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Daily business and finance update 22nd April 2024

Inflation not yet cool enough

Good morning. Today we're talking about Uk inflation, Superdry’s latest turnaround and Tesla cutbacks.

Big Stories

Inflation not yet cool enough

UK consumer prices edged down to 3.2% in March from 3.4% the previous months. However, this decrease is not enough to warrant immediate interest rate cuts by the Bank of England which were last raised to 16-year highs. Despite higher fuel prices and a national living wage increase, core inflation (excluding food and energy) remained stubbornly above forecasts. While March marks the lowest inflation in over two years and falls below US inflation rates, the UK central bank requires further evidence of a sustained downward trend before considering rate cuts. The UK's inflation struggles differ from the US, with supply chain issues playing a larger role than consumer spending. This distinction suggests the UK's path to rate cuts may diverge from the US.

Superdry on the brink

Facing mounting financial pressures, fashion retailer Superdry announced a significant restructuring plan, including delisting from the London Stock Exchange. This move aims to achieve "significant" cost savings and allow Superdry to operate outside the "heightened exposure of public markets," according to the Cheltenham-based company. The once-popular brand, known for its hoodies and jackets, has seen its share price plummet in recent years. To bolster its financial health, Superdry will also seek additional capital through fundraising efforts. Additionally, they plan to negotiate rent reductions with landlords for 39 UK stores and potentially renegotiate payments owed to local authorities. Superdry has warned that failure to implement the restructuring plan could force them into administration. The announcement comes two weeks after Superdry's co-founder, Julian Dunkerton, abandoned a potential takeover bid with partners.

Tesla cuts back

Tesla is undergoing a significant restructuring in response to a slowdown in electric vehicle demand. The company announced a workforce reduction of over 10% globally, with certain divisions potentially facing cuts closer to 20%. This news coincides with the departure of two senior executives and a delay in deliveries for the highly anticipated Cybertruck. These measures come after Tesla missed delivery expectations last quarter, marking its first decline since 2020. Analysts remain cautious, anticipating a potential contraction in Tesla's year-end sales figures. The company's struggles are further compounded by delays in their mass-market electric vehicle, originally intended to compete with lower-priced EV options in key markets.


Out of work: UK unemployment rose unexpectedly to 4.2% in February raising concerns that employers are beginning to lay off staff in response to high interest rates.

UK departure: Getir, the grocery delivery app once valued at nearly $12bn, is close to exiting the UK in a move that would put over 1,000 jobs at risk.

Russian resurgence: New forecasts from the International Monetary Fund predict Russia will grow faster than any other major economy this year.

Password payoff: Netflix says its profits have soared in the first three months of this year, partly thanks to a crackdown on password sharing.

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Number of the Day

$56 billion

Elon Musk's compensation package which Tesla is once again asking shareholders to approve, after a US court voided it earlier this year

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