The leaders of Japan and China got off to a tense start but have made significant progress in turning around their relations in recent years.Asia Politicsread more
Tech's hottest IPOs of the year, including Beyond Meat and Zoom, dropped on Monday, falling more than the broader market.Technologyread more
Citi Private Bank says it has maintained an "overweight" stance on stocks in China, Hong Kong, Taiwan and South Korea.Asia Marketsread more
Stocks in Asia slipped on Tuesday, while investors looked toward a meeting between U.S. President Donald Trump and Chinese President Xi Jinping set to happen later in the...Asia Marketsread more
A week of dovish fireworks out of the central banking community has just gone by with most of the world's leading central banks now guiding towards easing in light of downside...Commentaryread more
"We do not seek conflict with Iran or any other country," Trump tells reporters in the Oval Office.Politicsread more
Chinese Vice Premier Liu He held a phone conversation with U.S. Trade Representative Robert Lighthizer and U.S. Treasury Secretary Steven Mnuchin, China's Ministry of Commerce...World Economyread more
Sen. Bernie Sanders announced a plan Monday to forgive the country's $1.6 trillion outstanding student loan tab, intensifying the higher education policy debate in the 2020...Personal Financeread more
While earnings usually come in substantially ahead of expectations — as much as 4 or 5 percentage points is not unusual — the downward direction in the outlook doesn't speak...Earningsread more
U.S. President Donald Trump's senior adviser Kellyanne Conway will not testify before the House of Representatives Oversight Committee this week on her alleged violations of...Politicsread more
"We missed being the dominant mobile operating system by a very tiny amount. We were distracted during our antitrust trial. We didn't assign the best people to do the work,"...Technologyread more
WHEN: Today, Tuesday, May 6th
WHERE: CNBC's "Squawk on the Street"
Following is the unofficial transcript of a CNBC interview with Bernard Arnault, LVMH Chairman & CEO. Following is a link to the interview on CNBC.com: http://video.cnbc.com/gallery/?video=3000272224.
All references must be sourced to CNBC.
CARL QUINTANILLA: OUR NEXT GUEST HAS TRANSFORMED THE LUXURY GOODS INDUSTRY DURING THE PAST 25 YEARS. LVMH'S 60 BRANDS COMPRISE WINES AND SPIRITS FASHION AND LEATHER GOODS, PERFUME, COSMETICS, WATCHES, AND JEWELRY. WITH ICONIC NAMES LIKE LOUIS VUITTON, DOM PERIGNON AND DEBEERS. BERNARD ARNAULT IS THE CHAIRMAN AND CEO OF LVMH, A MEMBER OF THE CNBC FIRST 25 LIST. HE JOINS US THIS MORNING FROM PARIS. BERNARD, CONGRATULATIONS AND THANKS SO MUCH FOR BEING WITH US. I WAS HOPING THAT WE COULD START BY TALKING ABOUT THE LATE '80S, WHEN THIS 25-YEAR PERIOD BEGAN. EVERYBODY IN THE WORLD THOUGHT JAPAN WAS GOING TO OWN THE PLANET EARTH. HOW DID YOU KNOW THAT LUXURY AS A CONCEPT WAS TRULY GOING TO GO GLOBAL?
BERNARD ARNAULT: WE DECIDED EARLY IN THE '80S THAT THERE WAS A LOT OF POTENTIAL WITH GLOBAL GROWTH TO SELL LUXURY PRODUCTS, AND MORE PRECISELY HIGH-QUALITY PRODUCTS. BECAUSE I THINK THE WORLD LUXURY MAYBE IS NOT COMPLETELY RELEVANT TO OUR INDUSTRY. WHAT WE TRY TO DO IS TO DO THE PRODUCTS OF THE HIGHEST QUALITY WITH A LOT OF ARTISAN, LIKE HAUTE COUTURE DRESSES THAT YOU SEE NOW, AND THE MARKET FOR THAT WAS EXPANDING, AS WELL AS LEVEL OF LIVING WAS GOING UP ALL OVER THE WORLD. AND THESE STRENGTHS HAS BEEN VERY STRONG SINCE THE '80S. SO TODAY, AFTER HAVING GROWN THE GROUP FOR THIS 25 YEARS, WE HAVE A PORTFOLIO OF AROUND 60 BRANDS. SOME OF THE BEST BRANDS, I THINK, IN THE WORLD.
ARNAULT: WITH PRODUCTS OF THE HIGHEST QUALITY.
QUINTANILLA: AND YOU'VE BEEN QUOTED AS SAYING AFFORDABLE LUXURY. THESE ARE TWO WORDS THAT DON'T GO TOGETHER. WE'VE SEEN SO MANY COMPANIES, MANY OF THEM PUBLIC NOW HERE AT THE NYSE, THAT HAVE TRIED TO EXPAND THAT MARKET BY CREEPING SLIGHTLY DOWN ON THE PRICE SPECTRUM. DO YOU NOT BELIEVE THAT'S A SUSTAINABLE MODEL?
ARNAULT: I DON'T THINK THE RESEARCH FOR QUALITY IS COMPATIBLE WITH LOWER PRICES. YOU HAVE VALUES, BUSINESS MODEL. OUR BUSINESS MODEL IS BASED ON CREATIVITY, INNOVATION, AND QUALITY. AND IN DOING SO, WE ARE ABLE TO REALLY CREATE A RELATIONSHIP WITH OUR CUSTOMER ALL OVER THE WORLD, WHERE MORE AND MORE ARE LOOKING FOR THE BEST PRODUCTS. AND IN DOING SO, WE ARE CREATING NEW PRODUCTS. WE ARE ALSO EMPLOYING MORE AND MORE PEOPLE IN OUR ATELIER – FOR INSTANCE IN FRANCE WHERE WE CREATE THESE FANTASTIC LOUIS VUITTON BAGS AND ALL OF THE HAUTE COUTURE DRESSES. AND THIS IS A TREND, I THINK, IS GOING TO STAY FOR THE NEXT TEN YEARS, MAYBE. AND I HOPE FOR A LONGER PERIOD OF TIME. SO THE SEARCH FOR HIGHEST QUALITY OF PRODUCTS IS GROWING. YOU KNOW, I OFTEN COMPARE OUR INDUSTRY TO OTHER FAST-GROWING INDUSTRIES. FOR INSTANCE, I HAVE A GREAT ADMIRATION FOR APPLE AND FOR THE iPHONE. I HAVE MYSELF AN iPHONE. BUT CAN YOU SAY THAT IN 20 YEARS PEOPLE WILL STILL USE AN iPHONE? MAYBE NOT. MAYBE WE'LL HAVE A NEW PRODUCT OR SOMETHING VERY MORE INNOVATIVE. BUT WHAT I CAN SAY TODAY IS 20 YEARS FROM NOW, I'M QUITE CONVINCED THAT PEOPLE WILL STILL DRINK DOM PERIGNON.
KAYLA TAUSCHE: BUT EVEN SO, SOME FORCES, BERNARD, OVER THE LAST 25 YEARS HAVE CHALLENGED THIS IDEA OF EXCLUSIVITY THAT HAS BEEN THE HALLMARK OF LUXURY. YOU THINK ABOUT EMERGING MARKET GROWTH, E-COMMERCE AND THIS NEW PURCHASING POWER OF THE MIDDLE CLASS. HOW DO YOU MAKE SURE THAT DOM PERIGNON, THAT LOUIS VUITTON HANDBAGS, THAT SOME OF THESE PRODUCTS THAT ARE THE HALLMARK OF THE LUXURY INDUSTRY, STAY UPMARKET, AS YOU SAY?
ARNAULT: YOU MEAN THESE PRODUCTS, ARE REALLY RESEARCHED FOR THEIR OWN QUALITY. AND THE FACT THAT PEOPLE WANT TO COME TO VISIT, FOR INSTANCE, A DOM PERIGNON SELLERS, OR THE FANTASTIC LOUIS VUITTON ON THE CHAMPS-ELYSEES IS A SIGN THAT THEY WANT TO BE IN CONTACT WITH THE HISTORY OF THE BRAND. AND THERE IS A LINK BETWEEN THE HISTORY OF A BRAND AND THE FUTURE OF THAT BRAND. AND I THINK IT'S A REASON WHY WE HAVE BEEN SUCCESSFUL, BECAUSE WE WERE ABLE TO BUILD ON SOME HISTORIC ROOTS THAT HAVE BEEN CREATED IN THE PAST AND THAT ARE PROJECTING THE FUTURE. AND THIS IS A REALITY THAT PEOPLE FEEL ALL OVER THE WORLD. AND MORE AND MORE SO, ESPECIALLY IN EMERGING COUNTRIES WHERE PEOPLE ARE MORE AND MORE EDUCATED. SO I THINK THE FUTURE IS STILL VERY POSITIVE FOR THESE VERY HIGH-QUALITY PRODUCTS. I'M NOT SAYING THAT FOR OTHER INDUSTRIES SELLING MORE AFFORDABLE PRODUCTS, THERE IS NO FUTURE. NO. THEY'RE DIFFERENT MARKETS. BUT FOR OUR TYPE OF INDUSTRY, FOR THE CREATIVITY, THE INNOVATION THAT WOULD BRING TO A VERY HIGH-QUALITY LEVEL, AND MIXING WITH THE HISTORY OF OUR BRANDS, I THINK WE ARE MATCHING DEMAND THAT IS GROWING ALL OVER THE WORLD.
QUINTANILLA: BERNARD, SPEAKING OF DIFFERENT MARKETS, HOW MUCH DO YOU WORRY ABOUT ONE PARTICULAR MARKET GOING INTO A SEVERE RECESSION WHERE LUXURY BUYERS WOULD START TO DISAPPEAR? I'M THINKING OF CHINA AS AN EXAMPLE. IS THAT SOMETHING YOU SPEND A LOT OF TIME WORRYING OR THINKING ABOUT?
ARNAULT: YOU KNOW, I THINK YOU SPEAK -- YOU JUST SAID RECESSION, AND SPEAKING OF CHINA. MY DEFINITION OF A RECESSION FOR A COUNTRY THAT IS GROWING AT 7% AROUND IS NOT A RECESSION. IT IS A FAST-GROWING COUNTRY. IF YOU TAKE EUROPE, EUROPE CERTAINLY IS NOT GROWING AS FAST. I THINK CHINA, I WOULD SAY, MAY HAVE SOME BUMPS OVER THE YEARS AND HAVE BEEN THROUGH VERY, VERY POSITIVE TREND FOR MANY YEARS, ECONOMICALLY, THE BUYING POWER OF THE CHINESE POPULATION HAS BEEN INCREASED DRAMATICALLY. AND I THINK WE'LL CONTINUE TO BE INCREASED IN THE YEARS TO COME. AND THE FUTURE FOR OUR INDUSTRY, FOR OUR PRODUCTS AND FOR OUR RENTS IN THAT COUNTRY IS STILL VERY GOOD. BUT AS ALWAYS IN CHINA, YOU HAVE UPS AND DOWNS, AND IN SPITE OF WHAT YOU CAN CONSIDER AS A LOWER LEVEL OF GROWTH, IT'S STILL GROWING VERY FAST. AND FOR US, WE ARE SEEING IN OUR ACTIVITIES IN CHINA, STILL VERY GOOD LEVEL OF DEMAND, AND THE LEVEL OF KNOWLEDGE FROM THE CHINESE POPULATION ABOUT QUALITY EUROPEAN PRODUCTS IS GROWING VERY FAST. SO IT EXPLAINS WHY THE BEST PRODUCTS ARE STILL VERY SUCCESSFUL IN CHINA, AND WILL CONTINUE TO BE SUCCESSFUL FOR THE NEXT FEW YEARS. THERE ARE A NUMBER OF CHINESE CITIES THAT ARE BECOMING IN THE STAGE WHERE THEY CAN BUY HIGH-QUALITY PRODUCTS, IT IS GOING TO GROW AND CONTINUE TO GROW FOR THE NEXT 10 OR 20 YEARS FOR SURE. SO I'M CONFIDENT ABOUT THE FUTURE OF CHINA.
QUINTANILLA: WELL, BERNARD, YOUR TRACK RECORD OVER THE PAST QUARTER CENTURY WOULD SUGGEST YOU KNOW WHAT YOU'RE TALKING ABOUT WHEN IT COMES TO THE FUTURE. OUR CONGRATULATIONS, AND OUR THANKS AGAIN TO YOU. BERNARD ARNAULT, THE CHAIRMAN AND CEO OF LVMH IN A RARE TELEVISION INTERVIEW.
ARNAULT: THANK YOU.
With CNBC in the U.S., CNBC in Asia Pacific, CNBC in Europe, Middle East and Africa, CNBC World and CNBC HD, CNBC is the recognized world leader in business news and provides real-time financial market coverage and business information to approximately 371 million homes worldwide, including more than 100 million households in the United States and Canada. CNBC also provides daily business updates to 400 million households across China. The network's 16 live hours a day of business programming in North America (weekdays from 4:00 a.m. - 8:00 p.m. ET) is produced at CNBC's global headquarters in Englewood Cliffs, N.J., and includes reports from CNBC News bureaus worldwide. CNBC at night is the all new CNBC Prime featuring a mix of new reality programming, CNBC's highly successful series produced exclusively for CNBC including "American Greed" and "Crime Inc." and a number of distinctive in-house documentaries.
CNBC also has a vast portfolio of digital products which deliver real-time financial market news and information across a variety of platforms. These include CNBC.com, the online destination for global business; CNBC PRO, the premium, integrated desktop/mobile service that provides real-time global market data and live access to CNBC global programming; and a suite of CNBC Mobile products including the CNBC Real-Time iPhone and iPad Apps.
Members of the media can receive more information about CNBC and its programming on the NBC Universal Media Village Web site at http://www.nbcumv.com/mediavillage/networks/cnbc/