”—made it the largest U.S. energy drink producer by volume.
That was until last week, when its shares plunged nearly 30 per cent on news the Food and Drug Administration is investigating reports five people have died since 2009 after consuming Monster drinks. The FDA said it has not yet linked Monster to any of the deaths, but the bad publicity sparked whispers that Coca-Cola is backing away from plans to buy the company. The stock market, it seems, is finally coming down off its buzz around energy drinks.
Bright Idea: Lube, oil and software fix
Last week, General Motors Co. announced a software update for its Chevrolet Volt, contacting about 4,000 owners of the plug-in hybrid over a glitch that could cause the electric motor to suddenly shut down, even while the car was moving. They were asked to bring their vehicles to a dealer for a fix, but in the future, more software updates might happen automatically and over the air—just like an iPhone. Continue…