6:50 am, November 8, 2024
Bank of England cuts interest rates as borrowing costs to fall ‘gradually’
UK interest rates have been cut for the second time this year, as the Bank of England forecast a ‘gradual’ reduction in borrowing costs despite uncertainty following the autumn Budget.
The Bank’s Monetary Policy Committee (MPC) announced that rates were being reduced from 5% to 4.75% on Thursday.
Governor Andrew Bailey said UK inflation falling below its 2% target meant policymakers had been able to cut rates to the lowest level since June last year.
Consumer watchdog urges Government to tackle barriers to heat pumps and EVs
The Government must do more to tackle cost and other barriers discouraging consumers from switching to heat pumps and electric vehicles, Which? has said.
The consumer watchdog’s annual survey, now in its third year, tracks shoppers’ attitudes towards sustainability.
Respondents identified a range of deterrents putting them off greener home heating and cars – such as cost, low awareness, insufficient information and concerns about availability and reliability.
Rolls-Royce says supply chain ‘challenging’ but sales remain on track
Engineering giant Rolls-Royce has said supply chain conditions remain ‘challenging’ but sales are on track amid its transformation programme.
The company said it has been supported by strong demand in its civil aerospace business. It said flying hours in this division grew by 18% for the 10 months to October compared with the same period a year earlier.
Rolls-Royce said it was therefore still on track to meet its financial forecasts, expecting operating profits of between £2.1bn and £2.3bn for this year.
Fuel prices remain at three-year low in October despite ‘brief spike’ in oil costs – RAC
Fuel prices remain at a three-year low despite a ‘brief spike’ in the cost of oil early in October.
That’s according to data from RAC Fuel Watch, which has found that the average price of petrol stands at 135.2p – up a third of a pence on September’s figures. As a result, the cost of filling up an average 55-litre car with unleaded is now £74.40.
Diesel, meanwhile, increased in price by two-thirds of a pence to 140.2p a litre, resulting in a £77 fill-up for an average family car. However, the RAC states that UK diesel prices are the most expensive in Europe, continuing a theme that has been the case ‘for 21 of the last 27 weeks’.
Thursday on Car Dealer
Close Brothers starts underwriting new finance business again as industry recovers from chaos
Close Brothers Motor Finance has resumed offering new motor finance following a two-week suspension caused by an unexpected Court of Appeal ruling. This judgment, favouring consumers in a case on commission disclosure, prompted Close Brothers and several other lenders, including Honda and MotoNovo, to halt new finance deals, leading to widespread industry uncertainty. Now returning in phases, Close Brothers initially resumed business with select partners on November 2, with plans to expand fully to third-party partnerships. CEO Seán Kemple acknowledged the industry’s rapid adjustments to the ruling, thanking staff and partners for their efforts to adapt swiftly.
Bentley pushes back electric-only plans even further with date now delayed to 2035
Bentley has delayed its transition to an electric-only brand from 2030 to 2035, revising its “Beyond 100” strategy. The Crewe-based luxury automaker plans to continue offering hybrids, including new versions of the Flying Spur and Continental GT, with a fully electric model—a smaller SUV than the current Bentayga—slated for 2026. CEO Frank-Steffen Walliser attributes this shift to changing legislation, customer demand, and evolving infrastructure. Bentley will also introduce a new internal combustion model in 2024, supported by an emphasis on sustainable fuels to extend the viability of petrol engines amid tightening regulations.
Nissan cuts profit forecast by 70% and announces 9,000 jobs to go globally
Nissan is cutting 9,000 jobs worldwide and reducing production capacity by 20%, aiming to save $2.6 billion (£2bn) amid falling profits and a 70% decrease in forecasted operating profit to 150 billion yen (£754m). The changes, which account for almost 7% of Nissan’s global workforce, leave the future uncertain for UK employees at the Sunderland plant, where models like the Qashqai and Juke are produced. The company will also divest up to 10% of its Mitsubishi Motors stake and reduce vehicle development time to 30 months to streamline operations. Facing heightened competition in China’s EV market and a limited hybrid lineup in the US., Nissan plans to collaborate more closely with Renault and Mitsubishi to navigate these challenges.
Auto Trader Group sees boost in revenue and profits despite Autorama losses
Auto Trader Group reported strong first-half results, with revenue rising 8% to £302.5m and operating profit up 14%. Auto Trader’s core business grew by 9%, driven by increased dealer revenue, although market dynamics limited revenue per retailer growth. Despite Autorama continuing to post losses, they narrowed to £2.8m from £5.6m a year earlier. CEO Nathan Coe credited strategic partnerships, recent AI initiatives, and a strong marketing push for these gains, while cautioning about market uncertainties affecting the industry.
What does Donald Trump’s election win mean for automotive industry in Europe and beyond?
European carmakers saw significant share declines following Donald Trump’s election as US president. BMW’s shares fell by 6.6%, Mercedes-Benz by 6.4%, Porsche by 4.9%, and Volkswagen by 4.3%, as investors worried about the potential for new US tariffs on imported vehicles. Trump’s protectionist stance and support for US.-based manufacturing could impact European manufacturers, especially those with major exports to the US. The UK government, along with the Society of Motor Manufacturers and Traders (SMMT), has pledged to advocate for free trade to support British automotive jobs. Conversely, shares of U.S. automakers like Ford and GM rose in pre-market trading, as investors expected benefits from potential tax cuts and less stringent emissions regulations under the Trump administration.
How leading automotive dealers are using call tracking data to drive more car sales
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Minister: Trump led ‘fiery’ campaign, let’s ‘wait to see what he does’ on trade
Donald Trump said ‘a lot of fiery things’ in his campaign for the White House, Cabinet Office minister Pat McFadden said as he urged the public to “wait to see what he actually does” amid fears of a trade war.
Mr McFadden also defended comments made about Mr Trump by his Cabinet colleagues, as shadow chancellor Mel Stride reiterated the Tories’ call for the Government to apologise to the president-elect.
Sir Keir Starmer said it was ‘good to speak’ with Mr Trump in a phone call on Wednesday evening in which the Prime Minister congratulated him on his ‘historic victory’.
BT slashes sales outlook and axes another 2,000 jobs in ongoing overhaul
Telecoms giant BT has cut its annual sales outlook and revealed another 2,000 jobs have gone under its ongoing plan to slash costs.
The group reported a 10% drop in pre-tax profits to £967m for the six months to September 30 as revenues fell 3% to £10.1bn amid a ‘competitive retail environment’.
It now expects annual revenues to fall by 1% to 2%, blaming trading outside the UK and reductions to sales of less profitable kits, while it also flagged a weaker performance in the corporate and public sector.
The markets
The pound regained some of this week’s losses against the dollar after the Bank of England signalled a cautious approach to cutting interest rates.
Sterling rose 0.77% to 1.2982 dollars on Thursday afternoon, following the Bank’s announcement that it would cut rates by a quarter point to 4.75%.
The FTSE 100 fell 5.71 points, or 0.07%, to end the day at 8166.68. At the end of the day in Europe, Frankfurt’s Dax index was up 1.72%, while the Cac 40 in Paris had closed up 0.76%.
Weather outlook…
Today will see predominantly dry and sunny conditions, with temperatures around 10-13°C.
High-pressure conditions will bring clearer skies, while some areas may experience patchy morning fog that clears by midday.
The east may remain cloudy, but overall, conditions will be mild with light winds.
