“There is no long-term future for cars with an internal combustion engine … we are firmly committed to becoming an electric-only car maker. It will allow us to meet the expectations of our customers and be a part of the solution when it comes to fighting climate change.”
Volvo’s Chief Technology Officer Henrik Green made one of the strongest statements by a car executive yet that the days of petrol motoring are coming to an end. The Swedish car brand has announced plans to go fully electric across its whole range by the end of the decade.
While Volvo currently has only one EV model on commercial sale, the Chinese-owned company unveiled a second, smaller cross-over version of its flagship XC40 model at Tuesday’s event in Stockholm.
Motoring experts say the announcement puts Volvo in a head-to-head fight with market leader Tesla, as the age of pure-electric motoring approaches.
How do Volvo’s rivals’ EV conversion plans compare? See our graph.
Elsewhere, amid angry protests outside stores in Madrid, Spain’s Inditex group, the parent of the Zara fashion chain, is accused by workers of reneging on agreements with unions to redeploy workers facing redundancy amid a post COVID-19 shake-up.
Meanwhile, ahead of tomorrow’s budget in the UK, chief finance minister Rishi Sunak is under pressure to take measures that will restore London’s crown as Europe’s top share trading hub. City grandees are said to be concerned over recent figures that show it is losing out to rivals Amsterdam and Dublin.
And are Britons going to spend, spend, spend when lockdown is over? Many retailers battered by COVID-19 are certainly hoping so. Figures show the amount of cash on deposit at the UK’s “Big Four” banks has ballooned in lockdown, leaving lenders with a glut of liquidity. A nice problem to have?
Read on for more on this and the rest of the day’s business news in full.
Digital business correspondent
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Swedish car giant Volvo says it will sell only electric cars by the end of the decade. While announcing plans for a radical revamp of its sales operation, the auto maker says it will phase out all of its models with internal combustion engines including hybrids by 2030 and move sales online, cutting out dealerships.
Amid plans to accelerate a green agenda for the flagship Nordic brand, the auto maker, owned by China’s Zhejiang Geely Holding Group, says in future vehicles will be sold under a centralized system, in which showrooms are kept as picking-up points or for servicing existing cars in use. Volvo also says it plans to expand its leasing and insurance business.
The announcement comes just weeks after UK’s Jaguar Land Rover (JLR) said it planned to go electric-only by 2025 in a major shift for the firm, while U.S. giant Ford has also accelerated its EV plans in recent weeks, saying it plans to sell electric-only passenger cars in Europe from 2030.
The UK’s chief finance minister Rishi Sunak is expected to launch plans to attract more firms to list on the London stock markets when he releases his annual budget on Wednesday. Measures are said to include a relaxation of the rules on company flotations and the use of dual-class shares, which would allow firms to list on the London markets while still retaining greater control of their businesses. Sunak is under pressure to further liberalize the UK’s financial sector post Brexit, with some industry figures voicing alarm when Amsterdam recently surpassed London to become Europe’s largest share trading centre
Meanwhile, a report just out says Dublin is now the top spot in Europe for financial firms looking to leave London post Brexit. The consultancy EY says three dozen top financial firms have already moved part of their UK operation to the Irish capital or are considering doing so. Ireland’s plans to attract more global financial firms, partly through a low corporate tax offer, are growing in the post-Brexit era. While on mainland Europe, Luxembourg and Frankfurt are also seeing a rise in interest from British firms seeking new EU locations.
Workers at the Spanish fashion titan Zara claim management is reneging on a deal with unions to protect jobs as the firms seeks to close the first of 700 stores across Europe. Last summer, Inditex, the parent company of Zara, announced plans to close up to 1,200 stores worldwide amid falling sales and the impact of COVID-19. Unions claim a deal made in December to match all staff facing redundancies with available vacancies close to where they used to work is failing. Inditex has just been knocked off the top spot as the world’s biggest clothing retailer by valuation to Japan’s Uniqlo owner Fast Retailing.
Online fashion retailer Boohoo says it is not aware of any investigation into its business practices by authorities in the U.S. after reports that a campaign group had reported the firm to the U.S. Customs and Border Protection Agency. The group Liberty Shared says Boohoo has not done enough to improve working standards at it factories in Leicester, which it claims amount to slave labor. In a stock market statement, Manchester-based Boohoo said: “The group is confident in the actions it is taking to ensure that all of its products meet the CBP criteria.”
The jobless rate in the EU’s biggest economy rose unexpectedly last month. The total number of unemployed people in Germany now stands at 2.75 million, a rate of 6 percent, according to the Federal Labor Agency, while economists had predicted a slight fall. More than 2 million workers in Germany are currency on furlough, with the country in lockdown since the middle of November. Spain also saw its joblessness rise last month, up 44,000 in February, according to data from the EU’s statistics agency Eurostat. The number of people out of work in the EU’s fifth biggest economy is now at its highest rate since 2016.
Revenues in video conferencing firm Zoom rose to $883 million in the three months to the end of January. That is up from $188 million the year before and well ahead of analysts’ expectations. Shares rose 10 percent in after-market trading on Monday, valuing the company at $131 billion. Despite the anticipated end of lockdown conditions in key markets this year, boss Eric Yuan is predicting revenues to grow as much as 43 percent over the next year, stating: “The future is here with the rise of remote and work-from-anywhere trends.”
Italian flag carrier Alitalia is set to relaunch as a smaller operation with less than half the state support it had hoped for, according to reports in the national press. Italy’s La Repubblica newspaper says Alitalia, which has been run by state-appointed administrators since declaring bankruptcy in 2017, will go into service with 45 planes and around $1.2 billion in state funding at the end of April, renamed ITA, in a deal that has yet to be approved by EU regulators.
China was the biggest source of applications for international patents globally last year, according to a report by the World Intellectual Property Organization (WIPO). International patent applications via WIPO continued to boom despite the COVID-19 pandemic impact, the report said.
North China’s Inner Mongolia region is considering ending all cryptocurrency mining projects in a bid to meet energy efficiency targets. A draft ruling last week, currently open for consultation, says the northern provincial region plans to cut the amount of energy consumed per unit of GDP by 3 percent this year. As well as steel, coke and methanol production, the planned rules would set limits on cryptocurrency mining.
Australian cosmetics brand Becca is to close, blaming the impact of the COVID-19 pandemic on sales. Becca cosmetics was bought by industry giant Estée Lauder in November 2016 after years of “exceptional growth,” particularly in the black and minority ethnic (BME) market. In an online statement the Perth-based firm said “the global impact of COVID-19, has been more than its business can withstand.”
E-commerce giant eBay and Norway’s Adevinta are to sell three smaller British units in order to get regulatory approval for the planned tie-up of their global classified advertising businesses. Last month, the UK’s regulator the Competition and Markets Authority raised concerns over the impact of the $9.2 billion deal on the classified ads market. Now Adevinta and eBay say they will sell their primary operations in Britain; Shpock, Gumtree and Motors.co.uk. Under the terms of the deal struck last July, Adevinta will acquire eBay’s classified ads business in return for $2.5 billion in a cash-and-shares deal that will make eBay Adevinta’s largest shareholder.
Saudia, formerly known as Saudi Arabian Airlines, is reportedly in talks to order 70 airliners from Airbus and Boeing. The planned delivery of the Airbus A321 narrow-bodied jets and Boeing 777 and 787 Dreamliner wide-bodied planes is dependent on the carrier securing $3.07 billion in funding from local lenders.
Online grocer Flipkart plans to expand its operation in India with 70 new locations added to the 50 already open. The Bengaluru-based firm, now owned by the U.S. giant Walmart, says demand has grown “exponentially” in the COVID-19 lockdown, with many Indians turning to online shopping for the first time.
And the UK’s “Big Four” banks gained $277.52 billion of new deposits last year as customers stayed home during the COVID-19 pandemic lockdown. Analysts say, despite poor economic data, UK lenders have fared the pandemic well and now have a glut of savings, as the sums on deposit far outstrip the extra cash lent to struggling businesses and households.
WATCH: It makes you cold just watching him! Czech freediver David Vencl has brrrr-oken the world record for swimming under ice.
Global stocks have rallied again and bond markets stabilized following a sell-off of government debt last week. Despite that, concerns remain that global inflation may spiral on massive government spending and pent-up demand post the COVID-19 pandemic. CGTN Europe was joined by Jasmine Birtles from the financial website MoneyMagpie.com for analysis.
A certain amount of inflation is a healthy sign and the Bank of England, together with other banks around the world, other central governments, are looking for around a 2 percent inflation rate. Something around that amount is a nice, healthy number at the moment.
Inflation in this country has risen to 0.7 percent. That’s still pretty low. But yes, the fact that it has actually risen a bit has put a little bit of a warning in people’s thoughts. There have been concerns growing over the last few months, particularly during the lockdown, that there’s been a lot of money printing, quantitative easing, going on very much in America, certainly in this country, in Britain and certainly in Europe.
In America, we’ve heard it’s over $2 trillion that Biden has said that they’re going to inject into the economy. And when that happens, when you have that level of quantitative easing, that amount of money sloshing around the economy, the idea of it is to get people to spend. And of course, when people spend that tends to push prices up.
There was this big global sell-off on Friday. Are we going to see more of that?
We may do. I think it’s going to be a bumpy ride this year in terms both of bonds and also of equities, because still nobody really knows what’s happening. It’s different in different countries, of course, but gradually the West is starting to come out of lockdown. At some point people are going to be able to spend again.
Really, over the last year, spending has been very patchy, there has been hardly any spending on travel, very little on clothes, you know, hospitality, all of those the sort of things that we normally spend on. Much of it has been suppressed. Now, when things open, we think but we don’t know, that quite a lot of people will go out and spend. There’s a pent-up demand. So that should push inflation.
And finally, Volvo is the latest car giant to commit to fully electric vehicles in the coming decade. How do its major rivals’ plans for a petrol-free future compare?