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Some of the world’s largest car manufacturers and vehicle producing nations will not sign a global deal to cut new car emissions by 2040, dealing a blow to one of Boris Johnson’s key ambitions for the COP26 summit.

Volkswagen and Toyota, the world’s two largest manufacturers are among those that have declined to agree to the ‘Route Zero’ pledge, due to be announced in Glasgow on Wednesday.

Mr Johnson said making progress on cars was one of his four priorities for COP26, but as he returns to Glasgow today for the final days of the summit a key emissions target has been watered down because of opposition.

Environmental protesters outside Volkswagen's annual meeting in Berlin, 13 March 2018
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Environmental protesters outside Volkswagen’s annual meeting in Berlin, 13 March 2018

Negotiators had hoped to announce a deal committing car manufacturers and governments to reaching 100% zero emission new car and van sales in leading markets “by 2035 or earlier”.

In the final deal the deadline has been pushed back five years to 2040, or by 2035 in “leading markets”.

The UK government is committed to outlawing the sale of new internal combustion engine vehicles by 2030, and will commit to making all HGVs zero-emission by 2040.

Six manufacturers and 24 countries have agreed to the Glasgow commitments, including major American manufacturers GM and Ford, as well as Mercedes, Volvo, Jaguar Land Rover and Chinese manufacturer BYD.

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The support of American manufacturers is significant given the US share of global transport emissions, but it remains to be seen if government support is forthcoming for the deal.

Cynthia Williams, director of sustainability at Ford, said: “We are moving now to deliver breakthrough electric vehicles for the many rather than the few and achieving goals once thought mutually exclusive – protect our planet, build the green economy, and create value for our customers and shareholders. It will take everyone working together to be successful. Partnerships like RouteZero can build momentum and deliver real solutions.”

But the absence of VW and Toyota and BMW, as well as government support from China and Germany, is a blow to progress on a key source of global carbon emissions.

WIESBADEN, HESSEN - DECEMBER 22: Toyota cars are offered for sale at a car dealership on December 22, 2008 in Wiesbaden, Germany. Today Japanese carmaker Toyota Motor Corp., the world's second largest car manufacturer announed a 91 percent lowered net income forecast. (Photo by Ralph Orlowski/Getty Images)
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Japanese car giant Toyota was one of the three companies that declined to sign the deal on car emissions

All the manufacturers who have snubbed the deal say they are committed to reducing emissions and transitioning their fleets from internal combustion engines to battery electric or hydrogen power.

They all have concerns however at the viability of delivering promises that they may not be able to deliver because of external factors in various markets.

Volkswagen has said that while it is committed to the goal of zero-emission vehicles it will not sign up because of concerns about different rates of energy decarbonisation in global markets.

In a statement it said: “While transformative speed is of the essence, the pace of transformation will still differ from region to region (Europe, US, South America, China) depending, among other things, on local political decisions driving EV and infrastructure investments.

BMW
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BMW was another company that declined to sign the agreement

“Furthermore, we believe that an accelerated shift to electro mobility has to go in line with an energy transition towards 100% renewables. While the overall global goal of reaching zero emissions in line with the Paris Agreement is non-negotiable, regions developing at different speed combined with different local prerequisites need different pathways towards zero emissions.

“Therefore, the Volkswagen Group, representing business activities in all major-markets world-wide, decided not to sign the declaration at this point in time.”

Japanese giant Toyota is understood to have decided not to sign the pledge because of concerns about the pace of development of infrastructure, energy markets and other enablers of the transition away from petrol and diesel.

BMW said: “There remains considerable uncertainty about the development of global infrastructure to support a complete shift to zero emission vehicles, with major disparities across markets.”

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Tide turns as TPG leads talks to lead digital bank fundraising

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Tide turns as TPG leads talks to lead digital bank fundraising

TPG, the American private equity giant, is in advanced talks to take a stake in Tide, the British-based digital banking services platform.

Sky News has learnt that TPG, which manages more than $250bn in assets, is discussing acquiring a significant shareholding in the company.

Sources said that Tide’s existing investors were expected to sell shares to TPG, while a separate deal would involve another existing shareholder in the company acquiring newly issued shares.

The two transactions may be conducted at different valuations, although both are likely to see the company valued at at least $1bn, the sources added.

The size of TPG’s prospective stake in Tide was unclear on Monday.

Earlier this year, Sky News reported that Tide had been negotiating the terms of an investment from Apis Partners, a prolific investor in the fintech sector, although it was unclear whether this would now proceed.

Tide has roughly 650,000 SME customers in both Britain and India, with the latter market expanding at a faster rate.

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Morgan Stanley, the Wall Street bank, has been advising Tide on its fundraising.

Tide was founded in 2015 by George Bevis and Errol Damelin, before launching two years later.

It describes itself as the leading business financial platform in the UK, offering business accounts and related banking services.

The company also provides its SME ‘members’ in the UK a set of connected administrative solutions from invoicing to accounting.

It now boasts a roughly 11% SME banking market share in Britain.

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Tide, which employs about 2,000 people, also launched in Germany last May.

The company’s investors include Apax Partners, Augmentum Fintech and LocalGlobe.

Chaired by the City grandee Sir Donald Brydon, Tide declined to comment on Monday.

TPG also declined to comment.

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Trump trade war could still see America come off worse

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Trump trade war could still see America come off worse

It is a trade deal that will “rebalance, but enable trade on both sides,” said Ursula von der Leyen after the EU and US struck a trade deal in Scotland.

It was not the most emphatic declaration by the president of the European Commission.

The trading partnership between two of the biggest markets in the world is in significantly worse shape than it was before Donald Trump was elected, but this deal is better than nothing.

As part of the agreement, European exports to the US will be hit with a 15% tariff. That’s better than the 30% the bloc was threatened with but it is a world away from the type of open and free trade European leaders would like. The EU had offered tariff free trade to the US just weeks before the deal was announced.

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Instead, it has accepted a 15% tariff and agreed to ramp up its energy purchases from the US.

The EU tariff on US imports will remain close to zero but Europe did get some important exemptions – on aviation, critical raw materials, some chemicals and some medical equipment. That being said, the bloc did not achieve a breakthrough on steel, aluminium or copper, which are still facing a 50% tariff. It means the average tariff on EU exports to the US will now rise from 1.2 % last year to 17%.

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There is also confusion over the status of pharmaceuticals – an important industry to Europe. Products like Ozempic, which is made in Denmark, have flooded into the US market in recent years and Donald Trump was threatening tariffs as high as 50% on the sector.

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US and EU agree trade deal

It appears that pharmaceuticals will fall under the 15% bracket, even though President Trump contradicted official announcements by suggesting a deal had not yet been made on the industry. The risk is that the implementation of the deal could be beset with differences of interpretation, as has been the case with the Japan deal that Trump struck last week.

It also risks fracturing solidarity between EU states, all of which have different strategic industries that rely on the US to differing degrees. Germany’s BDI federation of industrial groups said: “Even a 15% tariff rate will have immense negative effects on export-oriented German industry.”

The VCI chemical trade association said rates were still “too high”. For German carmakers, including Mercedes and BMW, there was some reprieve from the crippling 27.5% tariff imposed by Trump. The industry is Europe’s top exporter to the US but the German trade body, the VDA, warned that a 15% rate would “cost the German automotive industry billions annually”.

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Who’s the winner in the US-EU trade deal?

Meanwhile, François Bayrou, the French Prime Minister, described the agreement as a “dark day” for the union, “when an alliance of free peoples, gathered to affirm their values and defend their interests, resolves to submission.”

While the deal has divided the bloc, the greater certainty it delivers is not to be snubbed at.

Markets bounced on the news, even though the deal will ultimately harm economic growth.

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‘Millions’ of EU jobs were in firing line

Analysts at Oxford Economics said: “We don’t plan material changes to our eurozone baseline forecast of 1.1% GDP growth this year and 0.8% in 2026 in response to the EU-US trade deal.

“While the effective tariff rate will end up at around 15%, a few percentage points higher than in our baseline, lower uncertainty and no EU retaliation are partial offsets.”

However, economists at Capital Economics said the economic outlook had now deteriorated, with growth in the bloc likely to drop by 0.2%. Germany and Ireland could be the hardest hit.

While the US appears to be the obvious winner in this negotiation, uncertainty still hangs over the US economy.

Trump has not achieved his goal of “90 deals in 90 days” and, in the end, American consumers could still bear the cost through higher prices.

That of course depends on how businesses share the burden of those higher costs, with the latest data suggesting that inflation is yet to rip through the US economy. While Europe determined on Sunday that a bad deal is better than no deal, some fear that the worst is yet to come for the Americans.

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US and EU agree trade deal, says Donald Trump

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US and EU agree trade deal, says Donald Trump

The United States and European Union have agreed a trade deal, says Donald Trump.

The announcement was made as the US president met European Commission chief Ursula von der Leyen at one of his golf resorts in Scotland.

Speaking after talks in Turnberry, Mr Trump said the EU deal was the “biggest deal ever made” and it will be “great for cars”.

The US will impose 15% tariffs on EU goods into America, after Mr Trump had threatened a 30% levy.

He said there will be an EU investment of $600bn in the US, the bloc will buy $750bn in US energy and will also purchase US military equipment.

Mr Trump had earlier said the main sticking point was “fairness”, citing barriers to US exports of cars and agriculture.

He went into the talks demanding fairer trade with the 27-member EU and threatening steep tariffs to achieve that, while insisting the US will not go below 15% import taxes.

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For months, Mr Trump has threatened most of the world with large tariffs in the hope of shrinking major US trade deficits with many key trading partners, including the EU.

Ms von der Leyen said the agreement would include 15% tariffs across the board, saying it would help rebalance trade between the two large trading partners.

In case there was no deal and the US had imposed 30% tariffs from 1 August, the EU has prepared counter-tariffs on €93bn (£81bn) of US goods.

Ahead of their meeting on Sunday, Ms von der Leyen described Mr Trump as a “tough negotiator and dealmaker”.

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