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Quest Means Business

Officials Working On Plan To Remove Bridge Debris From Ship; Six Presumed Dead, Recovery Phase Of Operation Underway; White House: Israel Agrees To Reschedule Meeting On Rafah; Recovery Efforts Underway At Baltimore's Key Bridge; Companies Divert Shipments As Baltimore Port Remains Closed; Rent The Runway To Boost Share Price With Reverse Split; Groundbreaking Discovery In The Bahamas; Airlines Face Challenges On The Cusp Of Their Busy Season. Aired 4-5p ET

Aired March 27, 2024 - 16:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

[16:00:13]

RICHARD QUEST, CNN INTERNATIONAL HOST: The closing bell ringing on Wall Street, strong day on the Dow, strong day on the NASDAQ. Now, we just

needed a strong gavel to bring things to an end.

I'd give that a B-minus on the gavel.

Those are the markets, and the main events of the day. Officials in Baltimore are working on a plan to begin moving the wreckage of the

collapsed ship to free the container -- the collapsed bridge, I should say, to free the container ship underneath.

Disney and the governor of Florida have settled a years' long dispute.

And rent the runway, an IPO darling that's fighting Brit's listing.

Live from London on Wednesday, it is March 27th. I'm Richard Quest and I mean business.

Good evening.

We begin tonight on the US Coast where the Coast Guard says its priority is to reopen Baltimore to shipping now that no one else appears to have

survived from the deadly bridge collapse. Eight people are believed to have been on the bridge when it was struck by a container ship, two survived and

were rescued from the water. Six others are presumed to have died. We are learning more about some of them.

Maynor Sandoval, a father of two, who worked on multiple jobs. His brother says he was the main provider for his family.

(BEGIN VIDEO CLIP)

CARLOS SUAZO SANDOVAL, BROTHER OF MAYNOR SUAZO SANDOVAL (through translator): He was the breadwinner for his children right now. God is

going to provide for us, too, so we can get together as a family and see how we can help each other because at this moment, his wife is left with

his girl and everything.

(END VIDEO CLIP)

QUEST: Another of the victims is Miguel Luna who is originally from El Salvador, had three children. He had lived in Maryland for nearly 20 years.

So the investigation well and truly underway into what happened. CNN's Brian Todd with the latest.

(BEGIN VIDEOTAPE)

BRIAN TODD, CNN CORRESPONDENT (voice over): Investigators say they're going to examine a play-by-play breakdown of the moments before a fully loaded

cargo ship rammed into the Francis Scott Key Bridge killing six people. A key piece of evidence, the ship's data recorder.

JENNIFER HOMENDY, NATIONAL TRANSPORTATION SAFETY BOARD CHAIR: We've sent that back to our lab to evaluate and begin to develop a timeline of events

that led up to the strike on the bridge.

TODD (voice over): National Transportation Safety Board Chair Jennifer Homendy says, they will use that data in addition to interviews with

witnesses.

Julie Mitchell works at the port. She told CNN affiliate ITN that the cargo ship seen here with its lights flickering off moments before the crash was

in port for two days.

JULIE MITCHELL, PORT WORKER: It was just some power failures left and right, so whenever it left port, some of us feel like it should have left

when it was daylight, so they could take care and see what issues they were having, too.

TODD (voice over): CNN reached out to the ship's operator, Synergy Group for response. We haven't heard back.

Transportation Secretary Pete Buttigieg doesn't expect the investigation will change bridge or ship design moving forward.

PETE BUTTIGIEG, US DEPARTMENT OF TRANSPORTATION SECRETARY: A bridge like this one, completed in the 1970s, was simply not made to withstand a direct

impact on a critical support pier from a vessel that weighs about 200 hundred million pounds.

TODD (voice over): Despite what Buttigieg says, structural experts like Timothy Galarnyk say this was all avoidable.

TIMOTHY GALARNYK, STRUCTURAL ENGINEER: This bridge should have had pure protection. Dolphins or pure protections are cylindrical structures that

are constructed in the navigable channel upstream and downstream from the main piers. They are designed intended to be struck.

TODD (voice over): At this moment, Buttigieg says the major focus is reopening the port.

BUTTIGIEG: We are concerned about the local economic impact with some 8,000 jobs directly associated with port activities.

TODD (voice over): But Homendy says the investigation will look at what could have kept the bridge from coming down.

HOMENDY: We will look at areas that should have been in place to prevent this type of disruption from occurring.

TODD (voice over): The six workers who were killed were on the bridge filling potholes at the time, including Dorlian Castillo Cabrera from

Guatemala, who has been working in the area for three years and loved his job, and 38-year-old Maynor Sandoval from Honduras, a father of two. His

brother told CNN he loved his family.

SANDOVAL (through translator): He was loving happy guy, a happy guy, a guy with vision.

TODD (voice over): So far, no bodies have been found, but divers are still doing dangerous recovery work around the wreckage.

UNIDENTIFIED MALE: If those bodies are entrapped in the physical structure, what has to happen is pieces of metal and steel and cement have got to be

moved. A diver could be dead in a matter of seconds and he wouldn't even know it.

[16:05:08]

TODD (voice over): Buttigieg says cleanup crews are working to clear out the hundreds of millions of tons of wreckage so shipping can resume and

the bridge can be rebuilt.

BUTTIGIEG: We know that it can't happen overnight, and so we are going to have to manage the impacts in the meantime.

(END VIDEOTAPE)

QUEST: CNN's Pete Muntean is with me. He is in Baltimore.

The massive operation that has to take place even before they work out what happened. I mean, they are obviously going to get to the bottom of exactly

what happened. You've got the ship, you've got the recording, you've got the people on board. So they're not -- that's not going to be the mystery.

How do you get this thing opened -- reopened in a reasonable time, that's the hard part.

PETE MUNTEAN, CNN AVIATION CORRESPONDENT: Yes, and there is a big economic impact here, Richard. You know, this is one of the big because places where

cars are imported on the East Coast.

Right now, the focus is a collaboration between the Army Corps of Engineers and other local crews to try and get the bridge itself that collapsed onto

the MV Dali off of the bough of the ship because that caused the bough of the ship to hit the floor of water there.

And so, as soon as they can get that off, then they can get the ship re- afloat a little bit and then move the ship out of the way. That is step one.

But the big thing here that investigators and officials underscore is that this is going to take a long, long time before the mouth of the Patapsco

River here that leads into Chesapeake Bay, that leads into the Atlantic Ocean, will be fully cleared up.

QUEST: On this economic question, ships can be diverted to further ports, up and down the seaboard. But you've got 10 ships on the inside, really, I

mean, for want of a better word, are stuck for the foreseeable future. Sure, their cargoes can be removed and dispersed by road.

MUNTEAN: Sure, and you know, this is a place where a lot of super cargo ships come in and out, but those 10 ships are now -- the good news is and

maybe a bit of a silver lining is that ships coming in or would have been coming into the port of Baltimore can go to other places. They are being

diverted to places like the Port of Newark, Port of Norfolk, Virginia, and so, there are some options here, but it is not a good thing.

This is a place where a lot of cars are exported, a lot of commodities are imported, salt and sugar. This is the home of the Domino Sugar Plant here

in Baltimore.

You know, Maryland is a big economic driver for the entire United States, but also worldwide, and so, there is going to be a ripple effect here that

Transportation Secretary Pete Buttigieg and President Biden said could be felt for a long, long.

QUEST: Pete Muntean, who is in Baltimore, I am grateful for you, sir. Thank you.

The Transportation Secretary Pete was referring to, he says the parties liable for the collapse will be held accountable. Well, that's something

very easy to say and a lot more difficult to do.

For instance, just off the top of my head this morning, you've got the huge cost of replacing the bridge. You've got the damage to the Dali, you've got

the lost income for the Dali, the port, the city, the lost incomes, all the compensation there and the seven commercial or 10 ships US officials say

that are stuck in port, they will be obviously not getting the income for some time yet.

There is only one group that will make money on it, of course, it is lawyers. University of Rhode Island Professor Emeritus Dennis Nixon is an

expert in Marine Law.

I mean, all right. The ship is ensured, yes. How -- and there will be reinsurance from the insurer. How far do their liabilities go?

DENNIS NIXON, UNIVERSITY OF RHODE ISLAND PROFESSOR EMERITUS: Well, you have to start with jurisdiction because we've got to determine what port we're

in, what sort of liabilities we are facing. It is important to know that the Congress in 1948 pass the Extension of Admiralty Jurisdiction Act, so

that even though this was not a ship hitting another ship, which is a typical liability action, Congress said if a ship damages a pier, a lock,

or a bridge like this, the case should be heard in Admiralty Court.

In the United States system, under Article III, Section 2 of our Constitution, all cases of admiralty and maritime jurisdiction must be held

in the federal court system.

So my guess is the first lead legal action they will be filed will be filed in the Federal District Court in Baltimore. And I imagine it will be

filed pretty quickly.

I envisioned as you were outlining, at least four different principal areas of claimants in what is going to be a lifetime kind of a case for some

attorneys beginning now.

The four categories are obviously the --

QUEST: So, how --

NIXON: Go ahead. I'm sorry.

QUEST: No, no, forgive me. I interrupted you. Forgive me. I am interested.

[16:10:01]

NIXON: All right, so the four categories. First and foremost, the families of the deceased workers and the one worker who was seriously injured, but

has survived, that's category number one.

Category number two is depending on ownership of the bridge, I am not sure whether its federal or state or the property title actually rests, but

certainly, the two US government, the state of Maryland US government, will be going after the full cost of reconstruction.

Third, there were many containers that were crushed on the deck of the ship, and they are all going to be seeking recovery from their cargo

insurers who will be going against the ship as well. So there will be an action against their insurers who will subrogate against the ship.

And then finally, the remaining cargo owners, because those cargos, those containers are going to be on the ship for some time, it looks like that it

is going to be a very difficult salvage operation to get the bridge off of the ship and make sure that it is still in floating condition, then can

unload those containers and get them on their way.

QUEST: So, let me just jump in here.

NIXON: Okay.

QUEST: But then you have what I would describe as the consequential loss and damages, the cost of clearing the whole mess up. The loss of income and

profits from the ships that are trapped. Is it reasonable to expect one ship's insurer to bear all those costs, even if it ripples out through the

reinsurance market.

NIXON: Well, yes, it is and that's why the International Group of P&I Clubs, I am quite confident this ship is a member of one of the principal -

- like there is about 35 P&I Clubs around the world. They place the largest reinsurance contract every year in the London insurance market with Lloyds

and there is a substantial amount of insurance available to pay claims in this case.

So yes, it is reasonable to assume because risk managers have assumed that something like this might happen and they have foreseen the need for very

significant amounts of insurance.

This ship was owned by a responsible shipping owner. By all accounts, it has been -- it is a relatively new ship and well-maintained with only one

potential discrepancy discovered and fixed about a year ago.

QUEST: So, on the question of insurance. I mean, at the end, have you got - - this is a how long is a piece of string question. What would you imagine the total costs of this will be?

NIXON: Well, if we are taking some of the guesses of a new bridge costing at least $200 million, there is a start.

We certainly have the wrongful death cases against the workers, these workers who have lost their lives, and I would just say put another hundred

million there. There is going to be, I think probably significant damage to the ship if it is not totaled. There is another hundred million there.

And then when you look at the consequential damages to all the terminal operators that are out of business essentially for months until the channel

is cleared, when you look at all of the additional economic damages that the importers and exporters rake, I think were up in that five hundred to a

billion dollar category.

QUEST: Interesting. Sir, we will talk more about you -- I am sorry, we will talk more to you in the weeks ahead and certainly, we will hopefully have

you back to tell us excellent information. Thank you, sir. I'm grateful.

Now, Hamas is calling for an end to humanitarian airdrops in Gaza. I am going to explain that in a moment.

(COMMERCIAL BREAK)

[16:16:19]

QUEST: US-Israeli officials could meet as early as next week. They will now discuss Israel's planned military offensive in Raffa.

The White House says the Israeli Prime Minister Benjamin Netanyahu has agreed to reschedule the delegation after he canceled it last week. Now,

you'll remember, of course Israeli stepping up its attacks on Raffa with the Palestinian officials saying at least 11 people were killed on

Wednesday when a residential building was struck.

The prime minister of Israel, Benjamin Netanyahu says, he believes an Israeli victory in Gaza will come soon.

(BEGIN VIDEO CLIP)

BENJAMIN NETANYAHU, ISRAELI PRIME MINISTER: We've killed many senior leaders, including number four in Hamas, number three in Hamas. We will get

number two and number one. That's victory. Victory is within reach. It is a few weeks away.

(END VIDEO CLIP)

QUEST: According to witnesses in Gaza, at least 12 people drowned this week trying to retrieve humanitarian aid, which was dropped from the air.

Hamas has condemned the airdrops as useless and offensive and it is calling for more land crossings to be opened instead.

Jomana Karadsheh has this report, and it is disturbing in parts.

(BEGIN VIDEOTAPE)

JOMANA KARADSHEH, CNN INTERNATIONAL CORRESPONDENT (voice over): As they spot a plane and the aid it begins to drop, they run as fast as they can.

It's the rush of a people so desperate, so hungry, who would do anything to feed their children, now on the brink of starvation.

This is what survival in Gaza has come to, fighting for food. That little bit of aid that makes it into the north, where a manmade famine now looms.

People chase parachutes that fell into these choppy waters. It is desperation that drives them into the sea.

What you're about to see next is disturbing. It's the reality of a war growing more cruel by the day. The fastest, the fittest emerge with boxes

of American issued meals ready to eat; others, didn't make it out alive.

People gather around the thin, frail body of a man who drowned trying to reach that aid. Twelve people drowned, according to paramedics.

(ABU HAMAD speaking in foreign language.)

KARADSHEH (voice over): "The parachutes fell into the water," Abu Hamad (ph) says, "But people want to eat. They went into the water and drowned.

The current was so strong, they didn't know how to swim." It's what you do when you have nothing left to lose.

(UNIDENTIFIED MALE speaking in foreign language.)

KARADSHEH (voice over): "A man goes in swimming to get food for his children. He returns dead," this man says. "Bring us aid through the land

crossings. Our children are dying. We are dying. What are you doing? Where is the world?"

The world has been piling up life-saving aid into trucks stuck at land crossings, seemingly powerless in the face of Israel that's accused of

using starvation as a weapon in this war, a charge it denies, forcing the international community to resort to dropping aid from the sky.

Several countries carried out aid drops on this day, deliveries that have been criticized for being ineffective, insufficient, and unsafe.

Earlier this month, another airdrop disaster when a parachute failed and eight packages came crashing down, killing at least five people.

It's a war that's testing humanity, and many say this is what failure looks like.

Jomana Karadsheh, CNN, London.

(END VIDEOTAPE)

QUEST: Now, the feud between Ron DeSantis and Disney has finally come to an end. The parties have reached a settlement over the theme park's standing

in Florida. It brings an end two years of litigation.

The two sides agreed to drop various lawsuits and settle the differences out of court without admitting fault or liability.

[16:20:11]

It all goes back to Florida's law, the Don't Say Gay Bill, which of course restricts school lessons about sexual orientation and gender identity.

It is a badge for honor for Ron DeSantis, and in his run for president, he touted it frequently.

Hadas Gold is with me in New York.

All right, so they've agreed to settle their differences, but did Disney get -- who got what in that?

HADAS GOLD, CNN CORRESPONDENT: I don't think it is a badge of honor for Ron DeSantis as you said. This is a stunning turn of events, a capitulation

really for Disney, and I think it is a signal that Disney, and especially Bob Iger wants to put these past two years behind them.

Bob Iger and Disney, they don't want to be the center of a culture war. This is something that Bob Iger has said on the record. He doesn't want

Disney to be the center of the culture war.

Disney and Bob Iger, they want to be the center of your entertainment, the center of your living room, not the center of a culture war, especially as

they're going into this 2024 election.

And for Ron DeSantis, this fight with the wokeness of Disney as he would call them, that was a central part of his presidential campaign, but that

campaign is now over and listen, Florida, they want the billions of dollars that Disney brings in. Disney had already threatened or had already

canceled an office complex that they had planned, and they also need the tens of thousands of jobs that Disney brings to them.

Now, as you noted, this all started with that, Don't Say Gay Bill in Florida education and Disney under, Bob Chapek had come out against this,

and in retaliation, Ron DeSantis had revoked this special governing district that Disney had.

Now, Disney essentially was allowed to self-govern itself. The land that its parks sit on, this was a special deal that they had had in place for

more than 50 years. So in retaliation to their opposition to the Don't Say Gay Bill, Ron DeSantis revoked that special status.

This sparked several lawsuits back-and-forth between Disney and Florida. Now, it is settled.

Disney has dropped its legal fight, but they still have lost their special governance status, so they are not allowed anymore to self-govern

themselves in the same way that they had been doing for the past 50 years. So they have still losses, but they did gain something because now the

person that Ron DeSantis has put in charge of the new governing board is seen as a little bit more amenable potentially to Disney than the person

who had been in charge before.

In statements we have received from Walt Disney World, from their president, they say that this opens a new chapter of constructive

engagement with the new leadership and serves the interests of all parties.

Ron DeSantis, for his part, has sounded a bit more victorious. He says that he feels vindicated.

Take a listen to what he had to say earlier to reporters about this.

(BEGIN VIDEO CLIP)

GOV. RON DESANTIS (R-FL): The many seniors out -- you know, four or five million seniors in this state demographically, it is really important and

we've done a lot, our Department of Elder Affairs, the Florida legislature, there has been a lot, but this is a target rich environment, this state,

for exploitation because you have a lot of seniors and you also have a lot of seniors that are retired and they have some income. So people that want

to do harm do gravitate now.'

We have good penalties and we've done a lot, but that's just the reality that we find ourselves in.

(END VIDEO CLIP)

GOLD: Okay. So that was unfortunately not the soundbite that we were trying to pull from Ron DeSantis, but what he did say was he said that he felt

vindicated. He said a year ago, people were trying to act like all of these legal maneuvers were going to succeed. And he says, the reality is, here we

are a year later and not one of them has succeeded.

He says, every action that have been taken was -- is the state is now better off for it.

Now, Richard, Disney has put this fight almost entirely to bed. There are still a few loose ends for them. A federal lawsuit that still potentially

could go forward. But for Disney, they have a bigger fight on their hands, of course, and that is next week. That is when they have that shareholder

meeting and the billionaire activist investor, Nelson Peltz, who has been very critical of Iger, he is seeking those two seats, so that will be a

very big battle to watch out for next week -- Richard.

QUEST: I am grateful, Hadas Gold, thank you.

Baltimore's port closure is forcing businesses to ship elsewhere.

The head of Nissan America is with me next, the carmaker is taking its business to New York and New Jersey, and well also talk about Nissan's new

idea. It is called, The Arc. What does it mean? In a moment.

(COMMERCIAL BREAK)

[16:28:01]

QUEST: Hello, I'm Richard Quest. There is more QUEST MEANS BUSINESS in a moment.

I will be speaking to the United States chief executive of Nissan, head of Nissan America about the shipping disruption caused by the Baltimore bridge

collapse.

And the chief executive of IAG -- British Airways, Iberia, Vueling, Air Lingus -- he tells me how his airlines are preparing for a summer season of

travel. We will only get to all of that after the news headlines because as you well know, this is CNN and here, absolutely, the news always comes

first.

Lawyers for Hunter Biden, the son of the President Joe Biden are trying to have nine felony charges against him dismissed. His lawyers are appearing

before a federal judge in Los Angeles today. The president's son has pleaded not guilty.

Police in Germany said at least five people were killed when a bus crashed near Leipzig. More than 50 passengers were believed to be on board the

bus. The company said 20 were hurt.

The bus was traveling from Berlin to Zurich. Police say they are investigating the cause.

Amazon says it invested an additional $2.7 billion in the AI startup, Anthropic. It put in one-and-a-quarter billion back in September. It is

Amazon's largest outside investment in its 30-year history.

Officials in Baltimore are working on plans to refloat the Dali, the ship that collided with the Francis Scott Key Bridge on Tuesday. US Coast Guard

says engineers will remove parts of the bridge, the road bridge that are sitting on the Dali's bough. You can see it pushing it down. That will

lighten the weight, then they can work on refloating the vessel and clearing the waterway.

It is a complex and very dangerous task, but right now, search operations are still underway.

[16:30:08]

When the bridge was built in the late 1970s, container ships like the Dali simply didn't exist. Now these vast behemoths are essential to feed global

supply chains.

CNN's Ivan Watson reports.

(BEGIN VIDEOTAPE)

IVAN WATSON, CNN SENIOR INTERNATIONAL CORRESPONDENT (voice-over): Behemoths of the sea. International trade depends on mammoth vessels like this,

container ships, the kind that brought down Baltimore's Francis Scott Key Bridge in an instant.

Up close, you realized just how huge these ships really are. This container ship here, it's a bit larger than the Dali. That is the Singaporean owned

container ship that brought down the bridge in Baltimore this week.

(Voice-over): The Dali was built in 2015 and is 300 meters or 984 feet long, capable of carrying up to 10,000 20-foot shipping containers for a

dizzying variety of commercial interests.

SAL MERCOGLIANO, MARITIME HISTORIAN, CAMPBELL UNIVERSITY: When you look at international shipping, this is kind of a typical case. Here's a Singapore

flag vessel with a Singapore company leasing the vessel to a Danish company. The insurance for the cargo is British. The classification society

that observes the vessel is Japanese.

WATSON: There have been three deadly incidents recorded aboard ships managed by the Dali's operator Synergy Maritime in the last six years. An

accident with a ship elevator killed a crew member in Australia in 2018. In 2019, an officer went missing after having likely fallen overboard in

Singapore. And last year, a collision between a Synergy Maritime tanker and a dredging ship killed at least one sailor.

Meanwhile, in June of 2023, Chilean authorities briefly held the Dali reporting a deficiency for unreadable pressure gauges related to propulsion

and auxiliary machinery.

MERCOGLIANO: This is what you want. You want, you know, inspectors to go on board and find the issues. And are they corrected? Now the bigger issue

here is going to be, did this ship have certain violations that were causing it to, you know, indicate a kind of habitual problem.

WATSON: Synergy says it's cooperating with U.S. investigators. And the spokesman tells CNN it would be inappropriate to discuss any previous

incidents at this time." Singaporean transport officials say the Dali's crew reported a momentary loss of propulsion shortly before it slammed into

the bridge in Baltimore.

Look at the size of this container the ship next to Hong Kong' Stone Cutter Bridge. At the time the Francis Scott Key Bridge was constructed in the

late '70s, container ships like this simply didn't exist. They were not being built at that size and scale in those days.

(Voice-over): Just last month, China witnessed a deadly cargo ship collision with a bridge on the Pearl River in the city of Guangzhou. At

least five people died as vehicles plunged off the stretch of collapsed bridge. Authorities initially blamed the crew for the accident. Global

supply chains rely on these enormous ships to move goods around the world.

The Baltimore bridge disaster may force some to reconsider the size of these ships and the potential damage they can do when things go wrong.

Ivan Watson, CNN, in the port of Hong Kong.

(END VIDEOTAPE)

QUEST: Now, Baltimore's port is a major shipping hub. It handles more than 850,000 vehicles of one sort or another, and the port's closure creates

logistical challenge for auto makers.

Nissan is planning to divert its shipments to ports in New Jersey and New York. It's a critical time for the car maker. Nissan is wanting to sell a

million cars this year and it's launching 30 new models by fiscal '26.

Jeremie Papin is the chairman of Nissan Americas. He joins me from New York.

Good to see you, sir. Thank you. Before we talk about your future plans, just update me on your plans for how you will handle what happened as a

result of Baltimore.

JEREMIE PAPIN, CHAIR, NISSAN AMERICAS: Good evening, Richard. Yes. On Baltimore, let me start by saying that really my thoughts go to their

families, friends, colleagues of the victims of this terrible accident. And as regards to business as you've mentioned, the Baltimore port has been a

very good partner to our business over the years. This week, we've managed to reroute our ships to other ports on the East Coast of the U.S.

And I believe we will have a very limited if any disruption to our business in the near term due to the port and we are looking forward to working out

longer-term solutions and coming back to the port whenever it's ready to do business again.

[16:35:01]

QUEST: The fascinating part about this is the business geeks like me and on the commencement, it's a reminder of the fragility, you know this better

than I do, obviously. The fragility of supply chain and links in supply chain. You know, if you've got ships having to go round the Cape instead of

up through the Red Sea and the Suez Canal. If you've got a Panama Canal, we can't go as deep. And for a global supplier like yourself, that's a

challenge.

PAPIN: It is, it is, and we've been learning it as an industry the hard way through COVID and semiconductor crisis. And it means having a much better

understanding of what the flows of paths are as well as having the flexibility, adaptability with the teams, and finding solutions fast, and

ultimately really making sure you produce where you sell, and you can control much more of your -- of your supply chain routes and, you know,

that's what this industry is going to be about. That's how Nissan is conducting its business in North America.

QUEST: Talk about the business. Now the EV business, we've -- I won't say they're being shunned, but the number of EV's being sold in North America

is not where it was or should be or needs to be. And if I look at your strategy, the arch, you're still talking about ICEs, internal combustion

engines, new models for that, and you're still talking about basically 50- 50. Quite a long way out.

PAPIN: Yes. I think we have reasons to think the consumer, you know, will be gradually, but really surely moving up towards EV, full EV penetration

and demand. We think we will be selling in the USA more than 40 percent of our cars as EVs in 2030. Now that obviously is a steep curve from where we

are now. But every consumer survey we look at, EV consideration is growing.

EV satisfaction is extremely high. EV loyalty to the power train is extremely high. And so mechanically it just builds into one another. But as

you mentioned, in our midterm plan, we've got seven new models coming to the U.S. in the next three years. We will have ICE, EVs, hybrids, and PH

EVs, and what we want is the consumer to choose what he wants, not us deciding for him.

QUEST: This idea of launching 30 new models by fiscal '20, look, are they really new models or are they just versions of the same thing with a bit of

trim changed?

PAPIN: We are talking real full model changes and new powertrain introductions, Richard, and that's no small feature, but we know that's how

you grow your business. Product drives the momentum, product drives the brand image, product drives the consumer interest, products from one

generation to the next are a step-up in terms of technology, and what we offer the consumer. And so we've worked out to get those 30 cows on the

road.

Again, very diversified power train so that we just make sure in each region the consumer gets what he wants.

QUEST: Sir, I'm very grateful for you. You'll have a run-in at Nissan together. That's what we have to need to do. Thank you.

PAPIN: Thank you.

QUEST: Rent the Runway, the company that let consumers buy or borrow close is trying to avoid D listing from the Nasdaq, and it's doing it in a

fascinating way, really fascinating. Most companies do a stock split. They go up, you had this, you're going to have more. This is doing a reverse

split. You had 20. Now you've got one. They're consolidating their shares because just as if you do a normal space, the price, it goes down here.

Here, the price will go up by a 20 to one ratio.

And the reason is Nasdaq has warned it's running afoul of the rules of listing. And the key one here is this one. There. The Rent the Runway

shares have been stuck below $1 for the past six months. That's significant. It basically means Nasdaq wants to kick them off and that

reverse if they were that kicking off would have happened on the 15th. That's the deadline. So they have two weeks basically from the moment that

they do the reverse split, to see if they're going to actually stay on the Nasdaq before the deadline itself.

It's a bizarre, somewhat unusual way to do business. The reverse stock split. But it begs the question, what's gone wrong? Why is something --

Rent the Runway is quite a nice idea.

[16:40:03]

Nathaniel Meyersohn is in New York. So what did they -- what's gone amiss, awry if you will, with their clothing?

NATHANIEL MEYERSOHN, CNN BUSINESS CORRESPONDENT: Well, Richard, I'm glad we have you to explain the reverse stock split to me because I didn't quite

understand, but I can tell you a little bit about why the company is struggling. There are a few key reasons why this darling really has fallen

to under $1 a share.

The first key reason I think is fatigue with subscription services. We have so many different options for subscriptions. And as we have more, that

causes people to rethink some of what they're spending. Rent the Runway has been a casualty of that. There's also a lot of competition right now among

startups that offer a similar business model to Rent the Runway, including one from urban outfitters called Nuuly. So more competition for these

customers.

And then we've also seen a return to in-person shopping post-pandemic and, you know, Rent the Runway is exclusively online, but people want to be able

to see what type of clothes they're buying, whether the fit is right or the color is right. And so online shopping is not kind of a cure all for a

clothing shop.

QUEST: OK. Now, so all good points and Rent the Runway can do a bit of financial shenanigans if you will to stay on the market. But what would

they need to do to re-establish or to reinvigorate the business? Is that even possible? I mean, I don't know.

MEYERSOHN: So I'm not sure that it's possible, Richard, especially as they've fallen so far and as new entrants come into the market. But they do

have a few strategies to try to get back on track. You know, first of all, they're shrinking. They're getting a little bit smaller to try to cut

costs. They're going to go all in on marketing, try to kind of reintroduce people to the brand, get people excited again with the brand.

And then they're going to try to, you know, add more styles, add more designers. But again, these are smaller tweaks that don't get at the core

of whether, do people want to just exclusively be renting clothing, and do they just want to be doing it online?

QUEST: Fascinating question. I can -- OK. I've got a lot, but before it, have you ever rented any closing besides a tuxedo for maybe for a wedding?

MEYERSOHN: No. And I think that's the problem.

QUEST: Yes.

MEYERSOHN: There was so much interest in rent, not just for clothing, Richard, but also for furniture. Different -- Ikea and some of these other

furniture companies were thinking maybe people would rent furniture, and it would be good for the environment to have this circular economy, but it is

just not landing with consumers quite enough.

QUEST: Nathaniel, thank you very much. I've just been told in my ear that our producer, executive producer Pamela, she loves to rent her clothes. Who

knew? Thank you.

Coming up, "Call to Earth" guest editor Austin Gallagher partners with tiger sharks to make a game-changing discovery in the Bahamas.

Pamela's clothes. Now there's a thought.

(COMMERCIAL BREAK)

[16:45:59]

QUEST: Throughout the week, "Call to Earth" is turning the spotlight on the Bahamas. An organization working to advance ocean research and

conservation, it's Dr. Austin Gallagher who's launched beneath the waves nearly a decade ago and today we look at how a unique partnership with an

Apex predator led to the discovery of the planet's largest seagrass meadow. And it's in Bahamian waters.

(BEGIN VIDEOTAPE)

ZAIN ASHER, CNN ANCHOR (voice-over): Early morning on the western tip of Grand Bahama, the northern most of all the Bahamian islands and just about

100 kilometers from the U.S. state of Florida's coastline.

DR. AUSTIN GALLAGHER, FOUNDER AND CEO, BENEATH THE WAVES GROUP: The Bahamas has really been a second home for me for as long as I can remember. Dating

back to some of my first times ever going on scuba-diving trips, learning how to enjoy and swim in the ocean. And it's just really remarkable because

it supports so much life. So for me, as a younger scientists that was fascinated with animals like sharks, this was really ground zero.

ASHER: Dr. Austin Gallagher is the founder and CEO of Beneath the Waves, a non-profit organization currently based in his hometown of Boston,

Massachusetts.

GALLAGHER: We do marine research projects all over the world. Really focused on advancing discovery in our oceans and collecting the data that

governments and communities need in order to better co-exist with our oceans.

ASHER: Accompanied by three members of his team, they've come together from different points in the U.S. and the Caribbean for a four-day research

expedition. To kick things off they're heading out to Tiger Beach, a well- renowned dive spot that as the name suggests is famous for an abundance of one of the ocean's most prolific predators and Austin's favorite research

partner.

GALLAGHER: This is a place that I've been studying for a long time. And I've seen tiger sharks all over the world. This continues to be the most

special place for seeing tiger sharks. Completely protected here from fishing. They've been benefiting from almost 30 years of conservation

measures.

All right, guys. All right. Let's see you down there.

UNIDENTIFIED FEMALE: Let's go swim with the big sharks.

ASHER: Labeled as near threatened on the IUCM red list, they can grow up to seven and a half meters in length, but are more commonly in the three to

four-meter range weighing between 385 and 635 kilograms.

GALLAGHER: Tiger sharks are the largest predatory shark in tropical waters, and they are really like the Swiss Army knife of the shark world.

Incredibly flexible diet. Wide-ranging behavior. It can tolerate very large range in temperatures. And they're found pretty much all over the world.

Just so nice to take a minute to realize how beautiful they are, and this is really why we need to protect the species in this ocean and we have so

much to learn. So it's a really good first dive.

ASHER: For the second dive, they've decided to set up at a seagrass meadow, a seemingly inconspicuous patch of green on the ocean floor. But to Austin,

it signifies so much more.

GALLAGHER: I've learned that the behavior of tiger sharks is completely different in seagrass meadows.

ASHER: From 2016 to 2020, the Beneath the Waves team conducted a study where they equipped tiger sharks with cameras. The aim was to gain a better

understanding of what a day in the life of the animal looked like. What came back was hours of groundbreaking footage that would change the

trajectory of their research.

GALLAGHER: We're just at the beginning of understanding how valuable and how important this seagrass asset is. Seagrasses, mangroves, they are what

we call a nature-based solution to climate change.

[16:50:03]

So if we want to try and build resiliency, if we want to try and enhance coastal protection, and create benefits for communities and biodiversity,

going out and quantifying how much carbon and what the extent of that looks like is incredibly important for ocean research.

(END VIDEOTAPE)

QUEST: And you can see the special half program "Call to Earth: Expedition Bahamas," it's on this Saturday and Sunday here on CNN.

(COMMERCIAL BREAK)

QUEST: It's nearly summer. Hello, the clocks will change in Europe this weekend so summer season could only just be around the corner. Airlines

have their work cut out for them. Whether it's strikes, planes grounded, high passenger numbers, IAG is the parent company of airlines like British

Airways, Iberia, Aer Lingus. And the chief executive of the group told me how he is preparing for what's going to be a very, very busy summer.

(BEGIN VIDEOTAPE)

LUIS GALLEGO, CEO, IAG: So British Airways, we are investing a lot for the summer. Last summer was not as good as we want. We've had higher in the

group this year, (INAUDIBLE) people and we are adding resources to the operation. In January, punctuality was around 80 percent in British

Airways, February even above. So I think we are going to arrive to the summer in a much more better situation.

QUEST: You announced quite a large investment in British Airways over the next several years. This is really a reflection of underinvestment in the

carrier over many years.

GALLEGO: No, I don't think so. I think we know that we have already important brand, our premium brand, and we want to invest in the customer

and in the future of British Airways, so we are going to invest seven million pounds in the next three years, aircraft but everything that is

related to the customer.

QUEST: You're in the middle of trying to complete your purchase of Europa. And what's taking so long ?

GALLEGO: We started operation in November 2019 before COVID. We didn't expect something like that so we need to abandon the operation, and then we

started again. We acquired 20 percent of the company. We close our agreement for the remaining 80 percent. And now we are in the middle of the

approval with European competition authorities.

[16:55:03]

QUEST: You will agree that consolidation, there needs to be more consolidation in Europe. Now, TAP is going to be -- TAP Portugal is going

to be the one that's probably the next biggie on the mark. You interested?

GALLEGO: We need to say the conditions, what we said our first priority now is Air Europa because we want to reinforce Madrid cap in order to compete

with a strong North European hubs. But we consider that TAP, if there are the right conditions, can be an opportunity for us, but let's see what the

government in Portugal they say.

QUEST: Can you see, can you imagine the Portuguese letting the Spanish?

GALLEGO: I think IAG, us using our name, International Airline Group, we've had the same debate when we did the operation of Aer Lingus, for example.

Some people they said, no, British Airways and London is going to kill (INAUDIBLE). But when you see the evolution of Aer Lingus, this is the

airline with more growth in the group. We consider that if it's possible to do this operation, both of us, we are interested. We can have similar

strategy develop to our hub model in the (INAUDIBLE).

QUEST: It would be very powerful.

GALLEGO: I think so. And I think it's an opportunity for the south of Europe to compete also with the north. Because when we talk about

competition, it's not only route by route, but it's also north, south, and I think it's good for Europa and for the customers.

(END VIDEOTAPE)

QUEST: The CEO of IAG. We'll take a "Profitable Moment" after the break.

(COMMERCIAL BREAK)

QUEST: Tonight's "Profitable Moment," we have two interesting stories on the stock market this week. The first, of course, was about Donald Trump's

Truth Social and how it launched. A company that has no economic reality but managing to get huge value. And tonight, we told you about a store -- a

company Rent the Runway, which has lots of economic evaluations. It rents clothes and people do it and they rent or buy. But it's D listing because

its share price has been under $1 for more than six months.

Now you've got to ask yourself about this renting of clothes. I mean, think about it. We have no problem if it's renting a tuxedo or you rent a morning

suit for a particular event. But then when it comes to renting clothes on an everyday basis, well, I don't know. I've ever tried it. Is this just an

internet thing that people of a certain age would ever do? And people of another age have tried and don't really like or don't want to continue

doing it? Is it more hassle than it's worth?

The whole concept was brilliant. You can rent something elegant. You convince me, a rather nice enterprise. But then it all seems to have gone

rather pear shaped because people simply don't want that sort of thing. What is it that we want? And that remains the biggest question of all.

And that's QUEST MEANS BUSINESS for tonight. I'm Richard Quest in London. Yes. I remember tonight. Whatever you're up to in the hours ahead, I hope

it's profitable.

"THE LEAD" comes up next.

END