Thomas Cook races to secure more rescue funds - BBC News

Thomas Cook could fall into administration this weekend unless the travel company finds £200m in extra funds needed to secure its future.

Banks, including RBS and Lloyds, insist the firm comes up with the new contingency funds in case it needs extra money during the winter months.

A collapse would leave 150,000 holidaymakers stranded and require a huge repatriation effort.

Sources insisted there were still "reasonable prospects" of a deal.

But they added that the coming 24 hours were crucial to the travel group's survival.

The troubled operator hoped to seal a rescue led by China's Fosun this week. But the creditor banks issued a last-minute demand that the travel company find an extra £200m.

Sources have confirmed that the Civil Aviation Authority is on standby with a repatriation contingency plan called Operation Matterhorn. The potential cost of bringing home passengers is put at about £600m.

Worried Thomas Cook customers have been contacting the tour operator to check whether flights and package deals are still going ahead, and it has been reassuring customers over social media.

Skip Twitter post by @ThomasCookCares

Hi Stephen, thanks for getting in touch. Your flight in October will be going ahead as planned as our flights and holidays are unaffected by any media speculation. Please let me know if you need anything else. ^Cal

— Thomas Cook Cares (@ThomasCookCares) September 19, 2019

End of Twitter post by @ThomasCookCares

The firm employs 22,000 staff, 9,000 of those in the UK. It serves 19 million customers a year in 16 different countries.

Financial woes

But Thomas Cook's financial difficulties have mounted over the past year, culminating with the agreement in August of a rescue deal led by its biggest shareholder Fosun, that would see the Chinese firm back refinancing of the 179-year-old British firm.

In July, Thomas Cook produced a business plan saying that it needed £900m in refinancing, up from a previous estimate of £150m. The £900m would come from Fosun, the group of creditors and some other investors.

The group of lenders then commissioned an independent investigation. Its financial advisers said Thomas Cook would require an additional £200m on top of the £900m already required, which would bring the total refinancing needed up to £1.1bn.

What are your rights?

If you are on a package holiday you are covered by the Air Travel Organiser's Licence scheme (ATOL).

The scheme will pay for your accommodation abroad, although you may have to move to a different hotel or apartment.

ATOL will also pay to have you brought home if the airline is no longer operating.

If you have holiday booked in the future you will also be refunded by the scheme.

If you have booked a flight-only deal you will need to apply to your travel insurance company or credit card and debit card provider to seek a refund.

When Monarch Airlines collapsed in 2017, the government organised to bring home all the stranded passengers, whether they were covered by ATOL or not.

Here is more information on Atol protection.

Thomas Cook succeeded in finding a backer to provide the additional £200m, but the BBC understands that the backer has now pulled out and the group of creditors will not come back to the table unless that additional funding is found.

A final vote on that deal was due to take place this week, but it has been delayed until next Friday in the face of the latest demand for extra standby funding.

Earlier this week, Thomas Cook said it was "focused on completing" the deal. It is believed to be negotiating with its banks, bondholders and Fosun in an attempt to keep the rescue on track.

In May, the operator reported a £1.5bn loss for the first half of the year. It has also issued three profit warnings over the past year and is struggling to reduce its debts.

It has blamed a series of problems for its profit warnings, including political unrest in holiday destinations such as Turkey, last summer's prolonged heatwave and customers delaying booking holidays because of Brexit.

It has also suffered from competition from online travel agents and low-cost airlines.

The winter months can put a strain on travel companies' finances as typically there is less revenue coming in, while suppliers need to be paid for services provided over the high summer season.

Mark Burgess, chief investment officer of Columbia Threadneedle Investments, told the BBC that Thomas Cook's creditors were "being very careful" about extending lines of credit, because the firm was "in a precarious financial position".

"Companies don't go bust because they have too much debt - they go bust because they run out of cash," he added.

"Banks are managing their exposure very carefully, because the last thing they want to do is to have to write off loans to the company."

RBS said: "As one of a number of lenders, RBS has provided considerable support to Thomas Cook over many years and continues to work with all parties in order to try and find a resolution to the funding and liquidity shortfall at Thomas Cook."

Thomas Cook is one of the world's largest travel companies. It was founded in 1841 to operate temperance day trips. It now has annual sales of £9bn.

If the rescue deal goes ahead, it would be majority owned by Fosun, which is also a majority shareholder in Wolverhampton Wanderers Football Club and French resort operator Club Med.

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Are you a Thomas Cook customer? If you've been affected by the issues raised here, you can get in touch by emailing haveyoursay@bbc.co.uk.

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2019-09-20 07:52:01Z
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Impossible Burgers are hitting their first grocery stores tomorrow - The Verge

The Impossible Burger, a meat-free burger that’s previously only been available in restaurants, will be available to buy in grocery stores for the first time this week. Starting tomorrow, September 20th, you’ll be able to buy the plant-based burger in 27 Gelson’s Markets stores in Southern California. Impossible Foods says it will bring the burger to more grocery stores — including some on the East Coast — later this month, and it plans to reach every region of the US by the middle of next year.

The launch brings Impossible Foods into even closer competition with Beyond Meat, which already sells its own meat-free burger in grocery stores in addition to restaurants. When it announced its latest burger back in June, Beyond Meat said that it was available to purchase in stores, including Whole Foods, Kroger, Safeway, Publix, Wegmans, Target, and Sprouts. Compared to this list of chains, Impossible Foods is lagging behind in selling its burgers directly to home cooks.

Impossible Foods has been teasing the retail release of its Impossible Burger for the past week, encouraging its followers to guess which city the burgers will debut in. It inadvertently spoiled the surprise on Tuesday, however, when it announced that its in-store launch would be taking place in Westfield Century City in Los Angeles.

Both Impossible Foods and Beyond Meat already sell their burgers to restaurants. Impossible Foods says its burger is now available in over 17,000 restaurants, including more than 7,000 Burger King locations. Meanwhile, Beyond Meat provides Carl’s Jr. with veggie burgers, Subway with meatballs, and it’s also working with KFC on a new plant-based “chicken” recipe.

The Impossible Burger will be available in 12-ounce packages for $8.99 each, and Gelson’s Markets is limiting customers to purchasing 10 packages per visit. The limitation may be disappointing for the most die-hard Impossible fans, but given the reports of meat-free burger shortages that The Wall Street Journal reported earlier this year, it’s not entirely unexpected.

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https://www.theverge.com/2019/9/19/20869271/impossible-burger-foods-gelsons-markets-southern-california-meat-free-plant-based

2019-09-19 13:00:00Z
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3 things NOT to do with your savings now that the Fed has cut interest rates - MarketWatch

The Federal Reserve announced Wednesday that its Open Market Committee had voted to cut the federal funds rate by 25 basis points to a range of 1.75% to 2%.

The federal funds rate is the benchmark interest rate that banks use when lending to one another. Interest rates on loans and deposits are typically influenced by the Federal Reserve’s decisions vis-à-vis the federal funds rate.

“Banks have to lower the deposit rates now in response to the Fed rate cut,” said Dan Geller, founder of consulting firm Analyticom. Here’s what not to do now that the Fed has cut rates:

Don’t ignore certificates of deposit

Rates on certificates of deposit have been falling for months now — the first time that has happened across the board in five years.

As a result, people will earn less substantial returns when they take out a CD these days than they would have at the start of 2019. But that doesn’t mean they should shift away from this savings tool.

In fact, CDs may be a better bet, Geller said. “If you can get a good high-yield now and you’re guaranteed to receive this rate for the next three to five years, you’re going to ride the next recession with a relatively high rate,” he said.

Read more: Trump blasts Jerome Powell after Fed rate cut: ‘No “guts,” no sense, no vision!’

Many people make the mistake of moving their cash into liquid accounts, such as high-yield money-market and savings accounts, particularly as the threat of a recession looms, Geller said.

The yield on those accounts isn’t guaranteed like it is with a CD. He estimates that Americans lost billions of dollars in interest by giving into this money anxiety during the last recession.

“Resist the temptation to think that if you put it in a money-market account that it’s more accessible to you in a time of need,” Geller said. “Even if you have to pay a small penalty at some point to break the CD, it’s worth it.”

Geller’s simple rule of thumb for approaching CDs today: Find the highest rate for the longest term.

Don’t just leave your money in a bank account and forget about it

A recent survey from Bankrate found that nearly 70% of Americans had savings accounts that paid less than 2% interest. At a time when interest rates are falling, that can be an especially costly mistake.

“Do not let your money sit fallow in a bank paying an uncompetitive return,” said Greg McBride, chief financial analyst at Bankrate. He added, “Be prepared to move their money to a bank paying a better return.”

Also see: Millennials share their retirement plans on Twitter — let’s just say it’s not good

Many online banks offer upwards of 2% interest on their savings accounts — even in the current climate. Those banks will continue to compete on interest despite rates falling overall in order to score more customers.

Don’t make major adjustments to your long-term savings plan

The Fed’s interest-rate decision initially sent stocks falling — both the Dow Jones Industrial Average DJIA, +0.13%  and S&P 500 SPX, +0.03%  both dropped in afternoon trading before recovering — largely because the central bank did not clarify whether it will cut rates yet again later this year.

Markets have been volatile in recent months, thanks to monetary policy, an increasingly volatile stock market and President Trump’s ongoing trade dispute with China.

As such, this isn’t the time to pull money out of the market or make significant changes to your retirement planning. Instead, experts suggest seeking out healthy distractions like hanging out with friends or hitting up the gym.

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https://www.marketwatch.com/story/3-things-people-should-not-do-with-their-savings-now-that-the-fed-cut-interest-rates-2019-09-19

2019-09-19 10:08:00Z
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Tesla's Model 3 joins Audi's E-Tron in claiming top safety award - Engadget

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IIHS

The Tesla Model 3 has joined the Audi E-Tron as one of the safest cars on the road, earning a Top Safety Pick+ award from the Insurance Institute for Highway Safety (IIHS). The organization said that the Model 3 earned "good" ratings across the board for tricky accidents like driver- and passenger-side "small overlap front" crashes (below). It also did well to avoid collisions in the first place during 12 mph and 25 mph track tests.

Last month, Audi's flagship E-Tron also garnered a 2019 Top Safety Pick+ award, becoming the first EV to do so, according to the organization. That vehicle also impressed the IIHC with its crash ratings, collision avoidance systems and headlights that automatically dim thanks to a high-beam assist feature.

Along with the two EVs, another alternative fuel vehicle, the hydrogen fuel cell powered Hyundai Nexo, also qualified for a Top Safety Pick+. Chevy's Bolt, meanwhile, earned "good" ratings in most crash tests, but failed to receive a Top Safety Pick award because its headlights gave off too much glare to oncoming drivers.

Tesla's Model 3 has previously received a five-star safety rating from the NHTSA. However, it got into trouble with the organization for making certain safety claims about the Model 3 in its marketing materials. The NHTSA issued a cease and desist letter and referred the matter to the FTC.

The IIHS awards buttress the argument that EVs are safer than internal combustion engine (ICE) vehicles in a crash. Without a large, heavy gasoline engine in the front, the theory goes, manufacturers are better able to design the structure to absorb impacts and protect the occupants. "The fact that the battery can be placed in in a variety of places, maybe with more flexibility than a gas tank, [also] provides the potential to make electric vehicles safer," chief IIHS research officer David Zuby told CNBC.

The IIHS hedged that a bit, though, saying that EVs aren't "inherently" safer than ICE cars. However, Zuby noted that the vehicles seem to be at least on an equal footing. "There's no need to trade away safety for a lower carbon footprint when choosing a vehicle," he said.

Source: IIHS

In this article: Award, Crash, gear, IIHS, Safety, Tesla, TopSafetyPick+, transportation

All products recommended by Engadget are selected by our editorial team, independent of our parent company. Some of our stories include affiliate links. If you buy something through one of these links, we may earn an affiliate commission.

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2019-09-19 10:03:36Z
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OECD Sees Global Economy Slipping to Weakest Growth in a Decade - Bloomberg

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1. OECD Sees Global Economy Slipping to Weakest Growth in a Decade  Bloomberg
2. OECD says global economy will grow at worst pace since financial crisis  MarketWatch
3. Global Growth to Hit Decade Low Amid U.S.-China Trade War  The Wall Street Journal
4. No-deal Brexit will cut 3% off UK economic growth, warns OECD  The Guardian
5. Rising trade conflicts are weakening the global economy  OECD
6. View full coverage on Google News

https://www.bloomberg.com/news/articles/2019-09-19/global-economy-seen-slipping-toward-weakest-growth-in-a-decade

2019-09-19 09:00:00Z
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US futures point to slightly lower open after Fed cuts rates - CNBC

U.S. stocks were set to open slightly lower Thursday morning.

At around 1:44 a.m. ET, Dow futures fell 50 points, indicating a negative open of more than 53 points. Futures on the S&P and Nasdaq were also trading lower.

Wall Street ended Wednesday's session little changed after the Federal Reserve did not match market expectations of further rate cuts this year. The central bank cut the overnight rate by 25 basis points on Wednesday. This is the second time this year the Fed has lowered rates.

Money managers are following a new round of face-to-face talks between Chinese and American officials, starting in Washington later Thursday.

In terms of data, there will be jobless claims and current account numbers due at 08:30 a.m. ET, and existing home sales due at 10:00 a.m. ET.

On the earnings front, Darden Restaurants, Scholastic and Steelcase will be reporting.

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https://www.cnbc.com/2019/09/19/dow-futures-fed-rate-cut.html

2019-09-19 06:15:02Z
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Tesla Model 3 earns IIHS Top Safety Pick+, highest possible safety award - Electrek

The Insurance Institute for Highway Safety has announced that the Tesla Model 3 has won its highest safety award, Top Safety Pick+, after achieving “good” ratings across the board in all of their test categories.  The Model 3 is the second battery electric vehicle to win the award, after the Audi e-tron won it last month.

The Model 3 has won several other safety plaudits, including 5-star ratings in all categories and the lowest probability of injury ever tested from NHTSA, 5 stars from from Euro NCAP while being hailed as setting a “new safety technology benchmark,” and 5-stars from the Australiasian NCAP.

IIHS’ “Top Safety Pick” award requires vehicles to earn “good” ratings in the driver-side small overlap front, moderate overlap front, side, roof strength and head restraint tests, and a good or acceptable rating in the passenger-side small overlap test.  Vehicles also must have a front crash prevention system with an advanced or superior rating and good- or acceptable-rated headlights.

The highest-tier award, “Top Safety Pick+,” further requires “good” ratings in the passenger-side small overlap test and the headlight evaluation.

The Model 3 managed to achieve “good” ratings in headlights and all categories for crash safety, along with a “superior” rating for front crash prevention.  The only injury risk recorded in IIHS tests was a moderate risk of leg injury in driver-side small overlap front crash tests.

In the same release, IIHS stated that the Chevy Bolt narrowly missed out on a Top Safety Pick award due to “poor” headlight performance and an “acceptable” passenger-side small overlap rating.

The Model S previously missed a Top Safety Pick award for the same reason – “poor” headlight performance.

Here’s a video from IIHS announcing the awards, with photos and video from the testing procedures.  Tesla fans, if you’re squeamish, you may not want to watch this one:

IIHS Chief Research Officer David Zuby was quoted in the release, stating that “vehicles with alternative powertrains have come into their own.  There’s no need to trade away safety for a lower carbon footprint when choosing a vehicle.”  The Hyundai Nexo, a fuel cell vehicle, has also earned a Top Safety Pick+ award.

Tesla responded to this news with a blog post touting the award, stating:

We engineer our cars to be the best in the world – in every category. Model 3, our most affordable car yet, is no exception. From the start, we designed it to be among the safest cars ever built, with the goal of getting as many Model 3s on the road as possible to further our mission.

The safety of our customers is what matters most, which is why our active safety features and passive safety equipment come standard on all of our cars. We’re also committed to making our cars even safer over time via over-the-air updates, helping us ensure that all Tesla drivers have access to the best safety features available for their cars.

Tesla was particularly proud of the strength of the Model 3’s all-glass roof, which resisted 20,000 pounds of force during testing – more than the weight of five Model 3s stacked on top of each other.

Previously, IIHS had said that Model 3’s front crash prevention was “superior,” but had criticized the earliest cars for their headlights, rating them only “acceptable.”  Tesla improved the headlights, and IIHS increased their rating.

Click through to IIHS website for a full breakdown of how the Model 3 fared in every test category.  Several videos have been posted showing individual side, moderate overlap, and driver-side small overlap crash tests.

Electrek’s Take

We’ve heard a lot of nonsense lately from people trying to suggest that electric cars aren’t as safe as ICE cars – as if having a giant tank of flammable fluid which is constantly being combusted at a rate of thousands of times per minute is somehow supposed to make a car safer.

One reason among many that EVs can be made safer than gas cars is because EVs can have larger front crumple zones.  Since there’s no engine under the hood, crash energy can be dissipated over a longer area, which slows the car down more gradually and thus reduces the amount of crash energy transferred to the driver.  In this way, when a car crumples in a crash, it helps to make the occupants safer.  Crumple zones have been used in cars since the 1950s.

But despite these advantages, just hours ago we heard the argument that reducing fuel efficiency is supposed to make cars safer.  This is a ridiculous assertion, as we covered earlier on Electrek.

So it’s nice to have yet another confirmation, and a timely one at that, that the current best-selling EV is indeed not only “safe enough,” but safer than almost all other vehicles on the road.

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https://electrek.co/2019/09/19/tesla-model-3-iihs-top-safety-pick-highest-award/

2019-09-19 05:09:00Z
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