The week that was: EVs out of juice, star investors struggle and rate expectations
The week after Easter might be short and – traditionally – lacking in big news, but there was no shortage in stories to reflect on over a weekend of indulgence in whatever it was you chose to give up for Lent.
Here’s another rundown of the biggest stories to have happened in the Square Mile and beyond last week.
EV market has the handbrake on
As last year drew to a close, doughy-eyed electric vehicle (EV) evangelists heralded 2024 as the year of the battery-powered motor. Some of the sector’s KoolAid drinkers forecast a 70 per cent year-on-year increase in sales, while others likened the pent-up demand among consumers to that of a “dam showing signs of linking” ready to “collapse in the coming months”.
Fast forward just four of those months, and little of this has come to pass. New data, out on Thursday, from the Society of Motor Manufacturers and Traders (SMMT), found new EV registrations were up just 3.8 per cent in Britain, with almost all of this growth coming from business and fleet purchases.
Among actual drivers – whose concerns with range and the higher up-front cost of an electric vehicle have been well documented – sales are actually falling.
Such EV ennui is, unsurprisingly, reflected in the sales numbers of the world’s two largest sellers of EV companies. Both Tesla and Chinese market-leader BYD have reported a sharp decline in sales, prompting speculation that – without new technology to allay consumers’ fears – we may have already reached peak EV.
Investor ‘doghouse’ operates one-in-one-out policy
Wednesday was a day of mixed fortunes for two of the world’s most renowned money men.
Nelson Peltz, the star activist investor revered and feared in boardrooms of some of the world’s largest firms, missed out on his fairy tale ending at Disney, after the media giant managed to defeat the billionaire’s bid for a seat on the board.
Shareholders were said to have voted “by a substantial margin” to elect the board nominees recommended by Disney, in what many will see as a broadside to Unilever board member Peltz and his firm, Trian.
Closer to home, and the UK’s largest investment fund, Fundsmith Equity, regained its status as Interactive Investment’s most bought fund. The news will be welcome respite to Fundsmith’s inimitable founder – and mayonnaise purist – Terry Smith, who recently saw the same fund appear on Bestinvest’s ‘doghouse’ list.
Rate expectations
Most of us like to spend Easter tucking into a leg of lamb (vegan equivalents are available) and a quease-inducing quantity of chocolate. Not so for members of Bank of England’s Monetary Policy Committee, who appeared to spend the weekend telling anyone who would listen that interest rates won’t come down as much as the market expects.
Meanwhile across the pond, and Jerome Powell was in a dovish mood on Thursday, suggesting to a group of Stanford students that there was room for three rate cuts this year alone.
And in Europe, where figures out on Wednesday showed inflation is down to just 2.4 per cent, there appears to be even more pressure for the European Central Bank to get chopping. The inflation numbers were the fourth straight fall and brought the rate at which prices are rising in the region to within a hair’s breadth of its two per cent target.