SHARE
COPY LINK

ECONOMY

Audi withdrawal sinks German America’s Cup chances

Car manufacturer Audi has withdrawn from sponsorship of Team Germany, effectively ending the German sailing team's bid to win the America's Cup, but co-ordinator Jochen Schümann insisted Sunday he will fight on.

Audi withdrawal sinks German America’s Cup chances
Photo: DPA

“I will not give up on the German flag,” triple Olympic champion Schümann told daily Die Welt am Sonntag as the search begins for a new main sponsor.

Audi have withdrawn their financial backing due to the world economic crisis, leaving the sailing team’s dreams of America’s Cup success in tatters.

Team Germany challenged for the Cup in 2007 and Schümann, who was part of the successful Cup campaigns with Alinghi in both 2003 and 2007, joined shortly after the Swiss team beat Team New Zealand in Valencia in July 2007.

Schümann was given the bad news last week that Audi had withdrawn as main sponsors.

“We wanted to meet with Audi last week, however I got a call the night before saying there was now no need to come,” said Schümann.

Schümann has already withdrawn Team Germany from next February’s Pacific Series event in Auckland for America’s Cup yachts.

Alinghi plan to hold the 33rd edition of the world’s oldest yachting competition in 2010 and have set December 15 as the deadline for teams to register for the competition.

But there remains one unresolved issue: the fate of the American Oracle-BMW Racing team, who have taken their argument that the new race format favours Alinghi to the Court of Appeal in New York.

Their case is to be heard on February 10 next year.

ECONOMY

German consumer prices set to rise steeply amid war in Ukraine

Russia's war in Ukraine is slowing down the economy and accelerating inflation in Germany, the Ifo Institute has claimed.

German consumer prices set to rise steeply amid war in Ukraine

According to the Munich-based economics institute, inflation is expected to rise from 5.1 to 6.1 percent in March. This would be the steepest rise in consumer prices since 1982.

Over the past few months, consumers in Germany have already had to battle with huge hikes in energy costs, fuel prices and increases in the price of other everyday commodities.

READ ALSO:

With Russia and Ukraine representing major suppliers of wheat and grain, further price rises in the food market are also expected, putting an additional strain on tight incomes. 

At the same time, the ongoing conflict is set to put a dampener on the country’s annual growth forecasts. 

“We only expect growth of between 2.2 and 3.1 percent this year,” Ifo’s head of economic research Timo Wollmershäuser said on Wednesday. 

Due to the increase in the cost of living, consumers in Germany could lose around €6 billion in purchasing power by the end of March alone.

With public life in Germany returning to normal and manufacturers’ order books filling up, a significant rebound in the economy was expected this year. 

But the war “is dampening the economy through significantly higher commodity prices, sanctions, increasing supply bottlenecks for raw materials and intermediate products as well as increased economic uncertainty”, Wollmershäuser said.

Because of the current uncertainly, the Ifo Institute calculated two separate forecasts for the upcoming year.

In the optimistic scenario, the price of oil falls gradually from the current €101 per barrel to €82 by the end of the year, and the price of natural gas falls in parallel.

In the pessimistic scenario, the oil price rises to €140 per barrel by May and only then falls to €122 by the end of the year.

Energy costs have a particularly strong impact on private consumer spending.

They could rise between 3.7 and 5 percent, depending on the developments in Ukraine, sanctions on Russia and the German government’s ability to source its energy. 

On Wednesday, German media reported that the government was in the process of thrashing out an additional set of measures designed to support consumers with their rising energy costs.

The hotly debated measures are expected to be finalised on Wednesday evening and could include increased subsidies, a mobility allowance, a fuel rebate and a child bonus for families. 

READ ALSO: KEY POINTS: Germany’s proposals for future energy price relief

In one piece of positive news, the number of unemployed people in Germany should fall to below 2.3 million, according to the Ifo Institute.

However, short-time work, known as Kurzarbeit in German, is likely to increase significantly in the pessimistic scenario.

SHOW COMMENTS