Amazon plans to shut three UK warehouses, with 1,200 jobs at risk – business live

Amazon has announced plans to shut three of its 30-plus UK warehouses, affecting 1,200 jobs, our retail corresponent Sarah Butler reports.

Workers from the facilities in Doncaster, Hemel Hempstead in Hertfordshire and Gourock in western Scotland will be offered roles at other Amazon locations.

It is thought unlikely that many of the 300 workers at the Gourock site will want to relocate as there is not another Amazon facility nearby, as is the case with the Doncaster and Hertfordshire factories.

The closures of the older sites come as Amazon prepares to open new delivery warehouses in Peddimore in the West Midlands and Stockton-on-Tees, County Durham, which will employ 2,500 people.

A spokesperson for Amazon said the company remained “committed to our customers, employees, and communities across the UK”, saying:

“We’re always evaluating our network to make sure it fits our business needs and to improve the experience for our employees and customers.

As part of that effort, we may close older sites, enhance existing facilities, or open new sites, and we’ve launched a consultation on the proposed closure of three fulfilment centres in 2023,.

The potential job losses come after Amazon announced last week that it planned to cut 18,000 jobs around the world – mostly in its head offices – in an effort to become more efficient under Andrew Jassy, who took over as chief executive in summer 2021.

More here:

The battery startup Britishvolt is in talks with an Indonesia-linked oil and gas investor for a £160m rescue deal that would almost wipe out the value of existing shareholders’ stakes, my colleague Jasper Jolly reports.

The investor consortium is led by DeaLab Group, a UK-based private equity investor that has been involved in several fossil fuel and renewable energy transactions in Indonesia, and an associated metals business, Barracuda Group.

A takeover of the project, if completed, would provide welcome relief for employees and enable the company to continue its ambitious effort to build a factory capable of making 30 gigawatt hours of batteries every year – enough for hundreds of thousands of cars. Building gigafactories is seen as a key aim by the UK government, which pledged £100m in financial support to the project.

Britishvolt’s site, near Blyth in Northumberland, is seen by many in the automotive industry as one of the UK’s best potential locations for a gigafactory because of proximity to power lines carrying renewable energy and a deep-sea port. However, the startup reached the brink of collapse in October as it ran out of money, with building work on the factory mostly halted since the summer.

Under the terms of the rescue deal, the investors will pay £30m for 95% of the business – a deal that would leave existing shareholders including co-founder Orral Nadjari and FTSE 100 companies Glencore and Ashtead with 5% of the business worth less than £2m. The consortium would then commit a further £128m to fund the next stage in Britishvolt’s plan.

More here:

The average UK price for a litre of petrol has fallen below 150p for the first time since the outbreak of war in Ukraine, bringing some relief to motorists and businesses.

The AA said that a litre of petrol typically cost 149.74p on Monday, its lowest since Russia invaded Ukraine on 24 February 2022, when it averaged 149.67p a litre.

The outbreak of war in Europe sent commodity markets soaring, pushing up the wholesale prices of oil and gas.

Petrol reached a record of 191.53p a litre on 3 July as surging fuel prices fed into rampant inflation and a squeeze on the cost of living.

Luke Bosdet, the AA’s spokesperson on pump prices, said:

“A 41.8p-a-litre crash in the average pump price of petrol is a huge relief for drivers, cutting £22.99 from the cost of filling the typical car tank.”

Here’s the full story:

There are more job cuts in the cryptocurrency world today.

Coinbase Global is cutting about 950 employees, as the digital-asset exchange tries to lower its costs to get through the downturn in the crypto market and the wider economy.

Announcing the move to employees, co-founder and CEO Brian Armstrong explains Coinbase is cutting its operating expenses by about 25%.

He says:

While it is always painful to part ways with our fellow colleagues, there was no way to reduce our expenses significantly enough, without considering changes to headcount.

Armstrong also told staff that in 2022 “the crypto market trended downwards along with the broader macroeconomy”.

He added that there was also “the fallout from unscrupulous actors in the industry, and there could still be further contagion”.

Coinbase is firing a fifth of its workforce, 950 jobs in its 3rd round of firing in 6 months #WinterIsHere https://t.co/5MCGXxFPL1

— Jorge Ordovás (@joobid) January 10, 2023

In the financial markets, shares in Virgin Orbit Holdings are down over 20% in premarket trading, after the UK’s historic attempt to launch satellites into space failed.

Last night, Virgin Orbit’s Cosmic Girl, a customised Boeing 747, released a rocket loaded with nine satellites, in a historic first mission from Spaceport Cornwall near Newquay.

But the rocket was lost after “a technical failure”, which Virgin Orbit has pledged to “tirelessly” investigate, as my colleague Steven Morris reports here.

UK space chiefs have said they would try again to send satellites into space from British soil within a year, but the failure of the mission is a set-back for Virgin Orbit and for Cornwall’s ambitions to be a new launchpad for space ventures.

Shares in Virgin Orbit are on track to drop 22%, to $1.50, when the US market opens.

Virgin Orbit shares lost more than 20% of their value in extended New York trade after the failure of its highly-anticipated attempt to launch satellites. pic.twitter.com/ksFJfpeqPD

— Peter Hoskins (@PeterHoskinsTV) January 10, 2023

Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown, says there were high hopes that last night’s operation would be the start of a brighter future for Virgin Orbit.

Streeter explains:

The cash burn rate for the company has been huge, and the prospects for revenue have been significantly set back.

While space may have been heralded as the new investment frontier, the ventures clearly come with a huge amount of risk.

Given the initial launch from Newquay airport also progressed well, the aborted mission is “hugely disappointing but doesn’t not fully dim Newquay’s prospects as a future space hub”, Streeter argues, adding:

However, as investment case, the flight ahead for space looks set to be volatile.’’

Goldman Sachs has dropped its prediction that the eurozone will fall into recession, but still expects a UK recession this year.

The US investment bank now expects the euro zone economy to grow by 0.6% during 2023, up from its previous forecast of an 0.1% contraction.

Goldman economists, led by Sven Jari Stehn, told clients in a research note that recent falls in gas prices, and the end of China’s Covid-19 restrictions, would support growth, saying:

We maintain our view that Euro area growth will be weak over the winter months given the energy crisis but no longer look for a technical recession.

This reflects more resilient growth momentum at the end of last year, sharply lower natural gas prices and earlier China reopening.

! Goldman Sachs no longer predicts a recession in the euro area – upgrades GDP forecast to +0.6% for 2023 vs -0.1% prior per research note

— Maria Tadeo (@mariatad) January 10, 2023

Growth is expected to be weaker Germany and Italy, which are more reliant on energy-intensive industrial activity, than France and Spain.

Goldman has also raised its UK growth forecast, in response to lower wholesale gas prices.

But, it still expects a UK recession given “persistent headline inflation, rising mortgage rates and structural headwinds to labour supply”.

UK GDP is forecast to fall by 0.7% this year, up from a 1% fall predicted before, with Goldman predicting “a notably more pronounced downturn in the UK than the Euro area”.

The City minister, Andrew Griffith, has been quizzed about crypto assets by MPs on the Treasury Committee this morning.

Griffith said despite risks and “vulnerabilities,” the UK should be at the forefront of a “potentially game changing technology”, quoting an Ernst & Young estimate of a £60bn opportunity.

About 2.3 million people in the UK own some of crypto assets, one MP said.

Griffith said there was clearly a balance to be struck between protecting consumers, saying it was “clearly regrettable” that some had suffered large losses from crypto investments, and reaping benefits from a “disruptive” new technology, such as lower transaction costs.

Asked whether crypto assets can improve financial inclusion, Griffith said he wanted to “hear more on that,” noting that a digital currency is easily accessible via an app. But he said he was “worried” about people who can’t get bank accounts using crypto assets instead, saying it would be “very premature” to remove banks as an intermediary.

The Bank of England is currently considering whether to create a central bank digital currency, like other countries (such as the US, EU, and China).

“With the UK’s strong financial reputation, I’d rather be right than first,” the minister said.

Businesses have expressed “huge disappointment” over the threat to their survival from a sharp reduction in support for their energy bills from the government – and it could hurt Britain’s green ambitions too.

Leading energy consultancy Cornwall Insight argues that – as well as the impacts on business earnings and cash flow – the cut to support could curb businesses ability to invest in decarbonisation.

Gareth Miller, chief executive at Cornwall Insight, said:

“Some larger and more financially resilient firms will still be able to continue their plans. But many may now be unable to create borrowing capacity or free cash flow, at least over the coming few years, whilst they face this cocktail of cost challenges.

“It’s not about the will, it’s about the means. If the government is going to reduce direct support for business energy bills, then perhaps the policy focus should turn to how they can offset this by using tax and investment incentives, the design of energy markets, and greater financial reward for the demand side, allowing businesses to offset financial pressures, as well as maintain their pursuit of net zero.”

Yesterday the government announced a revamp of the capacity market – which is designed to ensure there is a reliable electricity supply regardless of the weather – to incentivise investment into low-carbon technologies.

Amazon has announced plans to shut three of its 30-plus UK warehouses, affecting 1,200 jobs, our retail corresponent Sarah Butler reports.

Workers from the facilities in Doncaster, Hemel Hempstead in Hertfordshire and Gourock in western Scotland will be offered roles at other Amazon locations.

It is thought unlikely that many of the 300 workers at the Gourock site will want to relocate as there is not another Amazon facility nearby, as is the case with the Doncaster and Hertfordshire factories.

The closures of the older sites come as Amazon prepares to open new delivery warehouses in Peddimore in the West Midlands and Stockton-on-Tees, County Durham, which will employ 2,500 people.

A spokesperson for Amazon said the company remained “committed to our customers, employees, and communities across the UK”, saying:

“We’re always evaluating our network to make sure it fits our business needs and to improve the experience for our employees and customers.

As part of that effort, we may close older sites, enhance existing facilities, or open new sites, and we’ve launched a consultation on the proposed closure of three fulfilment centres in 2023,.

The potential job losses come after Amazon announced last week that it planned to cut 18,000 jobs around the world – mostly in its head offices – in an effort to become more efficient under Andrew Jassy, who took over as chief executive in summer 2021.

More here:

Steve Garelick, GMB union officer for Hemel Hempstead, has pointed out that it’s not always practical for workers at one Amazon warehouse to ‘decamp’ to another.

Garelick says (via Sky News):

“Disappointed for the workers and disappointed for the town and a deep concern this is the thin end of the wedge for the local area.

“Some workers may be offered alternative roles but decamping to Luton, Dunstable or Milton Keynes isn’t as practical as you might think.”

Around 500 employees currently work at Amazon’s Hemel Hempstead site, one of the three which are proposed to be closed.

They will all be offered roles at Amazon’s nearby Dunstable warehouse or other nearby locations.

The consultations also involve around 400 staff at its Doncaster site in Balby Carr Bank, who Amazon plans to transfer to its two other fulfilment centres at Doncaster’s iPort.

As flagged at 10.39am, around 300 workers who are currently based at the Gourock site will also be affected if the site closes.

It is understood these proposals are separate from Amazon’s plan to cut around 18,000 jobs worldwide as part of a drive to cut costs, PA Media reports.

There’s some shock that Amazon is ‘resetting’ its UK operations by looking to close three warehouses, after so many years of strong growth, says Ashley Armstrong, The Sun’s business editor.

First warehouse closures at Amazon since its launch in the UK in 1998..After decades of growth there’s a bit of shock that it’s now resetting. These job losses are on top of 18,000 redundancies announced. Online growth is slowing and these are older sites.

— Ashley Armstrong (@AArmstrong_says) January 10, 2023

Staff at Amazon’s Gourock warehouse in Inverclyde, west of Glasgow, were told last night that the site is set to close, according to the Greenock Telegraph.

If the site closes, it would mean the loss of around 300 jobs in the area.

The Greenock Telegraph, the local daily newspaper in the area, says:

The bombshell was broken to employees by management at Faulds Park last night as they announced a ‘consultation’ on the move.

The Tele understands that the sprawling facility – which opened back in 2004 and remains one of the largest employers in the district – could close as early as March 19, in what is a major blow for the area.

Amazon say that all staff will have the chance to relocate to other sites, but bosses have also admitted there will be ‘limited opportunities’ available in Scotland, meaning that many of the workforce will lose their livelihoods.

Shock closure plan revealed https://t.co/hfdn80b4Tj

— Greenock Telegraph (@greenocktele) January 10, 2023

A spokesman for Amazon has said all employees affected by warehouse closures will be offered roles at other Amazon locations.

“We’re always evaluating our network to make sure it fits our business needs and to improve the experience for our employees and customers.

“As part of that effort, we may close older sites, enhance existing facilities or open new sites, and we’ve launched a consultation on the proposed closure of three fulfilment centres in 2023.

“We also plan to open two new fulfilment centres creating 2,500 new jobs over the next three years.

“All employees affected by site closure consultations will be offered the opportunity to transfer to other facilities and we remain committed to our customers, employees and communities across the UK.”

A spokesman for online retail giant Amazon has said the firm has launched consultations over the closure of three UK warehouses.

Sites in Hemel Hempstead, Doncaster and Gourock, in the west of Scotland, have been proposed for closure, PA Media reports.

It is understood that all workers at the sites will be offered roles at other Amazon locations.

Amazon has also revealed plans for two new major fulfilment centres in Peddimore, West Midlands, and Stockton-on-Tees, County Durham, which will create 2,500 jobs over the next three years.

Amazon has said it plans to shut three UK warehouses in a move which will impact 1,200 jobs, PA Media reports.

#Breaking Amazon has said it plans to shut three UK warehouses in a move which will impact 1,200 jobs pic.twitter.com/EaWv0QGlDM

— PA Media (@PA) January 10, 2023

Last week, Amazon announced it was expanding its staff-cutting plans to affect more than 18,000 workers.

The online retailer’s chief executive, Andy Jassy, cited “the uncertain economy” for the move and said Amazon had “hired rapidly over the last several years”.

A Hornby set at the London North Eastern Railway (LNER) Family Lounge at King's Cross Station

Shares in model railway firm Hornby have tumbled by around 20% this morning, after it warned that sales are “behind budget” as the cost of living squeeze hits consumer spending..

Hornby warned that demand had been hit by the “challenging consumer economic climate”, telling shareholders:

We remain cautious in our outlook for the full year and beyond due to a high level of uncertainty around the impact of several factors on our sales such as inflation and mortgage costs for consumers but with employment expected to remain high we are hopeful that the confidence in consumer spending remains.

Group sales for the third quarter covering the key Christmas trading period were ahead of the same period last year, though. Hornby said it benefitted from better availability of stock, price increases, and investment in e-commerce platforms and digital media.

And it is launching a new product this month – a new control system for trains which uses Bluetooth to connect to phones or tablets.