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Pope Francis has officially gone electric, with Mercedez-Benz delivering the first-ever battery-powered popemobile to the Vatican – a reworked version of the G-Class SUV, bathed in white with special tweaks for lots of handwaving to the crowd. Check it out.

For the first all-electric popemobile, the German automaker reworked its G-Class SUV, with changes including using four electric motors at each wheel to carefully control the vehicle at the low speeds the pope travels when making public appearances. There is also a dedicated open-air seating area with a comfy, all-white height-adjustable 360-degree swivel seat so the pope can sit higher while waving to the crowds. A removable top protects the pope from the elements, but interesting in this popemobile, we don’t see any glass-encased side panels. Of course, in keeping with tradition, the electric G-Class SUV has a pearly white exterior and interior.

“This is a special honor for our company, and I would like to thank His Holiness for his trust,” Mercedez-Benz group CEO Ola Källenius said in a statement. “With this Popemobile, we are also sending out a clear call for electromobility and decarbonization. Mercedes-Benz not only stands for the special and individual — but also for consistently creating the conditions for a net-carbon-neutral new car fleet in 2039.”

Mercedes-Benz has a long history of building popemobiles for the Vatican, with the automaker having built around one-third of all such pope-carrying vessels over the past 100 years. Mercedes said it has been building the electric-powered version for around a year. This version, dubbed the G 580, also comes with a 116-kWh battery, with a 10-80% charge time of just 32 minutes – which should give plenty of ride time at slow speeds, and relatively quick recharges won’t keep the pope waiting too long.

Mercedes isn’t the first company that has aimed to electrify the pope’s ride. The now-defunct EV startup Fisker had made potentially dubious claims that it was working on an emission-free Vatican version of its Ocean SUV for the pope, but the company went bankrupt earlier this year.

The Vatican also announced that it would be gradually transitioning its existing cars with electric ones for an all-EV fleet by 2030. Last month, VW stated it will be the chosen partner to advance the plan, with the automaker delivering just under 40 fully electric vehicles starting next year, including the ID.3, ID.4 electric SUV, and ID.5.

For the new Mercedes-Benz popemobile, it could be better suited for the use case involved – short, slow local trips with a lot of stops among crowds. The pope gets to enjoy a silent, emissions-free electric ride, and the crowds won’t have to choke on fumes as he cruises by. Win-win.

Number of people caught in 60 per cent ‘tax trap’ up 45% in two years

Rise for taxpayers earning more than £100,000 blamed on frozen tax thresholds and wage inflation

The number of individuals being taxed at 60 per cent on part of their earnings has risen by almost half in two years, new figures seen by the Financial Times show.

The numbers, revealed by a freedom of information request to HM Revenue & Customs, showed that in 2023-24, 634,000 taxpayers were estimated to fall into the 60 per cent bracket — up 45 per cent from 436,000 in 2021-22.

Since 2010, those earning more than £100,000 a year have had their personal allowance tapered away until it is completely eliminated for earnings over £125,124.

The tax-free personal allowance has also been frozen at £12,570 since April 2021, with Chancellor Rachel Reeves maintaining the freeze in place until 2028 in the Budget.

This means that for every £2 earned above the £100,000 threshold, £1 of the allowance is removed — leaving taxpayers within the £100,000-£125,124 bracket facing an effective rate of 60 per cent on that part of their income.

Bowmore Financial Planning, which requested the information from HMRC, said frozen tax thresholds and wage inflation — measured at 5.5 per cent by the Office for National Statistics in January 2024 — were responsible for the rise.

The combination, known as fiscal drag, pushes those with rising incomes into tax brackets they would previously have not reached.

Mark Incledon, chief executive of Bowmore Financial Planning, said the number of taxpayers “falling victim to this notorious tax trap was already incredibly large,” but that hundreds of thousands more people were now in this position.

“The long-term effect of leaving the tax trap issue unresolved is that it disincentivises hard work. People are far less likely go the extra mile and push for promotion if they think they won’t feel the reward for extra effort,” he added.

To avoid being hit by the rate, some individuals may opt for salary sacrifices or further pension contributions. But Dan Neidle, founder of the Tax Policy Associates think-tank, said these were often “unattractive” alternatives.

“For many, this means working more hours and harder for a return they won’t see for decades,” he said.

He added that it was “amazing” so many people had been hit by a “political gimmick designed to raise tax without raising headline rates”.

“The Conservatives don’t want to admit the problem they created, and Labour doesn’t want to be seen to care about people earning £100,000. If I was a chancellor obsessed with growth, I’d be looking very carefully at [the problem],” he concluded.

John Cassidy, a partner at tax advisers Crowe, echoed concerns that the rate was a disincentive to growth. He added that the fear of being hit by the band was leading some small business owners to divert their salary elsewhere.

“Say a spouse is employed so husband and wife can split the income and keep each person below £100,000,” he said. “Their role may be minor, yet generates a large salary diverted from the other spouse.”

The figures, which show the number of taxpayers estimated to be within the 60 per cent bracket has risen continually since 2018-19, are predicted to increase.

Previous reporting by the FT showed that the number of people who were estimated to lose all of their personal allowance would exceed 1mn by 2027-28.

An HM Treasury spokesperson said: “We are committed to keeping taxes low for working people, which is why we protected payslips from tax rises and are not extending the freeze on personal tax thresholds past 2027-28.”

Private equity group explores potential listing of Norwegian company as early as 2026

Hg is considering a potential flotation of €19bn software company Visma, as the private equity group approaches two decades of ownership of the Norwegian business.

Visma, which provides small and medium-sized businesses with accounting and payroll software, was acquired by Hg in 2006 for an estimated $500mn and employs almost 16,000 people, with an annual revenue of €2.4bn.

Hg is discussing a potential initial public offering of the business as soon as 2026, with listing options to include London, Amsterdam and Oslo, according to several people familiar with the matter.

A flotation would return Visma to the public markets after Hg led its delisting from the Oslo Stock Exchange in 2006. The private equity group has been the lead or minority investor in the company ever since.

Hg and its co-investors at present own about 70 per cent of the company, alongside several minority shareholders including the Singaporean wealth fund GIC, the US private equity group TPG, the UK’s ICG and others.

Visma had previously considered pursuing an IPO as early as 2023, the people said, but ultimately opted for a private share sale to investors including Jane Street and Altaroc in a transaction valuing it at €19bn.

Hg is now planning for Visma’s next liquidity event, the people said, with options including a flotation or share sales to other private investors. Hg and Visma declined to comment, and the people stressed no decision had yet been made.

The talks come after Visma reported a 17 per cent rise in third-quarter revenues to €694mn, and earnings before interest, taxes, depreciation and amortisation of €256mn, an increase of 26 per cent year on year. The bulk of its revenues come from the Nordic region, though its operations span 33 countries.

A Visma IPO would be among the largest in Europe in recent years and would take place in a market that is still recovering from a prolonged slowdown.

Amid a dearth of IPOs, other buyout groups such as EQT have explored private stock sales for portfolio companies in the private markets. The Swedish investment group is weighing plans to sell a minority stake in its €15bn software group IFS in which Hg is also a minority shareholder.

Hg has used a similar approach for other companies such as its cloud software provider Access Group, which it owns alongside TA Associates. Access Group announced in June 2022 that it had received further funding at a £9.2bn valuation after Hg first invested as a minority shareholder in 2018 at about a £1bn valuation.

Meta to Farm Out Design for Mixed Reality Devices, Shift Some Production From China

The Takeaway

•Meta has started outsourcing some design for mixed reality devices to its manufacturer Goertek in China

•Previously, Meta handled design of its devices and Goertek handled manufacturing

•Meta is working with Goertek to move half of the Quest manufacturing to Vietnam from China

Meta Platforms is changing how it designs and where it builds its mixed reality devices to stem deep financial losses and skirt a possible trade war between the U.S. and China.

Meta is shifting part of the development and design of its mixed reality headsets to Chinese contract manufacturer Goertek, according to an employee at Goertek and two employees at Meta. The Facebook-owner is also working with Goertek to move up to half the manufacturing of Quest headsets to Vietnam from China over the next several years, the Meta employees said.

Previously, Meta designed the Quest headsets, and Goertek made and tested them. As the Quest’s only manufacturer, Goertek’s deeper involvement in developing Meta’s products could help the Chinese company improve its hardware design capabilities. That could be politically sensitive for Meta, though, because it could involve transferring technology and design expertise to a Chinese company amid increasing tensions between the U.S. and China.

Over time, Meta wants to shift more of the design of components such as lenses and displays to Goertek, as the technology for mixed reality devices becomes more widely available. By 2030, Meta hopes Goertek and other potential manufacturers will fully develop its mixed reality headsets as original design manufacturers, according to one of the Meta employees.

This would allow Meta to reduce its role in developing mixed reality hardware and focus on the more profitable software business, according to the Goertek and Meta employees. For example, Meta would promote the use of its Horizon OS operating system on these devices, similar to how many smartphone makers use Google’s Android operating system for their devices.

“We work with [Goertek], of course, but we design our headsets as we always have,” a Meta spokesperson wrote in an email, without commenting on Meta’s plan to shift half of Quest manufacturing to Vietnam. Goertek didn’t respond to an emailed request for comment.

President-elect Donald Trump has said he plans to increase tariffs on goods coming to the U.S. from China. But even before the election, Goertek had already been planning to move some production of Quest headsets to Vietnam, as U.S.-China tensions escalated, the Goertek employee said.

The move could help Meta dampen the impact of a potential trade war between the U.S. and China. The government of Vietnam announced in October that Meta’s cheaper Quest 3S headset will be manufactured in the country beginning next year. Goertek already assembles many of Apple's AirPods and HomePods in Vietnam.

Until now, Meta has designed its Quest headsets to showcase what’s possible with the technology and to kick-start sales of the devices. It has been selling the headsets at a loss and burning billions of dollars on product development. Meta’s Reality Labs unit, which includes its virtual and augmented reality devices, has cumulatively lost nearly $64 billion since 2019, according to company statements.

As the metaverse has lost favor within the company and among investors, Reality Labs’ hardware teams have been asked to cut spending by almost 20% between this year and 2026, and the unit earlier this year laid off some directors and vice presidents working on hardware, The Information previously reported.

Meta’s plan for building consumer hardware was initially similar to that of Apple, which tightly controls the design of its products and outsources their assembly to companies mostly located in China. Like Apple, Meta sought to own the technologies inside the headset and differentiate itself from competitors by funding teams responsible for designing key components such as chips.

However, Meta has gradually reversed course and cut its spending on Reality Labs, laying off thousands of employees in the unit over the past two years and reducing the scope of some teams. Last year, it laid off most of its chip team and turned to Qualcomm and Mediatek to supply chips for its future products.

Joint Design

The Meta-Goertek relationship is now akin to joint design manufacturing, where Meta tells Goertek its goals and requirements for its devices, Goertek proposes multiple options and Meta chooses from them, the Goertek employee said.

In a sign of their deepening partnership, Meta has started sharing more information with Goertek about prototypes, including a successor to augmented reality glasses Meta demonstrated in September, the Goertek employee said. If it all goes well, Goertek could one day take over the design of the AR glasses, the same employee said.

In the new relationship, Goertek handles more of the electrical engineering for Meta’s devices, including tasks such as how to connect chips with sensors within a device, according to the Goertek employee. Goertek has also started designing the outer shell for future versions of Meta’s mixed reality headsets, according to one of the Meta employees.

Goertek is also playing a larger role in research and development for other Meta devices such as the Ray-Ban smart glasses, according to one of the Meta employees. Meta has met with R&D staff at Goertek to understand their capabilities, a Goertek employee said. Carmine Arabia, Reality Labs’ vice president of devices, visited Goertek’s R&D headquarters in Qingdao, eastern China earlier this year, according to the same employee.

In recent months, Goertek has substantially grown its team dedicated to Meta, the Meta and Goertek employees said. Meta recently laid off some employees working on hardware in Shanghai and Shenzhen, and Goertek is recruiting some of them, the Goertek employee said. Some Meta contractors are also shifting to Goertek, including those involved in testing and manufacturing, according to one of the Meta employees.

The U.S. experienced two thirds of the insured losses

Estimated global insured losses from natural catastrophes like hurricanes and floods are on track to exceed $135 billion in 2024, according to a report from the Swiss Re SREN -0.19%decrease; red down pointing triangle Institute.

The research arm of the Swiss reinsurance firm said Thursday that 2024 is set to be the fifth consecutive year with losses from natural disasters and severe weather surpassing the $100-billion mark.

The growing loss burden was mainly driven by the concentration of value in urban areas, economic growth and rising rebuilding costs, Swiss Re said, noting that climate change is playing an increasing role in the losses.

The U.S. experienced two thirds of the insured losses, with Hurricane Helene and Hurricane Milton resulting in damages approaching $50 billion.

Europe and the Middle East were hit by major floods and saw insured losses of close to $13 billion. Of those, $10 billion were attributed to Europe, Swiss Re said. In Central Europe, floods caused by storm Boris hit the Czech Republic, Poland and Austria and also affected parts of Slovakia, Romania and Italy, it said.

“Economic development continues to be the main driver of the rise in insured losses resulting from floods, but also other perils, seen over many decades,” Swiss Re’s Group Chief Economist Jerome Jean Haegeli said. “With natural catastrophe risks rising and higher price levels, the annual increase of 5%-7% in insured losses will continue.”

The figures highlight the need for adaptation as well as an adequate insurance coverage, Haegeli said.

Initiative is open to UK and would tap bond markets to boost spending for Trump’s White House return

EU countries are discussing a €500bn joint fund for common defence projects and arms procurement, tapping bond markets to boost spending in anticipation of Donald Trump’s White House return.

Trump’s threat to withdraw US security guarantees from underspending Nato allies has spurred European capitals to explore more radical defence funding options, including joint borrowing that has traditionally been ruled out by fiscal hawks in Germany, the Netherlands and Denmark.

Senior European officials discussing the plan are now focused on setting up a financing vehicle for defence, which would issue bonds backed by national guarantees from participating countries rather than the EU as a whole.

The financing model, which would be open to non-EU states such as the UK and Norway, is gaining traction among a key group of EU member states, six people involved in the talks told the Financial Times. While the precise borrowing target is still to be agreed, those involved in negotiations said it would need to be more than €500bn.

Europe has long been wrestling with how to step up defence spending to both sustain support for Ukraine and prepare for the US president-elect Trump, who earlier this year warned “we’re not going to protect” Nato allies “if they are not going to pay”.

The EU has explored myriad ways to finance additional projects, and the intergovernmental fund has emerged as the single most ambitious option under consideration.

The plans have been raised with the UK but London has yet to commit to any involvement, according to European officials involved in the discussions. One senior British official aware of the initiative welcomed the ambition as an “encouraging” sign of resolve.

The European Investment Bank would be asked to play a technical role, helping to administer the special purpose vehicle (SPV) and manage treasury functions.

Unlike the past proposals to issue “Eurobonds” for defence — joint borrowing that fiscally conservative EU countries opposed — participation in the fund would be voluntary and open to non-EU states.

EU restrictions on using common funds for military purposes would therefore not apply, and military-neutral member states such as Austria, Malta, Ireland and Cyprus would be able to opt out without vetoing the plan.

Greek Prime Minister Kyriakos Mitsotakis, who championed Eurobonds for defence earlier this year, told the FT there was a shift in sentiment among EU leaders. While his proposals were initially met with a “lukewarm response”, Mitsotakis now sensed “a renewed sense of urgency” given Europe’s security challenges and Trump’s return to power.

“There is a growing consensus that we need to spend more on defence, and perhaps it’s time to establish a joint European mechanism to finance projects of common interest,” he said.

“Germany and France would obviously benefit from more European spending on defence,” Mitsotakis said, adding that Italy and Spain are also “big players” in the industry that stand to gain from this initiative.

Poland’s deputy finance minister Pawel Karbownik also said that “Europe has no other choice” than to increase its defence investments. “We need to be able to defend ourselves in the worst-case scenario,” he told the FT.

“Trump 2.0 is likely to act as a catalyst for the EU to do more for Ukraine, as well as for its own security and defence,” said Mujtaba Rahman of Eurasia Group.

Under the new plans, the EIB would help manage national guarantees underpinning the SPV and play an administrative role in capital markets, the people involved in the talks said. Under its current lending policy, the EIB is banned from directly funding arms investments. A spokesperson for the EIB said: “We have not been seized of any such plans.”

The Netherlands, Finland and Denmark are broadly supportive of the idea, the people familiar with the discussions said. Germany’s stance is uncertain and will depend on its federal elections in February.

“We are in very well-advanced discussions,” said one senior EU diplomat involved in the talks. “But it is still not clear exactly how Berlin sees it.”

Talks are continuing about the size of the fund but the goal is to raise at least €500bn, a figure European Commission president Ursula von der Leyen has told leaders will be the minimum required over the next decade to meet the continent’s security needs, five of the people said.

The money could be used to support joint defence projects, such as common air defences that Poland and Greece have proposed and which alone would cost €500bn, according to EU defence commissioner Andrius Kubilius.

Brussels hopes funding for joint arms purchases will spur defence contractors to make long-term investments. But there remains much to be resolved over how the funds will be used.

“We’re not opposed to providing more money for defence,” said one senior official involved in the discussions. “[But] the priority needs to be defining exactly what this will be spent on.”

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