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Paul J Daly 0:01
Christmas week. Everybody, Santa's coming December 23 everybody, a lot of people are still working. If you're in a cardio, definitely working. Today, we're going to talk about this Honda Nissan thing, and we're also going to talk about the market cap
Unknown Speaker 0:14
of the people
Paul J Daly 0:16
who I isn't Wow,
Kyle Mountsier 0:19
big global things this morning on a Monday. Through it, we'll talk you through it. There might be a little counseling somewhere in here,
Paul J Daly 0:27
crying. Little counseling. What do you do the weekend before Christmas? Tell me
Kyle Mountsier 0:35
finish the Christmas shopping, which I've done three days early. Ladies and gentlemen,
Speaker 1 0:39
do it. Oh my goodness. Yeah, I
Kyle Mountsier 0:44
don't know, it's like, pretty chill for us. This is a, this is an interesting one. And, you know, it's still, I'm only three years removed, but, like, 12 years in professional world versus three years, it's still weird that we're taking tomorrow off. You know, as a company like, that's still weird to me. Retail still stays in for at least half a day type thing. But, you know, so you get this, like, two days off, one day on, two days off type thing. So it's, I'm, I'm all mixed up.
Paul J Daly 1:08
Yeah, you know it's gonna be, it's gonna be that way. It's, what'd you do
Kyle Mountsier 1:11
this weekend? You had all your Christmas shopping done. You just basically took naps all week.
Paul J Daly 1:16
Four kids didn't do any of that. Oh, man, one of them's a five year old. What did I do next weekend. Watch the, watch the Eagles. Liza, terrible. Sorry, terrible. Yeah, thanks for bringing that up. Saturday. I'm trying to, I can't. Literally, we had a Christmas
Kyle Mountsier 1:30
cookie cook off at the at the church after church yesterday, and so, like all these kids were running rampant,
Paul J Daly 1:37
you know, I'll sugar, oh, I went. We went and visited family. Really snowy. Drive has been really cold up here and snowy, so I got my snow tires on last night at Costco, which I literally my wife and I were the last people in Costco, except for like, one or two employees. It was kind of fun, because they were running behind and everyone's getting their snow tires on. So we were sitting in Costco watching their end of night for the seizures. And let me just say, the way they clean up the snack area, and the way they clean up all the cashier lanes, you think, like all those people go through electric leaf blowers, what they're like, that's literally what they did out of every single thing. It made sense, too. Makes
Speaker 2 2:20
total really did make sense, saving the world more electrically over time.
Paul J Daly 2:24
Hey, if you haven't seen it yet, we had our year in extravaganza, our fourth annual last week. But you can watch it because the recording lives on, because this is the internet age. You can go to asotu.com, it's right there toward the top of the page. You can click it. We had so much fun, so many guests, maybe gotten a little bit of trouble you'll have to see and we hope that you'll just check it out as a fun way to end the year. Wrap Up. Laugh a little show some of your friends and family how fun this industry actually is. And, yeah, that's kind of like one of the things we try to give to the industry at the end of the year, because we've all earned it. You know
Speaker 2 2:59
what I'm saying? And we love you guys. We love you for listening, for watching. I
Paul J Daly 3:03
know. Thank you so much. Okay, listen, um, Honda and NIS is kind of the only real news circulating right now. Everyone's kind of pushing this break, unless your Japanese automaker, Honda and Nissan are set to create now a unified holding company to strengthen their competitiveness amidst all these industry challenges set to launch by August 2026 so it's not going to come really quickly. The combined hard to merge that level of thing, you know, the number one and number two automakers in Japan. So basically, this is going to the combined entities looking to generate 181 billion in annual revenue, 19 billion in operating profit. HOD is going to take the lead in the new company, nominating the key executives in determining the strategy. Plans include advancements in EV software development, sales financing, and they're looking for measurable results by the year 2030, it's back.
Kyle Mountsier 4:00
Well, we're kind of round in the corner, yeah. So you basically get that every five year thing, and you're like, we can't do the 25 thing. Go with the
Paul J Daly 4:08
30 thing. Five in our plan is a full reasonable thing when we're talking about 20 it just wasn't so much four years ago. And we're like, we're gonna do all these things. So basically, Honda CEO Toshiro, maybe describe the merger as critical artillery for competing. By 2030 we have potential to be a world class, leading company in mobility. So looks like this is happening.
Kyle Mountsier 4:32
Yeah, this is definitely happening. I mean, there's been too many reports of it, and now the reports of like, everybody's shaking hands, standing together, it's on, you know, I think for me, obviously the clear winner, and this is Honda. They clearly took the lead in the act in the in the merger, and now are taking lead in the new company. They've obviously been someone that has been more resilient in the global like name and also just business strategy, but they're going to gain a lot out of the production capacity. 90s, the the buying capacity of Nissan, you know, they're still both massive, even if they've seen some like hiccups in the Nissan World over the last five or six years in the US. Yeah. I mean, this will be, this will be a crazy partnership. I'm interested, you know, being, being from Nashville, where the sun's headquarters,
Paul J Daly 5:21
right? Like
Kyle Mountsier 5:22
this will, this will be interesting to see if, you know, Nashville gets like a Honda, you know, entity or element here, or whether it gets stripped out. Where's Honda's
Paul J Daly 5:32
North America headquarters? It's not as wherever it is. It's not as cool as Nashville gotta
Unknown Speaker 5:37
be, not, no.
Paul J Daly 5:39
Well, yeah, you're gonna look it up. Well, let me say this too. We you and I know a whole lot of Nissan dealers, right? So obviously getting opinions, asking people how things going, getting thoughts on it, we also know a lot of Honda dealers, right? And so some of the comments that have come out from the Nissan dealers opened my mind a lot to why this, the implications that this is happening for Nissan dealers across the board. One of the things that you and I didn't really talk about last week, we're like, Oh, this looks good. A little more stability. Here's here's a big part of this has to do with the Japanese Government keeping China out of its business. That's right. And so it's like, wild, keeping it in the family. If you think about like, national politics is the most important thing for these two to merge. So don't think that the Japanese government is like, Oh no, no. You guys are gonna do this, right? And we'll help, and we'll do this. However, the complexities that that creates for Nissan dealers, think about this. If you're a bank, lending to a Nissan dealer, operating, operating expenses, lines of credit, trying to get a loan. Are you a bank? Are you lending to a Nissan dealer right now? No. Interesting. You're actually calling your Nissan deal because, like, what's the store actually worth? Right? Like, are they gonna close stores? Are they gonna right? So you start thinking about, I've also thinking on the credit side, like Nissan, like captive finance. I heard there was a deal on an armada 800 credit score 10 grand down. They would not buy the deal. Really,
Kyle Mountsier 7:16
it's like there's almost some fear in what's coming down the pipe, yeah, you know. And, and whether or not, like, the Nissan side of the business is going to hang on when you've got, you know, I mean, American Honda finance is, like, an incredible finance arm, yeah, right. Um, yeah, that's, that's an interesting take there, yeah,
Paul J Daly 7:38
what are they gonna do? They have all this inventory on the ground, right? There's no incentives right now. So how are you going to move all this inventory that's on the ground right? A fraction of the stores are profitable, like
Kyle Mountsier 7:47
and the and there's already been Nissan dealers saying, hey, look, we've lacked innovation over the last five years. You see the declining sales rate, you know, question marks all around the brand right there. And Honda's obviously got, like, it's not like they need help on, like, the finance side, or the R and D side or the product side, you know, right?
Paul J Daly 8:05
So another question is, like, what does this do for the Honda dealers? Like, if you're a Honda deal, like the flip side of it, like, we'll try to get some people on the show so they can comment on this. But if you're a Nissan dealer or a Honda dealer, please let us know what you think. You let us know in the comments. Or you can actually, just like, send us an email to crew@asotu.com if there's some news you want to talk about, or if you want to have a conversation, we'd love to just get keep the conversation going, because the Nissan dealers, the Honda dealers, like we want to make sure. I have
Speaker 2 8:33
a feeling this is going to make it in the show over the next three years. Quite often, as we see the updates and who's taking what position and what part of the deal, by the way, Honda is located in California, which means they're definitely coming to Nashville. Definitely coming to Nashville, Nashville. How many people they're coming to Nashville? We got, we got, like, eight headquarters that moved to Nashville from California. So you know that Honda is there. They're coming. You heard it
Paul J Daly 8:58
here first, folks. They're like, Wait, they're in Nashville. Like the rest of the rest of the Honda execs, they're in Nashville. Can we transfer? They're like,
Speaker 2 9:06
can we can Can I get everyone the same? Yeah, okay, sounds good. I'm going to
Paul J Daly 9:11
Nashville. Cost of living adjustments. It's literally what happens. It's unbelievable, right now. Speaking of unbelievable, this is truly unbelievable.
Unknown Speaker 9:21
This is nuts.
Paul J Daly 9:23
So Tesla's valuation has soared to a new all time high of $1.5 trillion with a capital T following the 2024 US president, actual presidential election, solidifying some dominance from a market cap perspective. Anyway, Tesla accounts for nearly half, half of the global automotive cap, exceeding the combined valuation of the next 29 auto makers. My goodness, I know the graphic we're showing on the screen is actually from December 13, so it's changed a little bit, which is why it says 1.4 trillion. Key competitors like Toyota, 230 1 billion. 107 billion seem like how are they that far back on market cap? It's crazy. Investors see Elon's close ties with President Trump as a potential boost. No kidding, especially with some anticipated corporate tax cuts. Their stock prices up 57% year to date. Goodness, despite its production, they did 1.8 million vehicles in 2023 right? Toyota did 11 point 2 million vehicles, you know. So here back to this conversation. Kyle,
Speaker 2 10:31
can we talk about how Tesla's not a car company? Ladies and gentlemen, can we just talk about,
Kyle Mountsier 10:37
every time you said it, there was a little bit of a conversation over on Steve Greenfield's LinkedIn, on post about your comments, brilliant. My My comment, I think, has almost as many interactions as the post, because it's like, I have to remind people that that influencer marketing through Elon Musk is the way that they go to market, and they know it, and they capture it via social media. And two, they're a tech company with SaaS options, with with real estate, with infrastructure that other people are leveraging. They are selling back credits to other automakers, like they have an integrated like multi vertical system that is not just a car company, and that's why they can get away with selling out 1.8 million vehicles and having a market cap that beats the entirety of the rest half of the industry combined, of the industry, right? Like that. It's, it's an unbelievable scenario, but you cannot look at them like a car company, because they have integrated multi vertically like no other car company has, and that's how they beat the system. And
Paul J Daly 11:41
so, I mean, you know, to make, to make the comparison, at least, you know, it's not apples to apples, but it's pretty close, speaking of Apple, speaking of Apple, right? It's like Apple was a, are they a computer company? No. Are they a phone company? No. Are they immediate any money? Yeah. Are they data company? Yes, right? Like, are they collecting big checks from Google? Yes, right? Apple, just an ADS company, absolutely so. So I think, like, when you look at that, like, no other auto maker is even close to anything like that. Like, not even close. So, I mean, when the analysts are like, it's ridiculous, look at the volume. I mean, what are those analysts looking like? Are we? Are we now analysts? I guess we are,
Kyle Mountsier 12:21
I guess we're kind of analysts. I think we're the highest one. When I think about the Tesla stock price, I never analyze them against automakers. I analyze them against companies like alphabet, like like Apple, companies that are multi vertical, Multi Product, Multi Product style, in the market, because that's what Tesla has done, like they stand behind the brand that that sits on the name plate of a car, but they are so much more than
Paul J Daly 12:52
that. Yeah. I mean, I'm sure there's some like things that are above my pay grade and from like a stock analyst scenario looking at profit and how the curve should go, but I'm telling you what
Speaker 2 13:02
even look at BYD. I mean, BYD is out selling them in vehicles too, right? Buy a ton,
Paul J Daly 13:08
yeah. So, yeah, I don't know. So that's what's going on. I don't know if it's the right time to buy stock, hold stock. We would never suggest anything. We would never suggest anything, but it's just something, something special. We're gonna have an interesting week for you here on the show. We are going to be you look we know everyone's all these different places. We're gonna bring you a week full of snippets and fun to watch content. So every morning, still, we're gonna have the show for you, and we're gonna try to incorporate some of the fun stuff we've done over the year, just a real fun 10 minute watch in the morning that'll get you laughing you can listen to in the podcast. So we hope you stay with us this week. We know you're gonna be doing a whole bunch of other stuff. Gonna be with your families. You can do Christmas. You selling cars. Gonna do all these things. And we're just gonna try to end this last full week of the year in a real strong way. So anything
Speaker 2 13:55
else? Kyle, that's it. Merry Christmas, everybody. Merry
Paul J Daly 13:58
Christmas. Get your presents. Get your presents wrapped. Tell your friends about how great the car industry is. Oh, by the way, more than cars, you can actually watch it on Tubi now. So we forgot watch it on Tubi. You do that. Why not? You
Unknown Speaker 14:20
can find them.
Transcribed by https://otter.ai