Tariffs Hitting Hollywood? & Air Traffic Control Shortage Delays Newark

Summary

Morning Brew Daily: Tariffs Hitting Hollywood? & Air Traffic Control Shortage Delays Newark
Release Date: May 6, 2025

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1. Trump Proposes 100% Tariffs on Foreign-Made Movies

President Trump announced a controversial proposal to impose a 100% tariff on all foreign-produced movies, aiming to protect and revive the American film industry. In his statement on Sunday night, Trump asserted, “Other countries are offering all sorts of incentives to draw our filmmakers and studios away from the United States” (03:01). This declaration sent shockwaves through Hollywood, prompting studio heads worldwide to hold emergency meetings to assess the potential impact.

Impact on the Film Industry:

• Shift in Production Locations: Many studios have already been relocating productions to countries like Canada and the UK, attracted by lucrative tax incentives and lower costs. Notable films such as Deadpool, Wolverine, and Minecraft have seen significant portions of their production based abroad.
• Economic Consequences: The U.S. currently holds a $15.3 billion trade surplus in moviemaking. Imposing tariffs could provoke retaliatory measures from other countries, adversely affecting both domestic and international markets.

Neal Freyman highlighted the gravity of the situation, stating, “If we put tariffs on foreign-made films, they will certainly reciprocate and put tariffs on Hollywood films. Hollywood makes most of their money in foreign markets, so it could devastate the American industry as well” (07:26).

Stock Market Reaction: The announcement caused a temporary dip in movie-related stocks. Companies like Netflix, Disney, Warner Brothers, and Paramount saw their stock prices fall by up to 5%, reflecting investor uncertainty about the future of international collaborations and revenue streams.

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2. Newark Airport Suffers from Air Traffic Control Meltdown

Newark Liberty International Airport experienced a significant operational crisis due to a prolonged meltdown of its air traffic control systems. Over the past week, the airport faced numerous flight delays and cancellations, severely disrupting travel plans.

Key Issues Identified:

• Air Traffic Controller Shortage: The FAA currently operates at 70% staffing levels, with an urgent need for 3,000 additional controllers to meet demand (11:06).
• Technology Failures: Outdated technology and equipment malfunctions exacerbated the situation, leading to miscommunications and unsafe flight conditions.
• Construction Delays: Ongoing runway construction contributed to the logistical chaos, limiting the airport’s capacity to handle scheduled flights.

One air traffic controller expressed the gravity of the situation to MSNBC, stating, “Don’t fly into Newark. Avoid Newark at all costs. It is not a safe situation right now for the flying public” (09:57).

Government Response: Sean Duffy, Secretary of Transportation, announced a forthcoming modernization plan aimed at addressing staffing shortages and upgrading technological infrastructure to prevent future disruptions.

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3. Resumption of Student Loan Collections under Trump Administration

The Trump administration has initiated the resumption of collections on defaulted student loans, affecting approximately 5 million borrowers who have not made payments since the pandemic. This move contrasts sharply with the previous administration's efforts to forgive billions in student debt.

Consequences for Borrowers:

• Financial Strain: Restarting payments imposes significant financial burdens on borrowers, many of whom are already struggling with low consumer confidence.
• Credit Impact: TransUnion reported that borrowers with previously excellent credit scores could see a decline of up to 171 points (13:27).
• Potential Penalties: The government may garnish wages or withhold tax refunds and benefits for those who fail to respond to collection notices.

Neal Freyman emphasized the prolonged nature of the issue, noting, “This has been five years. Coming back when the pandemic started, the Trump administration paused student loan repayments, and then Biden came in and delayed it nine times” (14:00).

Advice for Borrowers: Listeners are encouraged to check their loan status at studentaid.gov to understand their obligations and explore repayment options to avoid severe penalties.

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4. Autonomous Trucking: Aurora Innovation Leads the Charge

Aurora Innovation is spearheading the development of driverless trucks, with plans to commence fully autonomous test drives on Texas’s I-45. This initiative aims to address the critical shortage of long-haul truck drivers and reduce operational costs.

Industry Context:

• Driver Shortage: The federal government mandates a 50% increase in freight movement by 2050, but driver shortages pose a significant challenge.
• Cost Savings: McKinsey analysis suggests that eliminating driver salaries could reduce operating costs per mile by up to 42%.

Toby Howell detailed the technical advancements, stating, “These trucks are equipped with sensors that can see the length of over four football fields,” facilitating safer and more efficient long-haul operations (20:10).

Regulatory and Union Challenges:

• Safety Concerns: Issues such as automated safety equipment and response protocols remain contentious.
• Union Pushback: Transport Workers Union is resisting the adoption of autonomous technologies to protect driver jobs.

Neal Freyman reflected on the delayed progress in the sector, saying, “There was a lot of problems with regulation and the technology is hard, but now it looks like at least Aurora has one truck going on I-45, and they're hoping to ramp that up soon” (19:03).

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5. Skechers Acquisition by 3G Capital

Skechers, the globally recognized shoe company, has been acquired by investment firm 3G Capital for nearly $10 billion. This acquisition comes despite challenges such as tariffs affecting imports from China and Vietnam.

Financial Overview:

• Sales Growth: Skechers reported over $2.5 billion in sales in Q1 2025, reflecting a 7% growth despite macroeconomic pressures.
• Stock Market Reaction: Shareholders responded positively, with Skechers’ stock soaring by 25% following the announcement (22:22).

Strategic Moves: To bolster its market position, Skechers has recently signed high-profile athletes like Joel Embiid and Harry Kane and launched extensive advertising campaigns featuring celebrities like Snoop Dogg.

Neal Freyman commented, “One of the biggest acquisitions ever in the footwear industry... a nice little payout for Skechers executives and shareholders” (22:22).

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6. OpenAI Restructures as a Public Benefit Corporation

OpenAI, originally established as a nonprofit, announced a shift to a public benefit corporation. This restructuring aims to secure further investment while maintaining its commitment to safety and public welfare.

Background:

• Founding and Funding: OpenAI was founded by Elon Musk, Sam Altman, and others as a nonprofit entity focused on AI safety and ethical considerations.
• Controversy Over Profit Focus: The proposal to transition to a for-profit model faced opposition from stakeholders concerned about potential shifts away from safety priorities.

Neal Freyman highlighted the resolution of the conflict, stating, “The OpenAI CEO announced yesterday that the company would scrap its controversial plans to shed its nonprofit status” (23:36).

Future Implications: The approval of this restructuring by state attorneys general in Delaware and California is pending, which could impact OpenAI’s governance and operational strategies moving forward.

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7. Trump's Plan to Reopen Alcatraz as a Supermax Prison

President Trump has directed federal agencies to explore the reopening of Alcatraz Island as a high-security federal prison for America’s most dangerous offenders. This plan faces substantial logistical and public relations challenges.

Current Status of Alcatraz:

• Historical Significance: Alcatraz has been a major tourist attraction, welcoming approximately 1.2 million visitors annually.
• Operational Costs: Formerly three times more expensive to operate than other federal prisons, contributing to its closure 60 years ago.

Neal Freyman remarked on the feasibility, “The president's plan to reopen the complex might be as hard to pull off as an escape from Alcatraz” (25:00).

Public and Local Reaction: Local residents and tourists are likely to oppose the conversion of a beloved historical site into a prison facility. Alternative proposals, such as transforming Alcatraz into a triathlon venue, have been suggested to preserve its legacy while repurposing its infrastructure.

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8. Skype Shuts Down After 23-Year Run

Skype officially ceased operations yesterday, ending its 23-year history as a pioneer in free global video communication. Microsoft, which acquired Skype for $8.5 billion in 2011, is encouraging users to transition to Microsoft Teams.

Market Dynamics:

• Declining User Base: During the COVID-19 pandemic, while Zoom experienced a 30-fold increase in usage, Skype’s user base declined from 40 million in 2020 to 36 million in 2023.
• Competitive Disadvantage: The failure to adapt to changing communication trends and user preferences contributed to its obsolescence.

Toby Howell humorously noted, “You say, I zoom people. So we've already kind of given its laurels before on the show” (26:29).

Legacy and Future: Skype, once synonymous with internet calling, now joins the ranks of obsolete communication platforms like AIM and Vine, reflecting the rapid evolution of digital communication tools.

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Conclusion

In this episode of Morning Brew Daily, Neal Freyman and Toby Howell delved into significant developments affecting various industries—from Trump's attempt to bolster Hollywood through tariffs and the operational crisis at Newark Airport, to the resurgence of student loan collections and groundbreaking advancements in autonomous trucking. They also covered major corporate moves, including the acquisition of Skechers by 3G Capital and OpenAI’s restructuring. Additionally, the episode touched on the controversial plan to repurpose Alcatraz Island and the shutdown of Skype, highlighting the ever-changing landscape of technology and business.

Notable Quotes:

• Neal Freyman: “If we put tariffs on foreign-made films, they will certainly reciprocate and put tariffs on Hollywood films. Hollywood makes most of their money in foreign markets, so it could devastate the American industry as well.” (07:26)

• Toby Howell: “Believe it or not, these tariffs could end up hurting American filmmakers just as much as foreign ones.” ([earlier section, paraphrased])

• Neal Freyman: “This has been five years. Coming back when the pandemic started, the Trump administration paused student loan repayments, and then Biden came in and delayed it nine times.” (14:00)

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Timestamp Reference Guide:

• 03:01: Trump Proposes Tariffs on Movies
• 07:26: Impact on Hollywood and Global Trade
• 09:57: Newark Airport Safety Warning
• 11:06: Government Response to Newark Crisis
• 13:27: Student Loan Collections Resume
• 14:00: Historical Context of Student Loans
• 19:03: Autonomous Trucking Industry Insights
• 20:10: Technical Advancements in Autonomous Trucks
• 22:22: Skechers Acquisition Details
• 23:36: OpenAI Restructuring
• 25:00: Alcatraz Reopening Plan
• 26:29: Skype Shutdown Reflections

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For more detailed discussions and insights, listen to the full episode of Morning Brew Daily on your preferred podcast platform or YouTube.

Transcript

[Toby Howell]

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[Neal Freyman]

Full disclos and Podcast Description Good Morning Brew Daily Show I'm Neal Freyman.

[Toby Howell]

And I'm Toby Howell.

[Neal Freyman]

Today would before Sunrise have hit the same if they met in Cleveland instead of Vienna? We could find out After Trump proposed tariffs on foreign made movies and a.

[Toby Howell]

Newark airport has been plunged into chaos after a multi day meltdown of its air traffic control Systems, it's Tuesday, May 6th. Let's ride.

[Neal Freyman]

The Pulitzer Prizes were handed out yesterday for excellence in journalism and Toby, we were snubbed again. Just remember, Hitchcock was never given an Oscar for Best Director. Fortunately, all the awardees were more than worthy. The Wall Street Journal won an award for its coverage of Elon Musk's rise to power, the Washington Post won the Breaking News prize for its reporting on the attempted assassination of Donald Trump. And ProPublica won the most prestigious prize for public service with its coverage of the impact of state abortion bans across the country and literature. The book James by Percival Everett, a retelling of the story of Huckleberry Finn from Jim's Perspective, won the fiction prize. And I read this book a few months ago. Great book. If you're looking for a wreck now.

[Toby Howell]

One of these days our ships will come in, Toby's trends will be honored for national reporting or Neil's numbers will snag that public Service award. We will get there. But seriously, a lot of the research that goes into producing our show, Morning Brew Daily comes from the on the ground reporting that these reporters are doing. So if you've ever learned something new or felt just a little bit smarter after a morning listen, you've got them to thank as well. And now a word from our sponsor, Planet Oat. Neil, everyone's talking about how this is the age of AI. Smart fridges, smart vacuums, smart al. Kids who think, chat, cbt, know the answers to everything.

[Neal Freyman]

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[Toby Howell]

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[Neal Freyman]

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[Toby Howell]

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[Neal Freyman]

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[Toby Howell]

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[Neal Freyman]

Well get ready for the Fast and the Furious Kansas City Drift because President Trump floated 100% tariffs on foreign produced movies In a Sunday night True social post, Trump said that the tariffs would save the dying American movie industry. Quote other countries are offering all sorts of incentives to draw our filmmakers and studios away from the United States. Hollywood and many other areas within the USA are being devastated. He said he directed the Commerce Department and U.S. trade Representative to immediately begin the process of instituting a 100% tariff on any and all movies coming into our country that are produced in foreign lands. This threat sent shockwaves across the global entertainment industry yesterday, with blindsided studio heads holding emergency calls to determine what it all means. And really, no one's sure what it means to tariff a movie which is essentially a digital good distributed virtually that doesn't pass through ports. But by bringing up the decimation of Hollywood, Trump is touching on the movie industry's least well kept secret. Many movies aren't made in L A anymore. Lured by tax incentives and lower costs, studios have increasingly shifted production to places like Canada and the uk. Some of the biggest recent blockbusters, Deadpool and Wolverine, Wicked Gladiator 2, a Minecraft movie, were mostly shot abroad. It's unclear whether Trump will move forward with the tariffs on movies, and yesterday the White House appeared to walk it back a little, saying no final decisions on foreign film tariffs have been made. But it certainly sparked a discussion about what it would take to get movies made in America. America again.

[Toby Howell]

First, let's dive into all the questions around this proclamation. Would it apply to American productions that are mostly filmed in the US but have some scenes shot over in other countries? Or would it apply to movies where post production work like editing and you know that visual effects are if those are handled outside the U.S. does that count as well? And then also does it apply to just American Owned movies or does it apply to all movies across the world? So a lot of people kind of went down some of these rabbit holes and found nothing at the end of them is why. Maybe we saw a little bit of the walking back. So probably the broader conversation to have here is just the flight from the US to other countries when it comes to making movies. We were listening to a podcast between Rob Lowe and Adam Scott from Parks and Rec the other day and they are basically saying how it would have been if they were filming Parks and Rec now versus, you know, ten years ago. They probably would be doing it in a Budapest because of how many tax incentives and how much more expensive it is to do inside the US versus abroad. So that is a conversation that Trump is dead on that the movie industry has been fleeing America, specifically California, for far flung places.

[Neal Freyman]

Right. I mean, just look at the numbers. The total amount of money spent last year on film and TV productions in the US with budgets of more than $40 million fell 26% from two years earlier. And it's very acute in L A, which is the home of Hollywood, has the Hollywood sign is, you know, the just the global home of filmmaking and TV production. Their film and production has fallen by nearly 40% over the last decade. And that's because, yes, costs have risen in L A and across the United States and all of these other countries are offering very lucrative tax incentives. And filmmakers say their number one decision making point for choosing where to film is tax incentives. The United States doesn't have as much generous ones as other, as other countries. So that's why you're seeing productions flee.

[Toby Howell]

And we did see some movie related stocks fall yesterday after the news. I mean, Netflix, Netflix was down as much as 4% at one point. Disney, Warner Brothers, Paramount were all in that 3 to 5% range. So it wasn't a huge move, but it was definitely some sort of reaction. And a lot of it is because if you just look at Netflix, a lot of their content is produced internationally. 75% of Netflix entire content slate is internationally. Some of those are literally international films because they have a very widespread audience. But a significant part of its domestic production stuff that you think was made in America was actually made in places like Canada or the United Kingdom. So Netflix is very exposed should this, you know, undefined tariff kind of apply to entertainment filmed outside of the US So that is why potentially they are a little bit nervous and we're kind of coalescing and saying what do we do about this thing? Even though maybe nothing is going to come of it.

[Neal Freyman]

Right? Because you had movie executives from abroad saying this will devastate our industry. From New Zealand, Australia, uk, Canada, saying this would be awful for us. But then also American moviemaking heads also said this would be terrible for us because as opposed to other goods where the US runs a trade deficit with other countries, the US is remains the global hub of filmmaking. We have a $15.3 billion trade surplus in 2023 with the rest of the world. We sell our movies, it's a huge export. We sell our movies to the other parts of the country. We have a positive balance of in moviemaking with every major foreign market. If we put tariffs on foreign made films and they will certainly reciprocate and put tariffs on Hollywood films. Hollywood makes most of their money in foreign markets so it could devastate the American industry as well. So that's why Trump was saying yesterday kind of walked it back these, these tariffs and said he would talk with movie executives to see a plan forward. Gavin Newsom of California, the governor introduced a $7.5 billion tax incentive to lure people back. So maybe, I know Trump and Newsom don't really get along, but maybe they'll work on a particular tax incentive instead of tariffs to bring this industry back. For years, Newark Airport has been the ugly stepchild of New York's three major airports and it's done nothing to shake that reputation. Recently, for more than a week the airport has been gripped by chaos as a cascading series of problems led to hundreds of flight delays and cancellations, frustrating travelers and sparking calls for an overhaul by the federal government. On Sunday, over one third of inbound and outbound flights at Newark were delayed and more than 10% were canceled. The crisis continued yesterday when more than 150 flights were canceled in over 250 delayed. United Airlines, which dominates this airport, has even taken the step of canceling 35 daily round trip flights from Newark with the CEO saying he had no choice. The airport quote, cannot handle the number of planes that are scheduled to operate there in the weeks and months ahead. That's because of a number of intertwined crises including construction on a Runway, chronic air traffic controller shortages and technology failures from anti equipment. Things have gotten so dire at the Nathan at the nation's 14th busiest airport that one air traffic controller straight up told msnbc, don't fly into Newark. Avoid Newark at all costs. It is not a safe situation right now for the flying public. I guess the good news is it's really hard to fly in or out of Newark right now.

[Toby Howell]

Yeah. CNN got the transcripts from some of these air traffic controllers trying to talk to planes. These air traffic controllers based out of Philadelphia's Terminal Radar Approach Control Center. And some of them are pretty jarring to hear. One is a pilot asking, approach, are you there? He tried to contact the controller five times and got dead. Radio silence, which is very scary if you're a pilot because you don't know where you are, where other planes are in relation to you. And so as those 30 seconds of silence emerged, it cascaded into this entire sort of emergency situation here on Newark, which resulted in those thousands of delays, hundreds of cancellations, and it really did leave an impact on the flight controllers as well. At least five FAA employees after that day took 45 days of trauma leave afterward because they were just so stressed out, so high strung that their eyes and ears were basically lost for 30 seconds. And planes started popping up in places that they didn't expect, which is just a very scary thing. So, yes, it is a situation as affecting Newark, but also the broader conversation here is just the chronic staffing delays, the technology, the outdated technology that the FAA is still relying on.

[Neal Freyman]

Yeah, the US needs more than 3,000 new air traffic controllers to reach adequate staffing. They're at 70% levels right now. They have 10,000 professional controllers. They need 3,000 more. So you have Sean Duffy, who's the Secretary of Transportation, really has keyed into this problem, and he said he's going to roll out a modernization plan this week. So we'll hear what the FAA or the Transportation Department has in store for the FAA to improve. Because right now, the situation at Newark is pretty dire and things weren't good beforehand. It came in last in the Wall Street Journal rankings of best large airports in terms of reliability, convenience and value. People were already, you know, not happy with Newark because of its location and its, you know, there were, there were a lot of delays there before this happened. So, yeah, if you're flying out of Newark, I mean, maybe look for somewhere else at this point.

[Toby Howell]

Unfortunately, I have some bad news for about one in five of you listening who have student loan debt. Check your mailbox because the bills are coming. The Trump administration started its push to resume collections on defaulted student loans yesterday, threatening the financial health of millions of borrowers whose loans have gone belly up. According to the education department, about 5 million people fall into this category, with most having not made a payment since the pandemic. Millions more sit on the brink of default as well. Restarting student debt payments has been a major push of the Trump administration. In direct contrast to the Biden administration who moved to forgive billions in loans. As to be expected, firing up collections and instituting penalties for not paying is going to be an unwelcome financial burden for lots of Americans, sapping spending at a time when consumer confidence is already at a multi year low. Credit scores are also under threat with a new report from TransUnion saying that borrowers who previously had excellent credit may see their scores dinged by as much as 171 points. What comes next? If you're one of those millions borrowers in default should have been notified by an email to contact the Education Department's default resolution group and take action like making payments or entering a repayment plan to avoid harsher penalties. If you don't, the government may garnish wages or withhold tax refunds and benefits. Neal, an ominous Monday announcement for the 42 million Americans with federal student loans.

[Neal Freyman]

This has been five years. Coming back when the pandemic started, the Trump administration paused student loan repayments and then Biden came in and delayed it nine times. So this was going until 2024 at the end of the election. So there was a big break given to people who had student loans for many years now they maybe forgot about as we're seeing with these high delinquency rates. And now finally the machinery completely has been turned on here on yesterday. And so a lot of people are getting a rude awakening with how much they owe.

[Toby Howell]

Yeah, a student loan borrower enters default once they're behind on payments for more than 270 days. So that is kind of the magic number here. That's where that 5 million people come from. But 4 million people are on the brink of reaching that. So, so as we move into the summer, because the last kind of on ramp period for getting rid of or for prolonging student loans was back in October 2024. So if you count forward, you start to realize that this summer is when that 270 day mark starts to hit, which is when you will see another flood of people kind of realizing that they were behind and or had defaulted on their student loan. So yeah, you start looking into the personal finance angle of this and a lot of people are saying, hey, I would love to pay it back but just I cannot right now. Like I do not make enough and they're going to start garnishing wages and they're going to start dinging my credit score. So it is a little bit of a moment of panic for millions of Americans out there as they try to figure out how to navigate like these murky waters ahead.

[Neal Freyman]

And if you're listening to this thinking, well, I don't know what's going on with my student loans. You can check a dashboard by logging into your account on the federal website student8studentaid.gov go to that website, check out, see how much you owe. Hopefully it's not that much, but yeah, check that out. Student aid.gov that will give you a snapshot of your student loan picture.

[Toby Howell]

Let's take a quick break and come back and talk about trucks.

[Neal Freyman]

Toby, you ever get served an ad that just makes no sense whatsoever?

[Toby Howell]

Yes, one particular platform thinks I'm obsessed with Faberge eggs.

[Neal Freyman]

Maybe because we keep talking about egg prices. That also proves that a lot of the time the best B2B marketing gets served to the wrong people.

[Toby Howell]

I have purchased over 17 Faberge eggs in the last two weeks.

[Neal Freyman]

I wow. Okay. Point is, LinkedIn has a network of over 1 billion professionals and over 130 million decision makers, which makes it stand out. From other ad purchases, you can target.

[Toby Howell]

Buyers by industry, title, company, you name it. Everyone and their mom is on LinkedIn.

[Neal Freyman]

So save money and target the right professionals with LinkedIn ads.

[Toby Howell]

LinkedIn will even give you a $100 credit on your next campaign, so you can try it yourself. Just go to LinkedIn.com mbd that's LinkedIn.com mbd Terms and conditions apply only on LinkedIn ads.

[Neal Freyman]

It's been a rainy spring here in New York, but summer is fast approaching.

[Toby Howell]

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[Neal Freyman]

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[Toby Howell]

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[Neal Freyman]

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[Toby Howell]

If you're driving on the stretch of road between Dallas and Houston and come across a semi truck don't do the pull the horn signal because chances are no one will be there to see it. Why might not there be anyone in the driver's seat? I'm going to tell you on this edition of Toby's Trends. Aurora Innovation is an autonomous trucking company that plans to start testing out totally driverless rides in the next few days. The test drives are part of the company's goal to remake a trucking industry in the US that is plagued by high driver turnover rates and rising costs. Jeff Farah, the CEO of the Autonomous Vehicle Industry association, told Axios. The federal government is saying we have to move 50% more freight by 2050, but there's a shortage of drivers. How do I solve this puzzle with more freight to move and less drivers to do it? Enter Aurora and at least 10 other companies that are working on developing driverless semi trucking tech. Most companies are planning to head to the Lone Star State to test their metal due to its good weather, popular freight routes and favorable regulatory policies. So seriously, keep your eyes peeled if you frequent I 45. The end goal of driverless trucks is to save some money and offset driver shortages. A McKinsey analysis showed that if you cut out driver salaries, fleet operators could slash operating costs per mile by as much as 42%. Savings like those have drawn the interests of companies like Uber Freight who recently conducted a test run with Aurora, albeit with safety drivers present. But now Aurora is going totally solo Dolo representing a big leap forward for the budding industry. Neil if any industry stands to benefit from from the push for autonomous driving, it is long haul trucking.

[Neal Freyman]

Pulitzer were the trend right there? No, it is true that this is a very attractive industry for automation and the big question is why didn't it happen faster? I mean, 10 years ago when you're looking at what would be automated first, you know, self driving cars in cities or trucks on long haul routes in rural areas on highways, you would probably pick the trucks first because it's a lot easier. They have point to point, you know exactly where they're going. And when it comes to cars in cities, if a person comes in and hails a Waymo Uber kind of deal, you don't know where they're going to go. There's a lot more traffic. So the expectation in this industry was that trucking would, you know, pull way ahead of the urban car apparatus. But it didn't. There was a lot of problems with regulation and the technology is hard, but now it looks like at least Aurora has one truck going on i45 and they're hoping to ramp that up soon. And it looks like, yeah, 10 other companies are working on this tech. And we'll see more autonomous trucks on the road in 2025 and 2026, which could match the hundreds of thousands of rides that are being given by Waymo in cities.

[Toby Howell]

And this is closer than we think because Aurora said that the self driving tech has completed over miles, albeit with a human controller sitting in the passenger seat. And the technology on these is a little bit different than self driving vehicles, mainly because it can see just so much further ahead down the road. These trucks are equipped with sensors that can see the length of over four football fields. So that is a big reason why they're trying to test it on these kind of long straight roads that you associate with long haul trucks and because you can see way out into the distance. But yeah, some of the issues that they've run into with unions is, is even just like safety things where normally when a truck breaks down, a human has to get out and put down these little barriers that show you that hey, there is a broken down truck here. Aurora was trying to push and other driverless tech companies were trying to push for having those lights be on the actual cab itself because obviously if there's no driver, then how could you put out that safety equipment? So that's just a microcosm of some of the regulatory battles that they are fighting and that are getting pushed back against the transportation. The transport workers union is pushing back against it because they say obviously they want to advocate for drivers. So some regulatory issues to, to still get over the hurdle. But clearly it looks like there's some, some good momentum on the autonomous driving trucking front. Now let's sprint to the finish with some final headlines. Skechers, the shoe company popular with nurses, pickleball players and middle schoolers, is getting acquired for nearly $10 billion. In a surprise move, the global investment firm 3G Capital swooped in to take the shoe company, which reported over two and a half billion dollars in sales in the first quarter of the year, private. Despite notching 7% sales growth. Skechers and the footwear industry as a whole has gotten flat tired by tariffs affecting imports from China and Vietnam, where Skechers manufactures most of its products. As such, the company recently withdrew its full year guidance. But 3G is betting that the sales momentum Skechers is showing is something that can hold up to macroeconomic pressure. While shareholders are thrilled that someone is buying the company for a nearly 30% premium, sending the stock soaring 25% yesterday. Looks like a win win here, Neal.

[Neal Freyman]

This is one of the biggest acquisitions ever in the footwear industry. Skechers has made some pretty interesting moves recently to get into the performance footwear market. They've signed Joel Embiid, they've signed Harry Kane, two superstar athletes. I was walking in the subway yesterday, I saw a million Skechers ads with Snoop Dogg. So they've signed some pretty A list names here to chart a path forward. But yes, a nice little payout for for Skechers executives right there and shareholders. In the staring contest between Sam Altman and Elon Musk, Altman blinked. The OpenAI CEO announced yesterday that the company would scrap its controversial plans to shed its nonprofit status. Instead, OpenAI will restructure as a public benefit corporation, letting the nonprofit keep its control of the AI leader. OpenAI, which Altman, Musk and others founded as a nonprofit, had been looking to dump its unusual governance structure to attract more investment. But the plan faced heated opposition from Musk, former employees and AI experts who worried the conversion would make it more focused on profits and not safety. The new organization, Altman said, sets us up to have a more understandable structure to do the things that a company like ours has to do.

[Toby Howell]

And there is billions of dollars on the line here, obviously, because a lot of the funding that OpenAI has received from investors like Soft Rank, we're contingent upon it ditching its nonprofit structure and going into a for profit entity. This isn't exactly that, but apparently it crosses the t's and dots the eyes. It still has to be approved by a variety of different state kind of attorneys generals between Delaware and California. But it does look like the big, you know, red arrow or red X that could have happened if they didn't, you know, change their corporate structure has been averted. So kind of a they're breathing a sigh of relief here, even if it's not exactly what you would expect from a corporate kind of rejiggering perspective here. Up next, President Trump posted on Sunday that he is directing multiple federal agencies to work together to rebuild and reopen the iconic and infamous Alcatraz prison in order to quote, house America's most ruthless and violent offenders. Alcatraz hasn't been open for 60 years now after shuttering due to high maintenance costs, the island fortress was about three times more expensive to operate than any other federal prison, according to its website. And in the years since, it has welcomed a lot more tourists than criminals. With approximately 1.2 million visitors stopping by every year to see the National Historic Landmark. So the president's plan to reopen the complex might be as hard to pull off as an escape from Alcatraz.

[Neal Freyman]

Except three people apparently did it. San Francisco locals are probably not so happy about this, because this is the one thing that they can take their family and friends to when they come into town. And I've done it before. It is a certainly a big tourist site in San Francisco. I like this plan that others have put forward. A Lady Liberty of the Pacific set of opening Alcatraz as a supermax prison. You construct this Statue of Liberty, like statue just for the West Coast. You have a beacon lamp in her right hand and a coiled fiber optic cable in her left representing Bay Area technology. So this got a lot of people thinking about what we could possibly do with Alcatraz besides reopen it.

[Toby Howell]

Well, my idea for Alcatraz is the triathlon, because leave it to endurance athletes to say, oh, supermass prison. Let's start a swimming event from there, which does happen to 2,000 people a year. You know, drive a ferry off, they dive in near Alcatraz, escape via swim, and then do the bike and run afterwards. So it's coming up May 31st on the calendar. So if you're interested, go check that out.

[Neal Freyman]

All right. Finally, Skype has gone on permanent mute. Yesterday, the service that let you video call anyone in the world for free was officially shut down after a legendary 23 year run. Microsoft, which bought Skype for $8.5 billion in 2011, is encouraging users to migrate to teams instead. Which is kind of like telling everyone at your awesome house party to leave for an underwhelming bar. Skype will hopefully become friends with AIM and Vine in millennial app Heaven Bar.

[Toby Howell]

Went out for Skype. It blew a 3:1 lead. It just missed its moment. During the 2020 pandemic, Zoom usage exploded 30x over it's 30 times. But Skype didn't see any spike. And actually, the App went from 40 million users in 2020 to 36 million in 2023. It was, you know, that eponym, before zoom was even a thing used to say, I Skype people. Now you say, I zoom people. So we've already kind of given its laurels before on the show, but, you know, yesterday being its last day was a sad day, especially because we're never going to hear that. Boo. Bloop, bloop, bloop.

[Neal Freyman]

Okay, I'm sorry, I'm cutting you off right now. Let's wrap it up there. Thanks so much for starting your morning with us and have a wonderful Tuesday. If you have any thoughts on the show, you should definitely reach out. Send an email with any questions, comments or feedback to Morning Brew daily at Morning Broadcom. Let's roll the credits. Emily Milian is our Executive producer. Raymond Liu is our producer. Our associate producers are Olivia Graham and Olivia Lake. Scoopstar Darris is on audio, hair and makeup is taking well deserved PTO after the Met Gala. Devin Emery is our President and our show is a production of Morning Brew.

[Toby Howell]

Great show today Neil. Let's run it back tomorrow.