Business headlines: Thomas Cook; Huawei; Purdue Pharma; Toyota; Suziki; Micro Focus

Businessman reading newspaper and having coffee

It’s vital to be aware of the latest news in the industry you’re working in or applying to. Here are some headlines you might find interesting:

UK car industry in decline for fourteen months in a row
The UK car industry has recorded its longest period of decline since 2001, according to figures from the Society of Motor Manufacturers and Traders (SMMT). The number of cars being produced fell to 108,239 in July, a 10.6% decline from the same month last year. The sector has now been in decline for fourteen months, which is a more prolonged downturn than the one that occurred during the 2008/2009 financial crisis. One of the biggest drivers of the downturn is a decline in export orders, with overseas shipments falling 20.2% since January. The SMMT blamed escalating trade tensions as one reason behind the fall in exports.

Thomas Cook agrees rescue deal with Fosun Tourism
Travel company Thomas Cook has said it has agreed on a rescue deal with Chinese investor Fosun Tourism, its banks and a majority of its bondholders. The travel firm reported a £1.5bn half-year loss this summer and has issued three profit warnings in a year’s time as it’s struggling to reduce debts. In July, it confirmed it was working to secure new investment form Fosun, its largest stakeholder. Fosun will take control of the business as part of a deal which will see it invest £450m in return for at least 75% of Thomas Cook’s tour business and 25% of its airline. A further £450m will be contributed by the travel firm’s lending banks and bondholders for a 75% stake in the airline and up to 25% of the tour operator business.

Next Huawei flagship phone will not have Google apps
Huawei’s next flagship smartphone will not come with Google apps. Google is not able to licence its apps, which include Maps and YouTube, to the Chinese phone maker because of a US government ban on sales to the company. The next phone will also not have access to the Google Play store, which could limit customers’ access to other popular apps. The US has put restrictions on American companies’ right to sell products and services to Huawei because of national security concerns to do with the company’s link to the Chinese government. Huawei has always rejected these concerns. The firm stated that it will continue to use Google’s Android OS if the US government allows it to do so. If not, it says it will develop its own operating system.

Supermarkets still offering misleading special offers, according to Which? consumer group
Consumer group Which? has said it has found that UK supermarkets are still offering misleading deals despite rules designed against these practices. Which? looked at prices across seven UK supermarkets: Asda, Iceland, Ocado, Morrisons, Tesco, Waitrose and Sainsbury’s. Analysing data from May 2018 to June 2019 for 459 products, it found misleading pricing tactics such as multi-buy deals that cost more despite the alleged offer and ‘special offers’ in which goods are sold at the same special price most of the year. A previous Which? survey in 2015 led the government to introduce new guidance on pricing practices which states that retailers have to ensure that the information they provide to customers is fair and does not cause them to overspend or buy something they don’t need. Which? said it would report its latest findings to the Consumer and Markets Authority.

Purdue Pharma to offer up to $12bn to settle opioid lawsuits
Purdue Pharma, the maker of opioid OxyContin, is reported to be offering between $10bn (£8.2bn) and $12bn (£9.8bn) to settle over 2,000 lawsuits against it. The firm, which is owned by the billionaire Sackler family, is one of 22 opioid makers, distributors and pharmacies that are facing thousands of lawsuits due to go on trial in October. Opioids played a role in almost 400,000 overdose deaths in the US from 1999 to 2017. Purdue told the BBC that it is working towards a ‘global resolution’ for the cases against it, but would not confirm any amount.

Car manufacturer Toyota has announced a tie-up with rival Suzuki worth over £700m as they plan to ramp up investment in driverless car technology.

Software company Micro Focus International saw its shares drop by as much as 30% after it announced that sales will be 6 to 8% lower than last year’s as a result of a ‘deteriorating macro-environment’.

 Source: HN Global.