WEBVTT - Deadly Plane Crash Near DC Airport; Tesla Earnings 0:00:02.520 --> 0:00:07.040 Bloomberg Audio Studios, podcasts, radio News. 0:00:07.720 --> 0:00:10.000 I want to get more on this with Kit Darby, 0:00:10.400 --> 0:00:14.000 President of Kit Darby Aviation Consulting on this, Kit, it's 0:00:14.000 --> 0:00:17.040 so interesting when we hear from officials that the helicopter 0:00:17.079 --> 0:00:20.040 crew was fairly experienced Sean Duffies and the craft was 0:00:20.079 --> 0:00:21.919 absolutely preventable. 0:00:22.320 --> 0:00:24.400 What are the questions that you have right now? 0:00:26.720 --> 0:00:29.880 Well, thanks for having me. The first thing, of course, 0:00:30.120 --> 0:00:34.559 the primary charge to pilots on both sides, both aircraft 0:00:34.560 --> 0:00:38.880 and helicopter and VFR conditions which you know without cloud 0:00:38.920 --> 0:00:42.360 you're able to see, is to see and avoid. So 0:00:42.960 --> 0:00:47.840 in this case, one complicating factor is that the communications 0:00:47.840 --> 0:00:51.160 to the helicopter and the airplane were on different frequencies, 0:00:51.200 --> 0:00:53.760 so the situational awareness would go down a little bit, 0:00:53.840 --> 0:00:57.040 especially for the airliner not knowing that the tower was 0:00:57.080 --> 0:01:01.920 talking to this other aircraft. The vision requirements, you know, 0:01:01.960 --> 0:01:04.840 seeing avoid means you can see. We've learned just recently 0:01:04.920 --> 0:01:09.160 that the helicopter was using night vision goggles. So those 0:01:09.200 --> 0:01:11.880 are designed to allow the helicopter to operate in a very 0:01:11.920 --> 0:01:17.119 low light situation without any extra illumination, but it also 0:01:17.240 --> 0:01:20.040 limits the field of vision and it has a tendency 0:01:20.120 --> 0:01:23.520 if you do get a bright light to bloom or 0:01:23.600 --> 0:01:27.200 to obscure what you're looking at. So at least one 0:01:27.240 --> 0:01:29.520 of the pilots in that aircraft, perhaps the one on 0:01:29.560 --> 0:01:32.000 the side of the airliner, since it came in from 0:01:32.000 --> 0:01:35.760 the side, could have had been using night vision goggles, 0:01:35.800 --> 0:01:38.280 could have had a vision problem. But even without the 0:01:38.360 --> 0:01:41.600 night vision goggles, we're looking at a light at night, 0:01:41.640 --> 0:01:43.800 So it's easy to see the light at night, but 0:01:43.880 --> 0:01:46.479 it's hard to tell what that light's doing, how fast 0:01:46.520 --> 0:01:49.840 it's going, where it's going, you know, climbing or descending. 0:01:49.880 --> 0:01:52.600 So that's a very difficult against the backdrop of city 0:01:52.680 --> 0:01:56.320 lights to know what you're seeing, either with or without 0:01:56.400 --> 0:01:57.160 vision goggles. 0:01:57.800 --> 0:02:00.240 Kid based upon your experience, how long do you think 0:02:00.280 --> 0:02:04.080 it will take the NTSB to figure out what happened 0:02:04.080 --> 0:02:06.280 and be able to communicate that to us. 0:02:08.080 --> 0:02:12.480 Well, if the voice recorder and the flight recorder are 0:02:12.560 --> 0:02:14.600 found and available, and I would expect them to be 0:02:14.680 --> 0:02:18.360 in good shape, we'll have a lot of information very quickly. 0:02:18.400 --> 0:02:21.200 That preliminary report should be accurate within a month or so, 0:02:22.360 --> 0:02:25.520 and then, of course the full report often takes a 0:02:25.600 --> 0:02:29.160 year or more. But the preliminary report with the information 0:02:29.240 --> 0:02:33.960 we have, video evidence, flight recorders, voice recorders, eyewitness reports, 0:02:34.240 --> 0:02:36.280 We're going to know what happened here pretty quick. 0:02:37.040 --> 0:02:37.639 As we. 0:02:39.160 --> 0:02:42.400 Turn towards Reagan reopening at eleven am. There have been 0:02:42.400 --> 0:02:44.679 a lot of questions from the press to officials, is 0:02:45.120 --> 0:02:48.840 it safe to fly? What kind of precautions in this 0:02:48.960 --> 0:02:51.680 kind of scenario would be taken to ensure that? 0:02:53.600 --> 0:02:59.360 Well, this is extremely rare, almost random. A reminder that 0:02:59.400 --> 0:03:03.560 we people regularly at six hundred miles an hour at 0:03:03.919 --> 0:03:08.000 thirty thousand feet coast to coast, twenty times safer than 0:03:08.040 --> 0:03:10.840 we drive ourselves to the airport at sixty miles an hour. 0:03:11.440 --> 0:03:14.640 So I mean this is a wonderfully safe system. Thirty 0:03:14.720 --> 0:03:18.120 million flights worldwide. Some of our major airlines have a 0:03:18.200 --> 0:03:22.480 million flights, one airline a million flights a year. So 0:03:22.560 --> 0:03:25.600 there is regrettably a big exposure when we have that 0:03:25.720 --> 0:03:30.840 much activity, and this particular airport very congested, all the 0:03:30.880 --> 0:03:35.280 military services, many of the airlines operating in very close proximity. 0:03:36.880 --> 0:03:39.400 You know, this would be a likely place for something 0:03:39.400 --> 0:03:42.440 to happen, But for another accident like this to happen 0:03:43.480 --> 0:03:47.720 very very rare, and certainly shouldn't discourage anybody from getting 0:03:47.720 --> 0:03:49.560 on an airliner and going where they need to go. 0:03:50.040 --> 0:03:53.800 The odds are, you know, below a lightning strike kit. 0:03:53.880 --> 0:03:55.960 I guess what I've learned this morning. I think a 0:03:56.000 --> 0:03:57.600 lot of our listeners and viewers have learned as well. 0:03:57.680 --> 0:03:58.320 Is a couple of things. 0:03:58.320 --> 0:04:01.240 One just how busy the DC airspace was. I just 0:04:01.280 --> 0:04:03.600 kind of figure, if it's not New York, La Atlanta, 0:04:03.680 --> 0:04:06.520 you know it's okay, But A it's very very busy. 0:04:06.560 --> 0:04:10.960 And B the mixture of commercial and military I kind 0:04:10.960 --> 0:04:14.320 of feel like makes DC airspace a little bit unique. 0:04:15.200 --> 0:04:17.880 How concerning is it or what precautions do you think 0:04:17.920 --> 0:04:21.160 are taken in that airspace? For again, military and commercial 0:04:21.160 --> 0:04:24.159 to be in such close proximity so often. 0:04:25.440 --> 0:04:27.560 Well, there are a lot of rules. I mean, I've 0:04:27.560 --> 0:04:31.240 flown military aircraft in that airspace, although I was flying airplanes, 0:04:31.320 --> 0:04:36.760 not helicopters, and it was very, very congested. However, there 0:04:36.800 --> 0:04:42.599 are rules that separate airplanes from helicopters, commercial from military, 0:04:42.960 --> 0:04:46.400 and those rules are followed every day, thousands of times 0:04:46.520 --> 0:04:50.280 very successfully. Something didn't work here, I mean the last 0:04:50.279 --> 0:04:52.200 thing they said was I have the aircraft in sight, 0:04:52.560 --> 0:04:54.680 and the question is how do you hit something you 0:04:55.440 --> 0:04:58.479 see and have agreed to avoid. I'm not sure the 0:04:58.520 --> 0:05:02.440 airliner would have had the helicopter in sight. But there's 0:05:02.480 --> 0:05:06.000 a real quandary here about We know the rules and 0:05:06.040 --> 0:05:08.640 the rules were being followed right up to the last minute, 0:05:09.000 --> 0:05:14.599 and then something broke down. So confusing for me, and 0:05:14.680 --> 0:05:17.760 I don't know that anybody could make sense of it yet, 0:05:18.160 --> 0:05:19.760 but soon, Kit, I think. 0:05:19.640 --> 0:05:22.039 For you and everybody else, also confusing. You've been in 0:05:22.080 --> 0:05:25.680 this industry for over thirty years. Can you give us 0:05:25.720 --> 0:05:28.360 some context. You gave great color in terms of what 0:05:28.400 --> 0:05:32.279 it's like to use night vision, different frequencies. How hard 0:05:32.360 --> 0:05:35.000 is it or easy is it to move a helicopter 0:05:35.200 --> 0:05:36.720 going one hundred miles per hour? 0:05:39.640 --> 0:05:43.680 It's pretty maneuverable. Helicopters do things that airplanes don't do, 0:05:43.760 --> 0:05:46.240 and that they can hover and go very slow. But 0:05:46.279 --> 0:05:49.840 when they're flying cruising, they're very much like an airplane. 0:05:49.920 --> 0:05:52.440 And both of these aircraft would be very maneuverable if 0:05:52.480 --> 0:05:56.760 they saw each other and understood the relationship speed, distance, 0:05:56.800 --> 0:06:00.120 what needed to be done. They're both very maneuverable and 0:06:00.160 --> 0:06:04.560 could have avoided each other with the right visual information. 0:06:05.440 --> 0:06:07.520 You know, I would e quate this the driving at night. 0:06:07.800 --> 0:06:10.080 How much less you see at night than you do 0:06:10.160 --> 0:06:13.120 in the daytime. And that's part of the problem here, 0:06:13.160 --> 0:06:15.560 I believe, is they're knowing what to do with what 0:06:15.600 --> 0:06:20.400 they see. Helicopter probably had the aircraft in site. Airplane 0:06:20.440 --> 0:06:22.480 probably did not have the helicopter in site. 0:06:23.440 --> 0:06:25.359 Very good, Kit, Thank you so much for joining us, 0:06:25.440 --> 0:06:29.640 Kit Darby, President Kitdarby dot Com Aviation Consulting, giving us 0:06:29.680 --> 0:06:34.680 some informed views and perspectives on aviation some of the 0:06:34.800 --> 0:06:38.760 challenges that might have been before these two aircraft as 0:06:38.920 --> 0:06:42.720 a unfortunately crushed in Washington, DC overnight. We'll have continued 0:06:42.760 --> 0:06:45.400 reporting on that throughout the day. Let's switch gears and 0:06:45.440 --> 0:06:47.640 get back to these markets again. The SP's up about 0:06:47.680 --> 0:06:50.679 sixteen points, the now's up sixty eight points, the nastacs 0:06:50.760 --> 0:06:53.960 up about seventeen points, so a slight lift to the market. 0:06:53.960 --> 0:06:57.359 Syviat Jablonski joint is. She's the CEO and CIO of 0:06:57.440 --> 0:07:03.240 Defiance E TFS. So yeah, we were coming off, you know, 0:07:03.360 --> 0:07:05.680 two great years in the stock market twenty three and 0:07:05.720 --> 0:07:08.800 twenty four with north of twenty percent total returns there, 0:07:10.320 --> 0:07:12.680 and we start off with a nice January in terms 0:07:12.720 --> 0:07:15.920 of performance here. What are you telling your clients these 0:07:16.000 --> 0:07:18.200 days about their expectations for twenty twenty five. 0:07:19.480 --> 0:07:22.360 Yeah, it's good morning. Well, I think twenty twenty three 0:07:22.360 --> 0:07:24.200 and twenty twenty four are going to be hard to beat, right, 0:07:24.240 --> 0:07:27.520 they're pretty epic years. But I do think though that 0:07:27.720 --> 0:07:30.280 you know, we're in a good position here economically. We 0:07:30.360 --> 0:07:33.160 have two to three percent GDP growth. You know, inflation 0:07:33.320 --> 0:07:35.520 is kind of coming down. Although we've seen some blips, 0:07:35.560 --> 0:07:38.760 it's arguably coming down and remaining steady at the moment. 0:07:39.720 --> 0:07:42.680 Jobs numbers are decent, the inflation figures that we've seen 0:07:42.720 --> 0:07:46.600 recently are pretty decent. Strong consumer, you know, corporate earnings 0:07:46.880 --> 0:07:49.360 are going to be interesting this time around, but thus 0:07:49.400 --> 0:07:51.600 far have been you know, strong in the last eight 0:07:51.680 --> 0:07:54.160 quarters or so, and so I think that we stay 0:07:54.200 --> 0:07:56.320 the course here, right. I think the last two years 0:07:56.360 --> 0:07:59.000 have proven to us that maybe it is time to 0:07:59.280 --> 0:08:01.680 get off of the sidelines. And you know, when you 0:08:01.760 --> 0:08:04.560 have like these these big dips like we saw from 0:08:04.720 --> 0:08:07.760 the Deep seek the Bacle the other day, you know, 0:08:07.960 --> 0:08:10.160 you kind of go in and your dollar cost average 0:08:10.200 --> 0:08:12.800 and these are your opportunities to be long equities and 0:08:12.800 --> 0:08:14.640 get performance. But to answer your question a little bit 0:08:14.640 --> 0:08:17.480 more specifically. You know, I don't expect a twenty percent year, 0:08:17.920 --> 0:08:21.520 but I do expect lower, lower double digit returns this year. 0:08:22.200 --> 0:08:25.680 What do you make of the market action moves on earnings? 0:08:25.720 --> 0:08:28.680 I mean, without talking specific names, I mean just the 0:08:28.840 --> 0:08:33.040 dropping ups. The drop in Microsoft like signa like it's 0:08:33.040 --> 0:08:35.320 not taking a lot to get really beat up. 0:08:35.360 --> 0:08:36.920 Can you put that into perspective for that? 0:08:38.160 --> 0:08:41.000 Yeah, I think it almost feels like last season, right 0:08:41.080 --> 0:08:44.480 where good news was a little bit of a drop, 0:08:44.720 --> 0:08:47.000 you know, neutral news was a really big drop, and 0:08:47.400 --> 0:08:50.120 anything that was shy of expectations was just like a 0:08:50.160 --> 0:08:53.040 complete tank, right. I think that the market just has 0:08:53.200 --> 0:08:56.440 very high expectations for earnings right now that are you know, 0:08:56.520 --> 0:08:59.600 somewhat unreasonable, right. I think we got a little bit 0:08:59.600 --> 0:09:01.760 of kind of like the fire and the tailwinds from 0:09:02.280 --> 0:09:05.280 AI and you know, kind of this this idea that 0:09:05.320 --> 0:09:06.960 the FED was going to be cutting rates and things 0:09:07.000 --> 0:09:09.000 like this. I think, you know, last year was super 0:09:09.040 --> 0:09:11.160 strong on that, and I think we're kind of setdying 0:09:11.160 --> 0:09:14.040 out now and so these earnings, particularly from the mag seven, 0:09:14.360 --> 0:09:16.320 they're going to start tapering off. I think we're going 0:09:16.360 --> 0:09:18.600 to continue to see positive earnings, but maybe it's not 0:09:18.640 --> 0:09:20.640 going to be you know, one hundred percent year over 0:09:20.720 --> 0:09:22.360 year on some of the names. Maybe it's going to 0:09:22.360 --> 0:09:25.880 be thirty percent year over year, which is still very solid. 0:09:25.880 --> 0:09:28.280 I think we just have to reframe our expectations on this. 0:09:29.080 --> 0:09:32.880 Sylvilly as CEO and CIO of Defines ETFs. Where are 0:09:32.880 --> 0:09:36.800 you seeing the flows into your ETF complex these days? 0:09:38.640 --> 0:09:41.720 Hands down, it's been in quantum computing. I would say 0:09:41.840 --> 0:09:44.720 that the two most popular traits were micro strategy, and 0:09:44.760 --> 0:09:46.439 that's really a crypto play, right, so you get a 0:09:46.480 --> 0:09:49.880 bitcoint exposure through that. But quantum computing has just been 0:09:50.880 --> 0:09:52.920 you know, an unbelievable. 0:09:52.280 --> 0:09:54.840 Story for our firm and for the markets. 0:09:54.880 --> 0:09:55.040 Right. 0:09:55.080 --> 0:09:58.360 I think it's this idea of like the next generation 0:09:58.400 --> 0:10:00.840 of AI, the fourth industrial revel lution. In order for 0:10:01.040 --> 0:10:04.280 machine learning and AI to actually work, you need supercomputers, 0:10:04.360 --> 0:10:07.120 and you know, quantum competing has this ability to kind 0:10:07.120 --> 0:10:11.679 of transformed that field. But also just you know, drug discovery, pharmaceuticals, 0:10:11.720 --> 0:10:15.079 medical research, cryptography, all of these different you know types 0:10:15.120 --> 0:10:19.800 of sectors that need essentially an upgrade with technology, and 0:10:19.840 --> 0:10:22.440 so a lot of those quantum names this year, like 0:10:22.559 --> 0:10:25.200 I on q Ricghetti, and I know that they've fallen 0:10:25.240 --> 0:10:27.400 back like post Judson Wog a little bit, but I 0:10:27.400 --> 0:10:29.120 think it's kind of back on the up and up 0:10:29.160 --> 0:10:31.920 because people realize that this is a technology that's going 0:10:31.920 --> 0:10:33.719 to blue and flourish. And we you know, we saw 0:10:33.760 --> 0:10:36.480 about a billion dollars of assets coming to that space 0:10:36.520 --> 0:10:38.880 and it's been out since twenty eighteen, and you know, 0:10:39.240 --> 0:10:40.840 it kind of did nothing and then that's where the 0:10:40.840 --> 0:10:41.720 flows came this year. 0:10:42.240 --> 0:10:43.360 Sylvia. We appreciate you. 0:10:43.400 --> 0:10:45.960 Thank you so much, Sylviaja Blonci, the CEO and CIO 0:10:46.080 --> 0:10:49.800 of Defiance E t FS. One of the most interesting 0:10:49.840 --> 0:10:52.400 stock moves I think I've seen is Tesla. That stock 0:10:52.520 --> 0:10:55.200 is up one point six percent despite numbers that were 0:10:55.200 --> 0:10:58.000 not great and any quality beat was a was a 0:10:58.480 --> 0:11:01.240 light quality beat, like it was a good quarter. 0:11:01.440 --> 0:11:04.360 Yet Elon musk job on that stock up on the call. 0:11:04.400 --> 0:11:08.000 Steve Man is Bloomberg Intelligence Global Autos and Industrials research analysts, 0:11:08.000 --> 0:11:10.120 and he joins us, Now, I don't get it. I 0:11:10.160 --> 0:11:13.720 do not understand what the takeaway is from Tesla's our names. 0:11:14.559 --> 0:11:16.920 Yeah, I think you know the volatility that you're seeing 0:11:16.960 --> 0:11:19.400 in stock this morning, it's I think a lot of 0:11:19.400 --> 0:11:21.760 the there's been a lot of noise in the marketplace, 0:11:21.880 --> 0:11:25.040 a lot of focus on the pass but as you know, 0:11:25.160 --> 0:11:28.040 the valuation of this company is really driven by AI 0:11:28.080 --> 0:11:32.160 and Robotaxi, and I think you know, Elon Musk basically 0:11:32.640 --> 0:11:37.079 backed up the truck and unloaded a lot of positive 0:11:37.440 --> 0:11:42.440 news about AI and about their future last night. You know, 0:11:42.480 --> 0:11:45.640 they're rolling out the robo taxi in June. We thought 0:11:45.720 --> 0:11:48.880 it will be two years away, but it's it's going 0:11:48.960 --> 0:11:51.840 to happen in June, starting in Austin, Texas, in California, 0:11:52.320 --> 0:11:55.360 and expanding it to the rest of the major part 0:11:55.400 --> 0:11:58.800 of the country into twenty twenty six. The other thing 0:11:58.840 --> 0:12:03.920 that was a prize was the Optimist humanoid robot. Now 0:12:03.960 --> 0:12:07.080 we didn't think that they're gonna start production of that 0:12:07.160 --> 0:12:10.720 robot anytime soon, but the plan is to do that 0:12:11.000 --> 0:12:13.400 later this year. And one of the things that they're 0:12:13.440 --> 0:12:15.520 going to use that for is really to help them 0:12:15.559 --> 0:12:18.760 cut costs in their production plans. 0:12:19.040 --> 0:12:22.600 Steve, could you explain the business model for the Robotaxi. 0:12:23.679 --> 0:12:28.000 Yeah, Initially, what they want to do is mimic what 0:12:28.040 --> 0:12:33.080 Weimo is doing. So they're going to produce robotaxis and 0:12:33.200 --> 0:12:36.360 they're going to be for higher the revenues will be 0:12:36.559 --> 0:12:39.400 generated and will go straight to Tesla, and then down 0:12:39.440 --> 0:12:42.560 the road they're going to open up to current Tesla 0:12:43.280 --> 0:12:47.040 vehicle owners and the plan is to do it like 0:12:47.120 --> 0:12:50.840 an Airbnb style where the owner actually can rent out 0:12:50.880 --> 0:12:51.880 those vehicles. 0:12:52.760 --> 0:12:53.320 When we talk. 0:12:53.240 --> 0:12:56.120 About the quality of any kind of beat, what was 0:12:56.120 --> 0:13:00.640 circulating in my world was the greenhouse gas gas emissions credits, uh, 0:13:00.679 --> 0:13:03.360 and that was a big reason why we saw the 0:13:03.400 --> 0:13:06.640 beat for Tesla. But that's easy to strip out, like 0:13:06.640 --> 0:13:08.720 at some point that goes away, it gets less. 0:13:08.720 --> 0:13:11.120 We don't need it. So what do you make of that? 0:13:11.920 --> 0:13:15.480 Uh? You know, they they've always been getting credits, so 0:13:15.640 --> 0:13:18.760 it's not anything new. But what really drove the lower 0:13:18.880 --> 0:13:22.080 margins in the fourth quarter is really the relaunch of 0:13:22.080 --> 0:13:25.520 the Model Y Juniper, the update of the Model Y. 0:13:25.559 --> 0:13:28.760 They're actually clearing out the inventory of the old Model Y. 0:13:29.200 --> 0:13:31.560 It's gonna they did that in the fourth quarter. It's 0:13:31.600 --> 0:13:33.600 you're gonna see some of that in the first quarter. 0:13:33.880 --> 0:13:36.400 So first quarter margins will be a little bit bumpy. 0:13:37.000 --> 0:13:42.720 But you know, they're they're increasing uh incentives, better deals 0:13:42.720 --> 0:13:45.720 on leasing just to clear out that inventory. But what 0:13:45.760 --> 0:13:49.480 we're hearing so far is uh. You know, anecdotally the 0:13:49.559 --> 0:13:52.959 you know, I think on the global level, China and 0:13:53.000 --> 0:13:55.400 in the US, there's been a high demand or a 0:13:55.480 --> 0:13:58.880 high order rate interest in the new model. Y. So 0:13:58.920 --> 0:14:02.040 we we we we are are positive and we are bullish, 0:14:02.200 --> 0:14:04.840 more bullish on that on that new product for next 0:14:04.920 --> 0:14:05.680 year and the year after. 0:14:06.640 --> 0:14:09.400 What is the AI play for Tesla stock? 0:14:10.840 --> 0:14:14.280 Well, look, if I stepped we step back a little bit. 0:14:14.320 --> 0:14:19.120 They're actually in the transition into a razor razor blade 0:14:19.160 --> 0:14:22.440 type of business model, right. I think you know, they've 0:14:22.480 --> 0:14:25.360 they've sold a lot of vehicles. They've been cutting costs 0:14:25.360 --> 0:14:27.800 on building cars so they can sell more and more 0:14:27.800 --> 0:14:32.239 of these vehicles. But the real revenue and profit generator 0:14:32.920 --> 0:14:35.960 is the AI is the robo taxi. It's the full 0:14:36.280 --> 0:14:41.280 uh full self driving platform. And we heard it last 0:14:41.360 --> 0:14:43.720 night from the company. You know, they're going to roll 0:14:43.720 --> 0:14:46.720 out robo taxi and it's it's sooner than I think 0:14:46.720 --> 0:14:48.640 a lot of people were expecting. 0:14:50.600 --> 0:14:53.280 How much of it do you think is the stock 0:14:53.360 --> 0:14:57.080 movement related to Musk's relationship with President Trump in DC 0:14:57.400 --> 0:14:59.720 versus underlying fundamentals. I realize that might be an unfair 0:14:59.760 --> 0:15:02.200 quiet to ask a stock analyst but just in terms 0:15:02.240 --> 0:15:05.040 of how you model the relative. 0:15:04.640 --> 0:15:10.360 A lot a lot, because it's I think it goes 0:15:10.400 --> 0:15:11.600 hand in hand part of this. 0:15:12.280 --> 0:15:12.560 Uh. 0:15:12.640 --> 0:15:15.200 You know, one of the things that again, the valuation 0:15:15.280 --> 0:15:17.640 of the stock is really on AI is really on 0:15:18.200 --> 0:15:23.160 pushing out the robo taxi and you know, with you know, 0:15:23.480 --> 0:15:27.520 now with Musk being you know, closer to the administration. Uh, 0:15:27.600 --> 0:15:31.280 the thinking is that you know, the the government is 0:15:31.320 --> 0:15:36.320 gonna actually deregulate or or make it easier for Tesla 0:15:36.480 --> 0:15:39.520 and and their rivals to actually roll out even more 0:15:39.600 --> 0:15:42.800 robo taxis uh, in in the in the country. 0:15:44.320 --> 0:15:47.680 So let's go back to the old car business. Any 0:15:47.720 --> 0:15:51.040 metrics there that stood out to you about cars? Actually, yeah, exactly. 0:15:51.120 --> 0:15:52.880 I hate to answer the question, but yeah. 0:15:52.920 --> 0:15:57.520 The question actually act actually there is I think the 0:15:57.600 --> 0:16:01.800 market is not picking this up, is not fully digesting this. 0:16:01.800 --> 0:16:06.720 This piece of news is that they actually is you know, 0:16:06.800 --> 0:16:08.960 once they roll out the model Y, once they roll 0:16:09.000 --> 0:16:14.080 out the cheaper, new, cheaper vehicle. Uh. This year, I'm 0:16:14.520 --> 0:16:16.920 hoping to drive higher volume. Their fixed cost is going 0:16:17.000 --> 0:16:20.920 to drop significantly. They just told us last night that 0:16:21.440 --> 0:16:27.040 you know, basically you know, using its existing line without 0:16:27.160 --> 0:16:30.920 new capex, They're going to able to actually produce thirty 0:16:31.440 --> 0:16:35.760 thirty three to thirty five percent more vehicles. Uh so, 0:16:35.760 --> 0:16:37.360 so they don't have to use that you know, they 0:16:37.360 --> 0:16:40.240 can actually conserve that cash and and spend it on AI. 0:16:40.600 --> 0:16:43.640 We're just like there yet basically we're not there. 0:16:43.640 --> 0:16:46.520 I think that when the volume comes up, increases from 0:16:46.560 --> 0:16:49.880 the new models, then we'll see the benefit of you know, 0:16:49.920 --> 0:16:53.800 that rationalization of their line and and and the reduction 0:16:53.880 --> 0:16:54.480 of capex. 0:16:54.520 --> 0:16:56.520 How close are we to getting that cheaper model that 0:16:56.840 --> 0:16:58.960 Paul wants to buy us? 0:17:00.160 --> 0:17:03.640 So far it's still uh, it's still on schedule for 0:17:03.840 --> 0:17:04.600 the first half of. 0:17:04.560 --> 0:17:08.080 This year, first half of this year. Do we believe 0:17:08.080 --> 0:17:12.960 that timeline? 0:17:13.160 --> 0:17:15.400 I mean, we haven't seen. The thing is, we haven't 0:17:15.400 --> 0:17:19.320 seen any pictures of it. Yeah, And I mean that's 0:17:19.480 --> 0:17:22.000 that's how Tesla has been doing. Like, for example, then 0:17:22.200 --> 0:17:24.359 launch of the new model why the redesign and Model 0:17:24.400 --> 0:17:27.719 hy they really really didn't show any pictures of it 0:17:27.880 --> 0:17:31.400 until really the last minute. And you know, they've they've 0:17:31.400 --> 0:17:34.320 been talking about it. They reiterated that last night, so 0:17:34.760 --> 0:17:37.120 you know, you know, my thinking is that they will. 0:17:38.240 --> 0:17:42.360 What's the thinking these days, Steve in the marketplace among investors, 0:17:42.359 --> 0:17:47.120 maybe even among TESLA about the demand curve for evs. 0:17:47.200 --> 0:17:50.240 Where kind of are we are we in momentum of 0:17:50.280 --> 0:17:52.120 the demand? What's the thinking out there? 0:17:52.800 --> 0:17:55.600 Yeah, there's a big debate. I think, you know, we're 0:17:55.640 --> 0:18:00.960 on on the camp of uh that you know, if 0:18:01.000 --> 0:18:04.159 the seventy five hundred dollars tax credit in the US 0:18:04.359 --> 0:18:07.919 is eliminated, Uh, there's still going to be demand for EV's. 0:18:08.000 --> 0:18:09.879 I think EV's are here to stay. They're still going 0:18:09.920 --> 0:18:12.080 to be demand for EV's, but it's gonna hurt some 0:18:12.119 --> 0:18:15.920 of the competitors that are not profitable in making EV's. 0:18:16.600 --> 0:18:21.040 So it may lead to example like Ford, you know, 0:18:21.320 --> 0:18:26.320 basically exiting kind of exiting the EV market, and we 0:18:26.440 --> 0:18:29.800 might see some of the the rivals do the same thing. 0:18:29.960 --> 0:18:33.560 For example, Volkswagen is actually not launching any more new 0:18:33.600 --> 0:18:37.199 EV vehicles in the in North America. So you know, 0:18:37.280 --> 0:18:40.680 if that's the case, you know there's potential that tests 0:18:40.800 --> 0:18:41.960 like a game more market share. 0:18:43.320 --> 0:18:45.280 Now that we've gone through a bunch of earnings for 0:18:45.359 --> 0:18:48.560 the automakers, GM in particular sort of highlighted the risk 0:18:48.600 --> 0:18:51.960 of tariffs on Canada and Mexico. Who do you think 0:18:52.080 --> 0:18:55.119 is best positioned in the car world to weather a 0:18:55.200 --> 0:18:55.959 tariff storm. 0:18:57.200 --> 0:19:00.720 I think for for the US automakers, any US amakers 0:19:00.800 --> 0:19:06.640 are more vertically integrated in the US will actually benefit. Look, 0:19:06.680 --> 0:19:09.600 it's gonna hurt everybody. Tesla is not immune to it, 0:19:09.880 --> 0:19:12.920 but it's all relative. I think. You know right now, 0:19:13.040 --> 0:19:17.480 Tesla doesn't build any vehicles in Mexico or in Canada. 0:19:18.240 --> 0:19:20.880 But you know the Big three do they and they 0:19:20.920 --> 0:19:22.680 do a lot of it in Mexico. 0:19:23.240 --> 0:19:25.440 All right, Steve, thanks so much. Appreciate that. Steve Man, 0:19:25.560 --> 0:19:28.720 auto analyst Bloomberg in intelligers talk about the Tesla earning. 0:19:28.720 --> 0:19:31.320 So let's go down to Washington, DC, the US Senate 0:19:31.359 --> 0:19:32.280 Select Committee