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First Move with Julia Chatterley
Turkish Currency Plunges after the Central Bank Boss is Fired; Elon Musk Denies His Cars can Spy on China; Chipmaker Renesas Fuels Supply Shortage Fears. Aired 9-10a ET
Aired March 22, 2021 - 09:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[09:00:18]
JULIA CHATTERLEY, CNN BUSINESS ANCHOR, FIRST MOVE: Live from New York, I'm Julia Chatterley. This is FIRST MOVE and here is your need to know.
Lira lurch. Turkish currency plunges after the Central Bank boss is fired.
Trust Tesla. Elon Musk denies his cars can spy on China.
And fire fears ablaze. Chipmaker, Renesas, fuels supply shortage fears.
It's Monday, let's make a move.
Welcome once again to FIRST MOVE and a jam-packed show for you as always, filled with the very latest on pandemic era trials and tribulations.
Good news though on AstraZeneca's COVID vaccine. The U.S. trial results indicate an efficacy rate of 79 percent overall, and this is key, 100
percent efficacy against severe disease and hospitalization; also vitally important, no mention of the safety concerns that triggered temporary halts
across the E.U. last week and that of course, crucial in rebuilding confidence around the world where this vaccine is going to be in use.
There's a less confident more cautious feel though to global stocks today. U.S. stocks investors taking the lead, I think, from bond market investors
and torn therefore about how much to worry about rising yields. For now, as you can see, they are coping. U.S. 10-year yields stable after eight weeks
of gains. We are below that 1.7 percent level while the S&P 500 remains close to record highs.
But of course, it's complicated. Former U.S. Treasury Secretary Larry Summers said this weekend that the U.S. faces the worst macroeconomic
policy in 40 years. A bold statement whether you agree or not.
Now lots of opportunity for Fed Chair Jay Powell to disagree this week. He speaks to Congress twice. In Europe, meanwhile, travel firms are
underperforming as U.K. officials warn a potential extension of the foreign travel ban might be in play. Germany could also be about to extend lockdown
measures, too.
And Japan is the underperformer when you take a look across the Asia session with the big car makers slipping after a fire at Japanese chipmaker
Renesas escalated fears of chip shortages. We've got all the details on that.
But as you can see, no shortage of news. Let's get to the drivers.
The British Prime Minister is urging E.U. leaders to not block exports of AstraZeneca vaccine supplies to the U.K. Production delays threatened to
slow the pace of vaccinations across the European Union ahead of a potential third wave of COVID-19.
Fred Pleitgen joins us now. Fred, how likely is it that the E.U. steps in here and says, look, we're going to take stringent measures to restrict
supplies?
FREDERIK PLEITGEN, CNN SENIOR INTERNATIONAL CORRESPONDENT: Hi there, Julia, I think it's becoming more and more likely. If you listen to the
tough talk that's especially coming from the head of the E.U. Commission, from Ursula von der Leyen, she seems to be repeating those threats more
often than I've had her do so or heard her do so in the past.
She had an interview with the Funke Mediengruppe here in Germany, leading into today where she said, look, the E.U. has the power to block any sort
of exports of vaccine made by AstraZeneca, and her clear message to AstraZeneca, she said, fulfill your contracts with the European Union
before exporting vaccine to anywhere else.
Now, of course, that is a threat against AstraZeneca, a very direct threat against AstraZeneca, of course, but you do see the United Kingdom, for its
part taking that threat also very seriously.
You just talked about Boris Johnson urging the E.U. not to take such measures. Apparently, Boris Johnson also once talked to several E.U.
leaders or leaders of E.U. countries in trying to convince them for the European Union to not do that, to not block any sort of exports.
Also, the Defense Minister of the United Kingdom also saying, listen, the world is watching. The E.U., of course, is a bloc that prides itself on
free trade, where free trade is very important to it. And so, certainly, blocking the export of vaccine does seem like something that runs counter
to a lot of the things that the European Union stands for.
It was quite interesting, because in her press conference last week, Ursula von der Leyen said there were over 300 times that vaccine exports were
asked for and there was only one time that it was blocked. It was a bunch of vaccine that was destined for Australia otherwise, it said that they've
allowed all these vaccine exports.
Now the European Union said look, we could get a lot tougher. It's not necessarily something they say they want to do. But certainly with the
situation here with vaccinations the way it is right now on the continent, it certainly seems like something that is becoming ever more likely --
Julia.
CHATTERLEY: And to your point, it flies in the face of everything they stand for one of the key pillars, not to take this kind of action over
trade. I mean, they'd be the first people to criticize someone else doing this.
The problem is, everyone is desperate and they also have to message to their citizens and we're expecting perhaps a tough message from the German
authorities once again that the risk that lockdowns are extended further -- Fred.
[09:05:16]
PLEITGEN: Extended further and further and tougher and that's because Europe and Germany of course, as well is right in the midst of that third
wave.
And if you look at the scarcity of vaccine here on the European continent in the European Union, I was just on the German official vaccination
dashboard, and only four percent of the population have gotten two doses so far. And of course, AstraZeneca, also saying that they're going to deliver
less to the European Union than they had originally said in in their contract. So, certainly, a dire situation here right now with cases on the
rise.
There's several things that we expect could happen when Angela Merkel meets the State Ministers here in Germany. One of the things could be a nighttime
curfew in Germany, that's certainly something that we haven't seen in that form before and then also expanded testing as well.
But also some of the school openings that have happened here in Germany, that could be taken back in places where there is a high incidence of the
novel coronavirus.
So, right now, European governments, the German government certainly not being any sort of exception there saying, they simply don't have enough
vaccine to stave off this third wave of coronavirus infections, and therefore, the only measure they have at hand right now is further
tightening of restrictions, further lockdowns -- Julia.
CHATTERLEY: Yes, tough. Fred Pleitgen, thank you so much for that update there. We will watch that press conference later this hour.
Now to Turkey where the Turkish lira is plunging against the U.S. dollar after President Erdogan fired the head of the country's Central Bank. This
comes, of course, just days after the Central Bank surprised the market by raising interest rates more than expected.
John Defterios joins us now. John, it is exactly what we discussed. I mean, a month ago, the President said look, we're going to try and stabilize the
lira. We're going to fight inflation.
The conventional wisdom for that, of course, is that you raise rates and the moment the Central Bank Governor does that, it seems, he gets fired.
JOHN DEFTERIOS, CNN BUSINESS EMERGING MARKETS EDITOR: Yes, that's the case, Julia. It is almost like President Erdogan cannot resist and not fire
a Central Banker. This is the third in two years, which is quite extraordinary.
And many, if you talk to anybody in the emerging markets, which I was working the phones today, they say that the President has got a bridge too
far this, this Bosphorus Bridge too far, if you will, because he is eroding the confidence in the currency and his recovery plan.
As you suggested, he said, I'll douse inflation. I'll give the Central Bank independence. And he's made a huge U-turn in doing so.
Let's take a look at the latest currency rate now. We've had some stability in the last two hours of trade, around 7.9 to the U.S. dollar. We went all
the way down to 8.48 overnight with this drop of 15 percent. The record low was back in November when they had a shift in the cabinet with his son-in-
law leaving as Finance Minister when it hit 8.58.
So the bottom line here is his unconventional approach that Erdogan always believes in that there's an interest rate lobby against Turkey. He likes to
keep interest rates low, keep the growth high, and he still thinks he can control inflation.
But the facts are very different, Julia. Inflation in the last month is running at 14 percent and they're trying to bring it below 10. It becomes a
political problem here if the average Turk and the business community that supported him for a dozen years plus thinks that he's got this wrong
strategy in place, and he won't give it up.
CHATTERLEY: What is the fallout from this, John? As you mentioned, I mean, four Central Bank governors in five years, risking losing the confidence
now if the markets when they were hoping that we were finally getting to grips with some of the instability.
You just mentioned there his son was Finance Minister for a couple of years. At what point do people turn and say, you know what, we've lost
faith in your handling. We can throw in the pandemic response here, too.
DEFTERIOS: Yes, and there's a couple of different strategies being discussed here. Julia, he is not going to use interest rates, as you well
know. And you don't have deep Forex Reserves to buy back your currency.
They have about $50 billion in cash according to the Central Bank and another $50 billion in gold. You get desperate right? So we've had talk in
Turkey, and a lot of the sources I've been speaking to that the President is even suggesting that jewelers -- gold jewelers -- deposit gold into the
Central Bank to build up their reserves. That's how bad the situation has gotten.
And to your point here, there's even discussions about capital controls as the only tool left if that's the case, and go back to that son-in-law,
Albayrak, he was the son-in-law and the Finance Minister for two years, right, lost a lot of credibility when he made that move here. There's even
discussions bringing him back into the Cabinet.
And between 2008 and 2019, two very credible representatives as Deputy Prime Ministers managing the economy respected in London and on Wall Street
and global markets, they are gone. And now you look and say okay, what's next? And his Central Bank Chief now is a party parliamentarian from the AK
Party, Julia and he follows the same line as President Erdogan and this has been going on -- off and on for the last two years, and still that strategy
doesn't work.
So many are starting to say, hey, what's going on? And does it spill over to other markets? We're not seeing that just yet, though -- Julia.
[09:10:13]
CHATTERLEY: Yes, time for a new strategy. John Defterios, thank you so much for that.
All right, the next driver is literally being taken off the road. China's military banning Tesla cars from its complexes over concerns their cameras
could be used for spying, that according to reports.
Clare Sebastian has more on this. Clare, great to have you with us.
Elon Musk, Tesla's boss, coming forward and saying, there is no way our cars will be used to spy because it would drive Tesla literally out of
China. A stringent response on these accusations.
CLARE SEBASTIAN, CNN BUSINESS CORRESPONDENT: Yes, stringent and fast, Julia. He was speaking to a Chinese web conference on Saturday, the day
after these reports surfaced appealing essentially to sort of capitalist logic saying, why on Earth would we want to upset our business in such a
key market?
He said this is a very strong incentive for us to be confidential with any information. He said, if we use cars for spying in China, we will get shut
down.
And I think, Julia, in an acknowledgement that really tech and in particular data is now sort of a frontier when it comes to national
security. He compared this to TikTok, the U.S. government obviously trying to crack down on TikTok last year.
He said that, you know, if the United States wanted to shut down TikTok, luckily, it did not happen. He said lessons should be learned from that. So
he is trying to sort of set Tesla apart from this, but also acknowledging that this could be potentially a major issue for him in this critical
market.
I should say that CNN hasn't independently verified these reports that either Tesla cars are being banned from military compounds or that the
Chinese are trying to restrict their use by government agencies and state- owned companies.
The Foreign Affairs Ministry has not responded to requests for comment, but I think the fact that Elon Musk has come out and addressed this suggests
there is some credibility behind this.
And again, very critical to watch going forward because China is such a key market for Tesla, and because of the state of U.S.-China relations right
now -- Julia.
CHATTERLEY: I was about to say, actually, he's managed to navigate what's been an administration, four years full of tensions over technology between
the United States and China. And yet he managed to build the Giga Factory there. He is distributing Teslas in China.
This could be a huge, huge problem for Tesla, if it can't be resolved.
SEBASTIAN: Right, I think, I mean, look at the stock price since they started delivering cars in China, which is the end of 2019, it's up some
700 percent, even with the 25 percent drop from its recent record high. That really is what has been powering earnings and the stock going forward,
not only the fact that they have now added sort of quarter million a year capacity with the Chinese Giga factory.
But also that Elon Musk has called this a template for future growth. They are learning lessons from what they've done in China. Analysts, Julia, at
Wedbush say that they are looking, they are on track to be producing 40 percent of all units sold per year in China.
And Tesla, as you say, has been something of an outlier in terms of the access they got in China. They were the first car company to be allowed to
build a factory without a local partner. So they are hugely invested in that market and critical going forward.
This of course, we shouldn't forget the biggest electric vehicle market in the world. They can't afford to let this spiral into a bigger problem.
CHATTERLEY: Yes, the quote is really clear, if Tesla used cars to spy in China or anywhere, we will get shut down. The end.
Watch this space. Clare Sebastian, thank you so much for that.
To Japan now, a fire at an important microchip factory stoking concerns over the ongoing global semiconductor shortage.
Selina Wang joins us live from Tokyo. Selina, just talk to us about what happened with this fire and do you have any sense yet of how long
production of chips might be impacted?
SELINA WANG, CNN CORRESPONDENT: Well, Julia, for some context here, Renesas is one of the world's largest chip makers for the auto industry.
This fire broke out on Friday at the plant in Naka City, which is north of Tokyo. The company said that there have been no casualties, but there is
equipment damage that was reported.
Now, the CEO said they aim to restart production within a month, but that this could have a major impact on the global chip industry for automakers.
You already have car makers like Toyota and Nissan and Honda scrambling to assess the impact that this is going to have on their production. And
really, this just couldn't come at a worse time for car makers. They are already struggling because of this global chip making crunch.
These car makers, many of them, have already had to scale back production because of these chip making shortages, these chip shortages, which really
stem from two issues. One is the rebound in car demand that has come back much faster than expected, compounded by the increased demand of consumer
electronics during the lockdown.
So really an exacerbation of an already very severe problem -- Julia.
CHATTERLEY: It is, and do we know how reliant they are on Renesas because as you quite rightly mentioned, this would be a problem in of itself, but
it wouldn't be such a huge problem if there weren't a global shortage of chips at this moment.
So even if they are diversified, the problem is, can some of these car makers like Toyota and Nissan get these chips from elsewhere?
[09:15:10]
WANG: That's exactly right, and it's not just an issue for these Japan car makers. It is also a global problem.
Japanese bank, Nomura estimates that about a quarter of the capacity coming out of that production plant that was damaged by the fire is for these
global automakers, and these chips are just so incredibly important for cars.
And the smarter that cars get, the more chips that they need. These chips that companies like Renesas make are used for monitoring entertainment
systems, for monitoring engine performance, for automatic windows, for sensors in parking.
And when it comes to Renesas in particular, they have had experience dealing with supply chain disruptions in the past. In fact, just last
month, there was an earthquake here in Japan that led to a disruption for several days for its plants. And back in 2011, they had several months of
production getting halted because of the Fukushima earthquake tsunami disaster that actually led Renesas to make changes to diversify its supply.
But in this particular instance, the CEO said they can't simply just shift production to a different facility because the entire industry is dealing
with the lack of spare capacity.
So really bad timing here all around -- Julia.
CHATTERLEY: Yes, terrible timing for the industry. Selina Wang, thank you so much for that.
All right, let me bring you up to speed now with some of the other stories making headlines around the world. The European Union set to announce
sanctions on several officials linked to last month's coup in Myanmar.
The U.S. Foreign Policy Chief said measures are being imposed on 11 individuals involved in the coup and the brutal repression of
demonstrators.
Meanwhile, the BBC says one of its journalists in Myanmar has been released after being detained by unidentified men on Friday.
A Chinese Court says it will hand down a ruling against a detained Canadian man, quote, "at a later date." Michael Kovrig went on trial behind closed
doors earlier today. He is one of two Canadians charged with espionage.
International diplomats were denied access to the trial. The Court says the proceedings were closed because the case involves quote, "state secrets."
More than 18,000 people have been evacuated from their homes as intense flooding hits Australia's most populous state. Roads and houses in New
South Wales are completely submerged after several days of heavy rain. Many of the homes are in areas ravaged by wildfires over the last two years.
All right, still to come here on FIRST MOVE, one in four COVID-19 deaths worldwide now occur in Brazil. ICUs are at capacity. Hospitals say they
only have enough supplies for a few more days.
We speak to the Governor of Sao Paulo to understand. Stay with us.
(COMMERCIAL BREAK)
[09:20:48]
CHATTERLEY: Welcome back to you FIRST MOVE live from New York where your stocks are firm in premarket as we begin the last full trading week of the
first quarter of the year.
Tech stocks set for the biggest gains as bond yields steady, too. You can see three quarters of a percent there, gains for the NASDAQ premarket.
Banking majors though looking softer building on Friday's losses.
Banks under pressure after the Federal Reserve pulled pandemic era support that the broader industry was hoping to see extended. We've also seen some
M&A action this morning. Two shares of the Kansas City Southern Railroad are on track for a rally. It has accepted a $25 billion takeover offer from
the Canadian Pacific Railway, a deal that would create a rail giant connecting the U.S., Canada and Mexico, a vote of confidence it seems in
the future of North American trade.
Okay to Brazil now where the coronavirus crisis is getting worse. A CNN analysis found that nearly a quarter of global COVID-19 deaths over the
past two weeks occurred in Brazil.
Intensive care units across the country are nearing capacity as cases of a highly contagious variant surge.
Matt Rivers joins us now. Matt, it's a perfect storm, too, with vaccine shortages in play as well. Just talk us through what you're seeing.
MATT RIVERS, CNN INTERNATIONAL CORRESPONDENT: I mean, it's just a dire situation right now, Julia. The latest CNN analysis from yesterday evening
shows that nearly every single state here in Brazil is seeing ICU capacities at or above 80 percent, 14 in 26 states here in Brazil have ICU
capacities of 90 percent or higher.
That means that the healthcare systems in those states, if they haven't collapsed already, they are at imminent risk of doing so.
Meanwhile, we're hearing about critical medicine shortages, medicines critical to intubating patients. The situation is really bad right now,
Julia, and what we're seeing is people dying here in Brazil, not only the elderly, but the young as well.
(BEGIN VIDEOTAPE)
RIVERS (voice over): There's a sense of desperation outside this Rio de Janeiro clinic. "She didn't get one," says Sylvia Silva Santos walking out.
"My 77-year-old mom can't get a vaccine." One of many that showed up that day waiting for vaccines that don't exist.
This woman says, "This is a disgrace. People waiting all day and night. Who knows if there will be a vaccine tomorrow?"
Brazil's COVID-19 situation has never been worse. Daily case and death records are the norm. ICUs nationwide are full and health systems are
failing us.
And despite health officials saying the program has been a success, vaccine deliveries are well behind schedule, months away from making a big impact,
experts say. No supply means no shots today back at the clinic.
RIVERS (on camera): So all these 70-plus-year-olds behind me have been told there are no more vaccines left in this clinic. The weather app says
it's feels like it's about 100 degrees outside and yet they're not willing to leave because they're scared that if they do leave and some vaccines
show up, they won't be here to get them.
RIVERS (voice over): They wait because they're scared of a disease that preys on the elderly. But in Brazil lately, it's not just the old who are
dying.
Maria de Pena Da Silva Siqueira (ph) says, "She wasn't just a daughter, she was a friend. She was everything to me." Her daughter, Graziani was only 28
when she died last year of COVID. Her four-year old son lives with grandma now. Their family forever missing a member.
She says, "They called me that morning and said she was dead and I went into shock. The virus didn't let us say goodbye."
For the last two months, multiple doctors across Brazil have told us they've seen more young people dying of COVID than before. In Brazil's
largest state of Sao Paulo, officials say 60 percent of ICU patients are now between 30 and 50, something Rio de Janeiro, Dr. Pedro Archer is
seeing, too.
He says, "We have patients now in their 30s, in their 20s, severe intubated patients I think maybe the virus has mutated and become a new strain."
There are new COVID variants here, but experts say there's no proof yet they are more lethal for the young. To explain it, epidemiologists point
more to scenes like this.
[09:25:16]
RIVERS: Social gatherings, this one, a party from this month ramped up during the New Year and Carnival holidays, younger people simply exposed
more.
In another video given to CNN this weekend, dozens can be seen streaming out of a party broken up by police and that's just the illegal stuff.
In Rio, bars and restaurants can be open until nine, many taking full advantage.
RIVERS (on camera): It is crowded out here and it just doesn't feel like you might expect given that Brazil keeps setting new records for cases and
deaths.
RIVERS (voice over): Where it does feel like that is this cemetery in Rio de Janeiro, both young and old end up here.
Today, it's a funeral for a 52-year-old COVID victim. There's a lot of services lined up this afternoon. So the family only gets 15 minutes to
mourn.
(END VIDEOTAPE)
RIVERS (on camera): And Julia, we know that the ultimate way out of this situation for Brazil will of course be vaccines. But the program here
remains painfully slow.
We did get some good news within the last week. We know that Brazil has signed agreements to receive up to 138 million doses of the Pfizer and
Johnson & Johnson vaccines in total.
But what critics are saying is why were those agreements just signed now? Why were they not signed much earlier? They're signed at a time when so
many ICUs across this country are basically collapsing. Had those agreements been signed earlier, those doses would already be in the
country.
For example, the Health Ministry actually turned down an opportunity to secure up to 70 million doses of the Pfizer vaccine going all the way to
last August. They still defend that decision because they say there were contractual issues there.
But the people here in Brazil, ordinary Brazilians would look at that decision and go wait, you could have had vaccines last year and you waited
until now to sign an agreement with that same company? It is incredulous or as many people are incredulous when they look at that, Julia, but it just
highlights the desperate situation right now facing this country.
CHATTERLEY: Yes, it's heartbreaking and many of the trials, of course carried out there as well. So access to these drugs should have come
sooner.
Matt Rivers, thank you so much for that.
All right, stay with FIRST MOVE because we're going to continue the conversation with the Governor of Brazil's most populous and wealthiest
state, Sao Paulo, that's next. Stay with us.
(COMMERCIAL BREAK)
[09:30:41]
CHATTERLEY: Welcome back to FIRST MOVE. U.S. stocks are up and running this Monday and tech is well and truly in the lead after last week's losses
of over half a percent. We are up more than that if we can hold those gains. Tesla helping rev up the S&P and the NASDAQ.
Influential ETF manager, Cathie Wood of ARK Innovation fame, raising her Tesla price target to an astounding $3,000.00 a share by 2025 driven by
optimism over self-driving vehicles. Remember, ARK would say this is not a car company, this is a tech company. Tesla still lower in 2021, but up over
660 percent over the past year.
Now AstraZeneca shares also higher in U.K. trade, too. Late stage U.S. trial data showing a strong efficacy rate for its COVID vaccine and no
mention of the blood clotting concerns that triggered a temporary halt to E.U. vaccinations in recent days.
Okay, we return now to Brazil in the State of Sao Paulo where schools, shops and businesses have been shut since early March. Its hospitals are on
the brink of collapse. Authorities predict they will run out of intubation drugs within a week.
As the crisis spirals out of control, local officials are demanding more action from the Federal government. Last week, two mayors from across the
country sent a letter to the President demanding immediate action to provide supplies and medicines.
And joining us now is Joao Doria. He is the Governor of Sao Paulo. Governor, fantastic to have you on the show. Thank you for joining us at
such a busy time.
I want to start by asking you about the healthcare system. It sounds incredibly desperate, how close to collapse are you?
JOAO DORIA, GOVERNOR OF SAO PAULO, BRAZIL: Julia, thanks for having me. We are in one of those tragic moments in history when millions of people pay a
high price for having an unprepared and psychopathic leader in charge of a nation.
Since the beginning of the pandemic in Brazil, 295,000 Brazilians have died. Much of these deaths could have been prevented if President Jair
Bolsonaro had acted with the responsibility that the position gives him.
Brazil is a wonderful country, Julia. We've had the hard working people who struggle to live. We have the best destination network in the world, which
covers the entire territory despite the country's continental dimensions. Our reality today could be much less sad.
But the President Bolsonaro turned his back on life by making a series of unbelievable mistakes. The biggest one was having it tied into a political
dispute with the governors who are trying to protect the population.
CHATTERLEY: I understand, Governor.
DORIA: First, he said, it was just a little cold, Julia, then he promoted gatherings and made fun of the use of masks setting a terrible example for
the population in Brazil.
CHATTERLEY: I understand, Governor. Just talk to me about the reality as you mentioned. What is the reality in your healthcare system at this
moment? What do we need to understand?
DORIA: Julia, we are in the collapse at this moment. I face at this moment the biggest challenge of my life as Governor of the largest state of the
country, Sao Paulo. I had to restructure the health system in record time and look for solutions to mitigate the economic crisis that hit the
country.
The situation is in a collapse right now in Brazil. We have already tripled the number of ICU beds and this month, we will open 12 field hospitals in
the State of Sao Paulo.
In the face of difficulties, I didn't see it with my arms crossed.
In Sao Paulo, as you know, it is the biggest state in Brazil. We mobilized society, obtained almost two billion reals, more than $500 million in
donations from the private sector.
But I have to ask you, Julia, what President Bolsonaro is doing for us in Brazil. Nothing at this moment. Nothing.
[09:35:08]
DORIA: We are isolated in the word trying -- trying to help people to get life.
CHATTERLEY: You've also battled over restrictions and lockdown measures. I know you've announced varying degrees of phases of restrictions. Governor,
is total lockdown at this point, really the answer for your state? Never mind the rest of the country -- is this something that you need to consider
and are considering?
DORIA: We are working hard on that. We created a plan called Sao Paulo Plan, Julia, here in Sao Paulo State, which assesses various circumstances
to ensure that we can gradually open up trade and other sectors of the economy.
But it will also require going back if we have indications that could put people's lives at risk and we are doing this right now. We are in the
emergency phase.
Brazil needs peace. Brazil needs vaccines. Brazil needs leadership. This is a terrible crisis that we are living at this moment down here.
CHATTERLEY: Governor, are more restrictions in your state necessary -- further restrictions? And how long do you anticipate them continuing?
DORIA: Well, we have restrictions to the end of this month and we are studying if we need to go away with these restrictions right now in Sao
Paulo State. We have a committee with 21 doctors supporting all decisions of the government of Sao Paulo.
We have today, in this afternoon, right now it is morning time here in Sao Paulo. This afternoon, we have a new meeting with these doctors to decide
what we will do during the next week here in Sao Paulo, Brazil.
CHATTERLEY: You also criticized President Bolsonaro for his behavior whether it's with regards masks or lockdowns. Do you think in the current
situation, a full lockdown in Brazil is required? And do you believe that Brazilians will accept it? Do Brazilians accept the importance of safety
measures, lockdown measures for the good of protecting lives and protecting the healthcare system?
DORIA: Julia, unfortunately, we have 30 percent of the Brazilian population supporting President Bolsonaro. That's incredible. But that's,
that's really true. But we have 70 percent of the Brazilian population going on the same way of the Governor's with restrictions, with the
obligation to use masks and to provide support vaccines, and to promote isolation in our territories.
And we'll still go on this way, but against President Bolsonaro. That's an incredible situation, Julia. We have to fight against two virus here in
Brazil, the coronavirus and the Bolsonaro virus.
CHATTERLEY: There's also a lack of vaccine supplies. What are you telling the people in your state about when they may receive a vaccine because
we've shown pictures of people queuing up hoping to get a vaccine and then being disappointed at the end of the day? When do you think you can get
your people vaccinated, Governor?
DORIA: A good point, Julia. Today, the vaccine that we have in Brazil, 90 percent of the vaccines that we have, is produced by an institute, Butantan
down here in Sao Paulo, which is linked to the government of Sao. It is basically the only one available at this moment.
By the end of August, we will have made a hundred million vaccines available across the country. This gives us pride, but it's still not
enough. We need more vaccines.
The Butantan version is only being produced here, and thanks to the partnership with the Chinese laboratory, Sinovac signed by the government
of Sao Paulo last year to exchange technology in the development of vaccines.
But the Brazilian government just now in March, Julia started to buy vaccines. That's incredible. We started -- the Sao Paulo State started to
do that in April of last year and the Brazilian government start now in March. That's terrible.
CHATTERLEY: President Bolsonaro said on Sunday, Governor, that only God could remove him from his position before the end of his term. As you just
said 30 percent of Brazilians still support him, but 70 percent don't.
Are lawmakers ready? Are you ready to take the steps required to perhaps remove President Bolsonaro if he doesn't change tack and take a different
strategy for the health of Brazil, for the health of the people?
[09:40:21]
DORIA: Well, Julia, it is a very difficult moment, as you said. We have Bolsonaro as a President until the end of '22 and we have to support the
biggest crisis, a health crisis in our history at this moment here in Brazil fighting against someone who is against the health, against the
people in Brazil, and just governors and mayors are supporting the people.
Brazil needs peace right now to combat the terrible crisis. Leaders must be united to save lives. That's the point.
CHATTERLEY: Should the President be removed, Governor?
DORIA: This is -- Julia, this is a Congress decision, not from governors' decision. That's the decision of the Congress of Brazil.
CHATTERLEY: I agree. Should the Congress be discussing this?
DORIA: Well, right now, they are not putting this on the agenda of the Congress, unfortunately.
CHATTERLEY: Governor, what's your message to the people of Brazil? To those people that are still going out, that are not wearing masks, that are
being caught at parties? We all understand that people don't want to be restricted. What's your message to those people?
DORIA: Please keep hope. Use masks. Follow the sanitary protocols. Be away from the streets, from parks and stay at home. Use masks and pray, that's
the point, and pray for their life.
CHATTERLEY: Yes. Stay safe, sir. We wish you well and our hearts are with all those in Brazil that are suffering.
The Governor of Sao Paulo there, Joao Doria.
All right, after the break, a billion dollar valuation. How did Skydio takeoff? The CEO of the tech unicorn joins us next.
(COMMERCIAL BREAK)
[09:45:34]
CHATTERLEY: Welcome back to FIRST MOVE. We've all been wowed by a breathtaking drone video, but often, a drone is reliant on the skills of
the human operator.
For my next guest, it's all about drones that fly themselves. The tech unicorn, Skydio. Sky is the limit when it comes to its customer base from
skateboarders to firefighters and even bridge inspectors.
No surprise that there's plenty of investment, too, but what might surprise you among the blue chips is the NBA star Kevin Durant, I kid you not. Adam
Bry is the CEO and co-founder of Skydio. He's also on the Drone Advisory Committee of the U.S. Federal Aviation Administration.
Adam, fantastic to have you on the show. Just explain what it is about your technology that makes your drones unique.
ADAM BRY, CEO AND CO-FOUNDER, SKYDIO: So we started the company because we believe that drones have enormous potential across a lot of different
industries and applications. But being able to trust the drone to fly itself is really a key foundational technology to unlock the most useful,
interesting applications.
So what makes our drones special is that they can fly themselves. So they have cameras that see in every direction, they have a really powerful
computer and they're running our software, which gives them the ability to map and understand the world around them, predict into the future and make
intelligent decisions.
CHATTERLEY: I mean, you are a pilot, and part of the game plan here for your drones I read was that you wanted to build them with capabilities that
were better than the best pilots in the world. They were a better replacement for pilots being able to do these jobs.
And when we gave a sense of some of the range of where your drones are being used, but it's from emergency responders, buildings -- just give us a
sense of where these drones are being used currently around the world today and how.
BRY: So I as you mentioned, I mean, I grew up flying radio controlled airplanes, which were kind of the predecessor to drones. And a big part of
the motivation for Skydio was trying to do things beyond the capabilities of the best pilots in the world. But the key really, I think, is making
these things more scalable.
So it's less about replacing the pilot and it is more about making it so that a single operator can deploy one or five, or in the future many, many
drones and have them perform a useful task.
So we have customers who are using our drones to capture amazing video, things essentially like a film crew that fits in your backpack.
We have customers that are inspecting critical infrastructure, so bridges, cell towers, buildings that are under construction. We have first responder
agencies that are using our drones to get situational awareness in critical dangerous situations. They don't have to put a person in harm's way.
And the most exciting thing for me is, I think we're still just scratching the surface of what's possible. The industry is really in its infancy and I
think a lot of the most exciting stuff is still to come.
CHATTERLEY: Fast forward five years, what's possible, Adam?
BRY: So our goal is really to make drones become like basic infrastructure, tools that are always available that you don't have to
actually physically touch it or interact with it in order to have it do something useful for you, and that's kind of what we're incrementally
building towards.
So having them be able to fly themselves is kind of the starting point, but then connecting them to the internet, being able to dispatch them through
the internet, control them through the Cloud is the next step and I think that's really what we're going to see happen for the next five years in the
industry.
CHATTERLEY: Talk to me about the data as well, because I know you have contracts with the Department of Defense as well. How much data capacity do
these drones have to collect? And how are you protecting the data that's collected?
BRY: So the core capability of our system is essentially a flying camera. So you can think of it as an image sensor that you can put anywhere you
want in three dimensional space. And as you can see, with our customer base, that's a very general capability that applies across a number of
different industries and applications.
And as you say, the key output from that is the data and the security and integrity of the data is absolutely critical. Part of what's happened I
think over the last few years is people have realized that these things that started off looking like consumer toys are actually incredibly
powerful tools and that's something that we take very seriously as a company.
So the starting point for us is that the data coming back to our servers is purely on an opt-in basis for our customers. So by default, we don't get
the data back and we only get it back if the customer explicitly wants us to. And once we do, we take the security of that very seriously.
CHATTERLEY: There has also been sort of an issue with some Silicon Valley employees seeing their companies working for government contracts. I mean,
a great example, I guess, Customs and Border Patrol.
Adam, how do you feel about the use of these drones, particularly in these government contracts and the stance that you take versus some of those in
Silicon Valley that say, look, we're simply not willing to work with the government and on government contracts because they're lucrative, but
there's a cost.
[09:50:13]
BRY: So, I think it's a really important discussion. You know, my perspective and our perspective as a company is that these are, you know,
law enforcement, Customs and Border Patrol, the Military, I mean, these are all institutions that we have a stake in, and ultimately we all benefit
from and the work that they do is difficult.
The stakes are high. Nobody is ever going to get it perfect. And there are tragic examples when things go wrong, and I think that the -- you know,
that sort of raises the stakes for technology that engage, but ultimately, I think it's really important work to be doing, and it's a discussion that,
you know, we think should be open to the public.
So we've published a set of principles as a company for how we think about engaging with government agencies. We've published a specific set of
principles for public safety and law enforcement about, you know, what we think it takes to set up a successful program.
And, you know, in public safety in particular, I think the most successful drone programs are the ones that have the most community support, and we
see a lot of our customers, doing a lot of work to engage the community, talk to them about the work that they're doing with drones, talk to them
about the benefits and taking real steps to enforce, you know, make sure that their drone programs are respecting civil liberties, and providing a
net benefit to their communities.
CHATTERLEY: Which makes sense to me. Talk to me about cost. And also, I read that D.J.I., the Chinese company has around 70 to 80 percent market
share in the United States.
I mean, that's got to be at the core of the current battles between China and the United States, too. So if anything were to happen to restrict them,
how quickly could you scale up? And what kind of market share do you think you could take in the coming years in the United States alone, never mind
anywhere else.
BRY: So the real dynamic that I think is happening in the market is this transition from manual to autonomous and D.J.I. has been normally
successful building manually flown drones, so that I think, have really set the foundation for the industry and in a lot of cases proven the value that
drones can provide.
So we're at this really interesting point where I think a lot of people, a lot of customers have kind of used manually flown drones to explore what's
possible, they've seen the value, but now they're looking for something that's easier and faster to deploy, and ultimately, more scalable, and more
powerful and that's really what we're focused on as a company.
And, you know, I think this is an opportunity. We've seen this play out before in other industries. So one of the analogies we use is the
transition from kind of the command prompt in the early days of the PC industry where you had to be an expert programmer to use a computer to the
graphical user interface with Mac and Windows that really opened up this whole software defined world.
So you know, this is an opportunity where we've seen U.S. technology companies take the lead before, and certainly that's our goal as a company.
CHATTERLEY: Yes, something that doesn't have to be operated manually, you can get it to do the work itself.
Adam, great to have you on the show. Keep in touch, please. And we'll look track your progress.
The CEO and the co-founder of Skydio, great to chat with you today. Thank you.
All right, you're watching FIRST MOVE, more to come.
(COMMERCIAL BREAK)
[09:55:20]
CHATTERLEY: Welcome back to FIRST MOVE with a look at the early action on Wall Street. Tech bouncing back as bond yields ease, as you can see. As a
result, financials and energy stocks seeing the most pressure.
What about the crypto space? Bitcoin, a touch softer, but we're still sitting near that record $60,000.00 per Bitcoin level hit earlier this
month. What about Ethereum, too. Now this is the blockchain that supports the non-fungible token or NFT craze that we've been covering here on FIRST
MOVE. That's a little touch softer. We can show you that as well.
"Time" Magazine -- "Time" jumping on the NFT bandwagon announcing today that it will auction off three NFTs, two of those, its most notable covers
plus an especially designed cover: "Is Fiat Dead?" As in the fiat government issued currency. The auction concludes later this week.
Some big questions being asked. The cryptos are going to love that.
That's it for the show. Stay safe. "Connect the World" with Becky Anderson is next. We'll see you tomorrow.
(COMMERCIAL BREAK)
[10:00:00]
END
