BYD Zooms By Tesla & The Boston Celtics Sell for Over $6B
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00:29Good morning, Brewed Daily.show. I'm Neil Fryman. And I'm Kyle Hagee. Today, an NBA franchise set the record for the mostexpensive sale in pro sports history. And the U.S. hits its lowest ranking ever in theWorld Happiness Report. It's Friday, March 21st. Let's ride.Kyle's here. Let's go. Manu Genobley. Sixth Man of the Year is back to fill in for Toby today.Kyle, how are you feeling this Friday? I'm feeling great. It's good to be back in the ManuGenobley spot. So ever since by now pay later giant Klarna filed for an IPO last week,it's been inking partnerships left and right. And its latest move yesterday raised a lot of eyebrows
01:13and led to a lot of jokes. It made a deal with DoorDash to put its payments tech into the deliveryapp. So now you will be able to pay for your DoorDash burrito where pad tie in four equal interestfree installments or even defer payments until what Clarna calls a more convenient time. Kyle,Are you on board with Eat Now, Pay Later?I think I'm on board.I feel like I'm doing something wrong.My Grubhub orders, my DoorDash orders, they've never been that big.Like, should I be ordering more stuff?
01:43And I need to be hitting like triple digits here?No, that's not.I don't think that's the balance here.It's just to establish Klarna as the go.I mean, yes, this is the business strategy behind it.To establish Klarna as sort of the go-to payments portal that you go to,whenever you buy anything doesn't matter the size.But obviously, the size of,
02:01the order of what you typically do on DoorDash is not that big, which led to, you know, a hugesocial media joke fest around this news yesterday.I'm going for over $100 on Taco Bell later today.All right.Right out.Before we jump into the show, a quick word from our sponsor, Sophos.Kyle, I have a question for you.Do you ever feel stretched a little too thin?
02:22The days where I wake up early with the morning, your daily crew are certainly longer than others.I hear that.Well, whenever you need a little extra backup, Sophos is they.They make sure your cybersecurity is locked up tight.Now that you mention it, I do remember you and Toby talking about the importance of defense and offense yesterday.Exactly. With SOFOS, no matter your business's size, you get enterprise-grade technology and real-world expertise, always in sync, always in your corner.Playing zone defense or full court press.Okay, someone watched 12 hours of basketball yesterday.
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03:29Monopoly is a trademark of Hasbro. Hasbro is not a sponsor of this promotion.Well, I think this is a first, but because there's such big stories, we're kicking off our Friday show with Stock of the Week, Dog of the Week, the segment where Kyle and I pick one stock that's got McNeese State Level aura and another that got bounced in the first round.Today, we're doing a two-for-one special, kind of like pert, shampoo, and conditioner.Our stock of the week is Chinese electric vehicle giant BYD, and our dog is its U.S. rival, Tessor.BYD shares soared to a record high this week after making an astonishing claim.It said it had developed a new charging system that could add nearly 300 miles from five minutesof charging or about how long it takes to fill up a tank of gas.This ultra-fast charging innovation was called a game changer by experts and rock the auto world.
04:20Solving the problem of range anxiety and long charging times could convince more shoppersto choose BYD over competitors in China, the world's biggest market for E.As for Tesla, the company may be in its most turbulent stretch in its history.It issued another cyber truck recall number eight.Sales are in reverse.Sometimes violent protests have erupted across showrooms and charging stations,and major investors and analysts are calling for drastic changes as CEO Elon Musk emerges as the public face of the Trump administration.Shares are down nearly 5% this week, and they fall in nearly 40% this year, the worst performer in the S&P 500.
04:58But let's start with BID, Kyle.This Chinese car company is taking over the world.You can't miss it seemingly these days.And if this charging claim is true, this brings about BYD up to 80 kilometers per minute for charging compared to Tesla's 18.So if this proves to be true and they can build a network, this is a leap in terms of charging an electric vehicle.What I think is really interesting about BID, it's not just about the technology, but this also illuminates the kind of geopolitical trade uncertainties.well, Kim Sung-Tay, an executive at the Korea Battery Industry Association, said, quote,our companies will maintain their dominance in the U.S. market as long as the IRA, the Inflation
05:39Reduction Act, is maintained, referring to Biden-era legislation, which excluded electricalvehicle tax credits to Chinese car companies. And so you don't see a lot of BYDs in the U.S.because of the trade. Any. Yeah, any because of the trade regulations. However, they are takingover the world. And so that will be really interesting to see how it plays out with tariffs andtrade uncertainty only increasing. Right. So last year, the Biden administration when he waspresident implemented 100% tariffs on Chinese electric vehicles to protect the Detroit auto makers.Canada also has 100% tariffs. The EU has about 18, 90% tariffs on BYD and other Chineseelectric vehicle makers to protect the domestic industries. But still, BYD is becoming
06:26an export power powerhouse. It already has 15% market share in China, which is the world'slargest market for EVs. But it has absolutely expanded its reach to developing markets.And it's going toe to toe with these other automakers in places like South Africa,Turkey, Chile, South America. In South Africa, China made vehicles accounted for nearly 10%of sales last year, which is five times the volume sold in 2019.Go to Turkey. Chinese brands claimed an 8% share in the first six months of 2024. That's up frombasically zero in 2020.So you're seeing a global turf war being fought between really cheap and high quality
07:04Chinese cars, which it was crazy because they could not, they were not an export powerhouseat all.This is Germany and the United States domain and South Korea and Japan, but they are runningthat playbook.And we'll see whether they come to the United States shores, but it is unlikely giventhat there are 100% tariffs on BYD and other Chinese EVs to protect.the local industry. Yeah, you're spot on. I mean, those stats, you read a lot. China sends morevehicles abroad than any other country. Its passenger car exports surge nearly 20% to 4.9 million in
07:362024 alone. And so I think we're seeing global influence of China through carexportation only increase. And it'll be really interesting to see how that plays out.The other thing is that's going back to the technology, the self-driving technology that BYD has and isenabling everyone who buys a BYD car to get is also putting pressure on Tesla where you actuallyhave to pay for that feature. Right. So in China, where Tesla and BYD are going at it on the roads,Tesla charges you $8,800 to buy driver assistance features. B.YD offers that for free, a number ofother Chinese EV makers also offer driver assistance for free. So Tesla will certainly be facingpressure to bring those costs down, because when you're looking at whether to buy a Tesla or a BYD
08:25ID, that $8,800, if you know, more consumers do want those driver assistance features whenyou're looking at, you know, not paying anything or $8,800, which is the cost, which is nearlythe cost of the cheapest RID model, that can certainly go into your decision making.Let's move on to Tesla, the dog of the week.This company is really going through it right now.There was a major note published by an analyst who was one of the biggest Tesla Bulls on Wall Street.that is making waves this week.Dan Ives, who's at Wedbush Security, said,
09:00let's call it like it is.Tesla is going through a crisis,and there is one person who can fix it.Musk as someone who is a corporaland believer in the Tesla long-term growth story,I loudly urge Musk and the board to step up,stop being silent, and help resolve this crisis forming at Tesla.That's what I've said.
09:19And with the crisis he's referring tois all of this violence that has been wagedagainst Tesla showroom,and vehicles across the United States and across the world as well, sinking sales in Europeand in China and in the United States.They've gone into reverse and a plunging stock price, the worst on the S&P 500.Yeah, the stock price is down 42 percent, nearly 42 percent this year.It originally rose a bit due to must relationship with President Trump.
09:45That has been nearly wiped out this year.The other thing that's concerning for Tesla, some data from morning consults,They're favorable and unfavorable ratings.It used to be pretty wide.People really had a positive rosy view of Tesla.Now, according to January 2025, 35% of people have a favorable view and 30% have an unfavorable view.So that gap has really, really shrunk.And the brand has become less rosy in the eyes of a lot of consumers.
10:12So a falling stock price, a falling brand, it is probably a crisis at Tesla.JP Morgan analyst Ryan Brickman wrote in a research note this week.We've struggled to think of anything analogous in the history of the automotive industry in which a brand has lost so much value so quickly.And perhaps that brand erosion fell even more this week when Tesla announced its eighth recall of the cyber truck.About 46,000 of them.They need to fix an exterior panel that could detach while driving.That happened yesterday.So, yeah, you have investors and analysts calling on Elon must to make a public statement saying how he's going to be.
10:51balance his duties in Washington with Doge with also running Tesla and all of his other companies.Yeah, and we, I mean, we have some like maybe unforced errors at Tesla, but going back to thestock of the week, BYD, the competition is also increasing. So there's a lot of pressure from alldirections to Tesla. Yesterday afternoon, President Trump signed an executive order directingeducation secretary Linda McMahon to dismantle her own department. Trump and many conservative criticshave argued that the education department is wasteful financially and educationalwould be better if left to individual states to manage.Among its many programs, such as tracking student achievement and supporting students with
11:28disabilities, the Education Department is essentially a giant bank, overseeing a massiveportfolio of student loans, $1.6 trillion belonging to over 44 million American borrowers.In fact, it's the third largest source of household debt in the United States.The proposed winddown of the Education Department has raised a lot of uncertaintyover how those loans would be administered going forward.The White House yesterday tried to calm those fears,saying that even as it stripped for parts,the Education Department's critical functions would continue,
11:59such as the oversight of student loans and Pell Grants,which provides aids to students below a certain income threshold.Still, Trump's goal is to make the agency a shell of its former selfand ultimately eliminate it,but expect court challenges because it would take an act of Congressto fully abolish the department.get ready for what the New York Times called a seismic legal battle over the federal government's role in the nation's schools.Taking a look at the stuff that's adjacent to the loans, like a public service loan forgiveness.
12:27So once you have a loan, how does the government help you pay that back?It gives people that work in public service and nurse a firefighter the opportunity for their loans to go away after they've made payments for 10 years.It's like unclear what's going to happen to that program.There's a lot of questions still here on the kind of domino effects that this decision will have.Conservatives have been criticizing the education department since 1980 and think that states and local governments should oversee education and student loans more broadly.But when we're talking student loans specifically, if you want to move the portfolio of $1.6 trillion somewhere from the education department, the question is which new department oversees it and what expertise or skills do they have as banking managers to disperse loans and collect that revenue and all that stuff.One place where they could go, ultimately, is the Treasury Department.Some advocates of this move say that the Treasury Department has the banking expertise,
13:28it has the know-how to be able to administer such a cumbersome and massive program.Trump has also floated the small business administration,and some even on the more extreme level, would say we should privatize everything about the student loan process.That would be a seed change.92% of student loans are from the public sphere.Currently, so the main thrust might be that it moves to the Treasury Department if theeducation department is totally wound down.Critics of moving into the Treasury Department say, like, this will be messy, and we have a lot
14:04of things tied up in student loans right now.We should not be moving this huge chunk of loans from one department to the next.We don't know what could get caught in the middle.They acknowledge that maybe this process, the student loan apparatus as managed by the educationdepartment isn't the best.You know, they acknowledge there are certain mistakes, but moving it wholesale from one agencyto the next would be a mistake.You mentioned that it would likely take an act of Congress to officially wind this down.
14:31The House actually considered an amendment to close the agency in 2023.60 Republicans joined with Democrats and opposing it.So it's even unclear if Congress has the appetite for this.However, there's been agencies in the past that were,phased out from the Interstate Commerce Commission and the Civil Aeronautics Board were two of them.And then additionally, no cabinet-level department has been abolished outright since the U.S.Postal Service replaced the post office department nearly a half century ago.So there's some precedent, but not a whole lot of precedent for doing something like this.
15:00Expect major legal battles ahead over the fate of the Education Department.Up next, Snow White and the never-ending controversies.We're the Hartford, with decades of experience ensuring millions of unique small businesses,when it comes to your small business insurance.Thank you.One size, absolutely, does not fit all.Get a quote or find an agent today at thehartford.com slash small business.It's time to refresh your yard during spring backyard days at the Home Depot.
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15:53It's a great time to check between your couch cushions to see if you may have a spare NBAfranchise hanging around because they are fetching a pretty penny as the Boston Celticsjust sold for $6.1 billion to a group led by private equity executive Bill Chisholm.This sale is the highest of any sports franchise.pretty easily surpasses the $4 billion and $3.5 billion paid in 2022 and 2023, respectively,for the Phoenix Suns and the Dallas Mavericks, the last two NBA franchises to be sold before the Celtics.Now, in the background, the valuation of sports franchises have been skyrocketing amidst a general rule change.Most leagues have adopted allowing private equity firms to take stakes in teams,
16:39making it harder for a single individual or a family to own a team outright.Who was selling the team?Well, the Celtics majority owner was Wick Grosbeck.A group led by Grosbeck bought the Celtics in 2002 for $360 million.And if you felt bad for Wick for only making a 20x investment here,don't worry.Hopefully the two championships the Celtics won during his tenure will help him sleep at night.Final note, the deal still needs approval from the NBA's board of governors.
17:08And so it should take a few months to officially close.Neil, when is Morning Brew going to buy a franchise?We've got to get in the mix here.We're trying. It's getting a little out of our price range.$6.1 billion.And Axios also reported that 6.1 is not going to be the end price here.There's going to be another round of investment that eventually bumps the price up to $7.3 billion.And it shows the marquee nature of that Celtics brand.
17:37They're coming off a national championship.They've won 18 titles, most of any NBA team ever.But when you talk about Bill Chisholm, when this news dropped yesterday, people were like, who?This guy didn't even have a Wikipedia page before he led an investor group to buy the Boston Celtics.He's the co-founder of Symphony Technology Group, which is out of Menlo Park, Silicon Valley, California.He grew up on the north shore of Massachusetts.He's a huge Celtics fan and went to Dartmouth.So he's a New England guy.
18:10He went to the West Coast to make his fortune.is coming back to buy the Celtics and is paying a lot to do so,but there's a lot to, you know, a lot to like about buying a sports franchise.Not because of what you said, valuations are booming.There's huge TV rights deals coming.And this also sets the stage for NBA expansion.Yes, that is a really interesting angle.And because of these increased valuations,
18:34the fee that would be dispersed to all the teams for allowing another team to enter the league would increase.and just the competition for buying a franchise is really, really heating up.Steve Pegliakua, who's a minority owner of the Celtics or was,actually put together a group to try to buy it.He was like, we got the best people, we have the best technology,we would not have any debt financing,and he was rejected for another offer.So people really want to buy franchises.
19:00They're the things that even sometimes a billionaire can't buy outright.There's also a sports angle here, which is the team is quite good,and their roster is very expensive,and so they're getting into luxury tax bill territory.And so it's still unclear just how much this new ownership groupwill be willing to put money into itor pay these luxury taxes.Although he did say, quote,
19:22I bleed green, I love the Celtics, and it's all about winning.So we'll see if Bill is ready to foot the bill.We'll see whether he's ready to foot the billbecause this team is going to cost $400 million in payrolland taxes coming up.Yeah, Jason Tatum, Jalen Brown.They're probably staying, but who knows about the rest of this team?Yeah, something to watch going forward.
19:42Let's move on to our next story.The new Disney remake of Snow White comes out today, and it's unclear which is more entertaining.The actual movie or the behind-the-scenes story of this movie's journey to the big screen,which makes eating a poisoned apple look like child's play.So here's the details, Neil.First, just some bad luck.COVID cases flare up in London just as production gets underway,forcing Disney to increase safety protocols, which starts to blow at the budget.
20:09Then one of the sets catches fire and has to be redone,and the 2023 actor strike and complication from Galgado,who plays the Evil Queen, her pregnancy,forced Disney to halt reshoots, do visual effects over again.Then, just on top of bad luck,people think Disney made a lot of unforced errors during the production of this movie.The star of the movie, Rachel Zegler, made some comments that people implied throwingshade at the OG Snow White movie.
20:34So some fans were put off by those.In addition, many thought Disney flubbed this response to some leaked images that came out from the movie,which had people concerned that they actually just scrubbed the dwarves entirely from the movie.On the other hand, stars like Peter Dinklage felt like the movie was perpetuating negative stereotypes.These unforced errors, I think, highlight the difficult cultural landscape.Disney has tried to navigate over the years making this movie, seemingly angering people no matter what they did.the whole roll out could be summarized by the trailer stats,which have passed over 1.5 million dislikes on YouTube.
21:11Neil, is this actually a big deal, or is this movie going to be just fine?We'll find out this weekend.I mean, Disney has done this series of live-action remakes,Little Mermaid, Lion King, Mufasa, Aladdin, Beauty and the Beast.They have Lilo and Stitch come and Moana coming up where they take their old animated movies,and in terms of and make them into live actionvery weird looking remakes,but I guess people watch them.
21:37But Snow White is very interesting IPbecause it came out in 1937a long, long time ago,very, you know, a lot longerthan some of these other live action remade.So if you are trying to get kids excitedabout certain princessesand getting them to come to your theme parks
21:56and just be involved with this particular IP,snow eight might not be on their radar.this is a big deal for Disney to get Snow White back on the forefront of people's minds so they can get that Disney flywheel going.You see the movie, then you go to the parks, then you buy the toys, et cetera, et cetera.Then you watch the show on Disney Plus.So this is very important for Disney to get Snow White back on the forefront of kids' radars.Yeah, I think you hit the nail on the head.And there was actually these rumors that they might kick it to streaming.
22:22Like, oh, this is not going to perform well.Let's just put it on Disney Plus.The budget had risen to 270 million.And Disney Plus would have had to absorb those costs.and Disney has made this whole point of making their streaming much more profitable.So to the big screen, it's going to go based on ticket pre-sales and some surveys of moviegoers,Snow White, it's expected to collect between $45 million and $50 million at domestic theatersover the weekend, again, according to box office analysts.
22:48And so that's a decent number, but in the 15 years that the company has been producing them,none of these big budget entries have exclusively arrived in theaters to less than $58 million.in. So this would actually be kind of a down round for Disney if it does hit those numbers asprojected. These live action remakes do generally really well at the box office. Last year,Mufasa, the Lion King film, which you didn't know existed, made over $713 million globally.Beauty and the Beast back in 2017 opened $175 million domestically. So these are these are huge,potentially huge movies. And you know, we'll be back on.Monday with an update on how this did at the box office. Despite all of the controversies,
23:33reviewers said this was one of the better remakes of them all. Yeah, and David A. Gross, a boxoffice analyst, actually said never doubt the babysitter effect, which is if you're babysittingkids and you need to entertain a six-year-old, you take him to the movies. Probably why I'dnever heard of Mufasa, yet it did 700 million. So the babysitter effect might save Disney here.Finally, Happy Friday hits different today because the annual World Happiness Report ranking countriesby how happy their citizens are just dropped.And I'm going to have to ask the creators of Nokiaand an epic sauna culture to wipe that grin off your face.
24:07For the eighth year in a row, Finland was found to be the happiest country in the world,followed by fellow Nordic nations, Denmark, Iceland, and Sweden,which was the same order as last year.Why are Finns so dang happy?Residents say there's a great deal of trust, connection,and knowing your fellow people have your back,especially when it's dripping with steam.Meanwhile, Americans continued their slide in happiness with the U.S. falling to its lowest ranking on the list ever, 24th, down one spot from last year, and I'll plunge from a peak of 11th place in 2012.
24:40The drop is being driven by people under 30 who, according to Gallup, feel, quote, less supported by friends and family, less free to make life choices, and less optimistic about their living standards.This seems to be the case for all big high-income nations, with none of the large industrial powers ranking in the top 20.for the first time in the history of the report.Kyle, what was your takeaway from the happiness?I mean, my big takeaway is Finland is on a heater.They cannot be stopped.I actually love this report.I think people when they hear World Happiness Report think it's like a flimsy kind of study.
25:11It's actually pretty, it's done very, very well.So how they do this is it's a self-assessed life evaluation,averaged over 2022 through 2024.And they take into account GDP per capita, social support,health life expectancy, freedom, generosity, and freedom of corruption. So it's actually a prettyrobust survey. And going to the website and reading through it is really, really interesting.I do want to double click on the U.S. and young people. Among the 143 countries surveyed,the U.S. ranked 10th for people 60 and older, but 62nd for people under 30. And so it seems
25:45like young people in America are really not having a good time. I do have one qualm with the report,though, it went into howdining alone is kind of takingover the world and that might be causing somesadness. I lovedining alone. So leave...I'm defending dining alone. I'm a very happy person.So I like dining alone.
26:04The rest of the report had a lotof interesting nuggets in thereand yeah, the U.S. young people angle isreally, really sad. But let's talk about,I'm not going to use your corporate jargonwith double click, but let's go intothat dining alone thing.You say it's not a predictor
26:20of happiness, but the experts at the World Happiness Report say it's an incredibly strongpredictor of happiness. They said meal sharing was a stronger predictor of well-being than incomeand unemployment combined, which is truly mind-blowing. And they said that meal sharing or the lack of itwas one of the main reasons that the U.S. has continued to drop down the rankings. It found that26% of U.S. adults said they ate every meal alone the previous day, which is a 50% increase between2003 and 2023. The U.S. ranks 69th globally in meal sharing, which is not nice. Canada is ranked53rd, which a little ahead in the UK is 81st, so a little pure comparison there. But they dosay that meal sharing is a big deal, strong predictor of happiness. I know. I guess I'm bucking
27:09the trend there. The World Happiness Report, too, like it has themes every year and this onewas all about like benevolence. And I actually think it's a maybe nice way to end. Theyfound that most people think other people are less kind than they actually are. And if yousurvey people on like how many people would pick up a wallet and return it to an owner, peoplethink that no one would do that. But in reality, when they run experiments, almost everyonedoes. And they saw that this is actually a very powerful intervention. Stanford University dida study where they told people the actual reality of how kind others are. And it made everyone elsedo more kind acts and feel happier. And so I get a sense that we have the wrong perception
27:48of other people, and we actually are a lot nicer than we think, and that leads to more happiness.In Toronto, the expected rate of a returned wallet was just 23%. The actual number of returnedwallets was more than 80%. So I guess if we're going to leave you with anything this Friday,it's go share a meal with someone this weekend, and trust that your fellow people arenicer than you think they are. I think that's a nice happy note to end on.All right, let's wrap it up there. Kyle, appreciate you stopping by, and thank you.for starting your morning with us. We've got an epic weekend on tap with the women's collegebasketball tournament kicking off today. Another big slate of men's games and a lot of
28:27meals shared with other people. Maryland, do not let me down. For any questions, comments,or feedback, send an email to Morning Brew Daily at Morningbrew.com. Let's roll the credits. EmilyMilliron is our executive producer. Raymond Lou is our producer. Olivia Graham and Olivia Lake areour associate producers. Yuchinawa Ogu is our technical director. Scoop Starteris is onaudio, hair and makeup finally found where True TV is.Devin Emery is our chief content officer and our show is a production of Morning Brew.Have a great weekend, everyone.
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