Return to Transcripts main page
First Move with Julia Chatterley
U.S. CEO Survey: Only 34 percent Expect Recession to be Short; Ukrainian Troops Reclaim Several Positions in South and East; U.S. Futures Higher after Monday's Rally; Ukrainian Officials Pour Scorn on Elon Musk Peace Plan; Test Flight of World's First All-Electric Passenger Plane; Berluti CEO on the Future of Luxury. Aired 9-10a ET
Aired October 04, 2022 - 09:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
ELENI GIOKOS, CNN HOST, FIRST MOVE: Live in Dubai I'm Eleni Giokos; I'm in for Julia Chatterley. Welcome to "First Move". On the show today North
Korea firing a ballistic missile over Japan for the first time in five years it's the North's 5th missile launch in just 10 days our live report
from the region in just a moment.
And Ukraine pressing forward, with gains forcing Russian troops to retreat from several positions but Ukrainian officials furious with Elon Musk and
pouring scorn on his proposal to trade land for peace now on Wall Street, U.S. stock futures, as you can see are trading higher.
And that's often men's Monday's rally as you can see DOW up over 1 percent. And doing really well in terms of what we've been seeing over the past
month. The European markets all in the green as well weak U.S. manufacturing data raising hopes that the Federal Reserve could temper its
hawkish stance. Meanwhile, oil prices rising with OPEC Plus expected to agree on a major production cuts at tomorrow's meeting now a lot to cover
today so let's get right to our top story.
All right, so U.S. futures are holding steady despite growing worries about the economy. American CEOs are feeling less confidence that the Federal
Reserve can achieve a so called soft landing and avoid tipping the U.S. into recession. A new survey of buses of large U.S. companies showing 9 out
of 10 are predicting a recession in the next year.
Marc Stewart joining me now with more details Marc, good to see you! OK, we're going to come to the survey in just a moment. But we're seeing
markets doing quite well today. Building on yesterday's gains, we see numbers in the green in Asia, Europe as well futures looking quite strong.
Why is this because we've had some bad data?
MARC STEWART, CNN CORRESPONDENT: Indeed, Eleni yet, it's great to see you as well. We have been watching the numbers all morning. And indeed we are
poised for perhaps another rally, at least at this point, based off the numbers we've been seeing. There are a few things at play over the last 24
First of all, there has been discussion among economists at Deutsche Bank. And I heard from a Portfolio Manager just yesterday about the weaker than
expected manufacturing numbers here in the United States. Now we usually frown upon bad data, if you will, but in this case, it actually may be
giving the markets a boost.
Because if the economy is not as hot as expected, it may be a way to say to Fed Chair Jerome Powell, the hawkish interest rate hikes that we have seen
lately may not be necessary, perhaps this aggressive stance may be tempered. So that may be one reason why traders are excited.
In addition, in the headlines a lot we've heard about Credit Suisse, well, we saw their stock actually take a little bit of a jump upward yesterday,
perhaps the market and investors as a whole aren't so concerned about the future of the bank and its risk issues as they were in the past. So that's
what's at play right now. The markets open in just about 30 minutes here in New York. And we'll certainly be keeping watch, Eleni.
GIOKOS: Yes, I mean, lots to get through it. Look, the question is just how much has been priced in. And you know when we see the CEO survey saying
that they aren't so positive, they're expecting a recession. It's almost like cognitive dissonance with what we're seeing in the markets over the
last few days. But it's really reflective of the losses we've experienced over the last few months.
STEWART: Right, in the Dow, at least yesterday was below the 30,000 mark. But this idea of a recession is not really all that farfetched. I mean,
there have been whispers about that among the C-suite for four weeks. And then there have been some public statements and thinking about the CEO of
FedEx, expressing concern about a global recession, we heard from the Head of Chevron Express, expressing concern about fuel prices in the months
But this is a survey of 400 business leaders from big businesses conducted by KPMG, of course, that big consulting firm so if we break down the
numbers, about 91 percent are predicting a recession in the next 12 months. 34 percent though only feel it will be mild and short.
Yet another takeaway from the survey is that there is concern that there will be cost cutting and one area where that often takes place is among
labor. Will jobs be cut will they not be filled? That's a question that corporate America and really the world are going to have to answer in the
GIOKOS: Aptly put Marc Stewart, thank you very much for joining us great to see you! And moving on now, financial markets, politicians and millions of
Britons are waiting to see the British Government's revised fiscal plan after a major policy U-turn on Monday at the Conservative Party's annual
Prime Minister Liz Truss and her Finance Minister abandoning their proposal to cut taxes for Britain's highest earners while much of the country is
struggling with a cost of living crisis we have Bianca Nobilo. Joining us now, to break this down for us Bianca, good to see you! I mean, we saw
clearly what the markets thought of this piece of policy. The question is internally did it cause fissures? What have you been hearing at the
Conservative Party Conference?
BIANCA NOBILO, CNN CORRESPONDENT: I don't have swear words, to be honest, in any of the divisions are very deep. There is a huge amount of MPs here
I've been through about seven of these conferences, and plenty of them are deciding not to attempt not to show their support for the Prime Minister
not to associate themselves any more than they are naturally associated with this package with this U-turn and political disaster but those that I
do speak to a quite angry.
Yes, of course, the Prime Minister still has a small subset of supporters. But even they haven't been happy with how this has been handled, how the
markets weren't informed well enough about the plans ahead of time. That's why her speech tomorrow on Wednesday is going to be key. But I'm not sure
how much damage she can undo.
She isn't famous for her communication skills. These constant speeches tend to be in very broad brushstrokes we can expect to hear about growing and
strengthening the economy, about creating more aspirations for British people and championing values of democracy. I'm not sure she's going to be
able to fix the political mess that she's currently in, Eleni.
GIOKOS: Yes Bianca, really interesting, you've been hearing, you know, many epithets to describe the current situation. The question is, you know, are
we going to see her receiving the support? Because visible, fractured party is also not good in terms of its space so it would have long term
repercussions, they would have to show unity of some form.
NOBILO That is absolutely right. And that's why a lot of the delegates here who are not elected, but a party faithful, are deeply concerned because
they know that these fractures and these divisions translate very badly to the electorate, and most parties do want to stay in power. Although I'll be
honest, I've heard from some people privately in the Conservative Party that think they're in such disarray that they need to spell in opposition
to regroup. It's just a very difficult one, can the Prime Minister gain more support?
Yes, in theory, but what we're noticing at the moment, today, Eleni and I see this trend building, even in the past 48 hours, is a destabilizing
effect within the party, because the Prime Minister and the Chancellor having U- turned MPs and Cabinet members essentially smell blood.
So now they're out to reshape the Prime Minister's policies that they don't like, whether it's on the environment, on keeping benefits in line with
inflation, or a variety of others, they now see that she's weak that she knows she's bleeding support, she recognizes she won't be able to get a lot
of these bills through Parliament. So it's their opportunity to try and exert their political power. Now, that is a hugely perilous position for
any leader to be in. And let's not forget, she doesn't have a mandate from the country either. So that's why there is concern that she won't be able
to rebuild the political faith, the confidence to function as anything other than the lame duck Prime Minister was very buffeted by the different
drives and objectives of her party.
GIOKOS: You know, and a dramatic flip flop I think, for anyone in power. Thank you very much. Bianca Nobilo for breaking that down for us! All
right, moving on, and the Japanese Government say North Korea is threatening the peace and security of the region after Pyongyang fired a
ballistic missile that flew over Japan earlier Tuesday.
Tokyo warned people to take cover, and train services were suspended before the missile crashed into the Pacific Ocean. Will Ripley, joins me now from
Taipei. Will, good to see you. The last time we saw an incident like this was in 2017. But everyone's saying this is a dramatic escalation, a
dangerous escalation. Could you break that down for us?
WILL RIPLEY, CNN SENIOR INTERNATIONAL CORRESPONDENT: So the analysts have been speaking with Eleni, say that we are not at the level of tension that
we saw five years ago just yet. When President Trump and Kim Jong-un we're essentially threatening each other with war. Largely the reason that we're
not at that level just yet is because the Biden administration's tone has been relatively muted throughout all of this.
RIPLEY: So there hasn't been any sort of provocative rhetoric from the U.S. side, at least, although they certainly are watching each of these, you
know, it's unprecedented binge of missile testing very closely. And they're looking at what kind of missile was launched and what the North Koreans are
hoping to gain from this.
The experts I've been speaking with say this is likely not as much for political reasons or to make a statement as it is to gain scientific
knowledge. And but frankly, it also is a sign that Kim Jong-Un at this stage has no interest in diplomacy, and therefore he's not afraid to launch
these missiles to test them in ways that he hasn't done before.
This is believed to be a false on 12 intermediate range ballistic missile, North Korea has tested it a number of times. But usually when they do it,
it's a much shorter flight trajectory where it goes much higher up and then it goes back down. But this test, you know, the distance that it traveled
over Japan for the first time in five years, and all the way out into the Pacific.
This might be the longest North Korea has ever flown a missile of any kind, even though they've tested missiles that have a potential range that is
even greater than the one that we saw them launch in the early morning hours today.
So what does this tell us about Kim Jong-Un's intentions down the road? Experts say he's going down his list, a list that likely includes a nuclear
test the first nuclear test since 2017. A list that could include submarine launched ballistic missiles.
And that's why you see on the U.S. and South Korea, Japanese side, more military drills more show of force to try to remind North Korea or deter
North Korea from doing something that could potentially cause a miscalculation and some sort of accident or some sort of unexpected, you
know, tragedy, because frankly, when these missile launches happen without warning, things can go wrong. They haven't yet but that might be more
because of luck then because of scientific, you know, progress, if you will.
GIOKOS: Yes, exactly. It's the notion of possible accidents that is worrying. Will Ripley always good to see you. Thank you so very much. Now
Ukraine is making more gains on the battlefield, forcing Russian soldiers to retreat from several positions in the East and South of the country.
Its Armed Forces released this video on Monday saying it shows a soldier raising a Ukrainian flag in a recaptured village in the Kherson region. But
amid all the military setbacks for Russia, the upper house of parliament in Moscow rubber stamp Vladimir Putin's proclamation, annexing four regions of
Nick Paton Walsh is included for us. Nick, here's the reality these four regions are not fully Russian controlled. So the question is how does this
change the game for the Ukrainians and importantly the front lines?
NICK PATON WALSH, CNN INTERNATIONAL SECURITY EDITOR: But it doesn't tall. And in fact, it just each step that Russia takes to furtherly formalize
what its claim and assimilation of Ukrainian territory as part of Russia just looks sadly more out of touch with reality and what they're seeing on
It's an odd position for Moscow to have chosen to put themselves in in pretty much every territory that they now claim as theirs. They are
experiencing losses, losing territory as I speak today, on the East side of Lyman, that's in Donetsk. It appears that Ukrainian forces are pushing
further into the hands. That's another area, which Russia says is now all Russian territory in the same time too down towards Zaporizhzhia.
There are some suggestions of Russian Progress, Ukrainian progress. But certainly the most startling news today is on the south in Kherson area
where there are multiple reports of Ukrainian forces pushing forwards and taking villages off the Russians at times quite a fast speed.
Now the Ukrainian Military are keeping relatively close to their chest exactly what progress they've made. But there does appear to be quite a lot
of movement from the sources that we're speaking to. And that brings to the possibility that yet another front for Russia. The third is potentially
collapsing in as little as a month.
Now we've seen what happened around Kharkiv, the second largest city in Ukraine, about a month ago, we've now seen after persistent pressure from
the north, and from the west towards Lyman, the impact that's having on Russia's presence in the East of Ukraine.
And then now in the south, they've long been talked how possibly Russia was going to exceed a Ukrainian counter offensive on the Southern area. But
that appeared to have been something of a distraction to allow the Kharkiv operation to take place.
But still now, Ukraine appears to be actually prosecuting that push in the south and it is apparently quite effective now. So regardless of the
choreography, the rubber stamping of this, it seems almost farcical notion that Russia suddenly assimilated parts of Ukraine. Ukraine continues to
push forward at the same time too. Ukrainian President Volodymyr Zelenskyy putting a decree out today saying that negotiation with Russia is
WALSH: He has simply said he won't talk to Vladimir Putin. His decree says they won't really see any need to talk to Russia at this point. And for
their part, the Kremlin is saying they can't talk to Ukraine until Zelenskyy leaves office. So it's the battlefield where this is going to
continue to be decided. And this Ukraine on the front foot now.
GIOKOS: Very quickly, in terms of the partial mobilization, of course, we've seen images of a lot of setbacks for the Russians. But of course,
that is still in process.
WALSH: Yes, but it hasn't changed the battlefield at all. And in fact, we'll be seeing more of is signs of how badly that is being handled the
enormous dissent that it's stirred up amongst ordinary Russians, including, you know, prominent state, TV personalities have come out and been very
critical of how it's been handled.
The only plus for the Kremlin of that would have been flooding their frontlines with probably poorly equipped, but certainly more recruits for
the front line. But we haven't seen that happen in any meaningful way.
And instead, we've seen the troops that are they're being pushed back and at times stories of how they have faced supply and command issues. So,
frankly, an appalling picture across Russia's frontline entirely, with this continued odd backdrop of them, saying they've assimilated large chunks of
Ukrainian territory as Russia but also worryingly, the backdrop of nuclear force intermittent but still there, Eleni.
GIOKOS: Alright, Nick Paton Walsh, thank you so much. Right now we're waiting to hear whether OPEC+ will cut oil output to reverse weakness in
the price of crude. There's talk that production could be reduced by more than a million barrels a day falling prices and market volatility are a
major topic at a big energy conference in London right now.
Anna Stewart joining me from the energy intelligence forum Anna, always good to see you! I think, you know, a few months ago, we're talking about
needing more oil being pumped into the markets to try and stabilize prices. And now we're talking about potential oil cuts. Give me a sense of the hot
topics that are going to be discussed and why these are going to be vital in terms of understanding the true supply demand dynamics.
ANNA STEWART, CNN REPORTER: Well, that is certainly one of the big topics today. And actually, in the introductory marks, the energy intelligence
Presidents that they're hearing, OPEC will cut output by 1 to 1.5 million barrels per day, perhaps even more.
And that's really significant, over 1 percent of the oil that's consumed around the world every single day, it's much more significant than the cut,
we saw last month of 100,000 barrels a day, which perhaps was really just a signal to the market that this was going to come this was going to be
expected. It will not bring much joy if it happens tomorrow to many corners of not least the U.S. administration who complained so much in terms of
trying to get OPEC to pump more not less to keep prices down to try and tackle inflation.
But I think at this stage OPEC wants to regain control of the market and so much has been out of its control the war in Ukraine sanctions on Russia,
and of course, the growing fear of a recession.
And Eleni, just looking at the next few months in terms of the short term, there are lots of other elements that could surprise this market, or at
least could upset oil prices, if you look at the G7's plan to put in place a cap on Russian oil prices or at the same time that the U.S. plans to ban
Russian oil from seaborne imports.
There's some skepticism though, as to how effective some of these measures would be. I want to show you one of the comments from the CEO of Shell
earlier today. And one of the conversations he said he struggles with understanding how effective an oil price cap on Russian oil would be. He
says intervening in complex energy markets is going to be very difficult. Governments need to consult with market experts on what they can and cannot
in terms of interventions.
And actually one of the other big topics here really is the transition ahead for renewable energy and clean energy. And in some senses, in many
ways in the last couple of years was such a tight oil and gases market, we've been taking a few steps backwards, not forwards. It's very
interesting recent comments from the IEA on coal last year was an all-time record in terms of coal fired power and accounted for over a third of total
So the conversation here very much from all the big businesses, whether it's fossil fuel companies, or disruptive new energy companies, how to
invest in that future, and what policymakers need to do to really realize some of those investments, Eleni.
GIOKOS: Really interesting Anna Stewart, thank you so very much. I'm sure we'll be catching up with you on the biggest lines coming out of this
conference in the next couple of days. Right and coming up on "First Move", finding the positive amid a whole lot of negative some hopeful signs in a
bear market. That's racing to develop electric flight a successful debut for the world's first all-electric passenger plane all coming up. Stay with
GIOKOS: Welcome back to "First Move", I'm Eleni Giokos. Now U.S. futures pointing to further gains at today's open after all three major indices
surged on Monday to start the fourth quarter as you can see DOW up 1.2 percent NASDAQ looking strong as well and that's after three consecutive
quarters of losses for Wall Street, of course, but my next guest says there are plenty of reasons to say positive despite what looks like a tough
Joining me now is Kristina Hooper, Chief Global Market Strategist at Invesco. Kristina, great to have you with us! I love speaking to, you know,
eternal optimist and I wonder what it is what are all the bright spots that you're picking up within the market, because we saw that CEO survey,
they're still expecting a recession, we've had markets coming under pressure, but perhaps this is an opportunity to come in and buy.
KRISTINA HOOPER, CHIEF GLOBAL MARKET STRATEGIST, INVESCO: Well, definitely mean, what we usually see with market behavior is that when sentiment
becomes so negative, it creates oversold conditions. One key contrarian indicator has historically been the American Association of individual
investors, they do a survey every week, and when you see very, very bearish sentiment, and that's what we've seen the last couple of weeks is over 60
percent readings, that tends to be a signal that we're likely to see in the next six months above average returns. That's just what history has shown.
So you know there's an old adage that tends to be true. when others are fearful when the crowd is fearful, be greedy, and when everyone's greedy,
GIOKOS: OK, so I was just looking at the numbers in terms of the S&P 500. I think it's down year today it's around 25 percent. And then what one also
wonders if we're still expecting a recession, we've got to think about what has been priced in, and then also importantly, what earnings are going to
show us during a recessionary period.
Do you think that we still have some downside left before it is the right time to buy now? You can't really price the market. But I think how has the
bad news really worked through the earnings scenarios?
HOOPER: I don't think we have fully seen priced an earnings downturn. I mean, let's face it, so much of the market movement this year has really
been a direct reaction to where the tenure yield has gone. When yields go up, stocks go down. We've seen that pattern this year.
HOOPER: So do I think that a big downward revision in earnings has been and priced in? No, but it remains to be seen just how significant a downward
and revision in earnings we might see. Certainly in the United States, if the Fed were to pivot, sometime soon, we might be able to avoid a
recession. And so we don't know exactly what kind of damage we'll see to earnings a lot is in the hands of the Fed right now.
GIOKOS: So exactly, and this is quite important, right? Firstly, we've got a sticky inflationary environment. The last inflation number really spooked
the markets. Do you think that the Fed needs to stop being so aggressive in its interest rate hikes? Do you think that that's going to be quite
HOOPER: I do think so I think the fate of the U.S. economy and to a certain extent the global economy is in the hands of the Fed. And what they do
going forward will help dictate where we go and what you know how significant the slowdown is. Right now, I think that certainly inflation is
But I would expect that inflation eases significantly over the next several months. Certainly inflation expectations are very, very well controlled
right now. And so there are a lot of reasons why the Fed should be able to pivot it doesn't mean stop tightening entirely, but go easier. 75 basis
point hikes in quick succession can be very dangerous.
GIOKOS: Yes, and we know that can have quite a dramatic impact on the growth scenarios. But if inflation does remain sticky, if we do see an
issue there, you know, there are very few tools that the Federal Reserve can actually use to bring down inflation.
And many say that is a huge risk for the average American because the cost of living is going to increase. And then, you know, when we can start
talking about a stagflationary environment, they say down the line.
HOOPER: Clearly that is a risk. I think it's far less a risk in the United States. And it is, unfortunately, in Europe in the U.K., but it's certainly
a risk and that's why the Fed is doing what it's doing. But it can only control that portion of inflationary pressure driven by demand.
It can only soften demand. It's starting to do that. All you need to do is look at the U.S. manufacturing PMI that came out the other day, new orders
are in contractionary territory, so the Fed is doing its job.
GIOKOS: Alright, Kristina Hooper, great to see you, thank you very much.
GIOKOS: All right, so moving on. Elon Musk enrages Ukrainian officials, including President Zelenskyy after tweeting his thoughts on what Ukraine
should give up in exchange for peace.
GIOKOS: Welcome back to "First Move" U.S. stocks opening higher again following Monday's big rally. The DOW is now back near 30,000 point level
as you can see 1.26 percent up.
The shares of Poshmark are surging after a degree to be bought by the South Korean Internet giant Naver and EV Maker Rivian is also doing well after it
announced production met expectations in the third quarter as you can see those stocks surging today. And then this tweet from Elon Musk is drawing
criticism from Ukrainian officials, the tech billionaire suggesting ways to bring about peace amid Russia's invasion of Ukraine among his ideas,
redoing elections in Ukrainian regions recently illegally annexed by Russia and making Crimea a region the Crimean annexed in 2014 formally parts of
Clare Sebastian is in London for us. Clare, I have to say, when I saw these tweets and also the threads of these tweets, it was fascinating to see what
people think and of course, a lot of backlash in terms of Elon Musk's suggestions.
CLARE SEBASTIAN, CNN CORRESPONDENT: Yes. And then Elon Musk had garnered some popularity in Ukraine at the beginning of this war by supplying his
Starlink satellites to provide internet access there.
I think it's clear he has undone that goodwill, with this tweet, not only suggesting that Ukraine should actually accept holding referenda on the
status of its sovereign territory, but really parroting a call Kremlin line with the idea that former Soviet leader Nikita Khrushchev made a mistake by
handing Crimea to Ukraine in 1954. That is one of the core tenets of President Putin's sort of, you know, stance on Ukraine.
And he literally repeated that the reaction from the Ukrainian side has been pretty furious. President Zelenskyy tweeting out his own poll where he
asked his Twitter followers which Elon Musk do you like more one who supports Ukraine or one who supports Russia?
I should say that that poll has almost as many votes as Elon Musk's poll that we don't know the results yet. Ukraine's Ambassador to Germany using
particularly choice language in responding to this really capturing the fury of the moment we've had to blur some of that out but he called it my
very diplomatic reply to you Elon Musk, and even among the sort of anti- Kremlin Russian dissident population. Garry Kasparov, former chess master and well known Russian dissident, tweeting, this is moral idiocy repetition
of Kremlin propaganda, a betrayal of Ukrainian courage and sacrifice.
Now, Musk far from stepping back from these comments is doubling down on them. And one particularly instructive tweet for Musk to consider would be
from the Deputy Chairman of Russia's Security Council, a former President Dmitry Medvedev, who tweeted kudos to Elon Musk.
And even suggested that his next tweet should be Ukraine is an artificial state aligning him with perhaps an even more stark element of the Kremlin
line on Ukraine that it does not have a right to exist as a sovereign nation.
So I think if there's anything to be learned from this Eleni, aside from the fact that Moscow might be advised not to comment on peace negotiations
around this war, is that Ukraine is very clear that any kind of peace negotiation that involves losing any part of its territory is a red line.
GIOKOS: Yes, because a lot of people are asking, you know, firstly, you know, what kind of authority does he have asking these questions on Twitter
where anyone and everyone could vote, firstly.
And then, secondly, you know the impact that it has in terms of the narrative and the conversation around this, that it could spur more tension
or, you know, creates more issues within the conversations that are happening on social media. What have you been hearing?
SEBASTIAN: Yes, I mean, I think it's all particularly jarring coming at this point. On the days in which we see the Russian Parliament ratifying
their attempt to annex almost a fifth of Ukrainian territory when we see President Zelenskyy signing a decree which basically declares the option of
negotiating with President Putin to be impossibility.
SEBASTIAN: In the context of these annexations, I don't know that it necessarily makes things worse. But it certainly underscores, as I said,
Ukraine's position on this and the sensitivity of the issue around --the issues around these attempts to sort of annex parts of its sovereign
territory and particularly the Crimea is still a very sensitive issue to Ukraine.
So I think it just sort of underscores the divisions in this war. And really that Elon Musk, perhaps shouldn't be given too much of a platform on
GIOKOS: Yes, exactly important when people of his caliber and his strength and his, you know, status on Twitter and social media, perhaps, you know
the impact that it has and the conversation has really been fascinating.
Clare Sebastian, thank you so much, always good to see you. Now coming up after the break, electric flying taxis take a step closer to reality. This
one's called Alison has just completed its major test that is coming up next.
GIOKOS: Up, up and away and you're looking at the world's first all- electric passenger aircraft on its first test flight. The zero emission planes flew for eight minutes at an altitude of three and a half thousand
It's called Alice and the makers say it can fly for over 250 nautical miles and can recharge battery just takes around 30 minutes to do so. It will
come in three configurations a nine passenger commuter plane for regional routes, a six seater executive version with all mod cons and a cargo
version with a load capacity of nearly 1200 kilograms.
Gregory Davis is the company's President and CEO Gregory, really exciting stuff. I mean, this is a test flight was eight minutes. I want you to tell
me about Alice and how she performed and whether you're happy with what you saw.
GREGORY DAVIS, PRESIDENT Y& CEO, EVIATION: Just over one week ago in fact, it was one week ago right now we saw history happen with the first flight
of Alice, the world's first all-electric passenger aircraft. As you said the flight was eight minutes reach 3500 feet and it went exactly as we
GIOKOS: I want you to talk; I want you to talk a little bit about the future prospects yet because this was the first test flight from testing to
actually commercializing this. How many, how many more steps do you need to take?
DAVIS: Well, we're at the beginning of the next phase, as we say. After first flight, what we've done is we've started evaluating the performance
of the aircraft versus how we wanted it to play, and that we go through the next development process to bring it to market.
You know, the future of Eviation is all around sustainability. It's about the three Cs; it's about carbon cost and convenience. And what we're doing
now is developing an aircraft that's going to take you and I and our families and our cargo around the world point to point in that convenient
GIOKOS: Yes. We are talking about 250 nautical miles right now, you know what you mean, in terms of timing, what that distance would be? And then
obviously, use as you're talking about regional use. Are you foreseeing more of a demand for cargo?
Do you think that this is going to spur the interest of passengers? And where do you think demand is going to come from?
DAVIS: Today, half the world's air travel is 500 nautical miles or less, and somewhere between 20 and 30 percent of global air travel is in this
under 250 nautical mile range.
And so this is how we traveled today. What we're going to be able to do with Alice is allow for us to continue to travel on the routes that we want
to fly those short range 250 nautical mile routes, without harming the environment.
You know, certainly the cargo Americans very interested, Alice, you know, won't be zero emission, but also very quiet as an aircraft that's going to
enable access to airports that weren't previously available to us.
So we're going to enable that point to point connection, you think about wanting to go for a day trip or you can see family or whatever it is that
we want to do. And we want to be able to continue to enjoy and do this without harming the environment; Alice is going to make that possible.
GIOKOS: OK, I want to talk price here. You know, what is the cost going to be, and I'm sure initially, with any new technology, it's going to be
relatively costly. And is it going to make sense for you know the DHLs and any of the other companies that are looking to shift cargo?
DAVIS: Today's aircraft, the ones that burn fuel, they burn a lot of fuel and fuel is aviation fuel is very expensive. What we're going to be able to
do is take fuel entirely out of the equation. So electricity generated from the grid is substantially cheaper on an energy basis versus, versus, you
know, even the cheapest aviation fuel.
And so you're going to see a dramatic decrease in direct operating costs for electric aircraft versus traditional turbine powered the fuel burning
aircraft. From day one, it's going to drop that class, and that's going to translate into a more cost effective operating environment for people who
are flying on Alice.
GIOKOS: OK, battery technology, perhaps that's also one of the big downsides, right? These batteries are very weighty, they are heavy, I know
that it only takes about 30 minutes to recharge.
But could you take me through the innovations that are occurring within the battery space? And how do you plan to solve some of these problems?
DAVIS: Well, we are very excited about battery technology. Right now, there are multiple different technologies; everything from how the cells or
pieces that form up the battery are produced to the chemistry and physics that goes into battery development.
We actually see multiple paths to having batteries that are going to power Alice, that, again, the technology is already there. I mean, you just saw
Alice fly for the first time as a fully integrated system. And that's today; the technology is advancing so quickly, that we're going to be able
to do amazing things with the aircraft in the next few years.
GIOKOS: OK. Quick question, how much is it going to cost me to get a seat on Alice?
DAVIS: You know, what--
GIOKOS: You said it's probably not going to be too expensive. I know that you're saying jet fuel is expensive. But this is going to cost because
you've done a lot of R&D spend and technically it's new technology. So it will cost quite a bit.
DAVIS: Well, we have a very large market in front of us in terms of making the aircraft economically viable, viable, there's going to be a lot of
pickup on the plane. In terms of the cost obviously, it's going to be up to the operators to set their own pricing.
But we definitely foresee that the decrease in direct operating cost of the aircraft versus a conventional plane is going to make ticket prices very
attractive for you and me very early on.
GIOKOS: I hope so, sounds really interesting. Thank you very much, Greg, great to see you. That's Gregory Davis President and CEO of Eviation.
Alright, so still to come on "First Move" followers of fashion are getting a backstage.
GIOKOS: Look at some of the world's most iconic brands LVMH Communications director discusses its unique event after the break.
GIOKOS: LVMH is once again raising the curtain on some of its most iconic houses offering the public a unique peek behind the scenes at brands from
Dior to Louis Vuitton to - and even benefit makeup. The group is hosting Les Journees later this month for the first time since 2018.
The free event takes place at 75 houses in 15 different countries, including the unprecedented opening of Tiffany and CO's workshop in New
York. Online reservations filled up in minutes.
But all this is not lost. Fans can still queue up to visit some LVMH sites, Julia Chatterley managed to catch up with Antoine Arnault, the CEO of
Berluti and LVMH Communications Director.
ANTOINE ARNAULT, CEO, BERLUTI: We have 75 missiles that are opening their doors during one three day weekend. It's something that we've been doing
for 10 years, it's now every couple of years people are just full of joy, full of are expecting it and are waiting for it to happen.
But the most exquisite part of it all is that our artisans are the people who work in our houses are even more happy and joyful to show their art.
It's very unique for them too.
GIOKOS: If I look at the scope of the brands under your umbrella, we go from sort of quiet luxury of a brand like Loro Piana to probably one of the
most recognized jewelry brands in the world, Tiffany's right through to a high street makeup benefit.
And the Sephora chain which is very familiar to perhaps to people who live in the United States. More unexpected, I think for those that look at LVMH
and actually don't know what the entire portfolio comprises. Some might be surprised.
ARNAULT: Yes, there are multiple brands, and you've mentioned only the fashion and, and cosmetic ones. But we're also very strong in wines and
spirits, in distribution and now in hotels.
Our motto and really the way we see business and in this high end business is that every house is unique. And even though they are under the LVMH
umbrella, they have their own DNA, their own way of doing business, their own values, and they're completely independent.
Most of them have very different strategies. Some of them are even competing with each other. But we often asked what the secret of LVMH is; I
would say that if one was had to be pointed out it would be the fact that they're all independent.
ARNAULT: But sharing a set of a same umbrella of values and a way of doing beautiful things.
GIOKOS: It's very important to you to preserve the history, the culture, the DNA of each of these luxury brands, whether they're hotels to your
point or in the wine and spirits business or in the luxury fashion space, that DNA matters to you.
ARNAULT: Yes, absolutely. I would say DNA and having a long horizon, what we give to companies and what we give to the teams in our companies. And
what we give to the designers in our brands is we give a long horizon so they don't have to worry about what's going to happen in the next three
months. They have to worry about what's going to happen in the next 30 years.
GIOKOS: Antoine Arnault also discussed his views on attracting younger generations, including Tiffany's entry into the NFT, or non-fungible token
space that's made them the one to watch within the luxury sector.
And of course, with some help from campaigns featuring the likes of Beyonce and Jay Z. Antoine emphasize the importance of finding a balance between
what clients want in the future and preserving each brand's unique history.
ARNAULT: We view it as something completely natural. Of course, we want to attract younger customers. Not always, but it's part of why brands continue
to be relevant. And, and I think this campaigner Tiffany is great to, to attract that new generation and to make them understand and to explain the
history and the values of Tiffany.
NFTs is another thing that you mentioned, the crypto punks that Tiffany did are great. But it's NFT's but solid NFT's that you can carry around your
neck, so it's not that digital.
However, just to explain, in a second, the way we see how to attract customers, we try to do as least marketing as we can. So of course, in
certain cases we need to, and we, you know, we buy media, so we do some sort of marketing, but the rest is at the hand of the designer.
It's him who sees and who senses trends, and we trust them. They don't have Carte Blanche, but they in our group are as close to - blush as it gets.
GIOKOS: I have to ask you about the metaverse while we're on this subject. How do you feel about the prospect of selling Louis Vuitton handbags as an
example, for someone's avatar in addition to selling the physical version? What does that mean to you? Can you see the brand doing that?
ARNAULT: Listen, you, especially in our business, and in the very fast evolving world, you should never install the future. So I cannot really
answer that in a certain manner.
What I can tell you is that we don't have the vocation to be the first ones in this field. So until the metaverse proposes us an experience that will
be at the level of what we think our brands deserve.
We won't really try to be the first ones in. If one brand out of our 75 wants to be a pioneer and wants to, you know, embrace that Metaverse
course, we will let them of course.
But I would say that for our big brands and the ones that are important to us, our advice to them and of course it's often listened to is to wait.
Probably not sell Vuitton handbags for avatars, but more.
Start thinking about how to create experiences, exhibitions, how to create something that cannot be found in a store, rather than, you know,
immediately jump on trying to sell many handbags or digital sneakers. That's not what we do.
GIOKOS: I want to talk about digitization. I want to get your view on this overall because what we saw throughout the pandemic was a forced need, I
think for people to be able to shop online to manufacture some kind of luxury experience that they couldn't have in person, but they still wanted
ARNAULT: It's growing consistently and it's grown since the pandemic began even much more than it had in the past 10 years. So it's evidently one
aspect of business that we are looking at very closely that we are strong in.
ARNAULT: However, we still believe that physical stores and those physical experiences are more important than any innovation we'll be able to find
online. That's why we continue to open magnificent temples with the latest one and not very far from here on Avenue Montaigne.
And it's really something that we will continue to do invest in architecture, invest in design, invest in something that cannot be
GIOKOS: Alright, and finally, along with almost everything else on sale these days expect to pay more for Christmas trees this season. A U.S. trade
group says costs for labor materials and shipping continue to climb.
Some expect wholesale prices to rise as much as 20 percent this year, and you can bet that will get passed on to the consumer. One bright spot I ever
was told this year at least there will not be a shortage. Well, that's it for the show. I'm Eleni Giokos in Dubai. Thanks so very much for watching.
"Connect the World" with Becky Anderson is up next.