♪ francine: "leaders with lacqua." is thee: carlos ghosn ultimate executive car guy. he started his career at nissan, then went on to climb the ranks. he holds one of the most powerful positions in the car industry, serving as chief ofcutive renault-nissan-mitsubishi alliance. during his rise to the top, earned nicknames after returning the company to profitability and rescuing nissan from bankruptcy.

ghosn faces the next challenge, the auto industry into the future with electric cars. today we meet carlos ghosn. why do we have so many car companies? carlos: it is getting diversified. the car industry when it started was local. europeans in europe, the americans in the u.s., and japanese and japan, and now we are becoming global. you will have much less in the future. francine: at the moment we have 20 global car companies, 20 chinese companies, 20 makers of batteries. how will that change. carlos: you will see a consolidation in china. chinais a rumor that would like to regroup companies into champions. also, a consolidation of the the first oneand

is the fact technology is coming and there are a lot of technologies hitting the industry. in order to face this challenge, you need investments and small companies will have a hard time to follow. that is number one. second, you know that scale when it is a competitive industry plays an important role. these two factors will be driving consolidation. francine: i want to talk about regulation and driverless cars. if there is one technology you wish you had the secret to today, what would it be? carlos: one thing that is happening now is the fact that in the industry today the products and services around the products are taking the drivers seat. this was not the case 10 or 15 years ago where the processes, organization, global expansion, and now we are to connected cars, autonomous cars, and all

of this is made possible because of the arrival of competitive powerful, lower costs, artificial intelligence. there are a lot of technologies that make things possible. 10 years ago we were dreaming of cars with the level of autonomy that we are able to do today, because the technology and components were not available. francine: has it gone faster than you thought? carlos: oh yeah. in a certain way we were imagining some of the functionality, but did not know how this would happen because of the components that were not ready. now it is coming faster. it's going to go much faster than before. francine: how fast? carlos: i will tell you. you will own a car. a lot of people want to own a car and be able to drive when they decide to drive, but also be driven when they decide not to drive. if you are in a traffic jam, a

highway, downtown, you don't want to drive, you'd want to do something else. you will be able to do that. if you want to drive and enjoy the scenery, you will be able to drive. this, the car without a driver, which is a completely different topic, which is mainly commercial use. i bet you will still drive a car, but be much more in charge and you decide what you want to do. today, you just have your hands on the wheel and ice on the road. that is it. you will be able to do many other things. francine: when is that happening? i'm stuck in traffic and don't want to drive anymore. carlos: 2022. francine: that is starting where? first in the u.s., then europe? carlos: particularly in developed countries, mature markets. u.s., japan, china. the chinese are extremely eager for the technologies.

i would say china, united states come in japan, and europe. this is where it comes from. francine: the regulation will have to be sorted by 2022. carlos: the regulations will come quickly. are keepingse we them aware of the technology so it will not be a surprise. cars,, because autonomous cars without a driver, are very safe. we are not talking about the accidents that happened. i'm not talking about that. today, countries know one of the major problems they want to get rid of his safety on the roads. there are still too many people killed or hurt on the roads. for you are going to this autonomous system into the car, the car will take control by itself. you will not be able to drive at the faster speed than what is on the speed limit. if there is an obstacle and you

don't see it, the car will see it in and stop. a lot of mechanisms will make the car center. safety will be driving these technologies and making the regulators eager to have them on the market. francine: if i am driving and swerve left and there is a baby, then swerve right and there is 10 people, how will technology make a decision? the regulators have to basically decide -- carlos: it is true there are some extreme cases to be solved yet. have for years to sort out this technology. you have 1.4 million people dying on the roads every year on the planet, 1.4 million. we think with all this technology that we have the potential to reduce this number of casualties by at least 50%, if not 90%, so a massive numbers of lives at stake behind this technology. you may have some specific cases , i agree with you. we have to solve them them about

when you compare this to the number of casualties on the road come there is no hesitation that we should move as fast as we can. francine: 2022, but i'm still driving. what is the next step? when will i have a car where i am not a driver at all? carlos: this will be in parallel, in 2022, you will have a car without a driver in the but it will not be yours. the car without a driver by definition will be used by taxi companies, uber, federal express, dhl, and commercial vehicles. it will be more for commercial use. today it is the most expensive cost when it comes to commercial used, the driver must so if you can get rid of the drivers, well obviously you will reduce the costs, which will be to the benefit of the consumer who will have to pay less for transporting of goods. this goes with the development of sales on internet and

delivery to the house. you can see all these technologies are combining to make the life of people much easier and cheaper. francine: will it be global car companies that actually work on both sides, or technology companies that will do the second one? >> we can't predict who will be competing against who, but car companies have a huge advantage because making a car is not an easy task. it is a highly regulated industry. it is intensive in capital. it is heavy in employment. it is low margins. the barriers to enter the car industry are very high. the carf this, even if will be autonomous and connected, it first has to be a car. it needs to respond to safety, to emissions, etc. francine: coming up, roadblocks

to growth. we talked trade and what protectionism means to the car industry. more with carlos ghosn next. ♪

♪ rising trade tensions and protectionism have scared many businesses, especially the ♪ car industry. they have warned a trade war would raise costs, so how does a car executive like carlos ghosn plan to whether the possible storm? how did the supply change change for carmakers in the last 10 years? carlos: it has become more global. you have thousands of parts, hundreds of technologies. we need lots of people to make parts, developed technology for us. we need people to assemble the cars. we have people running in china, russia, japan. .t becomes more and more global

it is becoming more global because consumers are more demanding. globalization is hard on companies because in every market now you are competing against the best in class. the easiest market of the markets with closed doors. why? life is easier without competition. when you have a closed door, you have a limited number of competitors. you make more money come usually. there is less competition, but who pays the price? that is why i think when were talking about globalization, we need to consider the fact that globalization is more demanding that is why, and companies usually don't like it, but they don't have a choice. they need to compete with the best in class, which demands from them a lot of efforts in terms of competitiveness, even in terms of innovation. francine: do you be leave we are

coming -- believe we are becoming less global? carlos: globalization has been going for so many years. you have stop and go. steps back, five steps forward, one step sideways. human life and human history is not linear. i am expecting bumps and problems and obstacles and resistance here and there. at the end of the day, , there is more of it, long-term trends. francine: if there were to be of big trade war, how difficult is it to change the supply change? companies --rker are car companies? carlos: they are faster they will do it, if needed. , those whoo tell you will pay the price of the consumers. that's it. that is what will happen. francine: will they realize?

carlos: i don't know. they will rely's when the price goes up. paycan say consumers will the price, but as long as the price is low, nobody will react. when the price goes up, they will say, oh, what is happening? you raise costs and at the end of the day costs will be passed to consumers, and that is what will happen. francine: talking about batteries and electric cars, how much progress will we make in five years? carlos: already i can take you for thethe pioneers mass market for electric cars. it is going very fast. to five years,ur what you can expect is a 35%ction of between 25% to on the cost of batteries. using the present technology, obviously if there is a breakthrough, you can go faster than that, so i'm expecting this

to go down fast. francine: is tesla your biggest threat in that sector? carlos: no. it is an ally. tesla started with premium cars. the decided to go with premium cars. corented to address the market, so we went with cars , like commercial vehicles. addressed the light commercial vehicle and the heart of the market. ,o when we start to go to this we started the heart of the market, the mass market. tesla started with the premium cars. we are allies in a certain way. we wanted to make the idea of all electric cars possible, that people consider electric cars is normal cars. now thanks to everything we have done, yes, the electric cars the car of the future. the same people who 10 years ago said this will not work, etc.

we are glad of this competition. it will be brutal and all the sectors, but we have the advantage of 10 years of experience. francine: do remember 10 years ago and meeting or did someone come to you and say this is the future and that is when it clicked? carlos: no, we said this will work and we had plenty of skepticism. thinkne: why didn't you it's not going to work? carlos: frankly i didn't see any outcome for the car industry. i did not if it was going to happen 10 years down the road, 20 years down the road. i didn't know, but i knew it was going to happen because there was no way the car industry would develop without bringing a solution to the emission problems. wasmind you also that there a lot of more dependency on oil when oil was more than $100 a barrel. less dependency on oil and the

emission problem, climate change problem, made it practically impossible to imagine the development of the car industry without zero emissions. francine: up next, full speed ahead. carlos ghosn earned a place in the automotive hall of fame with his turnaround come about what kind of leadership does it take to affect real change. ♪ ♪

♪ or twone: carlos ghosn about leadership. he ran three struggling companies and drove them to highly touted turnarounds. , heto his success at nissan had comic books made in his honor in japan and nabbed a place in the automotive hall of fame. in a 2011 survey, he topped barack obama in a poll in what celebrities you would want to run japan. carlos ghosn is still with us. what does it mean being a leader in 2018?

carlos: the leader is the guy in charge of the company. that's it. it is very simple. there is always one person people look at and say, he is in charge. team, around him a board, but there is always one person in charge of the company. francine: are you a different leader now than 20 years ago? are you more focused on sustainability, not only what the company will become, but doing better in this world? carlos: by definition, a leader is in charge of the company. when you are in charge of the company, you are preoccupied about the present and the future of the company. so you have an image of the that you haveoals immediately on which you want to deliver, but also you have an image and build an image about what you want to prepare your .ompany for 20 years ago, i was not

preparing the company for what i am preparing for today. the way i am looking at the future today is different than 20 years ago. a lot of things have changed. my image of the task is very different when i look back to what i was preparing the company for a few years ago. francine: do employees and clients expect the leader now with a set of values and a set of morals, that they did in 20 years ago? carlos: in general, leaders are important in times of crisis. ago -- it was 20 years in a certain way when everything you have a leader for you. know who it is and don't care about because things are going well and you don't really need a particular direction. when you have a crisis, a crisis can be generated by outside the .ence, inside events i lived through nissan and crisis in 1999 where i had to revive the company.

this was a crisis from inside. when you have the financial crisis in 2008, all companies were in crisis. you pray to have a good leader, because you know the future of your organization and your own future depends on how fast it he is going to react. will he see things clearly and take the right decision? i would associate leadership with crisis. there is less demand, less attention when things are going on, more complacency, but much more expectation and demand when you are afraid and worried about what may happen. francine: you are the fixer ceo. you come in and turn around the company. is there a theme for your restructuring? was a different every time? carlos: it was different. fixing nissan is different from what is being done today with mitsubishi or what has been done for many years for renault.

company, this is what i called the difference between turnaround and revival. a turnaround is where your fixing the problem on the short-term. after two or three years, the company is going well, but maybe four or five years down the road, he comes back to trouble. this is a turnaround. a revival is 15 years down the road, the company is still doing well. what you want is to make sure the measure you are taking our measures not only are going to be impacting the short-term, but also be good for the long-term. francine: how do you succeed at this? carlos: you are not sure you will succeed, but you want to make sure you are conscious of the fact that success is not short-term future. it is something that will be measured with time. has been revived because 19 years up to the revival plan, nissan is still going well. i consider renault is doing well

because after the financial crisis, for the last 10 years, renault has been moving up in terms of growth and profit. i consider mitsubishi is doing will not only because the turnaround is quick, but because we are planting the seeds to make sure three years, four years down the road, the company will continue to grow. if you have this mentality that i don't go for the quick fix, the short-term commodity you have to solve the short-term them about at the same time you keep your sites on the longer-term and plant your seats on the longer-term them and no matter the cost of the seats on the shorter term. francine: have you ever had a bad day in the office question mark carlos: sure. francine: how did you get over it? carlos: i am used to it. when you are charge of many companies coming your happy when there is only one crisis. you usually have many of them. you get prepared. you learn how to detach. not being in different or passive, but active and detached because you know you cannot take

everything apart. it is a kind of training. it is a training by doing. francine: if you were to start a car company from scratch, what would it look like? carlos: it would look like an electric car. obviously this product is connected. to invest byot try myself. i would try to make it buy something, because the assets in the car industry archie. i would have the software engineers i need. it, this would be the best way for success. it doesn't have to be in a market like the u.s. you can go to india, china or some of these countries. tohink you can start company become global anywhere in the world. francine: i know you are passionate about diversity. have you always been passionate about it? carlos: i had the privilege to have been born and educated in

two countries where diversity is a fact. in both countries. i was born in brazil. this is a country of diversity. diversity transcended the weakness. so i have lived with diversity , whichmy first 16 years obviously had a lot of impact on me. i connect with people. i like culture. i like history. i like diversity. at the same time, i measure how fragile it can be if it is not managed well. at the same time, if it is managed well and you don't go against the identity of people, it is powerful. when example on one particular product and technology we have developed, which is due to this diversity. needed my engineers, we was developed in

india, i said i'm going to do the $3000 car. he did the nano. i said we will compete against the nano. when i turned to my engineers and said we would do this, they said that will not work. i say, ok, the french and japanese are incapable of doing a car for $3000. technicalveloping a center in india. in india, everybody considered this feasible. i said for us to be successful, i did take french and japanese in engineers and marry them with indian engineers. this car exists and is being sold in india, latin america, and will be sold in many other markets. this was due only to the diversity of cultures and knowledge coming from french, japanese, and indian engineers. the indians by themselves i don't think would have been able to do the car, but the french and japanese did not even think

it was possible. it is by using diversity that it was made possible. francine: carlos ghosn, thank you so much. carlos: thank you. ♪

>> is almost 10:00 in hong kong. you're watching "bloomberg markets: asia." yvonne: asia-pacific stocks slide as japan gets up early gains. david: again hitting a one year low as traders the prospect of further rate hikes. yvonne: oil remains near a four-year high as russia says the price may not be right. moscow is looking at $65 to $75 a barrel. david: aviation is the biggest growth sector in the world. we hear from the ceo.

at this point, southeast asia is waking up, coming online. we are waking up, higher yields, stronger dollar. yvonne: once again, look at the board. you will see how the rest of asia. it really was a strong data we got from the u.s. overnight. how het to comments over doesn't see neutral yet, though we see capitulation in the bond market right now, but that is the move. the gmm, let's see what we are seeing across most indices. the hang seng, down 1.5%. for the -- 400 points lower today, seems like the cospi is falling and singapore, down 1%. it really is this stronger dollar story finally catching up with a pick up in yields we saw. it