Money Buzz! Europa

Tag: coronavirus

  • Industrial production in Slovakia, lowest level since 2009

    Industrial production in Slovakia, lowest level since 2009

    In March, industrial production in Slovakia decreased by 19,6 % year-on-year, reaching the lowest level since May 2009, show the latest data published by Statistical Office of The Slovak Republic.

    The development was affected by a drop in manufacturing by 21,4 % and in electricity, gas, steam and air-conditioning supply by 10,4 % and by an increase in mining and quarrying by 7,2 %.

    The most significant drop was recorded in manufacture of transport equipment by 38,3 %, manufacture of machinery and equipment by 18,2 %, manufacture of rubber and plastic and other non-metallic mineral products by 16,1 %, manufacture of computer, electronic and optical products by 41,1 % and other manufacture, repair and installation of machinery and equipment by 30,7 %.

    The total production saw an increase in manufacture of electronic equipment by 5 %, mining and quarrying by 7,2 % and in manufacture of food, beverages and tobacco products by 0,7 %.

    Compared with March 2019, in terms of the main industrial groupings, production of durable consumer goods decreased by 41,5 %, production of investment goods by 31,3 %, production relating to energy by 10 %, production of non-durable consumer goods by 9,7 % and production of intermediate goods by 7,7 %.

  • Restaurants in Austria to reopen on May 15

    Restaurants in Austria to reopen on May 15

    Heute writes that all restaurants in Austria will reopen on May 15, as Sebastian Kurz, Elisabeth Köstinger and Rudolf Anschober informed on Friday.

    Next Friday, Austria’s restaurant and pub owners are allowed to open again. However, certain rules also apply and strict compliance with hygiene regulations. The government exchanged views with 6.000 owners across Austria to develop the concept.

    Taverns, restaurants and cafes may be open between 6 A.M. and 11 P.M. The staff in direct contact with guests must wear a mouth-nose mask. A maximum of four adults are admitted to a table plus their children.

    There must be at least a meter safety distance between people who are not sitting at a table.

    Clients are allowed without prior registration to any restaurant or pub, but are kindly asked to make a reservation in advance to ensure that there are free spaces.

    The new regulations for the reopening of restaurants will be published on the website of the Ministry of Health, but for the time being there should be no penalties for violations.

  • Forced transformation of automotive industry after Covid-19

    Forced transformation of automotive industry after Covid-19

    In Romania, the first wave of industries affected by COVID-19 was linked to the ones that required human mobility, such as transportation, hospitality, or tourism. The second wave is now taking place in automotive and manufacturing, that need to reinvent themselves and try to go back to something as close to normality as they can, show Mazars.

    The Romanian automotive industry, made of ~600 companies with approx. 230,000 employees, represents a significant part of the economy including both production of cars, the most important ones being Dacia and Ford, and the production of car components with important players like Faurecia, Valeo, and Continental.

    According to ACAROM (The Association of Romanian Automotive Manufacturers), the production of cars and car components reached in 2019 approx. 30 BEUR (+3% increase compared to 2018), generating 14% of PIB and 27% of the total export. The production of auto units reached 490,000 units from Dacia and Ford together during 2019, aiming in 2020 for almost 700,000 units.

    March 2020 – a milestone in the automotive’s history page

    The automotive industry advance stopped, and the production came to an almost complete standstill in March 2020 due to serious threats generated by the COVID-19 pandemic.

    Dacia shut down production starting with 19th March and 13,500 employees out of a total of 14,000 were sent into technical unemployment. Dacia began gradually restarting its production on 21st April, aiming to reopen the entire factory on 4th May. Similarly, 6,000 employees from Ford went into technical unemployment from 19th March until 4th May.

    Stopping the national and international car production led also to an almost full stop of the local car components production – being perceived for the moment as the most affected industry in Romania, due to COVID – 19 challenges.

    Resuming the production, but with great caution

    The particularity of the Romanian automotive industry is a high concentration of employees in a definite working place, often thousands of them are working together in an 8-hour shift. “The local automotive companies that resumed their production must go through great changes not to jeopardize the health of their employees. Investments are needed to be incurred to guarantee a high degree of personal hygiene, distancing within workplaces, the ability of fast identification of employees at risk, and isolate those who may be infected.”, mentioned Ionuţ Vintilă, Senior Manager, Audit & Assurance, Mazars Romania.

    Certain production processes will be affected and need to be re-designed to comply with the mandatory distancing between employees. Other regulations must be considered when talking about the transport of employees to/from the factory, which are located in rural Romania, the dynamic within factory premises (from the gate to the workplace), as well as the behavior of the employees during breaks. In addition, special

    measures must be taken when securing the supply chain to cope with local and European travel restrictions for imports of raw materials and exports of finished goods. One particularity of this industry, such as the high degree of automation in production, will certainly help to maintain the desired safety distances.

    The automotive companies must be aware that if an outbreak of COVID-19 infection is identified in a plant, then there is a high possibility that the plant will be closed down by health authorities for a long period.

    Next steps and the forced transformation of the automotive industry

    It may take years for the global automotive industry to return to pre-crisis volumes. While a smaller decline in sales compared to the previous year is expected in the second half of 2020, the industry could undergo far-reaching changes.

    According to Dr. Christian Back, Global Head of Automotive at Mazars, “COVID-19 could have a diverse and long-term impact on the global automotive industry”.

    For decades, the automotive industry has focused on optimizing working capital. What was considered optimal in terms of financing and lean management is now being reconsidered by many automotive companies in terms of production capability. Supply chains are strongly controlled by the OEMs and it remains to be seen to what extent the OEMs will now push for greater regionalization of supply chains to reduce dependency on international partners.

    “However, the consequences of global crises and worldwide production lockdowns cannot be solved in this way”, adds Dr. Back. Some OEMs are currently rethinking their procurement strategies: potentially switching from one supplier per component to two or even more. This would make OEMs be better prepared in the case of further production lockdowns and individual supplier shortages.

    The COVID-19 experience could offer new opportunities to the automotive industry. Travelers could again prefer individual travel options, as the use of public transport is associated with a higher risk of infection. Or they could ask for the introduction of new in-car products, such as anti-virus functions as part of the air conditioning system, for instance.

    According to the epidemiologist’s community, it is now more and more clear that we are at the beginning of the COVID-19 pandemic, that could last for years to come. Second and even third waves are expected in Autumn 2020 and Spring 2021.

    Fiscal measures with impact on cash optimization

    If we take a look at the fiscal area, we notice that the evolution of the pandemic has determined governments around the world to take quick measures to support the business environment. The European Commission considers the COVID-19 pandemic to be „an unusual event that is out of the government control”.

    In turn, the Organisation for Economic Co-operation and Development – OECD has proposed to governments and tax administrations packages of measures to mitigate the negative impact of the virus: deadlines postponement for filing tax returns and obligations, suspension of penalties/ default interest, suspension of tax controls or enforcement measures, accelerating VAT refunds.

    „The measures taken by Romania are similar to those implemented by other states affected by COVID-19 and are certainly beneficial to the automotive industry. We can mention here the technical unemployment indemnity, the possibility of postponing the payment of fiscal obligations during the state of emergency when most factories in the automotive sector have closed their doors or the bonus granted for the payment of profit tax for the first quarter of 2020, as well as VAT refunds without control.”, mentioned Alexandru Stanciu, Manager, Tax Advisory, Mazars Romania.

    „Companies must also consider the extent to which they can benefit from the tax facilities already provided by law, such as the additional deduction of research and development expenses when calculating the profit tax, the tax exemption of the reinvested profit or the tax credit related to sponsorships. This is also a good time to identify ways to optimize cash flow. Thus, companies with import operations can apply for a certificate of deferral of VAT payment at customs or for the certificate of the authorized economic operator (AEO), the latter having both an impact on cash optimization (guarantee exemption) and in relation to the customs authorities, offering a privileged status.”, mentioned Bianca Vlad, Partner, Tax Advisory, Mazars Romania.

    We expect an acceleration of the digitization process, including at the level of tax authorities, the implementation of technology proving to be essential within the tax administration at a time when the interaction between authorities and taxpayers is limited by the restrictions imposed by the state of emergency.

  • Staff begin phased return to work at Aston Martin Lagonda

    Staff begin phased return to work at Aston Martin Lagonda

    • Extensive and wide-reaching new safety measures are designed to reduce COVID-19 risk for Aston Martin Lagonda employees returning to work;
    • Staff at St Athan factory lead the way on 5 May; Gaydon to follow in due course;
    • The range of actions being taken exceeds latest Government advice.

    Aston Martin Lagonda is this week beginning a carefully planned phased return to work for a number of its manufacturing staff as the business looks to prudently restart car making while adjusting to the new normal in the nation’s ongoing battle to protect the NHS and overcome the threat of COVID-19. 

    Working closely with the trade unions, Aston Martin Lagonda has developed detailed return-to-work protocols to be followed by employees returning to their jobs at the brand’s manufacturing facility in St Athan, Wales.

    Production workers at the company’s global headquarters in Gaydon, Warwickshire will follow at a later date, as will office and support staff at Aston Martin Lagonda’s various other UK sites.

    The social distancing, health and hygiene instructions cover every aspect of a staff member’s interaction with work from preparing to leave home to arriving on site; navigating the site; breaks and mealtimes; falling ill whilst at work; dealing with visitors and contractors; and leaving the site.

    There is also detailed guidance on PPE management; travel between Aston Martin Lagonda sites; and pool car arrangements.  

    Dozens of individual actions and instructions have been drawn up to support social distancing, with carefully calculated limits on employee numbers on site and working at any given time to support staff actions.

    Appropriate PPE is being provided to all returning staff, for example mandatory use of masks at all time while on site, temperature checks on arrival at work are also being introduced. 

  • Sale of non-food goods significantly decreased due to coronavirus in Czechia

    Sale of non-food goods significantly decreased due to coronavirus in Czechia

    Results for March 2020 were influenced by measures taken to prevent the spread of coronavirus because of which many stores with mostly non-food goods were closed for part of the month or their operation was limited.

    The most significant year-on-year sales decrease (drop by 64.9%) occurred in stores with clothing, footwear and leather goods and in stores with cultural and recreation goods (drop by 47.1%).

    Sales decreased also in retail sale in specialised stores with information and communication equipment (drop by 29.7%) and in retail sale of other household equipment in specialised stores (drop by 22.0%).

    Sales for sale of goods via mail order houses or via Internet increased (+20.8%). Growth of sales was reported also for the sale of dispensing chemist, medical and orthopaedic goods (+9.1%).

    The above mentioned overall growth of sales for food was entirely owing to retail sale in non-specialised stores with food, beverages or tobacco predominating (growth of sales by 5.2%).

    Sales in retail sale of food, beverages and tobacco in specialised stores decreased by 17.3%.

  • Turnover of Austrian retail trade decreased by 29.0% in the non-food area

    Turnover of Austrian retail trade decreased by 29.0% in the non-food area

    In March 2020, the turnover of Austrian retail trade decreased by 12.9% in nominal terms and by 13.7% in real terms compared to March 2019, according to preliminary calculations by Statistics Austria.

    The main reason for this decline is the closure of a large part of the shops due to measures to contain the corona pandemic. In the non-food sector, which was particularly affected, the minus was 29.0% (nominal).

    In the first quarter of 2020, turnover decreased by 1.5% in nominal terms and sales decreased by 2.7%.

    Results were calculated by Statistics Austria, Short Term Statistics Trade.

  • How coronavirus pandemic affected the Bulgarian consumer

    How coronavirus pandemic affected the Bulgarian consumer

    In the conditions of COVID-19, consumers have become more rational and more price sensitive. 41% go to the store only once a week, and 36% even less often as they also admit that they are increasingly looking for bargains and promotions.

    Many of the respondents believe that in the conditions of -COVID-19 they have acquired useful shopping habits and would continue to do so after the end of the state of emergency.

    59% want to think more about their purchases in the future, and 54% say they will continue to buy mainly Bulgarian products.

    81% of Bulgarians want more local products

    According to 81% of them, big chains need to invest more in the economy in Bulgaria by offering more goods produced in the country.

    More than half say they would prefer Bulgarian goods, even if they were at a higher price, and 70% would even change the store from which they shop for another where they can find Bulgarian production.

    87% of respondents indicated that they had complied with the recommendations for social distance and spent Easter at home. More than 70% say they support the state of emergency, but also admit to being concerned about the situation in the country.

    The survey on the Bulgarian consumer behavior trends was conducted by Online Marketing Research Agency JTN.

  • Four consumer behavior trends emerge during the COVID-19 pandemic

    Four consumer behavior trends emerge during the COVID-19 pandemic

    The COVID-19 crisis is being defined by four distinct consumer behavior segments, according to the first edition of the EY Future Consumer Index, a survey of 4,859 people tracking consumer sentiment and behavior across the US, Canada, the UK, France and Germany.

    These are “Cut deep,” “Stay calm, carry on,” “Save and stockpile” and “Hibernate and spend”.

    Consumers that fall into the “Cut deep” segment (27.3%) are spending less across all expense categories as the pandemic impacts employment; others representing the “Stay calm, carry on” category are continuing to spend as normal (26.2%).

    Most consumers (35.1%) represent the “Save and stockpile” segment, indicating that they feel pessimistic about the future, while consumers that fall into the “Hibernate and spend” segment (11.4%) are spending more across the board.

    Cut deep

    These consumers are mainly more than 45 years old and have seen the biggest impact on their employment status. Almost a quarter have seen their jobs suspended, either temporarily or permanently. Seventy-eight percent of them are shopping less frequently, while 64% are only buying essentials. Thirty-three percent feel that brands are far less important to them in the current climate.

    Stay calm, carry on

    These consumers do not feel directly impacted by the pandemic and are not changing their spending habits. Just 21% of them are spending more on groceries, compared with 18% that are spending less.

    Save and stockpile

    This segment shows particular concern for their families and the long-term outlook. More than a third (36%) are now spending more on groceries, while most are spending less on clothing (72%) and leisure (85%).

    Hibernate and spend

    Primarily aged 18-44, these consumers are most concerned about the impact of the pandemic. However, only 40% of this segment say they are shopping less frequently. And while 42% say the products they buy have changed significantly, 46% of them say brands are now more important to them.

    Five new segments may emerge as consumers move beyond the pandemic

    The four segments identified could morph into five very different ones as the crisis abates. For example, the Index currently suggests that over time, most consumers in the “Save and stockpile” segment will migrate to two new segments: “Remain frugal” and “Cautiously extravagant.”

    These new consumer segments, detailed in the Index, could emerge post-COVID-19 and be summarized as: “Keep cutting” (13.1%), “Stay frugal” (21.7%), “Get to normal” (31.4%), “Cautiously extravagant” (24.7%) and “Back with a bang” (9.1%).

  • 70% of employees want to continue working mostly from home

    70% of employees want to continue working mostly from home

    7 out of 10 Romanian employees want to continue to work mostly from home even after easing the measures to prevent the spread of coronavirus and after the state of emergency ends, according to Colliers International.

    Out of these, 60% believe that working remotely would be useful at least 1-2 days a week, and 10% would like to work even 3-4 days from home in the next period.

    Office buildings in the portfolio managed by Colliers International continued to be operational during the state of emergency, with no projects under conservation, so it is expected that activity will be resumed gradually starting May 18th.

    A quarter of employees expect to return to the office in May, but their work in office buildings will resume gradually, depending on the evolution of the coronavirus epidemic and further measures announced by the authorities. At the same time, it is expected that some companies will continue to apply remote working policies for a longer period, at least for employees who have children, in the context of suspending the activity of schools until fall.

    To ensure employees’ social distance within the office, employers need to consider some changes in the set-up of the space and furniture, especially in the case of open space offices. It is necessary to ensure a recommended distance of two linear meters between employees, which means that it will be necessary to increase the space allocated per employee from 8 square meters, which is currently the average in class A office buildings, at over 15 square meters per employee. In this context, some companies will have to allow a percentage of employees to continue working from home, so that the rules on social distance and rotation can be respected.

    New security measures in office buildings

    Measures that can be implemented by companies to prepare their offices for the return of employees include rotating offices from open spaces so that they do not face each other and directing the team to alternative office work areas. At the same time, temporary transparent plastic barriers can be installed in the reception areas to separate visitors from the reception desk, and high partitions can be installed in the offices between facing desks. Last but not least, in conference rooms, after removing a number of chairs, floor markings can be applied to indicate a safe 2 meters distance between seats, Colliers International consultants recommend.

    To reduce touching door handles, the doors of offices and conference rooms should be left open, unless there is an absolute need for privacy. There should also be signs in office buildings informing visitors about the distance rules, hand washing and sanitizing or wearing masks in public areas. Using signage, unique clockwise paths can be created through the space, and by adding arrow tape on the office floor, the recommended direction can be indicated.

    At the same time, building owners will have to regularly ensure complete sanitation of heating and cooling systems and air treatment plants, according to Colliers International consultants, as well as actions aimed to ensure periodic disinfection with an increased frequency and special solutions for sanitary and common areas. To align with the new hygiene rules, owners of office buildings will have an additional minimum cost of 2,000 euros per month for a medium-sized building.

  • How coronavirus changed Romanians’ digital habits in the last month

    How coronavirus changed Romanians’ digital habits in the last month

    • 44% of Romanians pay their utilities invoices online and this is the habit they want to keep after the restrictions of circulations will end too;
    • Aprox. 35% of the respondents work from home;
    • Telemedicine has been adopted by 4% in just six weeks of social isolation, quite a good start.

    Telekom Romania ran a survey to figure how the consumers’ behaviour has changed and what will be the new consuming habits.

    Apps to work from home

    The enforcing of the state of emergency has significantly changed the working ways. According to the survey, over 34.7% of respondents work from home.

    They mainly use Skype to communicate with their teams (22,9% of respondents). The second place in popularity belongs to Zoom application with 20,6% of responses, followed by Microsoft Teams with 11.9%, Google Hangouts with 11.5%, Skype for business with 7.6% and WhatsApp with 5.6%.

    Facebook is the most used social platform

    When we talk about spending time on social networks, Facebook remains the preferred platform for 35.5% of respondents.

    In second place is YouTube (28.9%), then the other applications: Instagram (11.2%), TikTok (6%), Pinterest (4.8%), Reddit (4.7%), LinkedIn (4.2%), Snapchat (3.7%) and Twitter with (2.8%).

    Telecommunications services used in the current context

    The Internet is the most used communications service used by 38.6% of respondents. 34.4% of them use mobile telephony, 24.3% use television service and only 0.7% use fixed telephony.

    These behaviours are also visible in relation to Telekom services and products. In the first 2 weeks of April, the traffic on the telekom.ro site increased by 77%, compared to February of the same year.

    Online payments versus offline payments

    The circulation restrictions have led to the adoption of online payments for utility and service invoices.

    Thus, 44% of respondents pay all bills online, 30.7% online, but also physically, and 25.3% pay them only physically, because, in their opinion, this type of payment gives them security.

    Bare necessity online shopping versus bare necessity offline shopping

    According to Eurostat, in 2019, 23% of the population shopped online, and now even in the current general context, 55% of respondents continue to go shopping in physical stores, taking the protection measures recommended by the authorities, 27,1% made their supplies in time and do not go to the store so often, 25.3% do their shopping in physical stores, but also online and only 7.8% turned exclusively to suppliers to purchase their necessities.

    As a frequency, 43.4% go shopping once or twice a week, 38.5% less than once a week, 6.6% of respondents go shopping every day, 1.4% of 5-6 times a week and 10.1% 3-4 times a week.

    Half of those who responded to the survey mainly use a mobile phone to place an order, 42.2% use a laptop or desktop and only 7.4% use a tablet.

    The activities of spending time at home

    Among the activities at home, the online survey revealed that in the current general context: 72% of respondents said they spend their free time with family activities, 58% watch TV series and movies, 31% learn new things, 23% do sports at home, 11% run in the vicinity of the house and 7% have other activities.

    Medical non-emergencies

    A premiere that confirms the global trends is the gradual adoption of telemedicine, with 4% of respondents saying they use this way of caring for their personal health.

    For non-medical emergencies during this period, 61,1% of respondents said they use the advice of a family doctor, 23.9% wait until the restrictions are lifted to go to the doctor, 14.2% call the approved phone numbers, 11.8% use the medical application on the phone, 5.5% take protective measures and go to the hospital.

    Which of the digital habits do the Romanians intend to keep

    The respondents to the online survey also stated which are the digital habits they want to keep after the relaxation of the circulation restrictions: online payment of bills is also the digital habit that most Romanians would like to maintain in the future. (59% of respondents), followed by online shopping (42.7%) and 24.5% would like to keep in touch with doctors remotely (through applications or telemedicine).

  • Slight improvement on impact of Covid-19 on real estate markets

    Slight improvement on impact of Covid-19 on real estate markets

    In its latest global sentiment survey among its researchers around the world of the impact of Covid-19, Savills says that the outlook has improved slightly, with 19% of countries reporting a severe negative impact on their real estate markets due to the pandemic – an improvement compared to 29% in its previous survey.

    Sentiment in China is now ”slightly positive”. China has seen some real estate activity resume as infection rates have been brought under control: retail and office leasing activity rose moderately in the first half of April.

    Utilisation rates have also increased as more offices and shops are open with people in them, although rates remain below normal levels as social distancing continues. South Korea and Vietnam, also benefitting from rapid decreases in infection levels, both reported ”neutral” market sentiment.

    Rental values

    Rents remain unchanged across 60% of sectors and countries globally, rising to 71% of countries in the case of offices, supported in part by the extensive use of concessions.

    Retail tenants have been the greatest beneficiaries, with 80% of countries reporting retailers receiving some form of rent relief. Deferred service charges and changes in payment structures are the next most common, with 40% of countries reporting their use by retail landlords in each case.

    Occupier demand

    Occupier demand altered virtually overnight in many markets. But with early indications that many countries are now at the peak of the epidemic, signs of stability can be seen in some sectors.

    Demand for offices is reported to be stable in 42% of countries, while 55% reported moderate falls in occupier demand. This is a significant improvement from the 70% that reported moderate falls at the end of March.

    Capital markets

    The survey indicates that transaction volumes are down but no longer falling as sharply as in March. In the first half of April, 44% of countries noted no change in transaction volumes.

    In the office market, nearly half of the countries surveyed reported no change in transaction volumes since the end of March, whereas earlier 73% of countries were reporting moderate or severe declines in volumes.

    Capital values

    Capital values continue to be largely unaffected with 63% of countries surveyed reporting values in their markets to be unchanged, albeit on thin volumes.

    Unsurprisingly, logistics and healthcare continue to fare well, with 87% and 95% of countries respectively reporting unchanged or increased capital values.

    Both sectors will continue to be in high demand for the foreseeable future, which should help support values. Over two-thirds of countries report offices and residential capital values to be unchanged.

    Government assistance

    Government intervention, such as reduced property taxation or temporary bans on evictions, were reported in 59% of the countries surveyed.

  • 1.2 billion fewer international air travellers by September 2020

    1.2 billion fewer international air travellers by September 2020

    Compared to “business-as-usual”, by September 2020 international air passenger totals could drop by as many as 1.2 billion travellers according to the latest projections from the International Civil Aviation Organization (ICAO). 

    Its estimates also show that international capacity could drop by as much as two-thirds from what had been forecast for the first three quarters this year, leading airline revenues to drop by as much 160 to 253 billion dollars for the January to September period. 

    Europe and the Asia-Pacific will be hardest hit by the capacity and revenue impacts, followed by North America. Similarly, the most substantial reduction in passenger numbers is expected to be in Europe, especially during its peak summer travel season, followed by the Asia-Pacific. 

    “As overall severity and duration of the pandemic are still uncertain, ICAO has developed six different recovery paths under two indicative scenarios to explore the potential short-term economic implication of the COVID-19 pandemic,” advised ICAO Secretary General Dr. Fang Liu in a message to Representatives of ICAO’s Member States.