Good morning. It's Monday, the third of July in London. This is Bloomberg Daybreak in Europe's podcast with Caroline Hepga and Stephen Carroll.
Coming up today, we'll have news from Apple about the production of their mixed reality headset and.
Tesla sets a delivery record for electric cars.
Plus we'll have the latest on the riots in France and what it means for President Emmanuel Macran. But first our top stories.
Apple is reported to be making major cuts to its Vision Pro headset production plans. Bloomberg's Un Potts reports it.
Was seven years in development, hailed as the most significant product launch since the iPhone, But now, according to the Financial Times, Apple is making drastic cuts to production forecasts for its mixed reality Vision Pro headset. The paper says the complexity of the three and a half thousand dollars headsets design and difficulties in production have forced the move. It says fewer than four hundred thousand units are likely to be made next year. Internal targets were for sales
of a million. The report, which Apple hasn't commented on, comes in the wake of the tech giant hite a three trillion dollar valuation on Friday seventy its place as the world's most valuable company in London Immunepotsi BIM Big day Break Europe.
Tasla has delivered a record of more than four hundred and sixty six thousand cars worldwide in the second quarter, outpacing Wall Street estimates. More from Dembrick's Charlie Palace.
The deliveries are the most ever in a quarter for Austin based Tesla and an eighty three percent increase from a year ago. The results demonstrate that CEO Elon Musk's vowed to chase volume by cutting prices have had their intended effect. Analysts survey by Bloomberg had expected Tesla to ship four hundred forty eight three hundred and fifty cars
in the quarter. The company also managed to trim the gap between production and deliveries, a number closely watched by analysts, to thirteen thousand, five hundred and sixty units in the second quarter. In New York, Charlie Pale, Bloomberg Daybreak Europe.
French President Emanuel Macon will meet the leaders of the National Assembly and send it today to discuss the spate of riots that have swept the country. The number of arrests fell to one hundred and fifty seven overnight, according to the Interior Ministry. Macar held another crisis meeting with ministers on Sunday evening, as forty five thousand police and
special forces were deployed for a third night. Meanwhile, the grandmother of the teenager Nail, whose killing sparked the unrest in France, is calling for an end to the violence.
The people who are pillaging stop. Stop they're using Nile as a pretext. No, they must stop destroying the shops, the schools, the buses. The mothers take the buses, We take the buses.
Tomorrow, I man who in Macall will meet mayors from the two hundred and twenty areas most affected by almost a week of rioting. A first estimate by insurance has put the cost of the damage from the violence at more than one hundred million euros, a number that is expected to rise.
The corruption trial of ECB Governing Council member Peter Kasimir begins today. The serving Central Bank policymaker is accused of offering a forty eight thousand euro bribe to speed up tax procedures against several companies during his term as finance minister. The Slovak Central Bank governor who denies wrongdoing faces up to five years in prison if found guilty.
Chinese President Shijingping has elevated a long serving technocrat to the Central Bank's top Communist party role. Pang Goong Sheng was named as the pboc's party chief over the weekend. Bloomberg Economics's chief Asia economist Chang Shu says that one key sector of the economy could now see a change in approach.
Pango San has been the pointer person, as it were, for devising property market, and we know the word is that he has a more hawky stancer and the property regulation going forward, we do see him taking a more practical approach in dealing with the property market.
Despite that, Shi that, Chang Shu says, the appointment is broadly seen as an indication of policy continuity. Reaction in China's equity and credit markets was muted well.
US Treasury Secretary Janet Yellen will travel to Beijing later this week. She becomes the second member of Biden's cabinet to visit, after Secretary of State Anthony Blincoln's trip three weeks ago. The US Treasury Department it says Yellen will meet with senior Chinese government officials, without naming exactly who, but that Yellen would not meet President she Jingping as for a bilateral summers. President Joe Biden said in mid June that he anticipates meeting she in the next several months.
Okay, those are a few of our top stories for you this morning. A bit lighter though, of course. It's the start of summer in the UK. Wimbledon begins today. Absolutely tons of the expected to be eaten and Novak Djokovic, of course, the Serb is won twenty three Grand Slam titles. It's seen widely is the favorite in terms of Wimbledon. Yeah, it begins today.
Well, lots of interest to and Andy Murray and what's going to happen to him? Could this be his last tournament?
Yeah?
Poor man, so many helps pen in them every year.
Yeah, absolutely, and he has had an incredible career. And yet, of course with the replacements that he's had in the surgery meantly difficult. But then these champions are fighters, they are battlers. And Venus Williams is going to be at the tournament. She is forty three and playing. I mean, what a remarkable career.
Yeah, amazing. All right, Well, let's turn back to our top story this morning. Apple reportedly slashing production targets for its Vision Pro because manufacturers are struggling with the novel gadget's complex design. The Financial Time says the tech giant is now preparing to make fewer than four hundred thousand versions of the headsets, joining us to discuss as Bimber Quick takes Alex web Alex, good morning to you. What is the reported problem that Apple is facing here?
So, according to the FT's reporting, it's to do with the micro led displays, which are essentially inside the headset, that they have some issues with the yields. Something you quite often see with new technologies that of the number that come off the production line, a lower percentage of those are actually usable than Apple would like. It's what we saw actually with face ID when that was first
wrought to market a few years ago. So it's probably a relief in a sense that they weren't going for a massive you know, trying to ship fifteen million units in the first year. When you're just dealing with a few hundred thousand, the stakes a little bit lower. That's also perhaps one reason why they might have done it on that sort of scale.
Yeah, absolutely, So then is it a big blow for a kind of flagship product, Does it increase the anticipation the excitement about it, or how can we judge?
I mean, you might find actually that it kind of helps them because of scarcity sometimes is beneficial. And at this stage it wasn't likely to make any meaningful difference to the bottom warranteed the top line. In fact, it's probably going to be it's a good chance to be loss making in the first year. This is a flagship product in the sense of flagship announcement, but the iPhone is still the flagship product, right that is still the
thing that drives more than fifty percent of revenue. This probably the sales are like to be more than a rounding error. When it comes to Apples overall learnings, it's about laying the groundwork for what might be to come. And if you can get these devices into the hands of developers, that means they can start building the apps and services that would run on Vision Pro or perhaps Vision which might be the second generation at a slight lower price, so that when it does, in Apple's hope,
become a mass market product. There is a slew as a bevy of really compelling use cases that then drive a more widespread adoption.
This, of course, I was coming after Apple have that market milestone hitting three trillion dollar valuation last week.
Yeah, it's fascinating. The Apple machine just kind of churns on sort of no matter what. I feel as though that number was perhaps less directly to do with the vision pro than it was just Apple's ability to continue layering on services to the iPhone that not only give users and another opportunity to spend their money with Apple, but also ensure they have to keep returning and buy
the iPhone. If you've got an Apple card, if you've got an Apple Watch, if you've got AirPods, you know, if you spend all the money on those things, you're way less likely to be able to trade it in for an Android because you're so deeply tied into it. And that's really been the story of Apple under Tim Cook over the past few years. Yeah.
Absolutely, the wearable's business is husually important to them. Alex, thank you so much for being with us. Bloomberg quick takes Alex.
Web up next. Pimco's CEO warns of a harder landing and banks told to uphold free speech after accounts blacklisted.
Now the paper review on blue Bird Daybreak Europe. The news you need to know from today's papers.
I'm bloom Berkley and Goerren's is the studio with the details of those stories. Good morning to you, Leanne. Let's start with the Financial Times. The headline there bond fund giant Pimco prepares for harder landing for global economy.
Yes, indeed, Stephen, good morning to you. Pimco says markets are far too optimistic about central bank's ability to dodge a recession and this comes as a really battle inflation in the US and also in Europe. So speaking to the FT over the weekend was a CEO and he said he's preparing for a harder landing than other investors, while top central banked chiefs really continue their campaign of interest rate rises and we've obviously seen that here in
the UK the Bank of England raising rates. However, speaking to the newspaper, the CEO thinks of soft landing is
actually most likely for the US economy. So predicting that the firm owned by Germany's alliances favoring high quality government and corporate bonds right now at the moment, and Pimco's moved to safer bonds as really part of an industry shift that we're seeing towards higher quality fixed income assets, but really a warning their Carol line that we are too optimistic about the central bank's ability to dodge a recession and get inflation down. And this is all according
to the CEO of Pimco. Yeah.
Of course, Bloomberg was speaking to the CEO of Alians on Friday. Alians owns PIMCO, and so his comments to us were also pretty fascinating to layer in because he was talking about, yes, bonds are back, but it's all about flows. We've got a guess actually all on the program. He's going to be able to talk to us a little bit more about that a little bit later on. But the question is how much of the flows into bonds go into passive strategies or active strategies, you know,
how much into ETF, how much into active managers. But yeah, and so the soft landing idea sort of plays into that. But yeah, and very interesting conversation.
Let's go to the telegraph next. Lee and banks tolls to uphold free speech after accounts blacklusters.
Yes, indeed, Steve, And there was a lot about this over the weekend in the newspaper and the Chancellor, Jeremy Hunter said to be deeply concerned about bands on customers who hold controversial views. He's actually called on the City Minister, who's Andrew Griffith, to actually investigate the whole issue that is currently swirling around at the moment. White All sources say to the newspaper that the results of a consultation on the whole subject matter is to be published within
weeks now. This comes after it was launched earlier this year in the wake of PayPal blocking accounts of free speech groups. So consultation due in and the controversial really actually flared up again last week, and that was after the leading brexityer Nigel Farage revealed his account had been closed by his bank, saying he wasn't sure why this had happened and he had gone to many other high street lenders and couldn't seem to open another bank account.
Vica was also dropped as a customer after criticizing his lenders stance on LGBTQ plus issues. So there we are two people and the Treasury is poised to recommend a more rigid notice period if payment providers, including high street lenders, actually want to close a customer's bank account, as well as requiring banks to provide more information about why they
have decided to close these accounts. And that is something that Alex Wickham has written on the Bloomberg terminal about Nigel Farage and the controversy surrounding these closed bank accounts.
Yeah, I mean Faraj has been on television to talk about how this is serious political persecution at the very highest level of our system. So that's the sort of language that he's using. The bank apparently though, contacted him and it's about actually the fact that it is his business account that is being closed, that he still has
the option of opening a personal personal bank account. So it's a little bit I think more complicated than this, and also sort of around the bank's decisions around how they make those decisions around business accounts.
Actually, yeah, certainly an interesting story to monitor. Leanne The Times next warnings of summer travel chaos in Europe as air traffic controls expected to be overloaded.
Sounds familiar, Yes, very familiar flying to Europe this summer. Well, maybe you might be held up on the runway or you might face delays, and Eurocontrol warned passengers of a challenging period ahead, with high overloads of air traffic seen on most days in many important regions, including Marseille, Athens and Budapest. Now the Times is reporting this and this can result in delays and aircraft's being forced to take
these longer routes. And I can't believe there's but twenty five million Brits are expected to head overseas between right now and September, mostly by airs we get away on those summer holidays. Now, the director General of Eurocontrol, which does manage European air space, says this summer in Europe it's particularly challenging because there's less air space because of
the war in Ukraine and the military needs aviation. Bosses, including Michael O'Leary, the chief executive of Ryanair, also says there's a series of strikes by controllers in France, which remains one of the biggest threats to summer air travel. But I feel like every year we do get these warnings, so always arrive early, kind of expect to be delayed, which is annoying because I went away and I was
delayed because of NATO training in the air space. But these are things that happen, Caroline, so we've all be prepared.
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