Speaker 1: I'm Caroline Hyde at bloom Mug's wealth headquarters in Neil
Speaker 1: and id Ludlow at CS the Consumer Electronics Show in
Speaker 1: Las Vegas. This is a special edition of Bloomberg Technology
Speaker 1: coming up this hour. Tesla concerns they worsened as the
Speaker 1: automaker drops prices in China again. Investors call it a
Speaker 1: train wreck? Is it? Plus? Competition against Tesla ramps up
Speaker 1: as Mercedes Benz reveals plans to install thousands of ev
Speaker 1: Ultra fast charging stations globally, and Samsung posted a historic
Speaker 1: drop in profit as chip sales they plummet. We discussed
Speaker 1: the demand outlook with semiconductor giant Qualcom h CEO Cristiana
Speaker 1: arm On joins us. But first and foremost we get
Speaker 1: to those markets, and today was a day of macro,
Speaker 1: not micro. Today was a day of jobs data of
Speaker 1: non farm payrolls showing that basically've got a Goldilock scenario
Speaker 1: when it comes to the federal reserves. Eyeing of the
Speaker 1: jobs market, the SMP sergs more than two percent, the
Speaker 1: NASA having its best day in a month, and this
Speaker 1: is largely because we saw wage inflation. The pressures they're
Speaker 1: just staled back somewhat so still resilience in the job
Speaker 1: market to run a thirty two thousand jobs added, even
Speaker 1: though we keep talking about there's headlines and technology of
Speaker 1: job losses there this is not featuring at a federal
Speaker 1: macro level, and therefore we see a resilient job market,
Speaker 1: but a cooling in inflatory pressures. Two year yields absolutely
Speaker 1: dar back. Money palls in to the bond market as
Speaker 1: we think the Federal Reserve can take its foot off
Speaker 1: the gas when it comes to rate hikes. Let's slip
Speaker 1: it on again. Let's get into some of the micro moves,
Speaker 1: because amid there's joy in the market, we see some
Speaker 1: of the big tech moves move higher. Apple was the
Speaker 1: biggest mover in terms of points we're seeing up well
Speaker 1: four point six points, up almost four percent, but that
Speaker 1: really helped the benchmarks moved to the upside. It's once
Speaker 1: again worth more than two trillion dollars. First solo getting
Speaker 1: a bit. This isn't light of Wells Fargo saying it's
Speaker 1: one of their best ideas of three there's so a
Speaker 1: company surging one point eight percent, one of the best
Speaker 1: performers on the SMP and Biogen I want to shine
Speaker 1: a light from biotech for you today because the FDA
Speaker 1: giving it spread up approval of of course, the Alzheimer's drug.
Speaker 1: The biogenn is in partnership trying to tackle at the moment.
Speaker 1: So we're seeing up two point eight percent end, but
Speaker 1: really overall we want to dial it back to what's
Speaker 1: happening and sees what's happening on the floor, what's happening
Speaker 1: in terms of well in the car story. Really that
Speaker 1: is upon everyone's lips. It really does feel like a
Speaker 1: car show rather than electronic show. End. Yeah, it's day
Speaker 1: two here in Las Vegas, and evs are still top
Speaker 1: of mind, not just the announcements, but actually everyone is
Speaker 1: paying attention to Tesla A raising A drops as much
Speaker 1: as eight percent Friday. This is all about EV competition
Speaker 1: heating up in China, such an important market. Shares down
Speaker 1: after the company slash prices for its cars in China
Speaker 1: for the second time in three months, and then you
Speaker 1: look at its rival Burkes A halfway back to b
Speaker 1: y D raising prices and posting record sales. I'm so pleased,
Speaker 1: Caroline that Bloomberg's Kevin Tynan is alongside me here in
Speaker 1: Las Vega. Guess, of course, our Bloomberg Intelligence senior analysts
Speaker 1: for autos, you have a very clear view on this.
Speaker 1: This is a demand problem for Tesla, isn't it. Sure?
Speaker 1: Look and globally regionally, the auto industry is cyclical, and
Speaker 1: these TV makers, including Tesla, which is the oldest of all,
Speaker 1: just haven't been through this kind of demand earth um
Speaker 1: here or in China here. Money was easy and cheap
Speaker 1: for years, so we went through this period where evaluation
Speaker 1: goes through the roof because it's easy to afford vehicles,
Speaker 1: and this is the first time that these companies are
Speaker 1: really gonna be challenged. I should say that Tesla closed
Speaker 1: up almost three percent. It was down almost eight cent
Speaker 1: at one point. You know, the market's kind of making
Speaker 1: up his mind. But over the course of weeks, the
Speaker 1: downward pressure on the stock was about demand. It seems
Speaker 1: there's a competition angle. You know, you look at what
Speaker 1: Mercedes announced here. Uh, you know, focus globally, but also
Speaker 1: United States, in China. There are so many more players.
Speaker 1: Our investors kind of now waking up to the idea
Speaker 1: that Tesla is not the only game in town. I
Speaker 1: think so. And I think on top of that, I
Speaker 1: think the idea of EV adoption slowing is becoming a
Speaker 1: reality as well, um in terms of mining materials, who
Speaker 1: controls the materials, increased in prices of the materials, and
Speaker 1: then the real environmental impact of the technology providing the
Speaker 1: energy generation to power a fleet of electric vehicles like
Speaker 1: these are all things that through the period that is
Speaker 1: ending now really weren't talked about or considered as deeply
Speaker 1: as they are going to be now well said. And
Speaker 1: it's interesting that one of the co founders of Tesla
Speaker 1: went off to try and think about how you can
Speaker 1: recycle batteries, how you can make that more of an
Speaker 1: environmentally friendly means of driving. Kevin, I'm interested that at
Speaker 1: the same time as worrying about Tesla in China, while
Speaker 1: they're dialing back prices for Tesla, b y D just
Speaker 1: seems to be cleaning up. Of course, this as a
Speaker 1: company that's backed by the likes of Warren Buffett. How
Speaker 1: big is the pie getting of EV and how much
Speaker 1: is market share being eroded by other players in the
Speaker 1: space now? Yeah, Look and and ideally each of the
Speaker 1: regions if you look at North America, you look at Europe,
Speaker 1: and you look at China, the governments are essentially the
Speaker 1: wild card in terms of whether penalizing automakers for not
Speaker 1: doing more EVY or subsidizing the losses. And here in
Speaker 1: North America and US specifically, you know we don't. We're
Speaker 1: doing neither, right, We're we're incentivizing the consumer worth federal
Speaker 1: tax credits. Um. So you have a different demand profile
Speaker 1: and supply profile in each region based on how the
Speaker 1: government gets involved. And in China, you know, their push
Speaker 1: for adoption is much greater than it is even in Europe,
Speaker 1: and certainly more than it is here. So um, you're
Speaker 1: just going to get this kind of demand profile that
Speaker 1: we don't know over here, and that is being driven
Speaker 1: by penalties in Europe. All right, bloom beg inteligencies. Kevin
Speaker 1: tun is so good to hang out and pick your
Speaker 1: brain here in Las Vegas. Thank you. In a few
Speaker 1: minutes time, we're going to discuss the future of electric vehicles.
Speaker 1: We've mess ad is board member and CTO Marcus Schafer. Yes,
Speaker 1: so much more to discuss there and in fact, and
Speaker 1: as we dial back demand for autos, in fact, as
Speaker 1: we dial back demand well for anything that involves a chip.
Speaker 1: At the moment, semiconductors have been under some significant pressure.
Speaker 1: Just look at the quarterly profit coming from sam Summer Electronics.
Speaker 1: It was its initial profit forecast, and in fact it
Speaker 1: said it fell the most in more than a decade.
Speaker 1: Of course, it's a little bit of a sign in
Speaker 1: the global economic slowdown, and it's hurting electronics demand even
Speaker 1: more than many had actually expected, sometimes operating profit plunging
Speaker 1: sixty nine percent. To remember, this is the Bellweather of
Speaker 1: South Korea. It's its largest company, and Sundsung has kind
Speaker 1: of in grappling with weak demand for memory, cheap chips,
Speaker 1: smartphone starting back displays of course less in demand. It's
Speaker 1: all about what had been the pandemic ramp up ed
Speaker 1: and then this sudden are back. We see it whether
Speaker 1: it's the purchasing of these goods, and of course in
Speaker 1: many ways that's why we're seeing the reflection and people
Speaker 1: cutting jobs at these sorts of companies too. The dynamic
Speaker 1: here is is fascinating. Yes, there's just a complete drop
Speaker 1: in demand for d ram right, there's memory chips. Also,
Speaker 1: think about Apple, how difficult it was for Apple in
Speaker 1: the final month of two the worries around demand for
Speaker 1: Apple handsets and how there was such a revision for
Speaker 1: the four year number. Will remember, ironically, Apple is so
Speaker 1: important to Samsung's business as well from that memory perspective.
Speaker 1: So we're going to continue that conversation here in Las Vegas.
Speaker 1: Later this hour, we will discuss the chip outlook with
Speaker 1: Qualcom's CEO, Christiano am On Carrow, which is, you know,
Speaker 1: I can't wait because they are so key to that
Speaker 1: smartphone market as well, and he's actually managed to weather
Speaker 1: supply chains so well with the business and has remains
Speaker 1: pretty bullish throughout all of it. We'll see how he's
Speaker 1: talking about overall end demand at the moment. Meanwhile, coming up,
Speaker 1: so much more to be talking about. We've got more
Speaker 1: on cars. As I kept saying, this is kind of
Speaker 1: an auto show as well as electronics show. I'm going
Speaker 1: to exclusive conversation Marcus Schaefer Mercedes Benz Group as the
Speaker 1: car maker launcher's efforts to expand their own electric vehicle strategy.
Speaker 1: But first we also going to talk about and wearable
Speaker 1: tech continues to be a top trend. I know you're
Speaker 1: seeing at CS and it's only getting bigger. According to
Speaker 1: our CEO, Tom Hale. Just got to listen what he
Speaker 1: told it a little bit earlier in terms of the
Speaker 1: holiday season. We actually went into the Black Friday Cyber
Speaker 1: Monday with a price increase and we saw incredible unit
Speaker 1: volumes and incredible unit economics as a result. So we're
Speaker 1: actually bucking the trend, and I think that's part of
Speaker 1: a larger trends. Post COVID, people are much more aware
Speaker 1: of their health, of their wellness, how they're feeling. We've
Speaker 1: got a mental health crisis amongst teams. We've got people
Speaker 1: really starting to think about longevity and sleep is the
Speaker 1: foundation of all these things. And as a product, we've
Speaker 1: been spearing right into health right. We want to we
Speaker 1: want to extend from sleep into heart health. The American
Speaker 1: Heart Association just declared eight you know, sort of key
Speaker 1: factors in health. Sleep is one of them, and if
Speaker 1: you're getting bad sleep, you're gonna you know, you're gonna
Speaker 1: higher risk for cardiovascular issues, mental cognitive health. Alzheimer Parkin says,
Speaker 1: people are just much more aware of but now and
Speaker 1: that's really the tale when they're driving it. Yeah, there
Speaker 1: might be short term economic concerns, but what values your
Speaker 1: health priceless. I think was one of the best years
Speaker 1: in the car industry from the car makers perspective. I
Speaker 1: think supply is still limited and demand is still exceeding supplies.
Speaker 1: I don't see as a challenging year. From dort to
Speaker 1: Motiv perspective. That was the CEO there of Mobile I
Speaker 1: and here it's CS Las Vegas. Sustainability has been a
Speaker 1: big focus, not just for tech but also companies as well.
Speaker 1: This year's CS luxury car make a Mercedes Benz announcing
Speaker 1: plans to build a global network of ultra fast charges
Speaker 1: four evs, the first stations this year in North America,
Speaker 1: later expanding to Europe and then China. And I'm delighted
Speaker 1: to say, Caroline, they're here with more on the e
Speaker 1: V outlook from Mercedes Benz is their chief technology Officer,
Speaker 1: Marcus Schaefer. This is a real announcement, This is a
Speaker 1: real move by Mercedes to drive EV adoption, to drive electrification.
Speaker 1: Talk us through the timeline for rollout of this charging infrastructure. Well,
Speaker 1: this Mercedes branded globally charging infrastructure is complementing a roaming
Speaker 1: network which is currently existing UH and consisting of one
Speaker 1: million points, so it's a great addition to this network.
Speaker 1: The timeline to establish our own network globally in North America,
Speaker 1: Europe is starting twenty three and completion actually is planned
Speaker 1: by twenty twenty seven. My question is why are you
Speaker 1: doing this? You know you you have electric vehicle offerings
Speaker 1: in key markets. Do you think that this will be
Speaker 1: a driver of sales for those legacy Mercedes buyers who
Speaker 1: want to go electric I guess are concerned about charging.
Speaker 1: Why are you doing this? Well, if you are an
Speaker 1: EV driver and you know all about the experience and
Speaker 1: all the shortcomings range anxiety, but we want to provide
Speaker 1: two customers to all, must say the customers a real premium.
Speaker 1: Range anxiety is still an issue though absolutely absolutely. I
Speaker 1: mean despite we offer probably the best rangers in class,
Speaker 1: so just look at the eque as more than four
Speaker 1: hundred miles of range. That's phenomenal, But still looking at
Speaker 1: the market, I think still there's range anxiety. So to
Speaker 1: address this, we need a premium charging experience, and that's
Speaker 1: exactly what we're targeting. Let's look at some of your
Speaker 1: electric vehicles and let's look at ultimately demand for them.
Speaker 1: There's range anxiety, but there's also economic factors that player.
Speaker 1: At the moment markets you were perhaps ahead of what
Speaker 1: we're seeing on today. With Tesla. Tesla cutting its overall
Speaker 1: supplied to China, you had to do that back in November.
Speaker 1: What does the man look like for you globally and
Speaker 1: in specific, what is it like in China. Well, if
Speaker 1: I look at the global markets, there's a high increase
Speaker 1: and a production of Mercedes Pense EV vehicles. So the
Speaker 1: pace we are introducing and the growth rate we're having
Speaker 1: is more than one. Looking at the first nine months
Speaker 1: of twenty twenty two, so customers accepting our vehicles, so
Speaker 1: the introduction is just in full swing. So we are
Speaker 1: in the market with eight electric vehicles, which is probably
Speaker 1: the most comprehensive portfolio of evs in the market. And
Speaker 1: the first cars are entering the Chinese market in an
Speaker 1: interesting segment, the top end segment. Now we just we're
Speaker 1: in the course segment, starting in the course segment. Now
Speaker 1: we're entering into the top end segment, which is not
Speaker 1: existing at the moment, a segment over one million R
Speaker 1: and B which is a one hundred fifty U S dollars.
Speaker 1: That's an interesting segment. And now the first offering is
Speaker 1: there for Merced dispense the EQS electrics class interesting, so
Speaker 1: that our a luxury sort of price point is still
Speaker 1: their markets. But what about the middle and what about
Speaker 1: pricing pressure there? Well, it's a it's a market that's
Speaker 1: not a solid market yet, so there are always new
Speaker 1: players coming into the market. The ice market is very
Speaker 1: well established over a long time, but the EV market
Speaker 1: is very fragile at the moment, new players coming into
Speaker 1: So it's about content, customer acceptance and pricing and so
Speaker 1: the market is just getting in the balance at the moment.
Speaker 1: We surprised that you had to cut prices in China
Speaker 1: in in November of last year. Was that something that
Speaker 1: caught you off guard a Mercedes a little bit? Well,
Speaker 1: as I said, it's it's a new it's a new
Speaker 1: bracket that's coming together, so their new players entering it.
Speaker 1: So we were in this bracket for one million R
Speaker 1: and B started there and we did reposition the price.
Speaker 1: But still after repositioning, we are in the top not bracket.
Speaker 1: Still talk to us about adoption overall markets. We actually
Speaker 1: went to our own audience. We asked them in a
Speaker 1: poll on Twitter, at what point are they going to
Speaker 1: be getting into the e V space if they're not already,
Speaker 1: And actually in large part said they already owned one,
Speaker 1: but the majority said that they'll be buying one in
Speaker 1: three years plus, so they still need hearts and minds one.
Speaker 1: They still need perhaps the infrastructure that you're building out.
Speaker 1: But what also about do you need to meet from
Speaker 1: a supply side right now? Have you got the right talent,
Speaker 1: have you got the right software technicians at the moment?
Speaker 1: Are you managing to avoid any supply side problems coming
Speaker 1: down the pipe? Well, I think they are lots of challenge.
Speaker 1: You're starting from R material through battery assembly planned, but
Speaker 1: attacking all these elements and there really is through under
Speaker 1: sixty degree approach. So we're taking care about DR materials.
Speaker 1: So we're changing our sourcing activities, really taking care about
Speaker 1: DR materials, talking to mining companies, having off take agreements,
Speaker 1: establishing our own or joint venture cell factories or battery
Speaker 1: assembly plans, and converting all production and global assembly plants worldwide.
Speaker 1: So we are in the midst of completing basically this
Speaker 1: um This really is three under sixty degree approach here,
Speaker 1: and the one missing point was the charging infrastructure. So
Speaker 1: now you have it all starting from raw materials up
Speaker 1: to charging. Really in the comprehensive to under sixty degree.
Speaker 1: That was a big commitment on charging software. I want
Speaker 1: to talk to you about Formula one, but we can't.
Speaker 1: Not today another time Formula one, but talks me about software.
Speaker 1: It's competitive on the hiring side. You look at some
Speaker 1: of your peers, VW had some challenges with software. Do
Speaker 1: you feel happy with where you are with talent, with
Speaker 1: the timelines for development for the platforms that are in
Speaker 1: work sorts me about software, Well, we're absolutely happy. So
Speaker 1: we just completed hiring or three additional software engineers and
Speaker 1: actually the company is very attractive and so we had
Speaker 1: really no issue attractive talent, the best talent on the
Speaker 1: software site. So right now we're establishing our own operating
Speaker 1: system MBO as we call it. It's a chip to
Speaker 1: cloud software actually, and it's on track. So we're going
Speaker 1: to market in twenty five actually, and even in the
Speaker 1: next class coming out this year, we will have the
Speaker 1: first glimpse of how this operating system will look like.
Speaker 1: So there's great software talent on board, and as we
Speaker 1: were able to show here at cs OR, is the
Speaker 1: first idea what this software will deliver in terms of performance.
Speaker 1: I've got to ask you about autonomy level three you've
Speaker 1: received the permit for Nevada or inside California maybe this year.
Speaker 1: Do you think that that will happen. Oh, we are
Speaker 1: actually really really hopeful that that's going to happen soon. Actually, so,
Speaker 1: the d m V of Nevada approved our application. That's
Speaker 1: a great step moving from level to lever the three.
Speaker 1: We call it the moon lendings that first time, really
Speaker 1: responsibility is taken over by d vehicle itself, if not
Speaker 1: by the driver anymore, and no hands and no eyes
Speaker 1: on the road anymore. But still, of course safety is
Speaker 1: a keute element for us. As going to say, dispense.
Speaker 1: Marcus Schaeffer has been so great speaking to you, Mercedes
Speaker 1: Ben's chief technology officer, say well, enjoy the rest of
Speaker 1: CS interesting will be speaking much more with qual Calm
Speaker 1: about autonomous driving and the technology behind it. So movement.
Speaker 1: When it comes to ft X, Behamian and US officials
Speaker 1: overseeing the bankruptcy of the Crypto Empire have actually struck
Speaker 1: a deal. They're going to work together. They're going to
Speaker 1: end most of their legal disputes. Now this comes at
Speaker 1: a time while the ripple effects of f t X
Speaker 1: are going far and wide. We've got to focus in
Speaker 1: on silver Gate, the key lender to many crypto firms.
Speaker 1: It too continues to plummet. Let's talk about the share slide,
Speaker 1: about the implications of bluemosh Yang following the FTX implosion
Speaker 1: and the contagion effects. Silvigate such an important player when
Speaker 1: it comes to the crypto ecosystem and basically saw a
Speaker 1: run on the bank, but for quite different reasons, and
Speaker 1: we usually expect for a run on the bank. Yes,
Speaker 1: so silver It's really one of the most important bank
Speaker 1: in the crypto space because it provides banking services um
Speaker 1: deposit services to companies in the cryptal industry, which is
Speaker 1: historically kind of cut off from the rest of the
Speaker 1: banking system. And silver Gate really made a name for
Speaker 1: themselves as being this very essential provider of banking services
Speaker 1: to crypto players and it benefited over the years when
Speaker 1: the crypto market was in a ball round. But now,
Speaker 1: as we know, one of their biggest client was FTX,
Speaker 1: which is in trouble. And then there are other depositors
Speaker 1: who are mostly concentrated in the cryptal industry are also
Speaker 1: pulling out assets and deposits from the bank and hence
Speaker 1: we saw this run off a Bank for Sewergate, which
Speaker 1: is very different from the other run of banks UM
Speaker 1: that we've seen historically during the Great depressions, for example,
Speaker 1: what's extraordinary is that it survived it It survived an
Speaker 1: eighty billion draw down, a basically pulled down on deposits.
Speaker 1: What it isn't surviving so much is investors confidence. In particular,
Speaker 1: Kathy would Well known for buying the dip, has not
Speaker 1: bought the dip on silver Gating. Fact, they sold out
Speaker 1: almost entire mentality of their steak. What what's investor sentiment
Speaker 1: like around this name? UM The investors still have great
Speaker 1: doubts about the future of the company. I think super
Speaker 1: is a really unique name in the market in the
Speaker 1: sense that is really doubling down on crypto. There are
Speaker 1: other banks that are friendly with crypto, for example Signature
Speaker 1: Bank that are starting to scale back their exposure to
Speaker 1: the cryptal industry. But for silver Gate, they talk about
Speaker 1: how there's they're still deeply committed to serving the cryptal clients,
Speaker 1: and that of course introduced great uncertainty for its future
Speaker 1: because there's all the regulatory overhand, and there's also the
Speaker 1: the market conditions that's not looking good for crypto and
Speaker 1: therefore analysts are worrying that the run of the bank
Speaker 1: will still continue for Silvergate. The UK readio story yesterday
Speaker 1: about the worst case scenario. Are we add a worst
Speaker 1: case scenario with all this crypto concern um sally UM.
Speaker 1: I think there's still significant concerns in the industry UM
Speaker 1: for some of the remaining big players. UM. This week,
Speaker 1: for example, Genesis, we solved further lay off for the company,
Speaker 1: and then we're still looking for more updates from both
Speaker 1: Genesis and the parent company d C g at. Their
Speaker 1: both just big important players that in the crypto industry
Speaker 1: that historically played an important role building up the industry
Speaker 1: for others. So UM, there's more to see for sure.
Speaker 1: Besides the companies that are already in the bankruptcy court.
Speaker 1: Yu Chiang has been continuing to follow the fallout. We
Speaker 1: thank us so much for it from Blomberg News. Meanwhile,
Speaker 1: of course, many of sort of rift that you maybe
Speaker 1: you're getting out of crypto and you're going into the
Speaker 1: new big talked about space, which is AI artificial intelligence,
Speaker 1: and there's some latest news on that because we're all
Speaker 1: talking about chat, GBT and some of the generator AI.
Speaker 1: But New York City public schools have taken we'll aim
Speaker 1: at this. They're banning its students from accessing chat gbt
Speaker 1: on its networks, on its devices, saying, look at the
Speaker 1: chat gybt, which is called an open AI program for
Speaker 1: generating text, and some speculate could be used to cheat
Speaker 1: on essays or other assignments. And the public school system
Speaker 1: is therefore saying, look, they're worried about safety, about accuracy,
Speaker 1: and actually more about well creation, creativity, about intelligence in
Speaker 1: the way in which children youth build it. And this
Speaker 1: of course was something immediately that people thought about when
Speaker 1: they started playing with this particular program. Is that, boy,
Speaker 1: where's content editing going to go? Where's copyrighting going to go?
Speaker 1: Where is the ability to be able to mark the
Speaker 1: students essays? I just find it astonishing how quickly we
Speaker 1: went from brand new, exciting tech to plagiarism, and how
Speaker 1: many column inches already written welcome back to Bloomberg Technology.
Speaker 1: I'm Caroline Hide in New York with Ed Ludlow, who
Speaker 1: is out in a very busy Las Vegas. Said, Yeah,
Speaker 1: there's a lot going on right you. You get caught
Speaker 1: up in the moment here. You can't ignore what's going
Speaker 1: on globally. There are macroeconomic concerns, but a report from
Speaker 1: Bloomberg Intelligence says US Machinery three sales and earnings may
Speaker 1: prove more resilient than previously thought. We've had all kinds
Speaker 1: of announcements here and so I'm delighted how we're joined
Speaker 1: by Zeeman's US CEO, Barbara Humpton. Barbara, let's start with farming.
Speaker 1: I didn't expect you, of all people, to come to
Speaker 1: Las Vegas and talk about vertical farming. Please explain, well,
Speaker 1: who knew that actually the agriculture sector is adopting digital
Speaker 1: in a big way. And today's Semens and eight Acres
Speaker 1: announced our partnership we've made. What is the partnership. Eighty
Speaker 1: Acres is a vertical farming outfit to entrepreneurs in the
Speaker 1: food industry decided there's got to be a better way
Speaker 1: to get healthy food to people and eliminate the long
Speaker 1: logistics supply chains that actually result in less nutrition. What
Speaker 1: they've discovered is that with vertical farming they can produce
Speaker 1: three hundred times the produce from a single plot of
Speaker 1: land than would be possible outdoors. And and they're using
Speaker 1: Siemens technology to make that happen. Well, want to ask
Speaker 1: you about this technology. You know when people hit hit
Speaker 1: the name Siemens, they think all kinds of things, electronics,
Speaker 1: industrial equipment, healthcare equipment. Which part of your business is
Speaker 1: it that is making this happen? You know what? This
Speaker 1: is an all of the above, and we've actually been
Speaker 1: engaged in so many ways. It was our Siemens Financial
Speaker 1: services that first identified the company and made the investment.
Speaker 1: Then it was our digital industries team bringing the software
Speaker 1: and hardware to help ad acres control their they're growing process.
Speaker 1: Then we discovered that they needed the help of our
Speaker 1: smart infrastructure team because the building envelope actually there. They
Speaker 1: have sustainability goals. So here's a farm that uses n
Speaker 1: water less water than than regular farming, and so it's
Speaker 1: a sustainable solution using all of Siemens. Now I say
Speaker 1: it's all of the above because think about healthcare. Do
Speaker 1: you know food is medicine and this is a team
Speaker 1: that is now figuring out how to engineer crops so
Speaker 1: they can deliver the nutrients we need to actually combat disease.
Speaker 1: Is interesting. In the end of your press release, you
Speaker 1: then push it forward to the future. You talk about
Speaker 1: the R and D on you talk about Zemen's technology,
Speaker 1: about AI machine learning, how that's going to optimize plants
Speaker 1: in the future in this macro environment. How much is
Speaker 1: Zeeman still willing to be committing capital to R and
Speaker 1: D to the future when we're so worried about the
Speaker 1: here and now. Oh No, Siemens has a long history
Speaker 1: of investment in R and D because we know we
Speaker 1: can't sacrifice the future. And so what we're doing with
Speaker 1: adi Acres is yes, partnering them on the research and development.
Speaker 1: The big issue that we're trying to work on now
Speaker 1: is how to scale. It's one thing to be able
Speaker 1: to put up a single farm, and they have done
Speaker 1: so in seven cities around the United States. It's another
Speaker 1: thing to then make that i P available to others
Speaker 1: who might want to establish their own farms, and then
Speaker 1: bring that technology into the hands of others who can
Speaker 1: make use of it. Talk to us about there. For ultimately,
Speaker 1: we are a world, not just the nation hit with inflation.
Speaker 1: We're worried about access to food, particularly when you think
Speaker 1: of European issues, particularly a war and between Russian and Ukraine,
Speaker 1: the impact that's had on agriculture. More broadly, how are
Speaker 1: you as a as an executive, as a leader of
Speaker 1: an enormous business, thinking about the macro headwinds, about inflationary environment,
Speaker 1: about the labor marketing, feeling positive or a little bit
Speaker 1: more worried. Well, of course we have to be. These
Speaker 1: are grave times where we have to be very realistic
Speaker 1: about the situation we're dealing with. But we also have
Speaker 1: to understand that these moments of disruption give us the
Speaker 1: best opportunity to shape the future. So what we're doing
Speaker 1: at Siemens, we are a company with technology that transforms
Speaker 1: the every day. We're in the backbone of economies around
Speaker 1: the world. So what we're doing is working with our
Speaker 1: customers to make sure that we're helping them meet the
Speaker 1: needs of their local customers in order to help people
Speaker 1: get through this and actually thrive. I believe that what
Speaker 1: we're going to get through this disruption is some new modes,
Speaker 1: some new business models, some new ways of delivering products
Speaker 1: and services. I'll say at the edge, where we've been
Speaker 1: able to bring technology out to as nearly mechanical questions. Indeed,
Speaker 1: our layoffs on a reality for a company like you,
Speaker 1: not at Semens. Right now, the situation we're in is
Speaker 1: that our backlog is huge. I don't know if you've
Speaker 1: seen the numbers, but in two we had an absolutely
Speaker 1: stellar year, and so at the moment, we're working hard
Speaker 1: to meet our customers existing require this. In fact, I
Speaker 1: have opened I have job openings across the US, and
Speaker 1: so I'm hoping that people will come to our website
Speaker 1: and let us know if they're interested. And I do
Speaker 1: think the overall it's an interesting point you make, asking
Speaker 1: straight on about jobs, and I'm interested, Boba mole. Probably
Speaker 1: about your clients. What do you you said, You're really
Speaker 1: your focus is to help clients with their own supply
Speaker 1: chain keeping things local. Are you fitting your client saw
Speaker 1: in expansion mode or contraction mode? Well, here in the US,
Speaker 1: Siemens is making expansion plans. You would have seen last year.
Speaker 1: We made the commitment to build e V chargers of
Speaker 1: a million of the chargers over the next four years,
Speaker 1: and we have new operations going up in Texas, for instance,
Speaker 1: in addition to what we already had in South Carolina
Speaker 1: and in California. But in addition to that, we're looking
Speaker 1: forward to expanding other portions of our operations because quite frankly,
Speaker 1: with the investment being made in the American economy right now.
Speaker 1: We see investors going big here on that. And I
Speaker 1: can ask you about software. You know, you made this
Speaker 1: kind of software push in the US. I want to
Speaker 1: know about the success of the accelerator. I want to
Speaker 1: know about integration with Brightly. Can you just give us
Speaker 1: a quick update on that? Absolutely? Yeah, rightly. How fun
Speaker 1: a North Carolina business that's been brought into our smart
Speaker 1: infrastructure business and so they now have access to the
Speaker 1: full portfolio of customers that Siemens has across the country
Speaker 1: and around the world. So that integration is going well.
Speaker 1: We're continuing with additional software investments. We are absolutely working
Speaker 1: closely with the US government because of course these deals
Speaker 1: get a lot of scrutiny these days, but I'm happy
Speaker 1: to say the US government has been seeing Siemens as
Speaker 1: a good, responsible owner for these businesses. All right, Well,
Speaker 1: perhaps more deals to be announced, Carroy, Siemens US CEO,
Speaker 1: Barbara Humpton, thank you very much. Now, finally some good
Speaker 1: news for the airline industry. Delta is now offering free
Speaker 1: WiFi for all passengers. Earlier I spoke with Delta CEO
Speaker 1: Ed Bastion about the News. This is about giving our
Speaker 1: customers something that they've been asking for and wondering about
Speaker 1: for years, why don't they have it? And we also
Speaker 1: know that there's no place in the world you pay
Speaker 1: for WiFi except on an airplane, and then we needed
Speaker 1: to fix that. You and I were here in and
Speaker 1: a lot of this is coming full circle. It seems
Speaker 1: like as part of your big tech plan, you are
Speaker 1: gonna have to make further investments. But talk us through
Speaker 1: those investments, the in cabin tech that you're going to improve,
Speaker 1: and is there a dollar value that you can put
Speaker 1: around all of this. Well, we've invested a bill over
Speaker 1: a billion dollars the last few years just to bring
Speaker 1: the free WiFi to our customers with Vice at that
Speaker 1: we're launching that because it's not just the satellites that
Speaker 1: you pay for, but it's also the equipment, the routers,
Speaker 1: the downtime on plane. So it's been a pretty significant
Speaker 1: technology investivating its own right. Secondly, we're going to be
Speaker 1: bringing more than just WiFi. We're gonna be we also
Speaker 1: introduced Delta Sinc. Which is going to be a broader entertainment,
Speaker 1: experiential channel that when you're on board Delta we have
Speaker 1: exclusive partnerships who A Mobile, American Express and Paramount Plus
Speaker 1: to bring quality experience that you can only get on
Speaker 1: Delta aircraft and not on the ground. The other thing
Speaker 1: that we did over the last several years, which again
Speaker 1: we talked about three years ago at CS, was the
Speaker 1: airport and ground experience. We have opened the new l
Speaker 1: a X facility, the new Laguarity facility, the new Salt
Speaker 1: Lake City facility, the new Seattle facility, a head of
Speaker 1: schedule on all those projects because we put the pedal
Speaker 1: down during COVID. Once we realized that we were going
Speaker 1: to be stable and make it through, we accelerated the
Speaker 1: push to get this work done, and so we're actually
Speaker 1: a couple of steps ahead of where I even thought
Speaker 1: three years ago would be. Interestingly, it's kind of a
Speaker 1: tough one, isn't it. Add I don't know if I
Speaker 1: want to have great WiFi on a flight, because I
Speaker 1: kind of enjoyed the whole non contactable element to all
Speaker 1: of it. But then we do need to work the
Speaker 1: frustration around paying a whole load of money and it
Speaker 1: also not really working that efficiently. It's good to see
Speaker 1: that if someone's trying to get ahead of the curve.
Speaker 1: It feels as though everyone's gonna have to follow. See. Yeah,
Speaker 1: it's interesting. It is the first move and he promised
Speaker 1: the speeds will be faster than even in the room.
Speaker 1: He gave the presentation in here at ces A Bastions
Speaker 1: a tech savvy guy, and I asked him, do you
Speaker 1: need to hire more tech talent? He was like, nah,
Speaker 1: I think we've got this. Yeah, they recently needed that
Speaker 1: sixty million funding around for job as well. So really
Speaker 1: trying to double down on investment in tech mean, well,
Speaker 1: we'll go double down more on your technology information coming
Speaker 1: from Calcolm, we're going to talk well satellites and chips.
Speaker 1: In that conversation to Pole and CEO how he navigates
Speaker 1: what is perhaps some concerns about end demand. This is
Speaker 1: bring back so earlier we talked about how Samsung posted
Speaker 1: a historic sixty cent drop in profit as chip demand
Speaker 1: drops worldwide, but how a competitors like Qualcom going to
Speaker 1: avoid the same fate. But luckily CEEO Christian Ammon is
Speaker 1: here with me in Las Vegas. I actually want to
Speaker 1: kind of start on the news of the day, which
Speaker 1: kind of answers that question. A deal with a Radium
Speaker 1: to bring satellite based messaging technology finally into the real world.
Speaker 1: I don't mean to cause offense, but we've been waiting
Speaker 1: for this kind of thing for a long time. Yeah. Well,
Speaker 1: we're very excited about it. By the way, it's good
Speaker 1: to see you, happy to be here. Uh, we're very
Speaker 1: excited about this announcement with a Redium. But I think
Speaker 1: I needed to probably step back and tell what he means.
Speaker 1: We work with them for over two years to really
Speaker 1: design this technology. They could leverage their satellite network in
Speaker 1: a regular phone. It's the regular phone firm factor, not
Speaker 1: a specialty satella device, but that whenever you wore in
Speaker 1: the globe, you have the ability to be connected and
Speaker 1: send a message to anybody you want. And I think
Speaker 1: it's about redefining connectivity for Qualcom snap Dragon to say
Speaker 1: you are gonna be connected period, that is that it
Speaker 1: stops at the phone or do you see a business
Speaker 1: case where you can use satellite connectivity in other forms
Speaker 1: and devices electronics? Great question. So the way we're thinking
Speaker 1: about this, and I think it's the beginning of a
Speaker 1: new era when satellite communication is going to be added
Speaker 1: to phone. So the way you think about communications. Every
Speaker 1: phone and every other device have seller have WiFi, and
Speaker 1: now you get at said com and we're talking about
Speaker 1: some very interesting use cases. For example, we're taking this
Speaker 1: technology as well to laptops. So a laptop even if
Speaker 1: if it needs to send a message to the I
Speaker 1: T Department or vice versa to unlock cars. Think about
Speaker 1: your have a car and there's an airbank deployment. It's
Speaker 1: an important message you need to get out there's an
Speaker 1: air airbank deployment. Or how you put on the map,
Speaker 1: how you can look at a car, how you can
Speaker 1: find a car. So and I think it's just the
Speaker 1: beginning of a number of applications. I think this sort
Speaker 1: of sums up your tenure in so many ways. Christianity. One,
Speaker 1: you have come on and you've told investors again and
Speaker 1: again we are more than just smartphones. We are more
Speaker 1: than just laptops. We are about automotives, We are about
Speaker 1: getting into new types of devices. Is that the answer?
Speaker 1: How is that currently going to weather? What is basically
Speaker 1: a warrior around end demand four things like smartphones. Look,
Speaker 1: we are very proud of the company diversification strategy, and
Speaker 1: we said correctly we're going to be sequalk on technology
Speaker 1: and alter you see qualking technologies, the brother IoT when
Speaker 1: when I think about c E s uh. This has
Speaker 1: been an outer show for us. We have five major
Speaker 1: announcements and I'll started with something which is people didn't
Speaker 1: expect other qualcoms. We unveil a concept car and people
Speaker 1: will say what Qualcom a concept car and we're basically
Speaker 1: showing what's possible with this technology when you think about
Speaker 1: the car connected to the cloud, the snapdrag condition of
Speaker 1: cockpit in a in autonomy. We also announced um that
Speaker 1: we have a partnership with Salesforce because car companies now
Speaker 1: with all of those beautiful screens and all this connectivity
Speaker 1: to the cloud, are going to be talking to their
Speaker 1: customers all the time, not only when you go to
Speaker 1: the dealership, so all of a sudden you need to
Speaker 1: do CRM. In depart we announced there were in a
Speaker 1: second generation autonomy chip. We announced that we now have
Speaker 1: ability to bring ad s to enter level cars. So
Speaker 1: we're very proud of all the progress the company is
Speaker 1: doing in Alto. And yet Christiano end demand for cars
Speaker 1: is under pressure. We see that with Tesla's concerns surrounding
Speaker 1: that business. At the moment, we've got concerns around end
Speaker 1: demand for so many products. Give us your macro perspective,
Speaker 1: your bird's eye view. When will we start to see
Speaker 1: a pickup in demand? When are you seeing a weathering
Speaker 1: of this carent economic storm. Okay, And that's that's a
Speaker 1: very interesting topic of conversation because this is an industry
Speaker 1: in transformation. So I think there's two aspects. One aspect is,
Speaker 1: you know, the macro definitely impact demanded. Auto has been
Speaker 1: more resilient than other consumers sectors like handsets, and the
Speaker 1: reason is because there was already pent up demand for
Speaker 1: auto coming from the supply shortage. But you know, like
Speaker 1: everything is impacted for the macro. But the other aspect
Speaker 1: is exactly more interesting, which is investors are looking at
Speaker 1: car companies and asking two questions, are you electrical, are
Speaker 1: you able to electrify? And are you digital? And the
Speaker 1: digital is a necessity. Car companies are investing in digital
Speaker 1: very heavily because that's the future of the industry. That's
Speaker 1: going to define winners and losers. And we see the
Speaker 1: opportunity for semis in each car to increase faster than
Speaker 1: growth of the number of cars. I'm gonna ask you
Speaker 1: someday about a school of thought that's building. The smartphone
Speaker 1: boom and bus cycle is dead. We are only driven
Speaker 1: now by the need to upgrade, as in the boom
Speaker 1: cycles dead. I'm sorry, do you agree with that? It's
Speaker 1: just upgrades that drive adoption and drive purchasing. Okay, So
Speaker 1: smartphones is today the world largest consumer electronic products, right,
Speaker 1: and actually you can think about computing, mobile computing now
Speaker 1: happening on a smartphone. Now everybody in the world a
Speaker 1: few exceptions, have a smartphone, so it's a very mature market.
Speaker 1: So it just only grows organically. So as the market
Speaker 1: that doesn't grow. So it has been now in all
Speaker 1: regions basically being driven by upgrades. So while the units
Speaker 1: are we're still have not recovered from pre pandemic levels
Speaker 1: on the total sides of the market. But we see
Speaker 1: an interesting phenomena people when they buy their next smartphone,
Speaker 1: it is really an upgrade, uh market Now they want
Speaker 1: a better phone. We saw, for example, with the pandemic,
Speaker 1: collaboration and productivity came to phones. People doing team calls
Speaker 1: and some calls. They want a better camera, they want
Speaker 1: a better display. I think that trend will continue and
Speaker 1: uh we just launch five G five G still being deployed,
Speaker 1: five G advances coming. It's going to be the next
Speaker 1: big upgrade of five G, and I think that's going
Speaker 1: to drive audios Christiana. Another trend amid the pandemic, of
Speaker 1: course more to the negative rather than a different way
Speaker 1: in which we use our smartphones, was supply chain. That
Speaker 1: was actually one that you navigated very expertly, if I
Speaker 1: might say so. But just talk to us about supply chain.
Speaker 1: Headaches for you, for welcome, for the industry are there
Speaker 1: in the rear view mirror. Now, uh, as he relates
Speaker 1: to this supply chain constraint, we are a little bit
Speaker 1: in the rear mirror. I think there has been largely resolved.
Speaker 1: Like I can say today that we have no shortage
Speaker 1: on any technology or the companies still have some shortage.
Speaker 1: They're they're going to be doing better. As we go
Speaker 1: to the thousand twenty three, you're gonna see some residual
Speaker 1: shortagh on auto maybe all the way to the end
Speaker 1: of the year, but mostly behind us. So that's I
Speaker 1: think that part is solved. The other exciting part is
Speaker 1: there's now broader recognition the semiconductors are important. I think
Speaker 1: important for the digital economy. I think with the supply
Speaker 1: chain shortage, if there's one positive thing is people it
Speaker 1: was understood the importance of some my conductor companies, and
Speaker 1: there's this desire now to build capacity in different locations.
Speaker 1: You see of the United States Chips and Science Act,
Speaker 1: you see the European Chips Act, and those are actually
Speaker 1: building capacity in a geographically diversified way. That's in the
Speaker 1: We're in the beginning of the phase and that's very
Speaker 1: good for the industry and for the long term. You
Speaker 1: have been a regular attorney a se AS even when
Speaker 1: others of know you had lost yet in person, can
Speaker 1: you just give us a sense about what it's been
Speaker 1: like this week. Have you met with many other CEOs,
Speaker 1: other executives. Business meetings always is simply about the products, announcements.
Speaker 1: Very busy. I you know, obviously CS is back to
Speaker 1: its full force. I think, uh, you know, Gary Shaperior
Speaker 1: did a great job. I think I see most of
Speaker 1: the companies are back here. He has been very busy,
Speaker 1: back to back meetings, I think with other CEOs with
Speaker 1: partners um. I think it's exciting day. And of course
Speaker 1: CS has become a very important auto show so automotive
Speaker 1: companies are here in full force as well. Now I'm
Speaker 1: gonna hold you to account to someday. You've been talking
Speaker 1: about the pipeline forward a motive for a long time,
Speaker 1: but we start see real revenue growth from that wards
Speaker 1: motive businesses. Yeah. Well, we're very proud of the automotive business.
Speaker 1: Is a pipeline now in access of thirty billion dollars.
Speaker 1: And we did say, uh in our Auto Investor Day
Speaker 1: back in September, by two thousand twenty six, Uh, that
Speaker 1: pipeline is going to convert into about four billion dollars
Speaker 1: of revenue twenty six and it's going to be a
Speaker 1: creative to Mark to Mars's and q CIT We're gonna
Speaker 1: get to over nine billion dollars at the end of
Speaker 1: the decade. I remember you coming on with us after
Speaker 1: that or to invest to day. Keep coming on with us, Carl,
Speaker 1: come CEO, Christiano Arman. We lo ak forward to having
Speaker 1: another conversation. Enjoy the rest of CS back in force.
Speaker 1: New New Year's sort of easing in ed straight to
Speaker 1: it in Las Vegas at CS and it felt busy,
Speaker 1: but in the midst all the CEO interviews and things
Speaker 1: you were getting done there. I mean, what was the
Speaker 1: weirdest stuff you saw? Because there's always something highly ridiculous,
Speaker 1: that's hard, that is hard. You know what's funny. It's
Speaker 1: just the people you see walking around wearing kind of
Speaker 1: weird headsets and you're not quite sure what it is
Speaker 1: you're looking at. Um. You know, there's also the kind
Speaker 1: of concept things. Robot dentists are extraordinary, Producer Margarite Gallerini
Speaker 1: when he got her teeth done by a robot. Today
Speaker 1: you see all the A r VR headsets, But for me,
Speaker 1: it's just the footfall. You know, there's hundreds of thousands
Speaker 1: of exhibitors here and then hundreds of Fortune five hundred companies.
Speaker 1: And you've heard it from Christie no m on. It
Speaker 1: seems like CS is back back and realistic, pragmatic. Like
Speaker 1: we were just talking Christian about twenty six deadlines and
Speaker 1: about revenue becoming reality. How much does it feel like
Speaker 1: it's affecting us in the here and the now? You
Speaker 1: heard it right, Sexy realism, that's what Bloomberg News called it.
Speaker 1: It's about being pragmatic and profitable. All of those sort
Speaker 1: of distant futuristic concepts are less so now it's more
Speaker 1: about products that can come to market into three years.
Speaker 1: That's particularly true of the auto makers, and we heard
Speaker 1: it from Mercedes right, this commitment to finish the EV
Speaker 1: charging network globally by I think he said, didn't he Yeah.
Speaker 1: I also asked your question on our Twitter spaces a
Speaker 1: little bit earlier in but like, how diverse does it
Speaker 1: feel regionally geographically kind of people they're women, men, diversity
Speaker 1: in and on itself. Yes, certainly, we have many more
Speaker 1: women executives on the program leading big tech companies this year.
Speaker 1: It's diverse or the floor, but also international. Right, there's
Speaker 1: so many big names from major here. Then you think
Speaker 1: about the names missing. Apple is not here, and I
Speaker 1: always find that fascinating given the focus right now on
Speaker 1: their business. All eyes on Apple is actually one of
Speaker 1: the best performers in terms of points for the S
Speaker 1: and P today, So all eyes on next week's stock performance.
Speaker 1: That does it. But there's very special edition of Blomberg
Speaker 1: Technology from New York from Las Vegas. Safe trip home, ed,
Speaker 1: have a great weekend. This is Bloomberg