North American Freight Rail Performance Q1 2025 Financial and Operations Review A business of Marsh McLennan INTRODUCTION Oliver Wyman's quarterly North American Freight Rail Performance report compiles and analyzes publicly available data from the seven largest North American railroads: Data sources include the US Surface Transportation Board (STB), the Association of American Railroads (AAR), the Federal Railroad Administration (FRA), industry financial reports, and public company information All dollar f ...

10项核心系统现代化关键考量 整合下一代核心银行平 台 集成下一代核心银行平台 引言 当今许多银行面临着现代化其技术基础设施的巨大压力，其中一些银行的遗留核心银行系统已接近其 生命周期终点。曾经作为金融服务支柱的遗留单体核心系统，如今正越来越多地被视为瓶颈。对可扩 展、灵活及云原生的解决方案的需求，已将行业关注的焦点转向下一代核心平台。 下一代核心系统在解决方案上采用不同的方法——有些侧重于产品的可定制性，而另一些则专注于优 先考虑上市速度的现成模块。它们都能使银行拥抱云原生架构，优先进行渐进式系统现代化，并在大 规模上部署创新产品。针对银行中产品创新、监管合规、成本削减和运营效率等复杂需求，核心系统 转型需要一个周全且面向未来的方法。 核心现代化是我们客户目前面临的最复杂和高风险的转型之一。在 Oli ver Wyman，我们拥有一支经验丰富的专家团队，他们已经帮助全球 （包括最近在亚太地区）交付并降低此类核心转型项目的风险。 集成下一代核心银行平台 10 项核心系统现代化关键考量 1 项目建立、治理和风险管 理 设立合适的治理结构，例如建立控制塔（Control T ower），以引入新的工作方式、领导原 ...

| Executive summary 3 | | --- | | Claims trends 4 | | Volume 4 | | Regional impact analysis 5 | | Claims by type of loss 6 | | Severity 7 | | Hurricane Milton 8 | | Pricing data services 12 | | Labor and materials 12 | | Labor costs 13 | | Labor costs by trade 14 | | Materials 14 | | Fuel costs 17 | | Construction and reconstruction trends 18 | | Residential reconstruction costs 18 | | Commercial reconstruction costs 18 | | Economic indicators 18 | | Conclusion 22 | Quarterly Property Report October - Decem ...

Investment Rating - The report does not explicitly provide an investment rating for the automotive industry but highlights significant disparities in labor costs and competitive pressures among different automaker archetypes [3][4]. Core Insights - The global automotive industry is facing challenges such as tariffs, aggressive competition from Chinese manufacturers, and a slowdown in battery electric vehicle sales, necessitating effective cost management and production strategies [3][4]. - Labor cost per vehicle is a critical metric for assessing automaker competitiveness and profitability, with labor typically accounting for 65% to 70% of total conversion costs [5][8]. - The analysis categorizes automakers into four archetypes based on labor cost per vehicle, revealing substantial differences in productivity and wage rates [8][10]. Summary by Sections Labor Cost Analysis - The report examines labor costs across over 250 vehicle assembly plants globally, emphasizing the importance of labor cost per vehicle in determining competitiveness [4][5]. - Labor cost per vehicle varies significantly among different automaker categories, with Euro premiums averaging $2,232, EV-only manufacturers at $1,660, mainstream model manufacturers at $880, and Chinese car manufacturers at $585 [10][11]. Automaker Archetypes - **Euro Premiums**: This group has the highest labor cost per vehicle, averaging $2,232, and includes brands like Mercedes-Benz and BMW. They face high production costs due to strong labor unions and complex manufacturing processes [11][13]. - **EV-Only Manufacturers**: This category includes startups like Tesla, with labor costs ranging from $1,502 to $13,291. They struggle with low production volumes and high costs due to the lack of organized labor contracts [14]. - **Mainstream Model Manufacturers**: Traditional automakers in this group have an average labor cost of $880, benefiting from diversified manufacturing networks and lower production costs [15][16]. - **Chinese Car Manufacturers**: With an average labor cost of $585, this group benefits from low wages and high efficiency, leading to the lowest overall conversion costs [17][18]. Global Labor Cost Disparities - The report highlights that China is no longer the lowest labor cost nation, with countries like Morocco and Romania emerging as low-cost production centers [19][20]. - Morocco has become a key production hub for French manufacturers, while Mexico serves as a strategic base for various global automakers [21][22]. Production Variables Influencing Labor Cost - Factors such as design complexity, consumer choices, energy costs, and supply chain restructuring significantly impact labor costs per vehicle [24][33]. - The report emphasizes the importance of engineered hours per vehicle as a metric for productivity, with Chinese manufacturers showing lower engineered hours compared to Euro premiums [27][28]. Recommended Strategies for Automakers - **Euro Premiums**: Need to restructure for better efficiency and margin optimization, targeting a labor cost per vehicle closer to $1,500 [36][37]. - **EV-Only Manufacturers**: Should focus on scaling operations and establishing efficient production systems to reduce labor costs [38][39]. - **Mainstream Model Manufacturers**: Must invest in technology to maintain competitiveness and optimize production processes [41][42]. - **Chinese Car Manufacturers**: Should enhance vehicle quality to build brand value and gain trust in international markets [43]. Conclusion - The report provides insights into labor cost dynamics in the automotive industry, highlighting the need for strategic adjustments in response to competitive pressures and market changes [44].

Investment Rating - The report emphasizes a positive outlook on the telecom industry, particularly regarding the integration of AI and digital agents, suggesting significant potential for operational efficiency and growth [4][10][12]. Core Insights - The telecom industry is undergoing a transformation driven by AI and digital agents, which are seen as catalysts for enhancing operational efficiency, customer engagement, and strategic decision-making [4][9]. - Approximately 94% of telecom operators believe that generative AI will significantly impact their businesses within the next five years, indicating a strong consensus on the technology's potential [12]. - Successful telecom operators are adapting their operating models to fully leverage generative AI and digital agents, focusing on high-value use cases and aligning AI initiatives with business goals [13][14]. Summary by Sections The Disruptive Impact of AI and Digital Agents for Telcos - AI is a powerful catalyst for transformation across all aspects of telecom operations, enhancing processes, systems, and ways of working [9]. - Telecom companies are rapidly adopting AI, with generative AI expected to be integrated into business processes within three years, impacting customer experience and network quality [10][11]. Impact on Network and Field Operations - AI implementation can lead to a reduction in capital expenditures (CapEx) and operational expenditures (OpEx) by 20-40%, while increasing ROI by 10-15% through automation [42]. - AI-driven network automation is anticipated to become standard practice, significantly enhancing operational performance [42][46]. Impact on Customer Service - The integration of AI in customer service is projected to reduce CapEx by 30-40% and OpEx by 25-35%, while also decreasing average handling time by 1.5 to 2 times [52]. - Generative AI-powered digital agents could create over $2 trillion in value, particularly in customer service management functions [53]. Impact on Technology Function - Generative AI has the potential to optimize IT spending by 14-35%, which is significant given that IT spend accounts for 3-7% of telecom revenue [61]. - AI enhances the Software Development Life Cycle (SDLC), enabling faster code development and reducing technology debt, which often consumes over 30% of resources in large telecom operators [66]. Impact on Topline Performance - Generative AI is helping telecom companies create more targeted marketing messages, leading to a reduction in churn by 3-5 basis points monthly and an increase in average revenue per user (ARPU) by 2-5% [74]. - AI agents are expected to drive significant revenue growth by managing tasks such as lead generation and customer engagement [75]. Navigating to Become an AI-First Telco - To successfully integrate AI, telecom operators must develop a comprehensive capability stack that includes technical elements, vision, operating models, and change management [81]. - Key practices for scaling AI include starting with high-value use cases, securing quick wins, and embracing agile experimentation [86]. Conclusion - The true value of AI-enabled transformation lies in enhancing business outcomes, requiring telecom companies to reimagine processes and operating models while effectively managing change [90].

Investment Rating - The MRO industry is rated positively, with expectations of continued financial performance improvement and increased investment activity over the next two years [7][8]. Core Insights - The MRO industry has fully recovered from the COVID-19 pandemic, with spending forecasted to reach $120 billion in 2024, a 7.2% increase from the pre-COVID peak in 2019 [4][67]. - The industry is expected to grow at an annual rate of 2.7% through 2035, reaching $156 billion [4][5]. - Key disruptors identified include material shortages, labor and material cost management, and the adoption of generative AI [10][12]. Demand and Market Trends - The MRO market reached over $114 billion in 2024, with a forecasted increase to $120 billion in 2025 due to factors like aging fleets and increased aircraft utilization [4][67]. - The MRO sector is experiencing a "super cycle" driven by higher maintenance needs of an aging fleet [67]. Business Climate - 68% of survey respondents believe the financial performance of the MRO industry improved over the past year, with 72% expecting continued improvement [7]. - Nearly three-quarters of respondents anticipate increased outside investment and deal activity in the next two years [7]. Investment Segments - Engines are expected to attract the most investment, followed by components and heavy airframes [8]. - The engine segment is favored due to pronounced supply chain challenges and better margins compared to labor-intensive segments [8]. Disruptors - Material shortages emerged as the top disruptor, followed by labor and material cost management [10]. - Changes to fleet plans and the adoption of generative AI are also significant disruptors [12]. Supply Chain Challenges - Supply chain issues persist, with over half of respondents expecting challenges to last at least another 18 months [15]. - Two-thirds of respondents indicated a need for improved supplier performance and inventory availability to regain confidence in the supply chain [16]. Material Cost Inflation - Material costs increased by an average of 7.7% last year, with expectations of a 6.3% rise next year [18][19]. - The MRO/OEM segment experienced slightly higher cost increases compared to operators [18]. Labor Market Dynamics - Labor supply remains strained, with wage inflation reported at 6.6% last year, and a projected slowdown to 5.7% next year [30][31]. - The shortfall of certified mechanics in North America is expected to grow to 19% by 2028 [33]. Labor Productivity - Over half of respondents reported improvements in frontline labor productivity, driven by better training and communication [38]. - MROs/OEMs reported slightly better productivity gains compared to operators [38]. AI Adoption - AI adoption in the MRO industry is increasing, with 64% of respondents reporting value realization from AI investments [54]. - The focus of AI applications includes cost management, efficiency, and materials forecasting [58][59]. Conclusion - The MRO industry is on a growth trajectory, surpassing pre-COVID levels and expected to exceed $150 billion in the next decade [67][68]. - Challenges remain in material and labor cost inflation, supply chain weaknesses, and labor supply constraints, but strategies are being implemented to enhance productivity and embrace AI [68].

Investment Rating - The report emphasizes the potential for value-led grocery retail in the GCC, suggesting a positive outlook for investment in this sector as retailers adapt to changing consumer behaviors and preferences [4][5]. Core Insights - The grocery retail landscape in the GCC is becoming increasingly saturated, necessitating differentiation among retailers to drive growth [3]. - Value-led grocery retailing addresses the demand for affordability and offers a pathway for market disruption, focusing on compelling value propositions and operational efficiency [4][5]. - Consumer spending power is shifting, with a significant portion of households in Saudi Arabia reporting decreased disposable income, highlighting the importance of value-driven shopping [6][7][11]. Summary by Sections Introduction - The report discusses the challenges faced by retailers in the GCC due to market saturation and shifting consumer priorities [3]. The Opportunity in Value-Led Grocery Retail - A detailed analysis of Saudi Arabia reveals that over 31% of households experienced a drop in income in 2024, with 40% reporting decreased savings [7][10]. - Consumer behavior is shifting towards price comparison and seeking lower-priced stores, indicating a strong demand for value-driven offerings [8][11]. Learning from Global Leaders - Successful international value-led grocery retailers utilize strategies such as attractive pricing propositions, streamlined operations, and aggressive scaling to thrive in competitive markets [19][22]. - The report outlines a two-step approach where retailers first establish a strong value perception before enhancing their offerings [24][26]. Thoughts on Winning Value-Led Grocery Retail Models in the GCC - The report highlights the unique dynamics of the GCC market, including cultural diversity and income inequality, which influence shopping habits [36][38]. - It emphasizes the need for retailers to adapt global success factors to the regional context to effectively capture market share [39]. Key Dimensions for Building a Winning Model - Retailers must focus on attractive propositions, streamlined operations, and effective scaling to succeed in the GCC [45][46]. Value-Led Archetypes - Four archetypes for value-led grocery retailers are identified: Neighborhood discount model, Basic discount model, Mature discount model, and Full-basket value-led model, each with distinct characteristics and market applicability [48][50]. Conclusion - The report concludes that unlocking the potential of value-led grocery retail in the GCC requires a strategic, consumer-focused approach that resonates with the region's diverse demographics [60][61].

Investment Rating - The report indicates a stable investment outlook for the commodity trading industry in 2024, following a period of extraordinary growth due to geopolitical uncertainties [3][4]. Core Insights - The commodity trading industry is establishing a more stable baseline for performance in 2024, with overall gross profits expected to decline to approximately $95 billion, marking the lowest level in three years but still representing the third-best year on record [7][8]. - The competitive landscape is intensifying, with the market share of the top 10 traders decreasing by 10 percentage points, necessitating a balance between growth demands and return efficiency [5][16]. - The report emphasizes the importance of operational resilience and portfolio flexibility for traders to succeed in the coming years [5][8]. Summary by Sections Market Stability - The overall gross profit for commodity trading is projected to decline to around $95 billion in 2024, driven by reduced volatility as energy markets stabilize [7]. - Major commodity flows have been reconfigured to adapt to supply chain disruptions experienced in 2022, leading to lower prices and volatility [7][8]. Profit Trends - Gross profits have more than doubled since 2019, highlighting the ongoing positive trends in the commodity trading sector [8]. - The report notes that the decline in profit margins exposes the complexities and costs faced by trading organizations in maximizing returns during periods of record volatility [13][15]. Competitive Landscape - The dominance of the top 10 traditional traders is weakening, with their market share declining by 10 percentage points [16][25]. - New market participants, including producers and consumers, are increasingly capturing physical profits, necessitating established players to adapt their operational models [20][21]. Operational Efficiency - Traders are urged to reassess their operational models to prioritize efficiency and manage the complexities of rapid growth [14][40]. - The report highlights the need for enhanced risk management practices as traders diversify their portfolios and face new credit exposures [32][42]. Future Growth Strategies - The report suggests that traders must focus on systematic approaches to options and risk management to navigate the evolving market landscape [26][27]. - Emphasis is placed on the importance of technology and data systems in optimizing asset management and enhancing decision-making processes [30][31].