Car industry insists 2,000% increase in sales to Azerbaijan has nothing to do with Russia
Britain’s car industry has insisted that an unprecedented 2,000% increase in vehicle exports to Azerbaijan has nothing to with Russia and is explained by the fact that the former Soviet state is a “flourishing market in its own right”.
Sky analysis has found that the British car sector sent another £40m worth of cars to Azerbaijan in the first month of this year, raising fresh questions about whether those cars were being sent there to circumvent sanctions on Russia.
New data from HM Revenue & Customs shows that while direct car exports to Russia remain at zero, where they have been since the imposition of sanctions in 2022, in January £43m worth of cars were sent to Azerbaijan, the former Soviet state neighbouring Russia.
That meant Azerbaijan, which hitherto had rarely made the top 75 export destinations for British cars, is now the 12th biggest foreign market, by value, for British-made cars: above Switzerland, Canada and Spain.
UK carmakers have pledged not to send cars to Russia, with sanctions formally banning the export of “dual use” items which could be repurposed as weapons in the Ukraine war. There are separate sanctions specifically banning the trade of cars worth over £42,000.
However, Sky News analysis found last week that over precisely the same period as British car exports to Azerbaijan rose sharply, there was a near-simultaneous rise in car exports from Azerbaijan to Russia.
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British-made luxury cars still being bought by rich Russians
The average value of cars sent from the UK to Azerbaijan in January was just over £115,000.
Trade data shows that similar increases in British exports have been seen in other former Soviet Russian neighbours, including Kazakhstan, Armenia and Georgia.
A spokesman from Britain’s motoring lobby group, the Society of Motor Manufacturers and Traders (SMMT), said it had detected no evidence the vehicles being sent to Azerbaijan were destined for Russia – and that they were evidence that it was a “flourishing market in its own right”.
“UK vehicle exports to Azerbaijan – as to many countries globally – have increased due to a number of factors, not least a flourishing economy, new model launches and pent-up demand,” it said.
Azerbaijan’s flatlining economy
However, the notion that the exports were evidence of a flourishing economy stands in stark contrast to the economic data, which show that Azerbaijan’s GDP per capita has been flat for a decade and a half at around $15,000 in purchasing power parity terms.
Since two years preceding the pandemic, the value of car exports to Azerbaijan has risen by more than 2,000%. No other sizeable car market in the world has come close, save for Kazakhstan, the other Russian neighbour, whose imports of British-made cars are up 800%.
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Carmakers told to act after Sky report
The SMMT said: “Wherever the UK automotive industry exports, it is committed to compliance with all trade and economic sanctions, and continues to work closely with government and the new Office For Sanctions to ensure the effective implementation of the regulations.
“There is no evidence available of that commitment being compromised, and it is right to monitor for any potential vulnerabilities in a fast-moving and evolving environment.
“The automotive industry remains in dialogue with government and other international partners enforcing co-ordinated trade restrictions, to ensure adherence to both the letter and the spirit of the sanctions, across all vulnerable sectors.”
While the sheer number of cars going to Azerbaijan is small, the value of those cars is consistently high, averaging well over £100,000 and suggesting they are mostly luxury cars.
There have been similar flows detected from other European nations, including Germany and Poland, to other former Soviet states neighbouring Russia.
Following the original Sky News story last week, Foreign Office Minister Anne-Marie Trevelyan said car companies should examine their orders to ensure they are complying with sanctions rules.
The new version of the ChatGPT AI chatbot has been unveiled and offers near-instant results across text, vision and audio, according to its maker.
OpenAI said it was much better at understanding visuals and sounds than previous versions.
It offers the prospect of real-time ‘conversations’ with the chatbot, including the ability to interrupt its answers.
The firm says it “accepts as input any combination of text, audio, and image and generates any combination of text, audio, and image outputs”.
GPT-4o is to be rolled out over the next few weeks amid a battle by tech firms to develop ever-more advanced artificial intelligence tools.
Monday’s announcement showed tasks such as real-time language translation; using its vision capability to solve a maths question on a piece of paper, and to guide a blind person around London.
GPT-4o can respond to audio in as little as 232 milliseconds, with an average of 320 milliseconds, which the company says is similar to human response time.
To try to ease concerns over bias, fairness and misinformation, the Microsoft-backed company says the new version has undergone extensive testing by 70 external experts.
It comes after Google earlier this year had a major PR blunder over images generated by its Gemini AI system.
GPT-4o model will be free, but premium ‘Plus’ users get a greater capacity limit for messages.
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Previous versions of the chatbot have caused unease in schools and universities due to some students using it to cheat by producing convincing essays.
When it launched two years ago, ChatGPT was said to be the fastest-ever app to reach 100 million active monthly users.
The announcement also stole a march on Google, which is expected to tomorrow show off its own new AI features at its annual developers’ conference.
Nadhim Zahawi, the former chancellor, is to be named as chairman of one of Britain’s biggest online retailers, days after confirming that he would step down from parliament at the next general election.
Sky News has learnt that Mr Zahawi is to be appointed non-executive chair of Very Group, the largest remaining part of the Barclay family’s business empire.
Sources said the appointment, which will see him replacing interim chair Aidan Barclay, would be announced on Monday.
His arrival at Very Group will come during a period of turbulence for the Barclay family, who own The Daily Telegraph but are unable to exert influence over it under a government order while its future ownership remains uncertain, subject to a forthcoming auction.
Mr Zahawi’s appointment at Very Group, first revealed by Sky News in March, is likely to prompt a search for fresh equity investment in the near term, as well as a broader review of its capital structure.
The company, which owns the Very and Littlewoods brands, is weighed down by debt, but has nearly 4.5 million customers and significant expansion targets.
Based in Liverpool, it sells electrical goods, homewares and fashion, backed by a large consumer finance arm.
It is said to have performed resiliently despite uncertainty over its ownership.
The company recently said it had secured £125m of new debt funding from Carlyle Global Credit and IMI, which the company has said is designed to support future growth.
Mr Zahawi, the MP for Stratford-on-Avon since 2010, had a brief stint as chancellor of the exchequer, while he also held ministerial posts at the Department of Health and Social Care – where he oversaw the vaccine rollout during the COVID pandemic – the Department for Business and as chancellor of the Duchy of Lancaster.
He was made Conservative Party chairman by Rishi Sunak but was dismissed for failing to disclose he was being investigated by HMRC and the National Crime Agency over a multi-million pound tax dispute related to the sale of shares in his polling firm YouGov while he was chancellor.
He said he had made a “careless and not deliberate” error after initially saying he had no knowledge of the investigation and had “paid all taxes”.
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February 2023 – Zahawi: Starmer grills Sunak
Mr Zahawi’s announcement last week that he would not stand again at the next election meant he joined the likes of Theresa May, the ex-prime minister, and former Conservative Party chairman Sir Brandon Lewis in deciding to leave parliament.
Prior to his political career, he was the founder of YouGov, while he is now a patron of the Adam Smith Institute, the economic thinktank.
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Mr Zahawi has been playing a role as an intermediary between the Barclay family and the Abu Dhabi-based investor IMI Investments since its interest in participating in a bid for The Daily Telegraph emerged last summer.
He had been tipped to chair the newspaper group if RedBird IMI, a vehicle fronted by former CNN president Jeff Zucker, had been successful in buying it.
However, a fierce backlash from Conservative parliamentarians prompted Downing Street to intervene and amend legislation to prohibit ownership of British newspaper titles by investors connected to a foreign state.
RedBird IMI is now finalising preparations to conduct a further auction of the Telegraph newspapers and The Spectator magazine.
The Barclays, who used to own London’s Ritz hotel, have already lost control of several of their corporate assets.
In February, Yodel Group, their parcel delivery business, narrowly averted insolvency when it was sold to a consortium backed by executives at Shift, a rival.
The parent company of ArrowXL, another delivery firm they own, had been forced into administration by HSBC, its principal lender.
Half of the £1.2bn loan that the Barclays took from RedBird IMI and IMI was secured against their media assets, with the bulk of the remainder said to have been secured against other assets including Very Group.
At various points in the last decade, the Telegraph proprietors have explored a sale of the online shopping business, having valued it at over £3bn.
Very Group and Mr Zahawi both declined to comment.
The major backer of Pinewood Studios is among the suitors vying to buy Village Hotels, one of Britain’s biggest mid-market hotel chains.
Sky News understands Aermont, which specialises in real estate-backed investments, submitted an offer last week for Village Hotels, which is owned by KSL Capital Partners.
City sources said KSL was seeking offers worth in the region of £850m or more.
A number of other parties are also understood to have tabled bids ahead of a deadline last week.
Blackstone, the giant private equity firm, is considering making an offer but has yet to do so, according to insiders.
The auction is being handled by bankers at Morgan Stanley.
It comes months after attempts to sell Center Parcs UK were called off, while a mooted sale of Travelodge has so far failed to result in a deal.
Village Hotels comprises a portfolio of more than 30 properties from Aberdeen to Bournemouth, with rooms available at budget prices.
Founded in 1995 as Village Urban Resorts, the hotels feature pub-style restaurants and gyms.
KSL was reported to have paid £485m for the business when it bought it in 2014 from De Vere Group.
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The Denver, Colorado-based buyout firm has also owned other UK hotel chains including Hotel du Vin and Malmaison.
Aermont and Blackstone declined to comment.
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