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First Move with Julia Chatterley
Couple Charged with Conspiracy to Launder Crypto; PM Johnson: England Could Soon End COVID-19 Restrictions; Canadian Trucker's Protest Threatens U.S. Supply Chains; U.S. Star Shiffrin Out of Second Event at Winter Olympics; Ukraine's Second-Largest City Prepares for Possible Attack; Maersk Delivers Strong Earning Amid Supply Shortages; GlobalFoundries' Q4 Results Beat Wall Street Estimate; Pandora Launches Pandora Brilliance; China's Winter Sports Industry. Aired 9-10a ET
Aired February 09, 2022 - 09:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
ALISON KOSIK, CNN ANCHOR: Live from New York, I'm Alison Kosik in for Julia Chatterley. This is "FIRST MOVE." And here's your need to know.
Record seizure. A New York couple arrested as the Feds recover $3.6 billion of stolen cryptocurrencies.
Restrictions easing. Boris Johnson signals an early end to all COVID restrictions in England.
And supply chain fears. Protesters block a key trade route between the U.S. and Canada.
It's Wednesday. Let's make a move.
A very warm welcome to "FIRST MOVE." Great to have you with us.
Let's begin with a look at the global markets. And it's a risk-on day for much of the investment world.
U.S. futures are solemnly higher after Wall Street's across-the-board gains Tuesday.
Europe on the rise as well after a profitable session in Asia.
Despite all volatility of recent weeks, the S&P 500 is now trading flat for February so far.
And the Dow, it's just 4 percent away from all-time highs.
All this despite continued uncertainty over Russia's intentions over Ukraine.
A mixed earnings picture for Big Tech and the rise in global bond yields, which make it more expensive for everyone to borrow.
U.S. 10-year yields are easing a bit today, but still a close to 2 percent levels. German yields look lower today as well after 11 straight days of
The big test for fixed-income markets, that's coming tomorrow when we get the latest look at the U.S. consumer price inflation. That's expected to
hit highs we haven't seen since the early '80s.
Let's get right to the drivers.
A couple from New York have been arrested on charges of conspiring to launder $4.5 billion in stolen cryptocurrency. Ilya Lichtenstein and his
wife Heather Morgan were arrested on Tuesday after a six-year investigation into the hack of a virtual currency exchange. The attorney general's office
has described it as the department's largest financial seizure ever.
Sean Lyngaas joins us now.
So Sean, I understand it's been six years since that bitcoin was stolen and now this arrest.
SEAN LYNGAAS, CNN CYBERSECURITY REPORTER: That's right. Investigators followed the money and, in this case, the blockchain. Alison, you know, the
bitcoin, there's a record of these transactions despite the reputation of digital currency giving anonymity to people online. It's actually quite
And this is an example of how the FBI and other investigators are able to track some of the movements of this currency and the people that were
And I've been covering cybersecurity for several years now and virtual currency. And I have to say this is one of the more bizarre stories that
I've covered because it involves a amateur rapper, the -- Heather Morgan, one of Accused, has a YouTube video in which she's rapping, talking about
bitcoin and calling herself the expletive crocodile of Wall Street.
And then this young couple is also very entrepreneurial. And you know interested in cryptocurrency. And I suppose you could describe them as
CNN was not able to reach them for comment, but they made their first court appearance yesterday in New York. Alison?
KOSIK: Very interesting video we're watching there. The funny thing is that's right outside the New York Stock Exchange where she is -- she filmed
One thing to comes to mind, you know you talked about how this is all very trackable for authorities, but it did take six years. And those who lost
that bitcoin, what recourse do they have?
LYNGAAS: That's a great question, one that we posed yesterday to the Department of Justice during a press call. The Justice Department official
not wanting to weigh into that too much because it's an ongoing investigation. They did indicate they're going to try to sort of make those
victims whole by tracking down the money and hopefully getting it back to some of the victims.
I would also point out, Alison, that they haven't announced charges against who actually hacked the cryptocurrency exchange. So that seems to also be
under investigation. But a lot of money. The price of bitcoin is constantly fluctuating, but like you said, this is the largest seizure the Justice
Department has ever done. And so, I think victims are going to be wondering where their money is.
KOSIK: Yes, still lots of questions about this one.
Sean Lyngaas, thanks so much for all of your reporting.
England could soon do away with all coronavirus restriction including rules around self-isolation for people who test positive for COVID-19. British
Prime Minister Boris Johnson signaled the move during today's parliament session.
(BEGIN VIDEO CLIP)
BORIS JOHNSON, BRITISH PRIME MINISTER: Provided the current encouraging trends in the data continue, it is my expectation that we will be able to
end the last domestic restrictions including the legal requirement to self- isolate if you test positive, a full month early.
(END VIDEO CLIP)
KOSIK: Salma Abdelaziz joins us now from London. Salma, so what's behind this decision?
SALMA ABDELAZIZ, CNN REPORTER: Well, let's go through what the decision is first of all.
So all restrictions were set to be lifted March 24th. The prime minister is saying that now could happen a month early, as in it could end by the end
of February. By and large, restrictions have been lifted here though, Alison.
Masks are not mandated. The streets are full of people. People are back at work. Essential businesses are functioning. This really comes down to the
requirement to isolate and to travel rules.
So right now, if you test positive for COVID-19, you have to isolate for five days. That would be lifted. You would no longer be required to
Now, the prime minister says that's because the data is good. And if it continues to be good, then he can lift those restrictions. But it does come
as a surprise because infection rates are still high. There was over 300 deaths -- I have down over 300 deaths just yesterday. In the last seven
days, deaths have increased as well. So there is some concern.
I want to pull up a quote for you from one of the bereaved groups. These are family members of people who have died of COVID-19 in this country.
We're going to pull up that quote for you.
"The prime minister might wish that this disease was no more dangerous than the flu, but the reality is that he is throwing the most vulnerable in our
society to the wolves. Once again there seems to be a failure at 10 Downing Street to recognize what their own COVID-19 policies mean for others in
comparison to themselves."
Once again, that's the key part here, Alison, because the prime minister right now is embroiled in this Partygate scandal, so his critics are saying
the prime minister is doing this because it's a popular move, right. Let's lift all COVID restrictions, something to distract from the fact that he's
literally fighting for his political life right now. Alison?
KOSIK: Yeah. As the prime minister announces these restrictions lifting early, some new pictures about Partygate are coming to light?
ABDELAZIZ: Absolutely. This was discussed in parliament today. A picture has leaked to one of the local papers here. It appears to show the prime
minister at one of these alleged events in question, December 2020.
It was a time in which there was apparently a quiz that was held at 10 Downing Street. You can see people in the picture with tinsel, dressed in
very festive December-like clothing. But the key part is, there was a big bottle of champagne, it appears, on the table.
Now, CNN is working to verify this latest image, to verify these claims. But again, it adds to that reputation, to that image of a government that
it was essentially partying it up during lockdown. You have 16 different gatherings now that are under question, an investigation which a
preliminary report, a summary report was released.
Sue Gate -- Gray report, rather, last week, found failures of leadership, failures of judgment, excessive drinking at 10 Downing Street. There's
still a police investigation that is ongoing. The prime minister, of course, was asked about this picture in parliament, evaded the question and
said you've got that wrong and moved on.
And that's really been his strategy here, Alison. As you saw with this announcement about COVID restrictions being lifted, as you saw with his
reaction in parliament to that question. It is distract and delay, move on and talk about anything but Partygate. But this is not going to go away for
the prime minister.
Again, a police investigation still underway. His party right now really deciding what to do with their man, with Prime Minister Boris Johnson.
KOSIK: Yeah, not so easy to distract and deflect when new pictures come out, you know, on a weekly basis.
Salma Abdelaziz in London. Thank you so much.
A trucker protest over COVID-19 restrictions that started in the Canadian capital Ottawa last month is beginning to disrupt American supply chains.
The Freedom Convoy is now blocking a critical connector between the U.S. and Canada. And a turmoil could soon start affecting American wallets.
Paula Newton joins us now. Paula, great to see you. I know you've been covering this from the start. It's been going on, what, more than two weeks
now, and now it's becoming really disruptive.
PAULA NEWTON, CNN CORRESPONDENT: Yeah, I mean, the escalation continues. And again, this movement, Alison, seems to have a momentum all its own. You
mentioned there what was going on, on that bridge. I mean think about it, Alison, this actually -- this bridge is responsible for some people say a
quarter in a year of all the trade between U.S. and Canada.
And just to give you an idea. If we just take the auto industry, Alison, apparently if you're making parts for those automobiles, for one vehicle
those parts can literally cross the border back and forth hundreds of times just to make one car.
That is what is at stake here. I have to tell you protesters obviously know that which is why they're at the bridge.
And right now, authorities are trying to figure out what to do. They say they do not want to have a confrontation. At the same time, it is escaping
no one, especially at the White House with the Biden administration, what this could mean for already strained supply chains.
What do these protesters want? You know, you just heard Salma talk about how the U.K. is back to we'll call it normal, whatever that is, Alison,
right? I mean, people here in Canada say, look, they've been compliant. They are vaccinated. A lot of them are vaccinated. Some of them are against
vaccine mandates. They just want it all to go back to normal.
Prime Minister Justin Trudeau really reluctant to insinuate himself in this, saying, look, I'm not going to be negotiating with angry crowds.
At the same time, you know we're keeping wary eye, Alison, on other border crossings. I think protesters here have seen an Achilles' heel and are
wondering that, look, they seem to be able to sow chaos, Alison, wherever they go. And authorities reluctant to do anything.
Many people are fed up. Alison, I want to say this is a vocal minority, but it is a minority. And many Canadians including beleaguered health care
workers are starting to say, look, enough is enough. And when you start to think of all the supply chain disruptions that we've already had, the fact
that this could lead to more, this is really a state of crisis on both sides of the border. Alison?
KOSIK: Any signs of them giving up anytime soon or is this -- they're going to stick it out for much longer, you think?
NEWTON: I mean, Alison, they are supplied whether it's here in the downtown core in Ottawa, and I know people have seen the pictures from here, or on
those bridges. They say they have food. They have fuel. They will stick it out.
I will say -- and I hate to use any hyperbole here. They say, well, if someone points a gun at me, I've heard that said before.
But Alison, short of really trying to negotiate your way through this, this will go on for some days.
They're you know -- it's like an old-fashioned sit-in really that you're used to seeing. It's a truck-in, and they're prepared to use it. They're
also, you know, they say that they come through peace. They want this to end.
You know I was just looking at a video from the bridges, Alison. There are people playing a pickup game of hockey there. That will give you the idea
of how long they're going to be stuck in.
KOSIK: Clearly, they're finding creative ways to pass the time. And it means that we will continue coming back to you for your great reporting.
Paula Newton, thanks so much.
Now to Beijing where the Winter Olympics are underway, and the U.S. skiing superstar Mikaela Shiffrin suffering another big disappointment.
Selina Wang joins us live from Beijing.
You know, it's hard to not feel her heartbreak and watching how the events unfolded for her.
SELINA WANG, CNN CORRESPONDENT: And Alison, you could hear in her voice. This is two bitter disappointments in just three days. On Monday you saw
her crush out of the course in her first attempt. And now again, on her opening attempt, she was skiing off the line. These are some of her best
events, some of her best opportunities to medal. But she said the nerves were high, the pressure was high.
And this is what she had to say. She said, quote, "It's a letdown of everything, letting down myself, letting down other people. I will try to
re-set again, but I also don't know how to do better because I just don't. I have never been in this position before and I don't know how to handle
And Alison, heartbreaking. She also said she's now second-guessing everything. She's second-guessing her career, her technique, everything
that she's done for more than a decade. Huge mental pressure on her.
But in brighter news for Team USA, Team USA winning its first gold in snowboard cross. Lindsey Jacobellis, she's 36-years old. She's had near
misses in previous games, but now, for her fifth Winter Olympics, Alison, this is amazing. Finally topping that medal podium.
KOSIK: Congratulations to her.
All right. What is the reaction in Beijing to Eileen Gu and Zhu Yi? Why is there such a contrast there?
WANG: Yeah, Alison, this is really fascinating because they are both born and raised in the U.S. but competing for Team China. But the reception in
China, the reaction could not be more different.
Eileen Gu of course stealing the gold, huge talent there. She's being praised on state media as being an idol for the world. Compare that to Zhu
Yi who is an ice skater and she fell during her competition and then was called a disgrace on Chinese social media.
Eileen Gu not being just praised for her talent but also for speaking fluent Mandarin. And for understanding the culture. Zhu Yi being shamed for
not speaking the language fluently.
Now, it's important to mention that it is common internationally for people to change citizenship for sport. In fact, for these Winter Olympics, China
has more than a dozen foreign-born athletes that are competing for Team China.
But these athletes of Chinese descent, they are often put under the microscope. And they do face this relentless scrutiny.
And Eileen Gu, too, she's also walking this tightrope internationally. She has faced criticism for what some say are putting profits and these big
sponsorships while -- prioritizing that while staying silent on Chinese human rights record. She has dodged questions as well about her
Now, this is as of course she has been trying to portray this message that she's trying to bridge cultures, that she's proud of both her American and
her Chinese background. And she said she's competing for Team China in order to promote sport in the country. That she even wants to bridge and
forge friendships between nations.
Alison, that is a very difficult task amid rising U.S.-China tensions. And here in China, she's really the poster of these Beijing Winter Olympic
games. And some say she's even more than that. She's also a projection of China's soft power. Alison?
KOSIK: So many pressures on these athletes.
Selina Wang, thanks so much.
And these are the stories making headlines around the world.
The leaders of France, Germany, and Poland have met in Berlin to discuss Russia's standoff with Ukraine. In a statement, they urged Moscow to de-
escalate tensions and warned of severe consequences if it attacks.
The British foreign secretary is expected to repeat that message to Russia when she visits Moscow later.
While Western politicians work for a diplomatic resolution, people in Ukraine are preparing for the worst. And in the country's second-biggest
city, they have reason to be uneasy.
CNN's Sam Kiley reports.
SAM KILEY, CNN SENIOR INTERNATIONAL CORRESPONDENT (voice-over): Kharkiv is Ukraine. Glory to Ukraine. Russian troops and ships muster on land and at
sea. And few places in Ukraine feel more vulnerable than Kharkiv.
KILEY (on camera): Here is only 30 miles from the Russian border. It's a city of about a million and a half people. At least 75 percent of them
speak Russian as a mother tongue. Demonstrations like this are important because this city could be one of the first to get attacked in the event of
KILEY (voice-over): Volodymyr Zelensky, the President, has warned as much. And U.S. officials are saying that Vladimir Putin could order an attack at
ANNA ZYABLIKOVA, KHARKIV, UKRAINE RESIDENT: Every day I'm trying to be calm and I'm trying to go through my daily routine. But I'm trying to have the
thought, OK, where are my documents? Where is food? Where is my mom? Do I have enough money?
KILEY (voice-over): In a city that's been identified as a potential Russian target by the Ukrainian President there are attempts to carry on as normal.
But for many, this is the new normal.
VIKTORIA MAKARA, KHARKIV, UKRAINE RESIDENT: I don't want to flee. So I need to protect the city, my home, my family.
KILEY: Ukraine has expanded its military but it's a long way behind Russia in military might. So it's taking these wrecked T-64 tanks from the 1960s
and rebuilding them from the chassis up to rush to the frontlines, much like Ukraine is trying to build and defend a democracy in a landscape, much
haunted by the Russian-dominated Soviet Union.
Sam Kiley, CNN, Kharkiv.
KOSIK: Thank you for clarifying.
Denmark's queen and the king of Spain have both tested positive for COVID- 19 according to palace statements.
Queen Margrethe has canceled a winter holiday and is staying at a palace in Copenhagen where she's displaying mild symptoms.
In Spain, King Felipe VI whose symptoms are also mild has suspended his official activities for seven days.
Coming up on "FIRST MOVE."
Full steam ahead for the shipping giant Maersk. Plotting a course through the pandemic and capitalizing on supply chain issues.
And as the semiconductor shortage continues into the new year, we'll take the view of chipmaker GlobalFoundries.
KOSIK: Welcome back to "FIRST MOVE." I'm Alison Kosik.
U.S. stock futures remain solidly higher with tech set to build on yesterday's strong 1.2 percent rise. Investors hoping that robust earnings
can keep the upward momentum going.
Twitter, Coca-Cola and Pepsi report their latest results tomorrow.
Disney reports results after the closing bell today. The company's streaming revenues will take on added importance after Netflix reported
disappointing quarterly subscription growth and weak guidance. Shares of Disney have fallen 25 percent this past year and they are down 8 percent
for 2022 so far.
Meantime, shares of Facebook parent company Meta are on track to rise for the first time in five sessions. Meta's market cap has fallen below $600
billion after the company's mega earnings disappointment last week.
Shipping giant Maersk has had a blockbuster 2021. Thanks to global supply issues that related to the pandemic. Congestion at ports, container
shortages, and a surge in demand have all driven growth and profitability for the company. Maersk is predicting more of the same before the situation
eases later in the year.
Let's get more and bring in Soren Skou. He is the CEO of Maersk.
So grateful for your time today. Thanks for joining us.
SOREN SKOU, CEO, MAERSK: Thanks for having me.
KOSIK: So your earnings basically show that, you know, the disruption in the supply chain has been working in Maersk's favor, bringing in record
revenue in 2021. But you know, this is much the same for the global container firms as a whole. How does it feel that you're bringing in this
kind of revenue on the back of rising prices that are actually hitting consumers so hard?
SKOU: Well, our situation is actually that we have never had as high customer satisfaction scores as we had leaving 2021. We have worked very
hard to help our customers in what has been for them a very difficult situations with their global supply chains. We have added a lot of
capacity, as much as we could, on the shipping side.
We have invested in a lot more containers. We have opened 85 warehouses. And overall, our book of business with long-term customers that signed
contracts with us has grown a lot so. So, actually our cost -- we are experiencing actually that our customers feel we are doing a good job for
them under difficult circumstances.
KOSIK: That higher revenue is tied to higher shipping costs that others have to pay though.
SKOU: Yes, sure. Freight rates have gone up, which explains a lot of our growth. But we're actually also growing particularly our landside logistics
business a lot which is also adding. But we have, if you will, a perfect storm on shipping in the sense that demand has spiked in 2021, you know,
compared to 2020.
Global demand was up 8 percent. And particularly in the U.S., it was up a lot more than that. At the same time, capacity has been constrained by the
bottlenecks that we have seen. And we still see it today.
So right now, we have close to 90 ships lying, waiting outside Los Angeles and Long Beach to get dispatched. They wait for three to four weeks because
we can't get enough labor in the port.
So the combination of a much stronger demand and lower capacities has driven up -- has driven up the freight rates.
KOSIK: Thanks very much for giving all those details about this -- still the challenges that remain. Is the supply chain -- are things improving at
all right now? And what kind of year do you think it will be for global supply chains?
SKOU: Well, actually, right now the situation does not appear to get significantly better. We still see this surge of demand. Actually, we've
had for quite a number of months now, a belief that there's unmet demand out there in the market.
So the global trade is actually constrained by the shipping capacity that's available. At the same time, we see this long queue particularly in the
U.S., particularly in Los Angeles, not really moving, only very slowly.
So our bookings are strong. We expect a first quarter very similar to the fourth quarter and also expect quite a strong second quarter this year. So
I wish I could say that things are getting better, but right now there's nothing in our numbers to suggest so.
KOSIK: OK. So with things not getting better any faster, is there anything you want businesses to know that they could maybe do to get things to move
SKOU: I think we all need to get more labor. That's the thing that could really move the needle more labor in the ports. Today in Los Angeles, we
operate the largest container company in Los Angeles. And we're not able to get sufficient labor to operate all the cranes that we have.
So it means that it takes longer to offload the ships and reload them again. And that's really whatmeans that we get the queue.
But it's not only at the terminals. It's also in trucking. It's in warehouse and so on where we need labor to get back. And hopefully, with
COVID-19 restrictions lifting and fewer and fewer people getting seriously ill, that this will also happen in the next few quarters.
KOSIK: And you mention trucking as one of the issues here in the whole supply chain mess. You're buying a company, Pilot Freight Services. That's
a trucking firm. Talk us through what is your thinking behind this deal.
SKOU: We want to -- to our U.S. customers to be able offer an end-to-end logistic solution. All the way from their manufacturing plants in Asia and
to either the consumer or the brick-and-mortar store.
And we have been buying companies that help us put together that very proposition, a telephone company called Performance Team, Visible
logistics, and now Pilot Freight Services. All of those acquisitions enable us to both serve our customers when it comes to delivering product to
But also serving our customers when they want to fulfill orders that they have received online. And we need to -- deliver goods to the end consumer.
KOSIK: Now a lot of people are dealing with higher oil prices, higher gas prices, I'm curious how higher oil prices have weighed on your most recent
quarter. How much higher is Maersk's fuel bill?
SKOU: Well, it's up a lot. And for us, that's -- it's a big deal. We spent in the neighborhood of $5 billion last year on fuel. And when it goes up,
30, 40, 50 percent, it matters -- it matters for us to you know, very quickly.
So fuel is one inflationary element we have to deal with, but there are also others. That, you know, labor cost is going up, port cost is going up,
the ships that we lease, prices for those have gone up a lot.
So we are managing through a period of high inflation.
KOSIK: OK. Soren Skou, CEO of Maersk, thanks so much for your time today.
SKOU: Thank you.
KOSIK: Stay with "FIRST MOVE." The market open is next.
KOSIK: Welcome back to "FIRST MOVE." I'm Alison Kosik.
U.S. stocks are up and running this Wednesday. And as expected, we have a higher open here across the board with tech currently in the lead. A pause
in the rise of global bond yields, that's helping to boost the market move that we're seeing today, but all that could change tomorrow if U.S.
consumer inflation numbers come in hotter than expected.
Stocks in the news today include Peloton. The exercise bike firm was one of the big winners in Tuesday's session, up more than 25 percent on news of
its corporate shakeup. Speculation, too, that the company might put its up for sale, that helped it as well. Peloton pulling back a little bit an
early trading today. As you can see, down a little down over 3 percent.
And shares are down more than 70 percent over the past 12 months for Peloton as sales of its equipment slow.
Shares of chipmaker GlobalFoundries jumping after its fourth quarter results beat expectations. The company posting net profit of $43 million
versus a loss of more than $500 million a year ago.
Joining me now is the CEO of the company, Tom Caulfield.
Great to see you and thanks for being with us.
TOM CAULFIELD, CEO, GLOBALFOUNDRIES: Good morning, Alison. Thanks for having us.
KOSIK: So, looking at your earnings, revenue for your fourth quarter topping Wall Street estimates, revenue up for all of 2021. That's as the
global shortage of semiconductors continues.
CAULFIELD: We're really proud of our results. Continuous improvement through the year. I have to tell you our 15,000 employees worldwide through
almost two years of the pandemic have not missed a beat. They have just been amazing and awesome for us.
KOSIK: Can you speak to exactly what's causing the chip shortage? You know, lots of consumers want to know. I mean this is happening across a broad
spectrum of industries, you know, from computers to automobiles. People want to know when the recovery and the chip supply will begin, and you know
what does the rest of the year look like?
CAULFIELD: So let me start with, I think, my view of how we got here. For the longest time, we were a world that was in an industry that was timed to
P.C. or computer centric, part of the value chain. So semiconductors were predominantly putting in the compute part of deployment. But since about
the last decade or so, we've seen the pervasive deployment in almost -- of semiconductors in almost everything imaginable.
You know, coffee makers being connected to the Internet, thermostats, and what's happened is there's been an underinvestment in these feature-rich
chips that combine all of these different functions of computational capability, embedded memory for security, R.F. for connectivity. And
there's been an underinvestment.
And I think what really happened here was, you know, the COVID-19 pandemic really accelerated this mismatch in supply and demand. It was something
that was going happen later in time, maybe not as dramatic. So that's how we got here.
How are we going to get out of it? You know, it's not like there's a zero or one here. There's a mismatch. You know, not enough supply to demand and
all of a sudden it's fixed. There's levels of that.
And I think in 2022 we'll see that gap close, but nowhere near where we need it to close. And there's a lot of investment going on in the industry
to try to catch up, but not only catch up to today's gap, but to also catch up to the growing demand that will happen over time.
And you know, GF's doing our part. We're investing $6.5 million between 2020 and 2021 to expand our capacity as well.
KOSIK: Is that why GlobalFoundries itself -- do you feel like as a company you're behind then?
CAULFIELD: Oh, we have -- I wouldn't say we're behind. I've said there's more demand and we can satisfy with our capacity and that's why we're
investing, in capacity. But we're doing it with our customers in partnership, that they know they can count on us to create the supply, and
we do it with an intent. It's not only with customers but it's with the market segments our customers are trying to serve, as you said, automotive
for example, smart mobile devices and applications like that.
KOSIK: You know one company comes to mind that was just in the headlines this week. And I know that in November, your company announced a
partnership with Ford to boost chip supplies to them. But you know, Ford announced, it had to actually stop production at its assembly plant in
Chicago as well as its plant in Mexico because of a chip shortage.
You're supplying the chips to Ford. I would assume that you're just one of the companies supplying chips. Do you know what happened there?
CAULFIELD: Well, so one, we're one of the many. I would tell you our contribution to the auto industry was two and a half to three times more of
our manufacturing output year on year from 2020 to 2021 and it's going to grow again in 2022.
I would say early on in 2021 we were one of the gaining components and we responded to that. I think we got out of harm's way. And I think what
you're seeing again back to this pervasive deployment of semiconductors.
But the automotive unit growth is not going to be very high, right, the number of automobiles. But the content of the semiconductors to create all
these features, autonomous driving, generations of radar, the content of semiconductors in cars is growing and the auto industry is taking action to
become much more aware of the semiconductors and that supply chain and being actively involved in making sure they secure their supply for the
KOSIK: Tom Caulfield, CEO of GlobalFoundries. Thanks so much for you know taking these steps and walking us through exactly what's happening in your
industry. I really appreciate your time.
CAULFIELD: My pleasure, Alison. Thank you.
KOSIK: Good to see you.
More now on the trucker protests in Canada. The demonstrations over COVID restrictions are starting to disrupt supply chains in the U.S.
CNN's Gabe Cohen has more.
GABE COHEN, CNN CORRESPONDENT (voice-over): The busiest international crossing in North America, the Ambassador Bridge between Ontario and
Detroit, brought to a halt by anti-vaccine truckers and protesters. A Canadian spectacle that could soon hit American wallets.
The so-called Freedom Convoy has been disrupting Canadian roads and cities for weeks, demanding an end to federal vaccine mandates, including new
rules at the U.S. border for truckers heading both directions.
UNKNOWN: We're asking for our freedom.
COHEN: Now plans are underway for a U.S. trucker convoy in the coming weeks.
UNKNOWN: We need help. Some of us haven't slept.
COHEN: This trucking turmoil could accelerate the shortages and brutal inflation Americans are already facing. Between the protests and mandates,
fewer truckers are making trips across the Canadian border, creating new delivery delays and more surge in costs.
MARYSCOTT GREENWOOD, CEO, CANADIAN AMERICAN BUSINESS COUNCIL: Whether it's groceries, whether it's school supplies, whether it's clothing for their
kids, everyday Americans will be hit by this right away.
COHEN: It's just another strain on the trucking industry, which is driving much of this inflation. Trucking prices are up 44 percent since 2020, with
demand for deliveries surging over the past year amid a long-standing trucker shortage.
ANNE REINKE, PRESIDENT AND CEO, TRANSPORTATION INTERMEDIARIES ASSOCIATION: It takes about 4 to 10 days simply to find a driver. That's one of the
direct impacts of taking what we think is about 12,000 to 14,000 drivers out of the mix.
COHEN: Americans could soon see more price hikes on a range of Canadian products from lumber and auto parts to meat and grains.
Just take produce. The Star Group in Canada has plenty of it. But without enough truckers, they're waiting days to ship food. And in some cases,
dumping supply because it went bad before pickup.
UNKNOWN: There are going to be shortages.
COHEN: And since the protests started, Canadian company Catania Worldwide is paying 20 percent more to ship their produce to the U.S.
UNKNOWN: And it's a cost that has to be passed on.
COHEN: U.S. produce prices have already spiked 12 percent in the past year. And that may rise, along with many other products.
SpartanNash, a U.S. grocery company, is now funding their own trucker certification and positioning products in warehouses nationwide, in case
delivery issues intensify, which would come at a cost to customers.
UNKNOWN: We are certainly preparing for the possibility of more disruptions.
COHEN: In December, the Biden administration launched a Trucking Action Plan to streamline the trucker licensing process and ramp up recruitment.
But some companies want urgent relief.
UNKNOWN: It's tough. I mean --
COHEN: Ken Clark's (ph) company moves construction equipment. They're now seeing three- to four-week delays from Canada.
UNKNOWN: And we've seen some prices go up as high as, you know, double, triple.
COHEN: His equipment goes to a range of companies, from power plants to flour mills, all of which could pass along those price hikes.
UNKNOWN: Those costs are going to get pushed into their product eventually.
KOSIK: Coming up next on "FIRST MOVE."
Pandora is known for charms and bracelets, but now it has its eyes on climate change. I chat with the CEO about plans to make a brighter impact.
That's after the break. Stay with us.
KOSIK: Shine, shimmer, and sustainability. Pandora is known for their signature charm bracelet. Now the world's biggest jewelry brand is setting
ambitious climate targets and it's launched a brand -- a brand new collection using lab-created diamonds.
Pandora's CEO, Alexander Lacik, joins me now.
Great to have you with us today.
ALEXANDER LACIK, CEO, PANDORA: Thank you.
KOSIK: It looks like investors like your earnings, plus a proposed share buyback?
LACIK: Well, I mean last year we had a lot of good things to talk about. We had a record-breaking year. We had a record-breaking quarter four, which is
-- of course is the big trading moment for us.
And on top of that, I think beyond what we do, it's quite pleasing also to how we do it, and our sustainability story is obviously one part of that.
KOSIK: And we're going to get to that in just a moment. I want to talk about diamonds though because this is something that's relatively new
because in May you said Pandora will no longer use mined diamonds for any new designs and that you have switched to man-made stones that are produced
in laboratories with the launch of Pandora Brilliance. First of all, how is Pandora Brilliance going?
LACIK: So we launched brilliance only in U.K. We sold it as a test. The average price for a Pandora product is maybe $40. The kind of entry price
for a lab-created diamond is probably 10 times that. And we've designed this to be attractive to our existing Pandora customers, but one thing is
what you do in your concept testing and the other is what happens in reality.
So there was a real kind of test to see what our customers would be interested in, what we had to propose. You know, we can now safely look
back and say they liked what they saw, and on that basis, we've decided that we're going to go global with this initiative.
KOSIK: And so, when will you reach the U.S.?
LACIK: Oh, I get this question a lot on when. What we learned also last year was once we were in market, we got fierce competition, as you can
expect. So therefore, I decline to let our competition know when and where we're going to come.
KOSIK: OK. Understood. You know there are many consumers who have a hard time getting past the perception, the thinking that a diamond created in a
lab is not real. Are you encountering that from any of your customers?
LACIK: Well, surprisingly, we armed our salespeople with lots and lots of argument because at the end of the day, a diamond is a diamond. It's just
that the pathway is different. One has been created with a modern technology another one has kind of been created by Mother Earth for
millions of years. The end result is the same thing.
But what actually happened in the stores that the customers that were interested in this proposition. This was not the key topic. The key topic
is the design and the price actually, very much like when we sell other jewelry. That story was not as pertinent as we maybe had anticipated.
KOSIK: OK. I want to talk about your climate change commitments. Pandora committed to being carbon neutral in your operations in total by 2025. This
includes labs, offices, retail stores, warehouses. Talk us through why this is so important to you.
LACIK: So I think -- I mean you just have to look around. I keep saying this, you know. If I have the opportunity to leave the world in a little
bit better place than when I got here, then I'm kind of participating in that.
So I think that's important. We're being the largest jewelry company out there in volume terms. We have a big role to play and show the way in the
industry and that's what we're doing.
So it's not just the right thing do. That's an important motivator personally, but it's also future proofing our business. I do think at one-
point consumers will take note whether you're a socially responsible company.
We can already see of course NGOs are pushing this agenda. But I can also see that the financial community is now starting to raise the bar and
require companies that they invest to have a proper attempt to do some work in the sustainability area.
KOSIK: Have you encountered any supply chain issues affecting production or getting raw materials?
LACIK: During last year -- I mean our biggest raw material input is silver and there's plenty of silver to go around. We also then only really buy
recycled silver and gold into our own production, and there's no shortage of that. So no, there has not been a big issue. Then there are some
materials here and there, but vastly speaking, no, we're kind of OK.
KOSIK: OK. I'd be remiss if I didn't ask you about Valentine's Day. I would imagine that's a huge holiday for Pandora.
LACIK: I mean we have a couple of moments in the year. Valentine's, Mother's Day, Christmas trading, Black Friday. Those are the kind of big
key trading moments. You know, we have our knives sharp. We had a very good Valentine's Day last year. So we took a lot of learning with a lot of
exciting new products we put into stores this year, so we're very hopeful that this is going to be a good period for us again.
KOSIK: OK. Alexander Lacik, CEO of Pandora. Great talking with you today.
LACIK: Thank you.
KOSIK: Coming up on "FIRST MOVE."
China has not been a country that's big on winter sports, but now the Olympic host is trying to grow a mega snow sports industry. That's next.
KOSIK: Welcome back to "FIRST MOVE." China is hoping winter sports fans will stick around after the Olympics are over. The government has poured
billions of dollars into building up sports tourism and even though the snow at the winter games is only made by machines, tourists seem to be
taking to it naturally.
David Culver has the story.
DAVID CULVER, CNN CORRESPONDENT (voice-over): Beijing playing host to its second Olympics, but these are the first Winter Games held in China's
capital city. Given that many parts of China rarely see below freezing temperatures, winter sports are traditionally not as popular. But that is
Eric Zhang and his toddler twins just got back from a ski trip in Northeastern China. Growing up in Southern China, Eric never even saw snow
until he moved to the U.S. for college. It was there he started skiing. And now as a dad, he's made it a family hobby.
ERIC ZHANG, SKI ENTHUSIAST: I heard so many friends around me and then they're asking to -- starting to learn skiing. They're starting to learn
CULVER (on camera): Even as adults, they've --
ZHANG: Even as adults, right. And then, so we are bringing our kids to onto the snow, I think the industry is going to be booming.
CULVER (voice-over): Booming in typical China fashion, take Zhang's city, Shanghai, the lack of snow and ice not a problem. Artificial skating rinks
like this one are built annually with the help of snowmaking machines, giving kids in today's southern China a luxury generation before them never
experienced, getting a feel for the slopes on these ski simulators.
In the past five or so years, more than 100 of these climate-controlled machines have sprung up in Shanghai alone.
CULVER (on camera): As people across China warm up to the idea of winter sports, you've got more and more indoor ski facilities like this one here
in Shanghai that are opening up and with that you have a rapidly expanding market for it.
CULVER (voice-over): As part of its Olympic campaign, the Chinese government unveiled an ambitious winter sports development plan in 2016,
aiming to construct 650 skating rinks and 800 ski resorts by the end of this year and to grow the scale of the industry to top $150 billion by
2025, a lucrative market that attracts both domestic and international businesses.
CULVER (voice-over): China is proud of the surging craze. Since Beijing won its bid for the Winter Olympics seven years ago, the government says it has
successfully motivated more than 300 million Chinese to participate in winter sports, a target set by Chinese President Xi Jinping in 2014.
We should take the opportunity to popularize ice and snow sports, Xi stresses.
But China's speedy growth also brings problems. The quality and service of its ski resorts are still relatively behind more traditional ski resorts in
There are also environmental concerns. The massive artificial snowmaking in ski resorts stretches already exhausted water resources.
Back in his Shanghai apartment, ski enthusiast Eric Zhang hopeful for what's ahead.
ZHANG: I think Winter Olympics is going to be a strong booster for this; you are going to see the huge boosting of enthusiasm and passion of the
Chinese people in this winter sport.
CULVER (voice-over): An Olympic ambition for once rural nation primed to make winter sports mainstream to last long after the closing ceremonies.
David Culver, CNN, Beijing.
KOSIK: And finally, on "FIRST MOVE."
A major setback for Elon Musk's SpaceX.
(BEGIN VIDEO CLIP)
UNKNOWN: Three, two, one, liftoff Starlink 4-7.
KOSIK (voice-over): It all looked good when Falcon 9 rocket launched nearly 50 startling satellites into orbit last week but a geo magnetic storm just
the day later effectively destroyed most of them. SpaceX promises there's no danger to other satellites or anyone else on Earth.
(END VIDEO CLIP)
KOSIK (on camera): That's it for the show. I'm Alison Kosik. Feel free to reach out to me on Instagram and Twitter, @alisonkosik.
Thanks for joining us. "Connect the World" with Becky Anderson is next. I will see you soon.