It’s fair to say that 2017 was a turbulent year. Yet for all the doom and gloom news coverage, it was also a year of substantial success for businesses. Global economies have begun a substantial recovery following the 2007-2008 crisis, and entrepreneurs have found a way to thrive amongst the relative chaos.
Nowhere has this been more true – or arguably applicable – than in the United States. Both despite and because of the tide of political and current events, American business is booming. From mergers to Musk to Trump’s tax bill, here are some of 2017’s American business success stories.
Tech triumphs
2017 was another exceptionally strong year for the US tech industry. Silicon Valley mainstay Apple reestablished itself after a slightly bumpy period, releasing what is widely considered to be its best ever phone, and refreshing its line of laptop and desktop Macs. Google released its Pixel 2 flagship and significant updates to its Google Home offering, while Microsoft launched its powerful Xbox One X console to significant fanfare.
The high tech industry has also gone from strength to strength – and Elon Musk’s ventures have been at the heart of it. SpaceX overcame two disastrous launches to achieve a number of world firsts in 2017: relaunching and recovering a used rocket, re-flying a commercial cargo spacecraft, and recovering the payload fairing of a spacecraft.
Car manufacturer Tesla had a particularly notable year. While struggling with demand for the Model 3, the company has debuted an electric roadster and an electric long-haul truck, both to significant interest. The company’s SolarCity subsidiary meanwhile has continued to innovate in energy storage solutions, with highly publicised battery and solar projects in Australia and Puerto Rico – both originating from short-notice promises by Musk to solve different crises.
Economics and policy
It’s impossible to talk about American business in 2017 without mentioning America’s most divisive figure: Donald Trump. The US President has stood like a colossus over the year’s major events, dictating conversation and policy while making a few faux pas along the way.
What some people miss amongst the tabloid stories is just how effective his economic policies seem to have been. America is in an almost unprecedented period of economic growth, with record low unemployment and manufacturing output at a 13-year high. Consumer confidence is also way up, while 79% of Americans believe the economy is currently in excellent or good shape, or expect it to improve in the near future.
Trump is also seeking to deliver on tax reform, one of his major election promises. The tax bill currently passing through Congress would prove beneficial to a majority of families and businesses, with significantly less red tape surrounding income reporting. Income tax would fall to 20%, while the standard income deduction for individuals and families would almost double, to $12,000 and $25,000 respectively.
Elsewhere, some policies dating from the Obama administration have reaped major dividends – at least for certain states. The legalisation of marijuana for medical or recreational use has expanded to 23 states in total, and the industry is booming as a result. From an initial focus on paraphernalia and edibles, 2017 has seen the focus shift to advanced cultivation, subscription based offerings and information providers (e.g. product awareness and legal compliance).
Mergers and acquisitions
The strength of American business is perhaps best reflected in the country’s mergers and acquisitions. Major deals have underscored the whole of 2017, perhaps owing to the renewed strength of the Dollar – and the comparative weakness of some other currencies.
Thanks to Brexit and the fall in value of the Pound Sterling, American businesses have particularly focused on acquiring UK businesses. These include:
- Shazam to Apple
- Worldpay to Vantiv
- Millarworld to Netflix
- Jimmy Choo to Michael Kors
- Rapha to RZC Investments
- Weetabix to Post Holdings
Several acquisitions in 2017 also rank among the most expensive of all time. Media mergers feature heavily: see Time Inc’s purchase by Meredith Corporation and the Koch Brothers, or the acquisition of Japanese ad agency ADK by Bain. A merger between Fox and Disney may be completed before the end of the year, too, giving the media giant unprecedented reach.
The food industry has been potentially revolutionised with the $14bn acquisition of Whole Foods by Amazon, boosting the company’s Pantry offering. Intel’s purchase of Mobileye meanwhile is the latest in a series of driverless tech buys, while Qualcomm scored a bargain with NXP, boosting its tech manufacturing output. Google also struck a deal to acquire much of HTC’s intellectual property, enhancing its growing mobile hardware division.
Some less notable M&As also transpired with similarly colossal figures. Retail pharmacy giant CVS purchased insurance firm Aetna for $69bn, in a move apparently designed to shut out its online rivals. And Gilead Sciences acquired Kite Pharma for $12bn, bolstering its research potential for innovative cancer treatments.
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