WEBVTT - Micron Plunges On Weakness, Musk's Political Power 0:00:02.600 --> 0:00:11.559 Bloomberg Audio Studios, podcasts, radio news. 0:00:09.480 --> 0:00:13.160 From the Heart where Innovation, money and power Collie in 0:00:13.240 --> 0:00:14.720 Silicon Valley, Nbon. 0:00:15.080 --> 0:00:19.600 This is Bloomberg Technology with Caroline Hyde and Ed Ludlove. 0:00:32.960 --> 0:00:33.640 Live from New York. 0:00:33.720 --> 0:00:37.839 As the Blomberg Technology coming up, Micron planets after reporting earnings, 0:00:37.880 --> 0:00:40.240 and AI just couldn't make up for the smartphone and 0:00:40.280 --> 0:00:44.160 PC cheap weakness. Plus Elo Musk wielding his political power 0:00:44.440 --> 0:00:47.160 as the US now risks a government shutdown. We discuss 0:00:47.200 --> 0:00:50.920 as impact on the next stopgap bill, and Apple holds 0:00:50.960 --> 0:00:54.720 its plans for an iPhone hardware subscription service. This and 0:00:54.880 --> 0:00:58.040 much more on Apple News later this hour. But first 0:00:58.280 --> 0:01:01.400 weche can on one key stock. It is down more 0:01:01.440 --> 0:01:03.840 than seventeen percent and it is having its worst day 0:01:04.200 --> 0:01:08.600 since March twenty twenty. Micron really slumping on the back 0:01:08.600 --> 0:01:11.160 of its numbers, and we get straight to it the why, 0:01:11.480 --> 0:01:14.120 the how, as you see that it eradicates most of 0:01:14.120 --> 0:01:15.520 its gains year to date. 0:01:16.000 --> 0:01:18.039 We go to Blue meg Intelligence analyst Jake. 0:01:17.920 --> 0:01:21.679 Silverman first, whose report lays out that the outlook missed 0:01:21.720 --> 0:01:24.720 by twelve percent and week a smartphone PC in auto 0:01:24.800 --> 0:01:25.400 bit demand. 0:01:25.720 --> 0:01:26.039 This is it. 0:01:26.080 --> 0:01:28.800 We were all really excited about high bandwidth memory for 0:01:28.840 --> 0:01:31.039 AI applications, but really it comes back to you and 0:01:31.080 --> 0:01:32.280 me not buying more phones. 0:01:33.040 --> 0:01:33.280 Yeah. 0:01:33.319 --> 0:01:36.000 Well, look, there was definitely an inventory correction to some 0:01:36.120 --> 0:01:39.319 extent for fiscal two Q and this was starting to 0:01:39.400 --> 0:01:41.920 happen earlier this year. Actually we're starting to see this 0:01:41.959 --> 0:01:45.960 in June, July, August, and the reason primarily was to 0:01:46.040 --> 0:01:49.760 build the inventory ahead of price increases that did occur 0:01:50.280 --> 0:01:52.720 but now are starting to impact the company's demand. 0:01:53.200 --> 0:01:53.559 I see. 0:01:53.600 --> 0:01:56.720 So Sanja Marotra is really trying to set and spell 0:01:56.760 --> 0:01:58.880 out that the second half it's going to turn around. 0:01:58.920 --> 0:02:01.280 We're actually going to see maybe even a growth of 0:02:01.320 --> 0:02:04.080 the PC market of some five percent in twenty twenty five. 0:02:04.200 --> 0:02:07.600 But what spurs that, Well, there's typical seasonal demand, so 0:02:07.720 --> 0:02:10.480 we would hope to see seasonal growth in the second 0:02:10.480 --> 0:02:13.800 half regardless. But there's also the opportunity where there's content 0:02:13.919 --> 0:02:19.799 expansion within AIPCS AI smartphones, So there's an opportunity there. 0:02:19.880 --> 0:02:22.120 Whether or not that occurs, I think that still remains 0:02:22.160 --> 0:02:24.760 to be seen, but there's still optimism that there can 0:02:24.760 --> 0:02:26.560 be growth in the second half of the year versus 0:02:26.560 --> 0:02:27.120 the first half. 0:02:27.200 --> 0:02:28.639 So look, as we're try and get our head. 0:02:28.480 --> 0:02:32.320 Around the actual demand for AI in the consumer radiator department. 0:02:32.600 --> 0:02:35.640 In the data center, it is then, what four hundred 0:02:35.720 --> 0:02:39.919 percent growth in terms of their AI demand and sales. 0:02:40.440 --> 0:02:42.799 Why is that not bringing in enough revenue yet? 0:02:42.800 --> 0:02:43.000 Though? 0:02:43.280 --> 0:02:45.320 Well, so, they do have a number of products that 0:02:45.360 --> 0:02:48.760 are really impacting data center and demand. So high bandwidth 0:02:48.800 --> 0:02:51.240 memory is probably the most talked about, but it's actually 0:02:51.280 --> 0:02:54.160 still the most nascent for them. It's really not generating 0:02:54.200 --> 0:02:55.680 the bulk of the growth yet. 0:02:56.680 --> 0:02:58.679 So they still have other products. 0:02:58.200 --> 0:03:04.000 Like high capacity DRAM modules, stems, LPDDR five. They're really 0:03:04.040 --> 0:03:07.120 for servers, both AI and traditional compute. Traditional compute was 0:03:07.160 --> 0:03:11.120 actually a bit better than had been previously anticipated. But 0:03:11.440 --> 0:03:14.519 on the other hand, there's also data center SSDs, which 0:03:14.560 --> 0:03:17.200 seemed to be moderating near term, where they had been 0:03:17.200 --> 0:03:21.720 experiencing some pretty tremendous growth beforehand and had been benefiting 0:03:21.720 --> 0:03:24.119 a lot from share gains as well well. 0:03:24.280 --> 0:03:26.920 With meg Intelligence analyst Jake Silvan breaking down what is 0:03:27.120 --> 0:03:30.800 a pretty painful day in HQ in Voise, Idaho. But 0:03:30.919 --> 0:03:33.520 now let's go out to an investor in the scene. 0:03:33.560 --> 0:03:36.440 Kim forest Cio of Boca Capital Partners thirty five million 0:03:36.480 --> 0:03:39.840 dollars in assets under management, and Kim, you'll take on 0:03:39.920 --> 0:03:42.720 what is a absolute punishment on the stop today. 0:03:43.480 --> 0:03:47.480 Absolutely, Well, I've been doing this for her number of years, 0:03:47.560 --> 0:03:51.040 since nineteen ninety nine. And well I was a sales 0:03:51.080 --> 0:03:53.920 side analyst and a biside analyst than a PM then 0:03:54.240 --> 0:03:57.240 chief investment officer of my own firm. That being said, 0:03:57.400 --> 0:04:00.800 this is not my first day at this rodeo and 0:04:01.520 --> 0:04:04.720 Micron in particular, and all the memory kind of companies 0:04:05.040 --> 0:04:08.640 seem to have this boom bust cycle, and the boom 0:04:08.680 --> 0:04:11.400 and bust can be really close to each other, as 0:04:11.520 --> 0:04:14.080 evidenced by the price chart of Micron. 0:04:14.760 --> 0:04:18.599 So what's an investor to do? Well? Some people would 0:04:18.640 --> 0:04:19.440 like to be able. 0:04:19.240 --> 0:04:22.279 To trade this know when to go in low, you 0:04:22.320 --> 0:04:25.120 know when the high is God bless you on that. 0:04:25.560 --> 0:04:27.840 I think what you have to do is look at 0:04:27.880 --> 0:04:34.040 Micron and say it has terrific growth. There are very 0:04:34.080 --> 0:04:37.719 few players in this space. There's maybe six or seven 0:04:37.760 --> 0:04:43.360 companies that are competitors, and for the most part, sometimes 0:04:43.400 --> 0:04:46.640 bad things like this happen, but sometimes good things happen too. 0:04:47.120 --> 0:04:49.719 And to be able to trade around that around these 0:04:49.720 --> 0:04:54.320 events where there's a sudden shortfall in demand, but it 0:04:54.360 --> 0:04:57.000 will be made up. I think it's more of a 0:04:57.000 --> 0:05:00.240 buying opportunity than getting out now. The other thing is is, 0:05:00.600 --> 0:05:02.880 if you look at that chart, some people bought it 0:05:03.000 --> 0:05:05.920 at much higher prices this year, and it could be 0:05:06.080 --> 0:05:10.279 tax lost selling going on that's really driving the price 0:05:10.400 --> 0:05:11.359 down today. 0:05:11.640 --> 0:05:13.800 So there's a seasonality element to all of this. It's 0:05:13.800 --> 0:05:16.200 interesting if you go to analyst recommendations at the moment, 0:05:16.800 --> 0:05:18.760 a lot of people cut their price targets, but still 0:05:18.760 --> 0:05:20.720 you've got thirty seven buys on this stock, You've only 0:05:20.800 --> 0:05:23.760 got one cell, and the overall consensus for price target 0:05:23.800 --> 0:05:26.000 it's still at one hundred and thirty five. You've got 0:05:26.040 --> 0:05:28.560 room to run up from an eighty five dollars. 0:05:28.600 --> 0:05:30.839 But how does Sanjay Morotra. 0:05:30.680 --> 0:05:32.599 Get us there in terms of what he needs to 0:05:32.640 --> 0:05:33.800 signal now to the market. 0:05:33.800 --> 0:05:34.520 How much can he. 0:05:34.839 --> 0:05:38.960 Say, look, put aside China, put aside my exposure to 0:05:39.360 --> 0:05:41.400 the consumer, I'm all in on AI. 0:05:42.360 --> 0:05:44.320 Well, I think he made the case that he's all 0:05:44.320 --> 0:05:47.560 in on AI right, Like they have the products that 0:05:47.680 --> 0:05:52.440 AI wants and needs. AI for many reasons, has saved 0:05:52.440 --> 0:05:56.680 this market, right. I mean in video and meta certainly 0:05:56.720 --> 0:06:00.520 have driven it. But the real issue here is the 0:06:00.560 --> 0:06:06.240 AI people are buying stuff and building out their data centers, 0:06:06.640 --> 0:06:09.039 and I don't know that that's going to stop in 0:06:09.240 --> 0:06:11.839 any you know, definable time. 0:06:12.040 --> 0:06:14.000 And I did you sorry just so, But in that Kim, 0:06:14.040 --> 0:06:17.560 did you get that sort of easing of any anxiety, 0:06:18.120 --> 0:06:20.880 whether or not it was closely held or far away 0:06:20.960 --> 0:06:23.680 that we might be at some pivot point where the 0:06:23.680 --> 0:06:24.839 demand does start. 0:06:24.560 --> 0:06:25.080 To ease up. 0:06:25.640 --> 0:06:26.000 Sure? 0:06:26.120 --> 0:06:29.600 I mean, well, here's here's what investors really have to understand. 0:06:30.600 --> 0:06:35.760 Micron is a very small world in which all of 0:06:35.800 --> 0:06:38.359 its clients are either all on or all off, or 0:06:38.400 --> 0:06:39.159 so it seems. 0:06:39.640 --> 0:06:41.599 And if you remember when we were. 0:06:41.440 --> 0:06:47.120 Building out regular cloud database or cloud data centers, it's lumpy. 0:06:47.200 --> 0:06:49.640 And what I mean by that is you're either. 0:06:49.520 --> 0:06:52.159 Building out or you're not, and all of a sudden 0:06:52.200 --> 0:06:55.680 it can stop. And whenever several companies that have been 0:06:55.680 --> 0:07:00.360 building out data centers stopped, you know, the providers get clover. 0:07:00.640 --> 0:07:03.880 That's just the nature of this, and we don't know 0:07:03.960 --> 0:07:07.400 when it's going to stop. So investors have to be 0:07:07.440 --> 0:07:10.440 aware that we're not going to be spending in perpetuity to. 0:07:10.400 --> 0:07:11.200 Build out AI. 0:07:11.680 --> 0:07:13.160 There will be a day. 0:07:13.240 --> 0:07:16.600 When people take a pause and actually have to you know, 0:07:16.800 --> 0:07:20.000 reap the rewards of building this product and you know, 0:07:20.120 --> 0:07:21.320 having people pay for the. 0:07:21.280 --> 0:07:24.280 Service these mega clusters at a moment though that we 0:07:24.320 --> 0:07:26.600 seem to be seeing is not a signal of us 0:07:26.840 --> 0:07:31.640 pulling back anytime soon. But does macro policy, does a 0:07:31.680 --> 0:07:34.800 new administration in any way dampen the spirits or only 0:07:34.840 --> 0:07:35.520 accelerate them? 0:07:35.560 --> 0:07:38.880 Kim, It doesn't seem so, because the companies that are 0:07:38.880 --> 0:07:42.280 building these data centers out have enough money from what 0:07:42.360 --> 0:07:44.840 they're doing now. They don't need to be able to 0:07:44.880 --> 0:07:47.560 say in the future, I'll be able to you know, 0:07:48.160 --> 0:07:50.960 in some very definable timeline, I need to get my 0:07:51.040 --> 0:07:53.720 money back. So they are going to be building these 0:07:53.760 --> 0:07:56.360 things out because they have the cash flow. And I'm 0:07:56.400 --> 0:08:01.840 talking to about Microsoft, Google and Meta, their regular businesses 0:08:01.960 --> 0:08:06.160 are providing the capital to build out data centers. 0:08:06.560 --> 0:08:08.960 So you said this potentially could be a buying moment 0:08:09.040 --> 0:08:12.160 for Micron. What about the chip space more broadly, because 0:08:12.200 --> 0:08:16.480 everyone's been suddenly in on this focus on software trade. 0:08:16.800 --> 0:08:19.080 Right, Well, I think it's great, Like at some point 0:08:19.200 --> 0:08:20.960 software has to come back to winning. 0:08:21.320 --> 0:08:23.440 I used to be a software engineer and I. 0:08:23.440 --> 0:08:26.440 Would love to be able to like buy a good 0:08:26.600 --> 0:08:30.080 software company that I think will grow again in perpetuity. 0:08:30.120 --> 0:08:31.640 I like moneymaking machines. 0:08:32.120 --> 0:08:34.920 Microsoft has been that, although it had a lull in 0:08:35.000 --> 0:08:38.400 the you know, twenty ten to twenty fourteen range something 0:08:38.440 --> 0:08:42.280 like that. But yeah, software is great, but hardware is 0:08:42.440 --> 0:08:47.120 what is driving me crazy right now, because it seems 0:08:47.200 --> 0:08:49.760 there is no lack of demand and I think the 0:08:49.880 --> 0:08:51.400 software will follow. 0:08:51.840 --> 0:08:52.120 Now. 0:08:52.559 --> 0:08:56.440 A lot of people are Momentum investors, and I worry 0:08:56.480 --> 0:08:59.920 about Nvidia about that because Broadcom's kind of taken all 0:09:00.160 --> 0:09:02.479 or Era out of the room for Nvidia. 0:09:03.559 --> 0:09:06.440 Kim Forest just dampening our animal spirits when it comes 0:09:06.520 --> 0:09:08.520 to some of the key trades that have been in 0:09:08.559 --> 0:09:11.280 this here, Kim, we so appreciate it. Boca Capital Partners 0:09:11.320 --> 0:09:14.480 wishing you happily holidays, just cio there. Meanwhile, look, the 0:09:14.480 --> 0:09:17.400 Biden administration has cemented a deal to give sk Heinex, 0:09:17.440 --> 0:09:20.480 course another high bandwidth memory maker, close to four hundred 0:09:20.480 --> 0:09:22.760 and sixty million dollars in grants and five hundred million 0:09:22.960 --> 0:09:25.720 in loans. This is to support a facility in Indiana 0:09:25.920 --> 0:09:28.319 which will focus on packaging chips sent to the US 0:09:28.360 --> 0:09:30.160 from sk Heinex plants in South Korea. 0:09:30.360 --> 0:09:32.040 The deal is a key part of. 0:09:32.080 --> 0:09:36.160 US efforts to build a domestic semiconductor supply chain. Now 0:09:36.240 --> 0:09:39.600 coming up, Elon Musk's influence in Washington being felt already 0:09:39.840 --> 0:09:42.439 as he helps kill a stop gap funding bill. More 0:09:42.480 --> 0:09:55.840 on that next, this is blue Meg Technology. The last 0:09:55.880 --> 0:09:58.760 minute government funding bill has been scrapped by House Speaker 0:09:58.840 --> 0:10:02.920 Mike Johnson after urged lawmakers and President elect Trump to 0:10:03.000 --> 0:10:05.200 risk a government shutdown rather than accept for post stop 0:10:05.240 --> 0:10:05.680 gap bill. 0:10:06.040 --> 0:10:08.040 Room mergs Mike Shephard joins us for more. 0:10:07.960 --> 0:10:11.600 And if anyone had potentially been doubting or questioning the 0:10:11.600 --> 0:10:13.560 influence of being on Musk, that proved wrong. 0:10:13.600 --> 0:10:18.080 Here those doubts were erased. And in resounding forum yesterday 0:10:18.200 --> 0:10:21.839 it was almost like on cue. We saw Elon Musk 0:10:22.080 --> 0:10:26.239 use the power of his x ex social media platform 0:10:26.679 --> 0:10:31.160 to gin up opposition and amplify it very quickly and 0:10:31.240 --> 0:10:35.280 within ours. President elect Donald Trump and Vice President elect JD. 0:10:35.480 --> 0:10:38.800 Vance chimed in and said that day two oppose this 0:10:38.920 --> 0:10:42.760 spending deal, which have been negotiated for weeks, if not months, 0:10:43.080 --> 0:10:45.520 to try to revert a government shutdown that will come 0:10:45.880 --> 0:10:49.600 as soon as Saturday morning if lawmakers can't go back 0:10:49.640 --> 0:10:52.440 to the drawing board and put together something on the fly, 0:10:52.640 --> 0:10:54.880 which looks really unlikely right now. 0:10:55.080 --> 0:10:57.160 Republicans saying that that phone has been ringing off the 0:10:57.160 --> 0:10:59.320 hooks on the back of this call to arms. 0:10:59.080 --> 0:11:01.160 To call your lawmaker, hasn get it taken off. 0:11:01.679 --> 0:11:04.960 He's shown his political clout, but behind the scenes, he's 0:11:05.000 --> 0:11:08.160 also building a team, taking expertise from those he knows 0:11:08.160 --> 0:11:10.520 already and indeed attending every meeting that seems to be 0:11:10.520 --> 0:11:10.760 going on. 0:11:10.760 --> 0:11:11.320 In mar Laga. 0:11:11.440 --> 0:11:13.960 Well, you're right, Caroline, because what we've also seen is 0:11:14.160 --> 0:11:18.080 Musk using this bully pulpit of X to also give 0:11:18.160 --> 0:11:21.680 wing to this venture that Donald Trump appointed him and 0:11:21.840 --> 0:11:24.359 Vivek Ramaswami, one of Trump's campaign. 0:11:24.040 --> 0:11:24.800 Rivals, to lead. 0:11:24.840 --> 0:11:28.080 That's the Department of Government Efficiency. Now keep in mind 0:11:28.160 --> 0:11:31.480 it's not really a department. It wasn't an agency created 0:11:31.520 --> 0:11:34.160 by Congress. But its goal is to do kind of 0:11:34.200 --> 0:11:38.000 what they're asking for in their social media communications yesterday, 0:11:38.160 --> 0:11:41.319 and that is cut down the size of government, reduced spending, 0:11:41.440 --> 0:11:46.160 reduced the scope of government. And this entity, if you will, 0:11:46.320 --> 0:11:49.160 lack of a lack of a better run, we'll call 0:11:49.200 --> 0:11:51.760 it that. It is still taking shape, but we do 0:11:51.840 --> 0:11:54.040 know that they are hiring. Thanks for really great scoop 0:11:54.080 --> 0:11:57.160 by our colleagues yesterday, we already know that they have 0:11:57.240 --> 0:12:00.480 hired about ten people. And Elon Musk has into an 0:12:00.520 --> 0:12:04.360 executive from the boring company and a former Trump Chief 0:12:04.400 --> 0:12:08.960 technology officer in his administration the prior administration, to lead 0:12:09.000 --> 0:12:12.040 the hiring push. They've been talking to candidates. They're looking 0:12:12.040 --> 0:12:19.040 for software engineers, including folks with artificial intelligence expertise, and 0:12:19.120 --> 0:12:21.160 the idea is that they would apply that to the 0:12:21.280 --> 0:12:24.120 vast reams of government data, perhaps to try to figure 0:12:24.160 --> 0:12:26.360 out what are the efficiencies that could be gained. 0:12:26.720 --> 0:12:28.440 I want to where that talent comes from, because of 0:12:28.440 --> 0:12:30.960 course he's been busy hiring an XAI in that department too. 0:12:31.240 --> 0:12:33.880 Mike Shepard a joy to have him here in New York. 0:12:34.280 --> 0:12:36.679 Let's just talk a little bit about lev space more 0:12:36.679 --> 0:12:39.080 broadly as well, because Tesla is in early talks. We 0:12:39.160 --> 0:12:41.920 understand the city of Austin about rolling out a fleet 0:12:41.920 --> 0:12:43.199 of autonomous vehicles. 0:12:42.880 --> 0:12:43.920 As early as next year. 0:12:43.960 --> 0:12:47.640 In emails acquired by Bloomberg, Tesla employees have been communicating 0:12:47.640 --> 0:12:49.880 with the Texas city, so it's at least May to 0:12:49.960 --> 0:12:53.200 establish safety expectations for the vehicles. The emails go on 0:12:53.320 --> 0:12:55.920 further saying that Tesla has not yet finalized its decision 0:12:56.360 --> 0:12:59.760 for an Austin deployment. Let's stick on Tesla, Let's stick 0:12:59.760 --> 0:13:02.360 on EV landscape, Let's stick on all things in La 0:13:02.400 --> 0:13:04.680 Mosque as well, and how all of this is set 0:13:04.720 --> 0:13:07.880 to change under the twenty twenty five percent and Electrump administration, 0:13:08.000 --> 0:13:11.000 and maybe we see some of those EV incentives wound down, 0:13:11.080 --> 0:13:14.160 even a possibility of fast tracking autonomous driving too. We've 0:13:14.160 --> 0:13:16.480 got a perfect person, Steve Westley's with us Wesley Group 0:13:16.520 --> 0:13:18.600 managing partner, who used to be on the border of 0:13:18.640 --> 0:13:20.760 the EV giant as well as your key player in 0:13:20.800 --> 0:13:24.120 California politics, and therefore this is the perfect dimension to 0:13:24.120 --> 0:13:26.600 discuss this with you. How are you thinking the EV 0:13:26.760 --> 0:13:29.760 landscape changes come January twentieth, Well, look. 0:13:29.800 --> 0:13:31.280 Let's look at the big picture first. 0:13:32.000 --> 0:13:35.239 So people are saying EV growth is slowing down, nonsense. 0:13:35.400 --> 0:13:38.480 One out of five of all cars sold globally in 0:13:38.520 --> 0:13:40.959 twenty twenty four will be electric or hybrid. So we're 0:13:41.000 --> 0:13:43.080 living in an EV world and it's just moving faster. 0:13:43.360 --> 0:13:48.040 That's twenty five percent year over year growth, seventeen million 0:13:48.080 --> 0:13:52.400 evs sold, globally, US Canada a solid growth about twelve percent, 0:13:52.840 --> 0:13:56.439 China red hot at forty percent. The big stories is 0:13:56.480 --> 0:13:59.520 you talked about are kind of tesla versus byd. 0:13:59.280 --> 0:14:01.080 Who's going to be global leader? 0:14:01.559 --> 0:14:04.640 And then there's this other issue of US versus China 0:14:04.679 --> 0:14:07.040 and how are terrorists going to affect this? And what 0:14:07.120 --> 0:14:11.360 people have to remember US has already slapped terriffs on 0:14:11.480 --> 0:14:13.360 any Chinese car sold in the US. 0:14:13.920 --> 0:14:15.400 But that's firstly none. 0:14:15.600 --> 0:14:17.400 You've got to ask the question of what happens at 0:14:17.400 --> 0:14:21.280 the Chinese slap one hundred percent terriffs on US cars 0:14:21.480 --> 0:14:22.840 or automakers. 0:14:22.200 --> 0:14:23.240 Selling cars that happened. 0:14:23.320 --> 0:14:25.360 Do you think there's a high risk even for a tesla? 0:14:26.040 --> 0:14:26.440 Oh? 0:14:26.440 --> 0:14:30.640 Look, whatever, there are terrifts slapped on by one country 0:14:30.680 --> 0:14:33.400 or another, you've got to expect the other country to respond. 0:14:33.440 --> 0:14:36.640 The big question is is that cars that are already 0:14:36.640 --> 0:14:39.200 made in that country are just cars that come so 0:14:39.360 --> 0:14:40.760 from the US going to China. 0:14:40.800 --> 0:14:42.600 But the pastline's the same. 0:14:42.920 --> 0:14:46.520 There's a lot more US automakers selling cars into China 0:14:46.600 --> 0:14:47.560 than vice versus. 0:14:47.560 --> 0:14:49.560 So the US needs to be careful at in this one. 0:14:49.800 --> 0:14:53.720 And yet we have seen vibes or whether it be 0:14:53.840 --> 0:14:57.880 real political clout driving testa share price up into the right. 0:14:57.920 --> 0:15:01.040 Ever since the results of the election, has any. 0:15:00.840 --> 0:15:03.920 Of this China US tension been priced in, do you think, 0:15:03.960 --> 0:15:05.520 Steve Well? 0:15:05.680 --> 0:15:08.000 I think people don't have their arms around it quite yet. 0:15:08.040 --> 0:15:10.280 So you've got to look at the Tesla share price. 0:15:10.880 --> 0:15:14.440 Seventy six percent growth since January one of this year. 0:15:14.520 --> 0:15:18.080 That's astonishing. The big question is can Tesla keep it up? 0:15:18.360 --> 0:15:21.440 And I think it's going to be tough without getting 0:15:21.520 --> 0:15:25.200 some new products into the market. Tesla's auto growth this year, 0:15:25.440 --> 0:15:29.080 you know, after roaring sales growth in twenty twenty one 0:15:29.200 --> 0:15:33.560 and twenty twenty two of fifty one percent and seventy percent, 0:15:33.880 --> 0:15:37.120 this year it's darn year flat. So Tessa's got to 0:15:37.160 --> 0:15:39.680 get this new lower cost car into the market. There 0:15:39.680 --> 0:15:42.000 are new rumors that there's going to be a new 0:15:42.320 --> 0:15:46.240 sub thirty thousand dollars model Q coming sometime in twenty 0:15:46.280 --> 0:15:49.360 twenty five, but we've got to make sure that that's real, 0:15:49.400 --> 0:15:51.760 so investors have to look at it. I think twenty 0:15:51.760 --> 0:15:53.880 five is going to be a make or break year. 0:15:54.120 --> 0:15:56.640 It could see new heights if you can see a 0:15:56.680 --> 0:16:00.520 lower cost car coming out and full self driving improve 0:16:01.120 --> 0:16:03.240 but it can also sink if they don't get a 0:16:03.240 --> 0:16:05.560 new car to market sales stay flat. 0:16:06.000 --> 0:16:07.240 That's going to scare people. 0:16:07.280 --> 0:16:11.120 Now as an investor, though, Steve, as an investor, how hard. 0:16:10.800 --> 0:16:12.480 Has it been to read the tea leads? 0:16:12.880 --> 0:16:15.520 Because we're trying to understand as to whether they're just 0:16:15.560 --> 0:16:18.520 going to cut costs of current models on the market 0:16:18.560 --> 0:16:21.720 and get us to some sort of sense of affordability. 0:16:21.160 --> 0:16:22.920 Because Elon just signals. 0:16:22.520 --> 0:16:25.280 Time and time again he's more interested in the robotaxi 0:16:25.360 --> 0:16:27.840 side and the full sife driving side. 0:16:28.080 --> 0:16:29.440 It's incredibly hard. 0:16:29.480 --> 0:16:33.600 I mean, share price going up seventy five percent when 0:16:33.640 --> 0:16:34.480 sales are flat. 0:16:34.680 --> 0:16:37.040 I don't think anybody's ever seen anything like that before. 0:16:37.200 --> 0:16:40.400 What's going on kind of a bet on full self 0:16:40.440 --> 0:16:44.760 driving and probably a bigger bet on Musk's relationship with 0:16:44.880 --> 0:16:48.040 President Trump. What no one's talking about is very quietly, 0:16:48.120 --> 0:16:51.479 the energy vision looks like the saving grace for Tesla 0:16:52.240 --> 0:16:54.360 seventy five percent year over year growth. 0:16:54.400 --> 0:16:56.480 The other thing investors have to get their. 0:16:56.480 --> 0:16:59.600 Arms around is auto companies aren't just auto companies anymore. 0:16:59.600 --> 0:17:03.160 They're also or energy companies too, and it's a whole 0:17:03.200 --> 0:17:03.520 new world. 0:17:03.560 --> 0:17:04.440 You've got to pay attention. 0:17:04.800 --> 0:17:06.919 I got to pay attention to the politics involved in it. 0:17:07.000 --> 0:17:09.480 This week, of course we saw that again California is 0:17:09.520 --> 0:17:12.440 really going to be focusing in on in shoring, EV adoption, 0:17:12.560 --> 0:17:15.440 Steve where you sit. But also we've got a news 0:17:15.480 --> 0:17:19.360 story around the potential unionization let's call it subtly being 0:17:19.400 --> 0:17:20.520 done over with Rivian. 0:17:20.560 --> 0:17:22.119 We understand the UAWS reached a. 0:17:22.160 --> 0:17:25.480 Kind of secret deal with Rivian to make unionization easier 0:17:25.800 --> 0:17:27.800 as and when it becomes a profitable company. 0:17:28.160 --> 0:17:28.960 How much you think. 0:17:28.800 --> 0:17:31.320 That's a key area the labor side of things to 0:17:31.359 --> 0:17:32.080 the EV space. 0:17:32.680 --> 0:17:36.160 Well, look, the labor side's huge because labor costs are 0:17:36.160 --> 0:17:38.120 going up. This is one of the things that's plagued 0:17:38.200 --> 0:17:42.400 GM and Forward for years. And what's interesting is must 0:17:42.480 --> 0:17:44.960 it's great at pulling out all the stuff, making things 0:17:45.000 --> 0:17:47.879 go faster than any of the automaker, but he still 0:17:47.920 --> 0:17:50.760 has to deal with unions. And he may be the 0:17:50.800 --> 0:17:52.919 well dis guy in the world, but that's not going. 0:17:52.800 --> 0:17:53.920 To impact. 0:17:54.960 --> 0:18:00.640 How well with union battles German workers potential the outline 0:18:00.640 --> 0:18:04.080 strike soon precisely when he's trying to catch up for 0:18:04.119 --> 0:18:06.200 a Q four sales. So it's going to be interesting 0:18:06.240 --> 0:18:09.920 to see can Tessela's auto sales increase this year. You 0:18:10.040 --> 0:18:12.639 can I show your over year growth. Gosh, that's going 0:18:12.680 --> 0:18:15.040 to be a tough one to sell to shareholders. 0:18:15.080 --> 0:18:15.760 We'll see. 0:18:16.080 --> 0:18:18.680 And you are a long time shareholder and an influential 0:18:18.680 --> 0:18:20.439 one of that, Steve Wesley. We thank you of the 0:18:20.440 --> 0:18:30.480 Wesley Group time now for talking tech. 0:18:30.480 --> 0:18:31.000 First up. 0:18:31.240 --> 0:18:34.399 Apple has halted its project building out an iPhone hardware 0:18:34.400 --> 0:18:37.840 subscription service it's acording to sources, the idea was to 0:18:37.880 --> 0:18:40.520 make owning an iPhone like subscribing to an app, with 0:18:40.600 --> 0:18:43.120 consumers paying monthly fees to get a new phone each year. 0:18:43.400 --> 0:18:47.520 Apple has since disbanded and reassigned the team to other projects. Plus, 0:18:47.560 --> 0:18:50.679 the European Commission is pushing Apple to further open up 0:18:50.680 --> 0:18:53.800 its iPhone operating systems to rivals. Commission instructed the tech 0:18:53.800 --> 0:18:57.320 giant on Wednesday to rework iOS so that devices like 0:18:57.320 --> 0:19:01.240 smart watches, earbuds, headsets from rivals more compatible with the 0:19:01.280 --> 0:19:05.199 Apple ecosystem, and Apple is close to getting Indonesia to 0:19:05.280 --> 0:19:07.560 lift its ban on iPhone sixteen sales, this after the 0:19:07.560 --> 0:19:10.680 country's president gave his approval for a one billion dollar 0:19:10.760 --> 0:19:11.919 investment from the tech giant. 0:19:12.280 --> 0:19:13.600 Again, according to sources. 0:19:13.640 --> 0:19:16.840 Indonesia First Band remembers sales with the flagship device last month, 0:19:17.080 --> 0:19:21.040 saying Apple failed to comply with its domestic content requirements. 0:19:21.160 --> 0:19:23.879 Get stuck into all of these Apple related stories. I 0:19:23.920 --> 0:19:25.200 want to known Mark German with. 0:19:25.200 --> 0:19:27.640 Us, and Mark just talk to us a little bit 0:19:27.680 --> 0:19:30.919 more about what's happening with Indonesia because this is a 0:19:30.920 --> 0:19:34.040 big one eighty and they played hardball. 0:19:33.680 --> 0:19:34.080 In a one. 0:19:35.480 --> 0:19:36.600 Yeah, that's exactly right. 0:19:36.640 --> 0:19:39.000 So Apple and Indonesia have been going back and forth 0:19:39.080 --> 0:19:43.040 for weeks now since the launch of the iPhone sixteen. Right, Obviously, 0:19:43.080 --> 0:19:45.119 Apple wants to get the device in as many countries 0:19:45.160 --> 0:19:48.399 as possible. Indonesia is important to Apple because that's a 0:19:48.400 --> 0:19:51.760 potential growth market for them. Right, they are making a 0:19:51.760 --> 0:19:54.760