Return to Transcripts main page
QUEST MEANS BUSINESS
Does Ireland Need a Bailout?; GM Revival?
Aired November 17, 2010 - 14:00:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
RICHARD QUEST, HOST: The financial troika is coming as Ireland insists it does not need a bailout.
The survival and revival of GM, it is getting ready for that record IPO.
And Starbucks' CEO says they'll grow their own coffee to keep growing.
I'm Richard Quest. We have an hour together, and I mean business.
Officials are on a support mission to Ireland as pressure mounts on the debt-laden nation to accept a bailout. A team from Europe and the IMF will land in Dublin on Thursday. They will ask to see the books and they will assess the extent of the damage to Ireland's battered banking sector. Working out how much help Ireland may need if the country decides to ask for it. The country's prime minister, the Taoiseach, says there is no question of a bailout. Nevertheless the economics affairs commissioner of the EU, Olli Rehn, says it is best to be prepared.
(BEGIN VIDEO CLIP)
OLLI REHN, EU COMMISSIONER FOR ECONOMIC AND FINANCIAL AFFAIRS: The Irish authorities are committed to intensify this work, now with the commission, vis-a-vis the IMF, to determine the best way to provide any necessary support to address market risks, especially as it cuts the banking sector. And as I said last night, this can be considered as an intensification of preparations for a potential program if requested by the Irish government and if deemed necessary by the euro area member states.
(END VIDEO CLIP)
QUEST: Ireland is not an urgent need of cash. It won't need to borrow on the markets until next year, fully funded until mid-2011. The Irish finance minister say that at the moment no funds need to change hands. The EU simply needs to open the suitcase and show the markets the money.
So, will Ireland finally agree that it is time to put in place some sort of standby loan? Jim Boulden is our correspondent and is in the Irish capital of Dublin this evening, and joins me.
Jim, will they call it something else, but it is a bailout by any other name?
JIM BOULDEN, CNN INTERNATIONAL CORRESPONDENT: Well, they're not going to use the term, "bailout" tomorrow, Richard. I can tell you the prime minister just went on television again here, in Ireland. And went to great pains to try to explain what's going here and what these talks on Thursday will be about. And he said, what they're going to do is have discussions of a technical nature. That's his term.
He said it is not negotiations and it is certainly not going to be discussions or negotiations about a bailout. He says the first step needs to be these technical discussions with these experts from the IMF and experts from the ECB, to go over the books. To talk about what specifically is the problem with the Irish banks. He said then once the government understands all the details after that.
I think I've got it now, Richard. Tomorrow, technical details, discussions, not negotiations, not yet.
QUEST: Right. But, Jim, why would Ireland be so reluctant to even put in place what the IMF used to call standby agreement, some form of facility just in case?
BOULDEN: The prime minister has said, again tonight, he's not going to say what his bottom line is. What his negotiating position is, because of two things. One, there are always strings attached with IMF money. Would that include having to change his budget deficit projections, having to be even more severe in any kind of four-year plan that is going to come out in the next two weeks, about what more severe cuts to the Irish budget.
Secondly, will it have to change its corporate tax rate? That is very important in this. We know that Ireland has a lower corporate tax rate than much of Europe, and it has been a great advantage for the Irish economy. In the 1990s all these American companies, Dell, Intel, etc cetera, moved here and set up because of a low corporate tax rate. There are some people who think that Ireland will have to give up that low corporate tax rate and that the opposition parties say that is a loss of sovereignty. And it is a very, very, technical issue here, and a very important issue.
QUEST: Jim Boulden who is in Dublin for us tonight.
Now Ireland, of course, shares a border with the United Kingdom to the north of the island, Northern Ireland. And the British Finance Minister George Osborne today extended the hand of friendship. Although, Britain would not be part any European Stability Fund bailout. Osborne told reporters that Britain would support Ireland's attempts to stabilize the banking system on a bilateral basis.
(BEGIN VIDEO CLIP)
GEORGE OSBORNE, BRITISH FINANCE MINISTER: We are going to do what is in Britain's national interests. Ireland is our closest neighbor and it is in Britain's national interest that Irish economy is successful and we have a stable banking system. So Britain stands ready to support Ireland in the steps that it needs to take to bring about that stability.
(END VIDEO CLIP)
QUEST: George Osborne, the U.K. finance minister.
What happens next is the subject of that tug of war between the better-off nations and those that are most indebted. And arguably the person with the single-most power is Angela Merkel, the German chancellor. Now, Mrs. Merkel is getting increasingly obstreperous when it comes to other members of the European Union. A variety of issues have all meant that she's found herself on the single-handed side. For instance, her decision to go hell for leather and suggest that bunde holders must be part of any bailout system. Finally, of course, they all had to agree this would only happen in the forward looking, not retrospectively. Therefore bond holders would not be at risk necessarily in the Irish system.
But that was only of the situations where the Chancellor Merkel has been so difficult in the eyes of her Euro colleagues. She helmed the Greek bailout. She was the one on Germany's behalf that resisted a bailout, said it wasn't necessary. Said the EU had no authority to do it until finally it looked as if the whole thing was going to come down around their ears. And she relented and went for the bailout. Many people say it was her delay in agreeing to it or going along with it that led to so much more damage.
And, of course, to do these bailouts and the European Stability Fund she is demanding and has demanded a Lisbon treaty amendment, which of course has opened up an entirely new can of worms. So, is Mrs. Merkel a woman of principle, or is she truculent and difficult? Let's talk to Daniel Gros, the director of the Center For European Policy Studies, who joins me via broadband from Brussels.
Which is it, truculent or woman of principles?
DANIEL GROS, DIRECTOR, CENTER FOR EUROPEAN POLICY STUDIES: A woman of principle and possibly (ph) a woman who doesn't understand how the financial markets work. And that is why we have possibly the trouble that we have today. She doesn't understand that she cannot announce to the markets, we might have something which provided we have a haircut in a few years down the road. Because markets when they hear that they are taking flight and they are selling the big (ph) bonds and other bonds (INAUDIBLE).
QUEST: Now, I was particularly attracted to your comments quoted in this morning's "Financial Times" when you said that other-"that within the Brussels community and within other nations what is being said about Mrs. Merkel is unprincipled." What did you mean?
GROS: Well, there is of course resentment in very wide quarters with the other finance ministers, central banks, who think that opening discussion on possible losses by private investors, was the wrong thing to do and that exaggerates the problems. That is true.
There is also a wider agreement that this has to come, sooner or later. The only problem is let's not talk about them. Let's do it. One day it has to be done. Pretty much everybody agrees on that. But everybody says, please don't talk about it.
QUEST: But you can't ignore the German government and the German government's position, can you? The truth is the largest contributor of the budget, the largest single European economy, the headquarters of the ECB is based there. And I'm not being discourteous to Mrs. Merkel, but where does the 500-pound gorilla sit? Where ever it wants to.
GROS: Exactly. She (UNINTELLIGIBLE) and that is what the others present. Even if in the long term she is right. But others are saying, please, don't talk about it. Let's not talk about it now. But especially, the Irish, the Portuguese, the Greeks. I think after if she hadn't talked about it then it would be all (UNINTELLIGIBLE). Maybe a little bit, but not much.
QUEST: All right. Daniel, let's finish this discussion tonight. How much is there a feeling in Brussels tonight that the euro project, if not in danger, is at least on very shaky ground. The Euro Zone is on shaky ground, and the risk of contagion is critical.
GROS: Oh, yes. Anybody knows that we are skating on very thin ice. That we can say Ireland and Portugal, but what next? And then there might be a really big crisis. Nobody thinks of the Euro Zone will actually break apart, but they might have such a big crisis the Germans and others will have to stand up even more money. That the ECB will have to be called in, and perhaps, at that point we can get a realistic (ph) solution.
QUEST: Daniel, lovely to talk to you. You and I will talk again, no doubt, on these issues. Daniel Gros joining me from Brussels.
Now that mission to Ireland, well, it doesn't arrive until tomorrow. But it has reassured investors. The banks felt the benefit in Dublin. Allied Irish and BOI, both picked up healthy gains. Irish Life and IFG Group, provided financial services, also ended the day higher. Europe's main markets also made gentle progress. Banks provided some support, Farmer were also amongst the gainers.
The Dow Jones in New York at the moment, very briefly update you on that. It is hardly worth mentioning. It is up just 4 points.
In a moment, the Irish, like the Greeks, are on a path to near or complete insolvency. That is according to the article I read earlier today. The Irish issues, it also says, should Europe speed its default plan. Now, this article, that I posted at Twitter.com/RichardQuest. This article is by Nouriel Roubini and when Nouriel writes something of interest like this, then it is well worth us having a look at it.
The argument is simple. The default is better to happen sooner than later, and it would be easier to get it over and done with. Read the article and become a friend and join the debate.
(DESK BELL CHIMES)
A bit of Eastern promise for Starbucks. It is seeing China as a fertile ground. The chief exec talks on changing tastes and growing beans. QUEST MEANS BUSINESS, good evening.
QUEST: Starbucks, the coffee company, is getting self sufficient for the first time in its 40-year history. It is going to grow some of its own beans. Revolutionary stuff, you may say. Starbucks will start its coffee farm and this, perhaps, is the most revolutionary bit in China's Yunnan Province.
Now, look at this, and it makes it clear. Starbucks, at the moment, in China has 800 stores, in greater China, in the whole of greater China. Compare that to 13,700 stores in North America. And you can start to see the potential for growth, not only for the consumer of the coffee, but also for the growers of the beans, particularly, if those beans will be used in homegrown coffee.
CNN's Stan Grant, in China, asked Starbucks Chief Exec Howard Schultz, how he goes about giving a traditionally tea-loving nation that Starbucks Coffee buzz.
HOWARD SCHULTZ, CEO, STARBUCKS COFFEE: Well, in many ways we have already begun doing it. We have been here for 12 years now. With 400 stores in the mainland, 800 stores in greater China, the business is profitable. And I think, most importantly, the Chinese consumer has embraced Starbucks as their own.
STAN GRANT, CNN INTERNATIONAL CORRESPONDENT: But what is it about the Chinese that has changed. Is it just that they are wealthier? That they are more sophisticated? Their tastes are changing? What do you put it down to?
SCHULTZ: I think it is a few things. One, obviously, there is a tremendous size, in terms of the aspirational middle class. The numbers of people who have access to disposable income, and also they are quite familiar with Western brands. One of the things that surprised us the most is how aware they were of Starbucks before we got here. And how fast they embraced change is another thing that has really surprised us. People were drinking black coffee when we got here. Now they are drinking cafe latte, and cappuccinos, and frappuccinos. And it is just so quick.
GRANT: So what you are talking about is the Starbucks experience. But there has been a lot of criticism that some of the Starbucks experience is being lost in other parts of the world. That Starbucks has lost its gloss. Are you re-finding that again, here?
SCHULTZ: I returned as CEO in January of 2008. And since that time we have literally transformed the company. Last quarter we had record profits, record revenue in our 39-year history. I think the thing that we have done really well over the last couple of years is go back to the roots and heritage and tradition of our company. Most specifically, the values of our people. So, tough choices were made, but the company is completely transformed and healthy. And in terms of China, China is going to be the fastest growing, biggest market for the future of Starbucks outside North America.
GRANT: So what we are talking about here is your bean to cup strategy. How does Yunnan fit into that?
SCHULTZ: We view China, obviously, as a very big prize. And what we want to do is make a comprehensive, strategic commitment to doing business in China in a way that is locally relevant. Starbucks, for the first time in our 40-year history, is going to start growing coffee. Now, we are already sourcing and roasting the highest quality coffee in the world, but for the first time in our history. We are actually going to plant trees and grow coffee in China, in the Yunnan Province. We have discovered a part of the area there that can produce the world's best coffee and in three to four years we will bring coffee from Yunnan to the world.
GRANT: And that takes us back to our first point again, changing the culture here. Who are your main rivals going to be, because this is a growing market?
SCHULTZ: Well, I think we have had competition in every market. We can't allow the competitors to define who we are. We control our own destiny. The size of the prize here is there will be lots of people who will come into the marketplace, both in the coffee business, and others, that will win. One thing I can tell you is we are taking the long term, making the right kind of investments ahead of the growth curve. We are going to build a significant business here in China, in which Starbucks will be known as the leader in our industry.
GRANT: Thank you. Pleasure.
SCHULTZ: Thank you.
QUEST: That is the chief executive of Starbucks talking to Stan Grant.
Next on QUEST MEANS BUSINESS we turn our attention to the "World At Work". Looking at a big name cover up and throwing lipstick and mascara in, too. The make up designer Bobbi Brown's "World At Work". Coming up next.
QUEST: Ah, welcome. Come into the television presenter's confessional. This part of the building that you rarely get to see. This is Jo, who does magnificent work, usually before you and I get together on our evening program, and evening's conversation.
Now, in the exciting world of television news, lights, music, cameras, it is all about making things look good. For the cosmetics maker, Bobbi Brown, make up is the very art and the very soul. For a behind-the-scenes look into her role at the company she founded in 1991, let's join Bobbi Brown, in her "World At Work".
BOBBI BROWN, FOUNDER, BOBBI BROWN: I'm here at our 20-something annual boot camp, which is where my best artists from all over the globe are here. And I teach and I train and I talk.
Good morning, everybody.
I didn't get to see everyone last night. And if anybody has any pictures of me dancing and if it is on YouTube or Facebook, you're fired!
We've grown so much that in order for to get the message out, all over the world, and to be able to have not only women understand how to do their own make-up, but make-up artists understand the brand and the products, the way to do that is really with my ambassadors. That is basically the only market research I really enjoy. Is hearing about what my artists are saying and what the customers are saying.
What did you guys think of the new products yesterday.
Yeah? What are you the most excited about seeing? Concealer?
We are going to start with a hydrating eye, and that is natural.
Well, the Bobbi Brown look, to me, is really simple. It has got to be make-up that is right for a woman's style. But the colors have to be natural to a woman's skin and they have to look like skin.
But can you see, already? I mean, for you guys on this side, it is just now it is flawless.
The company is 20 years old. And I started this company with a lipstick; a lipstick that looked like lips. You have to have a product first of all, or an idea that doesn't exist in the market. There are too many me-too things happening out in the world. And you need something that is needed, and then it is much easier to figure out what to do from there. I thought, wow, what a great idea. A make-up company that is actually been created from a make-up artists.
The best trait I have, being an entrepreneur, is that I am very naive. I never thought that I wouldn't succeed. I know it sounds a big intense, because it is make-up, but if you can take a woman and show her a product that makes her look less tired, makes her look fresher, prettier, there is not better feeling in the world.
Pass it around and feel it. And it is really warm, by the way.
I am incredibly passionate about creating new products and colors. You know, how lucky am I that I get to have an idea and it could be an idea coming from no where. I get to come in and tell a group of people, that I really enjoy their company, about this idea. We work together and we keep meeting on the same idea.
UNIDENTIFIED FEMALE: So, Bob?
BROWN: Yeah? Woo! Hey, guys, everyone know my friend, Kat?
How are ya? How are ya?
UNIDENTIFIED FEMALE: Very good. Great to see you.
BROWN: Our surprise guest, you know, Kat Deluna (ph) who is an up and coming star. I think she is going to be a superstar, I really do. I met her last year at an event. We became friends. She happened to yesterday, she said she was going to be in the neighborhood, could she stop in? I said, absolutely. I knew my artists would get a kick and a thrill out of meeting her.
There is no average working day for me, at all. Everyday is different. And, you know, my biggest problem in life is that I have too many great things going on all the time.
QUEST: Bobbi Brown, and her "World At Work". And you thought all this was natural.
(DESK BELL CHIMES)
When we come back in a moment we will back in Ireland where the shine is well and truly wearing off. If you are young and ambitious it is time to get going; a new generation of Irish are being driven abroad.
QUEST: Hello, I'm Richard Quest. QUEST MEANS BUSINESS, this is CNN. And here the news is always reported first, the headlines.
Now turning to our top financial story. The mission of mercy to rescue Ireland, as it is seen by some. Officials from the EU and the IMF are preparing to fly in but many others are planning to depart. CNN's Jim Boulden explains now what is driving so many young Irish people to leave home and country.
JIM BOULDEN, CNN CORRESPONDENT (voice-over): When the Celtic Tiger was roaring, Ireland reversed a century-and-a-half of net migration. In the 1990s, the Irish came back to work and invest. Then came the economic crisis. People are leaving again.
Student Enda Costello says he's off to New Zealand.
ENDA COSTELLO, STUDENT: I'd just like a job around here. I have my degree. It's not worth anything to me here. So I've heard there's good science jobs in New Zealand, so that's where I'm going to go.
BOULDEN: Economist and author, David McWilliams, left in the 1980s and came back.
DAVID MCWILLIAMS, AUTHOR: When I left Trinity, I had stamped on my head, "made for export." So it was a novel thing. We didn't expect to stay here. This generation, the difference is they expected to stay here. There was no collective memory for them of emigration.
BOULDEN (on camera): But isn't it the case that it's good for the Irish economy that people can easily come and easily go?
MCWILLIAMS: Well, it's a lack (ph) in the economy. It's families. It's moms and dads. It's brothers and sisters. You know, if you tear apart the social fabric which is the family, yes, it may well look good in productivity figures, but it's emotionally a disaster for the country.
BOULDEN: For a snapshot of how emigration is affecting the Irish economy, look no further than here -- Croch Park (ph), an 80,000 seater stadium for the amateur sport of Gaelic football.
(voice-over): Players like Aiden Hoey dream of playing here. He's fortunate to have a job as a policeman, which allows him to play this amateur sport. But three players on his county team are leaving the country.
AIDEN HOEY, GAELIC FOOTBALL PLAYER: They are young men and they have to go and try to support themselves. There's no point staying at home and -- and living off the dole or -- or welfare or that. There's no point in living with their mother. They have to -- they have to find their own feet and have to become their own person.
So it's -- it's entirely their own decision. And then it was a hard decision, but it's not as if it's a -- it's a -- it's a lifetime decision.
BOULDEN: The Players Association says the only way to keep more players from leaving is work training and government subsidies. But with another round of budget cuts looming, it's not clear if the subsidy will survive intact.
SEAN POTTS, GAELIC PLAYERS ASSOCIATION: We understand, like everybody else, as well, that there are circumstances which are affecting the country at the moment. But having said that, one of the bullish words at the moment is front loading how you put the -- make people enjoy the pain. A lot of it, initially, we've already endured severance (ph) and cuts to the funding. So we'd be hopeful that that will be taken into account.
BOULDEN: But with many Irish fearing high unemployment for years to come, the pull of available jobs overseas is just too strong, as the Irish diaspora begins to grow again, as it has many times in Irish history.
Jim Boulden, CNN, Dublin.
(END VIDEO TAPE)
QUEST: Investors are itching to get a piece of the new General Motors. We'll look at what's set to be a record breaking IPO and speak to the man hand-picked by President Obama to turn the company around.
That's after the break.
QUEST MEANS BUSINESS.
QUEST: Back on sale to the public -- General Motors' shares go back on sale to the public tomorrow. Investors are soaking to get hold of them.
But the reborn G.M. has increased the size of its IPO by 31 percent. That's quite a sizeable increase in shares going to the market. What it means is it could bring in a record $20.4 billion. Now if that happens, it would become the biggest IPO in history.
Even so, after the sale, the U.S. government's share will drop from 60 to 30 percent.
So you may think, well, hang on, does this mean the U.S. government is out of G.M. with a profit?
No. The share price will have to rise by more than 70 percent if the taxpayer will recoup all the $28 billion G.M. will still owe after the shares come to market.
But that's still an impressive performance for a company that went into Chapter 11 just 18 months, two years ago.
Last year, President Obama put the financier, Steven Rattner, in charge of restructuring G.M. into a profitable company.
CNN's Felicia Taylor spoke to the former car czar about getting G.M. back in the black.
FELICIA TAYLOR, CNN CORRESPONDENT (voice-over): He was dubbed "the car czar." Steven Rattner brought together Team Auto and went to work reassembling the many parts that went into this iconic American car company.
Rattner faced his critics from the start -- how could a Wall Street financier with no expertise in corporate America save the likes of G.M.?
STEVEN RATTNER, FORMER OBAMA AUTO CZAR: This was not a management job. We we're not hiring somebody to manage G.M. or Chrysler. We were hiring somebody to restructure them. And that is what I used to do for a living. And they felt I knew something about it.
TAYLOR (on camera): What was your first priority?
What was the number one job to get done?
RATTNER: Probably the most important thing was to try to figure out how to get a team, because without that, we would have been toast.
Team Auto was -- was a wonderful group of people, the most wonderful group I've had the privilege of working with. They all volunteered. They all came -- almost all of them came from outside the government, many from New York, from Wall Street, because they wanted to serve.
TAYLOR: That brings me to this picture. And it's -- it's clearly a pivotal moment in what's going on. And I actually had to take a look for a second and realize who was in the background.
RATTNER: What you see happening here are people hud -- huddling over a balky speaker phone that kept issuing static rather than voices. What was about to happen was unprecedented.
(BEGIN VIDEO CLIP)
BARACK OBAMA, PRESIDENT OF THE UNITED STATES: One of the challenges we've confronted from the beginning of this administration is what to do with the state of the struggling auto industry.
RATTNER: The president was going to say that both companies needed a fundamental restructuring, that Chrysler would be allowed to liquidate if we could not achieve a fundamental restructuring and that bankruptcy was very much an option for both companies.
And this was a bolt of lightning to the Michigan delegation, and then, ultimately, to the rest of the country.
TAYLOR: That had to have been an enormous amount of pressure, knowing that those -- those people's livelihoods -- and you're that they -- if they lost their jobs, they probably wouldn't get another job again, because they don't exist.
What does that feel like, to hold that kind of responsibility?
RATTNER: It was terrifying. I would wake up in the night and I would think to myself, all that -- this whole industry, all these people are relying on a small group of us to make the right decisions. We had no idea, honestly, because it was not knowable, what the impact of the president talking about bankruptcy for these companies would be on car buyers. If the car buyers had gone on strike and said we're not buying any cars from bankrupt companies, these companies would have collapsed. There's no amount of government money we could have put into them that would have saved them.
We -- it was what one of my colleagues called a hold hands and jump moment. We really didn't know exactly what was at the bottom of that jump and what we were going to face.
TAYLOR: President Obama was barely in office when all of this fell apart and came down.
What was it like to deal with him on a day to day constant basis to rescue this company?
RATTNER: Here's poor President Obama. He shows up for work and one of the first things, what do you do about a bunch of bankrupt automakers or insolvent automakers?
And it was interesting to watch him, because I can't imagine he thought or cared much about the auto industry. It's not why he ran for president. I think this was a seminal moment in the whole interaction between government and private sector. This was almost without precedent - - probably it is without precedent -- of the government coming in, saving not just two iconic companies, but a whole industry with $82 billion of capital and having it work and having the government also know when to get out and when to step back.
And I think the president honestly -- and I'm -- he doesn't sign my paychecks anymore -- I think he was a man of incredible courage and determination to do this the right way and I think he deserves credit.
TAYLOR: What -- what is in G.M.'s future?
Can it go back to its greatness?
RATTNER: I think it -- it's never going to go back to having 50 percent of the U.S. car market. That -- that's a historic thing. It will have a profit this year for the first time since 2004. That is already a partial return to greatness.
Its operations in China are amazing. They sell more cars in China than they do in the U.S. They're very successful in Brazil. And in the U.S., for the first time in the U.S., they have stabilized this constant decline in their market share and they actually have a prospect of turning it up.
I think G.M. has a long way to go up in terms of doing really doing even better than the way it's gotten itself to this great IPO.
TAYLOR: Do you feel proud of it?
RATTNER: It's the most extraordinary thing that's happened in Detroit in -- and certainly a good thing -- in years and years. And the -- the change in the mood out there and the sense of excitement that I saw on people's faces in Detroit, it made me feel so good that I did this. You know, it came with a fair amount of pain for me personally, financially, every other way, but, you know, people ask me would I do this again and the answer is of course, because I think we really made a difference.
(END VIDEO TAPE)
QUEST: Absolutely riveting, listening to that.
Steven Rattner talking to Felicia Taylor and giving us the sort of insight -- well, frankly, that you only hear on this program -- into the decision-makers and the decisions that they took.
Now, part of G.M.'s new strategy is a switch to more fuel-efficient cars. On Tuesday, it unveiled a new hybrid gasoline electric model at the L.A. Auto Show. It's the Buick LaCrosse and the queen is the theme at the event.
Ted Rowlands is there.
Ted joins me now from Los Angeles live -- Ted, G.M. is perceived to be back on track. We've got the IPO tomorrow. But in L.A. at this show, do they like the vehicles?
TED ROWLANDS, CNN CORRESPONDENT: Well, I'll tell you, there's a lot of excitement here, not only with G.M., but with the entire industry. You know, we've been covering this every year and the last two years, it has really been depressing coming to these auto shows because the market had been so depressing.
Well, you could feel the excitement. Let's start with Chevy and the Volt. They've got a lot riding on the Volt. This is one of the things that they held onto desperately during the down time. The Volt is being shipped and being sold and it's a big hit at the Auto Show here. A lot of people still interested in it -- 20 to 50 miles on a charge. There's a gas generator that then kicks in. About $40,000 retail.
This is the Mercedes version, which was just unveiled about an hour ago of a zero emission hybrid car. And we're going to hear a little bit more about this in a bit. It is basically a hydrogen shell -- a hydrogen cell fueled vehicle. This is Mercedes' version. Fifty companies in all have alternative fuel cars out here at the Auto Show. And they are all getting a lot of looks, but nobody is getting as many looks at this guy here. This is a concept car by Jaguar, a CX75. The top speed on this supposedly 205 miles per hour. There are micro turbines that power to generators. It's an extension -- extended range alternative fuel car. But, obviously a concept car.
Let's talk a little bit more about the Mercedes.
But let's do the interview in one of their Maybachs. This, Richard, as you know, is a $500,000 car and it is luxury at its finest.
This is Steve Cannon.
He's the V.P. of U.S. marketing.
We're talking about all the different companies going in different directions. Mercedes has gone hydrogen.
Where is this going to end up in terms of the alternative energy vehicles?
STEVE CANNON, MARKETING VP, MERCEDES-BENZ USA: The market is ultimately going to choose. The customer is going to choose. Right now, it's too early to tell which technology is going to win. So it's going to happen on multiple fronts.
So engines are going to get more efficient. So the internal combustion engine is not going away any time soon. But we're all trying to get more efficient and eke more miles per gallon out of current -- out of current technology. That's one thing.
We're hybridizing and electrifying our vehicles. So that's another path that we're going. And we're pretty excited to be launching for the U.S. small series production of the -- of the F-Cell, based off of the B- Class platform. And that's a hydrogen electric vehicle. So it's powered by hydrogen, zero emission. The only tailpipe emission is droplets of water. So it's -- it's environmentally as friendly as it gets and it's got a great range.
ROWLANDS: It's also available in Germany and in other European countries soon. Tell me about this doozy.
Who buys this?
CANNON: This -- this is the fastest ultra -- ultra luxury sedan on the planet. This is like a private jet on wheels. So it's interesting that we can talk about -- in one -- in one sentence we're talking about F- Cells and hydrogen electric vehicles and then we're talking about this half million dollar private jet on wheels.
The Maybach is a very small production for people that want absolutely the very best. So this is -- the 62S is obviously a chauffeur driven car. It's got every single amenity. But for the folks that -- that want that kind of thing, it's great that as a Mercedes Benz brand, we can kind of offer that whole -- that whole variety.
(END VIDEO TAPE)
ROWLANDS: All right, Richard, I want to show you one other, the Phantom Rolls-Royce. Obviously, it's been around for three years. It's getting a lot of attention, as well here -- $450,000 out the door. It is the drop head. And as Sir Henry Royce said many years ago, it's a combination of power, refinement and a bit of fizz.
There's a lot of fizz here at the Auto Show, a lot different than in years past.
The excitement is back in the industry and you can feel it here.
QUEST: All right. A quick question to you, one quick question. I'm going to write you a blank check.
Do you want the Maybach or the Rolls?
ROWLANDS: I'll take the Maybach. The -- this is -- this is my Maybach, yes. I've sit in -- after sitting in this, I -- I need a driver, though. If that's part of the deal, I'll take this one.
QUEST: Give me the Rolls any day. Just -- there we go. All right. Ted Rowlands, let's see if either of us can get one day's rental of that car past our expense management.
Ted Rowlands at the L.A. Auto Show.
Many thanks, indeed.
And now, I shouldn't think Guillermo -- Guillermo, when it comes to the World Weather Center, Maybach, Rolls-Royce, I suspect you're more of a sporty sort of individual yourself.
GUILLERMO ARDUINO, CNN METEOROLOGIST: Oh, no, not at all. I'm very traditional. But if the company is paying, I'll take the Rolls-Royce, too, let me tell you.
London is seeing rain, but there are no warnings whatsoever. It's going to get cold. I think Friday is going to be a nice day, you see?
But we have no warnings. We have the rain now ending for a little bit. We're going to see some gray clouds and that's about it.
The problems are in other sections. Think Oster (ph). Look at the rain and also -- another picture -- it's been raining a lot. We're going to see some more. Friday, again, is the best day that we have.
Rain showers here but no delays. Dublin with some windy conditions. It's going to get colder. Munich and Duringen is where we are going to see some snow. And Schleswig-Holstein in Germany with some winds.
Then Italy is a disaster. We are seeing more rain in the north, some winds to the south. Snow in the northern parts of Spain, as well. You see it's getting cold. It's getting cold in Europe.
Now, Britain doesn't have any warnings at all. Eleven degrees is the high expected for Thursday, yes, for Thursday. The low temperature of the day is going to be colder.
Then in the States, you know, I anticipated so much rain, actually, we had problems with winds in Baltimore and the Washington area. Now the story, the storm is gone. So things are much better.
But on the other side of the country here and also B.C., British Columbia, Vancouver -- what a wonderful city -- with bad weather now. Seattle and Oregon, Seattle in Washington State, Portland, Oregon, there you go, with also some bad weather. And Winnipeg already lead -- leading the charge with minus four degrees. That's right now. It's very cold.
Two in Minneapolis. Also, we have some cold conditions and bad weather there. Twenty-six in Orlando, though.
And the -- the highs for tomorrow, minus one in Winnipeg; Chicago, seven degrees. But the weather is much better for our -- our travelers who are coming to New York, OK?
So I want to be clear about that.
QUEST: A lot of focus there on those cold, snowy Canadian cities there. Me thinks you're -- I -- I spot Guillermo heading off for another of his legendary quick breaks.
QUEST: Yes. Yes. Oh, forget about it.
All right, Guillermo.
See you tomorrow.
ARDUINO: See you.
QUEST: Forget stuffy old chief execs on this program. Here, we've got hip-hop heroes and skateboarding legends -- two bosses who are anything but boring, in a moment.
QUEST: Now, chief executives all over the place on this program. FBI says that this man is worth just short of half a billion dollars. Yes, this one on the right of the picture. Jay-Z is one of the biggest music artists on the planet. And he has turned hip-hop into serious business. After all, where else would you expect to see Jay-Z and Warren Buffet on the front page of a magazine?
Yesterday, he tried his hand in another field. Jay-Z has released his memoirs, titled "Decoded." But that's not all. His Rocawear clothing range has sales of more than $700 million. And then there's Roc-a-fella music label, which he has founded. He has a sports bar chain and the New Jersey Nets basketball team.
Not bad for a rap artist. Not many can say they've shared the cover in -- with Mr. Buffet.
CNNMoney's Poppy Harlow met -- no, not Warren Buffet, Jay-Z.
JAY-Z, RAPPER AND BUSINESSMAN: I wanted to make the case that rap is poetry, for one; and, you know, some of the decisions we made, to give those decisions context, why these songs are the way they are, why there is this certain gangsta rap, you know, why this, you know, is taking place in America.
And it just felt like the perfect time to write it.
POPPY HARLOW, ANCHOR, CNNMONEY.COM: You said President Obama had the courage to tell the press that he had your songs on his iPod. You've been a big supporter of his the entire way through.
Has he followed through on the hope that he promised?
JAY-Z: I think he has -- he has -- he's on his way to delivering that. But it's impossible for someone to take eight years of our last administration and turn it around in two years. It's very difficult to deliver on everything. You know, I think he's moving in the right direction, yes.
HARLOW: You spent hours meeting with him and you write in the book about that meeting. And you say: "I wish I could remember one thing," but it was more what President Obama represents for you, the people you grew up with, black children, black adults across this country?
JAY-Z: Yes. And -- and which means all children across this country. You know, that -- you know, us first because it gives us a -- another face, another -- the hope of, OK, maybe I can be president of the U -- the United States. It takes for someone to do it for you to believe that you can achieve such lofty goals.
HARLOW: You insist that rap is poetry. And you wrote: "Chuck D. famously called hip-hop the CNN of the ghetto.
Does hip-hop and rap have a responsibility to report and not just entertain, to take it one step further?
JAY-Z: Yes, of course. You know, you can entertain. It's everything. It's -- rap is, you know, it's entertaining, it's informative, it's provocative, it's funny, it's silly. You know, it's all of these things. So absolutely.
HARLOW: What did you learn on the street, because you talk about being 13 and selling crack.
Did that teach you something of how to be a successful businessman or how we all are...
JAY-Z: Yes, all the things...
HARLOW: -- are common...
JAY-Z: -- all the things that you apply in business, you know -- you know, they say that he has great instincts, you know, but while on the streets, having great instincts can be the difference between life and death, not just losing the deal.
(END VIDEO TAPE)
QUEST: Jay-Z talking to Poppy Harlow.
Now, just when you thought Jay-Z was our most unusual chief exec tonight, oh, no. The skateboarder, Tony Hawk, has swapped his board room for the boardroom. The first man to spin a full 900 degrees on a skateboard has pulled a career 180 and he's written a book that pushes his business credentials.
The title of Hawk's book is "The Ascent of an Unlikely Chief Executive or CEO".
TONY HAWK, AUTHOR/SKATEBOARDER: And I was met with a lot of resistance in terms of...
QUEST: -- how has he managed to -- into -- boarding into a business.
HAWK: Well, I grew up in a time when skateboarding was not popular at all. And I was met with a lot of resistance in terms of wanting to do it professionally or wanting to do it for a living, especially as I got to an age of responsibility.
So just believing in myself and to know that I -- I -- I felt like it was something valid, it was something substantial that I could do and believing that it would get more popular.
And in terms of my approach to my businesses in my -- my later years, is the same way. You know, I feel like it's more intuition than anything. And -- and if I'm passionate about it, I'm going to see it through.
QUEST: What is it in the business world that does excite you in that sense, because, obviously, the skateboarding and the performance side is a huge driver for you.
But in the business world, what is it you find interesting or is it just a means to an end?
HAWK: I find it interesting that skateboarding is a -- a bigger industry now and that there are many other opportunities within it to promote the brand, to promote licensing. I mean there are -- there are things that are including our graphics and our imagery that I never imagined people would be interested in.
But for me, I think the most exciting aspect is the international growth.
QUEST: And let's talk about that.
When is a brand -- when does a person become a brand?
It's almost a mantra to -- to -- to escalate something beyond just the mere normal?
When do you think you become a brand?
HAWK: I think it's when -- when people know your name for more of a product than the actual person. And -- and that's, you know, sometimes there's just a tipping point when that happens. I think for me, I think it was my video game -- my video game release. People started saying my name that -- and it meant a video game. It didn't actually mean the person behind it.
QUEST: Did it feel a bit weird that suddenly there was you, the man; you, the father; you the skateboarder; and then this other thing, you?
HAWK: Yes, it was very strange. In fact, you know, my video game got so successful that people didn't even know it was a person and they questioned if I was real or not.
QUEST: And when you -- if you were talking -- and you do talk to entrepreneurs, young people who want to make it in business, I can understand why you would say to them, you've got to have passion.
But what else would you advise them to do?
If somebody wants to make it, is passion alone enough?
HAWK: I would say surround yourself with people you trust and share the same vision and -- and chase the opportunities, either to get investments or to promote the brand.
(END VIDEO TAPE)
QUEST: that's QUEST MEANS BUSINESS for tonight.
I'm Richard Quest in London.
Whatever you're up to in the hours ahead, I do hope it's profitable.
"WORLD ONE" is amongst you now.