WEBVTT - Boeing Wins Largest-Ever Order as Qatar Buys Long-Range Jets 0:00:02.720 --> 0:00:09.040 Bloomberg Audio Studios, podcasts, radio news, and Android auto with 0:00:09.119 --> 0:00:12.240 the Bloomberg Business App. Listen on demand wherever you get 0:00:12.240 --> 0:00:15.040 your podcasts, or watch us live on YouTube. 0:00:15.640 --> 0:00:17.159 One of the big stories that come out of this 0:00:17.720 --> 0:00:20.239 trip to the Middle East, at least for the Boeing company, 0:00:20.360 --> 0:00:23.919 Boeing won the single biggest deal in US planemaker's history, 0:00:23.960 --> 0:00:27.000 with Qatar Airways placing in order for at least one 0:00:27.040 --> 0:00:29.600 hundred and sixty wide body aircraft during. 0:00:29.320 --> 0:00:33.040 A visit to Doha by US President Donald Trump. So 0:00:33.080 --> 0:00:34.160 we're going to dig into that story. 0:00:34.200 --> 0:00:37.559 Sid, Philip joints his deputy team leader for Global Aviation 0:00:38.400 --> 0:00:41.159 a good day for Boeing here, what do you make 0:00:41.200 --> 0:00:41.400 of it? 0:00:41.440 --> 0:00:43.919 Sid's what's Boeing saying about this? 0:00:44.520 --> 0:00:46.519 So Boeing hasn't already said a whole lot about this, 0:00:46.600 --> 0:00:49.280 But I mean, this is a significant deal for Boeing 0:00:49.360 --> 0:00:52.480 because they can sort of add another sort of milestone 0:00:52.600 --> 0:00:55.360 order to their backlog, especially for their seven eighty seven, 0:00:55.800 --> 0:00:58.040 which is the sort of state of the odd white 0:00:58.080 --> 0:01:01.480 Buddy jet, as well as potential for the Triple seven X, 0:01:01.520 --> 0:01:04.120 which is again a jet that Katara Airways has ordered 0:01:04.120 --> 0:01:07.520 and is still to be certified and so as airlines 0:01:07.560 --> 0:01:09.880 sort of look to the next generation of aircraft that 0:01:09.880 --> 0:01:12.520 they're looking to order, this is sort of these are 0:01:12.560 --> 0:01:14.360 these You're going to see these mega deals coming up 0:01:14.400 --> 0:01:17.640 where everyone's looking to sort of replace their current generation 0:01:17.720 --> 0:01:21.360 planes with newer models which are more advanced, better fuel economy, 0:01:21.600 --> 0:01:23.720 and that sort of great for Boeing in terms of 0:01:23.800 --> 0:01:26.000 just building out that backlog and sort of selling out 0:01:26.040 --> 0:01:28.240 aircraft past the end of the decade. 0:01:29.120 --> 0:01:32.039 What is the delivery time for something like this, but 0:01:32.080 --> 0:01:35.240 when it's clearly had some operational execution issues exactly. 0:01:35.280 --> 0:01:37.240 I mean Boeing has been struggling to deliver both the 0:01:37.280 --> 0:01:39.720 seven eight seven as well as seven three seven Max 0:01:39.800 --> 0:01:42.520 and get the seven Triple seven X, which is their 0:01:42.600 --> 0:01:46.160 latest sort of generation aircraft certified. So it is we're 0:01:46.160 --> 0:01:48.320 still not clear on the details for what the sort 0:01:48.360 --> 0:01:51.760 of intricacies of this Qatara deal are, but potentially these 0:01:51.800 --> 0:01:53.760 will sort of play out and go out into the 0:01:53.800 --> 0:01:56.560 next decade because I mean, they've got a significant backlog 0:01:56.560 --> 0:01:59.040 of aircraft that need to deliver in the short term. 0:01:59.120 --> 0:02:00.960 So this is not going to be aircraft deal that 0:02:01.000 --> 0:02:03.280 sort of happens in the next two or three years. 0:02:03.440 --> 0:02:06.160 Is going to be a drawnout deal that goes into 0:02:06.200 --> 0:02:07.840 the next into the next decade. 0:02:08.160 --> 0:02:09.400 Well, stock market likes it. 0:02:09.440 --> 0:02:11.960 Stocks up one point four percent today, Boeing is hitting 0:02:12.000 --> 0:02:14.000 a fifty two week HI. It's up sixteen and a 0:02:14.000 --> 0:02:17.000 half percent year to date, So maybe Boeing's finally digging 0:02:17.000 --> 0:02:19.200 itself out of its hole from the last several years. 0:02:19.360 --> 0:02:21.600 So that kind of goes to the big question said, 0:02:22.080 --> 0:02:25.200 it's all about production, you know, getting planes off, and 0:02:25.240 --> 0:02:27.800 people just say, like George Fergus from Bloomberg Intelligence says, 0:02:27.840 --> 0:02:30.359 just focus on the seven thirty seven Max deliveries. That's 0:02:30.400 --> 0:02:34.320 the number. Is there a sense that Boeing's making improvements there? 0:02:34.760 --> 0:02:37.560 We have seen Boeing deliveries inch up and we've sort 0:02:37.600 --> 0:02:40.400 of they've had sort of milestone in terms of just 0:02:40.480 --> 0:02:43.919 hitting better production levels on the sevent three seven, And 0:02:44.280 --> 0:02:47.440 we've heard from Aline customers, including United Airlines yesterday saying 0:02:47.480 --> 0:02:49.840 that the deliveries of the seven three seven Max are 0:02:49.880 --> 0:02:52.080 sort of going up and they're waiting on the seven 0:02:52.200 --> 0:02:54.799 eighty seven, which is the aircraft that we understand that 0:02:54.880 --> 0:02:57.840 Katara Airways ordered. That's also going to be sort of 0:02:57.919 --> 0:03:00.760 key to getting production and profitability going. 0:03:01.840 --> 0:03:04.840 What other kind of pitch can Boeing make to outstrip 0:03:04.919 --> 0:03:07.440 Airbus because in a duopoly market, and I appreciate that 0:03:07.520 --> 0:03:09.400 China has some smaller players, but if you're dealing with 0:03:09.440 --> 0:03:12.680 a duopoly, like I mean, people got to buy your 0:03:12.720 --> 0:03:14.160 planes exactly. 0:03:13.880 --> 0:03:16.239 I mean, we have adopoly in at the moment. 0:03:16.360 --> 0:03:19.000 And does that change it all? You think? It sort 0:03:19.000 --> 0:03:19.480 of has. 0:03:19.440 --> 0:03:22.320 Changed a little bit in terms of just the sort 0:03:22.320 --> 0:03:24.880 of there's a lot of politics behind aircraft orders again, 0:03:24.919 --> 0:03:27.880 and that's something that we've seen where Trump's been announcing 0:03:27.960 --> 0:03:30.680 these mega Boeing orders. I mean, yesterday announced the deal 0:03:30.760 --> 0:03:34.120 for thirty planes in Saudi Arabia, and so there is 0:03:34.160 --> 0:03:36.320 a lot of politics attached to aircraft orders. But at 0:03:36.320 --> 0:03:39.040 the same time, both Airbus and Boeing are sort of 0:03:39.080 --> 0:03:41.320 sold out of aircraft until the end of the decades. 0:03:41.400 --> 0:03:44.920 So it is sort of you're notching up all these orders. 0:03:44.960 --> 0:03:47.320 But at the same time, the biggest thing that airlines 0:03:47.320 --> 0:03:49.920 are talking about is give me my plane, because that's 0:03:50.000 --> 0:03:53.120 really the biggest question where airlines are saying that plane 0:03:53.120 --> 0:03:56.160 deliveries are delayed, and the air Bus has repeatedly talked 0:03:56.160 --> 0:03:59.280 about how supply chain issues continue to haunt the industry 0:03:59.760 --> 0:04:01.680 now five years after the pandemic. 0:04:01.760 --> 0:04:04.880 Yeah, which I can't imagine, although again I'm what I 0:04:04.960 --> 0:04:09.080 understand is one of the bottlenecks is labor getting the 0:04:09.360 --> 0:04:11.880 This is not just you know, sitting an assembly line 0:04:11.920 --> 0:04:14.720 and hitting a hammer. You've got to be really, really 0:04:14.760 --> 0:04:17.120 skilled at labor, and during the pandemic you lost a 0:04:17.160 --> 0:04:19.960 lot of that and retraining these folks are getting new 0:04:20.000 --> 0:04:22.000 people in it. I'm hearing that's a big problem. 0:04:22.120 --> 0:04:24.080 Labor is a major problem as well as I mean, 0:04:24.600 --> 0:04:28.360 just one part being short holds up the entire production line. 0:04:28.360 --> 0:04:30.159 I mean, you have millions of parts that go into 0:04:30.200 --> 0:04:33.600 an aircraft, and Evers and Boeing are the final assembly 0:04:33.640 --> 0:04:35.960 lines where the plane actually gets put together. But then 0:04:36.279 --> 0:04:39.240 if parts are not available in the sort of process, 0:04:39.640 --> 0:04:42.000 you can't actually build those planes. And that's where the 0:04:42.000 --> 0:04:45.560 bottlenecks come up. Because you have smaller suppliers who are 0:04:45.600 --> 0:04:49.520 struggling financially, You've got parts in short supply. I mean 0:04:49.640 --> 0:04:51.839 EBUS talks about it's sort of it's whack a mole 0:04:51.920 --> 0:04:55.560 where you get one part sorted out and something else breaks, 0:04:55.600 --> 0:04:58.279 and so it's it's really a question of getting that 0:04:58.360 --> 0:05:00.680 supply chain to sort of hum along nicely and then 0:05:00.760 --> 0:05:03.839 actually building those planes and delivering those planes because you've 0:05:03.880 --> 0:05:06.920 now got record backlogs at both Boeing and Airbus. 0:05:07.120 --> 0:05:09.760 So are they exempt from tariff issues? 0:05:10.279 --> 0:05:13.159 That's again a really important question. No one's quite clear 0:05:13.240 --> 0:05:15.880 about in terms of what the tariff impact is going 0:05:15.960 --> 0:05:18.839 to be because for fifty years almost that the aviation 0:05:18.920 --> 0:05:22.520 industry has largely functioned tariff free, and the tariffs added 0:05:22.560 --> 0:05:26.080 complexity to it because now everyone's not quite sure if 0:05:26.120 --> 0:05:29.160 aircraft are example. I mean, you've seen like all sorts 0:05:29.160 --> 0:05:33.080 of industry players and industry groups making representations to President 0:05:33.120 --> 0:05:35.960 Trump saying that we would like to have tariffs removed 0:05:35.960 --> 0:05:38.919 on aircraft and aircraft parts, and so we're trying to 0:05:38.920 --> 0:05:42.560 see where that sort of actually lands up, because potentially 0:05:42.720 --> 0:05:46.039 aircraft manufacturers and airlines may have to pay tariffs on 0:05:46.120 --> 0:05:48.480 planes depending on what they're mean and what parts they have. 0:05:48.680 --> 0:05:51.240 Right, which makes all of this that much more complicated 0:05:51.240 --> 0:05:51.920 and more difficult. 0:05:51.960 --> 0:05:53.279 All right, should be great to say that. 0:05:53.320 --> 0:05:56.479 Thanks very much joining us here, said Phillip, Deputy Team 0:05:56.560 --> 0:05:59.160 leader for Global Aviation. We appreciate that. Always good to 0:05:59.160 --> 0:06:02.320 see you in New York too. Thank you. 0:06:02.320 --> 0:06:06.039 You're listening to the Bloomberg Intelligence Podcast. Catch us live 0:06:06.120 --> 0:06:09.200 weekdays at ten am Eastern on Apple Cocklay and Android 0:06:09.200 --> 0:06:12.520 Auto with the Bloomberg Business App. Listen on demand wherever 0:06:12.560 --> 0:06:16.120 you get your podcasts, or watch us live on YouTube. 0:06:16.600 --> 0:06:18.359 Alex Deal, Paul Swiney, we are live here in our 0:06:18.360 --> 0:06:21.200 Bloomberg Interactive Brokers studio in New York City, or streaming 0:06:21.240 --> 0:06:23.719 live on YouTube as well. I'm looking at the S 0:06:23.760 --> 0:06:26.760 and P five hundred, absolutely flat on the year. So 0:06:27.160 --> 0:06:30.440 you know, we were down thirteen fourteen percent of the year, 0:06:30.640 --> 0:06:35.360 peaked the trough twenty percent, climbed, you know, crawled out 0:06:35.360 --> 0:06:35.920 of that hole. 0:06:35.839 --> 0:06:37.120 Right here, and we'll see where we go from here. 0:06:37.120 --> 0:06:38.200 Sean oh Harry joins US. 0:06:38.360 --> 0:06:43.279 President Pastry Ets join us via zoom from Florida. Hey Sean, 0:06:44.040 --> 0:06:46.680 what do you do now? I mean, you're we were 0:06:46.760 --> 0:06:51.120 really selling off hard. Recession talk was getting pretty heated. 0:06:51.600 --> 0:06:54.039 Now the President has kind of walked back seemingly some 0:06:54.200 --> 0:06:57.480 of the tariff uncertainty in the marketplaces, and that seems 0:06:57.480 --> 0:07:00.520 to be enough for investors that come back into the markets. 0:07:00.560 --> 0:07:01.200 What do you guys see? 0:07:02.360 --> 0:07:04.440 Yeah, thanks for having me. I think there was three 0:07:04.480 --> 0:07:07.120 things that were sort of headwinds into the market earlier 0:07:07.120 --> 0:07:10.080 this year. One was the tariff stuff. I think, you know, 0:07:10.120 --> 0:07:11.960 I don't think anybody was surprised that he was going 0:07:12.000 --> 0:07:13.120 to make an issue of it. 0:07:13.200 --> 0:07:13.600 I think the. 0:07:16.160 --> 0:07:19.560 Severity, if you will, sort of spooked people a little bit. 0:07:19.640 --> 0:07:21.320 I never thought they were ever going to come in 0:07:21.320 --> 0:07:23.000 at that rate, you know, I always thought this was 0:07:23.000 --> 0:07:24.840 going to be a negotiation, and as you see, where 0:07:24.840 --> 0:07:27.280 are in the midst of a lot of negotiations. I 0:07:27.280 --> 0:07:32.160 think the second sort of headwind was uncertainly about tax policy, 0:07:32.720 --> 0:07:34.520 and hopefully that will get itself resolved. 0:07:34.560 --> 0:07:35.400 And then the third ist. 0:07:35.400 --> 0:07:38.760 Has always been the Fed and whether they're being too 0:07:38.840 --> 0:07:43.640 slow in terms of their approach to interest rates. One 0:07:43.680 --> 0:07:46.880 of those tailwinds I think has turned into a I 0:07:46.920 --> 0:07:48.960 mean headwinds has turned into a tailwind, and that's the 0:07:49.000 --> 0:07:49.800 tariff policy. 0:07:49.840 --> 0:07:50.880 I think we're seeing. 0:07:51.840 --> 0:07:55.520 Terrific progress there across the board, and I think we'll 0:07:55.560 --> 0:07:59.480 continue to see that. Hopefully, you know, Congress will get 0:07:59.480 --> 0:08:02.480 their act together and they'll get the quote unquote big 0:08:02.520 --> 0:08:05.440 beautiful bill done, and then we'll wait and see with 0:08:05.440 --> 0:08:08.640 regard to what's going with with with with Sherman Pale. 0:08:08.800 --> 0:08:11.440 So I think the environment has changed from a somewhat 0:08:12.120 --> 0:08:13.960 die or you know, oh gosh, we're going to have 0:08:14.000 --> 0:08:16.320 it in a recession and inflation is going to be 0:08:16.320 --> 0:08:19.320 horrible because of all these tariffs, to an environment where 0:08:19.600 --> 0:08:23.040 I think there's less talk of a recession and less 0:08:23.040 --> 0:08:27.960 concerned about the potential inflation regarding terrorists. There is, you know, 0:08:28.040 --> 0:08:29.840 some good news in this market, and that is that 0:08:30.000 --> 0:08:32.320 energy prices are down and energy has a big input 0:08:32.320 --> 0:08:34.160 to inflation. And we saw a really nice print the 0:08:34.160 --> 0:08:37.480 other day, So I think you can be somewhat optimistic now, 0:08:37.520 --> 0:08:40.679 whereas I think earlier, with those three headwinds, you had 0:08:40.679 --> 0:08:41.920 to be a little bit more cautious. 0:08:42.480 --> 0:08:44.520 Do we still see the buy the mentality? 0:08:45.840 --> 0:08:49.440 Uh? You know, it's interesting, Alex. We're seeing two different 0:08:49.440 --> 0:08:53.360 camps here. The big institutional investors in the hedge funders 0:08:53.400 --> 0:08:57.800 are have been net short, and so I'm looking for 0:08:57.880 --> 0:08:59.800 some kind of a short rally it's, you know, as 0:08:59.840 --> 0:09:03.520 they finally capitulate on their short positions. But the retail 0:09:03.520 --> 0:09:05.760 investor has been really, really strong, and so I think 0:09:05.800 --> 0:09:08.400 the retail investor is sort of thinking about this differently 0:09:08.440 --> 0:09:13.040 than the big institutional investors and putting money in every 0:09:13.040 --> 0:09:15.960 time they get a chance to and that's probably, you know, 0:09:16.000 --> 0:09:17.840 the smarter move in the long run. I mean, in 0:09:17.840 --> 0:09:19.920 the short run, nobody knows what the market's going to do. 0:09:19.960 --> 0:09:21.520 But in the long run, over time, you know, you 0:09:21.520 --> 0:09:23.920 could describe this dock market in eight simple words. The 0:09:23.960 --> 0:09:27.040 advance is permanent and all declines are temporary. So we're 0:09:27.080 --> 0:09:28.600 seeing sort of two camps out there. 0:09:29.240 --> 0:09:32.640 So Sean as president Pacer ETFs, where are you guys 0:09:32.640 --> 0:09:34.160 seeing fun flows? 0:09:34.200 --> 0:09:35.440 Is it different maybe this. 0:09:35.400 --> 0:09:37.520 Week versus a couple of weeks ago when we had 0:09:37.520 --> 0:09:41.000 companies pulling guidance and again real angst in the marketplace. 0:09:42.120 --> 0:09:44.360 Well, it's funny, you know, Paul. A couple of weeks ago, 0:09:44.480 --> 0:09:47.680 our volumes were insane, like three four times the average 0:09:47.720 --> 0:09:50.120 down volume on ours across the board, and so that 0:09:50.280 --> 0:09:52.200 was to me a sign of panic in the market. 0:09:52.600 --> 0:09:54.800 They've now sort of settled down. We're seeing, you know, 0:09:55.120 --> 0:09:58.520 surprisingly some good flows into international and global as you know, 0:09:59.040 --> 0:10:01.400 those markets have done better. I think our global fund 0:10:01.440 --> 0:10:03.680 is up somewhere around nine or ten percent year to date. 0:10:04.080 --> 0:10:06.120 I just looked at emerging markets the other day. It's 0:10:06.160 --> 0:10:08.760 up pretty handily as well. So we're seeing flows there 0:10:08.840 --> 0:10:12.240 we're seeing consistent flows into the cash Cow series on 0:10:12.280 --> 0:10:14.720 the value side, so you know, those are high quality 0:10:14.760 --> 0:10:18.079 stocks that generate higher return on assets and traded a discount, 0:10:18.160 --> 0:10:21.240 so that's sort of a more conservative quality play. And 0:10:21.240 --> 0:10:24.559 then we're seeing really significant flows into one of our 0:10:24.600 --> 0:10:27.800 growth ETFs that uses free cash flow margin. And then 0:10:27.840 --> 0:10:30.760 there's a little bit of sort of in the financial 0:10:30.800 --> 0:10:33.480 advisor community, there's really two camps as well, those that 0:10:33.559 --> 0:10:35.280 sort of want to tap the brakes a little bit 0:10:35.280 --> 0:10:36.920 and those that want to put their foot on the gas. 0:10:37.400 --> 0:10:39.160 For those that want to tap their brakes a little bit, 0:10:39.200 --> 0:10:42.199 we're seeing flows into some of the risk management strategies. 0:10:41.679 --> 0:10:42.080 That we have. 0:10:42.800 --> 0:10:44.640 Interesting so, I mean, guess is how you make a market? 0:10:45.000 --> 0:10:47.640 I mean you have two different directions and then and 0:10:47.640 --> 0:10:49.920 then you move around that really interesting stuff. Thank you 0:10:49.920 --> 0:10:52.760 so much, Sean Shaan O'Hair, president of Pacer ETFs, joining 0:10:52.840 --> 0:10:55.720 us about all the flows within the market. 0:10:57.400 --> 0:11:01.120 You're listening to the Bloomberg Intelligence Podcast. Catch us live 0:11:01.200 --> 0:11:04.280 weekdays at ten am Eastern on Apple Cocklay and Android 0:11:04.280 --> 0:11:07.600 Auto with the Bloomberg Business app. Listen on demand wherever 0:11:07.640 --> 0:11:10.720 you get your podcasts, or watch us live on YouTube. 0:11:11.520 --> 0:11:13.000 This is Bloomberg Intelligence Radio. 0:11:13.160 --> 0:11:15.120 We bring you all the top news and business, economics 0:11:15.160 --> 0:11:17.640 and finance through a lens of our Bloomberg Intelligence folks 0:11:17.679 --> 0:11:19.520 take over two thousand companies and one hundred and thirty 0:11:19.559 --> 0:11:21.160 industries all around the world. 0:11:21.320 --> 0:11:24.280 We're also privileged to speak to a lot of CEOs. 0:11:23.800 --> 0:11:25.720 From all around the world, and one of us joins 0:11:25.800 --> 0:11:29.520 us in the studio right now, EOS Energy Enterprise. It 0:11:29.640 --> 0:11:33.880 is a zinc powered grid scale batteries. We know we 0:11:33.960 --> 0:11:37.120 need updates to the grid. We know we need batteries 0:11:37.160 --> 0:11:39.800 and storage, and how we make them and where the 0:11:39.840 --> 0:11:43.640 supply chains are are also a key. Now this company 0:11:43.720 --> 0:11:46.760 is interesting because it has a US manufacturing plant and 0:11:47.000 --> 0:11:49.480 supply chain. Joining us now in the studio is a CEO, 0:11:49.800 --> 0:11:52.280 Joe Mastragello mass Strandgello. 0:11:52.440 --> 0:11:54.959 There we go, I got it. Welcome, It's good me 0:11:54.960 --> 0:11:56.120 withee you. 0:11:56.480 --> 0:11:58.679 So basically you're looking at a seven hundred and twenty 0:11:58.679 --> 0:12:01.280 percent increase in your stock in the last year. 0:12:02.240 --> 0:12:05.360 What is a zinc powered grid scale battery. Let's start there. 0:12:05.480 --> 0:12:09.559 Yeah, so when you think about this, think of think 0:12:09.600 --> 0:12:11.920 about the battery you see in your car. So we 0:12:12.000 --> 0:12:16.439 have a plastic enclosure that has the active materials of 0:12:16.480 --> 0:12:21.560 the battery inside of it, the zinc, so zinc, bromine 0:12:21.640 --> 0:12:24.480 based water based electrolyte base on what you're doing. You 0:12:24.480 --> 0:12:26.840 put a charge in the zinc and the bromine separate. 0:12:26.880 --> 0:12:28.880 When the charge goes in the zinc plates onto a 0:12:28.920 --> 0:12:32.960 conductive plastic, the bromine is absorbed into a carbonized felt 0:12:33.280 --> 0:12:34.800 and then you discharge it. And you can do that 0:12:34.880 --> 0:12:38.040 anywhere from two hours up to fifteen hours. It's all 0:12:38.080 --> 0:12:42.360 common core raw materials, highly flexible in its operation and 0:12:43.360 --> 0:12:45.120 at scale, is very cost competitive. 0:12:45.800 --> 0:12:47.800 All right, I'm looking you are a Puppety Trader company, 0:12:47.800 --> 0:12:49.960 and we'll set your income statement on the Bloomberg terminal 0:12:50.320 --> 0:12:52.439 twenty twenty four. You at like fifteen million of revenue. 0:12:52.520 --> 0:12:54.880 Consensus looks like the analysts are looking for a one hundred 0:12:54.920 --> 0:12:57.600 and sixty million this year, maybe four or fifty million 0:12:57.640 --> 0:12:58.440 and twenty twenty six. 0:12:59.080 --> 0:13:01.200 What are you guys doing helping your business? 0:13:01.440 --> 0:13:05.560 So we are scaling up the manufacturing of our battery modules. 0:13:05.600 --> 0:13:09.600 So basically we manufacturer battery modules that go into an enclosure. 0:13:09.640 --> 0:13:12.960 The enclosure goes out into the into the field. It's 0:13:13.080 --> 0:13:15.679 coupled with some energy source. It could be coupled direct 0:13:15.679 --> 0:13:18.320 to the grid to help with grid firming or peak shaving. 0:13:18.400 --> 0:13:21.400 It could be coupled with a power generating source wind 0:13:21.640 --> 0:13:25.360 solar or traditional fossil fuels, or could be put and 0:13:25.800 --> 0:13:30.280 a microgrid for a commercial and industrial application. The growth 0:13:30.320 --> 0:13:33.720 that you're seeing is basically taking our manufacturing process and 0:13:33.760 --> 0:13:36.840 going from a semi automated manufacturing line to a fully 0:13:36.880 --> 0:13:40.480 automated manufacturer manufacturing. So we manufacture in Turtle Creek and 0:13:40.640 --> 0:13:43.840 outside Pittsburgh, Pennsylvania, and our headquarters is in Edison, New Jersey. 0:13:43.960 --> 0:13:45.320 Edison, there you go. 0:13:45.559 --> 0:13:48.959 There is this You mentioned it's cost competitive at scale? 0:13:49.000 --> 0:13:49.800 Are you at scale? 0:13:50.120 --> 0:13:52.840 We're getting there. So we first the way we did 0:13:52.840 --> 0:13:54.120 this was we. 0:13:54.040 --> 0:13:56.640 Went in and got the assembly of the battery automated, 0:13:56.640 --> 0:14:00.000 and now we're doing our upfront parts to automate those. 0:14:00.160 --> 0:14:02.680 That gets our line to two gigawat hours a year 0:14:03.120 --> 0:14:03.679 of production. 0:14:03.800 --> 0:14:05.040 From there, you take the lines. 0:14:05.080 --> 0:14:07.480 The way we designed this was you cut and paste 0:14:07.480 --> 0:14:09.760 lines to expand capacity, and we have plans to get 0:14:09.960 --> 0:14:12.320 our Pittsburgh facility, our Turtle Creek facility up to eight 0:14:12.320 --> 0:14:13.640 gigawat hours a year in production. 0:14:14.080 --> 0:14:15.920 Who's your customer, generally. 0:14:16.200 --> 0:14:20.360 Type utility utilities, utility scale developers. We also have a 0:14:20.440 --> 0:14:23.560 large segment now that's emerging with data centers for all 0:14:23.560 --> 0:14:24.440 the energy needs they have. 0:14:25.520 --> 0:14:26.600 So we can now I get it. 0:14:26.920 --> 0:14:29.800 This is another play on the AI story. 0:14:29.880 --> 0:14:31.920 Is that the investment call out there, it's one of them, 0:14:32.200 --> 0:14:33.120 one of yes. 0:14:33.480 --> 0:14:34.960 Well, when you think, when you think about so, it 0:14:35.000 --> 0:14:37.120 took me a while to understand this, right, I'm a 0:14:37.160 --> 0:14:39.800 simple guy, right, So I always saw the hey, data 0:14:39.800 --> 0:14:41.320 centers go up and they run of the EU power. 0:14:41.320 --> 0:14:44.240 But there's a lot of fluctuations in the power demands 0:14:44.240 --> 0:14:44.640 that you have. 0:14:45.040 --> 0:14:46.400 So we help smooth those out and. 0:14:46.320 --> 0:14:48.280 We make it more efficient and give them, give them 0:14:48.360 --> 0:14:50.280 lower cost energy to run their operation. 0:14:50.200 --> 0:14:51.960 Which which is sort of the whole deal with intermitt 0:14:51.960 --> 0:14:53.520 and power. You need the batteries that go with it. 0:14:53.680 --> 0:14:55.760 You can have intermittent power, but you need the batteries 0:14:55.880 --> 0:14:59.280 or a variety. Right, Okay, So talk to me about 0:14:59.320 --> 0:15:02.640 then your costs. How are they looking? Are they coming down? 0:15:02.720 --> 0:15:05.960 When you sign contracts with customers? What does that look like? 0:15:06.000 --> 0:15:07.640 How hard is it to get to agreements? 0:15:07.840 --> 0:15:08.040 Yeah? 0:15:08.120 --> 0:15:10.480 So on the on the product cost side, you know, 0:15:10.520 --> 0:15:14.000 we designed when we designed this battery as a small startup, 0:15:14.120 --> 0:15:17.560 we only used materials that are used somewhere else. 0:15:17.560 --> 0:15:19.720 So we basically drafted. 0:15:19.360 --> 0:15:22.320 Off of other supply chains and said there's another supply chain, 0:15:22.440 --> 0:15:24.840 use that material, don't put anything custom in the battery. 0:15:24.840 --> 0:15:26.720 Because it is a small company, we can't afford it. 0:15:26.800 --> 0:15:29.040 So that allows you as you scale, the cost comes down, 0:15:29.080 --> 0:15:31.640 Like we've taken our cost down from launch of our 0:15:31.680 --> 0:15:34.600 new product. The cost is down over seventy five percent 0:15:34.680 --> 0:15:36.960 since we launched the product. When you think about on 0:15:37.000 --> 0:15:40.480 the flipping that over to like the seal side in 0:15:40.520 --> 0:15:42.840 the industry, you know, like like the miracle of flipping 0:15:42.840 --> 0:15:44.600 your light switch, there's a lot of technology and a 0:15:44.640 --> 0:15:46.920 lot of safety that goes into that. Customers want to 0:15:46.920 --> 0:15:48.840 make sure that the product works. We've gone through the 0:15:48.840 --> 0:15:52.840 process of qualifying that technology, improving that it works, and 0:15:52.880 --> 0:15:54.680 showing people where it is. So like what we're doing 0:15:54.760 --> 0:15:57.080 is we go out, we sell the product, show the 0:15:57.200 --> 0:15:59.160 use case, and when they see the use case. 0:15:59.040 --> 0:16:00.480 In the return, they wind up purchasing. 0:16:00.520 --> 0:16:03.640 Right now, our backlog in order stands above six hundred 0:16:03.680 --> 0:16:06.640 and fifty million dollars in backlog with an opportunity pipeline, 0:16:06.680 --> 0:16:07.720 that's over fifteen billion. 0:16:08.200 --> 0:16:08.480 Wow. 0:16:08.600 --> 0:16:11.200 How are you capitalizing the company this growth? 0:16:11.600 --> 0:16:15.160 So we're publicly traded. We we got an investment last 0:16:15.240 --> 0:16:20.960 year from Service Capital, very very good strategic strategic partner 0:16:21.000 --> 0:16:21.880 that's helping us grow. 0:16:22.280 --> 0:16:24.680 We have a loan from the Loan Program's. 0:16:24.240 --> 0:16:26.360 Office and the DOE which will help us expand the 0:16:26.400 --> 0:16:29.640 manufacturing in the United States. And then we're starting to 0:16:29.680 --> 0:16:31.400 get the company as we scale. And getting back to 0:16:31.440 --> 0:16:33.800 Alex's question on the cost is that you know we're 0:16:33.800 --> 0:16:36.840 going to we're targeting to fund ourselves from operations as 0:16:36.840 --> 0:16:38.880 we get into into twenty twenty six. 0:16:39.120 --> 0:16:42.360 So you've also had a Department of loan three hundred 0:16:42.360 --> 0:16:44.240 and three point five million dollars to fund some new 0:16:44.280 --> 0:16:45.920 production lines, new. 0:16:45.840 --> 0:16:49.320 Administration, different world. Is that loan still intact? 0:16:49.680 --> 0:16:52.400 It is? And look, I think, like anybody. 0:16:52.240 --> 0:16:53.720 Do confidence that will stay intact? 0:16:54.360 --> 0:16:54.640 I do? 0:16:54.680 --> 0:16:57.320 I Well, Look, I think when you look at the company, 0:16:58.040 --> 0:17:01.600 this company at fifty employees in twenty eighteen, we have 0:17:01.680 --> 0:17:05.439 over six hundred. Now we created four hundred manufacturing jobs 0:17:05.560 --> 0:17:07.960 in an area that lost a lot of manufacturing jobs. 0:17:08.119 --> 0:17:09.840 It's right down the fairway. What we want to do 0:17:10.040 --> 0:17:11.359 as a country. 0:17:11.640 --> 0:17:14.760 Is, so how do you guys, what's the future of 0:17:14.760 --> 0:17:16.640 the company just just grow internally. 0:17:16.720 --> 0:17:17.560 Is that kind of the play? 0:17:18.080 --> 0:17:18.640 Yeah? Maybe. 0:17:18.720 --> 0:17:22.199 Look, I think there's a lot of opportunities, opportunities to 0:17:22.240 --> 0:17:23.160 think a little bit bigger. 0:17:23.200 --> 0:17:24.400 The way we thought about the strategy. 0:17:24.440 --> 0:17:28.359 The company is a differentiated battery technology packaged really well 0:17:28.600 --> 0:17:31.920 with software around it to optimize operations when you think 0:17:31.960 --> 0:17:34.240 about what customers buy. There are other opportunities there, but 0:17:34.320 --> 0:17:37.399 right now we're focused on get factory one at scale, 0:17:37.480 --> 0:17:39.520 get factory two launch, and then look from there. 0:17:39.720 --> 0:17:41.800 All right, great stuff, great story, Joe, appreciate you. It's 0:17:41.840 --> 0:17:44.560 taking a few minutes coming to the studio. Joe Masta Angelo, 0:17:44.840 --> 0:17:47.720 he's the CEO of EOS Energy Enterprises, joining us here 0:17:47.720 --> 0:17:50.000 in our Bloomberg and Directive Broker studio talking about the 0:17:50.040 --> 0:17:54.200 smart battery stuff. It's chemistry. I did take chemistry, but not. 0:17:54.200 --> 0:17:56.280 Really that good at it. So that's why. 0:17:56.640 --> 0:17:59.000 Which is girt Because you like numbers, well, like. 0:17:59.240 --> 0:18:01.760 Wall Street numbers. Ok yeah, like big round numbers. You'll 0:18:01.800 --> 0:18:02.760 be a bonus of X. 0:18:03.280 --> 0:18:04.320 Okay, so that number. 0:18:04.880 --> 0:18:07.760 See I'm charging you for this option. That is why 0:18:08.119 --> 0:18:08.760