Europe began the week with a brutal note.
Policymakers have chosen survival above ambition, from Whitehall’s belt-tightening through to Paris finally forcing a budget out of gridlock.
The markets are breathing out, but for a short time. Tesla’s European damage to its brand looks structural and not cyclical. Wall Street is also regaining control of the once frothy trade in obesity drugs.
The bulletin is designed to cut through the clutter on autos, jobs, politics and biotech. Momentum is declining, sacrifices are being made, and hope is becoming more expensive.
UK Treasury cuts 300 jobs with PS100k as exit incentive
Rachel Reeves, Finance Minister, is aiming to eliminate 300 Treasury positions, or 14% of its 2,100 employees, through a voluntary departure scheme that offers up to PS100,000. ($136.790).
According to a Financial Times report, Treasury, which grew to a record-breaking size due to Brexit and Covid’s chaos, has now returned to its normal level.
The maximum compensation is 15 months of pay, or three weeks per year.
By late February, up to 200 candidates will know their compensation package. If voluntary resignations are not forthcoming in London, Darlington Norwich and Edinburgh, redundancies may be considered.
These cuts are part of a larger government effort to reduce Whitehall administrative costs by 16% between now and 2030. This is a result of Starmer’s drive for efficiency.
After months of political impasse, France has finally agreed on a budget for 2026
The government of Prime Minister Sebastien lecornu finally secured the French budget for 2026 on Monday, after two motions of no confidence failed. This ended nearly two years’ legislative gridlock.
It was the Socialists who won the day. They were able to stop an unpopular pension law that raised the retirement age from 60 years old to 64 and postponed it until 2027, after the presidential elections.
Budget targets a deficit of 5% in 2025 compared to 5.4% today. Spending will be cut by 9 billion euro while taxes are raised on high-income earners and wealth.
The market relief is palpable: French borrowing rates versus German debt have reverted back to levels seen before the snap elections in June 2024.
Alain Duhamel, a political analyst, called it “a victory for politics and a setback for economics.”
Macron’s approval rating is at an all-time low, and he has a little breathing space before the spring of 2027. But real economic reform is on hold as legislators prepare for elections.
Tesla’s European collapse deepens
Tesla’s European problems worsened as the registrations plunged 44% in five of its major markets in January, which confirms a brutal annual decline in 2025.
France’s sales fell to 661 cars, the lowest in three years, while Norway, Tesla’s only European shining star, plummeted 88%, dropping from 154 vehicles on Jan. 1, as tax incentives changed.
Sweden and Denmark have made modest gains, but are still far behind their 2024 levels.
Three factors are responsible for the crisis facing American automakers: Product fatigue (old Model Y line-up), Brand toxicity (Musk’s endorsements of political causes alienated EU environmentalists), as well as relentless competition by Volkswagen and Chinese giant BYD.
It’s a sly trick: EV registrations across the industry jumped by 30% between 2025 and 2030, but Tesla saw its share fall, signaling a market decline rather than EV category weakness.
Each cycle is accelerated by three consecutive years. It’s not cyclical. This is structural damage to the brand.
The obesity boom is real
Wall Street’s fantasy of $150 billion in obesity drugs is crumbling.
Goldman Sachs has slashed its peak predictions to just $105 billion from $130 billion. Jefferies cut even further to $80 billion as the aggressive pricing of Novo and Lilly’s GLP-1 medications, which now begin at $149-299/month for corporate sites, instead of $1,000 on list, undermines their blockbuster forecasts.
Some analysts have shifted their 2030 goal to 2035 as a result of the launch of generic Ozempic and Wednesday’s quarterly results from both companies.
Lilly’s revenue is expected to increase by 21%, while Novo’s sales are likely to decline in 2026.
This is the tortured hypothesis: Massive volume growth has to offset price cannibalization. But prescription momentum (as of late January, 730,000 Rx per week) barely changed. Wegovy +4% and Zepbound +0.9%.
HSBC’s Rajesh Kumra says that if oral medications are launched in 2026, they could prolong therapy, but without accelerating the pace, “consensus stands on thin ice”.
The post Europe Bulletin: UK Job Cuts, France Breaks Gridlock, Tesla’s Spiral Fall may change as new developments unfold.
