Return to Transcripts main page
First Move with Julia Chatterley
China's Clamp Down Extends to Online Education, Stocks Plunge; Protests across Europe as new Vaccine Rules are Reinforced; The Olympic Medals Flow for Japan as TV Ratings Soar. Aired 9-10a ET
Aired July 26, 2021 - 09:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[09:00:16]
JULIA CHATTERLEY, CNN BUSINESS ANCHOR, FIRST MOVE: Live from New York, I'm Julia Chatterley. This is FIRST MOVE, and here is your need to know.
Tutoring tech. China's clamp down extends to online education, stocks plunge.
Monday mayhem. Protests across Europe as new vaccine rules are reinforced.
And Tokyo turn around. The Olympic medals flow for Japan as TV ratings soar.
It's Monday. Let's make a move.
A warm welcome to FIRST MOVE once again. Great to be back with you, and we have lots coming up this hour, including China's tech selloff. Beijing
expanding its regulatory blast triggering a sharp four percent drop in the Hang Seng.
Plus, Lucid's lift off. The luxury electric carmaker debuts on the NASDAQ today. The firm's CEO joins to talk technology, competition, and driving
future growth. So the question is, did I get to show off? Nope. I didn't get to drive off either, but I did get behind the wheel. All that's coming
up.
It's a risk off day two for global markets with China driving sentiment. The Shanghai Composite falling more than two percent, its biggest drop in
months, and the Hang Seng in fact, given the moves that we've seen overnight, too, now down for the year.
U.S. futures also set to pull back from records that I'd argue the crackdown, though, on Chinese tech stocks is a net-net positive for tech
stocks elsewhere. We see rotation out of China into others. Europe, though, a bit softer, too. So, it's not happening at least for now.
The tech turmoil in China involving a sweeping overhaul of its online education sector, it doesn't get more strategic than educating your
children. Those new restrictions include raising more money from abroad, and includes two U.S. listed Chinese tech-ed firms, Tal Education, and New
Oriental lost half of their value on Friday as rumors about this new measures trickled out and they are tumbling premarket once again. Look at
that, you can see it down some 25 and 24 percent, respectively.
Tencent investors also got caught in the crosshairs with efforts to reduce their dominance of the online music streaming market, too. So, we've got
already a splinter net, as it's often called a trade war between China and the United States and beyond. And now what feels like a fracturing of both
capital markets and investment flows between China and the West, too.
Oh, boy, it gets complicated. Let's get more on this in our drivers. David Culver joins us with more. David, great to have you with us. I have to say,
and I said it already, it doesn't get more strategic than how your children are educated and where that data is concentrated and access to that data,
of course, too. But just talk about what we saw overnight -- David.
DAVID CULVER, CNN CORRESPONDENT: Education here has become increasingly competitive at that, Julia. I mean, you've got to think about how much
pressure a lot of these students face, and that's part of the reason the Ministry of Education said that they went ahead with this measure, which is
barring, as you pointed out, any sort of online tutoring for profit, and really education centers as a whole getting any sort of funding on the
stock market.
So, it is having ramifications, but it's also rooted in what is just a massive industry here, with the focus really, for a lot of these parents
putting a lot of money, really for trying to get their kids up to speed and competitive within the education system here. I mean, that's what you see,
with afterschool activities almost entirely dedicated to more schooling.
And so for the Ministry of Education to move forward with this, sure, their perspective is one to ease the burden on kids, but others are looking at
this as a continuation of Beijing exerting its force over the industry. The tech industry at first, of course, a few weeks ago. We saw it coming down
real hard on DiDi, the ride hailing service. They certainly faced the ramifications of going public in the U.S.
Now with these online education centers, they likewise are feeling the brunt of all of this, and it is only expected to continue as Beijing moves
forward with these measures and these regulations. It doesn't seem, Julia, that they're going to be backing off this anytime soon. And if it's really
any focus for some of the other industries that are looking at China, in particular, and any of the other investors, they are going to be hesitant.
Analysts who we have spoken with said, they are going to look at this market and they are going to think twice especially unsure if new
regulations could drop at any moment from Beijing that would shift things for example right here in Shanghai.
[09:05:04]
CHATTERLEY: Yes, I mean, you can see the share price reaction from Friday and today, astonishment. If you thought that there was a risk of a
regulatory crackdown on a Chinese company, you certainly having invested in education, and these companies that are focused on greater education in
China, you weren't expecting it. I think that's the message here, and once again, international investors got burned.
And David, you always bring this back to control. No one is bigger than Beijing, and that's the message being sent to these giant companies, in
particular, technology companies and those that have raised money abroad in order to grow.
What about the backdrop for the talks between China and the United States? I mean, we're coming into it just days off China saying they are unwilling
to have further investigations into the origins of COVID. So, you have to imagine that the tone was already very cool going into this meeting.
CULVER: As you and I have pointed out, Beijing is boss and they like to continue to push that, and it's playing out of the narrative right now
between the U.S. and China and those high level talks that you mentioned happening at the Deputy Secretary of State level, at the Vice Foreign
Minister level. That played out in Tianjin just over the past couple of days. The Deputy Secretary of State, Wendy Sherman heading back to the U.S.
We just heard a short time ago from a readout from the U.S. Department of State and they characterize these talks as productive. They say that the
Deputy Secretary of State was strong in her remarks and really going after China on certain places in particular.
I mean, when we look at human rights and the widespread allegations of abuse in Xinjiang; when you look at, as you pointed out, Julia, the
concerns over the origins of COVID-19, and the lack of a phase two investigation from the W.H.O., essentially saying, international scientists
are no longer allowed to come in here. And then moving out broader to some of the concerns that are playing out in the South China Sea and with Hong
Kong.
It's a myriad of issues that are between the U.S. and China, but they have also pointed out some places that they may be able to cooperate and work
together, namely climate change and battling the crisis that is with climate change right now.
So, these are some of the back and forth that were playing out over these talks, but we're looking towards perhaps even a bigger set of talks. It
could be that Biden and Xi will be getting together in the next few months and having discussions at the leadership level that is yet to be
determined, but these could be the first steps in making that happen.
CHATTERLEY: And we shall see. David, you know, we often talk about, and we have talked about many of these things before, but you're always more
eloquent, I think in describing it. Beijing is boss. That's my takeaway from this conversation, and you're completely right.
David Culver, thank you, as always.
CULVER: Good to be with you, Julia.
CHATTERLEY: All right now to furious protests against new vaccine rules in Italy, France, and Greece. All three countries have launched a Health Pass
to enter bars, restaurants, and other attractions amid a summer surge in cases. All three nations have also made vaccination mandatory for
healthcare workers.
Salma Abdelaziz joins us now. Selma, no surprise here that all three nations taking stringent steps, I think, to try and boost vaccination
numbers, and of course, seeing subsets of people saying, "We don't like it."
SALMA ABDELAZIZ, CNN REPORTER: Absolutely, Julia, and if you're looking at the carrot and stick approach, these governments are definitely taking the
stick approach. Take the U.K. government right now, they are considering increasing these vaccine passports. They want to see potentially, this is
still in the planning phase, but potentially, you'd have to show proof of immunization to go to any event of 20,000 people or more.
This could be rolled out in football stadiums, soccer stadiums during English Premier League events that could come up in just a few weeks' time,
and that continues on a policy that we'd already seen, which is that in nightclubs, you're going to have to show that you are vaccinated from
September.
So, why do this now? Well, the U.K. first of all is concerned about the delta variant. This is one of the only countries in the world to actually
ease restrictions as infection rates are going up. So, this is a way of keeping that layer of vaccine protection strong, keep people getting out
there and getting those shots.
Secondly, of course, they are following the suit of Europe. As you mentioned, France, Italy, also imposing their own form of vaccine
passports, they have different terminology, but same idea. Theirs is actually more strict, Julia, starting next month just to go into a
restaurant or a bar in Italy or France, you're going to have to prove that you have some level of immunization, some level of vaccination.
And finally, of course, the authorities are saying here that people have to live with this virus. It is going to be a part of life. So, we need to find
a way to encourage those who are not vaccinated to get vaccinated so we can resume normal life.
CHATTERLEY: Yeah, Macron was actually pretty potent on this when he was talking to reporters. What is your freedom worth if you say you don't want
to get vaccinated? But if tomorrow you infect your father, your mother or myself, I'm a victim of your freedom. Quite punchy here.
Salma, for those that are protesting, can you give us a sense of why is it that they don't like being told that they have to get vaccinated by the
government, that they don't like the restrictions, or is it again a push back on the science of vaccines?
[09:10:06]
ABDELAZIZ: Julia, there's a whole range of reasons why people are opposed to this, and let's start with France because that's where you began with
the Emmanuel Macron's statement. There are tens of thousands of people taking to the streets over the weekend. A lot of the argument there is the
government is infringing upon my civil liberties.
These demonstrators essentially saying that by the government requiring -- pushing for people to get vaccinated, that could limit their employment
abilities, that could mean they won't be able to get their salaries, and that could mean losing your job. That is what it looked like in France for
those protesters. That's why they were out.
Here in the U.K., for example, we've just heard from the opposition Labour leader, Keir Starmer, who said he supports the idea more of testing, that
that's scientifically a better way to control the virus. He pointed to the example of the British Health Secretary, Sajid Javid, who just a few days
ago, did get COVID. He has now recovered, but did get COVID even though he was double vaccinated. So, for Starmer, he is pointing to testing as being
the way to control the virus.
But let me just give you one example, Julia, of why this does work. In France, after Emmanuel Macron's speech, in France, just 20 hours after that
speech, in a 20-hour period, you had 1.7 million people sign up to get that vaccine, Julia. That was record breaking. It actually almost overwhelmed
the apps and the site.
So, for the authorities there, they're saying, look, this works. This means we can protect vaccinated people, get more people vaccinated, and hopefully
be able to have control of these variants and start to resume normal life - - Julia.
CHATTERLEY: Yes, I just think on these breakthrough cases where people have been vaccinated and still catch the virus, I don't have the numbers
for France. I have them for the United States, and it's a far bigger country, 99.5 percent of those people that are dying are among the
unvaccinated. It's not about getting the virus, it is about whether or not you end up in hospital and dying from it, and this has to be the message.
Salma, great to have you with us. Thank you for that, Salma Abdelaziz.
All right, political turmoil in Tunisia, meanwhile. The country's President has dismissed the Prime Minister and suspended Parliament saying he was
acting to save Tunisia. Supporters celebrating the President's decision, but his opponents are calling it an attempted coup. Ben Wedeman joins us
now with more.
Ben, huge celebrations, also protests in light of this decision. We can debate whether it is secure or not, Ben, but why? Why has it come to this?
Has it come down to COVID? Economic collapse again that we've seen in many nations? And of course, a slow vaccine rollout? People want change.
BEN WEDEMAN, CNN SENIOR INTERNATIONAL CORRESPONDENT: I mean, there's a lot of things going on in Tunisia, but you really have to go back to January
2011 when Tunisia, of course, was the first Arab country to overthrow an aging dictator. And back then, it was thought that with democracy would
come prosperity.
Now, they've had democracy now for more than 10 years, but it's been messy, chaotic, and divisive. In the last 10 years, there have been eight Prime
Ministers, and the people saw that as democracy took hold, the economy really started to stagger.
For instance, last year, it fell by -- it shrunk -- the economy shrunk by about nine percent as a result of COVID. And of course, Tunisia is going
through one of the most intense spikes of COVID cases per capita in Africa at the moment, and therefore, it's just, the situation is chaotic.
For instance, last week, the Tunisian government said, okay, everybody over the age of 18 can come and get to walk in and get vaccinations. But of
course, there were nowhere near the number of vaccinations present for those who were demanding it.
So, we've had unrest in Tunisia for months. The President who was elected two years ago, he is a political independent, and because of Tunisia's 2014
Constitution, he shares executive powers with Parliament and the Prime Minister.
So, right there a recipe for chaos. He only had responsibility, the President that is, for foreign affairs and the military, so he just simply
took the decision, and many say it's not constitutional and that this represents a coup to dismiss the Prime Minister, dismiss the Defense
Minister, suspend Parliament for 30 days and lift parliamentary immunity for many Tunisians frustrated with the state of the country.
This is sort of cutting through the Gordian knot to try to solve the country's many problems. We'll see if it works -- Julia.
CHATTERLEY: Yes. Smart imagery, Gordian knot. Ben Wedeman, thank you very much for that there.
[09:15:08]
CHATTERLEY: All right, let me bring you up to speed now with some of the other stories making headlines around the world.
At least 153 COVID cases and are linked to the Tokyo Olympics, but the Games are in full swing delivering some upsets and surprises and some
exciting firsts. Fans are even turning up for some events despite a spectator ban.
Selina Wang joins us now from Tokyo. Selina, I've been watching it as much as I can. I'm getting excited already. And of course, it does tend to favor
the home nation as well in terms of their athletes. Talk us through what we've seen in terms of medals being given out.
SELINA WANG, CNN CORRESPONDENT: Well, Japan has had some major wins, winning the first skateboarding gold in history and the Abe siblings taking
home gold in Judo; and in other highlights, Great Britain's Tom Daley ended his long wait for gold, winning with his partner in the men's synchronized
10-meter diving competition, and he was in tears on the podium saying how proud he was to be a gay man and how this shows that you can achieve
anything.
Another hotly anticipated event was the women's 400-meter freestyle in which Australia's, Ariarne Titmus overtook Katie Ledecky winning gold,
Australia's first gold in this event in decades.
And Julia, I was able to actually watch some events over the weekend, including Naomi Osaka, who was playing for the first time after withdrawing
from the French Open, and Julia, it was just surreal to see this massive tennis stadium with hardly any people. The only people wearing masks, just
a little bit of clapping, very little cheering, just completely surreal, and she beat her opponent. And afterwards she said that she is feeling
refreshed and happy.
I also watched Simone Biles in which there were some slip ups for Team U.S.A., including a moment when she fell out of bounds. That was a
surprising moment. But of course a few people in the audience, so little reaction there, but she did write on Instagram later, Julia, that she does
sometimes feel like the weight of the world is on her shoulders and that was not her best performance, she said.
CHATTERLEY: Yes, tough, I mean, it is so many things that they are dealing with in this Olympics given the restrictions, given the challenges of
COVID, in addition to just being in and trying to compete and be the best.
Selina, is the mood changing because you and I have discussed many times the protest, the fears surrounding these Games, but I did mention at the
top of the show that the TV ratings are soaring around this. Is the mood changing?
WANG: Julia, it is clear that there is an Olympic buzz and sentiment that is starting to grow in terms of TV ratings. More than 70 million people in
Japan tuned in to watch the opening ceremony, which would be the most watched TV event in a decade. There were people crowded along the triathlon
route in Tokyo even though they are urged to stay at home because of the pandemic.
I've also seen long lines of people waiting to get a photo outside of the Olympic rings near the Olympic National Stadium. But Julia, when I talk to
people, the feeling from residents are still mixed.
There are, of course, people who just want to get as close to the Olympic action as possible who are excited to watch the Games on TV, but there are
also many people I still speak to who say they are worried about the surge in COVID-19 cases, about the more than 150 cases in Japan linked to these
Games, about the low vaccination rate in Japan.
And so some here, Julia, who are feeling the festivities and others who say it's just not the right time to be holding a global sporting event.
CHATTERLEY: Yes, you're always going to get those that are pushing back and are concerned. The game must go on.
Selina Wang, thank you so much for that.
Still to come here on FIRST MOVE. Not meats, not dairy, not milk, but perhaps as close as it gets. The CEO of NotCo, the firm that uses AI to
create plant based foods joins us later.
Plus -- and coming up after the break, it is a huge day for Lucid going public on the NASDAQ today. We've got the CEO in the driver's seat.
(COMMERCIAL BREAK)
[09:21:39]
CHATTERLEY: Welcome back to FIRST MOVE and it's a pretty muted Monday mood on Wall Street with all the major averages set to pull back from records
amid a new round of Chinese tech angst.
U.S. stocks rose to all-time highs though on Friday amid earnings optimism, almost 90 percent of S&P 500 firms have reported profits that beat
forecasts so far. One could say that has something to do with the forecasts more than the earnings themselves, but let's move on.
Fresh reopening concerns hitting airlines premarket. Reuters now saying that the United States won't lift overseas travel restrictions, quote, "at
this point" because of increased concerns over the COVID delta variant.
Dr. Anthony Fauci said over the weekend that the U.S. is now headed in the wrong direction in the pandemic. He says booster shots may soon be
necessary for vulnerable Americans.
Meanwhile, Chinese educational tech stocks taking a nosedive in Wall Street premarket trade as private education firms become the latest target of
Beijing's crackdown.
Joining us now Dan Ives, Managing Director at Wedbush Securities. Dan, great to have you with us. Let's just talk about this first, because I know
we've got a lot of U.S. earnings coming up this week to focus on as well.
But the reaction from these education tech stocks seem to be utter astonishment, perhaps in some way that they were going to be at least
protected in some way from some of the broader concerns in the tech stocks, but it seems nothing is.
DAN IVES, MANAGING DIRECTOR OF EQUITY RESEARCH, WEDBUSH SECURITIES: Yes, I mean, I think that's a great way to put it. This crackdown from Beijing has
been so fierce and the scale and scope has been much more than even, I think, some had feared. And I think that's what you're seeing across the
street.
There is a massive rotation with the Chinese tech names to U.S. tech stocks, because you just don't know what's around the corner on this
regulatory crackdown. Even when you look at the DiDi situation. That was really I think, the straw that broke the camel's back and for investors in
Chinese tech, it's been a nightmare on Elm Street situation.
CHATTERLEY: Yes, I mean, there's two things for me there. I talked about it at the beginning of my show. We've already seen this splinter net
effect. We've got the trade war. And now it seems that we're seeing a broadening of the decoupling of financial markets for any Chinese company
now.
If they come to market and go public in the United States, you have to assume I think perhaps that all the regulatory scrutiny has to have already
happened. But as an investor, I'm just not sure whether you trust that that's taken place.
I mean, do you think we see Chinese tech companies come to market in the United States and anywhere in the West, surely they'd go to Hong Kong now.
IVES: Yes, well, not in the near term. And if you look at the DiDi situation, that is -- I think that's really the silver bullet because you
know, them going public, the regulatory scrutiny that's really been nonstop since and obviously the stock reflects that.
Look at Alibaba, J.D., Baidu and others. You know, I think there's just a broader worry. Of course, you have regulatory scrutiny on U.S. tech, but
the degree to what we've seen in Chinese tech is jaw dropping. And I think it's one where they many of us -- I've come to talk to many investors, not
just in the U.S., but in Asia, it has been a head scratcher, and you just don't know if you own these names tonight, you don't know what's going to
come out tomorrow morning.
[09:25:00]
CHATTERLEY: Yes, as David Culver said earlier, Beijing is boss and they're certainly sending that message. But Dan, the other point that you
mentioned, and I think this is key is that you expect a rotation out of these Chinese tech stocks into U.S. tech stocks, and perhaps even beyond.
That money has to go to work somewhere. And actually, perhaps it benefits non-Chinese tech.
IVES: Yes, I think what you're seeing and you've started to see it, it's just a massive sort of rotation sort of running for the elevators, out of
Chinese tech into U.S. tech stocks. That's why I think also we're going into an earnings season, I think it is going to be robust for U.S. stocks,
I still think U.S. tech stocks are up another 10 to 15 percent, second half of the year.
If you're a global fund manager right now, you know, it's very difficult to sort of look at the red screens, knowing Chinese tech, especially given the
regulatory. I'm not saying some of these names can be oversold, but you just don't know what's coming with Big Brother watching.
CHATTERLEY: We've obviously got Tesla results out after the close tonight. And you can't talk about Tesla without talking about the China risk, too.
You told us in the past, you expect 40 percent of their sales to come from China next year. So, getting over some of these security issues and seeing
where demand is, and stands at this moment in China for Tesla is crucial. Is that what you're going to be watching first and foremost?
IVES: Yes, that's the linchpin, because ultimately, the main reason Tesla has underperformed this year, besides just broader competition as part of
the green tidal wave, it's China. I mean, China is the linchpin to the broader Tesla story over the coming year.
It's been choppy, obviously, this quarter, because of some of the PR and safety issues. The key tonight is Musk sort of giving more granularity
around the China growth story, Model Y sales, what they expect second half of the year. And I view this as a positive pad always because I do think
China, despite some major speed bumps, I think they've gotten through and maybe better than expected, and I think now all the focus is on the China
growth story for Musk and Tesla.
CHATTERLEY: What about -- I mean, we talked about profitability where Tesla is concerned, but we should talk about net income, because, you know,
I was looking again, at the numbers, they never exceed the money that they get from selling tax credits -- regulatory tax credits to other automakers.
And I know it's something that gets discussed every quarter with Tesla, but when the stock and you've said it already is down some 30 percent from the
highs, is that concern already and more than already in the price? And do you see value at these levels?
IVES: Yes, I mean, that's been a concern as well as just the Bitcoin U- turn and that's really become a sideshow, and it's a bit of an overhang in the Tesla story, but when you talk about tax credits, it is something where
it is going to really sustain for the next few years, but it does come down to investors wanting to see profitability on selling cars. That's something
we expect into the next year.
When I look at the risk reward on Tesla, obviously, it was a Cinderella story last year in terms of the stock, we have the thousand dollar price
target. I still think, it is part of this green tidal wave, fourth industrial revolution, it continues to be the major way to play, EV, along
with some of the Chinese players, GM, and the broader supply chain that is being built out in the U.S.
CHATTERLEY: Amazon was also in the news over the weekend and this morning amid rumors that they are potentially at some point going to create
infrastructure to allow Bitcoin and crypto payments for their products. We don't have to discuss the likelihood of that or not, quite frankly, but do
you think the likes of Amazon and Apple post results this week end up higher?
IVES: Oh, yes. I mean, I view this as really a Nirvana situation for big cap tech. I think what we're going to see from Apple, Amazon, and others,
Microsoft is just blowout earnings. And I think that's what puts the fuel in the tank in terms of this next leg of the tech rally, and that risk on
is there as a greenlight to own tech and I still think you look at Apple, we are looking six to nine months from now, a $3 trillion market.
CHATTERLEY: Wow. No stopping them. Dan, great to chat with you. Happy Monday. Thank you for joining us.
IVES: Thank you.
CHATTERLEY: Dan Ives there, Managing Director at Wedbush Securities.
The market opens next. Stay with us.
(COMMERCIAL BREAK)
[09:32:17]
CHATTERLEY: Welcome back to FIRST MOVE and U.S. stocks are up and running this Monday as we kick off the last trading week of July, and it's a lower
open to begin the week with stocks pulling back from recent records. Lots of challenges for investors ahead including the stance of tech earnings
season and a new Fed policy statement out Wednesday, too.
Uncertainty over China's ongoing tech crackdown also having an impact on sentiment as well. Look at that in terms of the underperformance of those
tech education stocks. Beijing is now issuing fresh rules to limit the growth of its online education firms. Shares of U.S. traded Tal Education
and New Oriental, as you can see there, both tumbling and continuing their losses from Friday. Other U.S. listed Chinese tech shares like Baidu and
Alibaba also under pressure early on in the session.
Now from China, penalty fears to Wall Street IPO cheers. A number of high profile names set to debut in the United States this week. Robinhood is
expected to begin trading Thursday under the ticker symbol HOOD.
Lucid Motors is revving up on the NASDAQ today, meanwhile. The latest company to go public in a SPAC or Special Purpose Acquisition Company deal.
Lucid Motors CEO Peter Rawlinson just ringing the bell at the NASDAQ this morning, too, and ahead of their listing, I caught up with him at our
Hudson Yards studio and asked him what this moment means.
(BEGIN VIDEOTAPE)
PETER RAWLINSON, CEO, LUCID MOTORS: Well, it's another big step for the company, Julia. But the real culmination of all this, what I'm aiming for
is get this car, this beautiful car into production, make the best electric car in the world out of our factory in Arizona. It's a landmark for the
company, but I'm looking to start a production. That's the big litmus for me.
CHATTERLEY: Well, as exciting as this is, you have had some fun and games getting to this point. Just talk us through it.
RAWLINSON: Well, yes, we're on track and we are really looking forward to ringing the bell on NASDAQ on Monday. But yes, our particular merger has
attracted a lot of interests from the retail sector, and that's been really great.
There are so many retail small investors really attracted to the whole future of sustainable mobility. But with that brings its own peculiarities.
CHATTERLEY: So anybody that said, look, this maybe was because they've looked at other EV companies that are struggling, perhaps the price has
gone down. You're saying it was never about that. It was simply about the technical aspects here of younger perhaps newer investors knowing that in a
case like this, they actually have to vote for something to go ahead.
RAWLINSON: Oh, and of the folks, there was a vast overwhelming majority of votes for the merger. It was just getting those votes in and reaching those
people and I think that somewhat, there's a message here, there's some learning how the system could be improved in the future.
[09:35:13]
CHATTERLEY: Maybe Robinhood needs to be -- had a word with and there needs to be like an alert, perhaps on the app.
RAWLINSON: Absolutely. And I think they did respond in the end, and I think that's what really helped us in the end.
CHATTERLEY: I mean, listing is just one piece of the jigsaw puzzle to your point. And I know a lot of people have said to you look, listing is great.
We've discussed it in the past, it's about getting money, and it's about ramping up investment and production. But to your point, getting people
driving these vehicles, that's the real moment.
RAWLINSON: Absolutely, getting them, driving them, loving them, loving experience, and really help the transition to sustainable mobility that the
world really needs.
CHATTERLEY: What car are we standing behind? Just explain this one.
RAWLINSON: This is the Lucid Air Dream Edition. And this is the limited run that is sold out, which is going to start our production from our
factory in Arizona in the second half of this year.
CHATTERLEY: So, someone could actually be driving this car this year.
RAWLINSON: Very soon, and I'd be driving them regularly.
CHATTERLEY: It's great.
RAWLINSON: Let's go to the test procedure. Someone has got to do it.
CHATTERLEY: It's a hard job, but someone has to do it. So, you are going to be there ringing the bell on Monday.
RAWLINSON: I'm looking forward to ringing the bell.
CHATTERLEY: To ringing that bell.
RAWLINSON: On NASDAQ come Monday.
CHATTERLEY: And just to be clear, what difference is this money going to make?
RAWLINSON: Well, really, it secures the future of the company. We've raised $4.4 billion and you know, if you look back when Tesla IPO'ed, they
raised about $300 million, we've raised about 15 times that. That really secures the future of the company, and it means that we can plan for rapid
trajectory of growth and that is what's needed to accelerate this vital transition to sustainable mobility.
And it's the technology of cars like this, which is really going to lead that journey, the most high tech electric car in the world, Lucid Air.
CHATTERLEY: And for those that say, look, the demand isn't there yet. You're at the early stages of the growth of this market and the kind of
demand that you're talking about, never mind the challenges of manufacturing. The competition out there, step two, what do you say?
RAWLINSON: I say technology is king. This is a tech race. And the traditional car companies don't seem to recognize this is a technology
race. We have a car here, which is ultra-high tech, over 900 volts, over 500 mile range. One of the most aerodynamic cars in the world, sleek,
incredible driving experience. I want the competition. I thrive on it, bring it on.
CHATTERLEY: And so Peter, whichever way the stock trades on Monday, be it higher or be it lower, what's your message at this moment to investors?
RAWLINSON: I'm not myopic about short term trends. The real value of Lucid Motors is in the long term based upon our tech. And with the $4.4 billion
that we've secured, we can propel ourselves on a trajectory of growth for the next decade.
This is a long term play. I'm in this with a whole team for the next decade. We have a 10-year plan to propel this company.
CHATTERLEY: Is this the moment where we get to drive it?
RAWLINSON: Yes, let's get in.
(END VIDEOTAPE)
CHATTERLEY: I got in, but I didn't drive it, yet. The Lucid CEO did talk me through what he was talking about there, though, which is the unique
technology capabilities. Just watch this.
(BEGIN VIDEO CLIP)
RAWLINSON: Julia, you're looking here at the Lucid Air Dream Edition, and this car is resplendent in its signature gold color. Dream Edition is
available in three colors -- gold, black, and white.
CHATTERLEY: And it has a Dream price tag, let's be clear. On the road, how much are we talking?
RAWLINSON: Well, the price is $169,000.00. But it's a thousand horsepower car. It is extraordinary range. It is extraordinary performance.
CHATTERLEY: Who are you trying to appeal to with the Dream?
RAWLINSON: The archetypal customer who would probably be currently driving a Mercedes Benz or a high-end Audi or a Porsche because they want a true
luxury electric vehicle.
So here we are in the cockpit of the car where we are really sort of fusing art and science and software and hardware in the line of sight of the
driver really to optimize safety. And we have the deeper more immersive functions on this pilot panel here. And the pilot panel itself is
retractable to allow storage space for valuables and you can retrieve your pilot panel this way.
Well, these are the 21-inch wheels, which is special edition for the Dream Edition. Super aerodynamic. What an art form wheel in its own right.
CHATTERLEY: Aha. Definitely room for spare shoes.
RAWLINSON: So we have here the frunk, the front trunk.
CHATTERLEY: The frunk.
RAWLINSON: We have multi-lens array headlights. We have nearly 9,000 micro lenses to these headlights and they are computer controlled.
[09:40:10]
RAWLINSON: So, we have a digital switching to change the direction of the light beam, and that digital switching is linked by software to the angle
of the steering wheel, so you can actually turn the lights with no moving parts.
CHATTERLEY: What about orders for next year?
RAWLINSON: Well, we've got a bulging order book now taking us right through into next year.
(END VIDEO CLIP)
CHATTERLEY: It's all about the extra shoe space.
Okay, coming up after the break, using AI to come up with new vegan food. A star-studded lineup of backers turns a Chilean startup into a unicorn. We
speak to the CEO of NotCo, next.
(COMMERCIAL BREAK)
CHATTERLEY: Welcome back to FIRST MOVE. What did cabbage, pineapple, and peas have in common? Well, you can use them to replicate cow's milk. Well,
maybe not everyone can, but a Chilean food tech startup called NotCo apparently can. It uses AI to identify the optimum combinations of plant
proteins when creating vegan alternatives to animal based products.
In its latest round of funding, it has raised money from the likes of Jeff Bezos, Lewis Hamilton and Roger Federer, among others. NotCo is now a
unicorn with a valuation of $1.5 billion.
And I'm pleased to say we're joined by the founder and CEO of NotCo, Matias Muchnick. Matias, fantastic to have you on the show, and congratulations on
the latest funding round.
I remember you coming on the show about six, seven months ago and we were just talking about what your company did and what you made and what made
you unique. Just start there once again for viewers that may not be familiar with your company. How does it work?
MATIAS MUCHNICK, CEO, NOTCO: Sure. Thank you, Julia for having me again. It is a pleasure to be talking to you after only eight months of the last
interview we had together. We were celebrating that round only eight months ago.
So well, NotCo is a company that is using artificial intelligence to really understand the world of, you know food, understand the world of plants and
create an algorithm or we develop an algorithm that is allowing us to predict which combination of plant based ingredients should result in the
same sort of experience as the target products.
So, we want to take the animal out of the equation. We really want to get more sustainable, you know, products out there, democratizing our plant
based products to all over the world. And yes, so the approach is pretty much a tech based company that is allowing us to produce products faster,
better, and more accurate, and less costly than anyone else in the space, planning for different categories of products in six different countries.
And basically, you know, this round is to support a little bit the operations that we already have in this world, you know, especially in the
Americas, Chile, Argentina, Brazil, the U.S., and then you know, looking at Asia and Europe as the next geographies to disrupt.
CHATTERLEY: I mean, and to be clear to our audience as well, I mean, you've only been going for five years. So, this kind of growth progress is
pretty phenomenal.
And I think also what people need to understand and what makes you unique compared to some of the others that are going for plant based food is that
instead of going for milk or dairy products, or meat, you decided to tackle all three at once using Giuseppe, which is your AI program to create these
alternatives and just said, you know what, we're just going to blast onto the market and try everything.
In your press release, you describe explosive growth. Put some numbers on that for me, please. What are you seeing? And where?
MUCHNICK: Sure. You know, what say and I think it's very important to actually get it clear in the sense of what brings NotCo to the table, but
all of the rest can't. It's a very tech-oriented company. So at the end of the day, it's not only that we're using technology to create our own
products, that would be we Not Milk, Not Burgers, it would be also potentially become, you know, an Intel inside of other companies. Right?
So, I don't know if others are asking us to use our technology to create their own products, right? So that's a little bit of what brings us to the
table, that maybe it's very new to the space, right? This is what really NotCo to the core is, you know.
And so, yes, you know, the whole idea here is to really grab our hands because definitely the change that we need in this world is not going to be
produced only by us, it's going to be produced, if we hold our hands together, with all of the rest as well. So I think NotCo's value
proposition as opposed to all the other players is exactly that, having the potential to affect and to be the catalyzer of change of other companies
that have decided not to become the blockbusters of this world, but more of the Netflix, right?
CHATTERLEY: So, I love that statement. So just to be clear, based on what you were saying there. Are you already in discussions with big food
producers out there to perhaps adopt your technology in order to create products under their own name brands? And can you name some of those
people? I'm sure I know what your answer is going to be, but I am going to ask you anyway.
MUCHNICK: I cannot disclose who they are. But definitely the inbound interest of multinational companies to create products starting from the
technology of NotCo has been unbelievable this last few years, and especially the last few months, right, that we launched in the U.S., that
we launched nationwide, that we're reaching 8,000 stores with the product Not Milk, kind of like we started to exist in the conversations of the
global multinationals.
So definitely, we are going into that space. We cannot discuss at the moment who they are, but we'll definitely be talking to you hopefully,
Julia, in the next couple of months about this.
CHATTERLEY: That's a date, by the way. People will be, I think watching this, and you know, I mentioned pineapple, peas, cabbage and going -- I'm
not quite sure how that works in terms of taste, color, smell for milk, but that's part of the science of this.
So there's two things. There is replicating texture, taste, and then there's sustainable -- sustainability. There's the health aspects, and I've
got some stats here. So I can cover one side.
You say that the plant based milk uses 74 percent less energy, 92 percent less water, and produces 74 percent fewer emissions than regular milk
production. What about health? That's the sustainability part. Is it healthier than traditional milk?
MUCHNICK: Yes, this is a very important question. And I think there's many reasons why people become plant based, right? So one might be
sustainability, purely sustainability. The other is care for animal welfare. Third, because of health reasons, right?
It is studied and over studied and over confirmed that if we're talking about milk itself, it's a very inflammatory process of digestion when you
consume dairy based products. It is associated with a lot of diseases and more health issues than we ever expected or we ever knew 20 years ago,
right?
In that regard, we need to understand what healthy means, right? Because it's a very subjective topic or it is objective, but it has different
dimensions of how do you conceive a product being healthy? Is it a nutrition fact label? Is it fats? Is it calories? Its sugars? Right?
Is it you know, inflammatory process after you read it? It is a bioavailability of nutrition. So, it's a very rather complex question.
[09:50:10]
MUCHNICK: Now, if we narrow down to the physical and chemical properties of a product, then our milk is very, very similar to cow's milk. So we
always tend to create or replicate products with all of the good and reduce all of the bad, right? So that's a little bit of why we want to conceive.
It's a product that is first and foremost, tasty. So you know, it's a replica when we drink, Not Milk, it's very milky and then the experience,
and then the price points, which is the idea to really kind of like penetrate the mass market. Otherwise, we are not complying with the mission
of the company, which is really in need of sustainable use of resources. So, yes, nutrition is a big part of what we do.
CHATTERLEY: Yes, the plan is not to be niche. I have about 20 questions that I still haven't asked you. So it's going to be a shorter time than
eight months when I get you back, and we'll talk about the growth plans and congratulations on the fundraise.
Always great to chat to you, Matias. Thank you. The founder and the CEO of NotCo there.
MUCHNICK: Thank you, Julia.
CHATTERLEY: Great to chat.
Okay, has Bitcoin got its mojo back? Well, we'll discuss what's behind the latest surge.
(COMMERCIAL BREAK)
CHATTERLEY: Welcome back to FIRST MOVE. An amazing run for Bitcoin -- Amazonian stone run -- the cryptocurrency jumping to nearly $40,000.00, its
highest level in more than a month. As you can see, it has eased back, slightly still up 11 percent.
The reason for the upward move is unclear, but as always with crypto, speculation is utterly rife. Clare Sebastian joins us now.
Another day, another rumor. This time just like my poor attempts there, it does involve Amazon. It is one report in a paper that isn't in the United
States, and it also involves a posting for a job listing. Clare, tell us what happened here potentially.
CLARE SEBASTIAN, CNN BUSINESS CORRESPONDENT: Yes. So if you read this job listing, Julia, it is actually easy to see why people are getting excited
about this. This is a job listing on Amazon Jobs for a digital currency and blockchain product lead. Actually, it's the only job listing on the site
that contains the words "digital currency." So, this is something interesting.
Also, if you look into the details of the job, it talks about someone to join the Amazon payment acceptance and experience team and they want the
person to develop Amazon's digital currency and blockchain strategy and product roadmaps. That suggests that they really want to get serious about
developing something. It doesn't prove anything, of course. It contains the word strategy and roadmap, which suggests this is still an ongoing project.
But it shows Amazon is potentially getting serious about this.
But the moves we're seeing in Bitcoin and other digital currencies, they really have been brewing for the last week since we heard those bullish
comments from Elon Musk saying that Tesla might move to re-accept Bitcoin for car payments from Jack Dorsey, the CEO of Twitter saying that he wants
Twitter to lead the way in the sort of future of a native currency of the internet, which he thinks will be Bitcoin.
So, we're seeing all of that after several months of course, where regulation has been the talk of the crypto market and that really has been
dampening down the mood.
[09:55:11]
SEBASTIAN: And add to that of course, the market technicals. This is a market where there's a lot of short selling, and I think we are seeing
perhaps a bit of a short squeeze today which is pushing the price up even higher.
But, over the course of this year, Julia, important context, they are still about 40 percent down from the highs that we saw in April.
CHATTERLEY: Yes. I mean, they are a huge payment and logistics company. If they are going to adopt crypto or Bitcoin, it would be a huge development,
but we don't have confirmation of that yet, and they should be looking at the benefits of blockchain technology, so we can't predict an Amazoin --
Amazon coin any point soon, Clare?
SEBASTIAN: I mean, never say never, Julia with Amazon, but --
CHATTERLEY: Awesome.
SEBASTIAN: But as I said, they are talking about a strategy. This is a roadmap. They are, I will say, quite deep into blockchain already. AWS has
a blockchain management service. If you look on the job site, which I did today, there are 74 full-time openings which contains the word
"blockchain."
So, they are quite heavily into that, but you know, you've got to be careful if they are going to do this, they have to get this right.
CHATTERLEY: Yes, as you would expect. This is my trading strategy for that. Lots of dots connected, Bitcoin, higher. The end.
Clare Sebastian, thank you so much for that.
That's it for the show. Stay safe. "Connect the World" with Becky Anderson is next.
It's good to be back and I'll see you tomorrow.
(COMMERCIAL BREAK)
[10:00:00]
END
