WEBVTT - Tesla Shares Surge After Blowout Quarter 0:00:02.440 --> 0:00:09.119 Bloomberg Audio Studios, Podcasts, radio news. You're listening to the 0:00:09.160 --> 0:00:13.280 Bloomberg Intelligence Podcast. Catch us live weekdays at ten am 0:00:13.360 --> 0:00:16.360 Eastern on Apple card playing Android Auto with the Bloomberg 0:00:16.400 --> 0:00:19.720 Business App. Listen on demand wherever you get your podcasts, 0:00:19.960 --> 0:00:23.480 or watch us live on YouTube. 0:00:23.360 --> 0:00:26.440 Or Melinda sitting in for Alex Steel Paul Swin. You're 0:00:26.480 --> 0:00:28.400 live here in on OL Bloomberg Interactive Broker Studio or 0:00:28.440 --> 0:00:30.360 streaming live on YouTube as well, So head over to 0:00:30.400 --> 0:00:33.440 YouTube dot com search Bloomberg Podcast. That's where you'll find us. 0:00:33.479 --> 0:00:36.880 Earlier today on Surveance, we had Dan Ives from What 0:00:37.040 --> 0:00:38.960 Bush Securities on doing a little victory lap on his 0:00:39.600 --> 0:00:42.720 bullish tesla call. The stocks up seventeen percent today, the 0:00:42.720 --> 0:00:44.720 most since March of twenty twenty one, on the back 0:00:44.760 --> 0:00:47.280 of some pretty darn good earnings numbers. Let's break it 0:00:47.320 --> 0:00:50.280 down to Craig Trudell. He's a Global autos editor for 0:00:50.320 --> 0:00:54.920 Bloomberg News. Joins us from Zoom from London on Zoom 0:00:54.920 --> 0:00:57.840 on that technology there. Hey, Craig, what stood out to you? 0:00:57.920 --> 0:01:00.440 Why do you think the stock is up seventeen percent today? 0:01:00.960 --> 0:01:02.360 What did you see it out of earnings release? 0:01:03.840 --> 0:01:07.200 I mean it was really It's really quite a combination, 0:01:07.360 --> 0:01:13.000 because oftentimes it feels like it's not necessarily the case 0:01:13.080 --> 0:01:16.200 that you can count on both both earnings and the 0:01:16.280 --> 0:01:21.440 vision to be positive. In this case, they both both 0:01:21.480 --> 0:01:24.960 were working in Musk's favor. I think the earnings were 0:01:25.040 --> 0:01:29.040 much better than expected. I do think that those expectations 0:01:29.120 --> 0:01:32.200 came down quite a bit over the last year year 0:01:32.200 --> 0:01:36.120 and a half, but they sort of they did exceed 0:01:36.560 --> 0:01:43.440 expectations by pretty significant measures. And the profit margins in particular, 0:01:43.560 --> 0:01:46.319 or something that everybody keeps a very close eye on 0:01:46.360 --> 0:01:50.200 their automotive profit margins when you back out the credits 0:01:50.200 --> 0:01:54.560 that they sell to other automakers for regulatory purposes, those 0:01:54.960 --> 0:01:57.520 in particular, I feel like, are you know, just quarter 0:01:57.600 --> 0:02:00.960 in and quarter out what everybody looks at? That was 0:02:01.000 --> 0:02:04.200 a big beat. And then I think Musk was as 0:02:04.280 --> 0:02:08.519 self assured as I've ever heard. He's never won lacking 0:02:08.760 --> 0:02:12.080 in confidence. And for him to throw out, you know, 0:02:12.160 --> 0:02:15.240 twenty to thirty percent sales increase for next year, I 0:02:15.240 --> 0:02:19.280 think was very surprising to people. After you know, we're 0:02:20.240 --> 0:02:23.800 nine ten months into the year and they've delivered fewer 0:02:23.880 --> 0:02:26.240 vehicles in twenty twenty four than they did in twenty 0:02:26.280 --> 0:02:26.760 twenty three. 0:02:27.400 --> 0:02:29.680 Hey, Craig, So when I'm walking around New York City 0:02:29.800 --> 0:02:32.680 ever so often, every so often I will see, to 0:02:32.800 --> 0:02:36.520 my surprise, a cyber truck. What is the leaatest on that? 0:02:36.760 --> 0:02:39.280 What do they say in earnings? What can we expect there? 0:02:40.680 --> 0:02:45.040 Yeah, they said that it was gross margin positive for 0:02:45.080 --> 0:02:47.200 the first time in the most recent quarter. And so 0:02:47.600 --> 0:02:51.239 we're almost we're roughly a year into the launch of 0:02:51.520 --> 0:02:54.120 that vehicle. So I would I would say that's a 0:02:54.120 --> 0:02:58.079 little on the early side, just relative to how Tesla 0:02:58.120 --> 0:03:01.560 has you know, are done with with the new vehicle 0:03:01.639 --> 0:03:05.400 launches in the past. So so that is another another 0:03:05.440 --> 0:03:08.919 positive I think, you know, in terms of volume, it's 0:03:08.960 --> 0:03:12.560 it's still quite low relative to the Model Y and 0:03:12.600 --> 0:03:14.520 the Model three. That is still where you see the 0:03:14.600 --> 0:03:18.720 vast majority of of Tesla's deliveries, so much so that 0:03:18.760 --> 0:03:22.360 Tesla has even yet to break out that that vehicle. 0:03:23.320 --> 0:03:26.760 And in terms of you know, quarterly results, and so 0:03:28.280 --> 0:03:30.600 you know, I think we have a rough idea of 0:03:30.639 --> 0:03:34.240 how many they've sold. Ironically, based on the recalls that 0:03:34.480 --> 0:03:37.320 the company has had to do with the vehicle. It's 0:03:37.360 --> 0:03:40.680 it's as of the latest recall was, which was just 0:03:40.720 --> 0:03:43.120 a few weeks ago. It was around twenty seven thousand units, 0:03:43.160 --> 0:03:46.120 I believe, So, you know, that's that's pretty small for 0:03:46.280 --> 0:03:50.560 a company that you know, may sell somewhere around one 0:03:50.560 --> 0:03:52.280 point eight million vehicles this year. 0:03:53.960 --> 0:03:58.000 Where is the the focus from the company here in 0:03:58.080 --> 0:03:59.560 terms of they've seems like they have a lot of 0:03:59.560 --> 0:04:06.400 balls in their obviously the car business itself, robotaxis, artificial intelligence. 0:04:06.400 --> 0:04:08.600 What do they what do you think they really want 0:04:08.880 --> 0:04:10.960 you to focus on? What does Elon want investors to 0:04:11.000 --> 0:04:11.400 focus on? 0:04:11.400 --> 0:04:11.800 Do you think? 0:04:12.880 --> 0:04:15.800 I think that's actually really one of the most interesting 0:04:15.880 --> 0:04:18.920 things here. And I think Liam Denning's column for Bloomberg 0:04:18.960 --> 0:04:21.480 Opinion this morning, uh, you know, does a great job 0:04:21.520 --> 0:04:24.080 of laying out this idea that uh, you know, Musk's 0:04:24.120 --> 0:04:27.799 emphasis has really been on, you know, don't don't bother 0:04:27.920 --> 0:04:31.360 with the here and now, forget uh you know, forget 0:04:31.360 --> 0:04:34.600 that the near term earnings. The sort of big potential 0:04:34.640 --> 0:04:36.880 for this company has to do with, you know, selling 0:04:36.880 --> 0:04:41.479 self driving cars and humanoid robots and and things that uh, 0:04:41.600 --> 0:04:44.279 you know, we've heard Elon talk about time and time again, 0:04:44.480 --> 0:04:47.839 but not actually deliver. Uh. And I think you know, 0:04:47.920 --> 0:04:50.480 if if if you're sort of looking at this company 0:04:50.560 --> 0:04:53.400 sort of class half full. It's it's uh, you know, 0:04:53.600 --> 0:04:57.760 I'm I'm less concerned than I am today about the 0:04:57.800 --> 0:05:00.359 here and now of this company and the earnings power 0:05:00.480 --> 0:05:05.880 of Tesla and its current business, and therefore, you know, 0:05:06.000 --> 0:05:09.680 more encouraged that they have, you know, the ability and 0:05:09.720 --> 0:05:13.000 the time and the financial wherewithal to go out and 0:05:13.080 --> 0:05:16.120 pursue those you know, big stretch goals that Musk has 0:05:16.400 --> 0:05:19.520 stepped for the company, and you know, depending on who 0:05:19.520 --> 0:05:22.360 you ask, you know may or may not be able 0:05:22.400 --> 0:05:25.520 to actually follow through on his various predictions. 0:05:26.080 --> 0:05:28.560 Well, from an equity perspective, this stock has been all 0:05:28.640 --> 0:05:30.359 over the place this year. I mean we were just 0:05:30.400 --> 0:05:32.279 looking earlier and year to date the stock was in 0:05:32.279 --> 0:05:34.320 the red. Now it seems as though today's games have 0:05:34.720 --> 0:05:37.479 pushed it to drift about eight ten percent higher for 0:05:37.640 --> 0:05:40.400 the year. What's the goal case here? What are people saying, 0:05:40.600 --> 0:05:42.960 how many how much legs do they have to run? 0:05:43.400 --> 0:05:46.080 Can the stock go much further? What's the consensus there? 0:05:47.600 --> 0:05:50.359 You're absolutely right. I mean back in April this was 0:05:50.360 --> 0:05:52.760 a stock that was down forty three percent for the year, 0:05:52.800 --> 0:05:55.960 and so for them to have, you know, come all 0:05:56.000 --> 0:05:58.800 the way back. They it sold off quite a bit, 0:05:59.720 --> 0:06:03.520 you know, after the Robotaxi unveiling just a few weeks ago, 0:06:04.600 --> 0:06:08.799 and you know, we we've now seen the shares go 0:06:08.800 --> 0:06:10.920 go positive again for the year. We'll see if they 0:06:11.040 --> 0:06:15.200 stay in positive territory. I think, you know, whether whether 0:06:15.360 --> 0:06:19.920 or not the company can can actually grow next year 0:06:20.120 --> 0:06:23.360 with deliveries, I think is really important because even Musk, 0:06:23.880 --> 0:06:26.120 who's you know, sort of perpetually said, you know, next 0:06:26.200 --> 0:06:29.200 year will be our year for autonomy, even he is saying, 0:06:29.400 --> 0:06:31.880 you know that that this cyber cab that they showed 0:06:31.920 --> 0:06:33.800 a couple of weeks ago isn't going to be ready 0:06:33.800 --> 0:06:36.440 in twenty twenty six, and so we need this company 0:06:36.480 --> 0:06:41.080 to bring you know, more affordable vehicles to market, to 0:06:41.080 --> 0:06:45.520 to make teslas more accessible to to to more consumers 0:06:45.560 --> 0:06:50.279 and get back to when it's you know, growing again, 0:06:50.880 --> 0:06:53.240 to put it to put it, put it simply, and 0:06:53.800 --> 0:06:56.360 you know, I think it's still unclear what exactly they 0:06:56.400 --> 0:07:00.560 have to offer that's going to make make help them 0:07:00.600 --> 0:07:00.920 get there. 0:07:01.920 --> 0:07:04.560 Craig, thanks so much for joining us. Really appreciate getting 0:07:04.560 --> 0:07:06.760 some of your time and perspective. Craig Trudell, He's a 0:07:06.760 --> 0:07:10.240 global autos editor for Bloomberg News. He's based in London, 0:07:10.320 --> 0:07:12.720 joining us via that zoom thing. You know, I think 0:07:12.760 --> 0:07:14.280 for me, and I think for a lot of investors 0:07:14.320 --> 0:07:15.720 and a lot of people that just think about the 0:07:15.720 --> 0:07:19.080 EV business, what is the ultimate demand out there for EV's. 0:07:19.080 --> 0:07:21.200 We had the early adopters, go, We've had the people 0:07:21.280 --> 0:07:22.520 that just love the technology. 0:07:22.640 --> 0:07:24.080 You know, they've bought their evs. 0:07:25.640 --> 0:07:28.320 Now it's about okay, Now I got to service the 0:07:28.320 --> 0:07:31.679 rest of the people the exact one value the people 0:07:31.760 --> 0:07:33.360 they may want cool design. 0:07:33.120 --> 0:07:34.480 Get the rest of us on board. 0:07:34.600 --> 0:07:36.440 Yeah, So I'm just not sure how that plays on. 0:07:36.600 --> 0:07:39.160 We've seen some of the existing auto manufacturers, like the 0:07:39.200 --> 0:07:40.400 Volkswagens and Fords kind of. 0:07:40.360 --> 0:07:41.400 Pulled back a little bit exactly. 0:07:41.440 --> 0:07:43.640 They started to pull back on their development there because 0:07:43.640 --> 0:07:46.000 they weren't really seeing demand as you just mentioned. So 0:07:46.040 --> 0:07:47.840 I think it's really interesting when we think about the 0:07:47.840 --> 0:07:50.440 broader landscape and whether or not they're actually going to 0:07:50.480 --> 0:07:52.280 be able to attract the broader group. 0:07:52.440 --> 0:07:53.080 Yeah. 0:07:53.120 --> 0:07:55.160 You know, you got that whole thing about the charging network. 0:07:55.160 --> 0:07:56.440 You got to you know a lot of people I 0:07:56.520 --> 0:07:59.160 talked to so say, when the charging network is like 0:07:59.200 --> 0:08:00.960 the gasoline state, network in this country. 0:08:01.160 --> 0:08:02.600 That's one I'll think about an EP. 0:08:02.720 --> 0:08:05.560 I don't know how that all plays out, but great 0:08:05.640 --> 0:08:07.560 day for Tesla and Edge shareholders. 0:08:09.080 --> 0:08:12.960 You're listening to the Bloomberg Intelligence Podcast. Catch us live 0:08:13.040 --> 0:08:16.560 weekdays at ten am Eastern on applecard Play and Android 0:08:16.600 --> 0:08:19.360 Auto with the Bloomberg Business App. You can also listen 0:08:19.480 --> 0:08:22.560 live on Amazon Alexa from our flagship New York station 0:08:22.920 --> 0:08:27.480 Just say Alexa playing Bloomberg eleven thirty. 0:08:27.120 --> 0:08:30.760 Following not getting the deal done? What's going on there? 0:08:30.800 --> 0:08:32.240 Because they need to get people back to work. They 0:08:32.280 --> 0:08:34.600 need to start cracking out some airplanes and getting some 0:08:34.640 --> 0:08:36.520 cash into the door. Next guest has some thoughts on 0:08:36.559 --> 0:08:41.079 all this whole labor negotiation, unrest issues, workplace issues. 0:08:41.120 --> 0:08:42.000 Jessica Kriegel joints. 0:08:42.000 --> 0:08:45.079 It's in our Bloomberg Interactive Broker Studio chief scientists of 0:08:45.200 --> 0:08:49.520 Workplace Culture and the firm is named Culture Partners. So 0:08:49.559 --> 0:08:51.760 there you go, joining us here in our Bloomberg Interactive 0:08:51.760 --> 0:08:55.560 Broker Studio. Thirty five percent seen or thirty percent whatever. 0:08:55.600 --> 0:08:58.040 It was seemed pretty good to me, helping out with 0:08:58.160 --> 0:09:01.320 the four to one k's. Then labor comes back with 0:09:01.600 --> 0:09:04.920 defined pensions. Now my response would be nobody. I'm six 0:09:05.080 --> 0:09:07.040 years old. I don't know one person with a defined 0:09:07.080 --> 0:09:11.160 benefit pension plan that's nineteen seventies. Can you give us 0:09:11.200 --> 0:09:15.000 your thoughts about what's happening between Boeing and their striking workers. 0:09:15.440 --> 0:09:16.080 How do you view it? 0:09:16.679 --> 0:09:18.959 I don't know anyone that has a pension anymore these days, 0:09:18.960 --> 0:09:21.240 but they've been asking for it since the beginning, and 0:09:21.400 --> 0:09:24.000 it's a non starter. They're not going to get the pensions. 0:09:24.040 --> 0:09:26.320 I think Boeing will literally go bankrupt if they have 0:09:26.360 --> 0:09:28.520 to give up those pensions. But they have been asking 0:09:28.520 --> 0:09:32.360 for forty percent since the beginning. Boeing originally offered twenty five. 0:09:32.480 --> 0:09:36.520 They said overwhelmingly absolutely not enough. Then they came back 0:09:36.520 --> 0:09:39.360 at thirty percent, which was their quote unquote best and 0:09:39.440 --> 0:09:41.800 final offer, but apparently not because two weeks later they 0:09:41.800 --> 0:09:44.400 came back with thirty five percent. And they've got two 0:09:44.600 --> 0:09:48.160 thirds of the union that is still saying that's not enough, 0:09:48.200 --> 0:09:51.120 a third has been converted, a third did say yeah, 0:09:51.160 --> 0:09:52.880 I'll go back to work for that. So they're getting 0:09:52.920 --> 0:09:55.600 closer and they're going to have to bridge that gap. 0:09:55.679 --> 0:09:57.400 I think they'll have to go to forty percent, and 0:09:57.800 --> 0:09:59.560 since they're probably not going to get the pension, they 0:09:59.600 --> 0:10:01.560 might have to go above forty percent. They might have 0:10:01.600 --> 0:10:04.160 to go to forty five percent in order to say 0:10:04.240 --> 0:10:06.400 no pensions. But we'll give you more, and we'll give 0:10:06.440 --> 0:10:08.240 you a bigger signing bonus to make up for all 0:10:08.240 --> 0:10:10.320 the time that they haven't been paid. It's hard right now. 0:10:10.200 --> 0:10:11.160 For the union workers. 0:10:11.880 --> 0:10:14.160 Jessica, I know that you are of the opinion that 0:10:14.360 --> 0:10:17.000 management has been so focused on their balance sheet that 0:10:17.040 --> 0:10:20.800 they've pretty much forgotten about the workplace culture. What does 0:10:20.840 --> 0:10:22.800 that look like? I mean, how do you kind of 0:10:22.800 --> 0:10:24.680 turn that around? You did say that it seems like 0:10:24.679 --> 0:10:25.840 it's a little bit too late now. 0:10:26.240 --> 0:10:29.559 Yeah, I mean CEOs all over the world are focused 0:10:29.600 --> 0:10:32.320 on driving results right now, and some can take that 0:10:32.440 --> 0:10:35.640 so literally to only mean focusing on the financial results. 0:10:35.679 --> 0:10:37.960 But as we're seeing with Boeing, this is a classic 0:10:38.080 --> 0:10:41.000 example if you focus so much on the financials and 0:10:41.040 --> 0:10:43.520 not on the hearts and minds of your employees and 0:10:43.559 --> 0:10:45.920 bringing people along for the ride. Culture is really about 0:10:45.920 --> 0:10:49.120 how you think and act. It's not about the buzzwords 0:10:49.160 --> 0:10:51.640 you have on a poster board about your values. Kelly 0:10:51.760 --> 0:10:53.600 Orper did an interview the other day saying we got 0:10:53.640 --> 0:10:55.560 to focus on culture change, and we're doing that right 0:10:55.559 --> 0:10:59.199 now by revisiting our values. I mean, is that really 0:10:59.240 --> 0:11:01.440 going to move the need for the people who feel 0:11:01.440 --> 0:11:04.640 so much resentment, feel like they've lost so much, they 0:11:04.679 --> 0:11:08.120 have to see leaders take the lead on culture change, 0:11:08.160 --> 0:11:10.880 which means pay us what we think we're owed, show 0:11:10.960 --> 0:11:13.360 up on the floor, stop focusing so much on the 0:11:13.400 --> 0:11:17.560 balance seat, and also focus on quality control. Also focus 0:11:17.640 --> 0:11:20.800 on what we as people bring to the organization and 0:11:20.840 --> 0:11:21.360 what we need. 0:11:21.640 --> 0:11:26.520 High school buddy Mine life long engineer at Boeing in Seattle, 0:11:27.080 --> 0:11:29.680 and he says, hey, you know, he's not a radical dude, 0:11:29.679 --> 0:11:31.480 He's just saying, hey, this is what I think happened. 0:11:31.520 --> 0:11:35.040 They've management left the c suite, left Seattle twenty years 0:11:35.040 --> 0:11:35.840 ago for Chicago. 0:11:35.960 --> 0:11:37.240 Now they're in DC. 0:11:38.120 --> 0:11:41.880 That felt to a lot of these engineering types who 0:11:41.920 --> 0:11:44.640 take pride in the work that we lost their support, 0:11:44.760 --> 0:11:48.840 or we lost their support of the engineers drive Boeing 0:11:49.360 --> 0:11:52.080 and they started focusing more on profitability as opposed to 0:11:52.080 --> 0:11:53.600 the engineering prowess of Boeing. 0:11:54.040 --> 0:11:55.200 And that's twenty years ago. 0:11:55.440 --> 0:11:59.520 Yeah, and one could argue they think that's the beginning 0:11:59.679 --> 0:12:01.800 of perhaps some of these problems that we're now seeing 0:12:01.800 --> 0:12:05.120 twenty years later, I don't know how you get that back. 0:12:05.400 --> 0:12:07.280 Well. I think they've done a good job actually, because 0:12:07.360 --> 0:12:11.440 Kelly Orperg is someone with an engineering background, so they 0:12:11.440 --> 0:12:13.760 have realized they don't need to be encounter at the 0:12:13.800 --> 0:12:16.120 c suite level. They need someone who's been an engineer, 0:12:16.160 --> 0:12:18.439 who understands he's saying, let's get back to the floor. 0:12:18.760 --> 0:12:21.000 He bought a house in Seattle. He said, we're going 0:12:21.040 --> 0:12:23.920 back to Seattle. So there is already a shift to 0:12:24.120 --> 0:12:26.800 make up for what that is a well documented complaint 0:12:26.800 --> 0:12:28.920 that the union workers has if you lost the soul 0:12:28.960 --> 0:12:31.000 of this company, and this is a fight for the soul, right. 0:12:31.040 --> 0:12:33.560 I always tell people that one of the great drives 0:12:33.559 --> 0:12:35.840 from an airport to a downtown is in Seattle. You 0:12:36.280 --> 0:12:38.319 get out of your plane in Sea Tech, you get 0:12:38.320 --> 0:12:40.240 on one over that eye whatever that is, and you 0:12:40.360 --> 0:12:41.120 drive to Seattle. 0:12:41.120 --> 0:12:42.480 It's about a forty minute drive in. 0:12:42.840 --> 0:12:45.640 On the left of you on the highway for almost 0:12:45.640 --> 0:12:49.480 forty miles is Boeing, and it's airfield after airfre right, 0:12:49.480 --> 0:12:52.120 and hangar after hangar, and plane after plane, and they're 0:12:52.160 --> 0:12:54.679 taken off and flane. All about that to me is 0:12:54.720 --> 0:12:57.839 Boeing and the fact when senior management left there, it 0:12:57.880 --> 0:13:00.360 seemed like for a lot of people, oh lost to 0:13:00.400 --> 0:13:01.080 heart and soul there. 0:13:01.160 --> 0:13:03.880 So, in building off of Paul's earlier question, I'm curious, 0:13:04.280 --> 0:13:06.000 did it seem as though there was a stronger, more 0:13:06.040 --> 0:13:08.840 intense crackdown after all the hiccups that Boeing has seen 0:13:08.840 --> 0:13:10.679 this year, or does this seem like it's kind of 0:13:10.679 --> 0:13:13.120 been a bubbling up point and it's finally bubbling over. 0:13:13.280 --> 0:13:15.800 As to why workers are so unhappy. 0:13:15.480 --> 0:13:18.920 Well, Boeing has had a lot of very public embarrassments 0:13:19.160 --> 0:13:21.520 right in recent times, and I think the employees are 0:13:21.520 --> 0:13:26.600 saying the executives are not protecting the company's brand and reputation, 0:13:26.760 --> 0:13:29.520 so we will We are not okay with the quality control, 0:13:29.600 --> 0:13:31.840 we are not okay with the way that production has 0:13:31.880 --> 0:13:34.400 deteriorated over time, and so we are going to fight 0:13:34.520 --> 0:13:36.880 to do things the right way. Because these are engineers 0:13:36.880 --> 0:13:39.920 who take a lot of value. They love the fact 0:13:39.920 --> 0:13:42.920 that they can produce some of the most high quality 0:13:42.960 --> 0:13:45.720 machines in the world. Right they don't want to create 0:13:46.640 --> 0:13:49.200 garbage material anymore. So they're fighting for it. And I 0:13:49.200 --> 0:13:51.800 think this is something that will get resolved. It will 0:13:51.800 --> 0:13:54.120 absolutely get resolved. They're going to get back to the table. 0:13:54.480 --> 0:13:56.360 Maybe a few more weeks. Some people say we're only 0:13:56.360 --> 0:13:59.040 at the halfway point. Either way, they're going to come together. 0:13:59.120 --> 0:14:00.960 Boeing will get back on track. I'm not worried about 0:14:00.960 --> 0:14:01.800 the future of the company. 0:14:01.880 --> 0:14:03.760 Let's pivot a little bit away from Boeing get back 0:14:03.760 --> 0:14:06.000 to another key issue which I keep raising because I 0:14:06.000 --> 0:14:08.920 just wonder how things revolving. Are people back in the office, 0:14:08.960 --> 0:14:12.360 what's the new oral? I guess we are when you 0:14:12.400 --> 0:14:14.960 talk to your clients. Yeah, Are we in a permanent 0:14:15.000 --> 0:14:15.920 hybrid situation? 0:14:16.040 --> 0:14:16.240 Now? 0:14:16.440 --> 0:14:16.640 No? 0:14:16.760 --> 0:14:18.720 I mean right now. I think twenty twenty five is 0:14:18.760 --> 0:14:20.720 going to be the year of forcing people back into 0:14:20.720 --> 0:14:23.360 the office. Amazon just made an announcement that people have 0:14:23.400 --> 0:14:25.560 to be back five days a week. I think that 0:14:25.680 --> 0:14:28.920 is regressive thinking, if you want my personal opinion, because 0:14:29.080 --> 0:14:31.280 think of the language people use when they talk about 0:14:31.400 --> 0:14:34.440 return to the office. Go back to the office. It's 0:14:34.480 --> 0:14:37.800 going backwards, as if COVID was just a pause and 0:14:37.840 --> 0:14:40.360 now we can press play again and nothing's changed. But 0:14:40.400 --> 0:14:43.240 the reality is culture has changed. If culture is how 0:14:43.280 --> 0:14:46.040 people think and act, we had a major experience that 0:14:46.280 --> 0:14:49.200 evolved our thinking about how we can be productive. And 0:14:49.240 --> 0:14:51.240 I think companies that are forcing people back into the 0:14:51.280 --> 0:14:53.600 office are counting on some people to leave that it's 0:14:53.600 --> 0:14:56.600 a way to do layoffs without doing layoffs, and they're 0:14:57.000 --> 0:15:01.800 relying on activity based manager. It's easy to manage activity 0:15:01.840 --> 0:15:03.960 of your employees if you can see them at the desk. 0:15:04.440 --> 0:15:06.840 The more elevated way of leading a team is to 0:15:06.920 --> 0:15:09.240 manage to outcomes and you don't have to be in 0:15:09.320 --> 0:15:12.080 the office to manage to outcomes. So companies that want 0:15:12.120 --> 0:15:15.400 the competitive edge on attracting talent from all over the nation, 0:15:15.760 --> 0:15:17.520 they're going to allow people to work from home. And 0:15:17.600 --> 0:15:20.280 companies that have a real estate bill that they're worried about, 0:15:20.280 --> 0:15:22.040 they're going to force people back into the office. 0:15:22.240 --> 0:15:25.040 And I mean our incentives enough as food and all 0:15:25.080 --> 0:15:27.400 the different things enough to lure people back into the office. 0:15:27.440 --> 0:15:28.760 Or do you think that a lot of people are 0:15:28.800 --> 0:15:31.680 really hard and fast I want to be removed. 0:15:31.720 --> 0:15:33.480 Well, it depends on the person, right There are some 0:15:33.520 --> 0:15:36.240 people who are just excited to get back into the office. 0:15:36.280 --> 0:15:40.240 They want the kombucha Fridays and the Hawaiian shirt Tuesdays 0:15:40.320 --> 0:15:42.640 or whatever it is that people do right now to 0:15:42.720 --> 0:15:46.080 create quote unquote culture. Those are not culture things. Those 0:15:46.120 --> 0:15:49.480 are just perks, they're fun. Ultimately, it's how are we 0:15:49.520 --> 0:15:52.560 making decisions, how are people thinking? How are we committed 0:15:52.600 --> 0:15:55.080 to the mission of the organization? And I can do 0:15:55.200 --> 0:15:57.080 that at home or I can do that in the office. 0:15:57.120 --> 0:16:00.200 And I would ask, if you're questioning right now as 0:16:00.240 --> 0:16:01.920 a leader, whether or not you should force people back 0:16:01.960 --> 0:16:04.000 into the office. Is think about what are the results 0:16:04.040 --> 0:16:07.600 we're trying to achieve, What are the shared beliefs within 0:16:07.640 --> 0:16:09.920 our team that are getting in the way of hitting 0:16:09.960 --> 0:16:11.880 those results, and what do we need those beliefs to 0:16:11.920 --> 0:16:14.040 be And is working from home going to help drive 0:16:14.080 --> 0:16:16.800 those correct beliefs that will get us the results or not. 0:16:17.040 --> 0:16:20.120 That's really the deeper work of leadership, rather than add 0:16:20.240 --> 0:16:21.920 do we get people in the office three or five 0:16:22.000 --> 0:16:23.840 days a week? So that's that's arbitrary. 0:16:23.960 --> 0:16:26.080 I think that Amazon might be a little bit of 0:16:26.120 --> 0:16:27.560 harbring rym. We might see more companies. 0:16:27.800 --> 0:16:30.840 Yeah, well absolutely. Also, Amazon is not going to have 0:16:30.880 --> 0:16:34.000 trouble replacing people that that don't want right because it's Amazon, 0:16:34.440 --> 0:16:37.040 and so there are companies like that that can do 0:16:37.120 --> 0:16:39.760 whatever they want and they'll be able to hire other companies. 0:16:39.760 --> 0:16:41.480 They have to be a little bit more strategic about 0:16:41.480 --> 0:16:42.520 how theyre going to attract talent. 0:16:42.760 --> 0:16:43.120 Interesting. 0:16:43.160 --> 0:16:46.400 I guess it's just ever evolving, satary evolved a Bloomberg 0:16:46.480 --> 0:16:46.960 or four. 0:16:46.880 --> 0:16:49.960 Days a week. I don't know, you will see. I'm 0:16:49.960 --> 0:16:51.640 fine a week working. Just find for me. 0:16:51.960 --> 0:16:54.720 Jessica Krigle, thank you so much for joining us. Jessica Krikles, 0:16:54.760 --> 0:16:58.440 she's a chief scientist of workplace culture at Culture Partners, 0:16:58.480 --> 0:17:01.640 joining us. Lifer in a Bloomberg interactive studio talking about 0:17:01.640 --> 0:17:04.520 Boeing and just kind of the workplace in general, kind 0:17:04.520 --> 0:17:07.120 of the evolving US workplace. 0:17:08.560 --> 0:17:12.360 You're listening to the Bloomberg Intelligence podcast. Catch us live 0:17:12.520 --> 0:17:15.200 weekdays at ten am Eastern on Affo card Playing and 0:17:15.320 --> 0:17:18.200 broud Otto with the Bloomberg Business app. Listen on demand 0:17:18.280 --> 0:17:21.880 wherever you get your podcasts, or watch us live on YouTube. 0:17:23.520 --> 0:17:26.280 All Right, it is earnings, fast and furious. I think 0:17:26.320 --> 0:17:28.200 today was probably the busiest day, or will be the 0:17:28.240 --> 0:17:31.320 busiest day of the week. What's been a busy week, 0:17:31.960 --> 0:17:33.960 and we've heard from pretty much everybody across the board, 0:17:33.960 --> 0:17:35.920 all types of industries. One of the companies is United 0:17:35.920 --> 0:17:38.720 Parcel Service UPS came out with some numbers. The stock 0:17:38.800 --> 0:17:41.680 is up five percent, today, So some pretty good numbers. 0:17:41.720 --> 0:17:44.560 Presumably Lee Claskal is he's right here now to Lee Clascott, 0:17:44.640 --> 0:17:47.840 Senior Transport Logistics and Shipping annols for Bloomberg Intelligence. He 0:17:47.960 --> 0:17:51.200 joins us from our Princeton, New Jersey offices. Hayley talk 0:17:51.200 --> 0:17:53.560 to us about UPS stocks up five percent. So I 0:17:53.640 --> 0:17:54.960 guess the market like what they saw. 0:17:55.960 --> 0:17:58.399 Yeah, hey, Paul, Yeah, So UPS had a pretty good 0:17:58.440 --> 0:18:02.040 print this morning, and they all so you know, indicated 0:18:02.119 --> 0:18:04.439 that earnings might be a little better than expectations are 0:18:04.480 --> 0:18:05.240 in the fourth quarter. 0:18:05.600 --> 0:18:07.480 UPS has been kind of a show me story. 0:18:07.520 --> 0:18:09.760 They've been doing a lot of self help things, but 0:18:10.320 --> 0:18:13.960 a lot of those initiatives really haven't bubbled up to 0:18:14.800 --> 0:18:18.080 the bottom line or the revenue numbers, just given the 0:18:18.119 --> 0:18:21.800 difficult backdrop. And what we saw today was earnings per 0:18:21.880 --> 0:18:26.399 share finally inflected, earnings per share growth finally inflected positively 0:18:27.200 --> 0:18:31.359 after seven quarterly declines. So I see things seem to 0:18:31.440 --> 0:18:35.000 be working for UPS. And you know, we expect earnings 0:18:35.040 --> 0:18:38.119 expectations for the fourth quarter and probably next year to 0:18:38.200 --> 0:18:40.920 move higher on kind of the progress that they've made 0:18:40.960 --> 0:18:41.360 thus far. 0:18:42.000 --> 0:18:44.239 Hey, Lee, I mean you mentioned that difficult backdrop. As 0:18:44.280 --> 0:18:46.840 I'm looking at ups, we're seeing shares down about twelve 0:18:46.920 --> 0:18:49.600 percent year to date. As we're thinking about the future, 0:18:49.680 --> 0:18:51.520 I mean, how much of a move higher do you 0:18:51.600 --> 0:18:54.480 really anticipate as we're thinking about the year end, should 0:18:54.480 --> 0:18:55.959 investors start to see some gains here? 0:18:57.000 --> 0:19:00.000 Well, we don't do buy whole cell recommendations of Bloomberg Intelligence, 0:19:00.280 --> 0:19:02.040 but you know, what we can tell you is that 0:19:02.440 --> 0:19:05.040