🚗 NYC’s traffic tax
Hey Snackers,
The US Supreme Court sided with Jack Daniel’s in its case against a dog toy parodying its whiskey bottle with the label “Bad Spaniels.” It’s a defining moment for trade-bark-infringement law.
The S&P 500 and Nasdaq closed at their highest levels in over a year as traders continued betting that the Fed won’t hike rates tomorrow (the central bank’s meeting kicks off today). Also today: the US gets its consumer-inflation report for May, which could influence expectations.
NYC could become the first US city with a congestion toll, easing (and adding to) commuting woes
Driving gets surge pricing… New York City could become the first US city to charge congestion tolls, and others could follow to ease traffic troubles. Last month the Federal Highway Administration greenlighted Gotham’s congestion-pricing plan, and yesterday was the final day for public objections. The Biden admin is expected to give final approval soon, which would mean a pricier commute for millions.
Big fees: As soon as next spring, drivers heading below 60th Street could face congestion tolls ranging from $9 to $23, depending on peak traffic hours.
Small print: Cars carrying people with disabilities and emergency vehicles are expected to be exempt. Residents earning under $60K/year may also qualify for a tax credit.
FYI: The Big Apple’s expected to rake in $1B+/year from the tolls, helping offset billions in losses as fewer people take public transit and splurge on lunch bowls (blame: WFH).
Feeling extra congested… and it’s not spring allergies. Higher fuel prices + more congestion (think: burning gas while stuck in traffic) cost the average commuter almost $900 last year — nearly 3X as much as in 2021. While no American cities have adopted congestion pricing yet, Stockholm, London, Singapore, and others have had it for years. They’ve seen fewer traffic jams — and Stockholm saw fewer asthma attacks because of less pollution. Now traffic-plagued Los Angeles is also considering charging drivers during peak hours.
Clearer lanes come at a cost… Taxi and ride-hail drivers have condemned congestion tolls, saying they’ll hurt biz and raise fares. The MTA says fare hikes triggered by the new tolls could curb cab and ride-hail demand by 17%. Meanwhile, commuters worry that extra fees could strain their already tight budgets as more employers mandate a return to the office.
Nike rethinks its direct-to-consumer pivot and repairs relationships with retailers
It wasn’t you — it was us… After years of focusing on its direct-to-consumer (D2C) business, Nike is back in retailers’ inboxes asking if they’re free to catch up sometime. The sneaker icon has expanded its wholesale relationships with the likes of Macy’s, Foot Locker, and DSW parent Designer Brands. It’s an about-face from the company’s recent strategy:
Split: Since 2018, Nike has halved its wholesale business, ditching deals with thousands of small retailers and downsizing distribution to chains like Foot Locker. The shift was part of a profit-pumping attempt to boost D2C sales through Nike sites and stores.
Second thoughts: In the past two quarters, Nike’s wholesale biz logged impressive growth, outpacing D2C in the fall. Inventory glut and ensuing markdowns hurt profits, making the company further question its D2C focus.
Rediscovering the intermediary… A few years ago, D2C was all the rage. But shifting consumer habits have seen D2C-native brands lean into wholesale deals to boost revenue. After disappointing earnings, Allbirds announced it would consider expanding deals with partners like Nordstrom and REI. Adidas, struggling with big losses from its Yeezy split, recently said that wholesale would play a larger role in its strategy. Peloton began selling gear on Amazon and in Dick’s stores last fall. Beyond apparel, Casper mattresses can now be found at Mattress Warehouse and Glossier products are stocked at Sephora.
Ownership isn’t all it’s chalked up to be… The D2C model lets brands own more of their business, control how their products are sold, and glean more info about their customers. But it comes with higher shipping, marketing, labor, and tech costs. For companies chasing profits and presence, maintaining wholesale relationships can take some of the pressure off.
Heard on the Block: "layer 1"
🏗️ Like when a city planner starts with the electrical grid…
Crypto developers work to scale blockchains as they grow in users and in use cases. But the foundation new crypto additions are built on, the base blockchain itself, is called a "layer 1." (The additions are — you guessed it — layer 2s.)
The price of solana and cardano slipped 30% last week after the SEC said in a lawsuit that the cryptos are securities. The coins are associated with layer-1 blockchains (also dubbed solana and cardano), which compete with the ethereum blockchain (aka: "ETH killers").
What else we’re Snackin’
UnMooch: Netflix's password-sharing crackdown is said to be working. Since the streamer told US subscribers they’ll need to pay $8 per non-household user, it’s had its four biggest signup days on record.
r/protest: Thousands of Reddit's most popular forums — including r/funny and r/aww — paused activity to protest new developer fees. As platforms (Twitch, Twitter) try to monetize beyond ads, users are fighting back.
Undelivered: UPS workers may soon launch the largest strike ever against a single US employer and shock the supply chain. Between screenwriters and dockworkers, it could be a Hot Strike Summer.
Spark: Three EV-charging-station companies said they'll make Tesla-compatible stations. Tesla's charger is closer to becoming the US standard, with GM and Ford saying they'll adopt the design.
Pushback: Cracker Barrel is facing calls for a boycott after posting a Pride Month pic on Facebook. Target, Kohl’s, and Bud Light also faced backlash for supporting LGBTQ+ communities.
Tuesday
May consumer-price index released
Fed meeting begins
Authors of this Snacks own ethereum and shares of: Amazon, GM, and Tesla