tv BBC Business Live BBC News May 3, 2018 8:30am-9:01am BST
this is business live from bbc news with ben thompson and sally bundock. draining the batteries and burning cash, as tesla reports another record loss. live from london, that's our top story on thursday, 3rd may. despite another record loss, the founder of electric car—maker tesla is optimistic the company will be profitable this year. but elon musk faces a barrage of criticism for dodging analysts‘ questions in his earnings call. also in the programme.... a showdown awaits in beijing. team trump fly in as the us and china try to head off a looming trade war. the markets are looking like this... we will have all you need to know about the numbers. also in the
programme. . . and scaling mountains and surviving in the wilderness. we get the inside track on the $20 billion outdoor clothing industry. plus, today we want to know, as the maverick billionaire boss of tesla, elon musk, calls analysts‘ questions boring and not cool, do you find his style refreshing or rude? let us know. just use #bbcbizlive. a lot of messages about that story already. join the conversation, as sally says. we start with electric car—maker tesla. its vehicles may not burn any fuel, but the company is burning through cash at an alarming rate — $6,500 dollars a minute according to bloomberg. that's starting to try the patience of loyal investors.
on wednesday, elon musk, its chief executive, promised that the firm will finally be profitable in the second half of this year, despite another quarter of huge losses. tesla lost almost $710 million between january and march this year. that was its worst—ever quarterly loss and well over twice as much as this time last year. tesla has been pouring money into the model 3 — its first truly mass—market car. that is paying off — total car production is up 40% this year. but tesla still has hundreds of thousands of customers waiting. thank you. alex willard is from the vehicle technology firm tantalum corporation and hejoins me now. you have been looking at tesla's numbers, talking to me earlier about the interesting conference call with a nalysts, the interesting conference call with analysts, give us your take on it.”
thought he was a little bit robust with his critics and analysts, if you look at the presentation they provided to shareholders, he paints a very rosy picture of the business, focus on innovation, technology and road map for the business, but not much on how they will change their fortunes. what is the message for how the company will go from being, frankly, in a bad state from today and yesterday, to being a glowing success and yesterday, to being a glowing success tomorrow? he is hoping to double production in two months. if he does, he will be the first person ever to do it. is itjust promises or can elon musk pulled it off? a lot of bluster and confidence, that is his style, talking about the fact this is a software problem, no one does software better than tesla, your take on that? i do not believe him,i your take on that? i do not believe him, ido your take on that? i do not believe him, i do not think it is a software problem, that is a very glib statement to make. most of the
problems with electric vehicles come from the manufacturing, the automotive engineering. it lets you down. is it about the fact they have gone from a niche maker of very premium vehicles to now the mass—market model? is it about the fa ct mass—market model? is it about the fact they have to produce thousands and there are 450,000 people waiting for their model 3? is it mass production they cannot cope with? they are running too fast or so. automotive manufacturers to typically take three, four years to get a modelling to launch and they go slowly for six months working out what is going wrong, it is called job one. elon musk is taking the approach he takes with software releases, running very quickly. all of his competitors have had time to catch up with tesla. when they first began, they were on their own, and now most of the main car
manufacturers are making something similar. where does that leave tesla and what do you think their future looks like, if investors decide they will not keep calling the company? the model 5 showed us the way, so far ahead of the competition, with its conductivity, driver display, far greater connected core solutions ever seen before. but the big companies, bmw, mercedes, they have not been idle, they are hunting down tesla and i would say that if tesla are unable to meet the market challenges, they can expect to be overta ken challenges, they can expect to be overtaken in the next year or two. interesting, thank you for your thoughts on that. you have sent in so thoughts on that. you have sent in so many opinions already, we will share some later. absolutely. let's take a look at some of the other stories making the news. cambridge analytica, the firm at the centre of the facebook data—sharing scandal, is shutting down. the firm was accused of improperly obtaining personal information of up to 87 million facebook users
on behalf of political clients. the commonwealth bank of australia has been forced to reveal it lost the records of almost 20 million accounts and decided not to inform its customers. following a report by buzzfeed, australia's largest bank admitted it had lost two magnetic tapes containing 15 years of data on customer names, addresses and account numbers, but no pin numbers or passwords. spotify shares have dropped as much as 9% after the music—streaming giant's results disappointed investors. in its first set of earnings since it listed on the new york stock exchange, spotify said revenue rose 26% to $1.3 billion in the first three months of the year. revenues up 26%, still disappoints investors! and yet you have got tesla not making money yet...
people willing to stick with it for a while yet. absolutely. two big stories we're following out of asia today. in a moment, we'll be speaking to sarah toms in singapore about a huge tech ipo. but first to china, as us treasury secretary steven mnuchin, along with a trade delegation, is about to begin talks with officials in beijing. 0ur china correspondent, robin brant, is in shanghai. tea m team trump is there, what progress will they make on the trade spat? we have threats from either side, $150 billion worth of tariffs floating around, president trump tweeting that his financial team has come to china for two days of talks and what they will want to achieve is a level playing field in terms of trade between the countries. the famous five of negotiators have come led by steven mnuchin, goldman sachs
executive turned treasury secretary, the president's trade advisor is also on board, the man who wrote death by china, perhaps the most hawkish. they want $100 billion cut off china's surplus in trade. the bigger push is on china's strategic push to dominate the high—tech industries, aviation, robotics, a big dealfor china, the us thinks there has been a generation of state subsidies and i think it is less likely there is progress on that. 0ne likely there is progress on that. one example of the kind of pressure us firms are being put under, i was told the last few days ford, import and export operations, up at the port in the north—east of china, they have been put on hold and america's number two automotive company linking it to pressure from the authorities ahead of the talks. thank you. and let's cross over now to our asia business reporter, sarah toms, in singapore,
who has the latest on the chinese smartphone giant xiaomi filing plans for a highly—anticipated initial public offering in hong kong. as you said, xiaomi, one of the world's biggest smartphone makers, even known as the apple of china, it is expected to raise a massive listing. it should be at least $10 billion, analysts are saying. if it does raise that much, it would be the largest ipo since 2014 and in fa ct the largest ipo since 2014 and in fact that was another chinese company. if the share sale does make that much, it would put the company value at $100 billion. what else do we know about xiaomi? it is big in china but it is also a major player in india where it has been battling it out with samsung to be the most
popular handset maker. but besides smartphones, it also makes home appliances like air purifiers and rice cookers. it offers intimate services. it has even set up apps offering music and entertainment, like its chinese rival. so there is a lot of buzz and excitement today but there are some concerns. investors are concerned because 70% of the revenue, despite the diversifications, come from smartphones and most of the sales of the smartphones are in china and it isa the smartphones are in china and it is a big problem because the domestic market is actually getting saturated. good stuff, thank you for explaining that, it shows how the global business stories affect each other, thank you. let us show you what is happening on the markets.
japan is closed today, but most asian markets dipped after the sell—off in new york. investors are keeping an eye on those talks between china and the united states over that potential trade war. will they come to some sort of agreement, the us treasury secretary and commerce secretary and the rest of the delegation meeting in china in beijing, will they deliver any a nswers ? european shares slightly lower on the open in what's another busy day for earnings. they have for the force of the balance the strength of the year, four month lows against the dollar, 110w four month lows against the dollar, now back up. yesterday coming as no surprise, policy statements from the us, so we are seeing the movement on the currency markets. we'll talk more about that with our market guest who's standing by. but first, joe miller has the details about what's ahead on wall street today. on thursday, the commerce department is expected to report that america's trade deficit, often the subject of donald trump's ire, narrowed to $50 billion
in march from a gap of $58 billion in february. that ought to please the man in the oval office, and perhaps distract him from stats that are likely to show a modest rise in weekly jobless claims across the country. elsewhere, breakfast cereal maker kellogg's, which has been working hard to accommodate changing tastes by adding healthier snacks and protein bars to its offering, is expected to report higher sales. and amid reports that the new york times is exploring expanding into television, the news organisation is forecast to post a rise in first—quarter profit, as an increase in digital subscribers makes up forfalling print sales. joining us is lawrence gosling, editor in chief of investment week. nice to see you. ben and joe, this
week, so busy, we have had their massive stories at the beginning of the week in retail, mobile phones, mergers, so many the week in retail, mobile phones, mergers, so many burning stories, trump's team in china, it is all happening, the fred, what has caught your attention? extraordinary week. the oil price, go back a year, very low, everyone was talking about deflation, now we seem to have settled around the high 60s, early 70s, we are back in two, is there enough supply? the oil price is one central banks look back to figure out where inflation is going. the federal reserve last night saying they have got towards their 2% target and they are holding interest rates and other market is expected next month the us will raise rates and it will be the study tick upwards people have been talking about for a number of years.
corporate news, update from trinity mirror, publisher of various things including the daily mirror, getting a new name, part of its concerns about whether buying the express and the star would cause competition issues. they are going to call themselves reach, reaching into all of our homes. it does make me smile because it is very difficult to think ofan because it is very difficult to think of an imaginative name for your company few try to change your name and my current company... we are struggling ourselves. we are called vitesse and we are not as speedy as we need to be! elon musk, you were reading about the conference call he had after the reported earnings, the conference calls are reported earnings, the conference calls a re really reported earnings, the conference calls are really important, as much as ceos might hate them, but they have to suffer it. there are a group of people who think he is a genius
like steve jobs and others, they are less persuaded, he veers between genius and tyrant. it is not the way ceos normally told to speak to a nalysts, ceos normally told to speak to analysts, more conciliatory, humble. especially when you need more money. he still thinks he will crack it does your previous guest was saying, he has a long way to go to double the car production. we will talk more about tesla and musk later. loads of messages about this. he may bea loads of messages about this. he may be a billionaire, but manners cost nothing. they may be boring but when you're burning through investor money i think people are entitled to ask questions about why they should be continuing to do so. still to come. there's no such thing as bad weather, only bad clothing, right? after the break, we speak to one company trying to move mountains in the outdoor clothing industry. you're with business
live from bbc news. now, you might be sick of adverts and phone calls reminding you about ppi claims — but apparently we still don't have enough. the fca is calling on people to check again whether they're eligible to claim for mis—sold payment protection insurance. latest figures show that more than 13 million people have been mis—sold pp! and so far nearly £30 billion has been paid out in compensation. emma stranack, head of business and consumer communications at the fca joins us. good morning, welcome to the programme. do we really need reminding again there is money to be had from ppi claims? apparently we do. the fca has set a deadline for
making complaints and we know lots of people haven't looked into it yet. we know 75% of people have got tackling their to—do lists this bank holiday weekend so we've enlisted the support of mr motivator to motivate people to put ppi checking on their to—do list this weekend. tell us about the best way to do this to check. i know for myself personally that i receive so many text messages and cold calls, you think you're being scammed by companies. you don't respond. what's the best way to do it? the best way is to go to the sa website —— d f c a website and you can find out exactly how to check or complain for free online, or you can call our helpline. if you are due compensation what do you do then?
you complain directly to your bank. most banks have online checking tools and you can make your complaint online. then you wait a few weeks for them to respond and hopefully get the money you're entitled to. thank you. just a reminder, the deadline for making those claims is the 29th of august so it's one to keep an eye on when it comes to making sure you get the money if it is owed to you. there's much more on the website including whizz air securing their licence for after brexit. you're watching business live — our top story. draining the batteries and burning cash — electric car—maker tesla reports another record loss. but the founder elon musk is still optimistic the company will be profitable this year.
if they can get those mass market models made and sold. in the armed forces the saying goes "there is no bad weather, only bad clothing". but nowadays it's notjust the military that's out in all kinds of weather. the so called "outdoors industry" is booming, worth around $20 billion, and that covers the sale of everything from rain macs to ice picks. one of the companies trying to carve out it's own niche in this growing sector is keela. founded on the east coast of scotland, it is a manufacturer
of outdoor clothing. in 2017, it had a turnover of $9.5 million. among it's customers are emergency services including mountain rescue, police forces, coastguard, tactical forces and expedition teams, and military from more than 60 countries. sam fernando is director of the firm and is with us now. nice to see you. when we look at stuff like that, there is extreme sports, there's outdoor sports, such a booming market. when you put a figure on it you realise what big business it is. it's a growing slice you have of that. talk us through the story. our company was founded in the 1970s and we were an engineering company. we view is that engineering company. we view is that engineering background and put it into outdoor solutions, so very technical products. we developed the first machine that makes your
garments waterproof, we also developed the ultrasonic and laser machines which is a new industry which is about making garments without any stitches of fred. and that's where the water gets in. exactly, that's what makes it waterproof. we won a queen ‘s award for innovation for that product. we'll say won an award for a new clothing protection idea which gives you more protection out on the hills. the chief executive is your dad who is 74. you told me he would never retire and your two brothers work that the company as well. clearly you get on. are you all mountaineers? talk us through the family connection. theirs for directors in the company. it's very much a family company and we get on very well. we take christmases
together. but also people that work in the company as well, it's a fantastic team and they are part of the family as well. it's notjust about blood but creating that environment. you have a close-knit community when it comes to your supply chain. you've mentioned some of the machinery use you've invented. it's in scotland, it's in a factory in sri lanka where you make sure your across every part of the process. how important is that? we can control all aspects, it also gives us ability to do more innovation other brands can do. we are the only company in the world that has that vertical integration of manufacturing from machines, consumables and manufacturing of the garments as well. it's a tough market, there are so many brands. a lot that people will associate with the outdoors, such as north face.
how tough is it to have visibility in that market? it's very difficult. we don't have a huge amount of money to spend on marketing, we are low— key. to spend on marketing, we are low—key. we don't do big marketing adverts. but what we do is our products, good innovation, quality and a good price point. there's no middle man and never expensive marketing campaign which has given us marketing campaign which has given us the foundation and quite a lot of outdoor professionals use us. thank you very much indeed. in a moment we'll take a look through the business pages, but first here's a quick reminder of how to get in touch with us. stay up—to—date with all the day's business news on the business live page. there's insight and analysis from our team of editors from around the globe. get involved and the
business live web page. 0n twitter, and facebook. 0n business live web page. 0n twitter, and facebook. on tv and online. what you need to know, when you need to know. many of you have been in touch today and it's been great to get your comments about elon musk. lawrence is back to talk about a couple of interesting stories. this is about mid career women in london who are leaving the workforce. some figures which talks about the difference between the numbers of men and women in work in mid—career. 35-45. it is men and women in work in mid—career. 35—45. it is largely down to the cost of childcare which anybody who works in the uk knows is ridiculously expensive. we talk about this all the time, and my
earning enough to pay for childcare? there's a fine line in london. earning enough to pay for childcare? there's a fine line in londonlj think all over the country it's got very, very expensive. there's a dilemma for a lot of families, do i work or do i stay at home or do i do a flexiblejob? work or do i stay at home or do i do a flexible job? london work or do i stay at home or do i do a flexiblejob? london is performing incredibly badly. the figures are huge, 73% gap between men and women working. longer term, huge, 73% gap between men and women working. longerterm, the huge, 73% gap between men and women working. longer term, the uk needs to get more of those women back into the workforce. if a constant problem for the government about the cost of childcare. thank you. we try and squeeze so childcare. thank you. we try and squeeze so much in. a quick word on your tweets about elon musk, time is precious which is what he wants to convey to his followers. refreshing and rude says another viewer. thank you for your company today. hello. it's been a rather cold start
to the day with temperatures down into fairly low single figures last night. for some of us it's been a bright start if not fairly sunny. this was this morning in greater london. you can see the bright lights of london in the satellite imagery. further west, the cloud is streaming in from the atlantic. with that big a cloud towards the north and the west there could be some patchy rain and drizzle affecting western scotland and northern ireland, the far north—west of england. elsewhere bright skies with sunshine. the cloud will tend to increase during the afternoon. the cloud will be fairly thin. holes developing to give us sunshine from time to time. feeling warmer than it was yesterday, a sign of things to come. temperatures 13—14 in northern areas. 16—17 in the south—east. through the evening and overnight variable amounts of cloud take us
into friday morning. 0utbreaks variable amounts of cloud take us into friday morning. outbreaks of rain affecting the north—west and north—east of scotland. temperatures overnight down to about 7—10. 0n friday it starts relatively cloudy. there will be some breaks in the cloud to give some of us a fairly sunny start of the day. the cloud will be thin and will break in places to give some sunny spells towards england and wales. thicker cloud in the north but warmer still tomorrow. temperatures getting up into the high teens and low 20s. that's a sign of things to come into the bank holiday weekend. mostly dry and increasing amounts of sunshine. saturday morning might start off a bit misty and murky but there will be some sunshine across most areas. thicker cloud towards north—western areas with a weather front here. 12 degrees in the outer hebrides but elsewhere look at those temperatures in the low 20s. this is sunday again
for central and northern scotland and northern ireland. cloudy on sunday and elsewhere lengthy spells of sunshine. perhaps more cloud in northern england and into the afternoon. warmer still with temperatures mid to high teens, up to 24 degrees in the south—east of england. continuing that into bank holiday monday. for many of us dry with sunny spells and warm. temperatures potentially up to 25 degrees. goodbye. hello, it's 9am, i'm victoria derbyshire, welcome to the programme. a leading breast cancer charity tells this programme hundreds more extra nurses are needed to cope with the breast screening backlog after that nhs it computer error which may have shortened the lives of up to 270 people. we talk to a woman caught up in the