03/08/2017 BBC Business Live


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This is Business Live from BBC News with Ben Thompson and Sally Bundock.


Tesla shows us the road to the future.


The world's leading electric car maker cut its losses and pushes


into fifth gear with a big jump in sales.


Live from London, that's our top story on Thursday


Elon Musk's company says it's had more than half a million


orders for it's Model 3, but how long will it take for Tesla


Delivering a blow to Australian retailers?


Internet shopping giant Amazon says its going down under


to open its first warehouse in the country.


And as the Dow surged through 22,000 off the back


of those Apple earnings - attention today on the Bank


of England's rate decision and forecasts for growth.


We speak to the boss of Cirque du Soleil on how to walk the tightrope


of balancing finance, safety and magic tricks


And as Brazilian footballer Neymar looks set to become most expensive


footballer in history - moving to French club


Paris Saint Germain for a record breaking 262 million dollars -


we want to know what's your most expensive purchase?


Let us know, use the hashtag, BBC Biz Live.


A lot of suggestions coming into us already, including your university


education and your house, chances are it is one of those two. Let us


know, use the hashtag. Let's begin in the United States, with Tesla.


Tesla is the car company that's promising to change


Investors have been taking a huge gamble on the electric car maker


and it judging by its latest numbers that appears to be paying


off, the share price has risen even higher.


Here's why: In the three months to the end of June sales hit $2.8bn.


That's more than double the same time last year.


It's still losing money though - over $336 million in the same three


month period which is more than last year - but not as bas


And it's paying off - Tesla delivered nearly 26,000


vehicles in that time, 40% more than the same


And that number could soon rise even further because its taken more


than half a million orders for the Model 3.


It started delivering what's being described as its first mass


Tesla hopes the Model 3 will keep it at the top of the market


But two Chinese rivals are already in the top five -


Plus the German car giants are investing heavily


as they try to put the 'dieselgate' emissions scandal behind them.


But the Model 3's design is transforming the industry.


It has less than 7,000 parts, which compares to 30,000


That might sound like a lot. But it isn't much compared to the


traditional car. That makes it simpler to build -


and less likely to suffer Jeremy White, Product Editor


of WIRED is with me. Thank you for coming in. So, Ben is


talking through some of the statistics and numbers. These are


pretty good earning figures for Tesla, aren't they? Which is good to


deliver, considering how the share price has been going up and up over


the recent weeks and months? They are impressive figures and they show


the appetite for these vehicles, they are getting 1800 orders per day


for the new Model three. It is whether they will be able to deliver


those, they have had difficulty delivering on the previous models,


getting sales delivered. It is whether they do that, that is


interesting. Talk us through what could be bumps in the road. They are


more simple for the manufacturer but it is the supply chain, the plants


to build the cars, they do not have that at the moment. They are


building a battery factory in Nevada with Panasonic and they are trying


to compete with the traditional manufacturers, with the supply chain


which is already set up, it is going to be difficult. And it is true that


Elon Musk has cast a spell over Wall Street and the numbers help him, it


shows that he is delivering on his enormous promises but, in the


meantime, his rivals in the car industry are catching up very


quickly, and they are busy working on those similar vehicles, and there


is momentum behind this now. We have government policy coming into line,


we had the meeting in Berlin yesterday and announcements from the


UK Government. The appetite is that? Yes, and the regulations coming in


for 2019 require higher restrictions on emissions, that is why we had


an announcement from Volvo that they will be making electric only cars


from 2019. Car makers are making cars and government is trying to


push policy but when it comes to the nuts and bolts of it, or whether you


can charge what you want, and the batteries need to get better so they


do not take so long to recharge? That is right, the Model three has a


range of 500 kilometres. Jaguar are working on a car with a similar


range, as are Bentley. It's what you do when you run out of power after


that distance. The gamble is you will only use the car for less than


that per day and then come home and charge it up. What if you are on the


road and you do not have charge left? Battery technology is


relatively in its infancy in electric vehicles and it needs to


get much better to allay these fears and allow for fast charging. Thank


you for your time this morning, fascinating. So much more about


Tesla on our website, including if you dig deep and find the interview


with Elon Musk that Rory Kevin Jones did not so long ago.


Let's take a look at some of the other stories


The food delivery company Deliveroo is introducing


new safety measures to protect its riders from violence.


It follows acid attacks in London last month,


where the victims included riders delivering by bike or moped.


Among the measures are a new app feature that allows riders


to raise security concerns, plus a trial of helmet cameras.


Australia's Commonwealth Bank has been accused of massive


breaches of money-laundering and counter terrorism regulations.


The case against the country's biggest mortgage lender


is the biggest case of its kind in Australia and the first


Commonwealth Bank says it is reviewing the allegations


Toshiba says it's going ahead with the capital investment to build


a new memory chip production line without joint venture


partner Western Digital, after the two have failed to reach


Somewhat confusingly though, Western Digital has just said it


intends to invest in the new chip line along with Toshiba.


We will find out what is going on and let you know! You have that job,


OK? I am delegating! Amazon has announced it


will open its first retail logistics The online retailer says


that the 24,000 square metre "fulfilment centre" is "an integral


early step" in its effort to establish a retail


presence in Australia. That's management-speak if I have


ever heard it! Mariko Oi is in our Asia


Business Hub in Singapore. We heard the management-speak, what


is going on, a big change for Australia? Indeed. It seems that


Amazon is really investing heavily in Asia-Pacific, just last week we


told you that Amazon has launched its Prime Now service in Singapore


as part of the start of its aggressive expansion into Southeast


Asia and now the company has unveiled the location of its first


warehouse, in Melbourne, making sense due to its proximity to the


east coast were over 80% of the country's population lives. We still


do not know when the service is going to start but it is definitely


going to put a lot of pressure on traditional retailers whose shares


have been falling since the announcement was made. Absolutely,


thank you very much. Yes, Amazon's integral early step to establish a


retail presence in Australia. Asian shares were down on Thursday,


led by falls in South Korean tech shares, as investors locked


There was also some evidence of slowing activity


in China's service sector and weaker commodity prices.


On Wall Street though, the Dow Jones breaking


through the 22,000 barrier for the first time


I will get out of the way so we can talk about it better!


That was pumped up by those earnings from Apple we told


More earnings news in Europe for investors to digest -


but attention will be on the Bank of England - as it


A hike would be a big surprise - most assuming a rise


will come early next year, not this year.


And so Assuming rates remain on hold, the quarterly


inflation report - that we get a little


What does it make of Brexit, slowing growth, and rising inflation?


Don't pay too much attention to that, the FTSE 100 is actually down


a little bit this morning. More on that shortly -


but first Samira Hussain has the details about what's ahead


on Wall Street Today. Earnings continue on Thursday with


several more companies reporting, including Kraft Heinz, the changing


taste in consumers opting for more fresh and organic food will likely


have hurt the company in the last quarter. Also reporting earnings is


the health insurer Aetna, insurers will be looking for comments on the


company, with uncertainty. After the Senate failed to pass a health care


bill to dismantle Obamacare. Aetna previously. We will hear from the


dish network, they are struggling with the growing trend of cord


cutting where subscribers are dropping TV packages altogether for


cheaper online streaming services, such as Netflix.


Joining us is Jeremy Stretch, head of currency strategy


A familiar face to the programme, nice for you to be here. Do you want


to start? Let's begin with the Dow Jones. I said figures were


partly due to Apple but there are other factors? Yes, Apple was one of


them, but in terms of the Apple Store, people were bracing


themselves for slightly disappointing numbers as there was a


fear that tech savvy phone users were waiting for the next version of


the iPhone, that was not the case. Earnings are strong in a number of


industries, that is the underlying dynamic. And you could argue there


is a currency effect in some instances, as the US dollar has


continued to depreciate in recent weeks, as you translate foreign


earnings into US dollars, it enhances earnings numbers and boost


equity markets. And among market watchers there is a hot debate as to


what will happen next. Is there going to be a horrible correction or


will its tail off? Where are you in the big debate? It depends on what


policymakers do, and so... Are you sitting on the fence? The


valuations, if you look at them against his strikes, they look


stretched but we have seen a massive run, especially in US equities,


there should be some degree of correction but in that context it is


not necessarily unhealthy. Are you excited about Super Thursday?


Undoubtably, not that we are expecting a policy change but what


is most interesting is what the banks say about the growth, they


revised the forecast in February and were forced to take a little of that


in May, they may be forced to do more now, the first half of this


year has been rather disappointing and the consumer is facing


difficulties in terms of maintaining expenditure, so I think numbers will


be revised down which could impact how the markets consider monetary


policy outlets for this year and especially into 2018. We will be


watching closely! The reason I am looking at my phone... That is a bit


rude! We have been asking people for comments about Neymar... Oh, so it


is work? Jeremy is coming back in a moment. The Brazilian footballer is


moving to PSG for a record-breaking amount of money, we suspect.


A lot of the comments this morning. Will you share them or will you


tease us? Starbucks, there we go, I bought a $6 cup of coffee from


Starbucks, it didn't even taste good, it was the most expensive


purchase of my life. On my wish list is the Tesla Model three, says


Natasha. This is what you can spend your money on... A familiar theme...


Housing, cars and clothing. We will look through those later.


Still to come, we will find out how you balance the high wire act of


entertainment with demand for profit with the boss of Cirque du Soleil.


Stay tuned for that. You are with Business Live from BBC News.


High street fashion chain Next says sales fell by 7.4%


But sales at its Next Directory and online shopping


Theo Leggett is our business correspondent -


Next has had a torrid time, what was in these number is, talk us through


them. It is a mixed bunch, but full price sales, if you take into


account what is going on on the high Street, online and the catalogue


business were up 0.7%. Now, that doesn't sound too dramatic but it


was a lot better than the first quarter, which was pretty dire. At


11 and one third percent the share price. What is explaining that? Next


has said it still has a very large cash pile, still generating a lot of


cash and it intends to return a lot of it to shareholders, that is why


the share prices going up, that the fact that it was pretty mediocre, it


was a lot better than the first. Sales picked up in June and July.


Ten one says it wasn't down to any particular marketing genius, it was


the warm weather, remember that? It was summer. So the bits that are


doing well, we have mentioned the online side of the business, focus


through that. Next Directory was already doing well. In the second


quarter sales were up more than 11%. Overall, that is helping to massage


the entire business. The high-street business is down more than 7%. It is


what we have been seeing for quite a while, next is doing very poorly on


the high-street but doing rather well online. Thank you very much


indeed. Talking about this on the today


programme today on Radio 4, despite the rise in binge viewing, streaming


services, things like Netflix, and people say people are still -- Ofcom


said people are still watching traditional TV. Like Business Live!


I am sure it is Business Live, they just forgot to include us. All the


people watching -- older people watching more than younger people,


who I guess ten to watch it more on tablets. Full details on the


website. The top story today, shares in the


electric car company Tesla are pretty sharply after reporting a


doubling of sales and more than half a million orders of its model three


car. That has begun shipping right now. It has been pegged as the big


change for the electric car market. Now markets trading in Europe, the


Footsie down slightly, they are all edging lower just a little bit. Not


following on from the record-breaking night on Wall


Street, the Dow Jones closing down. Cirque du Soleil - or in english


the Circus of the Sun - it's one of the biggest theatrical


producers in the world. The company had its beginnings


in 1984 and now has almost 4,000 staff from more


than 50 countries. Known for its acrobatics,


the group is putting on 20 different And the Canadian


company is expanding, it's just bought the American


entertainment firm the Blue Man group,


and is looking to walk Sharanjit Leyl has been speaking


to Circue du Soleil's chief executive about the company's


expansion plans, and Now with the acquisition of blue man


group, we want to, so with the blue man group and the experience on time


square, Cirque will be looking at markets like London, Hamburg in


Germany, and all of the Asia, we still see a lot of growth, including


here, Singapore. When the private equity firm TPG first took over


sector to lay, -- Cirque du Soleil, there were lots of streamlining of


cost cuts, are those concerns still there? We have not seen any push


from TPG to do extreme cost saving. Obviously we managed saving, but it


hasn't changed the way we produce shows and we create shows. That is


what I told them from the get go. I said I am there to listen to all the


advice you can give me, from a business standpoint, but for


creation and production, you know, that's so important, please leave


our creators alone, and they just burst laughing, because as financial


people, they haven't had any ambition about the product itself.


And of course the Chinese company Folsom also has a stake. So have


they influenced your push into China? They are a great supporter of


us cracking the Chinese market, diving when we will look into three


years from now, and you will see the of Cirque in China. It will be


because of the support I got from them. Over the years though, Cirque


du Soleil has had its fair share of tragedy. You've heard three deaths,


including the death of the son of one of the founders. So what have


you done to improve safety? Obviously we are very sad of what


happened, but the reality is a lot of enquiries has been done after


those fatalities, and it was crystal clear that it was an accident.


Because we are recognised worldwide as having the best safety measure in


the world. And hopefully it will never happen again, but we are very


proud of our safety measures. Tell us a little of yourself, because you


have a really very different background. You started off as a


journalist, you were in television and now you are the Chief Executive


of the largest circus firm in the world. How did you get into it?


That's interesting, because I used to support guy in the early days of


Cirque du Soleil when I was in the PR business. And he was one of the


founders. Yes, then I moved to the TV business and started working with


guy again, and that is when the relationship was not between us, and


Monday he called me out of the blue and said you are going to join the


circus. And here I am running around the world for Cirque du Soleil. Did


you say yes immediately? No, for me, it was such a different challenge


than the TV business, I said let me think about it, and three weeks


later I was joining the circus. And it has changed your life ever since.


It did, it brought an amazing experience to travel around the


world, and to have the possibility to bring a Canadian company around


the world. And this is very, very rewarding. And the fact that you're


a Canadian brand, how do you use that as a potential selling point?


What is quite unique about Canada is that we are recognised worldwide as


a country that really bring a lot of people from around the world, and


everyone loves to come to our creative centre in Montreal. They


feel at home and hosted. If you were to come in our studio in Montreal,


you would have the feeling you are at the United Nations, not at Cirque


du Soleil, which is great, because we like this idea that everybody


feels at home when they come to Canada and they feel at home and


they come to Cirque du Soleil. Daniel Lamarre. Jeremy Ross back to


talk through some of the stories out there being discussed and there is


no doubt that this one about the footballer Neymar's possible


transfer fee, not confirmed, not sealed or signed by any means, but


quite phenomenal the same. This is where business and sport collide in


a very serious way because we're talking about enormous sons of


money. And also about geopolitics, because PSG, the owners of them are


the Qataris, and of course they are also trying to enhance their own


credibility internationally and they are suffering from a little bit of a


political blockade back home. And hosting the World Cup in 2022. They


say money talks, but some would argue this is like verbal diarrhoea,


it really is on another level and you wonder where it will end. We


have this discussion every year, whether the football profit news


comes out, Deloitte, with that on an annual basis. It just seems there is


no cap. The numbers continue to accelerate exponentially. In the UK,


we have seen new football rights, more TV cash coming into the game,


which invariably goes out of the game to agents and players. We as


viewers or supporters of course are one is forced to pay those prices in


order to facilitate these ever elevated salaries and transfer fees.


We asked the viewers what they might do with this kind of money. Chris


said, we asked what is your most expensive purses -- purchase, Chris


said it was his divorce. Alex says my degree. So I think it is houses


and education and maybe family matters. Someone on Twitter says on


returning from deployment in Afghanistan, I bought a Tag watch


for ?2000. That is an expensive watch. Let's talk about this other


story, which is interesting. FTSE 100 pay-outs is going down. Indeed.


What we have seen in the last ten or 15 years is that the earnings of


Chief Executive 's have risen stratospherically. We are now just


seeing a bit of a correction, partly due to the fact that shareholders


are becoming more vociferous and pushing back against... There have


been shareholder revolts. Indeed, and that is making businesses or


renumeration committee is a little bit wary of putting their heads


above the parapet and trying to give Chief Executive 's exceptionally


high pay packages for fear of investor revolts. It could be an


element of tokenism, but there was a realisation there had been a


dislocation between topics Vicky Gibbs and the rest of the workforce.


Thanks, nice to see you. -- between top executives.


Hello, good morning, a day of sunny spells and showers today, the


majority of those will be the north. They are making their way slowly


towards the East, twirling around an area of low pressure sitting


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