manus: good morning from bloomberg's new european headquarters in london. nejra: these are today's top stories. manus: gary cohen is set to some incorporates to the white house. global stocks rally over policy ease. nejra: italy's president faces critical talks before nominating the next prime minister. could the country be on course for fresh elections? the lack of shell assets is not a hurdle to making profits. >> i think this is

you can be very efficient. we are a popular company. ♪ manus: very well -- warm welcome. higher oil prices are favorable for our gulf countries. this is the breaking news in the gulf countries, to build more defense products. $982 million.n at that beats estimates. thales has a target for this year. 1.6 billion euros. cfo, the last time we heard from him, said defense budgets

are going up. they pulled together the $5.6 billion bid. that was back in december. the targets up to 1.6 billion. no adjusted profit, 982 million. they say higher oil prices will be favorable for the gulf customers. the ambition for the gulf is something that will drive, along with trump in terms of these defense companies. nejra: you're talking higher oil prices, let's talk about higher chocolate rices. -- they havef the hedging, higher prices have a lag. let me show you numbers that came in a few minutes ago. was 597.7 million swiss francs. , evermeeting the estimate slight miss there.

fully give dividend share coming in at 930 swiss francs. 12,buyback is from march 2018 to july 31, 2019. let's talk long-term sales organic product. lindt confirming that today. , up, and away. who cares about trade tariffs. with the white house, in terms of gary cohen, along with what they want from the president. paul does not want terrorists. you've got ryan urging trump to reconsider the tariffs. you got gary cohen trying to head off the canned producers. -- cam producers.

bring them into the white house later this week. the threat of trade wars is a political sideshow. message from the governor was very clear, the aussie dollar remains within a range that has been over the past two years. aussie dollar comes back a little bit. dollar korean won just strengthening a little bit of a risk on a move in the equity markets. that curried into the equity markets. they are pricing in 25 basis points. we have that nice complexion of risk and relief. will it was sustain, will it maintain? nejra: we might have a flat open in the u.s. the gains of over 1% might not hold. if you're looking at the direction where to go next on

the s&p 500, you can look at the momentum charts, they look bullish. the strength index, you can look at etf flows. looking at volatility and the vix against the s&p 500. volatility has been coming down over the last few days, trading down to read this chart is showing, and what credit suisse has pointed out, if you look 2014, everycally to time the vix went above 25, you saw on average gain of 6.9% three months after the vix rose above 25. you can go into this chart yourself. and see what we have since the vix went above 25. we have a little further to go, if this chart is correct. raft of guests. we are live at the auto show in geneva.

an interview with steven armstrong who joins us shortly. 6:30 a.m., we have itv berlin. we will have a conversation with the ceo keith barr. ceo.t the jag land rover let's get the juliette saly. donald trumpg time associate sam numbered says he does not plan to cooperate with the subpoena from robert mueller. press hasated reported that numbered in a reversal says he will cooperate -- the associate appraiser has the associated press has reported that nunberg associate --

a man hospitalized in a critically ill condition is a russian convicted in his home country of spying for the u.k. according to a person familiar granted case, he was refuge in britain in 2010 after a spy swap with russia. he and a woman in her 30's were found unconscious in a bench and a shopping mall on sunday afternoon after exposure to an unknown substance. doctors and psychologists are examining what made the pair so ill. italy's political future hangs in the balance after sunday's election. party leaders plan to speak over the coming days and weeks, urging to put the campaign behind them, and seek ways to form a government. questions for the president, if they will accept a coalition instead of external backing. chance thee is any

centerleft democratic party will join a broad alliance. the ceo of european oil giant relaxed about his company's lack of shell resources, even as the industry booms. the comments were made in an exclusive interview with bloomberg. more shale oil will come in 2018. cost,oil is not the same it is in saudi arabia, it is in abu dhabi. global news, 24 hours a day, powered by 2700 journalists and analysts in more than 120 countries. you can find more stories on the bloomberg at top . of wins in a run asia. the asia index out for the first time in six sessions.

japan is closing the session up tensions ease, and the sake haven buying again in the east today. the hang seng looking very good area at losses that we saw yesterday. in australia we have seen rates on hold. , whichsie dollar rose was driven higher by the rebound we have seen. that's have a look at the stocks in detail. material stocks rebounding in japan. steelworks surging in tokyo. the nikkei is rising its price target for that stock. then we have seen a return on the telco players in hong kong as well. jeffries saying that the selling yesterday was overdone. manus: juliet, thank you very much. the white house economic adviser gary cohen is planning a last

ditch effort. nejra: according to two people familiar with the matter, cohen is planning on a meeting on thursday. depend on which aluminum and steel. joining us from hong kong is our editor jodi schneider. what did gary cohen hope to achieve? has been gary cohen among the people who is concerned about tariffs going forward and there's a campaign going on with him and with some members of congress, including the house speaker paul ryan to try to get these terrorists stopped, or at least to have larger exemptions from them for countries and industries. there is a lot of concern. it is an unprecedented campaign during this presidency for members of congress, republican members of congress, and his own administration to band together to try to convince president

trump to not go through with this. they are worried about the potential economic effects of this, and possible retaliatory actions by countries, including some allies. manus: there is a lovely line in the story this morning about the political calculus of the president. why do you think brian has decided to so publicly voice his concern against the president peoplery cohen bringing in? what are the main concerns of republican leaders? this is playing to the base, isn't it? this is delivering on election rhetoric. juliette: it certainly -- jodi: it certainly is delivering on collection rhetoric. he has not taken opportunities to be tough on china the way he said he would when he was campaigning. speaker ryan and other republicans in congress are concerned not only from an economic stem point a political

standpoint. his is a midterm election year. house of representatives and the senate are in play. they are worried that something like this, if there are big economic effects, can hurt them. paul ryan in his state of wisconsin, harley davidson, the motorcycle manufacturer, they are concerned and had been telling him they are concerned about possible retaliation from europe, which would make it more expensive for them to get parts. nejra: what are the implications nafta discussions? are these just bargaining chips to get a better nafta deal? jodi: that is what the president seems to be doing. not stop hise will tariffs. he will go ahead with them. he is not going to have exceptions. if both canada and mexico, which are now engaged with the u.s. and now that, if this countries were to agree to the u.s. terms

of negotiations, he would exempt them from the tariffs many issues in a nafta renegotiations. six issuesettled on out of 30. it is hard to say they would come to an agreement that quickly, but that is the only -- hening chip he has put has put forward so far on the terrace. the president is noted to change his mind, and maybe after mr. session thisning week, there may be some change. they are pushing very hard for the president to stop these terrorists. manus: thank you very much. acta the classic trump trade, which is the distance between rhetoric and action. let's get more on the markets. our bloomberg strategist is with us. it is amazing how we almost , risk on, risk off.

there are 20 of room for wins here. mark: that might be the case. i have sympathy with the fact that over time this may be a verbal spat. trump and these tariffs in the next few days, it is unlikely to lead to a major trade war. that is not the dynamic that will affect markets at the moment. it is a more binary situation. investors basically care, have we seen the height of tariff panic. they say trump will back down and this mobile over -- this will blow over and we will go back to a bull market. or is there a risk of retaliation? is retaliation that investors are worried about. areill see if equities decided on the move. what potential impact

could this have on mario draghi and the ecb later this week? does it put a cap on the euro upside, and the italian election playing into this as well? i think it is unlikely we will see the impact on what draghi says on thursday. eu willno idea if the respond, or if the tariffs in the u.s. will go ahead. it might come a little early to affect the ecb. the ecb is going to be overshadowed by the u.s. foreign payrolls. we have many bank decisions this week, we have the bank of canada , ecb, boj, they are all going to wait and see if the wages climb in the u.s. for higher yields. wages, that high will be another weigh on equities, and we will see yields jump higher. there is a whole variety

of arguments, have a look at this. , 26 week3 week paper paper, the bills were pretty darn expensive. you get 1.6, 1.7% for three-month money versus five-year your paper in switzerland, germany, and france. we running for a bit of cover here in terms of the price of the money? are we repricing the fed? is that what the t-bills are telling us? what do you reckon? are attractives here in the u.s. they are much higher in the rest of to 10. -- 210. they are starting to look attractive. i think the treasuries, i

understand why people are concerned. therng up. there is the fiscal situation in the u.s., the massive budget deficit, it is like a perfect storm in that scenario. growth is strong as well. i understand we are in this binary situation at the moment, and we are near the 3% technical to 3.5 percent. but i think treasuries have found a base for that. markets are moving around the idea that the are attractive yields, and they want to pile in the for a couple of weeks. great story was a on the bloomberg yesterday talking about the fact that inflation expectations further out having coming up a little bit. if you look at the spread between a five-year and 10 year breakevens in the u.s., yields may be coming down for now, but where does the direction go further down the line?

consensus mark: inflation expectations disappoint in 2017. they were below where we expected the start of the year. their lower in 2018 them with what we thought a year ago. hass clear that inflation disappointed for a long time. this is not just a u.s. situation, it is a global situation. many people have argued, and i disagree, that the missing piece for inflation is the wages. the phillips curve went on holiday, it is not broken, and it will reassert itself. comes through,on the u.s. will get inflation, and i will drive the whole global inflation spectrum higher. , think that automation technological changes, and demographics will continue to weigh on inflation. i do not think that the lips curve will reassert itself.

-- i do not think that the phillips curve will reassert itself. us on the can follow bloomberg. let's get the bloomberg business flash with juliette saly. singers: paul ,anagement is building a stake according to people with familiar with the matter, they are nominating directors to the board, and pushing for other changes at the company. aliaesentatives for it declined to comment. volkswagen's cheating scandal as but the future of diesel engines in doubt here expect consumers to return to the embattled technology. the ceo made the comments to bloomberg at the international motor show. different.ation is the problems in germany have

been around for so many years. the communities and politicians have not reacted to that. what we can do, we can provide technology, explain the technology of modern diesels, market it, and make our contribution to seeing the diesel renaissance. it is part of the solution. juliette: that is your bloomberg business flash. nejra: thank you. the geneva motor show, there is a less glamorous issue on the ceo's minds. jodi: we discussed it with and mark. the car industry is the next battleground for steel. matt miller is on the ground. it is probably the conversation of the next 24 hours. matt, did morning. matt: good morning.

the last 24 hours it is all anyone is talking about. i am with steve armstrong. thank you for joining us this morning. the tariff issue is a huge one for your industry. it could affect the products you make. muchyou thought about how extra this is going to cost? steve: we don't export from turkey to the u.s. we would rather not have tariffs. hopeful the discussions that unfold between the various authorities that we managed to avoid tariffs. tariffs are not good for anybody around the world. hopeful the discussions that unfold between the various i am for free trade, and i hope that is how it plays out. matt: you expect raw materials to rise, you use steel and aluminum in your product. the last time we heard an billionit was $1.6

ahead of what was expected. but with this ad in terms of a cost headwind? steve: any form of tariff is going to be bad news for us, and will lift our cost. those costs will pass through to consumers. from that perspective, it is bad for the consumer at the end of the day, if we have to include tariffs. affect the industry globally. i am hopeful we will avoid those. europe hast share in been backing off over the last couple of years. where do you want to get back to and what are you doing to hit those targets? steve: we are delivering steps to make sure we are concentrating on operating in the statements -- in those segments. the last couple of years we have been comfortable. i expect 2018 to be better than

2017. we've had a great start of the year in sales point of view. last year got a lot of traction in the market. we have recently launched the new sport, that has given us a n importantin a segment which is suvs. by the end of this year, we will have refreshed 80% of our sales up to theeurope largest transit. have a feweem to problems there with the connection to the geneva auto show. the starting point of that conversation, nobody welcomes tariffs. his business is not dependent specifically on the exports

united states. the message is very clear. they do not want tariffs. daily profitthe i -- eyning, i-4 and eye leads to a global recession. matt miller is back with us. matt: thank you. we had technical issues with the transmission. you were talking to me about margins. i know you want to hit a target of 8% globally. the: the of -- steve: objective in europe, we are comfortable in europe which is good. we are launching these new products, it is enabling us to get there. matt: i remember the first time , you wereeco sport

making it for the south american market. it is a very popular. you were talking about how important this segment is. it ist for europe? steve: the fastest growing industry in europe. hasching the new eco sport been very well-timed for that. , it givestive lines consumers access to a crossover style vehicle, a little more affordable then an suv. that segment is important to us. germany, the in court made it possible for dieselto start to ban cars. i'm not sure if they will. i'm not sure what form those bans will take. the new euros 60 is clean.

we do not have the noxious issues that the older levels had. matt: that is true, but how do you tell consumers it is ok to biodiesel. steve: we have to work hard to gain their trust. is clean.el diesel will continue to be an important part of our offering. we still see a future for diesel . smaller vehicles, it will progressively disappear on the smaller passenger cars. matt: thank you for your time. steven armstrong here, the head afford in europe. back to you. manus: matt, thank you very much. boom. up, the m&a

this is the company that bypassed the special dividend. strategy.. barr's this is bloomberg. ♪ mom, dad, can we talk?

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nejra: it is 6:30 in london, 3:30 in tokyo. it you are looking at a shot of the emperors palace. yesterday, we saw the yen hedging for a 16 month high against the dollar. that reversed as the risk on sentiment came back in the markets. up 0.4% against the yen, and it is holding onto those gains today. growth in chinese travelers is spurring optimism for tourism companies, including hotels and m&a activity. m&us: one such company using

a to scale. the head of itv berlin. .t is the ceo, keith barr you are there in berlin. of thisa sense gathering. what is the big thing? in termstence in davos of the global economy, is that purveying across your gathering there? keith: you have seen that confidence you heard clearly. the hotel sector having dinner around the world you see the bleeding and hotels across the entire sector. you are seeing that acceleration of growth that we are focused on here, launching new brands. positive sentiment overall. concerns about a global

trade war have been rattling markets in recent days. we are seeing a little relief rebound today. could that be any impact on your business if we get a full-blown trade war? where would it come from. anytime there is an impact on the global business, it has an impact on this industry, but it is an incredibly resilient industry. in the past two years we have had only two downturns. and that was in macro events financialand the crisis. overall, it is a resilient business. any macro event will have a short time impact because of travel. you have economies going from strength to strength. you are seeing our top revenue growth in that market. you are seeing acceleration and a lot of the u.s. as well. continued recovery in turkey and france, and growing in the u.k. as well.

generally a positive momentum across the business. that can be at risk if there is a big event. the last time we caught up with you the stock had dropped. in bypassing the dividend, that was your message to the market. the market punished the stock on the day. you have seen to have taken probably said, i do not respond to one-day stock movements. respond to the markets? keith: we have come back strongly. my conversations with our shareholders is our commitment to accelerate growth around the world, our court use of cash is to maintain our ordinary dividend and grow that. then, when we have surplus cash, we should return that to shareholders. our commitment to that is

continuing. we are focused on accelerating our growth, we are launching new brands. .e have launched avid hotels we recently announced we would launched two new brands this year. we are looking to acquire a luxury brand. growth, andting in that is what our shareholders want. needsant us to meet their so we can accelerate and have sustainable growth. you said you are looking to acquire luxury brands. any in particular that you are targeting? keith: if i named them, the price would go up today. we are focused on acquiring -- nejra: generally, where are you looking? keith: there are small luxury brands that have not had the

ability to scale up globally. some have been up -- some have been around for a while. ihg acquiring one of those brands, nurturing and expanding it is critical to our success. valuations, is of gather data from our bloomberg intelligence team. we are looking at enterprise values in asia relative to the u.s., relative to their european peers. it is far in excess of the european peers, do you think this is an expensive market to asia whicherms of many people say it should be your focus? we are seeing great growth across asia in all of our

brands. we are making sure we can acquire a luxury brand at the at the right price point. we are not going to do a huge deal. we are focused on acquiring something we know we can incubate and grow and will be a strategic fit for us. asia, that is exceptionally strong. the pipeline across resorts, and accelerating growth in places like china, and vietnam is doing exceptionally well. it is an exciting part of the world. you mentioned china early on, they recently surpassed the world outbound travel market. it is a great place to be invested in, our history and heritage in asia is exceptionally strong. nejra: you said digital will be the big differential between the players in your industry. what can we see from you in terms of digital deals? fundamental that

the industry is more dependent on digital. what is driving consolidation in the industry is the big company'stechnology, and reservn platforms, mobile application, analytics, and so forth. small companies cannot afford to do that. the big hotel companies will get bigger. the big five have 20% of the .randed pipeline the industry is becoming more branded because of our ability to invest in technology. we have a new central reservation platform launching this year, it is already in 200 hotels and will be in our -- in all of our hotels in 2019. you will see more things in that nature where big companies are investing in digital and new technologies to strengthen the customer proposition, and try profits to our hotels. manus: we want to pick your

brain a little bit. we have this story from the bloomberg that the u.k. and the u.s. have had secret discussions in january. the u.k. walked away. the u.s. is offering a worse deal. if you take that and the consumer confidence, how is the u.k. holding up? what are your numbers like in the u.k.? is brexit precluding you from directly investing in the u.k.? today the u.k. is 5% of our business globally. we had solid results last year in the u.k. in terms of revenue growth and hotel development, i had conversations with owners who want to invest in the u.k.. it is such an exceptional market, a great destination. uncertainty,e is business does not like uncertainty. we have been engaging in the government's to understand what will be the impact on employment.

focus on that, and our ability to grow our business. hospitality and tourism is a great creator of jobs, and growth commitment to gdp. brexit is uncertain. my peers are not competent in understanding what they should be investing in. we benefit from domestic travel and international travel. havinge pound depreciated a bit, it has made the you kate more attractive for international inbounds. u.k. moremade the attractive for international inbounds. more attractive for international inbounds. nejra: everyone is looking for certainty. let me go back to the question to returning capital to shareholders. we talked about the special thatend, and did here there will be a one point -- $1.5 billion buyback.

we talked about the special dividend. would you consider any share buybacks in the next year or two? keith: our strategy has been consistent. we returned $13 billion to shareholders. that commitment remains. fundamentally, we will invest for growth in this business, and what would we have shared -- surplus cash we will return it to shareholders. we have done some shareholder buybacks. though we are continuing to invest in this business, which has so much attentional to grow globally, also to the u.k. and in europe. , ceo, ihg.h barr great to have you with us. manus: and a reminder if you are a bloomberg customer, go to tv more of us.

you get the charts, the functions, you can join the conversation. nejraree to send go and download those charts. and look at the bios of our esteemed guests. plan fornald trump's its steel tariffs will damage theeconomy, and also says $450 million investment, one of the best deals i have ever done. he spoke exclusively to bloomberg. access,e having plenty of resources potentially, is a good bet for the future. we did not plan for that. when we announced 5% growth, we

did not announce that. i don't choose where you find oil and gas in the world. it is where it is. even if you have plenty of class-action lawyers, then you have libya, so you have different risks in the world. there is no perfect place. >> to wrap it up here, back in the u.s., we have heard about tariffs, 10% on aluminum, and 25% on steel imports. how do you think about that as the ceo that invests in the u.s.? >> i am against all these commercial rules. issue, political problem not only in the u.s. i think there is a problem. globalization is rejected

somewhat. it is positive for many people around the world. i cannot be in favor of trade wars. , i am concerned because our shareholders, the irony that the u.s. -- because of two because of some foreign companies complain. the solar market will drop. i think on steel and aluminum, organized chains are for countries, from mexico, canada. , in the endurers

the customers will have to pay. >> for a pipeline, does that worry you? >> i can weather the storm. people will act. i am not sure you create more jobs. it is a very little number of jobs. people will store solar panels on the roof, these will create jobs. is,he end, the question will it create jobs or destroy jobs? it is not good for the u.s. economy. as a global company, i am not in favor of bidding wars.

peace in this world who come because we want to build bridges. when you're traveling to work, tune into bloomberg on your radio or your mobile advice -- your mobile device. i will be running off to radio after this hour. two jobs for the price of one, that is nejra. we are back with the geneva motor show. a little bit later on. discuss a last-ditch attempt by the white house economic adviser to halt trump's trade tariffs. that conversation later. this is bloomberg. ♪

♪ york in the new

late evening, early morning. it is all about mr. ryan and mr. hen trying to. coyhe sident against the tariffs. juliette saly has your business flash. elliott management is building a stake to take on the carrier's largest shareholder event. according to people with -- familiar with the matter, they will nominate directors to the italian board, and push for changes at the company. chairman hasve said u.s. financial regulators are working quickly to make material changes to the volcker rule. acquitted inwas

the dodd frank act as a way to avoid risk-taking from banks trading with their own money. it has been a top target from the trump administration to dial back regulations to spur economic growth. global emissions cheating scandal has put the future of diesel engines in doubt. they expect consumers to return to the embattled technology. the comments were made in an interview at the international motor show. >> the situation is different. the problems in germany have been around for many years. the communities and politicians have not reacted. what we can do, we can provide technology, explain the ,echnology of modern diesels market it, and make our contribution towards seeing the diesel renaissance.

it is part of our solution. juliette: that is your bloomberg business flash. you so much. let's go back to geneva where matt miller is at the auto show with the jaguar land rover ceo. very special guest here. we are always glad to spend time with the head of jaguar land rover. you have what a lot of people are talking about as the tesla killer. i do not know what you think of that moniker, the electric vehicle is groundbreaking in that you beat all of your competition to the punch with this. tell us about the vehicle. >> the vehicle is a game changer. these kind of opportunities do not come often. years ago we designed this vehicle with the clear aim to deliver something special. to use this propulsion system

and have a package without compromises. this vehicle goes back to the dna of jaguar. that means a new design language. more interior space, and a small footprint. and a new agility, new drivability. it is really a very interesting. for those of you who do not know a lot about cars, that is a massive amount of tort. -- a massive amount of torque. what are you expecting from this? is high demand coming in. people really like the vehicle. i do not want to give a prognosis. to theseno comparison

vehicles, that is a very first. nobody knows how many people want to go this first step. it is a convincing product. the market seems to have been growing, and has now peaked as far as car sales. how do you see it for the industry? ralf: overall the industry is growing in europe. we see slight growth in europe. the so in the u.k. encouraging. matt: what are your plans for the u.k.? how do you prepare for brexit? are you starting to pull some of your operations out of the continent into other markets? no.: the u.k. is our home market. we will stay in britain. we are committed. all of our research and

u.k. weent is in the hope the politicians on both free are clear that only and fair trade at the end of the day delivers. back 200 years ago, adam smith .efined this kind of theory theory are relative today. proved economies have that free and fair trade is the best product of society. it does not seem the white house has read much adam smith lately. the talk of steel tariffs is the talk of the show so far. what are your concerns about steel tariffs and how that would

affect jaguar land rover's being exported into the united states? read a lot of twitter, or hear a lot of information, but we do not see details. at the moment we cannot make any comment or statement about this kind of development. matt: how much are you actually shipping to the u.s.? how much of your product is going into the u.s. would be affected by tariffs? ralf: the u.s. market is a very important market. the u.s. is one of our biggest reaches globally. tradee the free and fair relationship will continue in the years to come. ask you about china. they seem ahead of the curve and terms of electrification, infrastructure, they're working .ard on it in china more than that europeans and

americans. how much do you expect that to help sales? ? expect the power of the portion in huge china. it is an important market. china is a great market for us. abouti want to ask you land rover. i fear there is a new special vehicle coming out later. can you tell us anything about your debuts? ralf: please wait and watch. the vehicle talks about its own. matt: i'm expecting some sort of coupe to come out at this show. thank you very much, matt. teams,a couple of big trade war's, stocks are rising, we've got a couple of results. , keep we've had results

in ion when the equity markets open in just one hour's time. i am off to radio. talk morere going to about cohen and nunberg at the white house. ♪ retail. ♪

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send a less democratic party would join a broad alliance. the ceo of european oil giant said he is relaxed about his company's lack of shell resources. even as the industry booms. the comments were made in an exclusive interview with bloomberg. i think shale oil is a good resource. more shale oil will come.

all shale oil is not the same cost. it is an abu dhabi. juliette: global news, 24 hours a day, powered by 2700 journalists and analysts in more than 120 countries. you can find more stories on the bloomberg at top . it is a win for markets in asia. the first win in six sessions as these trade tensions. we are seeing again of 1.2%. yet weakness on the nikkei had a solid session today. samsung is helping out. a reversal coming through as steel players in india. up by 0.4%.

let's have a look at the stocks we are focusing on. , one of thetronics strongest in the region at 4% today. japan works to show the rebound in steel and aluminum players had the 12 month target price. movement coming through in hong kong. sunac will see growth on profits. strong property momentum continuing along mainland china and hong kong. the white house economic adviser gary cohen is trying to convince the president to hold the implementation of steep steel tariffs. the threat of a trade war is political. the real impact of tariffs is likely to be small. -- jodiee what

schneider joins us. they say this might be the breaking point for cohen. has beeny cohen against these tariffs. he is not saying if able to stop the president from implementing them. breaking pointhe that causes him to resign and leave the white house. he is not alone. there is an extraordinary campaign of administration members and republicans in congress to try to stop these tariffs. among them is paul ryan, the house speaker who has not broken with the president much during the administration, and is now pushing to stop these tariffs. that is the reason they have set up this meeting, to try to have the president here this, -- have this.esident hear

we talk about paul ryan, it is fascinating he has come out against these tariffs going head-to-head with trump. what are the concerns overall of the republican leaders at this point. they just had the tax sweetener. ofbe with the risk retaliation. the tax billt through, and that was a big win. they hoped it would feel an economic boom. this is a midterm election year, both the house and senate are in play. bad economy.ant a did not want to run on a bad economy, or in the economy that has been wounded by the actions of the republican president. since republicans control both chambers of congress, they are worried about retaliation. tariffs affect their allies as well.

the implications for the current nafta discussions, one of our stories this morning is that exemptions might be available for canada and mexico if they come to the table and do a better deal. think it is all just horse trading? jodi: the president has so far said he will not allow exemptions for countries or from thes, carveouts tariffs. he did say he would allow an exemption for canada and mexico , ifhe nafta renegotiations they came to the table in the middle -- in the nafta renegotiations and agreed to the u.s. terms. that is unlikely. settled six of 30 issues in these talks, which have become very contentious.

he is clearly trying to get them to agree to the tariffs, both canada and mexico have not done that. canada in particular is a big supplier of aluminum to the u.s. industries, so it does not seem to want to go that way. it is clear at this point, and again, the members of congress were concerned, the administration, it is political. this is an election year in the u.s. manus: indeed. passingu very much for everything out of the last 24 hours. it goes on to say and the link in the article that there could canada and the united states. matt miller is on the ground at the geneva auto show, and he is covering everything raking there. good morning, matt. you have a guest. matt: i'm here with carlos tavares.

the tariffs have been a massive issue here. the u.s. ship cars to yet, although i know you want to. you have a mobility steam over there -- mobility team over there. what do you think about a trade war. donald trump thinks it is a good one that america could win. carlos: we need to step back and make a difference between a final decision and a negotiation position. maybe there are some thought to be delivered. at the same time, the better we trade over the world, the better it is for humanity. we will soon have 9 billion people on this planet, and i believe with 9 billion people we have an open world where very peacefully we can trade and deliver the best value on the rate -- in the region. i think it is a negotiating position. there are some tensions, but in

the long run we are better off if we have an open world. we take care of the planet and take care across the regions. matt: you put a lot of steel into your products. tariffs could drive up rises that are expected to rise. what do you think about raw material costs? carlos: it is a great point, and you are right to say it is another factor of uncertainty. but, to make you smile, i will tellcarlos: you the world is aln chaos. you just have to see how the trading relationships are moving right now in the world. , for our global player company's agility, it becomes something important to adapt to an agile way. of the day, the

companies will protect themselves, and it will make mobility more expensive for the consumer, which i do not pick is a good strategy. matt: one thing that has not chaotic, or at least in a bad way, sales have been going up. how do you see european car sales? are we at a point where we are a bad peaking? matt: we believe in 2018, markets will be stable. said, let's recognize over the last three years, we were always wrong in predicting the european market. it continued to grow. that is the reality. we are blessed with good 2017 results. we are moving and preparing for the future. -gt, a newhave the 508 product from peugeot that is gorgeous. what do you expect us to do for sales?

for the image of peugeot? 508 is an important car, the flagship of the brand. it is very sleek. it is a pleasure to drive. at this point in time, some level of competence of the brand, in 2017 we hit a world record in sales. more than 2.1 million cars. as much freedom as they can so they can express their talent. a concrete and visible expression of talent. matt: don't you think americans will want to buy this car? when are you going to see shipping cars over there? plan in theave a strategic plan. we want to come back to the u.s.

market because we believe it is a fantastic market with very specific customers but we want to do it on a step-by-step approach. the u.s. consumer is very specific and has very clear expectations. we want to understand those expectations. this is the reason why we are working with mobility services in the u.s. and then we will evaluate when to push the button to bring this gorgeous car to the u.s. consumer. yes, it will happen at one point but we don't want to rush. we want to be a very staged plan and lucid way of coming back to make the u.s. consumers happy. matt: you put out your numbers last week. doing well financially. opel still making losses, although they were narrower. what is the problem there? what are you doing to fix that and how soon do you expect that to be back to profitability? carlos: in 2017, we were blessed

with good results. 23% of the profit. as you said, despite the opel losses which represents a very big opportunity. we want to become a european automatic champion, bringing together french and german skills. this is exactly what we are going to do. that is something we know how to do because we did it for ourselves a few years ago. we believe we have the right plan that the opel ceo is implementing. it will take some time because we need to do it for the people and not against the people. we want to do it with our union poppers -- partners. the plan was built by the employees to turn around their company without support. that is very important. we wanted to be a german led turnaround plan and that is what is now happening. it will take time but it will happen. matt: in germany, the courts

have allowed cities to ban diesel if they need to. it looks like that may start to happen now. what do you think about the future of the diesel? will you continue to make diesel passenger cars? carlos: it is a complex issue. the first unfortunate consequence of the diesel in europe is that emissions are increasing. we recognize that in the end of the day, the consumers have the final word. there are regulations, we are meeting the regulations. we will give the consumers what they want to buy from us. we have a very clear strategy in terms of multi-energy platforms. we can assemble on the same assembly lines, special cars, diesel cars. electric powered cars. we can assemble on the same

platform which gives us a lot of flex ability to match the market of the market demand which is very impossible to predict. comfortable of our strategies facing these comfortable of our strategies facing these uncertainties. at the end of the day, the reality is the boss is the consumer and we will sell the consumer what he wants to buy from us. of course, we also have a platform which gives us a lot of flexresponsibility from the govr -- government, the company's to give them the appropriate information. on that i mentioned -- dimension, we have been making strong improvements in terms of transparency. we have been taking initiatives with ngos. websites can go to a and have a look at the real consumption and emissions of their cars. specific protocol that is now under the control so that we have this very representative protocol that gets results that are accessible to consumers. consumption and emissions of their cars. matt: thank you for your time.

carloscarlos tavares here in the geneva motor show. back to you. manus: thank you very much. matt miller on the ground. it is just under 38 minutes before the start of the european trading day. trade wars could be a political sideshow. what we have there is a better bid on the u.s. stoxx 50. you can clearly identify that the european equity space, it is the impasse in politics which is driving the mid lower. so that hold back growth? markets shrugging off president trump's trade threats. the world director trade general saying an eye for an eye. what an amazing sign from a ceo. talking about the world in a state of chaos. from carlos view

taveras. david page is a senior columnist and joins us now on the set. thank you for standing by and listening. when he talks about the world in a state of chaos, we are already in chaos so agility is needed. do you believe that trade wars sideshow?tical how concerned are you? david: we are concerned. the rhetoric is clearly ramped up. we are at the age of a trade war and that can have an invitation -- an implication. there is no economic or security benefits from the u.s. with these moves. is it political? you would have thought that trump would have gotten better to ride the successes of the tax reform. you then fall back on presumably about trade negotiations. a chinese delegation with the u.s. last week, it had something to do with that. nafta negotiations going on now. this seems to be more after the

deal. do for thatave to is convince us he is a rational player. that is how the art of the deal brings about a better deal for the u.s. he looks like an irrational player. it looks like perhaps gary cohen tries to rate him back. manus: not that it is my job to defend the president of the united states of america, bill clinton introduced tariffs, george w. bush did. it is a very presidential thing to do. david: the key difference was that bush introduced tariffs that excluded canada and mexico and we are not sure if that will be the case. if that is the case, we have seen this before, it has some implications. there is probably going to be a relatively light round of retaliation but not a new place. if we see it imposed on canada and mexico, it has much more

market implications for the nafta negotiations and that suggests a break in the last 20 years. that has relatively more implications. i think that is what makes the next few days key. know the specifics of this yet. there is an idea we may see it signed into policy on saturday in pennsylvania. we will see how they come through. manus: the pennsylvania district has 17,000 voters that are either steel workers or related to them. and the powell inflation prospect he might face. even the highest in five years. this kind of hubris would really add to the inflation expectations. david: absolutely. what you see is an economy growing above trend. we already see some inflation pressure coming through. we already consider the federal reserve meeting to move than that three times it's currently considers. we expect four times off the

cross -- through the course of this year. now trump threaten something that would reduce u.s. capacity even further, creating marginal inflation pressure. this is something the federal reserve does not want to cope with. it has an implication for inflation. that is how the fed would have to judge how it would respond. in the short-term, it is lately pushes the fed towards a more hawkish policy and it will make it clear in suggesting most of the fed having hikes. manus: ok, david, thank you very much for being with us. we get more value over the next time you are in. david page joining us. breaking headlines coming through from the eu. tariffs against the u.s. in regards of motorbikes. harley davidson will be one of the companies visiting the white house later this week. against u.s. products. this is seen by bloomberg. the eu will mill tariffs against

the united states, bourbon and whiskey imports. this is bloomberg. ♪

anna: welcome to bloomberg markets. i'm an edwards of the new london headquarters. i'm matt miller at the geneva international motor show. cash trading is less than 30 minutes away. ♪ anna: trump tariffs. gary