LONDON’S BUSINESS NEWSPAPER
THE NOTEBOOK VICTORIA SCHOLAR ON DEFENSIVE PLAYS, TESCO AND ELON MUSK P12 TUESDAY 10 JANUARY 2023
ISSUE 3,913
RUN THE NUMBERS OUR NEW WEEKLY DEEP DIVE INTO THE UK ECONOMY P13
CITYAM.COM
ROLLING IN IT RECESSION? WHAT RECESSION? ROLLS, BENTLEY AND JAGUAR ALL REPORT BUMPER SALES AND REVENUES
ILARIA GRASSO-MACOLA A GLOBAL economic slowdown may not seem ideal market conditions for luxury carmarkers – but Rolls Royce, Bentley and Jaguar all defied the odds with bumper years, they revealed yesterday. Both Rolls-Royce and Bentley broke more than century-old sales records, with the former delivering over 6,000 cars for the first time in its 118-year history. Bentley meanwhile continued with its
winning streak as it shipped over 15,100 units in the past 12 months following the introduction of new models and an increased demand for vehicle personalisation. Jaguar Land Rover’s (JLR) wholesale volumes in the last three months went up 15 per cent on last year’s levels following an increased demand in North America and the UK. Though all saw dampened demand in China, most saw significant growth in all
the other markets they operate in. Hargreaves Lansdown’s senior investment and markets analyst Susannah Streeter told City A.M. the luxury end of the car market “looks set to ride out the costof-living storm, as wealthier consumers have much deeper pools of resilience to dip into”. “Wealthier consumers are clearly brushing off the rise in grocery and energy bills, like raindrops on a sturdy waterproof jacket, with sales rising 13 per cent in the
UK alone,” Streeter said. Rolls boss Torsten Muller-Otvos said that personalisations and ‘bespoke’ commissions had also reached record levels, with significant demand in the Middle East. A personalised Rolls can run to nearly £500,000. Muller-Otvos said that, despite headwinds in China, demand remains “exceptionally strong” well into 2023. Much of Bentley’s growth came from new hybrid models, including the Flying Spur.
FREE SIGN OF THE TIMES
Goldman set to slash staff in slowdown CHRIS DORRELL WALL STREET banking giant Goldman Sachs will axe 3,200 workers in just days to protect its finances from a likely recession in the US and a slowdown in global deal making. The lender is expected to shrink its staff force by around 6.5 per cent and will tell workers tomorrow if they are part of the cull. Bloomberg first reported the news. While the redundancy drive is better than the worstcase scenario figure of 3,900 quoted by chief David Solomon at the end of last year, it is still among the deepest cuts in the bank’s more than centurylong history. Discussing the plans in December, Solomon, 61, said: “There are a variety of factors impacting the business landscape, including tightening monetary conditions that are slowing down economic activity.” “For our leadership team, the focus is on preparing the firm to weather these headwinds,” he added. The redundancies are likely to be focused in the investment banking division and its consumer arm, although all divisions are expected to face some cuts. Goldman declined to comment when contacted by City A.M. yesterday.
You can say that again: Bank economist says it ‘underestimated’ inflation surge JACK BARNETT THE BANK of England did not understand inflation “well enough” and “underestimated” the strength of the 40-year high price surge, its chief economist admitted in a speech in the US yesterday. Huw Pill said with “the benefit of
hindsight”, the central bank’s “own analysis” failed to foresee inflationary pressures magnified by global supply chain pressures after the pandemic. Inflation has run above the Bank’s two per cent since the summer of 2021. The initial burst was sparked by
trade flows struggling to keep pace with a sudden jump in global spending after governments rolled back restrictions on daily life to tame Covid-19 infections. It was those early signs of inflationary pressures that Pill admitted the Bank overlooked. In February, when inflation was
beginning to rise, the monetary authority forecast the cost of living would peak around seven per cent. Since then, charged by Russia’s invasion of Ukraine jolting international energy markets, inflation surged to a peak of more than 11 per cent in 2022. It has since dropped to 10.7 per
cent and analysts think it will gradually fall this year, although it will likely still be above the Bank’s target by the end of the year. Pill and his boss, Andrew Bailey, have backed nine successive interest rate increases since December 2021, including a 75 basis point rise, the biggest move since the 1980s.
INSIDE RISHI STEPS IN TO WOO ARM INTO LONDON LISTING P3 MILLENNIALS SNUBBED BY BOARDS P4 SANTANDER LAUNCHES BNPL FOR BIG BUSINESS P6 OPINION P16 SPORT P19