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Budget 2022 Auto Sector: Cheers for EVs but cars, bikes don’t get any price cuts |

The Indian automotive sector had many expectations from the Finances 2022 speech by the Finance Minister (FM) Nirmala Sitharaman nowadays but at the end of the working day there was not a great deal to be joyful about for the complete sector. There was one major immediate announcement in the type of a new battery swapping policy that will stimulate new personal gamers to enter this space and operate with point out governments to enrich electrification of public transport. The concentration will be on endorsing cleanse tech and electric powered autos in the public transportation space according to the FM. This announcement will have a important impact on specific EV makers across from the CV space to past-mile connectivity gamers. Nevertheless, the general effect on personal electric powered mobility will be negligible at most effective. That reported, the government’s aim on EV know-how grew to become apparent with the Spending plan announcement now. Firms in the EV house will now locate it less difficult to commit in technological innovation and scale with the assure of a change to electric powered cars.
For the remaining automotive sector, particularly the petrol and diesel auto makers there wasn’t any significant announcement to boost sentiments. Most of the positive announcements were being indirect in character, therefore restricting any rapid good influence that was anticipated. Rs 20,000 crore expense in infrastructure projects together with the growth of Nationwide Highways community by 25,000 km in 2022-23 should enable the Commercial Vehicles (CV) sector as there could be need for new automobiles thanks to these big-scale tasks. Similarly, the concentrate on strengthening the rural economic system will make improvements to shopper sentiment and disposable earnings, therefore major to improved car gross sales in the medium-time period.
The other suitable announcement for the automotive ingredient sector was that of the federal government opening up defence R&D for personal players. This will allow for automobile ingredient corporations to develop a new profits stream in the very long-expression. Nonetheless, this shift will only have a constructive impression on specified huge-scale suppliers who have the scale and technological know-how to meet up with the tricky necessities laid down by the Armed forces. Hence, this announcement is not envisioned to have any sizeable effects on medium and little-scale vehicle component players.
The business was anticipating the federal government to lengthen the duration of the FAME II scheme for electrical vehicles together with some new direct and indirect incentives for adoption of EVs but no these announcements were manufactured. In addition, the auto makers and element gamers have been highlighting their struggle with large taxation, specifically in the two-wheeler room the place up to 28 {cfdf3f5372635aeb15fd3e2aecc7cb5d7150695e02bd72e0a44f1581164ad809} GST is levied on them. This, along with the rising input expenditures is main to car makers expanding rates on a standard foundation. As a outcome, at a time when people today are having difficulties with decrease disposable incomes due to the ongoing pandemic, vehicles are getting far more costly and further than affordability.
We acquired in contact with some executives and field captains from the automotive sector and here’s what they experienced to share.
Samrath Kochar, CEO & Founder of Trontek, a Li-ion battery producer, described the Budget 2022 as expansion oriented. He stated, “The Spending plan amply supplies to advertising adoption of cleanse strength and electric powered automobiles. The battery swapping policy with interoperability will raise adoption of EVs as it will support allay the vary stress and deliver the EVs at par with ICE motor vehicles in phrases of time taken for replenishment of gasoline. Clear mobility has seen increased deployment by passenger-mobility in rural and commercial mobility in urban regions. The focus of passenger-utility automobiles in urban areas and zero fossil gas policy will more leapfrog the growth of thoroughly clean mobility in the state.”
Ankit Kumar, Tech Trader EV (Electric powered automobile) & Drone, explained, “Initially, there were being uncertainties in the minds of investors about the intentions of the Government in terms of the EV industry, but the bulletins made in the 2022 budget have unquestionably quelled doubts. The Government built it amply obvious that EV manufacturing is the next huge thing in its eyesight. This was very encouraging for the EV industry and demonstrates how major the authorities is in pushing for quicker adoption of electric automobiles in the country.
Authorities announcement towards marketing a change to use of public transport in urban areas will persuade investors towards financial investment in the EV sector. This will be complemented by clean tech and governance remedies, specific mobility with zero fossil gasoline policy, and EV Motor vehicles. Finance minister also introduced that the Governing administration will appear out with battery swapping technological know-how to build exclusive zones for electric autos. Integration of Private firms for the growth will also improve investment in the sector.”
Rajeev Singh, Associate and Automotive Sector Leader, Deloitte India claimed, “ Target on general public transportation applying non-fossil fuels must assist in pushing electric motor vehicles (EVs). This, in addition to the battery swapping policy, could generate quicker adoption of EVs.
The battery swapping policy including interoperability could be a major booster for all the startups now working in this space. It could also help push movement to electrification of fleets, primarily for past mile connectivity for both equally, men and women and products.
Sohinder Gill, Director Typical, Culture of Companies of Electric powered Cars (SMEV), claimed, “We welcome the steps introduced by the honorable Finance Minister, now. The spending plan for 2022–23 offers a big impetus to the electric powered automobile (EV) field. Introducing the battery swapping plan and recognizing battery or strength as a assistance will help to create EV infrastructure and enhance the use of EVs in community transportation. It would motivate enterprises engaged in shipping and delivery and vehicle aggregation organizations to include EVs into their fleet. It will generate new avenues for corporations to enterprise into the enterprise of battery swapping. Additionally, creating unique clean up zones will additional accelerate the adoption of EVs and unfold awareness amongst the citizens. The move will reward the total section, i.e E2W, E3W, E-autos, and buses.”
Naveen Munjal (MD Hero Electric), explained, “The last 12 months has seen the EV marketplace witness huge development and the government has been privy to the fact that the way ahead in the mobility sector is to shift to EVs. We hence welcome the shift by Hon’ble Finance Minister for asserting the commencement of battery swapping and battery standardization approach. This go will open up up avenues for more development and enhancement of the EV and electrical power sector in the state. Hero Electric powered has usually been a powerful advocate of standardization of EV battery packs to accelerate EV adoption. Interoperability requirements will support address array stress and anxiety difficulties and battery swapping stations will be an asset to the evolving EV ecosystem throughout the nation. Preserving in line with the Web Zero motivation of 2070 designed by Hon’ble Prime Minister, announcement of the PLI plan concentrating on solar modules and reduction of reliance on non-renewable sources of strength by using the launch of sovereign inexperienced bonds to create a carbon free financial system is a significant phase ahead. All round, we believe that we are steering forward in our determination to generate an emission cost-free region.”
Ravikiran Pothukuchi, Director, Dassault Systemes, mentioned, “Battery-swapping, including improvement of interoperability expectations and a change in direction of public transport with zero fossil gasoline guidelines, as a component of the Spending plan 2022, speed up India’s journey to web-zero carbon commitments, and persuade growth of EV sector in India. Investments in Drone producing, support for space startups and style and design-led production in advancement of a solid ecosystem in India will drive us in direction of a new era to provide. The market along with the offer chain should invest in virtual twin technological know-how to allow collaboration throughout the benefit chain and enhance productiveness in production. Producing design-led mental residence is a should for India to turn out to be a environment chief in these new domains.”
Chetan Maini, Chairman & Co-Founder, Sunlight Mobility, mentioned “Kudos to Govt of India for when again using the leadership in accelerating the changeover to a greener mobility paradigm. The announcement of Battery Swapping policy as a way forward to accelerate penetration of EVs is a move significantly in advance than other folks and will help technology-agnostic possibilities for a potential EV customer. Battery swapping technological innovation addresses essential issues about upfront price, array stress and prolonged charging time enabling more quickly adoption of EVs. As the policy unfolds, it would be fantastic to see the govt addressing crucial details around how consumers can accessibility subsidies (at the moment available for EVs), assortment for every demand standards (as swap batteries, by definition, are lesser and with a lot less selection) and GST for swapping providers in line with EVs. It’s encouraging to see techniques being taken on interoperability benchmarks, we are hopeful that the system of innovation is not impacted while defining these new procedures for the place and glimpse ahead to functioning with the field and the govt to building this a reality.
Vivekananda Hallekere, CEO & Co-Founder, Bounce, claimed “We welcome Honourable Finance Minister’s progressive eyesight to facilitate a lot quicker adoption of electric powered automobiles in the country. With the Budget 2022 -2023 announcement on bringing out a strong battery swapping coverage, this is a vindication of the path that we have pioneered for Bounce. Governing administration and policymakers have recognised battery swapping as the most efficient resolution to speed up EV adoption in India by addressing array stress and anxiety and hesitancy in adoption as nicely as contemplating the pragmatic elements of setting up charging infrastructure – for occasion, house constraints in urban parts for focused charging stations. We imagine this go can empower economical and clean mobility at scale. At Bounce, we are nearing a million battery swaps currently and the Hon’ble Finance Minister’s announcement ties in with our vision that thoroughly clean, reasonably priced mobility is a basic ideal.”

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The Auto Sector Is Electrified as GM, Ford, and Sony Join Tesla’s Party

It’s all go in the autos sector at the start of 2022.


Toyota sped past


General Motors as the top-selling car company in the U.S. in 2021 as the Japanese auto maker’s sales accelerated. In contrast, GM’s U.S. sales went into reverse, partly due to the global chip shortage. GM has held the top spot in the U.S. since 1931, according to Automotive News. Forward-looking investors didn’t seem too concerned, as the stock changed gear, jumping 7.5{cfdf3f5372635aeb15fd3e2aecc7cb5d7150695e02bd72e0a44f1581164ad809} on Tuesday. It could go up another gear as the Detroit auto maker is expected to unveil an all-electric Chevy Silverado Wednesday.


Ford has also been quick off the start line in 2022, announcing plans to double annual production of its F-150 Lightning electric pickup truck to 150,000, due to growing demand. The stock climbed 12{cfdf3f5372635aeb15fd3e2aecc7cb5d7150695e02bd72e0a44f1581164ad809} Tuesday to its highest close in more than 20 years.


Tesla stock also began the year with a bang, surging 13.5{cfdf3f5372635aeb15fd3e2aecc7cb5d7150695e02bd72e0a44f1581164ad809} on Monday after reporting record fourth-quarter deliveries.

As if all that wasn’t enough to turn petrol heads,


Sony announced plans to explore the commercial launch of electric vehicles at the CES trade show in Las Vegas. The Japanese conglomerate, which also unveiled a new prototype electric SUV, will launch Sony Mobility in the spring, a new company aimed at muscling into the EV space.

It isn’t just car makers getting in on the action. Chip maker


Qualcomm’s CEO, Cristiano Amon, said he sees growing opportunities in cars, in an interview with Barron’s, following new partnerships with


Honda,


Renault, and


Volvo.

After a year blighted by semiconductor shortages, production delays, and struggling sales, 2022 was also going to be a big one for the auto industry. It’s off to a blistering start.

—Callum Keown

*** Join MarketWatch personal-finance reporter Jacob Passy today at noon as he talks to Michael Fratantoni, chief economist at the Mortgage Bankers Association, about the implications for the housing and mortgage markets of rising interest rates in 2022. Sign up here.

***

Insurance to Pay for More Expensive At-Home Covid Tests

Insurance companies will be required to reimburse consumers for at-home Covid-19 test kit purchases starting next week.


Walmart and


Kroger raised the price of a two-test kit by


Abbott Laboratories after the end of an agreement with the government to sell them at cost.

  • Walmart, Kroger, and


    Amazon.com     had a deal to sell Abbott’s BinaxNOW tests for $14 but that expired in December The Wall Street Journal reported. Walmart now sells them for $19.98, while Kroger charges $23.99.

  • The U.S. has doubled its purchase of


    Pfizer’s     Covid-19 antiviral pills to treat high-risk individuals, to 20 million treatments. President Joe Biden said the first batch of pills went out Christmas Eve, and more will ship this week.

  • The U.S. reported 1,082,549 new coronavirus infections on Monday, including the delayed count from the holiday weekend, according to Johns Hopkins University. The total is more than double the previous record set five days ago.

  • U.S. residents aged 16 and older who received their second dose of the Pfizer-


    BioNTech     Covid-19 vaccine can get a booster shot five months later, rather than six, the Centers for Disease Control and Prevention said. The CDC also recommended third doses for immunocompromised children aged five to 11.

What’s Next: A CDC vaccine advisory panel will meet Wednesday to consider boosters for 12- to 15-year-olds. The Food and Drug Administration authorized booster doses of the Pfizer-BioNTech Covid-19 vaccine on Monday, but the CDC’s approval is needed before they become available.

—Janet H. Cho

***

Consumer Tech Sales Expected to Slow in 2022

U.S. consumer tech retail sales will slow to 2.8{cfdf3f5372635aeb15fd3e2aecc7cb5d7150695e02bd72e0a44f1581164ad809} growth to $505 billion this year, after a 9.6{cfdf3f5372635aeb15fd3e2aecc7cb5d7150695e02bd72e0a44f1581164ad809} gain last year, according to the Consumer Technology Association’s forecast released ahead of the CES tech trade show opening Wednesday in Las Vegas.

  • Tech sales soared during the pandemic when people worked and attended classes from home, and more companies increased their digital commerce. The CTA sees software and services growth slowing to 6{cfdf3f5372635aeb15fd3e2aecc7cb5d7150695e02bd72e0a44f1581164ad809} in 2022, from 11.4{cfdf3f5372635aeb15fd3e2aecc7cb5d7150695e02bd72e0a44f1581164ad809} in 2021. Hardware growth will trickle to 1.8{cfdf3f5372635aeb15fd3e2aecc7cb5d7150695e02bd72e0a44f1581164ad809}, down from last year’s 9{cfdf3f5372635aeb15fd3e2aecc7cb5d7150695e02bd72e0a44f1581164ad809}.

  • Steve Koenig, CTA’s vice president for research, noted that the hardware business is being hampered by higher shipping costs and semiconductor shortages, with average lead times for semiconductors stretching to 22 weeks in late 2021, compared with less than 12 weeks in 2020.

  • Electric and autonomous cars, trucks, bikes, and boats headline this year’s show, including


    Deere’s     autonomous tractor with an attached tillage implement. Julian Sanchez, Deere’s director of emerging technologies, told Barron’s that tillage is a labor-intensive process to prepare the soil for next year’s planting.

  • Deere said its tractor can run “fully driverless” around the clock, with six stereo cameras to detect holes, debris, and other obstacles, and could improve productivity by as much as 20{cfdf3f5372635aeb15fd3e2aecc7cb5d7150695e02bd72e0a44f1581164ad809}. Deere wants to design its tractor to perform tasks such as planting and spreading herbicides.

What’s Next: Koenig said the real solution to the global chip shortage is new manufacturing facilities planned by


Intel,


Samsung Electronics,


Taiwan Semiconductor and others, which will reduce reliance on chips from East Asia. But those are all still several years away.

—Eric J. Savitz and Janet H. Cho

***

‘Help Wanted’ Drops Most in Food Service and Accommodation

The food service and accommodation industry made up the biggest decline in job openings in November, dropping to 1.3 million openings from 1.6 million a month earlier, according to Bureau of Labor Statistics data released Tuesday. Overall, job openings dropped to 10.6 million from 11.1 million in October.

  • About 4.5 million people quit their jobs in November, a record quit rate of 3{cfdf3f5372635aeb15fd3e2aecc7cb5d7150695e02bd72e0a44f1581164ad809}. The November Job Openings and Labor Turnover Survey doesn’t include the effects of the Omicron coronavirus variant, which began spreading in December and comprised an estimated 95.4{cfdf3f5372635aeb15fd3e2aecc7cb5d7150695e02bd72e0a44f1581164ad809} of cases by Jan. 1.

  • Daniel Zhao, senior economist at careers website Glassdoor, told MarketWatch the slowdown in job openings is “a natural response to the pandemic worsening as employers hesitate to go full force on hiring” until conditions improve. Employers are “desperate” to keep their workers.

  • One


    McDonald’s     franchisee in Altamont, Ill., northeast of St. Louis, is offering free iPhones to new hires who stay at least six months, with a sign in the window saying: “Now Hiring. Free iPhone.”


    Chipotle     and


    Yum! Brands    ’ Taco Bell are offering cash bonuses, raises and tuition benefits.

  • Leisure and hospitality also raised their average hourly pay by 12.6{cfdf3f5372635aeb15fd3e2aecc7cb5d7150695e02bd72e0a44f1581164ad809} year-over-year. Demand for leisure and hospitality workers remains strong, but jobs have declined from a peak of 1.9 million in July 2021, wrote Nick Bunker, director of economic research at Indeed Hiring Lab.

What’s Next: On Friday, the Labor Department reports December employment figures, including nonfarm payrolls, labor-force participation rate, and the unemployment rate. Economists will be looking for corroboration that labor demand has cooled.

—Lisa Beilfuss and Janet H. Cho

***

KFC to Offer Beyond Meat’s Plant-Based Fried Chicken

KFC will start selling fake chicken made by Beyond Meat in its restaurants nationally next Monday, for a limited time until supplies run out, the two companies announced, calling it a “Kentucky Fried Miracle.”

  • The Yum! Brands company has been testing plant-based chicken products in its restaurants since 2019, in locations such as Atlanta, Nashville, and Charlotte. It also tested the plant-based fried chicken in Southern California in 2020, selling out in a week.

  • Beyond Meat stock soared 9{cfdf3f5372635aeb15fd3e2aecc7cb5d7150695e02bd72e0a44f1581164ad809} on Tuesday after word of the offering. The two companies made an agreement a year ago where Beyond would make meat substitutes for KFC, Taco Bell, and Pizza Hut.

  • The two are counting on a number of people choosing to eat more plant-based food in the New Year. Mexican food chain Chipotle unveiled its plant-based chorizo sausage on Monday.

  • Beyond Meat had initial success in grocery stores and then faltered. Its shares are down 50{cfdf3f5372635aeb15fd3e2aecc7cb5d7150695e02bd72e0a44f1581164ad809} in the past year, and the company reported disappointing third-quarter results, with a gloomy sales outlook.

What’s Next: McDonald’s has been testing a plant-based burger called McPlant in eight locations and is expected to expand the rollout this year, possibly by the end of the first quarter, as a limited time offer.

—Liz Moyer

***

First Signals Emerge That Inflation Might Near Peak

Data released this week seem to indicate inflation might be nearing its peak in Western economies.

  • The Institute for Supply Management’s composite index, a key U.S. business survey, stood at 58.7 in December, falling short of expectations but showing a continued expansion for U.S. factories.

  • The data also showed that manufacturers’ input prices and supplier delivery delays declined month on month. That was “the biggest monthly drop in the prices paid measure in over a decade, and leaves it at its lowest level since November 2020,” Deutsche Bank analysts wrote.

  • The same trend is at work at the global level, with the JPMorgan global manufacturing purchasing managers index also indicating that supply-chain bottlenecks seem to be fading, even though they haven’t disappeared.

  • The minutes of the last Federal Reserve meeting, to be released later Wednesday, will give an idea of how fast and strong the U.S. central bank intends to keep tightening its policy to tame inflation, which it no longer sees as “transitory.”

What’s Next: Prices keep rising, but maybe at a slower pace than in the past few months, prompting France’s top central banker to declare that inflation is now “close to its peak,” after data showed December inflation stable compared with November.

—Pierre Briançon

***

Dear Quentin,

I grew up thinking we were the perfect family. My parents were married for 60 years, and my siblings have always been very close. My mom passed away a few years ago. For fun, we all took one of those DNA tests and, shockingly, I found out that I was the product of an affair.

While I haven’t been able to confirm 100{cfdf3f5372635aeb15fd3e2aecc7cb5d7150695e02bd72e0a44f1581164ad809}, I have a good idea of who my biological dad is through some mutual relatives and friends. I do remember him and his family. Here’s the kicker, he won’t discuss anything with me.

In fact, his first question was, “What do you want?” Honestly, I really wanted answers. I can’t get them from mom and don’t want to break my father’s heart. I don’t know if he knows or not. He’s elderly and not well.

While my father—the one I’ve only known to raise me—is alive, I don’t know if I want a relationship with my half siblings or not. It’s all very overwhelming. However, my biological father is also elderly and in poor health.

My siblings have counseled me to consider what I may be entitled to as an inheritance as this man is actually very well off, and always has been. Ironically, my parents purchased a home from him and his wife many years ago.

I don’t even know what I may be entitled to, whether I want it or not, whether I want any relationships, etc. Can you help guide me on the financial side of this affair?

—Confused

Read The Moneyist’s response here.

—Quentin Fottrell

***

—Newsletter edited by Liz Moyer, Camilla Imperiali, Steve Goldstein, Rupert Steiner

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Sanjiv Bhasin | Auto stocks to buy: 5 must-buy stocks in auto sector now: Sanjiv Bhasin

“This is the time to place your revenue the place your mouth is. I would undoubtedly be searching at a ton of the banks, industrials and outperformance from below onwards for India is on the playing cards in 2022. Equities will outperform all asset lessons at least for the upcoming two many years,” claims Sanjiv Bhasin, Director, IIFL Securities.

Heading into 2022 right after a 30{cfdf3f5372635aeb15fd3e2aecc7cb5d7150695e02bd72e0a44f1581164ad809} up transfer in the Nifty, are triggers however positioned for a far better go in advance?
You explained 30{cfdf3f5372635aeb15fd3e2aecc7cb5d7150695e02bd72e0a44f1581164ad809} up but you have not found a 7{cfdf3f5372635aeb15fd3e2aecc7cb5d7150695e02bd72e0a44f1581164ad809} slide which has been very, really hurting in the previous one particular thirty day period. This is the lull before the storm. The FTSE and the Dow Jones are hitting new highs as the range of Omicron variant infected hit new highs but the quantities are slipping pretty sharply also. In India, in the next two months, we will see significant figures but this could be the end of the pandemic and it may well direct to an endemic stage. So I am exceptionally bullish searching at new highs just before the Price range. This is the time to place your cash the place your mouth is. I would definitely be hunting at a large amount of the banking institutions, industrials and outperformance from right here onwards for India is on the cards in 2022.

Ought to just one reduce return anticipations even while the direction may possibly be larger?
We are in the most effective of the bull marketplace, the likes of which we have in no way witnessed.I think the next three yrs will be a bull market. Of program, a single simply cannot have the tempo which we saw previous 12 months and there will be bouts of profit scheduling or income chasing and other alpha but a person has to be stock precise and 1 of our particulars would be the financial institutions. They have been hit for no cause. Weaker sectors like energy, metal, cement have all outperformed. So NPAs are at a document very low and are likely to be there. Price tag of funds is the lowest and the arrival of retail investing can be a set off.



The next sector would be autos which have been strike by the chip scarcity. We are not looking at the index offering 30{cfdf3f5372635aeb15fd3e2aecc7cb5d7150695e02bd72e0a44f1581164ad809}, 20{cfdf3f5372635aeb15fd3e2aecc7cb5d7150695e02bd72e0a44f1581164ad809} from below it’s possible on the playing cards but I would say that equities are in a really sweet spot for the following two-a few several years. Do not undermine a very little bit of tapering or inflation going high due to the fact that is a sign of progress. Equities will outperform all asset lessons at least for the next two years.

In the scenario of the vehicle sector, we are observing disruption with the EV forays. Now Bajaj Automobile is getting into EVs as effectively and location up a new plant at Pune. Wherever do you stand in the two-wheeler space right now?
That will be a element we are not heading to see the ICE go absent and simply because of a pretty strong retail comeback, 2022 will mark the comeback of the retail two wheeler current market since there are elections, a minimal price of money and a fantastic output on the farmer entrance. It will all outcome in getting. Hero Moto has invested in Ather. Ather is an unlisted inventory but it has more income than even Ola on the scooter entrance. Bajaj Vehicle is obtaining into it. So EV is a very attention-grabbing place and 2022 will belong to that.

I would counsel two OEMs which will be critical – one would be

which will cater to equally the EV and the ICE and the second a person would be Amara Raja. It is acquiring into a pretty huge foray with a Norwegian corporation which is the sector chief as significantly as batteries and EVs go. Lithium ion battery is a duopoly of Amara Raja and Exide. So I am really thrilled about Amara Raja. I imagine that could be a large outperformer.

We favor TVS, Bajaj Vehicle and Hero in that order and this is the time for obtaining these shares mainly because as soon as their income start out to pick up thanks to weddings, the farmer starting up to invest, we will see the two-wheelers choose off perfectly. So TVS, Bajaj and Hero in that get but the best picks are Amara Raja and Motherson Sumi.

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New York City to mandate Covid vaccines for all private sector workers

This new move, which de Blasio announced Monday on MSNBC, means everyone who works in the city will now be subject to a vaccine mandate.

“The more universal they are, the more likely employees will say okay, it’s time. I’m going to do this. Because you can’t jump from one industry to another or one company to another,” de Blasio said. “It’s something that needs to be universal to protect all of us.”

At a press conference later on Monday, de Blasio said the vaccine mandate is the best way to avoid a return to a shutdown of businesses and other public events that other countries have ordered as Covid cases continue to rise.

“We need to take very bold action. We’re seeing restrictions starting to come back. We’re seeing shutdowns,” he said. “We can not let those restrictions come back. We can not have shutdowns in New York.”

Details about the how the rules will apply to businesses are due to be announced December 15, and de Blasio said the city will be holding discussions with businesses between now and then about those rules. The rules will not allow employees to opt out of vaccination through regular testing, as a proposed federal mandate for employers with 100 or more workers will do. And it will require workers to have at least one vaccination dose by the December 27 deadline.

The penalty that will be imposed on businesses that do not enforce the mandate were not disclosed.

“It is part of life that there have to be some consequences,” de Blasio said. “We’ll figure out what makes sense between now and December 15.”

The mayor said that the overwhelming majority of businesses have complied with an earlier city rule requiring customers to show proof of vaccination, including at the city’s restaurants, health clubs and entertainment venues. “It’s been amazing, [there have been] very few times we actually had to penalize people,” the mayor said.

De Blasio said the need for the new rules is a triple threat that is raising the potential for additional cases — the emergence of the Omicron variant, the coming of cold weather forcing people to congregate be inside more frequently, and the expectation of holiday gatherings in the weeks ahead.

The mandate itself will begin only four days before the end of de Blasio’s eight-year term in office. He told reporters that he had spoken to Mayor-elect Eric Adams, who is currently traveling outside the country. Although he said he would not speak for Adams, he’s confident that the new mayor wants to follow the advice of medical professionals and keep the vaccine mandate in place once he takes office.

“In every conversation we’ve had about fighting Covid, he’s been really consistent on the point that he is feeling urgency, about these new threats, and that he understands my job is to keep New Yorkers safe until Dec. 31,” he said. “I feel very, very good about the conversations we’ve had.”

And he said that the medical professionals he has spoken to are united in the need to increase the rate of vaccination, and their belief that a vaccine mandate will work to do that.

Children, ages 5 – 11 in New York will now also be required to show proof of at least one shot before being allowed access to indoor dining, fitness or entertainment, the mayor announced.

Adults will now be required to show proof of two vaccinations for those areas.

The mayor is confident the mandates will hold up in court.

“Our health commissioner has put a series of mandates in place. They have won in court, state court, federal court every single time. And it’s because they’re universal and consistent. And they’re about protecting the public right now from a clear and present danger,” de Blasio said.

City employees were already subject to vaccine mandates. But a federal mandate for businesses with 100 or more employees to require vaccines or weekly testing of its employees is on hold due to court challenges. Many major employers, including some Wall Street banks and tech companies with offices in the city, have their own vaccine mandates in place.

Surprise announcement

The announcement caught business leaders off guard.

“We had no heads up,” Kathryn Wylde, president and CEO of the Partnership for New York City, an influential business group, told CNN Monday in a phone interview.

Wylde said she was “surprised” to learn about the new health restrictions through the media because typically local leaders would give the business community a heads up about such a shift.

“It’s unclear if the city has authority to issue such a mandate,” Wylde said, adding that the city business leaders are “very supportive” of vaccines.

Although New York employers are not against vaccine mandates, Wylde said business leaders are looking for more information on how this new order will be enforced and whether employees can opt out through testing. City workers already faced such a mandate.

“Employers do not want to be enforcement agents,” Wylde said.

But the head of the Greater New York Chamber of Commerce praised the move.

“I don’t think it’s going to be an issue when it comes to private companies. Most of them are already vaccinated and require it,” said Helena Natt, executive director of the Greater New York Chamber of Commerce.

Natt said the move by the city is a “next step” in what needs to be done.

“We’re monitoring Covid, Delta, now we’re monitoring Omicron,” she said. “We’re watching the science and if the people of New York can watch to make sure they can do everything in their power to make sure [they] are safe and coworkers are safe.”

Biden's vaccine mandate is on hold, but companies are moving ahead anyway

Business leaders are also concerned about navigating the maze of federal, state and city health policies. For instance, unlike the city, New York State does not have a vaccine mandate for private employers. And the Biden administration’s vaccine mandate for employers with 100 or more workers has been held up by court challenges.

Wylde said there is concern over a lack of coordination for federal, state and city health policies. “Public health protocols generally, and vaccine mandates, should be coordinated and consistent with each other,” Wylde said.

But de Blasio said that the businesses he spoke to about Covid were supportive of a mandate.

“I’ve heard from so many business leaders, including in those sectors, like finance and tech, that the best thing for them is for government to lead the way,” he said. “It’s always better for the private sector if the government sets a single, universal standard, so they don’t have to … say to their employees, ‘Hey, this is something we’re going to do on our own.'”

He said what they really don’t want to see is the kind of spike in cases that requires a shutdown or stay-at-home orders now being put in place in parts of Europe.

“Our health care leadership was adamant that this was a step we could and must take,” he said. “We know from extensive conversations over months with private sector employers what their concerns are. The number one thing I’ve heard … is that we must avert shutdowns.”

— CNN’s Vanessa Yurkevich contributed to this report