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Buying electric cars and insurers vs drivers: This is Money podcast

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What’s the best new or used electric car, would buying your insurance on the day you need it drive up the price, and does London’s diesel-crunching ULEZ make sense?

Those are the questions and more on this motoring special edition of the This is Money Podcast. On it, Georgie Frost and Simon Lambert are joined by deputy motoring editor Rob Hull to talk cars and money.

First up, is our exclusive on how insurers are sneakily pushing up prices for those who buy cover close to when they need it – bad news if you want to choose and buy a car and then drive it away.

The team also look at attempts to crack down on older petrol and diesel cars, such as London’s ULEZ – soon to be extended all the way out to the North and South Circular – and ask whether the crop of electric car alternatives available now are enough to tempt people en-masse.

Simon argues that one of the key problems is not how good new electric cars are (albeit they are now pretty good) but the issue of buying second hand and the limited choice and consumer concerns.

Meanwhile, Rob says that although a brand new electric car may be tempting to those committed to greener motoring, many buyers are likely to sit on their hands expecting a better choice of longer range vehicles to arrive soon.

Jaguar's I-Pace was voted 2019's Car of the Year but it costs from £60,995 - so if you don;t want luxury or even a new car, what electric car can you buy? The podcast team take a look

Jaguar's I-Pace was voted 2019's Car of the Year but it costs from £60,995 - so if you don;t want luxury or even a new car, what electric car can you buy? The podcast team take a look

Jaguar’s I-Pace was voted 2019’s Car of the Year but it costs from £60,995 – so if you don;t want luxury or even a new car, what electric car can you buy? The podcast team take a look 

One of those won’t carry a Golf badge, as VW is ditching its trusty model name for its new ID range of electric cars.

But before they arrive a new Golf will. 

The Golf is a car that has long set the benchmark for family hatchbacks, so with the wraps coming off the next eighth generation one what can we expect inside, outside, and – all importantly nowadays – in terms of tech?

How to listen to the This is Money podcast 

We publish our podcast every Friday to the player on This is Money, above, and on Apple Podcasts (iTunes) and on the podcast platforms Audioboom and Acast, both of which allow you to listen on desktop, mobile, or download an app. We also now publish to Spotify.

To download the Apple Podcasts app if you do not already have it, go to the App store. Or go to either the Apple App store or the Google Play store on Android to download the Acast, AudioBoom or Spotify app. 

Press play to listen to this week’s full episode on the player above, or listen (and please subscribe and review us if you like the podcast) at Apple Podcasts, Acast, Audioboom and Spotify or visit our This is Money Podcast page.   

THIS IS MONEY PODCAST

 

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Petrol station operator EG Group launches audacious swoop for Caltex

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Self-made billionaires Mohsin and Zuber Issa have launched an audacious swoop to expand their petrol station empire.

The ‘rags to riches’ brothers from Blackburn are trying to buy Caltex Australia, muscling out a rival bid from Canada’s Alimentation Couche-Tard.

If successful, it would be their biggest takeover to date, following a string of recent deals.

From rags to riches: Tycoon Zuber Issa, left, with his brother Mohsin, from Blackburn are trying to buy Caltex Australia, muscling out a rival bid from Canada¿s Alimentation Couche-Tard

From rags to riches: Tycoon Zuber Issa, left, with his brother Mohsin, from Blackburn are trying to buy Caltex Australia, muscling out a rival bid from Canada¿s Alimentation Couche-Tard

From rags to riches: Tycoon Zuber Issa, left, with his brother Mohsin, from Blackburn are trying to buy Caltex Australia, muscling out a rival bid from Canada’s Alimentation Couche-Tard

Through their business EG Group – better known as Euro Garages – the pair have embarked on a debt-fuelled expansion spree over the past two years, snapping up foreign rivals.

Recent purchases include 621 petrol stations and convenience stores formerly owned by Cumberland Farms and Fastrac in the US, as well as 540 from Woolworths in Australia.

They own about 5,400 sites across Europe, America and Australia, employing more than 35,000 staff. And now they want to add 1,900 Caltex sites, as part of a huge cash and shares takeover.

EG has offered £2billion in cash and separate shares in a new company – but did not reveal how much the total bid was worth. Caltex is considering the offer, which is competing with a £4.5billion bid by Couche-Tard.

The move is just the latest twist in the extraordinary rise of the Issa brothers, whose parents moved from India to Lancashire in the 1960s to work in a woollen mill.

The brothers were born in Blackburn and started Euro Garages 25 years ago with a £150,000 site in Bury.

Their firm is now Europe’s biggest independent fuel retailer, boasting annual sales of £10billion and tie-ups with Sainsbury’s, Greggs, Spar, Starbucks, Subway and Burger King. It expanded rapidly by snapping up petrol stations previously run by BP, Esso and Shell.

EG’s success has made the siblings two of Britain’s richest entrepreneurs with a combined fortune of £1.2billion, according to the Sunday Times Rich List.

The pair have used some of their spoils to buy a £25million mansion in Knightsbridge, central London, formerly owned by conman Achilleas Kallakis, a far cry from the two-up, two-down terraced house they grew up in.

From a Blackburn terrace to a £25m Knightsbridge mansion 

£25m London house: Formerly owned by conman Achilleas Kallakis, it has planning permission for a three-storey basement extension

£25m London house: Formerly owned by conman Achilleas Kallakis, it has planning permission for a three-storey basement extension

£25m London house: Formerly owned by conman Achilleas Kallakis, it has planning permission for a three-storey basement extension

They have gone from a terraced house in Blackburn to owning a glamorous £25million mansion in Knightsbridge.

Childhood home: The Blackburn terrace

Childhood home: The Blackburn terrace

Childhood home: The Blackburn terrace

But tycoons Mohsin and Zuber Issa have been dragged into a row over their plans for five identical ‘McMansions’.

The three-storey properties are being built after they bought and knocked down eight homes on a site in Blackburn. 

Their proposals were backed in September despite neighbours arguing the design was out-of-kilter with other properties nearby.

Blackburn with Darwen council is said to have received 30 letters of complaint about the plans, and none in favour.

The mansions are just under three miles away from the Issas’ childhood home.

It also has planning permission for a three-storey basement extension that is expected to include a garage with a vehicle lift, a swimming pool and cinema. 

Above ground, the property already features grand reception rooms and a master bedroom suite that takes up the whole second floor.

However, the pair have said they intend to stay close to their roots and normally live in large, neighbouring detached houses on the outskirts of Blackburn.

Zuber, 47, said in 2018: ‘People are always asking when we will move to London or Manchester. But the quality of life [in Blackburn] is great. A lot of people do a few years in London then come to the North West.

‘They want to raise a family and have less pressure.’

Mohsin, 48, who is married with two children, added last year: ‘We could achieve everything we want from a business perspective, but if we didn’t do it with a stable family environment, if we didn’t give back to others, we would feel we had not fulfilled our potential.’ 

In October, it emerged they could float EG on the stock market for £10billion, meaning the two men’s 56 per cent stake could be valued at more than £5billion.

The swoop on Caltex is a headache for Couche-Tard, which is doing due diligence on the Australian firm’s books and claimed its previously unopposed offer was the best on the table. It is expected to force the two rivals into a bidding war, helping to boost Caltex’s shares.

However EG could face regulatory hurdles over its bid to combine its 540 Woolworths sites with Caltex’s outlets.

Australia’s competition watchdog in 2017 blocked BP, an existing retailer in Australia, from acquiring the Woolworths’ network because of competition concerns. 

An EG Group spokesman said its proposal showed it was ‘well-placed’ to bid for Caltex.

 

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Everton Football Club drafts in Laing O’Rourke to build new stadium

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New home: Everton Football Club is planning a 52,000-seat stadium

New home: Everton Football Club is planning a 52,000-seat stadium

New home: Everton Football Club is planning a 52,000-seat stadium

Everton Football Club has drafted in Laing O’Rourke to build its new £500million stadium.

Designs for the 52,000-seat venue on Bramley-Moore Dock on Liverpool’s northern waterfront, were unveiled last summer.

Work will start this year, subject to planning consent, and is expected to take three years. 

The proposed brick, steel and glass design is inspired by the historic docklands nearby, which are part of a Unesco world heritage site.

It features four huge stands, including a home end for 13,000 Everton fans, and has been billed as a major regeneration project for north Liverpool.

 

 

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MARKET REPORT: Housebuilders hit record highs as HSBC tips sector

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A string of housebuilders hit record highs after HSBC tipped the sector as the latest winner from Boris Johnson’s landslide election victory.

In a bullish note, analysts upgraded profit and dividend forecasts as it said the Tory party’s 80-seat majority has ‘brought the prospect of a final settlement of Brexit closer and unleashed pent-up demand in housing’.

This is especially true, HSBC said, in the South East, where Britain’s major builders have a foothold and where it reckons prices will pick up most sharply after a drop in autumn.

Builders tipped: HSBC analysts said the Tory party's 80-seat majority has 'brought the prospect of a final settlement of Brexit closer and unleashed pent-up demand in housing'

Builders tipped: HSBC analysts said the Tory party's 80-seat majority has 'brought the prospect of a final settlement of Brexit closer and unleashed pent-up demand in housing'

Builders tipped: HSBC analysts said the Tory party’s 80-seat majority has ‘brought the prospect of a final settlement of Brexit closer and unleashed pent-up demand in housing’

This is added to an expected rush to take advantage of the Government’s Help to Buy scheme, which will shut to all but first-time buyers from April 2021.

Berkeley Group, Persimmon, Barratt Developments, Bellway and Redrow all closed at record highs. 

HSBC said Barratt and Redrow benefit from having a weighting to southern England. And it pointed to Bellway’s conservative strategy of disciplined land-buying – bumping its target price from 4300p to 5470p – and Crest Nicholson’s upcoming turnaround as reasons to be buoyant about the company, which is one of their top picks. 

Stock Watch – Distil  

Rum and vodka maker Distil has signed a deal to make new drinks with honey and gin maker British Honey Co (BHC).

Each will put £30,000 into the joint venture and will trade other skills in a wider partnership. 

AIM-listed Distil will be able to use BHC’s distillery and Distil will help with BHC marketing its own brands.

Distil warned investors it is likely to rack up unbudgeted costs and these could mean profits come in below expectations – but shares still rose 3 per cent, or 0.03p, to 0.85p.  

Crest rose 1.6 per cent, or 5.9p, to 519p while Persimmon was up 1.7 per cent, or 55p, to 3298p.

HSBC also moved Berkeley Group up from ‘hold’ to ‘buy’, as it believes the firm, which climbed 2.1 per cent, or 112p, to 5474p, will see the smallest hit once the Help to Buy changes come into force.

The upgrade means HSBC now has ‘buy’ ratings on all nine listed housebuilders. Shares in peer Taylor Wimpey also rose – by 1.9 per cent, or 4.5p, to 236.2p.

This nudged the FTSE 100 up 0.9 per cent, or 75.01 points, to close at 7457.02, though the blue-chip index also got a boost from a slowing in the rate of new cases of the coronavirus. 

But despite the slowdown, Berenberg analysts are not convinced the cruise industry will recover soon.

The German investment bank kept a ‘sell’ rating on Carnival as it said a likely fall in future bookings will add to the initial damage of cancellations and compensations, meaning cruise companies may need to offer a £39 discount per passenger to fill ships.

Carnival, whose Diamond Princess ship had the highest concentration of coronavirus cases outside of China, rose by 1.1 per cent, or 33p, to 3116p.

The FTSE 250 climbed 0.6 per cent, or 172.40 points, to 21,850.86, helped by a 12.2 per cent rise in Hochschild Mining, which added 20.7p to close at 181.2p. 

The gold and silver miner saw its 2019 profits almost double to £59million as better prices for precious metals – pushed higher by trade tensions between the US and China – combined with lower costs.

Tech group Micro Focus launched a £1.1billion debt refinancing soon after chairman Kevin Loosemore announced he would leave, and it kicked off a strategic review after revenues plunged almost 30 per cent last year. 

It finished 1.9 per cent, or 14.9p, higher at 801.2p.

Royal Mail was the victim of a scathing broker update, falling 2.9 per cent, or 5.2p, to 174.2p as Liberum kept a ‘sell’ rating on its stock and slashed the price target to 120p form 175p. 

Analysts claimed its strategy is ‘undeliverable’, and that managers openly questioning whether it will meet its 2024 targets is ‘hardly encouraging’.

And small-cap group Avon Rubber, which makes equipment such as gas masks and dairy tubes that milk cows, rose 0.2 per cent, or 5p, to 275p as it clinched a new chairman, Bruce Thompson, and was tipped to join the FTSE 250 in the next reshuffle in March.

 

 

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