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BP is shutting its low-carbon mobility team in the energy major’s latest retreat from its five-year-old attempt to diversify away from oil and gas.
The unit was responsible for developing electric, hydrogen and other low-emission solutions for vehicles, particularly trucks. It is the most recent casualty of chief executive Murray Auchincloss’s plan to refocus BP on its legacy oil and gas business.
Senior BP executive Martin Thomsen told staff on Wednesday that it was no longer “commercially viable” for BP to justify a dedicated team to the activity. Any remaining activities would be allocated to other parts of the business, he added.
In an effort to increase returns and boost BP’s share price, Auchincloss in February announced he was scrapping a five-year-old plan to become a major renewable energy player and cutting spending on green energy by 70 per cent. The strategy shift followed news that US activist hedge fund Elliott Management had taken a near-5 per cent stake in BP and was pushing for radical changes.
Thomsen wrote in an email to staff on Wednesday: “As you know, and Murray has made very clear, we can see that the energy transition is moving at a slower pace than we had anticipated.”
Projects in low-carbon mobility were developing “more slowly” and required “a lot of investment” at a time when the capital available to the wider division had been reduced, he added.
On a call with staff on the same day, he was more direct. “We had a view of low-carbon that didn’t happen,” he said, according to a person on the call. “We need to revert to the old BP — more oil and gas — and old-fashioned retail — petrol, diesel.”
Thomsen is currently a senior vice-president in charge of emerging markets in BP’s customer and products division, which manages BP’s global network of petrol stations. He was recently promoted to head both BP’s global electric vehicle charging business, BP Pulse, and its retail network in Europe, following the departure of several senior leaders.
Tracey Clements, a former Boots and Tesco executive, stepped down as the head of BP’s European retail network in January after three years with the company. She was replaced by the chief executive of BP Pulse, Richard Bartlett, who was appointed to run both businesses. Bartlett then announced his own resignation last month.
BP confirmed the decision to phase down and close the team.
“As we focus our downstream businesses and activity we don’t believe we need to maintain a separate dedicated team to consider such future options,” it said. “Its activities will be integrated into our businesses.”
BP added that the decision would not affect BP Pulse. The company said it remained focused on expanding its EV charging business in its four key markets of the UK, Germany, the US and China, and on growing through joint ventures in India, Spain and Portugal.
