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The landscape of automotive innovation has shifted over time. Since the invention of the automobile over a century ago, Europe played a pioneering but today has no longer its position of prominence.

Indeed, in the early 2000s, China decided to go electric. But it’s only in 2015 the European Continent began its transition, confronted with:

→ Volkswagen Emissions Scandal (Dieselgate),

→ Rising Environmental Concerns and the Paris Climate Agreement.

So today, the landscape for electric vehicles (EVs) is evolving, bringing both economic and political challenges.

According to IEA, the surge in electric car sales during 2023 is impressive:

◆ Electric car sales are neared 14 millions.

◆ The total electric car stock reached 40 million.

◆ This growth represents a 35% year-on-year increase compared to 2022.

◆ The 2023 figure is over 6 times higher than the electric car sales recorded in 2018.

◆ 95% of which were: in China, Europe and the United States.

Compared with Western brands, Chinese EVs are more affordable. According to the European Commission, in the EU, Chinese EVs typically sell for 20% less than EU-made models.

After a 9-month investigation, the European Commission believes that China is infringing World Trade Organization rules, and has therefore decided to apply countervailing duties from 4th July, on imports of made-in-China vehicles of up to 38%, compared with the current 10%. Chinese BEV producers benefit from significant state subsidies, posing a threat to EU manufacturers.

The EU’s intervention follows the US’s decision to raise tariffs on Chinese electric cars from 25% to 100% a few weeks ago.

In a move aimed at ensuring fair competition and protecting its automotive industry, this new imposition of provisional countervailing duties on imports of battery electric vehicles (BEVs) from China, could spark a trade war. Indeed, Beijing has threatened to retaliate against European aviation, farmers and spirits makers.

So, both sides agreed to negotiate a possible compromise and have decided to engage in negotiations regarding planned import taxes on Chinese electric vehicles (EVs) in the European market.

These regions play critical roles in shaping the future of EVs. So it’s important for the EU to underscore the need for fair competition, environmental goals and strategic negotiations and avoid a trade war or economic retaliations, which would have repercussions for companies in the automotive sector, but not only

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Pharmaceutical Industry

The Covid-19 pandemic thrust the pharmaceutical industry into the spotlight, intensifying the pressure to deliver swift results. Since, companies faced a host of challenges.

The pharma’s role within the healthcare system is weakening due to:

–  A sudden surge in demand which encourages research and development, but that implies high financial burden

–  Economic strains,

– Suffocating regulatory change.

To remain profitable, pharmaceutical companies need to change their operational strategy as the industry faces new challenges. This is what LloydsPharmacy, once the 2nd largest pharmacy chain in the UK, did but faced with a cliff edge.

LloydsPharmacy, which was founded in 1973, had a significant potential.


Ownership history:

Over the past decade LloydsPharmacy (Clinical Homecare, LloydsDirect, Lloyds Online Doctor and a wholesale AHH) had many owners.

– In 1973, Lloyds Chemist began when Allen Lloyd purchased his 1st pharmacy in Polesworth (UK).

– In 1997, LloydsPharmacy was purchased by Celesio AG and merged with Celesio’s existing UK subsidiary, AAH Pharmaceuticals, forming a network of 1300 pharmacies.

– In 2014, the american healthcare company McKesson acquired Celesio AG, becoming the parent company of LloydsPhharmacy along with its other units: LloydsPharmacy Clinical Homecare, LloydsDirect, Lloyds Online Doctor, and a wholesale arm called AHH.

– In April 2022, McKesson’s UK businesses, including LloydsPharmacy, the wholesaler AAH, and a travel health service, were purchased by the Aurelius Group for £477m.


Transforming the company:

LloydsPharmacy became an omnichannel company platform. This strategy was validated with the significant growth across its online offering during the pandemic.

After the purchase by Aurelius Group, as a result, LloydsPharmacy joined the Hallo Healthcare Group, the holding company brand name for some of the UK’s most renowned healthcare organizations.

So, how did a business which had 1,338 stores at the end of 2022, just a over year later disappear from the high street.

LloydsPharmacy began to exit the pharmacy market, since 2017 due to:

– Government funding cuts

– Higher operating costs.


The chain swung to a pre-tax loss of £148m in the year to 31 March 2017.

The closures began in 2017 and continued with 17 stores in 2018, 60 in 2019, 76 in 2021 and 41 in 2022.

According to the Companies House, for the year ending March 31, 2022, Lloyds Pharmacy recorded further losses, with:

– operating losses worsening from £-35m to £-57m,

– net losses of £-66m, down from £100.8 million the previous year.

The company stepped up its « rationalization program » in 2023. In October 2023, the chain was running 138 pharmacies, compared with 1,338 pharmacies in March 2022 (-90%), according to the figures of General Pharmaceutical Council (CPhC).

In July 2015, LloydsPharmacy purchased all 281 pharmacies in Sainsbury’s supermarkets for £125 million but decided to close all in January 2023.

Liquidation:

LloydsPharmacy filed for voluntary liquidation and blamed the cut in government funding for its widening losses and the reason behind its store rationalization program. 

In 2023, the chain ceased trading, with pharmacy staff transferred to their stores’ new operators.

In the statement of affairs report, the liquidators (Martin Armstrong and Andrew Bailey of Turpin Barker Armstrong Accountants) revealed that the pharmacy business owed £293m to 514 creditors, including:

– £228m owed to Diamond DCO One Limited /Lloyds Pharmacy,

– £50m owed to Aurelius Crocodile, a holding company used to control the business.

However, the financial documents show that as LloydsPharmacy had just £8.2m at its disposal to pay off its debts.

As a conclusion The pharmaceutical industry has faced challenges in recent years:

Low Margins & Diversification

Due to low margins on medications, pharmacies are expanding their offerings to include non-prescription products (parapharmacy). But this expansion requires additional investments.

Competition Risks & Regulation

In fact, the distribution of medications is deregulated, allowing mass-market retailers to enter the sector. It will intensify competition for pharmacies

LloydsPharmacy serves as a notable example. Today, the pharmaceutical industry will need to anticipate these risks and protect itself against the risk of non-payment.

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The World Economic Forum is an independent international organization committed to improve the state of the world, by engaging business, political, academic and other leaders of society in order to shape global, regional and industry agendas.

The Global Risks Report 2023 produced by the WEF presents the results of the latest Global Risks Perception Survey (GRPS), and analyses severe, newly emerging and rapidly changing risks that the world is likely to face.

This 18th edition was written in partnership with : Zurich Insurance & Marsh McLennan.

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EU inflation showed signs of a further fall across EU Member States in December 2022, due to a main fall in energy prices. The Britain’s inflation rate remains high.

Consumer prices rose 10.5 %  in December, the 2nd consecutive monthly decline, thanks to easing gasoline and clothing prices.
UK inflation hits 41-year high of 11.1% in October, as food and energy prices continue to soar.

So policymakers setting interest rates have homed in on domestic signals of inflation to try to assess how persistent higher prices will be, analyzing wage growth and increases in services inflation.

Over the course of a year, the central bank raised interest rates from 0.1 percent to 3.5 percent, and is expected to raise rates again at its next meeting in early February.