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Tesla Broadcasts Downbeat Car Sales Estimates in Unusual Move · Bloomberg Intelligence

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  Speaker 1: Bloomberg Audio Studios, podcasts, radio news. You're listening to the
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  Speaker 1: Bloomberg Intelligence Podcast. Catch us live weekdays at ten am
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• 0:21
  Speaker 1: or watch us live on YouTube.
• 0:24
  Speaker 2: Craig Trudell joins us.
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  Speaker 3: Now our global autos are because Tesla, which I'm sure
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  Speaker 3: Tesla will be at CS inactive there and probably has
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  Speaker 3: been for well a decade and a half now, is
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  Speaker 3: expected to deliver a lackluster number of cars. But I
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  Speaker 3: don't know how much it matters at a one and
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  Speaker 3: a half trillion dollar valuation, Craig. I'm guessing they could
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  Speaker 3: deliver no cars and it wouldn't make much of a difference.
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  Speaker 4: Yeah, it's been fascinating to watch because, I mean, just
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  Speaker 4: in keeping with this AI theme, you know, on one hand,
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  Speaker 4: Tesla has had this hugely you know, active run of
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  Speaker 4: late with you know, selling investors on the notion that,
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  Speaker 4: you know, speaking of AI, their vehicles are going to
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  Speaker 4: be able to drive themselves. On the other hand, you've
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  Speaker 4: seen Wall Street sort of get more and more comfortable
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  Speaker 4: with the idea that people aren't actually you know, all
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  Speaker 4: that inclined to go out and buy their their cars.
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  Speaker 4: And you know, on one hand, you would you would
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  Speaker 4: think that that, you know, vehicle sales would kind of
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  Speaker 4: move in at least some correlation with the optimism about
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  Speaker 4: the self driving capability that Musk has been promising for years.
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  Speaker 4: And yet we've seen a sort of divergence here. Particularly,
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  Speaker 4: I would say, you know, in the in the second
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  Speaker 4: half of last year where the stock really took off.
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  Speaker 4: To the company's credit, they did have a great third quarter,
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  Speaker 4: but everyone saw coming that there was going to be
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  Speaker 4: a big payback in the fourth quarter once once tax
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  Speaker 4: credits in the US faded away.
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  Speaker 2: So, Craig, that's kind of where I wanted to go.
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  Speaker 5: I'd love to get your opinion as we finished out
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  Speaker 5: twenty twenty five.
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  Speaker 2: Where is the industry?
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  Speaker 5: I'm fucking the vult wagons, the general motors, the tessels
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  Speaker 5: in this transition to evs.
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  Speaker 2: Are we stalled? Here? Are we stalled on hybrids? Are
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  Speaker 2: we about to just reload and re accelerate? Where are
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  Speaker 2: we here?
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  Speaker 4: It's it's really a messy picture because you do have
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  Speaker 4: a situation where Chinese manufacturers buy and large are are
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  Speaker 4: having much less of an issue selling electric vehicles than
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  Speaker 4: the rest of the world. You're seeing incumbents elsewhere in Europe,
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  Speaker 4: uh and and particularly in the US really struggle to
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  Speaker 4: to you know, make up lost ground, uh you know,
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  Speaker 4: to the likes of Tesla, even as Musk has come
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  Speaker 4: back to them a little bit. But particularly with with
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  Speaker 4: those Chinese companies like b y d uh lately gi
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  Speaker 4: Lee as well, having quite a bit of momentum. Uh.
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  Speaker 4: And we've we've seen you know, policymakers sort of answer
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  Speaker 4: to this and sort of bow to this reality. Just
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  Speaker 4: in the last few weeks where you know, in Europe
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  Speaker 4: you saw some softening of plans for twenty thirty five
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  Speaker 4: to effectively phase out combustion engine vehicle sales. And you know,
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  Speaker 4: in US we saw you know, a really dramatic move
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  Speaker 4: out of Ford for them to you know, sort of
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  Speaker 4: put out there that they expect to take almost twenty
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  Speaker 4: billion dollars worth of charges tied to unwinding all of
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  Speaker 4: you know, these ev projects, getting rid of the F one,
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  Speaker 4: fifty lightning. It's really a messy picture for the rest
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  Speaker 4: of the industry.
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  Speaker 3: Paul loved the F one, He loved the I mean,
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  Speaker 3: I loved it too, but I got to say, I
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  Speaker 3: feel like the GMC Sierra, which they're going to keep making,
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  Speaker 3: is an incredibly solid project.
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  Speaker 2: The Silverado as well.
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  Speaker 3: Therein lies the difference between US electric vehicles and Chinese
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  Speaker 3: electric vehicles, Like I guess there are two, right, Craig.
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  Speaker 3: The Chinese subsidize this industry to the tune of hundreds
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  Speaker 3: of billions of dollars, whereas the US administration is positioned
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  Speaker 3: firmly against EV's And you know, you're paying six figures
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  Speaker 3: for an electric vehicle. If I could buy one now,
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  Speaker 3: I would buy a Portia tie Can or maybe the
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  Speaker 3: Sierra or maybe a Cayenne, you know, And in China
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  Speaker 3: you're going to pay more like twenty thousand dollars for
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  Speaker 3: an electric vehicle.
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  Speaker 2: Yeah, I think, you.
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  Speaker 4: Know, to the credit of you know, these Chinese manufacturers,
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  Speaker 4: you have seen a company like by D try to
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  Speaker 4: have you know, a little a bit of a cake
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  Speaker 4: and eat it too situation where to your point, absolutely
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  Speaker 4: they sell a heck of a lot of really really
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  Speaker 4: cheap electric vehicles. They are also trying to go up
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  Speaker 4: market and sell you know, it's sort of position actually,
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  Speaker 4: you know, relatively new sub brands of vehicles that are
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  Speaker 4: performance cars. I don't think they're you know, by any
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  Speaker 4: means moving those in the sorts of volumes that you know,
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  Speaker 4: are in any sort of comparison to what they do,
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  Speaker 4: you know, on the lower end. But that being said, absolutely,
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  Speaker 4: the level of commitment that we've seen out of China
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  Speaker 4: to this project, we haven't seen, you know, from one
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  Speaker 4: administration to the next, these wild swings in sort of approach.
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  Speaker 4: We absolutely have seen that.
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  Speaker 2: Stay with us. More from Bloomberg Intelligence coming up after this.
• 5:12
  Speaker 1: You're listening to the Bloomberg Intelligence podcast. Catch us live
• 5:16
  Speaker 1: weekdays at ten am Eastern on Apple, Cocklay and Android
• 5:19
  Speaker 1: Auto with the Bloomberg Business app. Listen on demand wherever
• 5:22
  Speaker 1: you get your podcasts, or watch us live on YouTube.
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  Speaker 3: Ford Motor Company with probably the news of the year
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  Speaker 3: from an American automaker, twenty billion dollar write down. It's
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  Speaker 3: just absolutely massive, especially if you add it on to
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  Speaker 3: the billions of dollars in write downs they've already taken
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  Speaker 3: on the EV business. Let's bring in Aaron Kating right now,
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  Speaker 3: Cox Automotive. She has been covering this industry for years
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  Speaker 3: and has been a guest on my podcast Oh Bloomberg
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  Speaker 3: hot pursuit we start it, Aaron, what do you think
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  Speaker 3: about the move by Ford, because they have been really
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  Speaker 3: spectacularly unsuccessful with evs. At the same time, General Motors
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  Speaker 3: has I can't even count how many. They've got the Hummer,
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  Speaker 3: They've got the Sierra, the Silverado, They've got the Chevy Bolt,
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  Speaker 3: They've got the Equinox, They've got the Chevy Blazer, They've
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  Speaker 3: got all the Cadillac evs. Like the list goes on
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  Speaker 3: and on and on such an incredibly broad offering. Are
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  Speaker 3: they losing the same amount of money as Ford was
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  Speaker 3: on their Lightning and mock e Well, first of all.
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  Speaker 6: It's always great to see you, Matt.
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  Speaker 7: Thank you for having me hypop As you can tell,
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  Speaker 7: I'm one of the sufferers of the cold and illness that.
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  Speaker 6: Came through the holidays.
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  Speaker 7: But yes, I mean GM does have the breadth and
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  Speaker 7: depth of the EV lineup, so they've been able to
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  Speaker 7: diversify the costs across a pretty broad set.
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  Speaker 6: Of vehicles that are available on the market. So sure.
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  Speaker 7: They've also noted that they've taken some hits from having
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  Speaker 7: to build out their electrified portfolio, but.
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  Speaker 6: Certainly not anything on the level.
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  Speaker 7: Of what Ford has had to do because they've had
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  Speaker 7: such limited vehicles that have been available, whether it's the
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  Speaker 7: Machi or the Ford F one five fifty Lightning, and
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  Speaker 7: the Lightning honestly just didn't do as well as they
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  Speaker 7: expected it to do.
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  Speaker 6: And so, you know, as they say, even when.
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  Speaker 7: We're talking about teriffs, the more product you have to
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  Speaker 7: spread that cost across, you know, the better you're off
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  Speaker 7: you're going to be moving into the future. And GMS
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  Speaker 7: seem to have nailed it as far as having some
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  Speaker 7: models that were really attractive to people at good price points.
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  Speaker 2: That's where I wanted to go erin affordability.
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  Speaker 5: Some of the numbers we hear out there on the
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  Speaker 5: average cost of a new car just staggering for most people.
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  Speaker 5: What can the industry do, if anything, to address that
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  Speaker 5: affordability issue?
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  Speaker 6: I mean, honestly, here's the deal.
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  Speaker 7: We talked about this a little bit in our fourth
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  Speaker 7: quarter call the Cars. You know, the price of vehicles, Yes,
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  Speaker 7: they've gone up, and we really experienced that huge spike
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  Speaker 7: during the pandemic which kind of level set us at
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  Speaker 7: this new call it average transaction price of fifty thousand
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  Speaker 7: dollars per car. But we are seeing people generally buy
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  Speaker 7: more expensive vehicles, the bigger vehicles. So somewhat of this
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  Speaker 7: is consumer choice. They're preferring the larger and more expensive vehicles.
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  Speaker 7: And a big story is the interest rates. I mean,
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  Speaker 7: this is a no brainer. We we've nearly come back
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  Speaker 7: to what about thirty six weeks of income at costs
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  Speaker 7: to purchase the car. Now, back in twenty thirteen, that
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  Speaker 7: was thirty three weeks of income. But what's really changed
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  Speaker 7: over all of these years is that the interest rate
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  Speaker 7: has doubled, and so that people are extending their loans.
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  Speaker 7: You know, they're getting we've heard the hundred month loan now,
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  Speaker 7: so they're not paying less, they're paying longer, and in
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  Speaker 7: fact they're paying more in interest over time.
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  Speaker 6: But the automotive companies, I think.
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  Speaker 7: You know how Ford's talking about, how they're trying to
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  Speaker 7: watch their costs, make better decisions on more profitable models.
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  Speaker 6: That's going to help them to at.
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  Speaker 7: Least keep costs down or at least stabilize so that
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  Speaker 7: pricing won't continue to go on some sort.
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  Speaker 6: Of stratospheric rise.
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  Speaker 7: But we are going to continue to see normal inflationary
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  Speaker 7: pressures on cars, just like we see on any other
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  Speaker 7: consumer good by.
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  Speaker 3: The way, reminds me I was in a I wasn't
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  Speaker 3: a Dodge dealer last week getting some new shoes on
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  Speaker 3: my Dodge Challenger scat pack wide body.
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  Speaker 2: Of course, how's how's that doing?
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  Speaker 3: The naturally appure he and I saw that they were
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  Speaker 3: offering zero percent APR and a thirty six month financing
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  Speaker 3: for their for their trucks.
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  Speaker 2: Obviously that's going to be a high payment for the
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  Speaker 2: short duration.
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  Speaker 3: But are you seeing aaron more companies, car makers, finance
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  Speaker 3: arms eat it for the consumer to give them lower
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  Speaker 3: interest rates.
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  Speaker 7: To be fair, I think most of those finance deals
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  Speaker 7: are coming in for the well healed consumers.
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  Speaker 6: I mean, this is the other thing that.
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  Speaker 7: We talk about in the automotive market is the bifurcated market, right,
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  Speaker 7: So it's usually the higher inclement individuals that are actually
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  Speaker 7: feeding our new vehicle market in the first place, and
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  Speaker 7: those are the individuals that are going to have better
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  Speaker 7: credit ratings and are likely getting a lot more of
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  Speaker 7: those deals. So would I say that the financial arms
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  Speaker 7: are eating it. They were certainly when it came to
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  Speaker 7: electric vehicles. I think that they're likely finding mostly well
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  Speaker 7: healed consumers that are able to take advantage of those
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  Speaker 7: types of deals, and we're still seeing the lower income
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  Speaker 7: quintile just stay out of the new vehicle market head
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  Speaker 7: towards the used vehicle market as they traditionally have, and
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  Speaker 7: I think we're seeing we're just eating into some more
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  Speaker 7: of those customers who may have had a chance in
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  Speaker 7: the past to enter that new vehicle market are just
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  Speaker 7: having to shop down into used vehicles.
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  Speaker 3: By the way, my sense I saw there a ram
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  Speaker 3: with with the big hemy that's coming back, thank goodness.
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  Speaker 3: And Ford, you know they have this Blue Oval City
• 10:24
  Speaker 3: or where they call it in Tennessee. They were going
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  Speaker 3: to build their next electric truck there. Now I'm guessing
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  Speaker 3: it's going to be a steel bodied Ford Classic with
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  Speaker 3: the big six point two liter VA. Bring that back,
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  Speaker 3: Bring that back? Maybe a stick shift? Do you what
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  Speaker 3: do you expect.
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  Speaker 7: When we love a stick shift? We talk about this
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  Speaker 7: all the time. Matt, Your knowledge of cars always amazes me.
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  Speaker 7: I do think that they're going to continue to look at, yes, absolutely,
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  Speaker 7: what has sold in the past, what continues to be
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  Speaker 7: popular with the American consumer.
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  Speaker 6: How do they maintain their base.
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  Speaker 7: I think the big question for the future is just
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  Speaker 7: going to be where are we losing those entry level
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  Speaker 7: customers and will that be hurting us.
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  Speaker 6: In a few years from now? Won't hurt us now?
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  Speaker 7: Where you still have the consumers be able to get
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  Speaker 7: into the market and the cars that they like, or
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  Speaker 7: I should say vehicles, because we really have very few cars.
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  Speaker 7: But are some of the automakers starting to work their
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  Speaker 7: way out of that entry level vehicle in the future.
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  Speaker 2: Stay with us. More from Bloomberg Intelligence coming up after this.
• 11:21
  Speaker 1: You're listening to the Bloomberg Intelligence podcast. Catch us live
• 11:24
  Speaker 1: weekdays at ten am Eastern on Apple, Cocklay and Android
• 11:27
  Speaker 1: Auto with the Bloomberg Business app. Listen on demand wherever
• 11:31
  Speaker 1: you get your podcasts, or watch us live on YouTube.
• 11:35
  Speaker 3: Let's stick with energy, but get into nuclear because AI
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  Speaker 3: data centers have been driving obviously a surge in demand
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  Speaker 3: for power, and Centrist Energy says it's expanding its uranium
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  Speaker 3: enrichment manufacturing in the great State of Ohio, calling it
• 11:51
  Speaker 3: a consequential transformation. We have the CEO of Centrist joining
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  Speaker 3: us now, Amir Wexler. So, Amir, first off, tell us
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  Speaker 3: big picture, sure you know, like Dan Ives always says,
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  Speaker 3: demand for AI is twelve to one compared to the
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  Speaker 3: amounts of chips out there. I'm not sure exactly what
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  Speaker 3: he means, but what about demand for power? How how
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  Speaker 3: high is it compared to what we what we can supply.
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  Speaker 2: Now, well, good morning everyone.
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  Speaker 8: Yeah, so we we from our perspective. For those of
• 12:20
  Speaker 8: you are not familiar with with Centrist, Centrist is uh
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  Speaker 8: a uranium and Richmond company. Most of the nuclear reactors
• 12:28
  Speaker 8: in the world require uranium and Richmond. We are the
• 12:31
  Speaker 8: only American technology, American owned company, and we're the only
• 12:36
  Speaker 8: ones that are not majority state owned. To your question
• 12:40
  Speaker 8: about energy, it has been really quite fascinating to watch
• 12:44
  Speaker 8: what has happened in the past year. The demand has
• 12:48
  Speaker 8: been has been hugely associated with the I. But let's
• 12:51
  Speaker 8: not forget the demand out there for nuclear fuel and
• 12:56
  Speaker 8: what we're dealing with. You know, for US AI is
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  Speaker 8: just a top I mean, we have a base case
• 13:02
  Speaker 8: assumption that really majority of it does not include AI growth.
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  Speaker 8: I mean, we're seeing a lot of commercial nuclear growth,
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  Speaker 8: and we're seeing a lot of growth in national security
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  Speaker 8: in the United States and a lot of demand for
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  Speaker 8: enrichment of uranium.
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  Speaker 2: For that I Meir.
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  Speaker 5: President Trump signed an executive order in May calling for
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  Speaker 5: the us to speed up production of enriched uranium.
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  Speaker 2: Are you seeing that practically in the marketplace these days?
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  Speaker 2: Is that impacting your business?
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  Speaker 1: Oh?
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  Speaker 8: Absolutely? I think one of the best things that happened
• 13:34
  Speaker 8: to us in the recent history is the focus that
• 13:36
  Speaker 8: the President in fact, that's put on the uranium and
• 13:40
  Speaker 8: Richmond side of the fuel cycle. It is the largest
• 13:44
  Speaker 8: constraint in my view, in the entire fuel cycle and
• 13:47
  Speaker 8: the ability to power the existing reactors and the future reactors.
• 13:52
  Speaker 8: And so absolutely we see a lot of activity, so
• 13:55
  Speaker 8: much so in that we have announced a few weeks
• 13:57
  Speaker 8: ago that we are commencing the construction fabrication of uranium
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  Speaker 8: centrifuges in our facility in Ohio. And by the way,
• 14:06
  Speaker 8: we sort in in oak Ridge, Tennessee. By the way,
• 14:09
  Speaker 8: we we're headquartered in Bethesda, and we operate uh two plants,
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  Speaker 8: one in Tennessee and one in Ohio where the enrichment
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  Speaker 8: is done. I'm here for the holidays in Toronto, so
• 14:18
  Speaker 8: you see the beautiful skyline of Toronto right behind me.
• 14:20
  Speaker 8: But but we are, uh, you know, based out of
• 14:23
  Speaker 8: out of Bethesda and in the United States.
• 14:26
  Speaker 2: Uh, why why choose my home state of Ohio? You're
• 14:30
  Speaker 2: located right there.
• 14:31
  Speaker 3: Look, if I'm driving from Columbus past Chili Coffee down
• 14:35
  Speaker 3: to Ashland, you're right in the middle there.
• 14:36
  Speaker 2: In pikedon why why did you choose that location?
• 14:39
  Speaker 8: We we we go, we go way back in that
• 14:42
  Speaker 8: in that facility. Uh, that facility was originally constructed for
• 14:48
  Speaker 8: a demonstration program of some of the centrifuges that we
• 14:51
  Speaker 8: worked on with the Department of Energy. I mean, the
• 14:55
  Speaker 8: the ability of somebody to get into the uranium business,
• 14:58
  Speaker 8: the uranium and Richmond business, the barriers to entry is
• 15:01
  Speaker 8: almost insurmountable. So I mean, that's a great question. I mean,
• 15:05
  Speaker 8: we've been working on our technology for decades in collaboration
• 15:09
  Speaker 8: with the Department of Energy, and that was one of
• 15:13
  Speaker 8: the original facilities where we have installed some of our
• 15:16
  Speaker 8: demo cascades and centrifuges. In the past two years, we
• 15:21
  Speaker 8: have built a demo cascade that has been producing HALU,
• 15:25
  Speaker 8: which is a high assay low enriched uranium. It's a
• 15:28
  Speaker 8: slightly more enriched uranium that is meant to power advanced reactors.
• 15:33
  Speaker 8: And that's where we've been operating that cascade from. That's
• 15:36
  Speaker 8: where we've been enriching it from. So our huge buildout
• 15:39
  Speaker 8: is going to happen in that facility. I'm not sure
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  Speaker 8: I can exactly answer why Ohio was picked for that,
• 15:46
  Speaker 8: but we love the area.
• 15:47
  Speaker 2: We have some real talent in that.
• 15:49
  Speaker 8: Area, and we're able to attract some real talent in
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  Speaker 8: Tennessee as well.
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  Speaker 3: I mean, I was just wondering if I was just
• 15:54
  Speaker 3: wondering if the Siota River has anything to do with it,
• 15:56
  Speaker 3: because it runs right through piked in there.
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  Speaker 2: That's a good question.
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  Speaker 8: I may have to consult with some of the historians
• 16:02
  Speaker 8: in the company.
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  Speaker 5: Hey, Imir, one technology that's got my attention here as
• 16:07
  Speaker 5: we think about powering this AI revolution is small modular
• 16:12
  Speaker 5: reactors small nuclear reactors. Talk to us about that technology
• 16:15
  Speaker 5: and what do you think of it?
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  Speaker 8: My personal opinion is it is exciting. I think it's fantastic.
• 16:23
  Speaker 8: There's a lot of companies here in the United States
• 16:25
  Speaker 8: that are developing really exciting new technologies to make the
• 16:29
  Speaker 8: reactors more efficient, more productive, safer. My personal opinion is
• 16:36
  Speaker 8: is it really does not matter to centris centrists is
• 16:40
  Speaker 8: obviously cheering everybody on. We want large reactors to win,
• 16:43
  Speaker 8: we want small reactors to win, we want advanced reactors
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  Speaker 8: to win. But at the end of the day, the
• 16:48
  Speaker 8: enrichment will be required for that growth, you know. Maybe
• 16:53
  Speaker 8: more specifically to your question, I mean, I would love
• 16:56
  Speaker 8: to see a world where we have a real balanced
• 16:58
  Speaker 8: build out of large reactors. And I think you heard
• 17:02
  Speaker 8: President Trump announced that there's going to be built out
• 17:05
  Speaker 8: of the Westinghouse AP one thousands, and we're also hearing
• 17:09
  Speaker 8: that there's quite a few advanced reactors, small modular reactor
• 17:13
  Speaker 8: companies that are very close to demonstrating their capability and
• 17:17
  Speaker 8: being able to start putting power on the grid and
• 17:19
  Speaker 8: not too long from now. So my personal view is
• 17:21
  Speaker 8: it's exciting where it comes from. It matters not to centrist.
• 17:25
  Speaker 8: We're cheering everybody on.
• 17:27
  Speaker 3: I mean, what about transportation. I'm just curious about the logistics.
• 17:31
  Speaker 3: I'm sure you don't put it in the back of
• 17:33
  Speaker 3: an F one fifty and truck it off to three
• 17:35
  Speaker 3: mile Island.
• 17:36
  Speaker 2: So how do you move enriched uranium around?
• 17:40
  Speaker 8: Yeah, so it depends on what state the enriched uranium
• 17:44
  Speaker 8: is in. Typically, post enrichment activities, it is in the
• 17:49
  Speaker 8: uranium hexafluoride state, which is sort of like a gaseous form,
• 17:54
  Speaker 8: and this is so tightly regulated by the NRC and
• 17:58
  Speaker 8: the DOT. There are licensed containers that are designed and
• 18:02
  Speaker 8: have been tested in a series of stress tests to
• 18:06
  Speaker 8: make sure that all transportation of uranium is done safely
• 18:11
  Speaker 8: and the public is protected. And quite honestly, this the
• 18:14
  Speaker 8: transportation is very standard. It's been happening for decades and
• 18:17
  Speaker 8: decades now, and it's been happening in Maritimes. It's been
• 18:21
  Speaker 8: happening on the roads and highways and on rails. It's
• 18:25
  Speaker 8: a licensed activity and there's licensed containers that have been
• 18:28
  Speaker 8: tested and stress tested for that.
• 18:30
  Speaker 2: Stay with us. More from Bloomberg Intelligence coming up after this.
• 18:37
  Speaker 1: You're listening to the Bloomberg Intelligence podcast. Catch us Live
• 18:41
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• 18:44
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• 18:47
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• 18:51
  Speaker 3: Let's talk now about one of the biggest deals of
• 18:55
  Speaker 3: twenty twenty five, or.
• 18:56
  Speaker 2: At least I guess agreed to.
• 18:59
  Speaker 3: Deal hasn't been closed obviously yet, and that's the battle
• 19:02
  Speaker 3: over Warner Brothers. Paul, this is the one you've follow
• 19:04
  Speaker 3: in closes. Have you, by the way, have you bought
• 19:06
  Speaker 3: or sold Warner Brothers yourself.
• 19:08
  Speaker 5: I did with AOL paper back in two thousand, two
• 19:10
  Speaker 5: thousand and one.
• 19:11
  Speaker 3: I knew you'd been involved in that. And I love
• 19:14
  Speaker 3: this deal also because it's one that President Trump had
• 19:20
  Speaker 3: previously killed. Remember when AT and T wanted to buy
• 19:23
  Speaker 3: Warner Brothers, he's got an interest in and now it
• 19:25
  Speaker 3: appears he said no, the DOJ. They sued, They sued
• 19:28
  Speaker 3: the DOJ and they actually got it done. But then
• 19:31
  Speaker 3: then AT and T was like, wait, this was a
• 19:33
  Speaker 3: bad idea. So then they got rid of it and
• 19:35
  Speaker 3: now it's up for grabs again Netflix.
• 19:38
  Speaker 2: That was the agreed deal to.
• 19:40
  Speaker 3: Buy Warner Brothers, paramount, of course, in with the with
• 19:44
  Speaker 3: the hostel offer. So let's talk about how this works out,
• 19:47
  Speaker 3: how it changes the media landscape, the future of streaming,
• 19:50
  Speaker 3: bundling movies, et cetera.
• 19:52
  Speaker 2: Paul Larby joins us to break it down. He's the
• 19:54
  Speaker 2: CEO of Bango.
• 19:55
  Speaker 3: Bango is a global tech company that enables providers to
• 19:58
  Speaker 3: reach more paying custo sumers through global partnerships.
• 20:01
  Speaker 2: I guess that's corporate speak.
• 20:03
  Speaker 3: I looked on the website and I guess I could
• 20:05
  Speaker 3: just Paul tell me about this. I could go to
• 20:08
  Speaker 3: you and say I want this, that and the other
• 20:11
  Speaker 3: streaming service, you bundle it for me and I just
• 20:13
  Speaker 3: pay you.
• 20:14
  Speaker 9: Yeah, not directly through us. I mean, in fact, we
• 20:16
  Speaker 9: enable other brands to do that. So if you're a
• 20:18
  Speaker 9: Verizon customer, for example, and you're getting Netflix and hboor
• 20:21
  Speaker 9: Max together as part of a package, where the technology
• 20:24
  Speaker 9: that provides that. So we enable anybody who as a
• 20:25
  Speaker 9: subscription service like Netflix or even through to AI based
• 20:28
  Speaker 9: services to basically resell it through a channel and where
• 20:31
  Speaker 9: our product for that is called the digital vending machine,
• 20:33
  Speaker 9: and so where that technology partner that sits in the middle.
• 20:35
  Speaker 9: So most people will be using us, but without actually
• 20:37
  Speaker 9: having heard of who we are, Paul, what.
• 20:40
  Speaker 5: What are people like yourselves in the industry, in the
• 20:43
  Speaker 5: media industry, in the streaming business.
• 20:46
  Speaker 2: How are you guys.
• 20:46
  Speaker 5: Viewing this Warner Brothers potential deal going on out there?
• 20:51
  Speaker 9: Yeah, I think it's really interesting. I think there's certainly
• 20:53
  Speaker 9: the streaming landscape. Potentially this brings together the first and
• 20:56
  Speaker 9: the fourth largest sort of streaming services, and that can
• 20:58
  Speaker 9: zone quite dominating. Actually if you look at the number
• 21:01
  Speaker 9: of streaming services we have. It actually potentially solves a
• 21:04
  Speaker 9: customer and you know, something like thirty percent of people
• 21:07
  Speaker 9: have four more different video streaming services, and if you
• 21:11
  Speaker 9: watch sports then you probably have five or six because
• 21:13
  Speaker 9: those tend to be more spread across different services. And
• 21:16
  Speaker 9: all our Bangal data shows that customers are crying out
• 21:19
  Speaker 9: for simplification and consolidation, and that's sort of what we've
• 21:22
  Speaker 9: been doing. So it's always bringing these two together makes
• 21:24
  Speaker 9: a lot of sense for a consumer perspective. I think
• 21:26
  Speaker 9: it needs to sort of big put in perspective, Right,
• 21:29
  Speaker 9: we're bringing these two together. The question is sort of
• 21:31
  Speaker 9: what follows after that, because I I think the last
• 21:33
  Speaker 9: thing we want to do is recreate and if that
• 21:35
  Speaker 9: what Netflix disrupted, which was that big cable TV package,
• 21:38
  Speaker 9: So you don't want to end up with one streaming
• 21:39
  Speaker 9: services that is so expensive. It just looks like the
• 21:42
  Speaker 9: cable packages used to look like sort of five or
• 21:44
  Speaker 9: ten years ago.
• 21:45
  Speaker 3: By the way, if you were Paul in charge of
• 21:47
  Speaker 3: the FTC and you had to look at the streaming universe,
• 21:51
  Speaker 3: obviously Netflix and HBO and Prime are in there, would
• 21:56
  Speaker 3: you also include YouTube and Instagram and what's the one TikTok?
• 22:02
  Speaker 3: Would would you include all those as well?
• 22:05
  Speaker 5: Yeah?
• 22:06
  Speaker 9: For sure, And I think the media landscape is traditionally evolving,
• 22:08
  Speaker 9: and we've talked about things like that, you know, the
• 22:11
  Speaker 9: death of sort of live TV for some for some
• 22:13
  Speaker 9: time now, and life TV has really become now to
• 22:15
  Speaker 9: a point where it's sort of news, big social events
• 22:18
  Speaker 9: where maybe there's a voting element something like you know,
• 22:20
  Speaker 9: the the oscars of the Golden Globe Awards or sport,
• 22:23
  Speaker 9: and really it's sort of really live TV sort of
• 22:25
  Speaker 9: relegated down to those and the people that have really
• 22:27
  Speaker 9: will survive in this media landscape are the people that
• 22:29
  Speaker 9: embrace these sort of changes. And likewise, we've seen the
• 22:32
  Speaker 9: evolution of sort of short form content that can sit
• 22:35
  Speaker 9: alongside some of the more well produced longer form sort
• 22:38
  Speaker 9: of content. So the companies are going to survive in
• 22:41
  Speaker 9: this really are all sort of coming together. And it's
• 22:43
  Speaker 9: really the innovative ones that have adopt the live events
• 22:47
  Speaker 9: that make sense, the short phone content alongside the more
• 22:49
  Speaker 9: traditional video onto tim you know, content that are bits
• 22:52
  Speaker 9: of the companies that will ultimately survive and be successful.
• 22:55
  Speaker 9: And I think that's where Netflix has gone sort of
• 22:57
  Speaker 9: great innovation in sort of bringing all these different elements together.
• 23:00
  Speaker 3: Do you worry Paul about movie theaters all going broke
• 23:03
  Speaker 3: because everything gets streamed and kids just consume content on
• 23:08
  Speaker 3: their tiny little screens in their bedrooms with the door
• 23:11
  Speaker 3: double locks, so mom and dad don't come in.
• 23:13
  Speaker 9: I mean, what about the big screen? Yeah, I know,
• 23:18
  Speaker 9: I think that's an interesting, interesting thing. And Netflix historically
• 23:20
  Speaker 9: have gone for sort of more niche or limited cinema
• 23:23
  Speaker 9: releases to get sort of prestige or to qualify for
• 23:27
  Speaker 9: sort of awards. I know they've committed to extending and
• 23:29
  Speaker 9: not taking all of the new content. He should the
• 23:32
  Speaker 9: acquisition be successful directly to streaming and still preserving those
• 23:35
  Speaker 9: theatrical releases. But I think actually the theatrical industry has
• 23:38
  Speaker 9: to sort of reinvent itself. It has to create more
• 23:39
  Speaker 9: of an experience, not just be about seeing something on
• 23:43
  Speaker 9: a slightly bigger screen in a slightly different seat. It
• 23:45
  Speaker 9: needs to it needs to reinvent itself and create that experience.
• 23:47
  Speaker 9: And I think if it does that, they'll always be
• 23:49
  Speaker 9: a place for it. Right, it's a very it's much
• 23:51
  Speaker 9: more of a social element, and so I think it's
• 23:53
  Speaker 9: a case of just just in the experience.
• 23:55
  Speaker 5: Paul, let's talk about big, big time sports. I'm talking
• 23:58
  Speaker 5: NFL sports, fucking English Premier League. The stuff that really
• 24:02
  Speaker 5: moves the needle is that programming in size going to
• 24:06
  Speaker 5: move to streamers.
• 24:09
  Speaker 6: Yeah.
• 24:09
  Speaker 9: I think what we've seen is ultimately it's become fragmented,
• 24:11
  Speaker 9: so it's becoming more and more different places, right, And
• 24:13
  Speaker 9: I think that's a challenge for the consumer. And there's
• 24:16
  Speaker 9: a question of you know, if you're a if you're
• 24:17
  Speaker 9: a massive fan, how many how many of these sporting
• 24:19
  Speaker 9: services are you're willing to sign up for to see
• 24:21
  Speaker 9: the complete season? And I think we we'll get to
• 24:23
  Speaker 9: a point pretty soon where were sort of a breaking point.
• 24:25
  Speaker 9: And certainly our research has shown that if you're a
• 24:28
  Speaker 9: sports fan, you probably have an extra two or three
• 24:29
  Speaker 9: different subscription services purely to get your entire sports, whether
• 24:33
  Speaker 9: that be NFL or whether that be soccer, so just
• 24:34
  Speaker 9: so you can see the full elements. So I think
• 24:37
  Speaker 9: it actually will, you know, it actually will for sure
• 24:39
  Speaker 9: evolved to the streaming. The streaming players will be involved.
• 24:42
  Speaker 9: I think that then becomes a question of how many
• 24:44
  Speaker 9: players are really sustainable, you know, how many how many
• 24:46
  Speaker 9: people can you divide a single season between before it,
• 24:49
  Speaker 9: you know, customers just get turned off.
• 24:51
  Speaker 3: Yeah, I would think I would think sports fans are
• 24:54
  Speaker 3: just unhappy people right now because you know what, when
• 24:57
  Speaker 3: we were kids, Paul, you could watch all of the
• 24:59
  Speaker 3: great to sports on your free over the air broadcast television,
• 25:05
  Speaker 3: and now.
• 25:06
  Speaker 2: It's just impossible.
• 25:07
  Speaker 5: No, So it's uh, that's why everybody's That's why if
• 25:10
  Speaker 5: you're paramount, this is a half to do deal.
• 25:13
  Speaker 2: I it's Netflix. It's a nice deal, But if you're paramount,
• 25:16
  Speaker 2: you got to own one. What does David Zaslov do here, Paul,
• 25:19
  Speaker 2: I mean host to the Best?
• 25:20
  Speaker 3: This is the guy who I mean when he changed
• 25:22
  Speaker 3: HBO's name to Max, he looked like a chump, but
• 25:24
  Speaker 3: right now he looks like an absolute hero.
• 25:28
  Speaker 9: Yeah, you know, that was one of those brands that
• 25:30
  Speaker 9: sort of came and went, wasn't it right when we
• 25:31
  Speaker 9: were back to we're back to back to to to
• 25:33
  Speaker 9: where we started. But I think there's I think there's
• 25:35
  Speaker 9: you know, there's a great library of content there, and
• 25:38
  Speaker 9: I think having a distribution part of like Netflix, you
• 25:40
  Speaker 9: can take that content and those brands to market. I
• 25:42
  Speaker 9: think he's a really really powerful combination. It's sort of
• 25:45
  Speaker 9: creates a sort of question of what's left with the
• 25:48
  Speaker 9: kble assets that are left and what's that what's the
• 25:49
  Speaker 9: value that's that's placed on those? But I think it's
• 25:51
  Speaker 9: a it's a great out look for some some great
• 25:53
  Speaker 9: brands that we all know and love.
• 25:55
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