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Germany’s Merz fails to become chancellor in embarrassing parliamentary defeat

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CNN
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Germany’s Friedrich Merz has failed to win an initial parliamentary vote that would have confirmed his ascension to chancellor, an unprecedented and unexpected twist that extends political uncertainty for the country.

Merz, who won an election in February and unveiled a ruling coalition last month, fell six short in a vote on Tuesday by lawmakers that had been expected to be a formality.

He is expected to eventually find a path to power, but the result pitches Germany into yet more political chaos. February’s vote started a weeks-long period of politicking and negotiating, during which the country’s establishment was buffeted by attacks from the insurgent far-right AfD party and from the increasingly intrusive Trump administration.

Germans had expected that Tuesday’s parliamentary vote would quell that uncertainty. Instead, it ripped open new problems. Only 310 lawmakers voted to approve Merz, just short of the 316 required. The Bundestag now has two weeks to approve Merz, and the AfD pounced on the setback to call for entirely new elections.

Merz’s Christian Democratic Union (CDU) won February’s election, but failed to pick up enough seats to govern outright – an outcome that is commonplace in Germany’s diverse political environment.

He last month announced he would form a coalition with the center-left Social Democrats (SPD), a rare fusing of Germany’s two establishment groups that ensured the AfD – which came second in the February poll – would remain locked out of power.

But Tuesday’s vote reveals deep unhappiness within either or both of those blocks about the deal. Merz had hoped to inject some calm into the country with trips to Paris and Warsaw in the coming days. Now, he will be forced to whip support for a fresh parliamentary vote, expected later this week.

German lawmakers vote secretly, so it is difficult to pinpoint exactly where support for Merz collapsed. But even if he eventually prevails, the vote ensured Merz will start his chancellorship on the back of a monumental embarrassment.

German stocks fell further after Merz failed to be elected, although they later recouped some of those losses. The country’s benchmark DAX index was last 1.1% lower on the day.

“The result of today’s vote serves as a reminder of how narrow the majority of the new coalition is, which further dampens hopes for sweeping economic reforms,” Germany’s Commerzbank said in an economic briefing.

And German economist Holger Schmieding described it as “a bad surprise.”

“The unprecedented failure to be elected in the first round would still be a bad start” for Merz, Schmieding said. “It shows that he cannot fully rely on his two coalition parties.”



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DoorDash to buy Britain’s Deliveroo for nearly $4 billion to expand its reach in Europe

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US meal delivery firm DoorDash will buy British rival Deliveroo for £2.9 billion ($3.9 billion), the companies said Tuesday, as they look to expand their reach and take on competition.

The acquisition will help DoorDash grow its market share in Europe, competing against Just Eat and Uber Eats. Britain and Ireland are Deliveroo’s largest market, accounting for 62% of the value of its orders in its latest quarter. Deliveroo’s other large markets include France and Italy.

The companies rekindled talks last month after DoorDash approached Deliveroo with a 180 pence per share proposal, which was confirmed Tuesday as the final offer, sending Deliveroo shares up about 2% to 176 pence per share.

DoorDash said it would not increase its offer, but reserved a right to do so if a third party emerged with a competing offer for Deliveroo.

Deliveroo’s shares have struggled since their debut when they were sold at 390 pence in 2021, a time when meal delivery services were boosted by the pandemic.

“Following careful consideration, the Deliveroo Independent Committee has unanimously decided to recommend this offer, considering it to be in the interests of all our shareholders and wider stakeholders,” the company’s Chair Claudia Arney said in a statement.

Deliveroo has received undertakings of support from investors holding about 15.4% of shares, it said, including from founder and chief executive Will Shu, Greenoaks and DST Global.

However, Panmure Liberum analysts highlighted “the notable absence” of Deliveroo’s largest investor, Amazon (AMZN), from this list, adding that they still see Amazon as the most likely counter-bidder.

Amazon, which has a 14.4% stake in Deliveroo, did not immediately respond to a Reuters request for comment.

In 2024, Deliveroo and DoorDash had orders worth about a combined $90 billion, the companies said.

Will Shu, who co-founded Deliveroo in 2013 and leads the company, is set to receive about £172.4 million ($229.7 million) for his 6.4% stake.



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India just agreed a massive trade deal – with the UK

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London
CNN
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India and Britain struck a “landmark” trade deal Tuesday, the UK government said, marking progress on lowering and removing tariffs just as President Donald Trump is busy raising US import taxes to historic levels.

For weeks, Trump has said that at least one trade deal is imminent with one of the dozens of countries in active negotiations with the United States to avoid his punishing tariffs – with India among the most likely to reach such an agreement first.

The prospect of an agreement with any one major trading partner has boosted confidence in US financial markets and raised hopes that the world may avoid the worst impacts of America’s tariffs. But so far, no deal has emerged.

Instead, it’s the United Kingdom that has secured a trade deal with India.

The two nations’ agreement is “the biggest and most economically significant bilateral trade deal the UK has done since leaving the EU,” the UK Department for Business and Trade said in a press release.

As a result of the agreement, it noted, bilateral trade is expected to swell by £25.5 billion ($34.1 billion) per year in the long run. That would be a 60% increase from the 2024 level, based on UK government data.

India has agreed to reduce tariffs on a range of UK products, including whisky, medical devices, advanced machinery and lamb. And most of these levies will be removed altogether within a decade, according to the release.

In turn, the United Kingdom will lower tariffs on Indian goods, the business and trade department suggested, without providing details.

“British shoppers could see cheaper prices and more choice on products including clothes, footwear and food products, including frozen prawns, as (the) UK liberalizes tariffs,” the release said.

The Trump administration, for its part, has said India, Japan and South Korea will likely reach a trade deal with the US, but the weeks are rolling on with no deal in sight.

And the US has a tight deadline: Its so-called “reciprocal” tariffs are set to go into effect on July 8, when levies as high as 50% will start applying to dozens of nations. The Trump administration risks causing serious economic damage, which could quickly turn into a US and global recession, if it doesn’t hammer out any trade deals soon.

The UK’s latest agreement is not its first major trade deal with an Asian country. After leaving the European Union in 2020, Britain clinched an agreement with Japan later that year. That deal was set to increase trade between the two countries by about £15.2 billion ($20.3 billion), the UK government said at the time.

“We are now in a new era for trade and the economy,” UK Prime Minister Keir Starmer said Tuesday, commenting on the deal with India. “Strengthening our alliances and reducing trade barriers with economies around the world is part of our Plan for Change to deliver a stronger and more secure economy here at home.”

Emma Rowland, policy adviser for trade at the UK’s Institute of Directors, made a similar assessment.

“In light of recent trade wars and US tariff-related disruption, new partnerships that encourage free and open trade should be celebrated,” she said. “The UK-India trade agreement is a win for the UK, removing barriers and business costs for British firms trading with the fourth-largest global economy.”

CNN’s Robert North, Anna Cooban and David Goldman contributed reporting.



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Tesla sales plunge across Europe

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Tesla’s sales continue to dive across Europe even as car buyers there increasingly buy electric vehicles.

Tesla sales were down sharply in April in the United Kingdom, the Netherlands, Denmark and Portugal, as well Sweden and France, according to monthly sales figures.

Just like in the United States, Tesla CEO Elon Musk’s politics has inspired backlash and protests across Europe. Musk has backed some far-right political candidates in Germany and the UK. And given his high-profile role in the Trump administration, anger over the threat to slap steep tariffs on European imports could also be turning off some European buyers.

In the UK, one of the few European markets where Tesla reported stronger sales in the first quarter, April sales plunged 62%, according to UK auto industry trade group SMMT. The drop came even as overall EV sales rose 8% in the UK for the month.

Tesla sales were also down 67% in Denmark, 74% in the Netherlands and 33% in Portugal, according to data from trade groups in each of those countries. Sales were also down 81% in Sweden, and 59% in France, according to Reuters.

Tesla doesn’t report monthly sales and doesn’t break out sales by market. It did not respond to a request for comment on its April sales.

Activists of the Tesla Takedown movement protest outside a Tesla electric car showroom in Berlin, Germany. In Germany, many people are opposed to Tesla company owner Elon Musk's outspoken support of the far-right Alternative for Germany (AfD) political party.

European Tesla sales are falling for reasons beyond just Musk’s reputation. Some of the drop is due to increased EV competition from other automakers, particularly Chinese rival BYD, which is poised to pass Tesla as the world’s largest EV maker this year.

Tesla has not issued guidance on its 2025 sales volume. But some analysts expect a drop in Tesla’s full-year sales given both its recent sales declines and the backlash against Musk.

“In short, the second quarter of 2025 is (again) shaping up to be a disaster of a quarter for Tesla, following the disaster that was the first quarter,” said analyst Gordon Johnson of GLJ Research, one of the most bearish on Tesla stock.

Across Europe, Tesla suffered a 36% drop in sales during the first three months of the year, according to the European Automobile Manufacturers’ Association. That’s even as EV sales in that market rose 24% in the period.

This comes on the heels of Tesla reporting its first drop in annual sales for 2024, and the biggest drop in quarterly global sales in history during the first quarter. That resulted in net income falling 71% in the quarter. Tesla had to rely on the sale of regulatory credits to legacy automakers in order to report any profit at all.



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