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LDV: on their last legs?
Reports have it that LDV; the Midlands based light van maker will be forced to close down in “days rather than weeks” unless they receive a £30 million loan from the UK government loan. Company management at LDV insists that there are no funds available to keep the business afloat.
LDV who have failed to show a profit since 2004have been competing against Ford's Transit van since their founding and have come out bruised and battered every year. Like a Rocky Bilbao of the van world they have always come back for more punishment, but with the news that the number of new vans registered in 2008 down more than forty percent to 4,580 in 2008, it looks like the knock- out punch is not far way. .
LDV's original parent, Leyland DAF, an Anglo-Dutch joint venture, was bought over by US Investment Company Sun Capital, only to be sold on to Gaz of Russia in 2006 for some £50 million.
The company employs around 850 people at their Birmingham plant, where production has been suspended since December 2008, after van sales crashed following a slump in the construction industry. Unfortunately the company's hopes that a sudden and dramatic increase in demand for LDV vans has not transpired and they now seem unlikely to ever resume production.
Another rumour that looks likely to be proved to be fact is the Vodafone Plc, the world’s largest mobile-phone company, seems likely to cut hundreds of jobs in their U.K. outlets. The move is designed to reduce costs and protect earnings during the current economic slowdown. Until an official announcement is made, Vodafone shares remained less unchanged at 26.2 pence.
Vodafone have not enjoyed a good year, their shares declining 22 percent in 2008.
Signs are that even the defence industry is suffering as part of the recession. Another British standard, Rolls-Royce who is the world’s second largest aircraft engines producer saw their shares drop 5.4 per cent (14 pence to 278 pence.) BAE Systems Plc, UK and Europe’s largest defense company also had a stock fall of 3.7 percent (13 pence to 390 pence.)
Britain’s largest state-controlled bank Royal Bank of Scotland, is reputed to be about to slash their running costs, principally by cutting back on investment banking operations. The bank also plans split its trading operations into two units over the next three to five years. One autonomous unit will cover the bank's U.K. and other “core” businesses, whilst the other will control operations that are in the periphery of the RBOS s operation. A sign that this rumour may bear some credence was that the bank's shares rallied 9.8 percent (two pence to 21.2.)
The world’s largest silver producer Fresnel Plc reported an 11 percent drop in full-year profit in 2008. The drop to $128 million was caused by increased production costs and losses on foreign exchange. The FTSE was unforgiving and Fresnillo's shares dropped 5.6 percent (23 pence to 390)
Europe’s largest travel company TUI Travel Plc saw their shares fall 3.5 percent, (8.25 pence to 228) On the news that the company's shipping line Hapag-Lloyd shipping line, is proving hard to sell and may need to be revalued.
On the up were Prudential Plc, U.K.’s second-largest insurer who gained 1.3 percent ( 3.75 pence to 288.75) Another insurer showing a slight rise were the Friends Provident Plc, who added 1.6 pence, or 2.2 percent, to 75.2.
Material supplier to restaurants and offices, Bunzl Plc, announced yesterday that their full-year profit had risen by nine percent in 2008 due to successful acquisitions in Brazil, the U.K. and Spain. On the news Bunzl shares rose by 1.1 percent, ( six pence to 544) .
The FTSE 250 index dropped by 1.42% or 83.93 points to 5,835.41 while the FTSE 100 finished the session down 0.77 per cent, or 29.74 points at 3,820.99
The pound rose to the highest level in more than a week against the dollar as speculation the U.S. government will take larger stakes in banks to shore up the financial system.
- Pound/Japanese Yen 139.23
Wall Street shares had a very poor day, caused by continued uncertainty around the banks. The Dow Jones Average dropped 226 points to close at 8149.03. Nasdaq fell 53.51 to 1387.22.
Gold’s rally appeared to be slowing down on Monday surging above the $1,000 per ounce level on Friday, dipping to $991.
Asian stocks fell sharply on Tuesday amid renewed fears over the health of the global financial sector and after US stocks hit a near 12-year low.
Japan's Nikkei index closed down 1.46%, the Hong Kong index closed down 2.9% and the Shanghai index fell 4.3%.
Most Asian indexes had risen on Monday on hopes the US government was to increase its stake in Citigroup.
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