Speaker 1: This is Bloomberg Business Week inside from the reporters and
Speaker 1: editors who bring you America's most trusted business magazine, plus
Speaker 1: global business, finance and tech news As it happened. Bloomberg
Speaker 1: Business Week with Carol Messier and Bloomberg Quick Takes. Tim
Speaker 1: Stinevik on Bloomberg Radio. Hi everyone, welcome to the weekend
Speaker 1: edition of Bloomberg Business Week. It's week fifty eight. Working
Speaker 1: from home still for many We both were in the
Speaker 1: office this week, and I gotta say, Tim, New York City,
Speaker 1: our home base, it felt like it was opening up
Speaker 1: this week. It did. I think part of it has
Speaker 1: to do with just how many people are getting vaccinated,
Speaker 1: and then also the weather it does start to feel
Speaker 1: like spring, right, Yeah, exactly made a big, big difference,
Speaker 1: And investors are increasingly focusing on an economic recovery well,
Speaker 1: keeping a watchful eye on the COVID global case count. Also,
Speaker 1: corporate earnings were in the midst of them, yep. And
Speaker 1: with that as our backdrop, this week, we are going
Speaker 1: to hear from one CEO about the recent quarter and outlook.
Speaker 1: Tobotlee CEEO Brian Nichols stopping by. Plus the best electric
Speaker 1: Vehicles you're gonna be surprised about one carmaker that didn't
Speaker 1: make the list. Hint it's Tesla. Given it away, all right.
Speaker 1: We're also going to take you inside the magazine a
Speaker 1: look at the future of energy. Who has it right?
Speaker 1: The head of Exxon or, speaking of Tesla, Elon Musk.
Speaker 1: All of that to come. We begin there with this
Speaker 1: week's cover story, President bind him marking his one hundred
Speaker 1: day in office this coming week. Well, the president taking
Speaker 1: office a mid a health pandemic, a sagging economy, a
Speaker 1: reckoning with centuries of racial injustice, and the existential threat
Speaker 1: of climate change. He's made progress and taking action, and
Speaker 1: yet still faces some tough roads ahead. For all the details,
Speaker 1: we spoke with Bloomberg News White House reporter Nancy Cook.
Speaker 1: I think most people would say that Biden has done
Speaker 1: a pretty good job. You know, he has a majority
Speaker 1: of Americans support him and pulling Democrats, even people who
Speaker 1: wish that Senator Elizabeth Warren or Bernie Sanders had won
Speaker 1: the nomination. They're really happy with him. Um, and he's
Speaker 1: even pulling well with Republicans. Feel like, you know, he's
Speaker 1: done a pretty good job handling COVID and so what
Speaker 1: he walked into chiefly were you know, a pandemic and
Speaker 1: low vaccination rates and schools closed and the economy really
Speaker 1: in a slump. And the first hundred days has really
Speaker 1: been about trying to solve those two crises. And they've
Speaker 1: gotten a lot of that by ramping up the vaccine distribution,
Speaker 1: by getting more people vaccinated, and then passing this sweeping
Speaker 1: one point nine trillion dollar COVID relief bill which gives
Speaker 1: money for things like testing and school reopening and so
Speaker 1: so much of the first one days have just been
Speaker 1: dealing with crisis and now becomes the hard part where
Speaker 1: he's really trying to do something to cinvent his legacy.
Speaker 1: What is the playbook for the next one days? What
Speaker 1: does it need to be? What do people say it
Speaker 1: needs to be? Well, I think the playbook that they're
Speaker 1: trying to do is now that they have I mean,
Speaker 1: they still have to deal with the pandemic, and there's
Speaker 1: still a lot of fallouts from the economic downturn, so
Speaker 1: no one in the White House is discounting that. But
Speaker 1: what they're trying to do now is sort of reshape
Speaker 1: the economy and propose some big ideas that Democrats have
Speaker 1: long wanted to do, and so that includes everything from
Speaker 1: infrastructure to more money for childcare and elder care. And
Speaker 1: that's the sweeping set of packages. President Biden is going
Speaker 1: to unveil this the third one that he's talking about
Speaker 1: um on Wednesday, and and those the most recent two packages,
Speaker 1: the infrastructure and this upcoming families one. You know, that's
Speaker 1: more than three trillion dollars in spending that they are proposing.
Speaker 1: They want to offset it with tax increases, but again
Speaker 1: it's a huge amount of money, and their goal is
Speaker 1: to really not just bring the economy back to where
Speaker 1: it was, but also sort of try to make some
Speaker 1: tweaks to it and reshape it. So obviously it's really ambitious.
Speaker 1: And the Biden administration and Democrats, well Biden administration, you know,
Speaker 1: is the Biden Biden's president. Democrats control the House and Senate,
Speaker 1: but barely uh and there are some modern modern Democrats
Speaker 1: who don't support these plans as they are right now,
Speaker 1: how does Biden sell this and and to what extent
Speaker 1: does it involve selling the plan to the American people
Speaker 1: in a way that President Obama didn't do when it
Speaker 1: came to Obamacare. That's a great question. So the way
Speaker 1: that they sold the COVID Relief Bill, which is the
Speaker 1: way they're going to try to sell these two bills,
Speaker 1: was really to try to build public support outside of Washington.
Speaker 1: So what they have tried to do is to find
Speaker 1: unity or bipartisanship, not really as Democratic lawmakers and Republican
Speaker 1: lawmakers on Capitol Hill a green but more to try
Speaker 1: to promote policies and and put forward ideas that appeals
Speaker 1: to the majority of Americans. And so with the infrastructure package,
Speaker 1: for instance, you know, sevent of Republican voters are in
Speaker 1: favor of rebuilding roads and bridges, more job training, increasing
Speaker 1: broad brand access, and those are the things that the
Speaker 1: Biden White House is going to keep focusing on. These
Speaker 1: plans that appeal to Democratic and Republican voters, not necessarily
Speaker 1: just lawmakers on Capitol Hill. That's really the political strategy.
Speaker 1: Is it a smart strategy? Does it work? Will it work?
Speaker 1: It works With the COVID Relief bill, it worked very well.
Speaker 1: And I think that they feel like based on what
Speaker 1: they saw during the Obama administration and how much Obama
Speaker 1: was tied up with trying to go with after Republicans
Speaker 1: and wu Republicans who didn't really want to work with him.
Speaker 1: I think that the Biden administration learned some lessons and
Speaker 1: felt like they had to go another way and it
Speaker 1: was a gamble, but it works for the COVID relief bill,
Speaker 1: and I think they're going to try the same thing
Speaker 1: with these next two packages. So enter two and that's
Speaker 1: when you know, the mid terms are and I'm wondering
Speaker 1: how the ambitious goals of the Biden administration has right
Speaker 1: now I have to get done before and how that
Speaker 1: can change the landscape in Washington. Well, really, they feel
Speaker 1: like they, you know, the mid term elections, the party
Speaker 1: in power typically loses, and so I think the White
Speaker 1: House is very focused on the mid terms and they
Speaker 1: feel like, you know, they have a window of time
Speaker 1: to try to get these major things done and they're
Speaker 1: going to go for it. And I think so much
Speaker 1: of the argument heading into the mid terms for the
Speaker 1: Biden administration is going to be an economic one. Are
Speaker 1: you better off financially than you were two years ago?
Speaker 1: You know, are you making more money? Um? Is the
Speaker 1: stock market in a good place where the kids schools reopening?
Speaker 1: Are there more people in the middle class? And so
Speaker 1: it's really it's interesting because it's a it's an area
Speaker 1: where Republicans have so dominated. Typically Republican politicians get higher
Speaker 1: polling for their handling of the economy. But what we've
Speaker 1: seen in recent polling is Biden is getting very high
Speaker 1: marks for its handling the economy, and so so much
Speaker 1: of that political argument in two is going to be
Speaker 1: around that. That was Bloomberg News White House correspondent Nancy Cook. First,
Speaker 1: one hundred down. Now it's the next one. I can't
Speaker 1: tell if it's if it felt like a hundred days
Speaker 1: or if it went by really slowly or really fast.
Speaker 1: But time is just really weird right now, Carol, for
Speaker 1: so many people. I totally agree. All right, coming up,
Speaker 1: how doctors are working on building public trust and acceptance
Speaker 1: of vaccines. This is really important. It is especially as
Speaker 1: we get to the second half of American adults getting
Speaker 1: the vaccine. You're listening to Bloomberg Business Week. This is Bloomberg.
Speaker 1: This is Bloomberg Business Week with Carol Messer and Bloomberg
Speaker 1: Quick Takes Tim Stinovik from Bloomberg Radio. Earlier this week,
Speaker 1: President Biden had some good news regarding the pandemic. He
Speaker 1: announced that America reached his goal of two hundred million
Speaker 1: shots on day ninety two of his presidency, so ahead
Speaker 1: of schedule. I'm proud of the American people, the volunteers
Speaker 1: who showed up two staff vaccination sites in their neighborhoods,
Speaker 1: drove senior citizens who get their shots. FEMA, the military,
Speaker 1: the National Guards, state and local health departments, and providers
Speaker 1: running sites safely and efficiently ahead of schedule. But Carol
Speaker 1: now comes the hard part that second half of Americans,
Speaker 1: more than of the U S population, has received at
Speaker 1: least one dose of the vaccine. And for more on
Speaker 1: the vaccine rollout in America, we turned to Dr Chris By,
Speaker 1: professor of Public Health and Human Rights at the Johns
Speaker 1: Hopkins Bloomberg School of Public It is supported by Michael R. Bloomberg,
Speaker 1: founder of Bloomberg LP and Bloomberg Philanthropies. The good news
Speaker 1: here really is that we have two very safe and
Speaker 1: effective vaccines, the two Messenger RNA vaccines UM, the MODERNA
Speaker 1: and the Visor UH. Those, of course, are both two
Speaker 1: dose vaccines. They have not had some of the same
Speaker 1: problems that have emerged with the with the Jansen, the
Speaker 1: Johnson and Johnson vaccine where the astra Zeneca vaccine. This
Speaker 1: is the challenge that has been rare, but nevertheless, UM,
Speaker 1: significant complication and blood clots. We don't see those with
Speaker 1: either the Visor or the Maderna. So our vaccine rollout
Speaker 1: is going really very well. UM. We're over you know
Speaker 1: now three million adults being immunized every day. UM, and
Speaker 1: we're expecting emergency used authorization for the Visor vaccine to
Speaker 1: go down to twelve to seventeen year olds as well.
Speaker 1: That may happen fairly soon. Can we get out of
Speaker 1: the pandemic though, If people under the age of twelve
Speaker 1: cannot be vaccinated, well, about of the American population is
Speaker 1: children under aged eighteen TI, so it is very important
Speaker 1: that we learn as quickly as we can uh, if
Speaker 1: these vaccines are as safe and effective in children as
Speaker 1: they are in adults. UM. That process is mostly being
Speaker 1: led right now by the companies themselves. The trials are underway. UM.
Speaker 1: We have the data, as I said, from the twelve
Speaker 1: to seventeen year old. UH. The we really need to
Speaker 1: accelerate the research effort for the five to twelve year
Speaker 1: old and of course they're so important for them for
Speaker 1: you know, getting back to seeing their friends and getting
Speaker 1: back to school and and getting back to acted life,
Speaker 1: which so we really need for our kids, right getting
Speaker 1: back to you know, a so called normal life. The
Speaker 1: thing is, I mean, bottom line, vaccines are the way
Speaker 1: out of the pandemic done right, no question, no question.
Speaker 1: So if we don't get to her immunity, what does
Speaker 1: our world look like? Well right now we have a
Speaker 1: couple of very specific challenges. People have described this as
Speaker 1: a race between the vaccine rollout and the emergence of
Speaker 1: these new variants, the mutants that you were mentioning, and
Speaker 1: that really is a challenge. Some of these new variants
Speaker 1: are more infectious than the viruses we first encountered, um,
Speaker 1: some of them have more resistance to the broadly neutralizing
Speaker 1: anybody's that we've been using. And at least one for sure,
Speaker 1: the variant that was first identified in South Africa, does
Speaker 1: appear to be a challenge for at least the astros
Speaker 1: Ennica vaccine. The good news is that they both the
Speaker 1: Messenger RNA vaccines, Biserne Maderna, and as far as we
Speaker 1: can tell, that Inson and Johnson vaccines do appear to
Speaker 1: provide good, robust protection against the variants that are circulating now.
Speaker 1: But what we're learning with this virus is that mutations
Speaker 1: keep happening UH, and we really have to get ahead
Speaker 1: of those mutations. The big challenge right now is that
Speaker 1: the vaccine rollout is sold in much of the rest
Speaker 1: of the world. That's because the rest of the world
Speaker 1: doesn't have the same access to the messenger RNA's they
Speaker 1: were relying on astras Enka and Johnson and Johnson UH.
Speaker 1: And we are seeing huge surges of infection in places
Speaker 1: like India and Brazil UH, much of South America in fact.
Speaker 1: And if we can't do better with getting control of
Speaker 1: those epidemics and getting those populations immunized UH, the current
Speaker 1: generation of vaccines may be undermined by these new variants.
Speaker 1: That's a real threat and we're working very hard to
Speaker 1: prevent that scenario. Dr Bira, a listener are listening in
Speaker 1: on our conversation, has a question for you, and basically
Speaker 1: is asking, how can we, as parents and good conscience
Speaker 1: ask our kids to get shots when we have no
Speaker 1: data to support the side effects on kids. Furthermore, this
Speaker 1: disease is not a real risk for anyone under thirty.
Speaker 1: Deaths under the age of eighteen represent point zero zero
Speaker 1: zero seven. Basically, they're saying that kids are going to
Speaker 1: be okay, So why are we going to maybe potentially
Speaker 1: put them at risk by giving them a shot. How
Speaker 1: can we do this in good conscience? Well, the first
Speaker 1: thing could say is, of course, that we wouldn't ask
Speaker 1: anybody to have their children be immunized until we have
Speaker 1: the data. And so those trials are underway UH And
Speaker 1: as I said earlier, the twelve to seventeen year old
Speaker 1: data from the Fiser UH trial is going to the
Speaker 1: f d a M and being reviewed. So so I
Speaker 1: think the caller is absolutely right that we need to
Speaker 1: see those data, and parents are going to want to
Speaker 1: see that before they imman oz. I think it's a
Speaker 1: common misconception to compare COVID nineteen UH disease and deaths
Speaker 1: in children with those and adults. The real question is
Speaker 1: comparing COVID nineteen disease and deaths and children with other
Speaker 1: vaccine preventable diseases and children. And when you do that,
Speaker 1: there close to three children who died already of COVID
Speaker 1: in the United States. UH. Looks actually like quite a
Speaker 1: severe UH number of cases and a vaccine preventable infection.
Speaker 1: We hope so I think that's more compelling. UM. It's
Speaker 1: also the case that UM, while children have had much
Speaker 1: lower rates of illness and death from COVID, they've had
Speaker 1: a very high burden of non health issues. The social
Speaker 1: isolation is hard for kids, to developmental issues, the educational
Speaker 1: issues that parents are so concerned about. And we think,
Speaker 1: particularly for the twelve to seventeen year olds, that vaccination
Speaker 1: is really going to help them be able to engage
Speaker 1: again in sports and after school activities and being with
Speaker 1: their friends. So those those all get weighted in. The
Speaker 1: non medical complications of COVID for kids have been severe.
Speaker 1: Talking about vaccines for kids, this is a big issue,
Speaker 1: and I think we need to really understand everything we
Speaker 1: can from the medical community because parents have lots of questions. Yeah,
Speaker 1: look at something that my family thinks a lot about
Speaker 1: because my wife and I, you know, are going to
Speaker 1: be fully vaccinated in the next few days, but are
Speaker 1: toddler won't be, So what does that mean for what
Speaker 1: we can and can't do well? We always love checking
Speaker 1: in with the folks over at Hopkins. One note that JOHNS.
Speaker 1: Hopkins Bloomberg School of Public Health, supported by Michael R. Bloomberg,
Speaker 1: founder of Bloomberg LP and Bloomberg Philanthropy. We'll still ahead
Speaker 1: on Bloomberg Business Week. We're going to hear from the
Speaker 1: CEO of Bowerie Farming. It's a vertical farming company that's
Speaker 1: backed by Google, blacked by Google and a few other
Speaker 1: interesting investors. This is Bloomberg broadcasting from the financial capital
Speaker 1: of the world, Bloomberg Eleve in Rio in New York
Speaker 1: to Washington, d C, bog to Boston, Bloomberg one oh
Speaker 1: six one does San Francisco, Bloomberg nine sixty to the
Speaker 1: country Sirius XM Chadal one nine team and around the
Speaker 1: globe of Bloomberg Business app and Bloomberg Radio dot Com.
Speaker 1: This is Bloomberg Business Week. So a big focus on
Speaker 1: the climate. This past week President Biden hosting a virtual
Speaker 1: Global Climate Summit with world leaders. Also of course Earth
Speaker 1: Day and in keeping with that, and we decided to
Speaker 1: catch up with Irving Fain, the founder and CEO of
Speaker 1: Bowery Farming, and you know Tim if you haven't heard
Speaker 1: of it, Barry build Smart Indoor Farms and counts g
Speaker 1: V formerly Google Ventures. Also Henry Kravis of KKR and
Speaker 1: leaders and food including David Barber, a blue hill, Tom
Speaker 1: Colleckio and Jose Undress as investors, and here's some of
Speaker 1: our conversation with Irving Fain of battery farming. What we
Speaker 1: do with Bowery is build smart indoor farms that we
Speaker 1: locate very close to the cities and the communities that
Speaker 1: we serve. And so inside of the farms, we actually
Speaker 1: stack our crops from the floor are all the way
Speaker 1: up to the ceiling, and we grow under lights to
Speaker 1: mimic the spectrum of the sun. And it's totally controlled
Speaker 1: and contained environment, and so we can grow fresh, protected
Speaker 1: produce three hundred sixty five days of the year, independent
Speaker 1: of weather and independent of seasonality. But what makes it
Speaker 1: even more interesting is we go completely pesticide free, completely
Speaker 1: agro chemical free food, so no herbicides, no fungicides, no
Speaker 1: one's exicides, no pesticides. And whereas when you do that
Speaker 1: in the field, your quality suffers and your yield suffers.
Speaker 1: In our case where over a hundred times pluts more
Speaker 1: productive than a square foot of farmland, and we use
Speaker 1: a very small fraction of the water compared to traditional agriculture.
Speaker 1: What about lighting, lighting meaning meaning we use lighting or
Speaker 1: what well, what what are the problems that you know,
Speaker 1: I've done, you know, some some research and some work
Speaker 1: and reporting on some of these indoor door farming is
Speaker 1: that the lighting that's needed is a lot of electricity.
Speaker 1: And so when you're looking for sustainable ways, right, you've
Speaker 1: got to get the complete picture. And I'm just curious
Speaker 1: what's involved in making sure because you say you take
Speaker 1: the seasonality out of it, and I'm looking at a
Speaker 1: lot of video are was earlier on your website and
Speaker 1: there's a lot of light obviously that's needed for plants.
Speaker 1: So tell me a little bit about that part of
Speaker 1: the equation. Got it make? It's a great question, Carrol,
Speaker 1: and I think it's something we think a lot about
Speaker 1: from a few different funds. Most importantly, in number one,
Speaker 1: we power our farms with renewable energy. And so the
Speaker 1: farm that I'm actually in right now in Maryland uses
Speaker 1: low impact hydro power its power will continue to do
Speaker 1: that as we continue to build farms. So the power
Speaker 1: that we go source is from renewable sources. The second
Speaker 1: piece that I think is important to understand is we're
Speaker 1: as you look at what we're building, is what we're
Speaker 1: really doing at Bowery isn't just innovating farming, we're actually
Speaker 1: reinventing the entire fresh food supply chain. And so we
Speaker 1: do that because we control the entire supply chain from
Speaker 1: seed all the way to store. So if you compare
Speaker 1: what we're doing at Bowery and Agriculture, you actually just
Speaker 1: can't just compare it to a farm. You have to
Speaker 1: compare it to the entire supply chain from the harvesting
Speaker 1: to the transportation of processing and packing and then storage
Speaker 1: across the supply chain and all the trucking miles that
Speaker 1: are required to do that. And so we're eliminating thousands
Speaker 1: of food miles, a number of different steps where food
Speaker 1: is actually wasted. And because we're centralizing everything in one place,
Speaker 1: we can power it all, as they said, with renewable energy,
Speaker 1: whereas to try to put renewable resources against the entire
Speaker 1: existing agricultural supply chain today will be really difficult. So
Speaker 1: are you a profitable company? So we we don't. We
Speaker 1: don't disclose our financial publicly because we are a private company,
Speaker 1: but we do think a lot about sustainability, not just
Speaker 1: from an environmental perspective, but also from an economic perspective
Speaker 1: as well, because to create the greatest impact. You need
Speaker 1: to create a sustainable, long term viable business, and that's
Speaker 1: a really important focus about okay, and are you creating
Speaker 1: a long term viable business? Listen, you know we're Bloomberg,
Speaker 1: and I know you're not going to open up your
Speaker 1: books and show me everything. I assume you wouldn't be
Speaker 1: doing it, and you wouldn't have investors like Henry Kravis
Speaker 1: or you know, GV involved if they didn't see UM
Speaker 1: a profitable path at some point. So I'm just curious
Speaker 1: kind of where you guys fit in and and what's
Speaker 1: the math on this, what's the business metrics on this,
Speaker 1: and and where does it go? So you're you're absolutely
Speaker 1: right that we are incredibly fortunate. You know, to date
Speaker 1: we raised a hundred and seventy five million from really
Speaker 1: incredible partners, Google Ventures, General Catalyst, TOMASI, folks like Henry
Speaker 1: and you mentioned a lot of great people who supported
Speaker 1: us to date. And as you said, you know, folks
Speaker 1: like that don't don't support a company that they don't
Speaker 1: see a path towards becoming a large company and a
Speaker 1: large business, which requires one to build a sustainable business.
Speaker 1: But I think the other side of of what your
Speaker 1: question was that the interesting economic component of what we're
Speaker 1: doing is really in that reimagination of the supply chain
Speaker 1: that serving fame the founder and CEO of Barry Farming.
Speaker 1: I love all the stuff that's going on when it
Speaker 1: comes to farming, whether it's on rooftops, whether it's um hydroponic.
Speaker 1: I mean, we're really trying to figure out better and
Speaker 1: more productive ways to do it and really a lot
Speaker 1: more closer to actually to the people who need it. Yeah.
Speaker 1: And oftentimes when you think of food, you don't necessarily
Speaker 1: think of venture capital and tech companies like you know,
Speaker 1: the venture arm of Google. But you marry those companies
Speaker 1: with people like Tom click e oh and people involved
Speaker 1: at Blue Hill, it Stone Barns. That's a big deal. Yeah, exactly,
Speaker 1: because they aren't listen thinking about this NonStop. You're listening
Speaker 1: to Bloomberg Business Week. Coming up next another company that's
Speaker 1: interested in farming and food production. We're talking about Chippotle Burrito's.
Speaker 1: We got an update on the business with CEO of
Speaker 1: Brian Nicol. This is Bloomberg. You're listening to Bloomberg Business
Speaker 1: Week with Carol Messer and Bloomberg Quick Takes. Tim Stinovik
Speaker 1: from Bloomberg Radio this past week. One of the best
Speaker 1: known names in the fast casual restaurant space. To be
Speaker 1: fair to him, they really kind of created the fast
Speaker 1: casual space. We're talking about Chipotle Mexican Grill. The company
Speaker 1: reported a jump in profitability thanks to a rebound in
Speaker 1: sales and hire menu prices. Digital once again a big,
Speaker 1: big driver. Digital absolutely took off during the pandemic. Even
Speaker 1: thinking about my own experience, the first time that I
Speaker 1: downloaded Chipotle's app and used it to order ahead was
Speaker 1: in March of last year, at the height of the pandemic.
Speaker 1: The company has been featured in the magazine before on
Speaker 1: the Bloomberg Fifty list in twenty nineteen for the company's turnaround,
Speaker 1: engineered by its CEO, Brian Nicol. Brian joined us once
Speaker 1: more to talk about the business and the company's outlook. Look,
Speaker 1: I think we've got our company and our people focused
Speaker 1: on the right things. So I talked about this in
Speaker 1: the earnings call, which is you know, obviously we're a
Speaker 1: restaurant company, so we have to be hiring, training the
Speaker 1: best people, creating the right culture in the restaurants so
Speaker 1: that we provide a great ulminary experiences that we can
Speaker 1: at our restaurants, and so we started there and from
Speaker 1: there we wanted to make sure we had more accessibility
Speaker 1: and that's really where the digital focus has come in,
Speaker 1: as well as our in dining room experience. And as
Speaker 1: you mentioned, we've made tremendous progress on the digital front.
Speaker 1: We actually had record sales for the quarter. We did
Speaker 1: over eight hundred and seven million dollars just in digital sales,
Speaker 1: which you know was up in a big way, and uh,
Speaker 1: you know that's because we're giving more customers more access
Speaker 1: and with that digital ability, Uh, it's really convenient whether
Speaker 1: you want to order ahead and pick up, order ahead
Speaker 1: and grab it from your car, order ahead and have
Speaker 1: it delivered. And then now with COVID cases on the decline,
Speaker 1: vaccines going up, and more places opening up dining rooms,
Speaker 1: we're seeing people come back into our dining rooms for
Speaker 1: that great experience as well. How would you characterize capacity
Speaker 1: right now compared with pre pandemic in the actual restaurants.
Speaker 1: You know, so in our dining rooms we probably have
Speaker 1: heard about sixty per cent of our dining room business.
Speaker 1: We're optimistic that that's going to continue to climb as
Speaker 1: more and more places become more and more open and
Speaker 1: people get back to their normal routines, you know, taking
Speaker 1: kids to school, going to work, um, whatever your normal
Speaker 1: day looks like. The thing that's really great news about
Speaker 1: this is while our dining rooms have recovered, our digital
Speaker 1: business has not really seen any cannibalization to meaningful levels.
Speaker 1: So that's why you see the record sales and digital
Speaker 1: even while our dining rooms are coming back. That's pretty remarkable.
Speaker 1: You expect that to continue even as the world continues
Speaker 1: to reopen. Brian no I do. I think people by
Speaker 1: nature want to be social, and one of the more
Speaker 1: social things to do is have lunch together, have dinner together.
Speaker 1: And then also I don't think this is changing. When
Speaker 1: people get back to their normal routines, they want access
Speaker 1: to great, clean food in a customized fashion, in a
Speaker 1: convenient way. And you know Chipotle is that right where
Speaker 1: food with integrity. Uh, it's totally customizable and uh, you know,
Speaker 1: the speed is pretty amazing. So I think it's going
Speaker 1: to continue, and I believe people will continue to come
Speaker 1: back to the dining rooms and they're going to demand
Speaker 1: more access digitally. You've got to be able to do
Speaker 1: both what was more important the stimulus jacks that came
Speaker 1: out from the government or the handcrafted uh case idias.
Speaker 1: I'm just curious what had a bigger, bigger impact on
Speaker 1: the bottom line. Well, you know, it's definitely clear as
Speaker 1: both played a really good role. And uh so, you know,
Speaker 1: obviously the stimulus payments are a point in time versus
Speaker 1: the case D is going to be around for a
Speaker 1: long time, and so we're optimistic about where we get
Speaker 1: to with the addition of the case to be and
Speaker 1: the business and uh you know, I think putting our
Speaker 1: food into this really portable solution, which is you know,
Speaker 1: the case DA, it's just fabulous. So I don't know
Speaker 1: if you have a chance to try it, but I
Speaker 1: highly encourage it. I love me some case idia and
Speaker 1: yours included. But it was a really ten of first
Speaker 1: quarter sales that just like blows my mind. Yeah, you know,
Speaker 1: it came out of the gates really strong, and the
Speaker 1: feedback from customers has been really excellent. You know, they
Speaker 1: love the experience. They love being able to get their
Speaker 1: glock or caso or people to guyo with our case adillas,
Speaker 1: and the digital experience has been really phenomenal. It's a
Speaker 1: great start. A lot of new people came into our business.
Speaker 1: I think it was the highest level of new users
Speaker 1: to Chipotle in the month of March, and a lot
Speaker 1: of that had to do with the fact that we
Speaker 1: brought the case d L. Hey, Brian, I know digital
Speaker 1: was so big for you this last quarter and over
Speaker 1: the last year, but you're also thinking a lot about
Speaker 1: restaurants and looking too close to double or more than
Speaker 1: double the footprint in the US and Canada UH in
Speaker 1: the coming years. I'm wondering how you're thinking about the
Speaker 1: restaurant experience on the other side of this, because we
Speaker 1: do know that there's likely going to be some sort
Speaker 1: of hybrid work environment where people are going to be
Speaker 1: working from home. In Chipotle has been huge for people
Speaker 1: who are working in offices, right this is what they
Speaker 1: grab and go and they get for lunch. So how
Speaker 1: are you thinking about locations differently? In so, how are
Speaker 1: you thinking about store design differently to imagine some sort
Speaker 1: of new normal on the other side of the pandemic.
Speaker 1: Because I'm also thinking there's some real estate deals out
Speaker 1: there right now because of the pandemic. Yeah, you don't
Speaker 1: look You're exactly right. We believe there is a lot
Speaker 1: of opportunity for us to build a lot more tiboldays, right,
Speaker 1: we're just shy a three thousand today. You probably saw
Speaker 1: in our release we opened forty new restaurants in the
Speaker 1: first quarter. We've guided to doing about two restaurants this year.
Speaker 1: Uh and ultimately we want to get to you know,
Speaker 1: five six thousand plus restaurants. UM. So as we think
Speaker 1: about the design of these restaurants, though, we want to
Speaker 1: make sure we've got great accessibility. So if that means
Speaker 1: you're coming in for a dining room experience, I think
Speaker 1: it's important to have a great seat with great music,
Speaker 1: get your food quickly, get exactly what you want, and
Speaker 1: get on with your heal. And I think that trend
Speaker 1: is not changing. Um. And then the digital we've added
Speaker 1: more access by providing this Chapoleon window where you can
Speaker 1: order ahead and pick it up from your car. And
Speaker 1: you know, that's been a phenomenal breakthrough for us where
Speaker 1: we see our you know, our total business goes up
Speaker 1: as results of it, but our digital business increases and
Speaker 1: predominantly increases with the order ahead and pick up business,
Speaker 1: which is our most profitable transaction. So to answer your question,
Speaker 1: I think the good news is we're really well positioned
Speaker 1: for the hybrid work model, the return to work model. Uh,
Speaker 1: you you can insert whatever normalcy is the new normal.
Speaker 1: We're ready to go because we've got access for all
Speaker 1: of those occasions. And uh, you know, I'm confident that
Speaker 1: food with integrity, customized at a great value is going
Speaker 1: to continue to win the day. And where does where
Speaker 1: does order and delivery come into this? Because I know
Speaker 1: that's something that you talked about. In the cost of
Speaker 1: actually getting that burrito, that food to the consumer, that's expensive.
Speaker 1: How do you lower that cost? Yeah, so look, we
Speaker 1: would love to find ways to lower the cost of
Speaker 1: the delivery channel. That's why we're experimenting and investing in
Speaker 1: companies like neuro where it's an occupant less autonomous vehicle. Uh.
Speaker 1: Until then though, you know, obviously we want to get
Speaker 1: us affici and as we can in that channel. But
Speaker 1: those costs obviously make delivery and more premium convenience. And
Speaker 1: so what we've seen is people understand that and uh
Speaker 1: we passed those costs on in order to get that
Speaker 1: premium convenience. You know, there's a price to pay for it.
Speaker 1: We would love to find ways to lower that cost
Speaker 1: so that you know, we don't have to charge that premium. Hey,
Speaker 1: one thing I want to go back to digital if
Speaker 1: I can, Brian, is you recently launched a digital only
Speaker 1: restaurant that's up in I think Highland Falls, New York.
Speaker 1: How is that doing? And I'm curious if there's plans
Speaker 1: for for more. Yeah, it's doing really well. Thanks for asking,
Speaker 1: and yeah, we will be doing more. I would say
Speaker 1: in the US, it's more of a fill in strategy. Uh.
Speaker 1: You know, so I think of some of these markets
Speaker 1: where you've got a lot of Chipotle's already, we want
Speaker 1: to give people that additional access maybe we need. Frankly,
Speaker 1: you know you've got to chipole doing three four million
Speaker 1: dollars um. If we could put in another restaurant, do
Speaker 1: it all digital. One will make the experience better at
Speaker 1: that lunch bole Uh, and then also gives people better
Speaker 1: digital experience. So I think there's opportunities there. And then
Speaker 1: there are trade areas like Highland Falls where it just
Speaker 1: makes sense to have a digital only restaurant, and so
Speaker 1: where those present opportunities will obviously do that, but the
Speaker 1: majority of what will continue to build is a you know,
Speaker 1: a Chipotle that has all the access points. Right. The
Speaker 1: thing that's great about Chipole is we have a kitchen
Speaker 1: that is doing real culinary fresh ingredients. The guys are
Speaker 1: just cooking up unbelievable chicken steak. And then that kitchen
Speaker 1: services these two businesses. Right, You've got the digital wording
Speaker 1: business and you've got the pressumer that comes in moves
Speaker 1: down the line, and we've got the capacity off that
Speaker 1: kitchen to service both of those experiences. So you know,
Speaker 1: we've got a lot of room to grow still in
Speaker 1: the digital business, and we've got a lot of groom
Speaker 1: to grow on that dining business. I love this situation
Speaker 1: we're in right now, Brian. I know you guys didn't
Speaker 1: come out with UM I think comp sales forecast. There
Speaker 1: are still concerns about COVID and the impact. Tell me
Speaker 1: about the visibility you feel like that you do have
Speaker 1: or is it maybe at the end of the year
Speaker 1: do you feel like you'll start to feel more confident
Speaker 1: about visibility. Look, I think it's just uh us being
Speaker 1: aware of what's happening. Right. You see some regions where
Speaker 1: COVID continues to spike, and uh you're hearing a lot
Speaker 1: of good things as it relates to the vaccine. UH.
Speaker 1: So as I think we just get further into the year, UH,
Speaker 1: you'll get rid of some of that UM I guess
Speaker 1: volatility associated with COVID UH. And then that gives you
Speaker 1: more confidence sharing you know a number. Obviously we plan
Speaker 1: accordingly UM for a certain response to our initiatives, but
Speaker 1: you know, when there's external factors like COVID going on, UH,
Speaker 1: I think the prudent thing to say is, hey, look,
Speaker 1: I think we've got the right plans in place to
Speaker 1: navigate it. UM. But it really has sense to commit
Speaker 1: to a number that's about LACEDEO. Brian nicol And to
Speaker 1: be fair, like you mentioned before we got into the interview,
Speaker 1: he was on the Bloomberg fifty list back in twenty nineteen.
Speaker 1: I mean he really did come into a company. We know,
Speaker 1: all of the E. Coli outbreaks out at Chipotle really
Speaker 1: set it back for several years. They had a huge
Speaker 1: turnover in terms of the management. I've spent a lot
Speaker 1: of time initially with Steve Els, who was one of
Speaker 1: the co founders of the company, h and all of
Speaker 1: that management, and they really do fast casual and change
Speaker 1: the restaurant space in a big way, but they had
Speaker 1: big problems and Brian Nickel came in and really turned
Speaker 1: that company around. It's been incredible what he's been able
Speaker 1: to do, and shareholders have certainly rewarded him and the
Speaker 1: company for that. Well, it's gonna wrap up the first
Speaker 1: hour of the weekend edition of Bloomberg Business Week from
Speaker 1: Bloomberg Radio. I'm Jim Stanov and I'm Carol mass are
Speaker 1: coming up in our next hour. We're gonna look at
Speaker 1: the future of energy kind of from a management perspective.
Speaker 1: I would say it's a great business school case study. Basically,
Speaker 1: we're comparing the CEO of x On and the CEO
Speaker 1: of Tesla. We're talking about Elon Musk, who will have
Speaker 1: it right when it comes to the future of energy.
Speaker 1: Plus we're talking Auto Trader and electric cars because Auto
Speaker 1: Trader has a list of the best evs of and
Speaker 1: Carol one big name failed to make the list. I
Speaker 1: gave it away at the beginning. You did give it away,
Speaker 1: and I just gave it away to kind of because
Speaker 1: I just talked about Tesla. Folks they're not on the list.
Speaker 1: Will explain why this is Bloomberg. This is Bloomberg Business
Speaker 1: week Inside from the reporters and editors who bring you
Speaker 1: America's most trusted business magazine, plus global business, finance and
Speaker 1: tech news as it happened, Sloomberg Business Week with Carol
Speaker 1: Messer and Bloomberg Quick Takes Tim Stinovic on Bloomberg Radio. Hi,
Speaker 1: I'm Carol Masser and I'm Tim Stovik. Plenty ahead in
Speaker 1: our second hour of the weekend edition of Bloomberg Business Week,
Speaker 1: including a look inside Auto Trader's list of the best
Speaker 1: electric cars. Plus Consuelo Vanderbilt Costan tells us all about
Speaker 1: Soho News. It's her new professional networking website for the
Speaker 1: global creating community. And if her name sounds familiar, it should.
Speaker 1: It's one of the iconic families of the United States.
Speaker 1: We'll talk a little bit about that as well. First
Speaker 1: up this hour, this week's remarks in the magazine takes
Speaker 1: a look at the future of energy from a management perspective.
Speaker 1: This is a great business school case study, It really is.
Speaker 1: It looks at Tessa CEO Elon Musk and also his
Speaker 1: counterpart it X on Mobile Darren Woods. Safe to say
Speaker 1: that the name of X and CEO probably doesn't readily
Speaker 1: come to mind he keeps a low profile, unlike Mr
Speaker 1: Elon Musk. We spoke with Bloomberg Business, we getitor Joe
Speaker 1: Webber and Bloomberg opinion columnist at Liam Denning, who watches
Speaker 1: the commodity space. The way I think about it is,
Speaker 1: you know, if you go back a few years, Exon
Speaker 1: was the most valuable company in the world. It could
Speaker 1: kind of do no wrong um and investors had this
Speaker 1: kind of rock solid belief in it. And here we are,
Speaker 1: you know, just a few short years later in early
Speaker 1: um x On is. You know, it's been through some
Speaker 1: troubling times, it's run pretty much the same as it
Speaker 1: always has been, but it's lost that kind of belief
Speaker 1: from investors, where Tesla, you know, despite everything it does
Speaker 1: that you think would shake belief, just has this kind
Speaker 1: of fanatical devotion on the part of investors. So I
Speaker 1: just always an interesting way of looking at these two
Speaker 1: companies opposite ends of the energy business, really interesting, and
Speaker 1: I thought, man, this would be great to like just
Speaker 1: sit down with a bunch of people like we are
Speaker 1: doing now and just talk about it like you do.
Speaker 1: Wonder because both liam are optimistic long term and how
Speaker 1: can that be possible? Can it be possible that they
Speaker 1: both have, at least in the somewhat longer term, you know,
Speaker 1: optimistic futures or is that impossible. I think it's impossible.
Speaker 1: You know, there is one viewpoint that says, well, look,
Speaker 1: the energy transition will take time, and these both of
Speaker 1: these companies can certainly make money for some period. But
Speaker 1: I think when you look at their core belief systems,
Speaker 1: they're just very different. I mean, you know, Bloomberg any
Speaker 1: f our own in house forecasters. You know, they're pretty
Speaker 1: bullish on electric vehicles, but even they see it as
Speaker 1: taking a little while, um, maybe into the middle of
Speaker 1: the thirties to see like serious market penetration. Elon must
Speaker 1: sees it happening much quicker than that. You look at
Speaker 1: Excel mogul Um, they're more in the it will take time,
Speaker 1: camp we can develop new businesses, that sort of thing.
Speaker 1: I just think the the the the sheer aggressiveness of
Speaker 1: each view makes them incompatible. You know, one of one
Speaker 1: of these is going to work out to be true,
Speaker 1: but not both. It does seem like the money right
Speaker 1: now is on Tesla, though it's it's hard to imagine
Speaker 1: a world where fossil fuels in a company that really
Speaker 1: is focused on fossil fuels ends up being the one
Speaker 1: that survives, right, I think longer term for you know,
Speaker 1: fossil fuels are going to peak and decline absolutely. Um.
Speaker 1: I think it's a question of degree. You know. Um,
Speaker 1: Exxon has suffered mainly because it made some really bad
Speaker 1: tactical errors. Um, you know, stretching all the way back
Speaker 1: to about a decade ago when it brought this very
Speaker 1: expensive gas business where it ended up writing off quite
Speaker 1: a lot of it at the end of last year,
Speaker 1: and there have been other mistakes I think where it
Speaker 1: gets little unbelievable as if you look at Tesla. I mean,
Speaker 1: clearly there is a lot of money flowing into clean
Speaker 1: tech right now and there is a bright future for
Speaker 1: that business. But you know, you look at Tesla, It's
Speaker 1: made about billion dollars of profit over the last six quarters.
Speaker 1: It's valued at like seven billion dollars. Um. Has the
Speaker 1: market got a bit ahead of itself on Tesla? I
Speaker 1: would say, yes, Well that kind of speaks to you
Speaker 1: know how Excen specifically has performed this year year today,
Speaker 1: h Liam And and that number actually really jumped out
Speaker 1: to me. UM, So talk about like why why an
Speaker 1: exon might be able to continue to performing in the
Speaker 1: shorter term, while while as in the long run, we
Speaker 1: can might still the market might be right to be
Speaker 1: bullish on Tesla. Yeah, I think in the short term
Speaker 1: what Excen is doing, it's a couple of things. One
Speaker 1: is that it's just at the oil price has recovered
Speaker 1: a bit from the from the COVID pandemic, so that's
Speaker 1: kind of lifted all oil companies. I think the other
Speaker 1: thing is excellent has you know, it's ex someone was
Speaker 1: kind of aloof for the longest time. I mean, I
Speaker 1: think I mentioned in the piece that Darren Woods made
Speaker 1: made headlines just for showing up on an earn uh
Speaker 1: and and they've actually had to listen, you know, they
Speaker 1: actually had activists show up and had to engage with them.
Speaker 1: And so they have They've adjusted their stance. They've they've
Speaker 1: reigned in spending, they've started acknowledging that there is actually
Speaker 1: an energy transition and there there potentially going to start businesses.
Speaker 1: But look at that. So they're they're coming back, partly
Speaker 1: because the all price is coming back, but partly because
Speaker 1: they seem to have acknowledged their past mistakes with Tesla.
Speaker 1: There is there is there is a core story of
Speaker 1: the energy transition, and that's that's right, of course, um,
Speaker 1: but it's also a function of the fact that we
Speaker 1: are we are in a moment in markets where that
Speaker 1: kind of long term vision thing is meeting, you know,
Speaker 1: very low interest rates and you do get some fantastic value.
Speaker 1: That's Bloomberg Opinion columnist Liam Denning and Bloomberg Business Week.
Speaker 1: Get out of Joel Webber and listen to him. Only
Speaker 1: time will tell which vision of the future of energy
Speaker 1: will be correct. Is it Exxon or is it Tesla? Well,
Speaker 1: shareholders are certainly voting right now, and Tesla is I
Speaker 1: think in the lead. Well coming up. Tesla was part
Speaker 1: of another conversation we had this week because of its
Speaker 1: absence from the list of the best evs of We're
Speaker 1: going to explain right after this. You're listening to Bloomberg
Speaker 1: Business Week. This is Bloomberg. This is Bloomberg Business Week
Speaker 1: with Carol Messer and Bloomberg Quick Takes Tim Stenoby from
Speaker 1: Bloomberg Radio. A lot going on in the world of
Speaker 1: electric vehicles, right We know that, especially as major automakers
Speaker 1: ramp up their offerings. Recently, we heard about Mercedes Ben's
Speaker 1: tim entering a new era with its flagship S class
Speaker 1: sedan going electric. So we decided to get a roundup
Speaker 1: of the best electric vehicles according to one batch of metrics,
Speaker 1: this one from Auto Trader, which interestingly does not include
Speaker 1: a major player in the space, and I'm going to
Speaker 1: say it has something to do with those metrics. We
Speaker 1: caught up with Brian Moody, he's executive editor for Auto Trader.
Speaker 1: He filled us in on how they came up with
Speaker 1: the list and it's findings. So one of the things
Speaker 1: that we included was the car had to have a
Speaker 1: plug and so we didn't include hybrids, but we did
Speaker 1: include plug in hybrids, so they're both electric only and
Speaker 1: plug in hybrid vehicles. We also put the price cap
Speaker 1: at seventy five dollars, and we wanted to only include
Speaker 1: cars that would be available within the next six months
Speaker 1: of the public so that it would need you know,
Speaker 1: it would be meaningful to someone who's going to buy
Speaker 1: an electric car. Alright, So notably absent is Tesla. Is
Speaker 1: it that dollar mark that knocks it out or what? No,
Speaker 1: because Tesla actually has a couple of cars well under
Speaker 1: price range. Last year we do this list every year.
Speaker 1: Last year we had the Model three on our list,
Speaker 1: and it is a fun car to drive, but we
Speaker 1: also like the way it look. But one of the
Speaker 1: reasons we didn't included this year was because of increasing
Speaker 1: competition for one thing, and a lot of us didn't
Speaker 1: care for that main central screen that controls everything. A
Speaker 1: more traditional screen uh with also gauges where you expect
Speaker 1: them to be, we thought was safer and more in
Speaker 1: line with what people would expect from a car. All right,
Speaker 1: so it was reviewed, but you just you guys just
Speaker 1: didn't really like it as much. Yeah, and it's a
Speaker 1: good car. I think if someone was looking for an
Speaker 1: inexpensive electric car that's fun and that's your main criteria,
Speaker 1: I would say you should be looking at cars like
Speaker 1: the Hyundai Kona, the Ford, Mustang Maki. And that's in
Speaker 1: addition to too many others that you know we have.
Speaker 1: Let's of ten, you can include everything. Let's talk about them,
Speaker 1: and that's fair And what's interesting. When I was looking
Speaker 1: at your list, I'm like, Wow, there's a fair amount
Speaker 1: of e vs out there. So walk us through the list.
Speaker 1: Some of the standouts based on your analysis. Well, one
Speaker 1: standout that's really telling is the new Chevy Bolt EUV
Speaker 1: and what that is is it's more of a crossover
Speaker 1: SUV type version of the Chevy Bolt we already know,
Speaker 1: So that tells you right there, Chevrolet knows something about
Speaker 1: making money and about making cars of people want crossover
Speaker 1: SUVs is where this is going. We also like the
Speaker 1: Twitter rap for Prime again same type of thing, the
Speaker 1: Volvo x C forty recharge and all electric small Volvo Suv.
Speaker 1: And then the Ford Mustang Maki, which is a Mustang
Speaker 1: in name, but it has more of a uh sits
Speaker 1: high up off the ground and has more of a
Speaker 1: crossover suv type of feel. Can you see You see
Speaker 1: a theme here? People like SUVs? Yeah? Well listen, right,
Speaker 1: I mean that's the one thing I guess when it
Speaker 1: comes to the e V market, right, do I mean?
Speaker 1: Do makers manufacturers need they need to be thinking about
Speaker 1: really kind of the cars people want to be driving
Speaker 1: if they're you know, hoping to kind of juice those
Speaker 1: e V purchase numbers. Right, that's exactly right now. There
Speaker 1: are plenty that aren't SUV based. For example, the Nissan
Speaker 1: Leaf is an affordable one that we like, um, but
Speaker 1: when it comes to cars like say the Hyundai I.
Speaker 1: Those aren't SUVs, that's just a regular car. But there's
Speaker 1: also a good number of plug in hybrids. We to
Speaker 1: put a couple of those on the list too, because
Speaker 1: we feel like it bridges the gap between fully electric
Speaker 1: and some concerns people might have and fully gas that
Speaker 1: has its own set of concerns. And one of the
Speaker 1: best of those is the Lincoln Aviator. It is the
Speaker 1: plug in hybrid that goes for electric only, then gas
Speaker 1: and electric combined to get great gas mileage. Well, you know,
Speaker 1: what is it that people want right now? What's the
Speaker 1: consumer demand? Do they want the hybrids? Do they want
Speaker 1: completely electric vehicles? What are still their concerns. I do
Speaker 1: feel like the infrastructure still lagging when it comes to
Speaker 1: supportive the electrical vehicle market, right I don't think that
Speaker 1: the confidence is there. So what people want our trucks
Speaker 1: and SUVs, and when you can give them an electric
Speaker 1: version of that, and this is the important part, convince
Speaker 1: them that they will never be without a way to
Speaker 1: refuel or recharge. That's when it's going to, you know,
Speaker 1: really make a difference. There's a lot of trucks coming,
Speaker 1: but they're just not here right now, Well, do you
Speaker 1: feel like with the President's infrastructure plan, and certainly there's
Speaker 1: allocation for things like this in building out the infrastructure
Speaker 1: for electric vehicles, we were going to need to have
Speaker 1: some kind of program like that in order for evs
Speaker 1: to really take off in this country. Probably, yes, um.
Speaker 1: But here's the one thing that concerns me is that
Speaker 1: if it was you know, the way the market works,
Speaker 1: the way the economy works is that it's it's market driven,
Speaker 1: it's demand driven. Competition makes great things. Why don't we
Speaker 1: see gas stations ramping up their electric charging stations to
Speaker 1: make stacks of money. I don't know the answer, but
Speaker 1: the fact that it's not happening makes me think that
Speaker 1: there's something that we are we aren't really aware of
Speaker 1: at this point. The cars are good and they can
Speaker 1: be charged up at home, but that's not enough for
Speaker 1: some people. Well, who against stations in the US? Are
Speaker 1: they franchises or they're owned by the big integrated oil
Speaker 1: companies who are kind of working their book there now,
Speaker 1: right and many are Many are franchises, so they would
Speaker 1: they're probably making more money on selling coffee and twinkies
Speaker 1: and they are selling gas. Yeah, it's interesting. Hey, when
Speaker 1: you look ahead to this year, I do feel like,
Speaker 1: all of a sudden, there is a lot of momentum.
Speaker 1: Whether it's Volkswagen, whether it's Mercedes, whether it's you know,
Speaker 1: pick your well known auto manufacturer. It does feel like,
Speaker 1: all of a sudden, everybody's all in on E VS. Yes.
Speaker 1: And I'll tell you something that you just mentioned that
Speaker 1: I find very encouraging. The Volkswagen I D for that
Speaker 1: you just mentioned is a very compiling car, no matter
Speaker 1: how it's powered. So it is an all electric car.
Speaker 1: That's the only way it comes. But it's good looking,
Speaker 1: it's fun to drive. The interior is great. The part
Speaker 1: that it's electric. I don't know that younger drivers are
Speaker 1: going to care that much as they get older. They
Speaker 1: just want something cool. That new Volkswagon is just cool,
Speaker 1: no matter what that was, of course. Brian Moody, executive
Speaker 1: editor for Auto Trader, So, Carol, I think one thing
Speaker 1: that's so fascinating about electric vehicles here in the United
Speaker 1: States is the fact that there are so many different players,
Speaker 1: but Tesla just dominates when it comes to mind share,
Speaker 1: when it comes to marketing, even though there's no actual
Speaker 1: formal marketing for Tesla. It's just the CEO, Elon Musk,
Speaker 1: is such a vocal proponent and he is out there
Speaker 1: talking about it, and he's got so many followers and fans. Well,
Speaker 1: he's a dynamic individual and he definitely has been a
Speaker 1: game changer. I think most people would agree. Go back
Speaker 1: a couple of years when it felt like the traditional
Speaker 1: automakers were taking their time when it came to e
Speaker 1: vs or hybrids, and all of a sudden, Lan Musk
Speaker 1: comes up and it kind of blows up the way
Speaker 1: we do things, and all of a sudden, everybody else
Speaker 1: wakes up as a result. Yeah. I think back to
Speaker 1: when Tesla for introduced its first cars, right, they did
Speaker 1: it at the really high end category was super super expensive,
Speaker 1: and the strategy has been to bring that price down
Speaker 1: and bring that entry point down, so it does get
Speaker 1: to that point where Cathy Wood says it is going
Speaker 1: to be significantly cheaper than buying an internal combustion vehicle.
Speaker 1: And I have to just say, like, you go out
Speaker 1: to the West Coast, you've always seen a fair amount
Speaker 1: of Tesla's that makes sense. It's where their first production
Speaker 1: plan and it's an environment that easily can do it.
Speaker 1: But I see a lot more here now on the
Speaker 1: East Coast. You know, It's something I talked to Dani
Speaker 1: Hole about, the Tesla reporter for Bloomberg News. She lives
Speaker 1: in California, and you know, whenever I go to California,
Speaker 1: see tesla's everywhere. But here in New York you're seeing
Speaker 1: more and more. But it's still something I notice. It's
Speaker 1: still something I notice when I see a Tesla, right,
Speaker 1: and there still needs to be more infrastructure. Everybody says
Speaker 1: that we'll still to come up on Bloomberg Business Week,
Speaker 1: where you hear from a member of New York City's
Speaker 1: founding families about protecting art and culture in a post
Speaker 1: pandemic world. You're listening to Bloomberg Business Week, and this
Speaker 1: is Bloomberg broadcasting from the financial capital of the world,
Speaker 1: Bloomberg eleven Frio in New York to Washington, d C.
Speaker 1: Bloomberg to Boston, Bloomberg one O six one to San Francisco,
Speaker 1: Bloomberg nine sixty to the country Sirius XM Chado one
Speaker 1: nine team, and around the globe the Bloomberg Business app
Speaker 1: and Bloomberg Radio dot Com. This is Bloomberg Business Week.
Speaker 1: So earlier this year, Bloomberg reported on how two thirds
Speaker 1: of New York City's arts and culture jobs were gone
Speaker 1: because of the global pandemic. Cultural organizations around the world
Speaker 1: have been heard hard. We know this because of the shutdown. Well,
Speaker 1: someone whose family has been involved in the arts and
Speaker 1: really is one of the countries iconic dynasties and one
Speaker 1: of New York City's founding families, Can Swallow Vanderbilt Coston, philanthropist, entrepreneur,
Speaker 1: co founder of soho mus. It's a professional networking website
Speaker 1: for the global creating community. And we started with a question.
Speaker 1: We ask a lot of guests, how has this past
Speaker 1: year been? You know, I think, as with everyone, that
Speaker 1: it's been incredibly challenging. Um. You know, I'm so grateful
Speaker 1: that both family and friends that everyone's healthy now, but
Speaker 1: you know, it's it's been just awful to watch, you know. UM.
Speaker 1: And I think just you know, I say that on
Speaker 1: one breath, obviously with it, you know, the totality rate
Speaker 1: of what's happened. Um, But on a positive note, I
Speaker 1: also look at I think there's been a lot of
Speaker 1: incredible growth and changes, and I hope that we can
Speaker 1: kind of keep to the lessons that we've learned. I mean,
Speaker 1: you know, keeping being simple and small right right, fingers
Speaker 1: crossed right, that we actually, you know, have learned something
Speaker 1: from this unfortunate time and and come out better on
Speaker 1: the on the other side. Exactly. One thing I want
Speaker 1: to ask you do work with an organization. You're co
Speaker 1: founder of pahomus talk to us about this world because
Speaker 1: you have a front row seat when it comes to
Speaker 1: folks in the art world who evolved in you know,
Speaker 1: the arts and culture. So tell us about kind of
Speaker 1: some of these stories. And I mean, I can only
Speaker 1: imagine that it's been a rough one this past year.
Speaker 1: So who used to kind of define as the LinkedIn
Speaker 1: for creative it's a membership based site and when we
Speaker 1: help and work with all different forms of the creative universe,
Speaker 1: so from musicians, dancers, writers, actors across the gamuts. Knowing
Speaker 1: that creatives really working projects. So if I'm putting together
Speaker 1: a music video feature film, UM, we really helped to
Speaker 1: procure job opportunities. Uh. We've just actually opened up a
Speaker 1: younger generation here called Pahomies World for kids for team
Speaker 1: and upwards UM and bringing in a home mentorship and
Speaker 1: master class programs to really help them, and so you know,
Speaker 1: it's our Our world is kind of a three sixty universe. UM,
Speaker 1: And right in the beginning of the pandemic, UM really
Speaker 1: started to see that a lot of our Broadway stars,
Speaker 1: artists that are normally on tour, we're suffering so much.
Speaker 1: So we created this series called saves Um, which is
Speaker 1: just extraordinary where you know, artists like Tiffany remember her,
Speaker 1: so you sold her million albums and and her doing
Speaker 1: acoustics performances, which she's never done before, and so she
Speaker 1: was really able to showcase a whole another side to her.
Speaker 1: You know what's interesting is you did have performers who
Speaker 1: were stuck home and all of a sudden, right they
Speaker 1: would normally be on tour, and I'm sure they can't
Speaker 1: wait to get back out on tour, but it was
Speaker 1: kind of interesting to see another way for them to
Speaker 1: reach their fans by being able to perform virtually. And
Speaker 1: I do wonder do you think some of that stays
Speaker 1: with us on the other side of the pandemic, not
Speaker 1: replacing you know, in person performances, if you will, but
Speaker 1: it's just another way to kind of reach out and
Speaker 1: maybe give access to people who maybe can't afford a
Speaker 1: ticket to something. It's just another venue, Carol. I absolutely
Speaker 1: believe that it's going to be something that it will
Speaker 1: be used and and kind of I think that where
Speaker 1: artists are actually found you know, comfort and even you know,
Speaker 1: whether it's testing new songs and doing things in a
Speaker 1: you know, a very very different medium than they normally
Speaker 1: have done. Um. I think this will absolutely be something
Speaker 1: that will surpass the pandemic. Conswello, we talked about how
Speaker 1: some of what artists had to do during the pandemic,
Speaker 1: whether it's virtual performances, that it stays with us uh
Speaker 1: and maybe perhaps that creates another revenue stream, especially if
Speaker 1: even for you know, start starting out artists or younger
Speaker 1: artists or smaller artists. And I do think it could
Speaker 1: be a very productive outcome on the other side of
Speaker 1: the pandemic. Do you agree? I absolutely agree, And I
Speaker 1: think just as you said, you know, for this younger talent,
Speaker 1: it's giving them an opportunity to test out new materials,
Speaker 1: to increase you know, kind of their fan base, and
Speaker 1: and to learn how it actually feels in a way
Speaker 1: that you know, be raw and vulnerable, which is you know,
Speaker 1: the wonderful thing about being an artist and um, and
Speaker 1: so yes, I really do. I think that it's as
Speaker 1: I said, I think this is gonna be something then
Speaker 1: absolutely post pandemic. You know when we look at YouTube
Speaker 1: and I mean, my goodness, Justin Bieble was discovered that way, right,
Speaker 1: So I think that, right, Yeah, I do. I think
Speaker 1: that a lot of great things will be coming from that.
Speaker 1: I do. This is something I thought a lot about,
Speaker 1: Carol over the last year, is is what art looks
Speaker 1: like on the other side of this, and what creators
Speaker 1: and artists did over the last year. It's been exhausting
Speaker 1: for a lot of people. But I just hope that
Speaker 1: we see a rising creativity, we see some just fantastic creators,
Speaker 1: we some fantastic artwork on the other side of this,
Speaker 1: and in a few years we can look back on
Speaker 1: this as a time when people got to reflect and create. Yeah.
Speaker 1: I hope so too. And I do think that once
Speaker 1: things reopen, we're gonna be back at museums, We're gonna
Speaker 1: be back seeing plays, We're going to be back doing
Speaker 1: all of it, going to concerts. That was Conswelo Vanderbilt,
Speaker 1: Custin philanthropist and entrepreneur, co founder of Shows. You're listening
Speaker 1: to Bloomberg Business Week. Coming up, we check in on
Speaker 1: the status of the cannabis into tree with the CEO
Speaker 1: of Truly. I'm just gonna say it's smoking. You've been
Speaker 1: waiting to do that. I have Sorry, this is Bloomberg.
Speaker 1: You're listening to Bloomberg Business Week with Carol Messer and
Speaker 1: Bloomberg Quick Takes Tim Stinovik from Bloomberg Radio. This week,
Speaker 1: Tim the unofficial official marijuana holiday. We're talking about four twenty.
Speaker 1: It did, though, give us an opportunity to check in
Speaker 1: on the cannabis business well. At the start of the year,
Speaker 1: Bloomberg reported that the cannabis industry is finally going to
Speaker 1: hit the gas pedal in and for more in the
Speaker 1: state of the business, we caught up with Kim River,
Speaker 1: CEO of the cannabis company Truly. It's a seed to
Speaker 1: Sail vertically integrated cannabis company. We asked her what the
Speaker 1: last year has been like. The year has been, uh,
Speaker 1: you know, incredibly busy. But you know, we've been very
Speaker 1: busy really since since the beginning of last year. Um,
Speaker 1: you know, we saw incredible increased demand throughout the COVID
Speaker 1: period and are now as we come out of COVID
Speaker 1: kind of have a little bit of a rebalance in
Speaker 1: terms of how our customers are doing business with us.
Speaker 1: But demand remains very very strong across all of the
Speaker 1: states that we that we do this. What does that
Speaker 1: rebalance mean? You say demand is strong? Is it not
Speaker 1: as strong as it was? And just talked to us
Speaker 1: attle bit about the rebound, So yeah, no, it is.
Speaker 1: So what I mean by that is when we entered
Speaker 1: uh so to give you a couple of quick stats
Speaker 1: UM for our business, and we have UM, you know,
Speaker 1: at that point in time, I think we had about
Speaker 1: I think around fifty or so stores UM open and
Speaker 1: so during that during that time before COVID, we had
Speaker 1: about seventy percent of our business was walk in, so
Speaker 1: just folks coming into our retail stores. About was you know,
Speaker 1: call ahead or online pickup, and then about ten percent
Speaker 1: was delivery. At the height of COVID, obviously that that
Speaker 1: behavior changed dramatically, and so about UM sixty percent was
Speaker 1: online or pre orders UM for pick up, about twenty
Speaker 1: percent was delivery, and then a small about ten percent
Speaker 1: was walk in business. And so we're seeing that shift
Speaker 1: back a bit, although interestingly, and I don't think this
Speaker 1: is unique for cannabis, but for for a lot of retailers.
Speaker 1: You know, interestingly, the pick up the online ordering at
Speaker 1: channel has remained very strong. So that's still at a
Speaker 1: round between fifty and fifty five percent, So that certainly
Speaker 1: was very sticky UM with deliveries going back down to
Speaker 1: that ten percent number that we saw pre COVID, but
Speaker 1: demand overall remains incredibly strong. So if we just used
Speaker 1: Florida as an example, when we exited twenty there were
Speaker 1: about two thousand, five hundred patients every week Florida Medical
Speaker 1: Program entering the program in Florida. Now in the last
Speaker 1: ten week average is at about fifty five hundred patients
Speaker 1: entering the program. So yeah, so it's it's been UM
Speaker 1: and you know, incredibly strong for as well UM in
Speaker 1: terms of new market entrance UM into across really all
Speaker 1: again all of the states. In Pennsylvania also a market
Speaker 1: where U there were active been UM that the patient's
Speaker 1: profile there in demand also is very very strong. In
Speaker 1: twenty one, Kim, I want to get your thoughts on HR.
Speaker 1: It's called the Safe Banking Act. The US House Representatives
Speaker 1: passed it and this would give state authorized marijuana business
Speaker 1: is easier access to banking services. This has been tough
Speaker 1: for for US business owners because you guys have been
Speaker 1: dealing in cash, right, Yes, so we we deal in
Speaker 1: either cash or um. We have partnered with a company
Speaker 1: called Canpaig, which, if you think about it, like a
Speaker 1: preloaded card. So if I'm a Starbucks addict, so a
Speaker 1: preloaded Starbucks card is is the easiest example. Um. And
Speaker 1: we're just starting to see some work arounds on the
Speaker 1: debit card side. But your point, Yes, it is primarily
Speaker 1: a cash based business. So this is a big deal
Speaker 1: because I mean, look the Democrats. Democrats have tried to
Speaker 1: pass this before, but they haven't controlled the House and
Speaker 1: the Senate previously. So if this goes through, that's really
Speaker 1: good news for you guys. Yeah, and it's it's good
Speaker 1: news part. So I'm and I will just tell you
Speaker 1: that certainly, um, in terms of being able to have
Speaker 1: you know, alternative payment methods is a big deal and
Speaker 1: it's certainly a big deal for our consumers. And from
Speaker 1: a safety and security standpoint, we do have armored car
Speaker 1: service and we you know, deposit directly into the Federal Reserve.
Speaker 1: So we've eliminated as many of those risks as possible
Speaker 1: to date, and we are able to bank what state
Speaker 1: chartered banks were just not able to bank with federally
Speaker 1: chartered banks for obvious reasons. So that would change that landscape.
Speaker 1: I would say. More importantly though, potentially, is the fact
Speaker 1: that we also don't have access to normalized banking or
Speaker 1: lending tools. So when you look at UM rates that
Speaker 1: cannabis businesses are forced to take it with really subprime
Speaker 1: you know lenders or more at more predatory rate system
Speaker 1: of my peers, for example, have been forced to take
Speaker 1: out to take to take that on at interest rates
Speaker 1: because again there's no access to normal tools. We can't
Speaker 1: get mortgages, we can't have business lines of credit UM.
Speaker 1: So that coupled with you know, the federal provisions under
Speaker 1: two a D which their taxation UM laws, we also
Speaker 1: can't take normalized deductions, so we don't have things like
Speaker 1: normal business deductions, whether that be depreciation or you know
Speaker 1: again UM just you know, expenses that you would normally
Speaker 1: be able to doctor as a business. And so those
Speaker 1: two things together make UM you know, make profitability very
Speaker 1: very difficult as a legal UM under state law cannabis operator.
Speaker 1: And so banking would certainly help on that first piece,
Speaker 1: and to again give us again of course being able
Speaker 1: to take other forms of payment, but also being able
Speaker 1: to work with um larger institutions and have access to
Speaker 1: normalized lending. And and if to a d E is
Speaker 1: lifted and that tax laws changed, what would that do
Speaker 1: to your profitability picture? Yeah, so last year it would
Speaker 1: have saved us about sixty three point five million dollars,
Speaker 1: so so making much more profitable. Yeah, it's much more
Speaker 1: profitable than m than than we I mean we we
Speaker 1: do run a profitable business, Garelian. But yes, it would
Speaker 1: it would be um, it would be a great, great help, Kim.
Speaker 1: Let's talk more about the industry at large. One thing
Speaker 1: that I was surprised to learn. Even in areas where
Speaker 1: marijuana is legal from addicinal or for recreational purposes, the
Speaker 1: illicit market continues to thrive. Um. Just one in three
Speaker 1: cannabis consumers in the US buys from established brick and
Speaker 1: mortar stores. That's according to survey published this month by
Speaker 1: New Frontier Data. The most popular source for means the
Speaker 1: users friends one other get their weed from dealers. How
Speaker 1: do you change that? Yeah? And I think that First
Speaker 1: of all, there has to be access, right, and it
Speaker 1: has to be easy and convenient for customers. And so
Speaker 1: even when we talk about you know, in in Florida,
Speaker 1: for example, we have delivery, which is oftentimes you know,
Speaker 1: next day or even the same day. However, the process
Speaker 1: to get delivery is very onerous for customers. So you
Speaker 1: have to be UM present, you have to assign for it.
Speaker 1: There's this again, this whole transaction that takes place, and
Speaker 1: it is UM, it's like waiting for it in some
Speaker 1: cases can be like waiting for the cable man, right,
Speaker 1: which no one wants to do that. So I think
Speaker 1: in some cases we need to make sure that cannabis
Speaker 1: is as convenient as the black market. UM. In many
Speaker 1: sophisticated black market areas, UM, it's you know, doorstep, it's quick, UM,
Speaker 1: it's convenient and UM. You know. So I do think
Speaker 1: that UM access and wider access is really important. And
Speaker 1: what does that look like though? Does that look like
Speaker 1: does that look like delivery? I mean, does it look
Speaker 1: like I'm just trying to think of what looks I think, yeah,
Speaker 1: I think it's a full omni chanal experience, right, I
Speaker 1: mean I think that certainly it does look like it
Speaker 1: does look like to live like Amazon for some and yeah,
Speaker 1: I mean Amazon, right, like like Amazon. I mean when
Speaker 1: we think about now, I don't think that you know,
Speaker 1: tomorrow we're going to have drones leaving cannabis on doorsteps.
Speaker 1: Well Amazon doesn't have it yet either, even though they've
Speaker 1: been talking about it for years. Yeah, but I do
Speaker 1: think that, right, I do think that when you think
Speaker 1: about even how far you know, alcohol delivery has come
Speaker 1: over the years and or you know, convenience um to
Speaker 1: to alcohol. Again, we have to make sure that this
Speaker 1: isn't getting in the hands of children, and it is
Speaker 1: a regulated product. There's certainly are going to be certain
Speaker 1: barriers um and it will remain a regulated industry. However,
Speaker 1: I do think that if the goal is to compete
Speaker 1: head to head with the black market, there needs to
Speaker 1: be one access into education and three, right, we have
Speaker 1: to be price competitive and product competitive with the black
Speaker 1: market as well. And so um which you know, again
Speaker 1: taking another queue from alcohol and how how we came
Speaker 1: out of prohibition UM with alcohol. A lot of that
Speaker 1: had to do with the fact that, um, we were
Speaker 1: able to educate customers on the safety right and how
Speaker 1: you know, how it was safer to to actually consume
Speaker 1: products from a regulated distributor as opposed to someone making
Speaker 1: bathtub gin. So I think similarly, right, and we saw
Speaker 1: that a little bit with a base gait crisis that
Speaker 1: happened UM last year with out in California and West
Speaker 1: Coast UM west on the West coast, you know, additives
Speaker 1: being added to black market products that were very very
Speaker 1: harmful UM forustomers when inhaled. And so I think that
Speaker 1: as again more wid widespread regulation happens across the country,
Speaker 1: hopefully at the federal level, you know, consumers will um
Speaker 1: will certainly you know, be drawn to m safer products. Hey,
Speaker 1: Kim one Quesson, I want to ask you, and just
Speaker 1: looking at your background, I mean you spent several years
Speaker 1: and in private practice as a lawyer where you were
Speaker 1: specializing the mergers and acquisitions, and I look at the
Speaker 1: cannabis industry and I'm just thinking it might be right
Speaker 1: for some more consolidation. What are your expectations there? Is
Speaker 1: that maybe in the game plan for you guys? You know,
Speaker 1: absolutely I believe that the cannabis um is certainly like
Speaker 1: any growth industries and you know, as as they evolve
Speaker 1: right there will be uh consolidation and meaningful consolidation across
Speaker 1: across the industry. Certainly also as we see UM the
Speaker 1: federal landscape shifting UM. So you know, we already have
Speaker 1: been active in in the M and A arena. We
Speaker 1: plans that continue continue to be active in that space.
Speaker 1: So certainly for us, and then I would assume for
Speaker 1: for many others, and I think that you absolutely will
Speaker 1: see consolidation happen over the next i'll call it twenty
Speaker 1: four months. That's Kim Rivers, the CEO of True Leaf, Carol,
Speaker 1: I gotta tell you, it feels like in the last
Speaker 1: couple of years, but especially this year, cannabis has gone
Speaker 1: from something that was really fringed to something that is
Speaker 1: seriously mainstream. Yeah. I think the November elections were a
Speaker 1: big deal when you saw more states endorsing it for
Speaker 1: either recreational or medical use. And I think that's a
Speaker 1: big deal. But as Kim mentioned to us, Kim Rivers,
Speaker 1: of course, the CEO of Truely, you know, one of
Speaker 1: the big things is federally getting some rules about the
Speaker 1: industry that would make banking much easier and you know,
Speaker 1: state to state business interactions a lot simpler. Yeah, serious
Speaker 1: economic implications for states as well if that happens. If
Speaker 1: you missed any of the conversation and the full conversation,
Speaker 1: you can find that on our podcast Speed and That
Speaker 1: wraps up the weekend edition to Bloomberg Business Week from
Speaker 1: Bloomberg Radio. Thanks so much for joining us. I'm Carol
Speaker 1: Masser and I'm Tim Stanovac. Be sure to tune into
Speaker 1: our Bloomberg Business Week daily show. It's Monday through Friday.
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Speaker 1: Have a great weekend. This is Bloomberg