WEBVTT - Micron CEO Sanjay Mehrotra Talks Expanding Chip Production, Memory Demand

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<v Speaker 1>Bloomberg Audio Studios, Podcasts, radio News.

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<v Speaker 2>I am pleased to say I am joined now by

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<v Speaker 2>the Micron CEO President and Chairman, Sanjay Morotra. Sanjay, it's

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<v Speaker 2>so nice to see you, and thanks so much for

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<v Speaker 2>joining us here on Bloomberg Television and Radio. We are

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<v Speaker 2>here in Manassas, Virginia to mark the start of the

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<v Speaker 2>one Alpha DRAM manufacturing in the United States for one

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<v Speaker 2>of the most highly advanced and widely used memory chips.

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<v Speaker 2>I know Micron has a commitment to onshore forty percent

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<v Speaker 2>of its DRAM manufacturing. Can you just give us a

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<v Speaker 2>little bit of insight how does today help you with

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<v Speaker 2>achieving that goal.

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<v Speaker 1>So, first of all, Tyler, thank you very much for

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<v Speaker 1>having me on the show. In terms of what today means,

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<v Speaker 1>it really means, as you noted, bringing the most advanced

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<v Speaker 1>DDR for memory built with one Alpha technology, which is

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<v Speaker 1>critical for industries like automotive, aerospace, defense, industrial networking. These

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<v Speaker 1>are critical industries that powered America and by us bringing

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<v Speaker 1>this technology from Asia into now manufacturing here, it will

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<v Speaker 1>help us quadruple our production here at this site in Manassas.

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<v Speaker 1>For that DDR for memory, this is going to be

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<v Speaker 1>huge for our customers in those key sectors. Memory today

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<v Speaker 1>is absolutely key across all industries that have electronic systems,

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<v Speaker 1>and Micron is of course investing in Boise, Idaho building

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<v Speaker 1>our leading edge fab that's for leading age memory that

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<v Speaker 1>goes into smartphones, PCs, servers, and that leading edge memory

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<v Speaker 1>in Boise, Idaho will bring first wapers out middle of

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<v Speaker 1>next year and then ramp up from there on. We'll

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<v Speaker 1>have a second fab in Boise, Idaho soon to follow

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<v Speaker 1>that start first wafers by end of twenty twenty eight

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<v Speaker 1>eight there and then we have production planned for Syracuse,

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<v Speaker 1>New York area, where we will build over time a

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<v Speaker 1>mega cluster or four fabs. And you can see two

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<v Speaker 1>hundred billion dollars of investments that Micron is making here

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<v Speaker 1>in America to bring these long life cycle production that

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<v Speaker 1>will be managed here in Manassas, Virginia, along with production

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<v Speaker 1>in Boise, Idaho and Syracuse, New York, and that will

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<v Speaker 1>bring Micron's total production over the course of about next

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<v Speaker 1>ten years as we ramp up all these multiple fabs

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<v Speaker 1>to about forty percent of our production. By comparison, it

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<v Speaker 1>is about ten percent today, and all of that ten

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<v Speaker 1>percent comes from this site here in Manassas for Micron,

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<v Speaker 1>and this will totally our investments, massive investments in long

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<v Speaker 1>life cycle technology nodes as well as leading as technology

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<v Speaker 1>nodes to serve these vast markets that really surging in

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<v Speaker 1>demand driven by AI. Micron is going to be bringing

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<v Speaker 1>those investments that's semiconductive manufacturing and in the process create

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<v Speaker 1>ninety thousand new jobs here in the US as well.

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<v Speaker 2>Well. On this point of demand and how this investment

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<v Speaker 2>is seeking to help breach that growing demand, I'm wondering

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<v Speaker 2>how long do you expect the shortage of memory chips

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<v Speaker 2>to last? When can we expect an easing.

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<v Speaker 1>Of course, the demand for memory has really searched, and

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<v Speaker 1>that is because of the importance and the value and

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<v Speaker 1>the capability of memory that is really essential for all

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<v Speaker 1>advanced systems. And yes, there is a shortage, but Micron

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<v Speaker 1>is working hard to increase supply through these projects here

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<v Speaker 1>in America here in Manassas, Virginia, Boise, and New York.

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<v Speaker 1>And we see this shortage continuing beyond, well beyond twenty

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<v Speaker 1>twenty six timeframe. But the important thing is that Micron

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<v Speaker 1>is working hard with our customers working also on the

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<v Speaker 1>long term the supply agreements with our customers to really

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<v Speaker 1>ensure that they can have predictability for supply, and of

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<v Speaker 1>course Micron can have the confidence for the investments that

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<v Speaker 1>we are really committing to here for the long haul.

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<v Speaker 2>Well. Historically, memory is a cyclical business, right periods of boom,

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<v Speaker 2>periods of bus I'm wondering if a two hundred billion

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<v Speaker 2>dollar investment here in the US signals perhaps more of

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<v Speaker 2>a confidence that that demand, that high demand is going

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<v Speaker 2>to be permanent, or are their concerns here that the

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<v Speaker 2>industry could be overbuilding capacity.

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<v Speaker 1>You know, of course, what we are doing is building

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<v Speaker 1>these fabs which are very long lead time items. As

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<v Speaker 1>you can see in terms of what we are doing

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<v Speaker 1>it Boise in New York, it really takes several years

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<v Speaker 1>just to build construct the shell. How we equip that

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<v Speaker 1>shell really very much depends on our greatest assessments of

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<v Speaker 1>demand at a given time. So important thing is to

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<v Speaker 1>have that preparedness to meet the market demand, and Memory

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<v Speaker 1>has become a key enabler. It is a strategic asset

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<v Speaker 1>for our customers today. It is a strategic asset for

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<v Speaker 1>AI across consumer as well as data center industries because

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<v Speaker 1>without memory, you don't really have that intelligence that is

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<v Speaker 1>critically important for the future roadmaps that our customers have,

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<v Speaker 1>so memory is critical. Our investments, of course, will always

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<v Speaker 1>be managed with discipline. Today we are able to meet

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<v Speaker 1>the demand of our key customers only about fifty percent

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<v Speaker 1>to about two thirds in many cases, and it's really

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<v Speaker 1>important that we of course bring up this supply with

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<v Speaker 1>discipline and continue to really fuel the growing provide. Then

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<v Speaker 1>this is served the necessary demand that is ahead.

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<v Speaker 2>Where are your biggest bottlenecks right now in the supply chain?

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<v Speaker 2>And I'm wondering how labor fits into that picture, because

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<v Speaker 2>a lot of the announcement here today was about boosting

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<v Speaker 2>jobs here in the US.

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<v Speaker 1>As I mentioned earlier, I mean our investments will create

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<v Speaker 1>ninety thousand new jobs. These are high paying jobs. Of course,

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<v Speaker 1>Micron is very much focused on engaging with the communities,

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<v Speaker 1>with the colleges and universities, with really local systems in

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<v Speaker 1>order to even support and advance apprenticeships. So we are

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<v Speaker 1>very much focused on investing for the training and development

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<v Speaker 1>of the workforce across the United States, particularly in the

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<v Speaker 1>regions where Micron plans to have these fabs, and that

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<v Speaker 1>is of course an important critical priority in terms of

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<v Speaker 1>the bottleneck. In terms of bringing up the supply, of course,

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<v Speaker 1>it is the construction that is really long tent in

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<v Speaker 1>the poll and as construction happens, then it is about

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<v Speaker 1>bringing in the equipment and qualifying the lines, which also

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<v Speaker 1>takes some period of time. And that's why we see

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<v Speaker 1>that meaningful new supply in the industry doesn't really start

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<v Speaker 1>ramping until twenty twenty eight timeframe, because our Boise, Idaho

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<v Speaker 1>fab will have first wave fas out middle of next

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<v Speaker 1>year and subsequent fabs will have wafirs out later in

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<v Speaker 1>the future as well.

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<v Speaker 2>Does it advantage you to be the only American company

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<v Speaker 2>in this space working with the Trump administration in this way,

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<v Speaker 2>I'm wondering if you could shed any light on that,

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<v Speaker 2>and where does this position you against your largest competitors

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<v Speaker 2>like Samsung, Skhiex when it comes to market share.

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<v Speaker 1>I'm very proud of Micron's team, and of course very

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<v Speaker 1>proud that we are the only US memory manufacturer in

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<v Speaker 1>memory today is absolutely critical for everything electronic system So yes,

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<v Speaker 1>very proud, and of course our customers here in the

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<v Speaker 1>US very much value our investments in the US. They

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<v Speaker 1>value resilient, secure, supply chains that Micron is investing in

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<v Speaker 1>to support their future growing requirements. We are very pleased

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<v Speaker 1>with the partnership, the engagement. We are very thankful to

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<v Speaker 1>President Trump and his administration and his focus on bringing

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<v Speaker 1>leading edge manufacturing here to America to support a wide

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<v Speaker 1>range of our industries. And our partnership with the administration

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<v Speaker 1>is strong. As you saw, I mean, Secretary Lutnik as

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<v Speaker 1>well as Investor Greer made strong comments in support of

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<v Speaker 1>our investments today. We are very thankful to President Trump

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<v Speaker 1>for the support, and we are very much focused on

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<v Speaker 1>making our supply grow so that we can meet our

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<v Speaker 1>customers requirements, but have it grow in a discipline manner,

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<v Speaker 1>focusing on of course always demand and supply, of course

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<v Speaker 1>accelerating the timeline for our investments as much as possible.

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<v Speaker 2>In the final minute that I have you you mentioned

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<v Speaker 2>US Commerce Secretary Howard Lutnik, who gave remarks today. I

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<v Speaker 2>think it's fair to say that he's been pretty integral

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<v Speaker 2>in the administration's perhaps more hands on industrial policy, including

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<v Speaker 2>when it comes to taking stakes in companies. The US

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<v Speaker 2>government has done this to try to spur the kind

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<v Speaker 2>of production that Micron's doing, but I'm wondering have you

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<v Speaker 2>had any conversations with the administration about that.

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<v Speaker 1>Our discussions with that Mistationian are always focused on bringing

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<v Speaker 1>up supply.

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<v Speaker 2>You know.

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<v Speaker 1>The President Trump as well as Secretary Lutnik are always

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<v Speaker 1>focused on how do we go bigger, how do we

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<v Speaker 1>go faster, particularly you know, when the supply is tight.

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<v Speaker 1>And Micron is a technology leader today, we had a

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<v Speaker 1>global technology leader today. Our dram as well as nan

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<v Speaker 1>technology are most advanced ahead of others in the industry.

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<v Speaker 1>Leveraging that technology leadership and building the future of America

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<v Speaker 1>with large scale manufacturing is absolutely a priority of President Trump,

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<v Speaker 1>Secretary Lutnik, and our discussions with the administration.

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<v Speaker 2>All Right, Sanjay Morocha, the CEO of Micron, also the

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<v Speaker 2>president and chair, thank you so much for joining us

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<v Speaker 2>here live on Bloomberg Television and Radio.