Transport secretary backs expansion of airports ahead of Gatwick decision; Heathrow posts record passenger numbers – business live | Business

Aston Martin delays electric car; Stellantis swings to loss

Jasper Jolly

The British sportscar maker Aston Martin has delayed its first battery electric vehicle further, as it announced plans to cut 170 jobs in the latest step in its quest for profits.

The FTSE 250 manufacturer on Wednesday said its priority was plug-in hybrid cars, which combine a small battery with a petrol engine. The first electric model will only come in “the latter part of this decade”.

It is the latest delay in the electric plans for Aston Martin, famed as the car driven by James Bond in the British spy films. Aston Martin had planned to showcase an electric car in the last James Bond film, but it cancelled that model. It last year postponed its first electric car to 2026, before the latest delay.

Carmakers around the world have slowed down efforts to switch to electric cars. While sales of electric cars have increased strongly in most large markets, manufacturers had expected faster growth.

Stellantis, the world’s fifth-largest carmaker by sales, on Wednesday said that it would give customers “freedom to choose” between internal combustion engine, electric, and hybrid technologies.

However, it is not just demand for electric models that has hit carmakers. Sales have slowed around the world, and across different technologies.

Stellantis, which owns brands including Fiat, Chrysler, Peugeot and Vauxhall, reported a swing to a loss of €127m in the second half of 2024, compared with a profit of €7.7bn a year earlier. It had shocked investors in the autumn with a profit warning.

The financial turmoil particularly in North America – and a falling out over strategy – led to the resignation of Stellantis chief executive Carlos Tavares in December. Stellantis said it will try to find a new chief executive in the first half of 2025.

Aston Martin appointed Adrian Hallmark as its chief executive last year, making him the fifth boss in five years. The former boss of British luxury car brand Bentley is the latest person appointed to try to make Aston Martin financially sustainable, five years after it was taken over in 2020 by the Yew Tree consortium, led by the US billionaire Lawrence Stroll.

Consumer confidence has unexpectedly worsened in Germany amid a weak labour market.

The consumer confidence index from the research company GfK dropped to -24.7 in February from -22.6 in January, the lowest level since April.

This is putting pressure on Friedrich Merz, whose conservative CDU party came out top in the national election on Sunday, to quickly put together a coalition government with the Social Democrats and tackle Germany’s pressing problems.

Meanwhile in France, consumer confidence improved this month, with people becoming more optimistic about the job situation.

The consumer sentiment index edged up to 93 points in February from 92 points in January, according to France’s statistical office INSEE.

Justin Low, currency analyst at Forex live, said:

That’s the highest reading since October as consumer morale continues to pick up since the turn of the year. That said, it’s still on the weaker side and holding below the long-term average of 100. Of note, there was an uptick in unemployment prospects with the index rising to 55 – its highest since April 2021.

Over in the US, consumer confidence plummeted in February, the biggest monthly decline in nearly four years, a business research group said yesterday, with inflation seemingly stuck and a trade war under Donald Trump seen by a growing number of Americans as inevitable.

The Conference Board reported that its consumer confidence index sank this month to 98.3 from 105.3 in January. That’s far below the expectations of economists, who projected a reading of 103, according to a survey by FactSet.

Apple promises to fix bug in iPhone automatic dictation tool

Joanna Partridge

Apple has promised to fix a bug in its iPhone automatic dictation tool, after some users reported it suggested them “Trump” when they said the word “racist”, before quickly correcting itself.

The glitch was first highlighted in a viral post on Tiktok, when the speech-to-text tool sometimes briefly flashed up the word “Trump” when they said “racist”, and was later repeated by several users on social media.

“We are aware of an issue with the speech recognition model that powers dictation and we are rolling out a fix,” an Apple spokesperson said.

The company blamed the bug on its tool displaying words which have “phonetic overlap” , according to reports, which in this case included words with the ‘r’ consonant.

However, the glitch caused outrage among some conservative commentators in the US, who have long accused big tech firms of political bias against those on the right.

The bug also called into question Apple’s artificial intelligence capabilities, just a day after the company announced a $500bn investment in the US, widely interpreted as a move designed to appeal to Donald Trump’s government.

The tech giant said on Monday the investment, running over the next four years, will include a giant factory in Texas for artificial intelligence servers, and would would create about 20,000 research and development jobs across the country.

The AI announcement came just days after Apple’s chief executive Tim Cook reportedly met Trump. The company could face 10% tariffs on its devices, many of which are assembled in China before being imported into the US.

Good morning, and welcome to our rolling coverage of business, the financial markets and the world economy.

The UK’s transport secretary Heidi Alexander said the government “believes in increasing airport capacity”, as a decision looms on the expansion of Gatwick airport.

Speaking at the annual dinner of trade body Airlines UK in London last night, Alexander said the government would do “all we can to support the sector and take the brakes off growth”.

She has to announce by Thursday whether she has approved Gatwick’s application to bring its emergency northern runway into regular use, which would enable 100,000 more flights every year at the West Sussex airport.

Gatwick said it could relocate the runway, which is currently only used for taxiing and in emergencies, and make it operational by the end of the year. This would cost an estimated £2.2bn – in comparison to Heathrow’s third runway, which is likely to cost far more than the last estimate of £14bn.

The climate change committee dropped its opposition to airport expansion from its carbon budget this morning. In contrast to previous advice that no airport expansion could take place without big cuts to carbon elsewhere, it was not prescriptive about where or how the expansion could occur.

However, like the Heathrow runway, the Gatwick expansion is controversial, with some MPs, local authorities and residents strongly opposed, who point to increased air and noise pollution, climate concerns and the impact on the local community.

The Civil Aviation Authority announced its support for the Gatwick expansion yesterday, saying it would bring “benefits to consumers” citing more choice of destinations for passengers.

Heathrow reported a jump in annual profits this morning after passenger numbers rose to record levels in 2024, just weeks after the chancellor, Rachel Reeves, backed the proposed third runway and said it could be built within 10 years.

Last year 84 million people travelled through Europe’s busiest airport, beating the pre-pandemic record set in 2019 by 3 million.

The airport’s underlying profits rose by 31% to £917m last year while revenues dipped by 3.5% to £3.6bn after the regulator limited charges. However, adjusted pre-tax profits fell by 9%.

Thomas Woldbye, the chief executive, said:

2024 underscores why Heathrow is the UK’s gateway to growth.

Heathrow, which is 15 miles west of London, confirmed it would submit its proposals for a third runway to the government this summer, but said “policy changes are needed to deliver the project successfully” and it would work with ministers, around air modernisation, planning reform and adjustments to the regulatory model for a third runway.

Meanwhile, the British luxury carmaker Aston Martin said it plans to cut about 5% of its global workforce – 170 jobs – as losses widened.

This is intended to save £25m. It said:

We are commencing a process to make organisational adjustments, to ensure the business is appropriately resourced for its future plans.

The Agenda

• 3pm GMT: US New home sales for January

• 3.30pm GMT: US EIA Crude oil stocks

• 4.30pm GMT: Bank of England policymaker Swati Dhingra speaks