With its glitzy car launches, shiny supercars, and show-stopping sound and light shows, it’s easy to see why the great and good, or perhaps the fast and the furious of the global auto industry see a trip to Switzerland and the Geneva International Motor Show as an absolute annual must.
This year, as the event prepares to get underway tomorrow, it’s clear that things feel – and look – very different, with the spectre of Brexit and its effects on the European car industry’s “just-in-time” production system looming large.
Conspicuous by their absence are Jaguar Land Rover, Volvo, Vauxhall and Ford. Empty stands for Jaguar Land Rover and Vauxhall are a strong sign of the difficult state of British car making which, among other things, has seen Honda close its factory in Swindon with the loss of 3,500 jobs.
For Jaguar Land Rover, last year’s event, which they used as a high-profile platform to unveil the fastest and most expensive Range Rover in history, must be an uncomfortable memory. The company has since cut jobs, put factories on three-day weeks and ordered temporary production shutdowns. With £2.5 billion of cost savings to find, a jaunt to Europe’s biggest motor show had to go.
That’s not to say it’ll be a smooth ride for the carmakers who have made the trip to the Swiss city. The uncertainty over Brexit casts a long and dark shadow, and the introduction of a possible delay to the UK’s exit has added a further layer of complication to an industry that was putting in place arrangements to cope with a no-deal outcome.
Andy Palmer, the chief executive of Aston Martin, has said the British sports car maker will spend up to £30 million pounds on preparing for a potentially disorderly Brexit, including stocking more components and potentially flying in parts if ports are congested.
Expect to still see the usual blend of speed, style and ground-breaking innovation on display in Geneva. However, a slowdown in China, a plunge in demand for diesel vehicles, the costly investments being made in electric vehicles, and last but not least, Brexit are all putting the brakes on Britain’s once booming car industry returning to top gear.
Sajid Javid, the home secretary, has said that knife crime “can’t go on” after the murders of a 17-year-old girl in east London and a boy, also aged 17, in Greater Manchester at the weekend. Javid will meet with police chiefs on Wednesday as he looks to tackle a rise in the number of teenagers being stabbed to death across the UK.
Theresa May has been accused of trying to buy the support of Labour MPs for her Brexit deal after she announced a £1.6 billion fund for struggling communities. The PM’s Stronger Towns Fund has attracted criticism from Conservatives who feel the money will mainly benefit Labour-held constituencies, while the opposition front bench accused her of attempted bribery as she looks to secure the support she needs for her Brexit plan to pass through the Commons. (£)
Israel’s governing party has suffered its worst slump in the polls for four yearsas its leader, prime minister Binyamin Netanyahu, faces corruption charges. The latest poll shows the Likud party has fallen six-points behind Blue and White, the new centrist party led by Benny Gantz, the popular former chief of staff of Israel’s army. The prime minister has until April 9 to regain the lead or face the prospect of being unable to form a coalition to back his fifth government after the election. (£)
BUSINESS & ECONOMY
Ray Kelvin, founder and chief executive of fashion chain Ted Baker, has resigned from his position following allegations of misconduct. Kelvin has been on a voluntary leave of absence since December after employees launched an online petition accusing him of inappropriate comments and behaviour, including “forced hugging”.
Maurice Tulloch has been appointed as the new chief executive of Aviva, replacing Mark Wilson, who was ousted in October after a disagreement with the board over strategy. Tulloch has been with the insurer for a number of years, most recently running its international business. (£)
Philip Hammond has promised to increase public spending when he delivers his spring statement next week if MPs agree to back the government’s Brexit agreement. Back in October, Hammond had said that he had £15.4bn of room for manoeuvre, but warned that some of that money might be required to prop up the economy in the event of a disorderly no-deal exit. (£)
The week ahead
Economists expect to see a growth of about six per cent when Chinese premier Li Keqiang announces the government’s 2019 economic growth target. If this prediction holds true, it would be a small decrease from last year, when growth was 6.5%. Li Keqiang will also outline the government’s five-year development plan when he addresses the National People’s Congress in Beijing, which comes amid the country’s trade war with the US.
This week will see a number of central banks set rates as they grapple with various issues in their respective economies. European Central Bank is widely expected to keep key rates on hold when they meet on Thursday as they aim to protect the economy from a protracted slowdown. The Reserve Bank of Australia (Tues) and the Bank of Canada (Weds) also set rates this week, as does Turkey’s central bank (Weds), while the Bank of England will publish minutes from the most recent policy meeting.
On the corporate announcements front, insurers Aviva, Admiral and Legal & General all report this week.
Johnson Service Group
Litigation Capital Management Limited (DI)
IG Seismic Services GDR (Reg S)
UK Economic Announcements
(09:30) PMI Construction
Int. Economic Announcements
(10:00) Producer Price Index (EU)
(15:00) Construction Spending (US)
COLUMNS OF NOTE
The FT’s Big Read analyses a possible merger between Deutsche and Commerzbank and explains why, after a decade, the move to combine Germany’s two largest banks now has political backing.
In The Sunday Times, Kevin Pringle asks what, if anything, the newly formed Independent Group has to say about Britain’s constitutional affairs after the 11-strong group did not appoint a spokesperson for Scotland, Wales or Northern Ireland. Pringle says that if the group is to revive centre politics in Scotland, a bold approach would be to bring back Scottish Liberal Party as “an autonomous force of the radical centre”. (£)
DID YOU KNOW?
The tsunami in Japan in 2011 moved the country four metres to the east, and shortened the length of a day by 1.8 millionths of a second.
House of Commons
Housing, Communities and Local Government (including Topical Questions)
Financial Services (Implementation of Legislation) Bill [Lords] - Remaining stages
Draft Social Security Benefits Up-rating Order 2019
House of Lords
Sustainable funding for specialist domestic abuse services - Baroness Healy of Primrose Hill
Impact of Brexit on national museum and galleries - Lord Lee of Trafford
Action to uphold women's rights around the world, in light of the second global SheDecides Day - Lord Oates
Access to medicinal cannabis on prescription - Baroness Meacher
No business scheduled
House of Commons
HM Treasury (including Topical Questions)
Ten Minute Rule Motion
Hereditary Titles (Female Succession) - Philip Davies
Northern Ireland Budget (Anticipation and Adjustment) (No. 2) Bill
House of Lords
Addressing the gender pay gap. - Baroness Nye
Ensuring there are sufficient specialist staff to achieve the priority ambition for stroke care - Baroness Wheeler
Proposed measures to ensure basic air connectivity in the event of a no-deal Brexit - Lord Kirkhope of Harrogate
Preparedness of small businesses for a no-deal Brexit - Baroness Burt of Solihull
Scottish Government Debate: EU Withdrawal Negotiations