The Drum’s Daily Briefing: Getir gets out of UK, Premier Inn shifts focus & WeWork deal
Our quickfire analysis of the brand, marketing and media stories that might just crop up in your meetings and conversations today.
Premier Inn owner shifts focus away from restaurants
Getir pulls out of the UK
Grocery delivery brand Getir is to pull out of the UK, Germany, the Netherlands and the US to focus on its home market of Turkey amid heavy competition and waning demand for rapid home deliveries.
This retreat comes after Getir cut more than 10% of its workforce – some 2,500 jobs – in 2023 and pulled out of France, Spain, Italy and Portugal as the cost of living crisis dampened demand for grocery deliveries in less than 20 minutes, while its own costs have also gone up.
The closure marks the latest shakeout of the fast grocery delivery industry, which grew rapidly during the Covid pandemic but has sharply retreated since.
Getir said it would retain its US arm FreshDirect, which it bought only a few months ago, and said the closures only affected 7% of sales.
Set up in 2015, Getir grew into one of the largest of more than a dozen delivery app companies, promising to deliver groceries in minutes and offering hefty discounts to attract customers.
BYD profits fall as EV car wars escalate
Profits and sales at BYD, the Chinese electric car brand, have fallen, mirroring the downward sales spiral at rival Tesla as demand for electric vehicles continues to slump.
BYD made $630m (£502m) in the first three months of the year, some 47% lower than the previous quarter. In the same period, BYD sold just over 300,000 battery-only cars, down from a record 526,000 in the final quarter of 2023.
Reacting to the blow of softer demand in China, BYD has also been looking to expand into new markets and exported 240,000 cars in 2023 and is looking to grow that number significantly in 2024.
However, that aggressive push into overseas markets has sparked a backlash in the US and Europe as governments look to protect their domestic car makers.
Premier Inn brand owner shifts focus away from restaurants
The Premier Inn brand owner Whitbread is to cut around 1,500 jobs across the UK amid plans to slash its chain of branded restaurants by more than 200 to focus on building more hotel rooms instead.
Whitbread made the announcement after its latest financial report showed strong sales in Premier Inn hotels, while its food and beverage section – which includes Beefeater and Brewers Fayre – has dropped two percent in sales.
The restaurant division has dragged since the pandemic - likely due to the energy-led cost of living crisis - which led to customers spending less.
Other restaurant brands owned by the hospitality business include Back + Block, Thyme Bar & Grill, Table Table and Cookhouse + Pub.
Whitbread plans to sell 126 of its less profitable branded restaurants, with 21 sales already completed. It will also convert 112 restaurants into new hotel rooms.
Dominic Paul, Whitbread’s chief executive, said: “We recognize that our transition will impact some of our team members, so we will be providing support throughout this process and we are committed to working hard to enable as many as possible of those affected to remain with us.”
ChatGPT to be trained on FT journalism
Microsoft-backed OpenAI has struck a deal with the Financial Times that grants it access to the newspaper’s archives to train its artificial intelligence.
Though specifics of the partnership remain undisclosed, the FT will receive compensation for its content while jointly developing AI features.
The deal means ChatGPT users will be able to access summaries from FT journalism, as well as links to articles, in response to queries to the ChatGPT chatbot.
WeWork ownership wrangle goes on
It looks like WeWork founder Adam Neumann is to fail in his bid to regain ownership of the shared office space provider after it announced a settlement with its junior creditors and a new cash infusion from its senior lenders to move ahead with a bankruptcy deal that rejects a $650m offer from Neumann.
During a hearing in Newark, NJ, US bankruptcy judge John Sherwood approved the New York-based, SoftBank-backed company’s sending its restructuring plan to a creditor vote, putting it on track to exit bankruptcy by the end of May.
The restructuring, now supported by all of WeWork’s major creditors, would hand the company’s equity to its senior lenders and cancel its $4bn in debt.
Neumann and his new company, Flow Global, have argued that WeWork is selling its equity to “hand-picked” insiders instead of trying to get the highest bid. His attorneys say that the $450m provided by WeWork’s lenders was really a sale of the company’s equity disguised as a bankruptcy loan.
Transformative HSBC Boss quits unexpectedly
Global bank brand HSBC is to lose its group chief executive, Noel Quinn, who unexpectedly announced his retirement after five years in the role.
Europe’s largest bank says it is in the process of finding a successor for the 62-year-old who will stay in the role until a new CEO is named.
The retirement comes as the UK-based lender reported a 1.8% drop in profit for the first three months of 2024, compared with the same time last year; however, the bank said pre-tax profit for the period was $12.7bn (£10bn), which was a little better than expected by market analysts.
“[Quinn] has driven both our transformation strategy and created a simpler, more focused business that delivers higher returns,” HSBC’s chairman Mark Tucker said.