Any other business

Among British car factories, Nissan at Sunderland is the most productive and Jaguar Land Rover at Solihull probably the most advanced. As for industrial landmarks, the former British Leyland complex at Longbridge is reduced to a research and development facility for Chinese-owned MG; but ‘Plant Oxford’ at Cowley, the original home of Morris Motors now owned by BMW of Germany, still produces 1,000 Minis per day. And BMW’s decision to halt a £600 million project to build electric Minis there is, I fear, a moment of destiny for the whole UK auto industry. The truth is that the transition to electric cars has descended into chaos. Total UK car production in 2024 was at its lowest (in non-pandemic conditions) since 1954.

If the new Trump era has a theme, it’s one of quixotic disruption with random consequences. In that spirit, stand by for more interventions from activist shareholders seeking to electrify sluggish businesses while making fast bucks on the way through. The first episode over here was the attack by the New York investor Boaz Weinstein on seven London-listed investment trusts, in which he acquired stakes and forced shareholder votes to replace board members, with the aim of taking the trusts’ assets under the management of his own firm, Saba Capital. ‘Go home! You’re selfish and wasteful,’ shouted one headline after Weinstein was emphatically defeated in all seven polls.

The Chancellor’s appeal to regulators last month for suggestions to boost growth was mocked as evidence that the government itself is hopelessly bereft of ideas. Might as well ask traffic wardens to devise urban regeneration schemes, we scoffed, or food safety inspectors to plan state banquets. But it made sense to the extent that smarter regulation really should have the potential to boost economic activity – and there are signs the message has got through. Bank of England governor Andrew Bailey speaks of using Brexit freedoms to shield smaller UK banks from ‘Basel rules’ that would require them to hold larger reserves.

I long to write less about Rachel Reeves and more about world-beating British businesses – such as Brompton, the folding bicycle maker whose fortunes I have followed since I bought the product and interviewed the founder-designer, Andrew Ritchie, 20 years ago. The latest Brompton news was that profits collapsed from £11 million in 2023 to breakeven for the year to March 2024 in the teeth of a post-pandemic demand slump; and that additional hiring has been put on hold after Labour’s NI increase added ‘hundreds of thousands of pounds’ of extra costs. A move from cramped west London premises to a new base at Ashford in Kent, with room for big increases in output and skilled jobs, had already been deferred to 2029.

Headed for ‘the worst of all worlds’ is not where any of us would wish to find ourselves at the start of the new year. But that was the phrase used by the CBI economist Alpesh Paleja to sum up the predictions of member businesses – of reduced hiring and output, rising prices and weak growth. Since that survey, a revision to zero of the official growth figure for the third quarter of 2024 and reports of depressed pre- and post-Christmas consumer spending have provoked even darker whispers of a return to recession. Whence cometh such pessimism? Has it bubbled out of the Tories’ black hole of fiscal shame? Can we blame the Bank of England and the Treasury ‘blob’? Or the rare alignment of planets that’s expected in three weeks’ time?

Forty years ago this Christmas I visited Hong Kong for the first time – a few days after the signing in Beijing of the Sino-British Joint Declaration that sealed the former colony’s transfer to mainland rule in 1997. It was a moment of apprehension, but at least the timetable had been set. And how lucky I was to have experienced that extraordinary outpost as it was then, in such contrast to what China’s masters have made it now. The Christmas Day service in St John’s Cathedral, overhead fans stirring the turbid air, was a poignant glimpse of Hong Kong’s past. Norman Foster’s Hongkong Bank building, the most expensive in the world at the time, was approaching completion as a symbol of commercial confidence in the future.

How is it possible that we’re still reading headlines about the £4 billion fundraising from the Gulf that saved Barclays from a bailout in 2008? It’s not too sweeping to say that most of the financial world smelled something fishy in the undisclosed £322 million of advisory fees that were paid to Qatari investors – and that whiff never went away, despite the collapse of criminal charges against individuals at Barclays in 2019. The Financial Conduct Authority has called the behaviour of Barclays ‘reckless and lacking integrity’, while recognising that the bank ‘is a very different organisation today’.

This column comes to you from Atlanta, Georgia, where but for one giant ‘Trump Stands Up For Families’ billboard and some Harris-Walz placards in the leafier suburbs, you would hardly know there had just been an election. I was hoping to report a whiff of teargas after a contested result, but no. Urban Atlanta voted for Harris but rural Georgia was so solid for Trump that nothing was left to argument. The chattering classes on the east and west coasts may be traumatised, but for plainer folks – with a sense of relief that no violent disruption kicked off – it’s back to daily life and business as usual. Or is that, I wondered, a false observation from conversations with my conference group here? ‘No, you’re right,’ a Washington economist told me over breakfast grits.

Anyone hunting for a ‘Trump trade’ at this late stage has probably missed the US election bus. If you bought gold as a traditional safe-haven asset back in February at £1,600 an ounce, you’d be a smug 33 per cent up by now – though my man in the bullion market tells me the rise is by no means all to do with presidential hopes and fears. There has also been big buying from China possibly linked to moves, with Russia and other unfriendly actors, towards ‘de-dollarisation’ of world trade using a partially gold-backed alternative currency. Which means there could be more upside ahead, my man says, and gold ETFs are still worth a look.