Morning Brew Daily - Bezos-Backed $20K EV Truck Unveiled & Shein and Temu Raising Prices?

Episode Date: April 28, 2025

Episode 570: Neal and Kyle chat about the newest EV pickup truck from Slate that some are calling the “anti-Cybertruck” with a price tag starting at $20,000. Then, retail traders who’ve been betting on the stock market dip may have outsmarted seasoned trading firms. Also, incoming tariffs have forced Shein and Temu to raise their prices. Meanwhile, Wrexham and Netflix’s new subtitles are the weekend’s winners. Finally, a preview of what’s in the week ahead.  Subscribe to Morning Brew Daily for more of the news you need to start your day. Share the show with a friend, and leave us a review on your favorite podcast app. Visit https://planetoat.com/ to learn more! Listen to Morning Brew Daily Here: https://link.chtbl.com/MBD Watch Morning Brew Daily Here: https://www.youtube.com/@MorningBrewDailyShow Learn more about your ad choices. Visit megaphone.fm/adchoices

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Good morning, Brew, Daly. show. I'm Neil Fryman. And I'm Kyle Hagee. Today, who's dumb money now? Retail investors buy the dip while hedge funds get queasy. And how this Bezos-backed Basic Truck aims to disrupt the EV market. It's Monday, April 28th. Let's ride. Good morning. Hope you all had a great weekend. It was an excellent weekend for a group of artists that were inducted into the Rock and Roll Hall of Fame as part of its class of 2025. You may have heard of these folks, Cindy Lopper, outcast. Soundgarden and the white stripes, and maybe next year's voting will be kinder

to the acts that got passed over. Fish, Oasis, and Mariah Carey are among the artists who didn't make the final cut this year. The announcement was made on live TV last night by Ryan Seagrest during American Idol. American Idol is still going on. Apparently. Like this blows my mouth.

How many seasons do they have? 23. If you had to go on American Idol, what song are you singing, Neil? Oh, my God. As if I haven't thought about this for the past quarter century. I would probably, I don't know.

I'm going complicated by Avril Levine. That's my jam. That would work. You would get the ticket to Hollywood, if they still do that. I think so. And now a word from our sponsor, Planet Oat. Neil, you ever try and convince your mom

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Tickets on sale now at Yamavatheater.com. Only at Yamava Resort and Casino. celebrating its 40th anniversary. UN must be 21 to enter. Retail investors have been frequently mocked as dumb money for letting emotions get the best of us and making ill-advised decisions when markets get bumpy. Well, maybe we're not so dumb after all

because over the past few weeks, as markets convulsed over tariffs, individual investors stayed the course even while the suits headed for the exits. Take that, Ken Griffin. Okay, here's the evidence. Vanguard estimates that more than 97% of investors in its 401k retirement plans didn't make any trades through mid-April, showing that

they didn't panic and sell everything as stocks plunged following Liberation Day tariffs. Many even bought the dip. On April 3rd, when markets plunged almost 5%, individual investors scooped up over $4.5 billion worth of stocks in ETFs, which was the strongest buying day on record, according to JP Morgan. Hedge funds, meanwhile, couldn't handle the stress. Hedge fund clients of Goldman Sachs sold more stocks on April 3rd. April 4th than any other two-day period in the last 15 years. Kyle, analysts say this marks a profound shift in the behavior of retail investors in just the past few years.

Seems they're finally listening to investing legends like Warren Buffett who preach patience and keeping a cool head even if the market gets a little bonkers. Yeah, literally, these retail investors sound exactly like Warren Buffett. Some of these quotes from this Yahoo article talking about it, you know, quote, I see this is another 2020 like buying opportunity for long-term potential. Another quote about even if it keeps going lower, buy more to lower your cost average. Ten years from now, it'll be higher. So the cheaper it gets the happier I am.

These are straight out of the Warren Buffett playbook. When stocks are low, view them as on sale, buy a ton of great companies. Now, 60% of the inflows, according to JPMorgan, are to individual stocks, Tesla and Vidia being two large ones. But 40% are going to ETF. So it sounds like the retail investor, less COVID. meme stock mania and more disciplined, buy for the long term, and hold strategy. Really interesting. Right. So investing legends, John Bogle, who started Vanguard, they say that, you know, stocks do go up over the long term. So you should have a long term investing horizon. You shouldn't

get caught up in the day-to-day swing so much, which is what individual investors were supposed to have done. Now, there are a few asteris to this, these particular data that I want to mention. And hedge funds, you know, we say they're getting a little queasy, but they're not necessarily selling their positions because they got nauseous from all of the roller coaster of the markets. Sometimes they do have to sell their positions when stocks go down just a little bit because they're buying on leverage and they have to cover collateral with their lenders. So they just might have to do it. They have no choice. It's not that they can't handle the market fluctuations. And then in terms of the individual investors, a lot more individual investors are.

plugged into the stock market through their 401k retirement accounts. Over the past few decades, there's been a dramatic shift from people getting pensions through their work, then to getting 401Ks, which are, you more actively manage those. So it looks like people are more invested in the market, but maybe that has been a good thing because people are paying attention more to the market. They're listening more to investing gurus like Bogle, like Buffett, who say, keep calm and carry on, especially during these market convulsions like we've had over the past few, That's right. It's interesting, you know, anyone under 40 years old or so, we've kind of only seen bull markets in our lives. There's maybe been a few exceptions like the financial crisis 2009. That started an 11-year rally in the market, which was one of the best buying opportunities of all time. And then COVID obviously brought the stock market down. It recovered in like a month. And that also was one of the best buying opportunities of a lifetime. And so I think a lot of young adults who are coming into money have these retirement accounts. they've only seen basically stock go up and they're continuing to hold that view.

Now it's interesting, the American Association of Individual Investors, which surveys, not just day traders, but general individual investors, does this survey where they look at the bull and the bear spread. So how many people think they expect a bull market, how many people expect a bear market? The majority have a bearish view on equities over the next six months, but it's not stopping them from continuing to plow money into the stock market. And the question now is how much are these individual investors propping up the current stock market? So we know we had that big plunge after those tariffs were announced in early April.

Well, last week, stocks were covered in a big way. The SMP 500 was up for straight days. It's cut half of its losses since its peak February 19. So that's what the question that Wall Street is trying to figure out now is where does this market go from here? Are individual investors, which collectively owned 38% of the entire U.S. stock market. We're very, very powerful. Where does that put the market as we go into this big week ahead, which we'll preview later in the show?

Yes, we are very powerful. I have news for you about a car company with the letters T-E-S-L-A, and it's not Tesla. Yes, you heard that right. I'm talking about a brand-new car company called Slate, which coincidentally is an anagram of Tesla. Slate made a splashy entrance last week by being admittedly not splashy. The new default model, an EV truck called the Blank Slate, has no paint, no stereo, no touchscreen. The selling point is that it's all the car you need and none of the car you don't.

However, you will be able to purchase accessories that allow you to transform the truck in a ton of different ways, include turning it into an SUV, enabling electric powered windows, installing surround sound speakers, changing the paint color, and more. At about 15 feet long, with a payload capacity of 1,400 pounds, it's also a lot smaller than most modern trucks. coming in at about two-thirds the size of a Chevy Silverado. But with the diminished-sized comes a diminished price tag. The blank slate will retail for about 20K after federal EV incentives. Neil, should we put $50 down now to reserve one for a 2026 delivery?

I'm loving this car. They just made the fro-yo of cars. I mean, you walk into the store. You get a little base model, and then you go to the fix-ins bar, and you can put whatever you want, and then you put it on the scale, and you're like, okay, well, that was more expensive than I thought. It's $33. But if you don't go, it's $33.

But if you don't go to the fix-ins bar and skip it and go straight to check out, then you are getting the most affordable EV on the market by far under $20,000 if these federal tax incentives continue, which is a major question. But they've completely flipped the script. Many American EV makers that have come up recently, these startups, Lucid and Rivian, have gone the total different angle in saying we're going to go after the luxury. luxury market. We're going to charge you at least $60,000. And then other legacy car makers that have pivoted to EVs are still making these cars that are upwards of $40,000. So

aiming a car that's under $20,000 with admittedly very few amenities if you don't want them is a very interesting gamble that had the whole tech world talking. Yeah, it is when they zig, we should zag. And there's a few trends I think Slate is leaning into. One is this kind of made in America trend. So the vehicles are designed in California and Michigan, engineered in Michigan, and then assembled somewhere in the Midwest. And their assembly process and their manufacturing process is so much easier because they're only making one base model. And they don't have a paint shop. And they don't have a paint shop, which is fascinating. So paint, you don't, you might not think about it, is very costly to do. Mercedes-Benz just announced that it's building a next-generation

paint shop in Germany. It's going to cost nearly $1 billion. Slate said that by not having this metal stamping presses in a paint shop, it's saving them between $350 and $500 million, which are projected on a scale of 150,000 vehicles a year. So they're getting rid of the paint. They're made in America. The other trend I think they're leaning into is this like customizable trend in this like DIY home kit advocate community where people can buy the base model, but then they can customize it in ways they want.

Although to your point, that will drive up the cost. And so it'll be interesting to see if people actually do that. We'll see because this thing is not going that many miles on a charge. It's offering two battery packs, one with the target range of 150 miles, which is much lower than, you know, traditional EVs. The Ford F150 Lightning, which is their electric truck gets upwards of 300. So you are, you're just not going to be able to go that many places without having to, you know, recharge your battery. There is a bigger battery pack, which certainly will cost you more with a target range of 240 miles. But we'll see when this thing comes off the assembly line in 2026.

It has backers, including Jeff Bezos. It's raised $111 million. I will say there's just a pretty big graveyard of failed EV companies that have gone bankrupt, that have tried to do this Made in America thing. The EV market overall has been slowing down. We know that for a fact for the past couple years. And one interesting thing that people are putting out about its launch and its marketing strategy, it doesn't really mention that it is an EV.

It's very low on the website. It's not mentioned in the hype video. They're focusing first and foremost on affordability, which may be a winning proposition in this economy. I'm very, very excited to see how this truck does. I'm going to compare it to a company that might seem a little crazy, which is crocs. They started as this very basic model, but really what blew them up in popularity was the customizable aspect. Slate also has this thing called slatelets, which are like gibbets for crox, so you can put those little decals on them. You can like pimp out your car with all these little decals.

So it's very interesting to see they're definitely, again, zinging when others are zagging. The global trade war has put a few things in its sights since quote unquote liberation day, multilateral trade agreements, currency manipulation, non-trade barriers. And now it's focused on another major target, the Sheen Hall TikTok videos. That's right. in what could be a kill shot to the Sheen Hall TikTok genre, the de minimis exemption will be removed, which has historically allowed small packages under $800 from China and Hong Kong to avoid tariffs and other duties, which have powered companies like Sheen and TEMU.

Now the products will face a 120% tariff or a flat $100 fee per postal item. Sheen and Timu announced this change to their customers saying this would increase the prices on goods, although they were vague on details about which specific products and buy how much. Zooming out, Sheen reported $38 billion in total sales in 2024, up 19%. And Timo was reportedly on track to reach 50 billion in sales in 2024. The success of these companies inspired other low-priced e-com-powered businesses like Amazon Hall and TikTok shop. Neil feels like the core value prop of Sheen was that it was cheap.

And if it isn't cheap anymore, are people still going to buy from this company? It's a great question. It's not going to be so cheap anymore. On Friday, Sheehan hiked its prices on many items, a considerable amount. The average price for the top 100 products and beauty and health category increased by 51%. Several of these items more than doubled in price. The average jump for home and kitchen products and toys was up 30%. There was a 377% increase in the price of a 10-piece set of kitchen towels. Their main value prop was these were dirt cheap and, They'll be delivered right to your door, but because of tariffs, because of the de minimis exemption, being removed on Friday. They're jacking up their price. And these are massive businesses who are now facing an existential crisis. And this kind of blew up on TikTok, not surprisingly, where people were putting in massive orders to these companies before the tariffs would hit.

And so it'll be interesting to see the consumer reaction once the prices do, maybe significantly go up. Also, just to look at the de minimis exemption, which is not something that's common. knowledge to everyone, de minimis imports have exploded from 9.2 billion in 2016 to 54.5 billion in 2023. And so the Trump administration clearly has it in its sights and we'll be removing it. Well, some would argue it has been abused. And those people would be American retailers that are seeing their businesses undercut by Sheen and Tamu. So if you're Walmart and your Amazon, yes, you're dealing with the tariff fallout yourself, but you're also probably breathing a sigh of relief

because these were your main competitors. They were cutting into your business in a very big way. And now the value prop has been totally cut off from these companies. And you're seeing their popularity dwindle already. We're already seeing this. We'll just look at the app store. Tamu used to be number three on the app store. Now it's 85, number 85 in just two weeks.

Sheehan has gone from the seventh place on the app store to 80. So it's a clear sign that consumers are, turning away from Timon Chen if they're not getting those bargain basin prices as promised. Amazon's got to get some TikTok influencers to do like Amazon Prime halls and that will skyrocketed. They did roll out this storefront that basically copied this particular model. So they are feeling the pinch, but they have other businesses that they can turn to while these two companies, which, you know, Sheen wanted to IPO in London at a massive valuation. So we'll definitely be keeping track on what's going to happen to these companies.

but I don't think this is part of the broader negotiation with China that Trump is doing right now because this is sort of a bipartisan effort that's been going on for years to remove this loophole because of these companies that are undercutting American businesses. Up next, can anyone stop Ryan Reynolds? It's time to refresh your yard during spring backyard days at the Home Depot. Get low prices guaranteed on propane grills starting at $179, like the next grill three-burner gas grill, or get $50 off a select Weber Cells. Spirit Grill and bring big flavor to your backyard.

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And my winner is Rexum because you can't write a Hollywood fairy tale better than this. The Welsh Soccer Club by Ryan Reynolds and Rob McElheny in 2021 got promoted again to the next league up after a 3-0 victory on Saturday. Rexham has gained promotion for three consecutive years now and next year we'll be playing in the championship, just one division below the A-tier Premier League. No English soccer club in the modern history of the sport has done what Rexham just did, being promoted to a better league back to back to back. Wrexham isn't just a good story. It might just be one of the best sports investments in recent memory.

Four years ago, the two Hollywood stars shocked the sports world when they bought a little-known struggling soccer team from Northern Wales for $2.5 million. Now it's worth more than $100 million after Rob and Ryan Inc. deals with global sponsors like United Airlines created a popular docu-series on Disney Plus and it probably turned Wrexham into one of the most recognizable sports brands anywhere in the world, and the money is flowing. Four years ago, Wrexham reported around $1.5 million in annual revenue. Last year, sales grew to $35.5 million, three times their peer average,

and a 155% jump in the last year alone. And because they'll play in the championship next year, with far more visibility and revenue opportunities, business will be juiced even further. Kyle, everything Ryan Reynolds touches turns... of gold. Literally, this is such a fun story. And one, I need to see a, it's always sunny in Philadelphia episode where it's like the gang buys a soccer team because this would be a perfect episode. Rob and Ryan are literally living my dream where you were like, I was in sixth grade in a basement with my friend saying, if we ever get super rich, we would buy a sports team randomly and go all

in on it. That's exactly what they've done. It's worked out. And I'm really excited to see if this team can get to the Premier League next year. It's going to be hard. I mean, what they've done the last three years is unprecedented. It's never possible. It just can't happen. You can pour all the money into the world of the world into these teams and they still may not win, right? It's like sports, you just don't know what's going to happen. So there's definitely been a little luck. But when they get to the championship, it's going to be much harder. These teams also have a lot of money. They're going to be competing with some serious

English soccer clubs. But if they do it, it will be the craziest thing in the world. And you said you had this dream of buying, you know, a sports team. Well, a lot of American investors have plowed money into buying English soccer clubs, not just Robin Ryan, but a ton of other investors in the United States. And, you know, after a few rocky years of them getting run out of these stadiums, it's been super successful. Also yesterday, Liverpool won the Premier League, the top league in England. They are run by Fenway Sports Group, who owns the Red Sox. And Leeds, which is currently, you know, up there in the championship is also owned by America. over one third of the entire soccer clubs

in the top three English divisions are owned by Americans and are finally starting to win. Neil, cue exciting announcement and upbeat music because my winner of the weekend are people who enjoy subtitles. Why? Netflix has increased their closed captioning offerings which will now allow people to only get subtitles

of the spoken word and not general information like ominous tones playing or car door slams if they prefer. Studies have repeatedly found that about half of American households watch TV and movies with subtitles on, but only a relatively small portion of those include someone with a hearing disability. That's because people just have trouble understanding dialogue in modern viewing situations. Other streaming platforms like Amazon Prime Video have attempted to combat this issue with

audio boost technology that basically identifies more soft-spoken parts of movies or TV and boost the audio to more enjoyable levels. I guess this is quite exciting, although I have to admit, I'm not a subtitle guy. I'm not a subtitle guy either, but I completely sympathize with people who say, I can't hear what they're saying now. I mean, that's certainly a trend that, you know, you can't ignore. There's a few different reasons why this has been happening. One is that microphones have gotten better, so actors don't need to enunciate and project as they used to so they can be like Robert, Robert Patterson, Pattinson in the Batman and just be like really soft-spoken.

And, you know, that conveys maybe more emotion, but you still can't hear it when you're watching it. Also, you know, streaming services compress audio now into these very small speakers because these TVs, as you know, like are very thin and they want to put the speakers in the back. So you need to compress your audio. So it's just become a much harder proposition to get people to hear what these actors, who are being more nuanced and soft-spoken are saying, so there's been a confluence of factors leading to just worse audio all around in TV and movies. Netflix thinks it's doing something about it with its new,

you know, with its new close captioning that is just focused on people who watch the subtitles because they can't, they can't understand what people are saying. I also learned that you can customize the close captioning or the subtitles on Netflix, so you can change the font, the size, the shadow, the background color. I never even knew this. So subtitles are like a new genre for me. I'm going to have to go dive deep in this weekend and experience this Netflix update. It's Monday.

So per tradition, here are the events you need to note for the week ahead. Canada will hold elections today in a race that's been totally shaken up by President Trump. In January, Canada's Conservative Party, led by Pierre Pahliev, held a commanding 25-point lead in the polls over the liberals, who were in disarray after Justin Trudeau resigned as prime minister. But Trump's tariffs on Canada plus his overtures to make it the 51st U.S. state have, completely turned the tables in favor of the liberals and their new leader Mark Carney, the former central banker and current prime minister who's rallied the nation against Trump. Now polls show Carney has the momentum and could win in a shocking come from behind victory.

And Neil, you mentioned Carney's the central banker. He's also the only non-Brit to lead the Bank of England, which is wildly interesting. So the Canadian election will be fun to see how that shakes out. I won't blame you if you're glued to your Robin Hood account this week because it's going to be a wild one in the markets. First, high stakes earnings reports are coming from four of the magnificent seven companies, Apple, meta, Amazon, and Microsoft. In total, about 180 S&P 500 companies, accounting for over 40% of its market value will post quarterly results this week. Plus, lots of key economic data is on the way, which will show whether Americans souring vibes on the economy will show up

in the hard numbers. The print for first quarter GDP will be released. So will inflation data for March. And finally, the jobs report drops on Friday. The labor market is expected to have held up just fine this month with estimates of 135,000 jobs added. On Thursday, brace yourself for a whole lot of Justin Timberlake because it's going to be May. And in sports, horse racing's triple crown season kicks off on Saturday with the Kentucky Derby. Kyle, have you got your Derby hat picked out? No, I spent all my money on this slate pre-order. So I got to go find some dough and get a Kentucky Derby hat.

And then also in sports, the first round of the NBA and NHL playoffs do roll on throughout the week. And it's just been a delight so far, especially the NBA. Incredible games. So good. And I have to make one Minnesota reference. So go Timberwolves. Let's wrap it up there. Great.

Let's wrap it up there. Thanks so much for starting your morning with us and have a wonderful start to the week. Kyle, appreciate you filling in today and Friday. You bring such awesome energy to the show. Always a great time, Neil. Tomorrow, Toby will be back and you can sleep in. I'm excited for you. For any questions, comments, or feedback,

send an email to Morning Brew Daily at Morningbrew.com. Let's roll the credits. Emily Milliron is our executive producer. Raymond Lue is our producer. Our associate producers are Olivia Graham and Olivia Lake. Yuchinawa Ogu is our technical director. Scoop Star Daris is on audio. You'll never walk alone hair and makeup.

Devin Emery is our president and our show is a production of Morning Brew. Have a great week, y'all. You can't reason with the sun. Trust us. We've tried. This summer, it's time. to put that angry ball of fire on mute.

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