tv BBC Business Live BBC News March 18, 2019 8:30am-9:01am GMT
this the headlines. you're watching bbc news at 9am with me, carrie gracie. the headlines. police confirm three teenagers have died following a crush at a st patrick's day party in county tyrone. it appears to be at the minute this is business live a crush, people have fallen and from the bbc with ben thompson and ben bland. then been fatally injured. a banking mega—merger in the pipeline? new zealand's prime minister deutsche bank and commerz bank says her government will move confirm they are in merger talks but unions warn 30,000 quickly to toughen the country's gun jobs could be at risk. laws following the deadly attack live from london, on mosques in christchurch. theresa may will make fresh attempts that's our top story to win over conservative and dup mps to her brexit deal, while former foreign secretary boris on monday the 18th of march. johnson says it would be absurd to hold a third vote before attempting further talks with the eu. 0ysters are to be re—introduced the confirmation ends months to the humber estuary in an attempt of speculation that the two to improve water quality struggling german banks could merge and encourage marine life. to make massive cost savings. prada takes a massive hit to sales,
following concern that spending in asia is waning. and prepped for the piste — we'll talk skiing and the cost of kit with the founder of one firm that's navigating the red run of tough competition. and there's been a lot of discussion about the responsibility of social media companies around the videos posted during and after the new zealand attacks. today we want to know if social media giants should do more to stop such content writing. —— spreading. use the hashtag bbcbizlive. hello and a very warm welcome to the programme. it is a busy monday in the business world so we will bring you up to date with what you need to know. it's been the talk of german financial circles for months. now the country's two biggest banks — commerzbank and deutsche bank —
have confirmed they're in merger talks. a combined bank would have roughly $2 trillion in assets, such as loans and investments. it would have a market value of around $28 billion and a fifth of the german retail banking market. a merger could result in massive cost savings, in particular by closing branches. but the deal is opposed by the german union for the service sector, verdi. that is how much they will save, they suggest. it's warning that up to 30,000 jobs could be cut in the long—term. deutsche bank has stressed that any merger will not be rushed. it is important to us that we will only engage in a transaction if it makes economic sense and therefore it needs a plan, especially a good integration plan. together with commerzbank we will now evaluate this. we will have due diligence. and only when the results are there, we will take a decision.
let's talk about oil. saudi arabia has signalled that the club of oil producing countries — opec — may need to cut oil output even more in the second half of this year. global stockpiles are still rising despite harsh us sanctions on iran and venezuela — both major oil exporters. some energy ministers from opec and its allies, like russia, have been meeting in azerbaijan ahead of a full meeting next month. we're joined by caroline bain, chief commodities economist at capital economics. what do you make of this? we pay such close attention when 0pec meet. what has changed? we have had a sharp rise in the oil price at the end of last year, which is due to the cuts and also the involuntary loss of iranians and venezuelan barrels. at the same time we have got record us production. 0pec must be feeling slightly nervous about its market share given the rise in
us production, but at the same time it is enjoying the higher prices. it is quite a difficult time for them to decide the best course of action. when it comes to the significance of russia, how important is it for 0pec to keep russia on side, even if it is outside the official club. it is very important. 0pec plus russia accou nts very important. 0pec plus russia accounts for a very large percentage of world production, obviously. so far we haven't seen much reduction in russian production, despite what they said. they have said it is difficult to cut during the winter and we will see them coming through now. there is also the risk of higher prices and we will see those cuts coming through. brent has been steadily rising, despite ongoing concerns of a slowdown in many parts of the world. we might end up in a period where prices are high and demand is falling and the two paint a very different picture and look very different. this is something we
have been saying. all the narrative is about supply at the moment and people are not remembering that we saw the sharp slowdown in the eurozone and japan. we think the us economy will start to slow in the second half of this year and inevitably that will lead to slower growth in oil demand. potentially 0pec does have to think about whether it needs to cut more. the other important thing for 0pec, not only to talk about cats, but to actually get all the members plus the allies to follow through on them. yes, 0pec is very good about talking up and down the price, depending on what they will. compliance in february, which is the latest data we have got, was only 67%. what does that mean, 67%? it 6796. what does that mean, 6796? it means that 67% of countries cut. 6796. what does that mean, 6796? it means that 6796 of countries cut. so about two thirds stuck to what they said they were to do? yes. the bulk of the cuts are coming from saudi
arabia. caroline, thank you very much. we will speak again about oil and 0pec, i'm sure. thank you. we promised you a busy day in the business world, so let's bring you up—to—date with other stories from around the world. ethiopia's transport minister says flight data from the ethiopian airlines disaster a week ago suggests clear similarities with a crash off indonesia last october. both planes were boeing 737 max 8 aircraft. all 157 people on board the ethiopian airlines jet were killed when it crashed a week ago after taking off from addis ababa. president donald trump's trade battles cost the us economy $7.8 billion in lost gdp last year. that's according to a study by a team of economists at leading american universities. they also put annual consumer and producer losses from the higher cost of imports at $69 billion. new figures show japanese exports fell for a third month in february as global trade wars take their toll.
exports slipped 1.2 percent from a year earlier, while imports declined almost 7 percent, in a sign of a potential slowdown in the world's third—largest economy. eurostar has told passengers only to travel from paris to london if absolutely necessary. its services have been hit by delays with long queues due to industrial action by french customs officers. four trains were cancelled on sunday. the firm has also cancelled three trains on monday, two on tuesday and three on wednesday. luxury fashion house prada has taken a massive hit to its sales in china. pre—tax profits for 2018 were down ten percent and far short of what analysts were expecting. it's not just prada that is struggling in china though. consumer spending across a lot of luxury items is down. let's hear more from monica miller who's in our asia business hub, in singapore.
what is behind the slowdown? chinese customers, particularly the new middle class, have become more cautious in their spending due to the slowdown of the economy which is having a chilling effect on the luxury market. prada isjust having a chilling effect on the luxury market. prada is just the latest to report its stocks were down more than 9% in hong kong. its share price has fallen 31% in the last 12 months. the luxury brand reported that its revenue was up for the first time in four years, however the china merchant banks slashed its price target below expectation due to the rising production costs and higher operating expenses. prada joined gucci last friday when it said it would start offering end of season promotions at its stores in a bid to boost margins and protect its brand. thank you, monica. clearly all of us have stopped shopping at prada! the chance would be a fine thing! let's show you the numbers. in asia, a bit of optimism actually. in hong kong, tracking what the mainland chinese
market did, because of a bit of optimism about the ongoing trade wars. we will hear from the fed later this week and they might have a better update than expected. but also the chinese authorities may move to prop up growth in the economy there. that is what ager is doing. let me show you europe. —— thatis doing. let me show you europe. —— that is what asia is doing. this will be another crucial week in europe. we have said it before and we will say it again, that it is a big week in the brexit negotiations with the prime minister taking her deal back to mps for a third time but will it be third time lucky? we will find out on tuesday or wednesday if that vote will go ahead. it could be instrumental in terms of determining what will happen next in terms of the uk's departure from the european union. that is the state of play and we will get more later. now the details of what is happening on wall street.
the news that will likely dominate american financial markets this week is the outcome from the meeting of the federal reserve, that is the us central bank. the committee will meet for its regular two day meeting beginning on tuesday, and at this meeting, board members will discuss whether it should vote to raise us interest rates. the expectation however is that it will again signal to investors that the fed will be patient before deciding whether to hike interest rates again. most recently, the chair of the us federal reserve, jerome powell, has said that the central bank does not feel any hurry to make changes to interest rates. the committee will announce their decision on wednesday. joining us is simon derrick, chief markets strategist at bank of new york mellon. the fed meeting later this week will bea the fed meeting later this week will be a big factor on the markets. the fed meeting later this week will be a big factor on the marketslj think be a big factor on the markets.” think it is. over the course of the last few months, the message from the us central bank has changed. if
you go back to october and november, they were very gung ho about hiking rates and continuing to take money out of the system. let's call it quantitative easing's opposite, quantitative easing's opposite, quantitative tightening. but now there are concerns about a global slowdown and what is happening in markets. the message has changed. we are likely to see them perhaps announced that they will bring to a close this programme of reducing their balance sheet. the jobs figures were quite disappointing for the previous month. yes, and you have always got to take that in terms of the longer run, but those numbers were definitely there. but that idea that maybe there would be a slowdown in the us are starting to build, and a backdrop of a global slowdown is the key story here, i think. by the way sally is poorly, she has lost her voice. if she is watching she will be delighted that we are talking central bank action. she is a fan of it! and the bank of
england is in focus as well. in fairness to the bank of england, what can they say? we are in the middle of brexit and they are not likely to tell us anything at all. that tells you what really matters for the uk this week, which is what will happen on tuesday and wednesday. if anything at all. there was already a messages yesterday that they would not take the vote if they did not think they would get it through. do we have that? do we have ano through. do we have that? do we have a no confidence vote? pound sterling continues to gyrate around every little bit of this. i'm tuesday and wednesday we might get an indication of what is happening, but that is not the end by any stretch. it is the start of a new period perhaps more uncertainty. let's hope it is the start of a new period! i think we are getting fed up this point. 0bviously we are getting fed up this point. obviously we go to the eu council and we hear what comes back in terms of whether we get an extension or not. it is not a done deal. the comments might vote for it but it is
not a done deal. totally. -- the house of commons might vote for it. totally but the markets like that. and the pound sterling could go up. it could go up because no—deal brexit is less likely but also no departure at all? i think it is because the market likes when it keeps the options open. if there is an extension, along extension, the idea of ending up with a referendum, and even remain vote, which keeps the pound sterling buzz happy. there are the pound sterling buzz happy. there a re lots of the pound sterling buzz happy. there are lots of places this can go wrong. gosh, raining your optimism! it is monday morning! good to see you. still to come we will talk about being prepped for the beast. we will talk skiing and the cost of the kit because we know it can be pretty expensive to have a winter
holiday. we will talk to the fad of one firm that is navigating the red run of tough competition. you're with business live from bbc news. uk budget hotel operator travelodge has reported strong growth in sales in 2018, marking a turnaround since the company nearly went into administration five years ago. with brexit looming and other problems such as rising costs adding pressure, could 2019 be a rocky year for the hotel industry? let's hear from travelodge chief executive peter gowers. an interesting and good strong set of results for the previous year but how are things looking as you cast your eye over the next 12 months? you are right, they are a strong set of results which shows just how far travelodge has come over the next five years. and that —— the last five years. and that —— the last five years. and that —— the last five years. but your comment is spot on that there are a number of
headwinds facing the uk and the best thing we can do as a business is raise our quality levels and be ready for customers which is what we are doing. an interesting statement today, about how parents returning today, about how parents returning to work could be one of the solutions to any labour shortages after brexit. that is right. the third -- after brexit. that is right. the third —— a third of our workers come from the eu 27 so we need to prepare for that brexit situation, and so we have got to raise our game. we had a lot of applications last month, and working parents made up a big proportion of that. it is flexible working and also you can step up the career ladder. many people move up the runs of management with us. business rates are rising and the wages that you have got to pay your staff are going up, two costs which you can't avoid and in a low—cost wealth that is pretty difficult for you to contend with. it is. the that
we had last year showed that we can still grow a strong sales performance and it is our fifth year ina row performance and it is our fifth year in a row of outperforming the market. because control is vital and we are taking no steps to automate more processes. our housekeeping teams, who do such an amazing job, can teams, who do such an amazing job, ca n clea n teams, who do such an amazing job, can clean a hotel room in 20 minutes, which is a great deal faster than you or i can clean our own bedrooms, so productivity will be key to the low—cost operators driving over the next few years. peter, it is good to good to talk to you, the chief executive of travelodge. clean my room in 20 minutes? that sounds more thorough than me! 20 seconds more like it! under the bed as well! there is much more on our website, including white foot asylu m more on our website, including white foot asylum shares have soared.
your‘re watching business live. our top story: a banking mega—merger in the pipeline? deutsche bank and commerzbank confirm they are in merger talks but unions warn 30,000 jobs could be at risk. a quick look at how the markets are faring. all in modest territory. the pound hanging on to its gains and we will see if that lasts with the twist and turns of the brexit process this week. it's coming to the end of ski season in europe when visitors head to hotspots in france, italy, switzerland and austria to throw themselves down mountains with bits of plastic strapped to their feet. that is the technical definition of skiing! the popularity of skiing is growing, with around 400 million ski trips made around the world in 2017. there are now more than 2,000 ski resorts worldwide. but all the gear is pretty costly. the global ski equipment market is forecast to exceed
$5.7 billion by 2020, according to latest figures. the us and europe dominate when its comes to top ski resorts, but china and its richer middle—class are increasingly donning goggles and salopettes as the nation gears up for the 2022 winter olympics. chinese winter sports tourism could reap revenues of $5.9 billion for accommodation, equipment and sightseeing by 2020, according to tencent. now big ski equipment makers dominate the industry and that hasn't changed in decades. but a new kid on the block is faction. founded just over a decade ago, its hand—made skis recently won kudos at the x—games in aspen. alex hoye is co—founder and chief executive of faction. alex, you are brandishing your skis and we will make you hold them for the whole interview! that is about this because when we met this morning i told you it was a really
crowded market and you can't move for skiing equipment stuff, the latest must have this and that, that you have decided to do it differently and you are trying to break into this pretty tough market. what makes you different? that is a great question and maybe it comes from where i came from. i took a couple of seasons off after starting an internet company in 99, listing it on the stock market in 2006. i switched back from snowboarding to skiing and! switched back from snowboarding to skiing and i looked around and i felt actually the snowboarders were having more fun and i wondered why. what could be different? if you look at the industry, it is very large, as you have seen, but most of it is dominated by companies that were innovators in the 1950s. there was room for innovation on the skiing side, so we took a lot of ideas from snowboarding, and really focusing on having a lot more fun with it. for people who don't know how skiing and snowboarding work side by side, you can assume they are the same but
they are two different tribes. they are very different tribes, and i think it is like one of those religious wars, where one doesn't notice the other very much, but they don't cross very often. in terms of technique they have two tips and thatis technique they have two tips and that is the biggest difference. where is what you can do... what we brought was getting in touch with ourfans and brought was getting in touch with our fans and consumers and trying to have more fun instead of racing to the bottom. you nearly took our heads off with your skis! there are two end to it and that is very different. it is 1196 of the skiing market and 100% of the snowboard market, or or thereabouts. we started in that area but we have now grown rapidly into flat trends as well, bringing media and attitude to the stagnant skiing market. alex, i will ask the basic question. i am not a skier. are they more likely to
make me fall over or left? they are more likely for you to have fun but i can't speak for yourself! but on a control group basis you will fall over less because they are fatter and easier to turn. they left up off the snow so the running length is quite short and really it is about a whole generation saying, when i grew up whole generation saying, when i grew up in idaho in the rockies, they said of course it is hard, it is supposed to be. by its nature, skiing isa supposed to be. by its nature, skiing is a seasonal business, so what do you do at the end of the season when people don't buy skis? how do you survive? i don't know if you have seen any videos from one of our shareholders, but he has skied the great wall of china and the rocks of turkey, so that could be where the future could go. but in fa ct where the future could go. but in fact there is the southern hemisphere, and as a company we are just getting started on next year's sales. it is an interesting business in terms of how you do a lot of that
marketing. it is your users that do it. you don't spend on advertising and promotion. you also make your own feature length movies. explain this. why? we were looking at this, trying to see what the formula was for getting into skiing. usually you pay a film company that spent 1.5 million on a film to get your logo on there. that will cost you 50 grand. and we said a50 grand we could make that. that isjust product placement in a film? yes, and we said maybe we can. with the go pro, with the steady cam, creativity, we have been able to make films with a fraction of the cast and now millions of people view them on a regular basis. and you have not made a profit yet that this is the year that you do? next year we will lose for one more year and then after that we make profit. we are growing our sales for next year
at 60% right now. are growing our sales for next year at 6096 right now. so it is uphill as well as downhill? we make up her -- uphill skis as well! be careful when you lose the studio because there is a lot of expensive kit, as well as our heads! here is a reminder of how you can get in contact with us. stay up—to—date with all the day's business news as it happens on the bbc‘s business live page. there is insight and analysis from our team of editors right around the globe. and we want to hear from you too. get involved on the bbc‘s business live web page at bbc.com/business. on twitter we are @bbcbusiness. and you can find us on facebook at bbc money. business live, on tv and online. what you need to know when you need to know.
let's have a look at the other stories. simon is back with us. disneyland paris, first profit for a decade. i must admit that i was amazed to hear that. they seem to be finally turning it around. 0ver amazed to hear that. they seem to be finally turning it around. over the course of the last decade they have moved towards having the loan is removed and they have been taken into private ownership by disneyland. the bit that really amazed me is that they are the most popular tourist attraction in europe. how can you be the most popular tourist attraction and still not make a profit? that is astonishing. it is remarkable. the sheer level of spending that must be going on to make that happen. but 15 million people a year ago and they are still only making it too flat, so who knows? maybe they should try b i cester so who knows? maybe they should try bicester village! no wonder he has a big smile on his face, mickey! the us is still pushing on with this campaign to get its allies to ban
huawei but vodafone said it would cause a massive delay to 5g if they cannot use huawei equipment. the interesting thing here is the pushback going against the us and their attempts to clamp down on huawei. 0bviously their attempts to clamp down on huawei. obviously the justice department has been pushing nations to stop using it. but it has been undercut somewhat by this idea that maybe just maybe what the president is trying to do is use this as part of the trade negotiations, and even he has said that if a trade deal was done, things could be slackened off. and even now there has not been an executive order to actually stop huawei in the us. i think the problem is not necessarily whether it is right or wrong. it is the messaging. the idea of hold on, are we just part of a broader trade deal? i think that is the issue. good to get your thoughts, simon.
thank you for being with us and thank you for being with us. thank you for your thoughts on the question of whether social media firms need to do more. follow that online. goodbye. good morning. we had a lot of rainfall over the weekend, in some places more than half the average month's rainfall fell and that gave us localised flooding. thankfully this week it will be much quieter with settled conditions, lighterwinds, will be much quieter with settled conditions, lighter winds, turning milder. there is some rain in the forecast but it is not particularly heavy and it will not last all that long. the rain that we have got this morning is across western areas of the uk. it is like an patchy and it will turn more showery into the afternoon. —— light and patchy. the further east you are, the better the sunny spells, with the odd shower this afternoon. maximum temperatures of eight to 11 degrees. cloud in the west will spread into the east overnight with the odd shower here
and there and it could be misty and murky, especially around coastal areas into tuesday morning. temperatures three to 6 degrees, and not as cold as it was last night. during tuesday we have got this warm front moving east. it will introduce quite a bit of cloud and there could be some patchy rain associated with that warm front. a big ridge of high pressure at just that warm front. a big ridge of high pressure atjust moving towards the south—west, pushing in over the next few days. rain on tuesday, most likely across scotland and the far north west of scotland where it will be most persistent. elsewhere dry and cloudy with some bright and sunny spells trying to break through. temperatures gradually creeping up to 11 or 1a degrees. that is the warm front and it will move east, and into wednesday you notice the orange is taking hold across the uk with milder conditions. we have still got colder and further north, separated by
cloud and some outbreaks of rain in southern scotland, and there will be some sunny spells even in the north of scotland. elsewhere bright and sunny weather is trying to break through the cloud. temperatures will be 15 to 17 degrees for england and wales but ten to 12 degrees for scotla nd wales but ten to 12 degrees for scotland and northern ireland. high pressure dominates for many parts of the uk and it isjust in the north west where we will see some weather fronts brushing the north west coast of scotland. it will stay cloudy with outbreaks of rain here. high pressure so mostly dry over the next few days. quite a bit of cloud but temperatures 12 to 17 and even 18 degrees. goodbye.