Drinks giant Diageo says it will face £111million hit from tariffs — despite UK trade deal with Trump
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DRINKS giant Diageo has said it will face a £111million hit from tariffs — despite the UK striking a trade deal with Donald Trump.
Chief executive Debra Crew said the firm would look to work around the higher costs partly by increasing prices, which will impact US drinkers.
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Diageo has said it will face a £111million hit from tariffs — despite the UK striking a trade deal with Donald Trump
Credit: GIGIL/DIAGEO
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The Guinness, Smirnoff and Johnnie Walker whisky maker said it will still be hit by a ten per cent baseline tariff on imports
Credit: PA
The Guinness, Smirnoff and Johnnie Walker whisky maker said it will still be hit by a ten per cent baseline tariff on imports.
It is the latest example of Keir Starmer's trade deal benefiting the car industry while other firms pay the price of a new world order that makes US exports much more costly.
Diageo's biggest export is Johnnie Walker whisky — which cannot be made in the US or it would not qualify as Scotch.
The brand recently launched a drive tied in to Netflix's Squid Game series with limited edition bottles.
The pain of tariffs has been lessened after a 25 per cent levy on Mexican spirits did not materialise.
Diageo had feared the impact on its Don Julio tequila and Crown Royal whisky brands.
Ms Crew also welcomed the UK's recent trade deal with India, which has opened the world's biggest whisky market.
As well as exporting Scotch it has also launched Godawan, a single malt made in Rajasthan, India.
The FTSE 100 drinks company yesterday said it would revive its fortunes by driving £373million of cost savings and potentially selling some brands.
Finance chief Nik Jhangiani said the dismissals would be 'above and beyond the small disposals seen in recent years'.
President Donald Trump says he won't cut U.S. tariffs on Chinese goods to get Beijing to the negotiating table
Ms Crew emphasised that 'we still have no plans' to offload Guinness.
Richard Hunter, analyst at Interactive Investor, said Guinness accounts for two-thirds of Diageo's beer sales and 'it appears this jewel in the crown is one Diageo is keen to protect'.
SAVE OUR FINAL FRONTIER
THE boss of Airbus' defence and space business has urged the Government to protect its sovereignty in the cosmos.
As part of yesterday's 'reset' with the EU, the UK struck a security and defence partnership to develop a space-related policy.
The hope is this will 'pave the way' for British firms to access a £150billion defence projects fund.
Ben Bridge, chairman of Airbus Defence and Space in the UK, welcomed the deal.
However, he said the industry was waiting for the Government's defence spending review and industrial strategy amid the first increase in military budgets in decades.
He added: 'At the moment, the UK has a fantastic capability in space. It's something we should nurture and invest in because space is becoming an important topic on a number of fronts.'
He said the UK had a £10billion export opportunity in satellite communications, with Brits interacting with 42 satellites a day for services such as location for satnavs.
He went on: 'The impact of losing satellites in the UK would be a £1billion day.'
Mr Bridge said Airbus, and others, were keen for a longer contracts as satellites take three years to build and are typically in orbit for 15 years.
And there are growing signs of hostility in space, with satellites being 'tested' by rogue operators to see if they could be manipulated.
RYANAIR'S PRICES TO TAKE OFF
RYANAIR boss Michael O'Leary warned the airline could hike prices by almost a fifth — as the outspoken CEO flies close to an £84million bonus.
The move comes after the no-frills business posted a 16 per cent fall in profits to £1.5billion after it discounted tickets.
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Ryanair boss Michael O'Leary warned the airline could hike prices by almost a fifth — as the outspoken CEO flies close to an £84million bonus
Credit: Getty
It was also hit by delays to new Boeing planes.
Mr O'Leary said he was confident after 'robust' demand for summer holidays.
Ryanair said it had increased Easter trips by seven per cent and expected fares to rise by a 'mid to high teen per cent'.
Mr O'Leary, 64 — who has led Ryanair since 1994 and aims to stay until l 2028 — is nearing a controversial €100million one-off award triggered if the airline's share price remains above €21 for 28 days in a row.
It has traded above that since the start of the month and yesterday rose by 3.61 per cent to €23.22 on the Euronext — and by 4.6 per cent to £19.80 on the London stock market.
REVOLUT HQ SNUB
THE UK has been dealt a blow after fintech firm Revolut chose to open its new European HQ in Paris.
The London-based group said it will make a £840million investment.
It comes after its chief exec Nikolay Storonsky attacked Britain's 'bureaucratic' processes following a three-year wait to secure a UK banking licence.
Mr Storonsky has previously dismissed the idea of a London listing as 'not rational'.
POUNDLAND'S £1
BARGAIN-hunting bidders are offering as little as £1 to take over Poundland — amid warnings any deal will lead to 200 of its stores shutting.
The struggling chain was put up for sale by Polish parent PEPCO after sales dived following an attempt to sell clothing.
Interest was shown by turnaround firms Gordon Brothers, Endless, Hilco and Modella Capital — which recently bought WH Smith's high street stores.
They are likely to offer a nominal £1 — but will have to pump in up to £100million.
THE CROWN ESTATE, which manages the public properties of King Charles, and Australian developer Lendlease, have announced a £24billion development partnership from London to Birmingham, including offices and 26,000 new homes.
'BYE NOW' STAFF
KLARNA has cut its workforce by 40 per cent due to artificial intelligence advances — and a doubling in losses.
The 'buy now pay later' firm's losses rose from £35million to £68million during the first three months of this year because of one-off costs linked to its halted US stock market listing.
The business has reduced its workforce to 3,422 by not replacing staff and using AI.
Boss Sebastian Siemiatkowski said Klarna will recruit up to 100 human customer agents for detailed advice.
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