WEBVTT - Tesla Sales Drop, TikTok Bid 0:00:02.720 --> 0:00:10.560 Bloomberg Audio, Studios, podcasts, radio news. You're listening to the 0:00:10.560 --> 0:00:14.560 Bloomberg Intelligence podcast. Catch us live weekdays at ten am 0:00:14.600 --> 0:00:17.840 Eastern on Apple Coarclay, and Android Auto with the Bloomberg 0:00:17.880 --> 0:00:21.040 Business App. Listen on demand wherever you get your podcasts, 0:00:21.320 --> 0:00:23.240 or watch us live on YouTube. 0:00:23.920 --> 0:00:25.280 All right, let's get to one stock in the move. 0:00:25.320 --> 0:00:28.720 A's Tesla shares down by about two percent. They're off 0:00:28.720 --> 0:00:31.800 the lows of the session. It reported first quarter deliveries 0:00:31.800 --> 0:00:34.600 that went below analyst estimates, touching the lowest level since 0:00:34.600 --> 0:00:37.640 the second quarter of twenty twenty two. I want to 0:00:37.640 --> 0:00:41.159 talk to Steve Mann, Bloomberg Intelligence Global Audios and Research 0:00:41.240 --> 0:00:45.000 analyst joining us. Hey, Steve, what would behind the drop 0:00:45.000 --> 0:00:46.920 in sales? That may seem like an obvious question, but 0:00:46.920 --> 0:00:48.599 it feels like there are lots of layers here to this. 0:00:49.680 --> 0:00:53.800 Yeah, Admittedly, the thirty percent decline was a little bit 0:00:53.800 --> 0:00:56.280 more than what we were expecting. We were expecting around 0:00:56.320 --> 0:00:59.040 three hundred and fifty thousand, came in at around three 0:00:59.120 --> 0:01:02.240 hundred and thirty six. But you know, it's if you 0:01:02.280 --> 0:01:07.080 look below the headline, it's actually operating as we expected. 0:01:07.160 --> 0:01:11.720 It's unfolding as we expected. China sales. Retail sales is 0:01:11.760 --> 0:01:17.000 actually up despite production down year on year. US is 0:01:17.080 --> 0:01:22.039 kind of flatish. Really, the dent to the quarterly sales 0:01:22.200 --> 0:01:24.720 was in Europe. It seems like March. March is a 0:01:24.760 --> 0:01:29.640 little bit worse than February and January. But our thesis 0:01:29.680 --> 0:01:33.000 has not changed. You know, we still think the inflection 0:01:33.120 --> 0:01:37.080 point is in second quarter. We believe China sales improvement 0:01:37.120 --> 0:01:40.440 will extend into the second quarter, and then, you know, 0:01:40.480 --> 0:01:42.360 the Model Y has already launched in the US and 0:01:42.400 --> 0:01:45.399 we expect, you know, some improvement in sales in the 0:01:45.480 --> 0:01:46.800 US as well in the second quarter. 0:01:47.280 --> 0:01:50.080 Talk to us about the model. Why I know Matt 0:01:50.080 --> 0:01:51.720 Miller has yet to take me in a model. Why 0:01:52.360 --> 0:01:53.920 so I don't know anything about it. Tell me about 0:01:53.920 --> 0:01:56.080 the model. Why is it a game changer? Is it 0:01:56.240 --> 0:01:58.560 just a slight move. Talk about this new model what 0:01:58.600 --> 0:01:59.120 it might mean. 0:01:59.760 --> 0:02:03.520 Yeah, Yeah, there's some cosmetic changes in the front end 0:02:03.640 --> 0:02:07.160 and the rear end. The lighting in the rear end 0:02:07.720 --> 0:02:10.760 is is pretty cool if you haven't seen it yet. 0:02:10.800 --> 0:02:13.120 But I think the most biggest, some of the biggest 0:02:13.160 --> 0:02:17.360 changes are inside the user experience. There's a monitor at 0:02:17.360 --> 0:02:20.720 the back, there's a nice little cooler up in the 0:02:21.160 --> 0:02:25.480 front end. So you know, there's people who have held 0:02:25.520 --> 0:02:28.799 off buying the model, why anticipation of the new one. 0:02:29.560 --> 0:02:32.280 But how much of this is reputational damage? It might 0:02:32.320 --> 0:02:34.680 be too early to say, right because it's still through March. 0:02:34.760 --> 0:02:37.360 But I hear you that on principle, you're bullish on 0:02:37.440 --> 0:02:40.720 the car and sales in essence. But I mean, we 0:02:40.760 --> 0:02:43.080 can't ignore the reputational damage. I mean, I know that 0:02:43.120 --> 0:02:45.000 I'm in Brooklyn, but I see like get rid of 0:02:45.000 --> 0:02:49.160 your Tesla signs everywhere at this point, that's right, I don't. 0:02:48.960 --> 0:02:51.400 I don't think we can ignore that what we're seeing 0:02:52.120 --> 0:02:54.520 in the media and what happening to test the cars 0:02:54.560 --> 0:02:58.920 and in showrooms, it is having an impact. It definitely 0:02:59.000 --> 0:03:01.840 is having some impact in Europe. But at the end 0:03:01.880 --> 0:03:04.000 of the day, you know, we feel that a lot 0:03:04.000 --> 0:03:06.919 of it is being priced in. The stock has come 0:03:06.960 --> 0:03:11.720 off from its highs since the election. You know, the 0:03:11.800 --> 0:03:15.520 P four pe ratio is around eighty five times twenty 0:03:15.600 --> 0:03:20.760 twenty five earnings. That's just about ten percent above where 0:03:20.760 --> 0:03:25.040 it traded before the presidential election. So I think, you know, 0:03:25.080 --> 0:03:28.600 I think the stock has pretty much factored that in, 0:03:29.400 --> 0:03:32.840 and you know, we're looking ahead and we think business 0:03:32.880 --> 0:03:36.240 fundamental should improve in the second quarter. You deliver, it 0:03:36.240 --> 0:03:37.640 should improve in the second quarter. 0:03:38.080 --> 0:03:41.840 Does the company does the stock need Elon Musk to 0:03:41.880 --> 0:03:42.840 come back to the company? 0:03:44.480 --> 0:03:49.640 I personally, I think so because he's he's an industrialist. 0:03:50.400 --> 0:03:53.440 He's an avid cost cutter, and that's really what you 0:03:53.640 --> 0:03:57.160 really need in the auto industry given the price competition 0:03:57.280 --> 0:04:01.960 that we're seeing around the world. And uh uh you know, 0:04:02.040 --> 0:04:05.400 hopefully later in the year, when you know, when he 0:04:05.440 --> 0:04:09.760 gets thosee up and running in a steady pace and 0:04:10.040 --> 0:04:12.400 uh you know, he can maybe step off and refocus 0:04:12.920 --> 0:04:14.120 on on his businesses. 0:04:14.640 --> 0:04:17.320 What does Tesla need to refocus on? Like what company 0:04:17.320 --> 0:04:18.480 does Tesla now need to be? 0:04:20.120 --> 0:04:22.919 Well, they need to continue to be an innovator. I 0:04:22.960 --> 0:04:25.719 think there's a lot of debate out there why Tesla 0:04:25.839 --> 0:04:31.120 deserves a higher valuation than like GM and Ford. Look, 0:04:32.040 --> 0:04:34.719 you know they have they they're doing something that you know, 0:04:35.040 --> 0:04:38.720 we I couldn't imagine anyone can do in the auto industry, 0:04:38.760 --> 0:04:41.960 which is to start a new automaker in this day 0:04:42.000 --> 0:04:45.120 and age, it's high barriers of entry, and they're doing 0:04:45.200 --> 0:04:50.120 it in a way that it's profitable. Right. Uh, you know, 0:04:50.600 --> 0:04:52.960 there's there's a lot of debate, but you know they are, 0:04:53.720 --> 0:04:59.159 they are booking profits on EV sales and uh, you 0:04:59.200 --> 0:05:02.080 know it's it's hard to find, you know, an automaker 0:05:02.160 --> 0:05:05.240 that can still do this and do it do it 0:05:05.240 --> 0:05:06.440 in a consistent manner. 0:05:07.400 --> 0:05:09.920 Steve, I just bought a vehicle. I mean, I'll have 0:05:10.000 --> 0:05:13.800 you know. It is a hybrid, so I'm getting there slowly. 0:05:14.360 --> 0:05:17.160 He's not actually driving it, but it's a fair point. 0:05:17.279 --> 0:05:21.680 So Steve is b y D and the Chinese automakers. 0:05:21.760 --> 0:05:24.240 Are they going to take over the e V world? 0:05:25.880 --> 0:05:28.000 You know, it looks like it. 0:05:29.160 --> 0:05:33.719 Time will tell. They're very aggressive. You know, they've you know, 0:05:33.760 --> 0:05:37.400 they've cornered the market in China, right, they've basically, through 0:05:37.440 --> 0:05:39.280 price they have pushed out a lot of the foreign 0:05:39.320 --> 0:05:41.360 automakers out of China. 0:05:42.040 --> 0:05:42.160 Uh. 0:05:42.279 --> 0:05:45.279 And then you know they're actually branching out into the 0:05:45.320 --> 0:05:47.760 rest of the world. Not not in the US. They're 0:05:47.760 --> 0:05:52.760 making headways in Europe despite the tariffs there. But they're 0:05:52.920 --> 0:05:57.120 really aggressive in emerging markets, which is competing a lot 0:05:57.160 --> 0:06:01.359 with the likes of Toyota and the Koreated South Korean Handay. 0:06:01.920 --> 0:06:05.960 So you know they're if you can think of you know, 0:06:06.000 --> 0:06:09.440 they're kind of encircling the US at the moment, North 0:06:09.480 --> 0:06:13.000 America at the moment. So, uh, they don't have to 0:06:13.000 --> 0:06:16.039 be in the US. But if you know they're in there, 0:06:16.040 --> 0:06:18.320 if they're strong in China and there's strong in other 0:06:18.360 --> 0:06:22.760 emerging markets, uh, you know they will they will eventually dominate. 0:06:23.200 --> 0:06:27.359 Okay, but thirty seconds or so, lepstive. But speaking of 0:06:27.480 --> 0:06:29.599 when Paul bought the car, it was a Honda and 0:06:29.680 --> 0:06:32.760 it was you made in the US. So, like, why 0:06:32.800 --> 0:06:36.200 have foreign automakers been able to move manufacturing here in 0:06:36.200 --> 0:06:38.360 a way that US automakers haven't. 0:06:40.200 --> 0:06:42.840 Yeah, you know, I think I think a lot of 0:06:42.920 --> 0:06:48.000 automakers over time has been very focused on driving profitability. 0:06:48.040 --> 0:06:50.279 And there's nothing wrong with that, right, There's nothing wrong 0:06:50.320 --> 0:06:52.600 with that, and that's that's the only reason why we 0:06:53.080 --> 0:06:56.720 people go into business is to make money. But I think, uh, 0:06:57.080 --> 0:07:00.240 you know that that you know, there has to be 0:07:00.240 --> 0:07:04.000 a balance. I think, and you know, driving costs is great, 0:07:04.560 --> 0:07:08.039 but can we drive costs with innovation? And I think 0:07:08.080 --> 0:07:11.720 that's what Trump is trying to do based on his rhetoric, 0:07:11.960 --> 0:07:15.280 is to bring back manufacturing. So like, how can The 0:07:15.400 --> 0:07:19.040 question is how can automakers actually build a low cost 0:07:19.080 --> 0:07:21.800 car in the US through innovation. 0:07:24.680 --> 0:07:27.600 It's Steve Man, a Bloomberg Intelligence at Global Autos and 0:07:27.720 --> 0:07:31.240 Industry at the Analysts. Thank you very much for joining us. 0:07:33.040 --> 0:07:36.720 You're listening to the Bloomberg Intelligence podcast. Catch us live 0:07:36.800 --> 0:07:40.200 weekdays at ten am Eastern on Applecarplay and Android Auto 0:07:40.280 --> 0:07:43.360 with the Bloomberg Business App. Listen on demand wherever you 0:07:43.400 --> 0:07:46.560 get your podcasts, or watch us live on YouTube. 0:07:47.120 --> 0:07:49.600 That Musk news is really interesting. It's great for the 0:07:49.640 --> 0:07:52.000 stock stocks. Up four percent is Genosis reporting, So I'm 0:07:52.000 --> 0:07:54.560 sure the investors there are happy. Let's get right down 0:07:54.560 --> 0:07:58.160 to DC and get it from the a source, our source. 0:07:58.280 --> 0:08:02.040 Then in DC. Nathan Dean, senior policy analysts for Bloomberg Intelligence. 0:08:02.480 --> 0:08:05.000 Nathan in the Beltway, what was the feeler and what 0:08:05.160 --> 0:08:09.160 is the feeling about Elon Musk? His role, his proximity 0:08:09.200 --> 0:08:11.720 to the president is so so close, and it's been 0:08:11.720 --> 0:08:16.600 that way since the inauguration here, But is anybody surprised 0:08:16.600 --> 0:08:18.200 that he may be leaving maybe leading soon? 0:08:19.200 --> 0:08:21.360 So I don't think I was surprised. I think this 0:08:21.520 --> 0:08:24.040 makes sense. And obviously if you're in Tesla investor, you're 0:08:24.040 --> 0:08:26.040 going to like the idea that Elon Musk returns to 0:08:26.120 --> 0:08:28.040 the company. But if you think about it, you know, 0:08:28.080 --> 0:08:30.840 the Doge Committee, the Doge Group, if you will, they've 0:08:30.840 --> 0:08:33.560 been expanding. Bloomberg News just reported a few minutes ago 0:08:33.600 --> 0:08:37.360 that Kelshi's chief regulatory officer is going to Doge. What 0:08:37.400 --> 0:08:39.840 Elon Musk essentially has done is he's created a group 0:08:39.840 --> 0:08:42.520 and they're going agency by agency, but they can only 0:08:42.559 --> 0:08:44.960 cut so much. You know, if they cut too much, 0:08:45.040 --> 0:08:47.400 then eventually it's going to be a political blowback. And 0:08:47.520 --> 0:08:49.680 Elon Musk doesn't have the power to go after the 0:08:49.679 --> 0:08:52.440 mandatory spending, which is where the big ticket items in 0:08:52.520 --> 0:08:55.280 terms of reducing the deficit is. So I think this 0:08:55.400 --> 0:08:58.520 makes sense. He's going to return to the Tesla. Assuming 0:08:58.520 --> 0:09:01.240 Political is reporting is correct, he'll return to Tesla, but 0:09:01.320 --> 0:09:04.080 nothing prevents him from coming back. Nothing prevents them from 0:09:04.120 --> 0:09:06.000 going into the White House. And I think if you're 0:09:06.000 --> 0:09:08.840 a Republican on Capitol Hill, you'll love the idea that 0:09:08.920 --> 0:09:10.760 maybe you're not going to have the White House calling 0:09:10.800 --> 0:09:13.840 for deep cuts to Social Security, the mandatory spending. If 0:09:13.880 --> 0:09:15.880 you will, they'll be left to Congress. So I think 0:09:15.920 --> 0:09:17.400 they may be pleased with this as well. 0:09:17.600 --> 0:09:19.320 So this is not the end of DOGE. If this 0:09:19.400 --> 0:09:21.960 is indeed true, this is just sort of an evolution 0:09:22.240 --> 0:09:24.560 of DOGE, So we can still expect that to come 0:09:24.600 --> 0:09:27.320 and bring hammers to everyone's payrolier. 0:09:27.440 --> 0:09:29.920 Absolutely well, at least in terms of your first question 0:09:29.960 --> 0:09:32.360 in terms of this is not the end of DOGE. 0:09:32.360 --> 0:09:35.040 Dog is going to continue. But what Elon must did 0:09:35.120 --> 0:09:37.760 is essentially created a group of advisors and individuals that 0:09:37.840 --> 0:09:40.679 are going in agency by agency and they're looking at 0:09:40.720 --> 0:09:45.840 identifying areas to cut. But for Elon's mangal of deficit reduction, 0:09:46.160 --> 0:09:47.920 he's not going to be able to do that with DOGE. 0:09:47.960 --> 0:09:49.760 They just do not have the power to do that. 0:09:50.000 --> 0:09:52.600 It requires an Act of Congress. So you are going 0:09:52.600 --> 0:09:55.160 to see DOGE continue probably for the next year, if 0:09:55.200 --> 0:09:57.880 not a little bit longer, until they really get to 0:09:57.880 --> 0:09:59.960 the point where they are streamlined and they feel that 0:10:00.000 --> 0:10:03.360 they've adequately right sized those agencies. But for the big 0:10:03.360 --> 0:10:05.520 ticket items, we're going to see that in the upcoming 0:10:05.559 --> 0:10:09.280 tax debate in terms of things like MEDICAIDS, snap benefits. 0:10:09.920 --> 0:10:12.280 You know obviously that was a mandatory, but social Security, 0:10:12.480 --> 0:10:15.840 the really key things that are really important to the deficit. 0:10:16.240 --> 0:10:18.720 DOJ and Elon Musk just don't have the ability to control. 0:10:18.960 --> 0:10:21.000 He's going to need Congress to do that. And I 0:10:21.000 --> 0:10:23.240 think Congress is going to be happy. They're now going 0:10:23.240 --> 0:10:25.040 to be in the back in the driver's seat, assuming 0:10:25.040 --> 0:10:26.280 that Elon Musk does leave. 0:10:26.760 --> 0:10:31.040 And Nathan, I wonder if the last night's race in Wisconsin, 0:10:31.080 --> 0:10:35.680 with the addictional race where Elon Musk candidate did not win, 0:10:36.720 --> 0:10:38.080 do you think that had anything to do with his 0:10:38.160 --> 0:10:38.800 decision making. 0:10:39.600 --> 0:10:41.520 I don't think so. But I think what last night 0:10:41.559 --> 0:10:44.960 didd was the indication of what Republicans fear may happen 0:10:45.040 --> 0:10:47.000 eighteen months from now. I mean, if you look at 0:10:47.000 --> 0:10:49.440 midterm elections, they always swing back the other way. I 0:10:49.440 --> 0:10:51.800 mean the joke is, think of US politics as like 0:10:51.840 --> 0:10:53.960 a car out of control going down the street. It 0:10:54.040 --> 0:10:56.240 hits guardrails left and right, left and right, it never 0:10:56.280 --> 0:10:59.120 goes straight. And so you know, the tendency here is 0:10:59.120 --> 0:11:01.240 is that the House of rep is going to be 0:11:01.280 --> 0:11:04.160 in play for Democrats. And I think yesterday just told 0:11:04.200 --> 0:11:06.600 a lot of those Republicans on Capitol Hill that a 0:11:06.679 --> 0:11:09.680 year from now this may be something that hurts them politically. 0:11:09.760 --> 0:11:11.600 And so I don't think anybody's going to vote off 0:11:11.600 --> 0:11:14.680 of what happens right now eighteen months from now. But 0:11:14.760 --> 0:11:17.600 I do think that this decision for Elon Musk to 0:11:17.600 --> 0:11:20.440 maybe step away from Washington and go back to Texas 0:11:20.480 --> 0:11:22.679 and Florida and so forth like that will make a 0:11:22.720 --> 0:11:24.880 little bit of the Republicans and capitall breathe a little 0:11:24.880 --> 0:11:27.080 bit easier, just because they can get a little bit 0:11:27.160 --> 0:11:28.120 more control of the narrative. 0:11:28.240 --> 0:11:30.120 You know what this did do We didn't talk about 0:11:30.160 --> 0:11:32.920 tariffs for four minutes. Yes, I'm just saying that newsful 0:11:33.080 --> 0:11:36.920 definitely just changed. Nathan. Okay, So four o'clock today, I'm 0:11:36.920 --> 0:11:39.400 going to be sitting on set on TV, gonna have 0:11:39.480 --> 0:11:41.880 my terminal NI heads for all the pros out there. 0:11:42.400 --> 0:11:44.960 What are the headlines that you the literal headline that 0:11:45.000 --> 0:11:47.040 crosses that you're going to be most interested in. 0:11:48.080 --> 0:11:50.560 So obviously the biggest question is is this going to 0:11:50.559 --> 0:11:52.760 be a country tax or a tariff? Or is this 0:11:52.800 --> 0:11:56.040 going to be a tariff tariff? Sorry, tiered tariff. But 0:11:56.120 --> 0:11:57.760 you know, one of the big questions we're getting from 0:11:57.800 --> 0:12:01.800 clients this morning is they're focusing on Secretary I'm sorry, 0:12:01.800 --> 0:12:04.800 Treasury Secretary of Scott Beston is saying in terms these 0:12:04.840 --> 0:12:07.319 are a cap is essentially floating the idea that these 0:12:07.360 --> 0:12:10.760 are a cap, with the idea here that potentially President 0:12:10.800 --> 0:12:14.120 Trump will be willing to negotiate going forward and bringing 0:12:14.120 --> 0:12:16.920 this down from like a cap down to a reciprocal tariff. 0:12:17.200 --> 0:12:19.800 And so the question for me is, in this statement 0:12:19.840 --> 0:12:21.920 tonight at the White House or sorry, at the Rose Garden, 0:12:22.360 --> 0:12:24.760 is President Trump going to give any indication that he'll 0:12:24.800 --> 0:12:27.439 be willing to pick up a phone tomorrow. Because if 0:12:27.480 --> 0:12:29.560 that's the case, you know, he can come out and 0:12:29.559 --> 0:12:33.360 say twenty fifteen, twenty percent universal tariff, whatever it may be, 0:12:33.880 --> 0:12:36.200 but tomorrow it may be different. And so you're not 0:12:36.240 --> 0:12:38.960 going to get that clarity of this is what the 0:12:38.400 --> 0:12:41.400 tariff policy for the United States will be. I don't 0:12:41.400 --> 0:12:43.400 think the markets will like that, just because I don't 0:12:43.400 --> 0:12:44.439 think that clarity is coming. 0:12:45.360 --> 0:12:49.600 So do you expect any pushback feedback once we do 0:12:49.800 --> 0:12:54.319 know what the policy is from either obviously the Democrats 0:12:54.360 --> 0:12:56.320 or maybe even some in the Republican Party. 0:12:56.960 --> 0:12:59.160 Well, absolutely, I mean I think we're going to see, 0:12:59.200 --> 0:13:02.520 you know, obviously the sometime today pick up their resolution 0:13:02.679 --> 0:13:05.000 to try and you know, overturn these tariffs that were 0:13:05.120 --> 0:13:07.599 up with Canada, and you know, my vote count, I 0:13:07.640 --> 0:13:09.719 at least I had. You know, the Democrats need four 0:13:09.800 --> 0:13:12.440 Republican senators to go along with them, and I think. 0:13:12.320 --> 0:13:12.880 They have it. 0:13:13.240 --> 0:13:15.000 So you are going to begin to see a public 0:13:15.040 --> 0:13:18.560 rebuke of some of these tariffs. I would just caution though, 0:13:18.600 --> 0:13:20.520 and say that, you know, tariffs are the power of 0:13:20.520 --> 0:13:23.680 the presidency. Congress delegated its authority a long time ago, 0:13:23.920 --> 0:13:26.360 so there's only so much Congress can do to actually 0:13:26.360 --> 0:13:28.920 advise the presidents say maybe you should scale this back. 0:13:29.160 --> 0:13:32.040 So it's ultimately President Trump's decision. And I think that 0:13:32.320 --> 0:13:34.800 for him to be able to walk back this tariff, 0:13:35.040 --> 0:13:37.120 and this is just my own personal belief, you're going 0:13:37.160 --> 0:13:39.520 to you're going to need to see consumer confidence or 0:13:39.559 --> 0:13:42.640 sticker shock amongst things that you know, Americans just buying 0:13:42.679 --> 0:13:45.280 a daily basis for him to actually walk back a 0:13:45.280 --> 0:13:46.240 lot of their tarff threat. 0:13:46.880 --> 0:13:48.720 And of course, though the goal is to shipt the 0:13:48.760 --> 0:13:53.319 economy though away from physical spending to private led investments, 0:13:53.920 --> 0:13:54.880 is that a possible thing. 0:13:56.200 --> 0:13:57.080 Not in the short term. 0:13:57.080 --> 0:13:59.320 I mean, this has been the White House plan all along, 0:13:59.520 --> 0:14:01.920 is that you're going to have short term pain for 0:14:02.040 --> 0:14:04.400 long term gain. But you know, some of these pains 0:14:04.440 --> 0:14:06.560 are going to be very, very, very permanent. I mean, 0:14:06.600 --> 0:14:09.439 if you think of just the farmer argument in particular 0:14:09.800 --> 0:14:12.120 that you know, if the United States does move forward 0:14:12.160 --> 0:14:16.000 and use the USDA to implement subsidies for farmers, farmers 0:14:16.040 --> 0:14:18.320 aren't going to like that because essentially what it means 0:14:18.480 --> 0:14:20.360 is that you're going to be thrown out of the 0:14:20.400 --> 0:14:23.040 supply chain and in the future, maybe instead of buying 0:14:23.040 --> 0:14:24.360 goods from the United States, they're going to buy it 0:14:24.360 --> 0:14:26.440 from Brazil. That's not something that you're going to be 0:14:26.480 --> 0:14:29.280 able to easily reverse. So yes, you are going to 0:14:29.320 --> 0:14:31.320 get this shift. And we've heard from clients saying, look, 0:14:31.360 --> 0:14:33.960 I want to potentially buy a factory in the United States. 0:14:34.120 --> 0:14:36.160 I just can't do it in twenty twenty five, probably 0:14:36.160 --> 0:14:38.720 can't even do it by twenty twenty seven. So you know, 0:14:38.800 --> 0:14:41.320 again it's really how long how long can the White 0:14:41.320 --> 0:14:44.600 House really keep with this strategy to try and transform 0:14:44.600 --> 0:14:45.240 that economy. 0:14:45.720 --> 0:14:47.680 All right, Nathan, thank you so much. We appreciate it, 0:14:47.720 --> 0:14:49.840 and you're going to have a long afternoon and into 0:14:49.840 --> 0:14:52.920 the evening analyzing what we will hear from the President 0:14:53.000 --> 0:14:56.600 this scepter and Nathan Deane, Senior policy analyst Bloomberg Intelligence. 0:14:56.600 --> 0:14:58.840 He's based down there and wash it in DC. He 0:14:58.920 --> 0:15:02.840 does a wonderful job explaining all the mechanizations of what 0:15:03.000 --> 0:15:06.520 happens down there in Washington and Congress and Capitol Hill 0:15:07.120 --> 0:15:09.960 and in the White House as well. 0:15:10.160 --> 0:15:13.840 You're listening to the Bloomberg Intelligence podcast. Catch us live 0:15:13.920 --> 0:15:17.280 weekdays at ten am Eastern on Applecarcklay and Android Auto 0:15:17.440 --> 0:15:20.480 with the Bloomberg Business App. Listen on demand wherever you 0:15:20.520 --> 0:15:24.640 get your podcasts, or watch us live on YouTube in DC. 0:15:24.800 --> 0:15:26.840 It's not just about musk, It's not just about tariffs. 0:15:26.840 --> 0:15:31.080 It's also about TikTok. Potentially. President Trump is weighing plans 0:15:31.080 --> 0:15:34.320 for TikTok sale today at a meeting. We want to 0:15:34.320 --> 0:15:36.160 get more on this. And Matt you St and Hell 0:15:36.240 --> 0:15:39.640 media litigation analyst for Bloomberg Intelligence, he joins us now 0:15:39.640 --> 0:15:42.360 from DC. All right, remind us of where we are 0:15:42.400 --> 0:15:44.480 in the law and what Congress did and where we're 0:15:44.520 --> 0:15:44.880 at here. 0:15:46.000 --> 0:15:49.560 Yeah, So we are at the point where Congress adopted 0:15:49.600 --> 0:15:53.720 this law last year that effectively bans TikTok in the 0:15:53.800 --> 0:15:58.680 United States. As of January nineteenth. The Supreme Court upheld 0:15:58.720 --> 0:16:03.000 that law after TikTok Talk brought a constitutional challenge, and 0:16:03.040 --> 0:16:07.200 then President Trump adopted an executive order just before the 0:16:07.280 --> 0:16:11.760 law was going to take effect in mid January to 0:16:11.880 --> 0:16:16.600 say that, look, companies that are at risk under this law, 0:16:17.240 --> 0:16:19.400 don't worry about it. Right now, we're not going to 0:16:19.520 --> 0:16:24.360 enforce that law. So app stores like Google and Apple 0:16:24.800 --> 0:16:30.080 and Oracle, companies that host TikTok, potentially faced billions of 0:16:30.120 --> 0:16:35.200 dollars of liability under the law. Trump's Attorney general sent 0:16:35.240 --> 0:16:37.920 a letter saying, don't worry about it. We don't think 0:16:37.960 --> 0:16:40.520 you're in violation of the law, so you can continue 0:16:40.520 --> 0:16:44.600 to host TikTok. That executive order from President Trump ran 0:16:44.680 --> 0:16:48.400 for seventy five days. That takes you to Saturday, April fifth. 0:16:48.640 --> 0:16:51.040 So we're at the point where there's likely to be 0:16:51.320 --> 0:16:54.240 some action. And as you said, there's a meeting in 0:16:54.280 --> 0:16:55.160 the White House today. 0:16:55.560 --> 0:16:57.760 It's a good time for this discussion. Matthew had read 0:16:57.760 --> 0:17:00.960 headline crossing the Bloomberg terminals we speak, Amazon puts in 0:17:01.000 --> 0:17:05.760 a last minute bid to acquire all of TikTok. What 0:17:05.800 --> 0:17:07.480 do you make of that? 0:17:07.480 --> 0:17:10.760 That's that's that's fascinating. I mean to me, that underscores 0:17:10.800 --> 0:17:15.040 how far we are away from a resolution here and 0:17:15.119 --> 0:17:18.359 you're talking about, you know, you know, some indication that 0:17:18.400 --> 0:17:21.400 they that a deal could be in place by by Saturday. 0:17:21.600 --> 0:17:24.280 I don't think so. There there are so many moving 0:17:24.400 --> 0:17:29.480 pieces here and new bids coming in that the idea 0:17:29.640 --> 0:17:32.920 that all of this is going to be resolved in 0:17:33.440 --> 0:17:37.760 three days seems pretty fantastic. So I think what you're 0:17:37.960 --> 0:17:41.080 likely to see is sort of some indication of movement 0:17:41.400 --> 0:17:44.760 towards a deal and President Trump again kicking the can 0:17:44.840 --> 0:17:47.760 down the road. And the only question is is anyone 0:17:47.800 --> 0:17:49.840 going to stand up to that. There was a lot 0:17:49.880 --> 0:17:54.560 of political courage to to, you know, advocate for a 0:17:54.600 --> 0:17:57.040 ban of TikTok last year. There were some votes in 0:17:57.080 --> 0:17:59.600 Congress that were fifty to zero for it. But now 0:17:59.640 --> 0:18:03.160 President Trump has a warm spot in his heart for TikTok, 0:18:03.200 --> 0:18:06.359 as he says, and suddenly some of that courage is 0:18:06.400 --> 0:18:09.400 falling away. So that's going to be the interesting dynamic 0:18:09.520 --> 0:18:14.040 is how much lawmakers or maybe TikTok's competitors stand up 0:18:14.080 --> 0:18:16.280 and say, hey, we have a law on the books 0:18:16.280 --> 0:18:18.679 here that that that bands TikTok. Are we going to 0:18:18.800 --> 0:18:19.480 enforce it or not? 0:18:20.359 --> 0:18:23.600 So to that point, I guess I wonder what part 0:18:23.640 --> 0:18:26.360 of TikTok is still left to be bought in that 0:18:26.800 --> 0:18:29.200 is it just going to be the US stuff, which 0:18:29.280 --> 0:18:31.359 may not be as valuable, or is it going to 0:18:31.400 --> 0:18:34.639 also be the technology that kind of sits in China. 0:18:34.720 --> 0:18:36.840 And if that's the case, how do we get. 0:18:36.600 --> 0:18:40.360 That That's that's sort of the million dollar question here, 0:18:40.400 --> 0:18:43.080 because there was a lot of pushback in Congress for 0:18:43.480 --> 0:18:47.119 the idea that a company tied to China would still 0:18:47.160 --> 0:18:51.119 have control over the algorithm, and and a lot of 0:18:51.160 --> 0:18:54.080 the solutions you're seeing floated around look a lot like 0:18:54.280 --> 0:18:58.800 what TikTok was pitching as Project Texas last year, where 0:18:59.280 --> 0:19:03.000 the US opperations what would work here maybe under Oracle 0:19:03.119 --> 0:19:06.919 or someone else, but the algorithm would still ultimately be 0:19:07.080 --> 0:19:11.480 controlled by by byte Dance. And the question is is 0:19:11.560 --> 0:19:14.080 that the sort of solution that we're talking about here, 0:19:14.119 --> 0:19:17.920 because ultimately China and byte Dance need to agree to this, 0:19:18.280 --> 0:19:21.119 and and with with Trump kicking the can down the 0:19:21.200 --> 0:19:25.359 road on this van, I'm not sure they have a 0:19:25.359 --> 0:19:27.159 lot of concern. I don't know that the US has 0:19:27.200 --> 0:19:31.680 a lot of leverage to force them to sell the algorithm, 0:19:31.720 --> 0:19:34.320 So it seems very likely that we're looking at some 0:19:34.359 --> 0:19:39.240 sort of solution that that keeps that algorithm tied to China, 0:19:39.359 --> 0:19:41.680 tied to byte Dance, And the question is is Congress 0:19:41.800 --> 0:19:44.080 going to be okay with that now in a way 0:19:44.119 --> 0:19:45.240 they weren't last year? 0:19:46.320 --> 0:19:48.680 I mean, silly question, but there's no indication that byte 0:19:48.760 --> 0:19:50.960 Dance wants to sell here. So I mean an Amazon 0:19:51.000 --> 0:19:53.280 bid is impressive, but I don't think I've got a 0:19:53.320 --> 0:19:54.040 seller there, do I. 0:19:54.960 --> 0:19:58.560 That's exactly that's been the problem, you know through this 0:19:58.640 --> 0:20:03.400 whole process, is is bike Dance really willing to sell 0:20:03.520 --> 0:20:08.359 and especially the algorithm component here with with China needing 0:20:08.400 --> 0:20:12.400 to to bless that. So yeah, a lot of offers, 0:20:12.480 --> 0:20:15.119 a lot of talk, but but I think we're far 0:20:15.160 --> 0:20:18.120 from from any sort of final resolution here. 0:20:18.600 --> 0:20:20.720 So to that point, this goes back to the earlier 0:20:20.760 --> 0:20:22.679 headline that Paul just broke that Amazon's putting in that 0:20:22.720 --> 0:20:25.040 last minute bid to acquire all of TikTok this according 0:20:25.040 --> 0:20:26.879 to the New York Times, who else quickly is on 0:20:26.920 --> 0:20:28.280 the docket to potentially buy? 0:20:29.760 --> 0:20:32.399 Yeah, so I mean you keep seeing Oracle mentioned as 0:20:32.560 --> 0:20:35.680 a potential bidder. You saw Frank McCourt was on Bloomberg 0:20:35.720 --> 0:20:40.080