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Trump's Tariff Reveal Escalates Trade War & Tesla Sales Drop 13%
00:32:37
What new tariffs will mean for the economy and Tesla is on the struggle bus
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- [00:00]
Toby Howell
Hey, Fidelity. How can I remember to invest every month?
- [00:05]
Neal Freyman
With the Fidelity app, you can choose a schedule and set up recurring investments in stocks and ETFs.
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Toby Howell
Huh, that sounds easier than I thought.
- [00:14]
Neal Freyman
You got this?
- [00:15]
Malcolm Gladwell
Yeah, I do. Now, where did I put my keys?
- [00:19]
Neal Freyman
You will find them where you left them.
- [00:23]
Toby Howell
Investing involves risk, including risk of loss. Fidelity Brokerage Services, llc. Member NYSE SIPC.
- [00:32]
Malcolm Gladwell
Good morning, Brew Daily Show. I'm Neal Freyman.
- [00:35]
Toby Howell
And I'm Toby Howell.
- [00:36]
Malcolm Gladwell
Today, stocks are tumbling and businesses are scrambling after President Trump announced sweeping tariffs on Liberation Day.
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Toby Howell
Then The Nintendo Switch 2 was unveiled and it cost nearly the same as an Xbox. It's Thursday, April 3rd. Let's ride.
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Malcolm Gladwell
So much news to get to today. But first, some random fun facts. Got to get that brain stretched out in the morning before putting it to work. A few days ago, an X user posted. Does anyone have any random fun facts about a very niche subject? And people delivered with great tidbits like crickets are actually tiny thermometers because their chirp count correlates to the temperature. Or the Earth actually takes 365 days and six hours to orbit the sun, hence a leap year every four years. Toby, you got any other fun facts?
- [01:27]
Toby Howell
Well, first of all, some of these viral answers you definitely had to fact check in community Notes was having a field day. So that's why the first fact I picked came from Encyclopedia Britannica. And they said October 31, 2000 was the last time all of humanity was on earth. Since then, there's always been at least one person in space. So commit that to to memory to use at cocktail parties. And the next one is just more of a tip. And that's from user what's up Caramel? And her tip was Barilla Pasta has a Spotify playlist. Each playlist is the exact length of cook time for for the varieties of pasta. Press play, drop the noodles. Music stops Al dente noodles, which honestly is a very helpful fact and it's way more fun than a kitchen timer. So, yeah, these are just stuff that you can drop. Say you claimed them from morning brew daily or just, you know, say that you came up with them yourself. But very good small talk alternatives to saying what's going on with the weather these days. Now, a word from our sponsor, Taxact. Neil, you ever feel like doing your taxes is like trying to read a foreign language?
- [02:28]
Malcolm Gladwell
I mean, I wouldn't say a foreign foreign language, but sure, it can be complicated.
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Toby Howell
No, I mean, I was literally staring at a form yesterday thinking this might as well be ancient Greek. Which, to be clear, I do not speak.
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Malcolm Gladwell
It doesn't have to be all Greek to you. Taxact actually makes your taxes simple. They walk you through everything step by step, whether you're filing individually or bundling with your small business.
- [02:47]
Toby Howell
What if I get something wrong? What if the IRS shows up at my door? What if Zeus smites me?
- [02:53]
Malcolm Gladwell
First of all, relax. Second, every return is backed with an accuracy guarantee so you can file with confidence.
- [02:59]
Toby Howell
Oh, I do like confidence. That is a language I do speak.
- [03:02]
Malcolm Gladwell
File smarter, not harder. @taxact.com before the April 15 deadline, I went to Liberation Day and all I got was this global Trade war. In a speech at the Rose Garden yesterday afternoon, President Trump took a stick of dynamite to the long standing global economic system centered on free trade. He announced a minimum 10% tariff on all exports to the United States, plus much higher reciprocal rates on countries. He said maintain unfair trade barriers on American products. Reciprocal. That means they do it to us and we do it to them. Very simple. Can't get any simpler than that, trump said, holding up a chart with a list of countries and percentages. Trump ran down the list and revealed how much the US Would now be tariffing each one to name a few big ones Japan 24%, South Korea 25%, the EU 20% and other eye watering amounts like 54% on China, which is 34% on top of the existing 20%. The President said this was a discounted reciprocal tariff on other countries because he's kind. Trump argues the tariffs will usher in a, quote, golden age of America because companies will begin to build factories in the United States to avoid the tariffs. He cited multibillion dollar announcements from Companies like Apple, SoftBank and Taiwan Semiconductors since his election as evidence this plan was working. Economists see universal tariffs much differently, arguing they slow economic growth, cause uncertainty for businesses and cause a spike in inflation. Remember, a tariff is a tax paid by the importer of a foreign product, say Target importing bedsheets. Maybe Target will eat some of the tax, even if it eats their profits. But studies show that often that tax is passed along to the consumer in the form of higher prices. Tell me the White House kept these tariff rates under wraps until Trump's announcement. And of all the scenarios investors had considered, this was about the worst case. Dow futures are down more than 1,000 points currently, the S&P is down nearly 3% and the NASDAQ more than 3%.
- [05:03]
Toby Howell
Let's dive into a little bit about how these rates were calculated. I'm going to Use Lesotho here as an example. It's a country with a GDP of just $2.4 billion. Half of its population lives on less than $4 a day. So Lesotho is being hit with a 50% tariff under Trump's trade plan that is the highest of any country. And it's not because they actually impose high tariffs on the U.S. they do not. But you get that number by taking the nation's trade deficit with us and dividing it by the Nation's exports to us. In Lesotho's case, they export $236 million of goods. We send them just $7 million. So the trade deficit there is 229 million. You divide that by their total imports and that you get 97%. That's the tariff Lesotho is deemed to charge the US with. And so half of that, because, you know, Trump said he was being lenient, is roughly 50%. And that's what the US is reciprocating with. So why is there a gap there in the first place? That is what you have to dive into here. Not because they don't really like US Goods. Again, they're not a rich nation, so they cannot buy things we make, like Teslas. And as for the other goal of tariffs to bring manufacturing back home, diamonds are Lesotho's top export. So we can't really reshore diamond manufacturing here in the US because they there are no diamonds here. So that is just one instance that provides a microcosm as to why economists may be scratching their heads here, is because the manner in which that these were calculated, which is taking the nation's trade deficit with us divided by the nation's exports to us and cutting it in half, seems to be a little bit imprecise.
- [06:35]
Malcolm Gladwell
And let's dive into some other countries that are getting hit with tariffs, like, at much higher levels than others. One nation that a lot of people were looking to and raising their eyebrows was Vietnam. So Vietnam is going to have a 46% duty on imports from to the United States on their exports to the United States. And, you know, Vietnam was a huge winner of Trump's first trade war on China, because when those tariffs went on on China in 2018, so many manufacturers, apparel makers, electronics makers, set up shop in Vietnam because there were low tariff rates on Vietnam and started shipping their products to the United States. So Vietnam's economy was one of the fastest growing in the world. Now they're getting hit with a 46% tariff, and all of those companies that had moved all of their operations or More of their operations to Vietnam are getting whacked on the stock market this morning. Nike manufactures 25% of its footwear now in Vietnam. You know, over the past few years, its stock is down 8%. Deckers, which is the owner of Ugg and, and hoka, is down 10%. Restoration Hardware, a ton of furniture makers expanded their operations in Vietnam over the past few years. Restoration hardware is down 26%. So if you go down the line from furniture makers, toy makers, apparel makers, their stocks are getting crushed this morning specifically because of those very high tariff rates on Vietnam.
- [07:58]
Toby Howell
And I think one of the reasons why this trade war is harder to navigate than the last one is the fact that if you're a business, you don't know where to put up your manufacturing. And last time when it was mostly China. Focus. You are right. You could go to Vietnam and that's where you could feel confident about investing in your production there. But right now, it's a little bit unclear where to invest. Obviously, Trump says invest in America, but that takes a while to spin up manufacturing, actually a long time to spin up manufacturing in the United States. So while this uncertainty is hanging in the air, a lot of people end up waiting and not making those investments, which, you know, leads to demand falling as well, which could end up impacting the economy in a, in a global economy in a broader way. So that uncertainty that this injects is one of the reasons why economists love to push back on tariffs. Because you need to be able to plan 1, 5, 10 years down the future if you are a business.
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Malcolm Gladwell
Yeah. The big picture from this announcement, according to analysts and banks who are digesting all of this information, is this is a massive shock to the economy. JP Morgan put out this note last night as the information was rolling out that was widely shared. And here were their main points. This. These tariffs raised just under $400 billion in revenue, which would be the largest tax increase since 1968. The tariffs would boost consumer prices by 1 to 1.5% this year. The hit to purchasing power could take real disposable personal income growth into negative territory by the end of the year and also send consumer spending into negativity. To quote JP Morgan here, this impact alone could take the economists could take the economy perilously close to slipping into a recession. So we are waiting for these tariffs to come into effect. The auto tariffs are coming into effect today, 25% on foreign vehicles. The tariffs that were announced yesterday, the reciprocal ones, are going into effect April 9th about a week from now. And you can be sure that the phones are going to be ringing off the hook in the White House as other countries think about retaliating in response to these reciprocal tariffs or try to cut deals with the Trump administration to lower these plan tariffs.
- [10:06]
Toby Howell
Tesla dropped its delivery numbers yesterday, and they literally dropped. The EV maker reported double digit shrinkage in the first quarter as it faced everything from increased competition to political blowback against Elon Musk. Tesla delivered just over 336,000 vehicles in Q1, good for a 13% decline from the previous year and its sharpest year over year decline since the pandemic. It was also the fewest number of deliveries for Tesla in any quarter, dating back to 2022. The figure looks even worse when you realize that other parts of the auto industry are chugging along quite nicely. Tesla's Chinese nemesis BYD, saw its annual sales jump 60% in the first quarter, while domestic rival GM reported 17% sales growth. Even the notoriously bullish Tesla analyst Dan Ives struck a more somber tone when covering the numbers. We are not going to look at these numbers with rose colored glasses. They were a disaster on every metric, he wrote. He then offered his advice for how to stop the bleeding. And that is Musk needs to stop this political firestorm and balance being CEO of Tesla with Doge. Luckily for Tesla investors, it looks like that day may be coming sooner rather than later. Politico reported that President Trump told his inner circle that Musk was on his way out, which helped the stock climb out of the hole its delivery numbers created. But then Trump's Rose Garden tariff announcement sent the stock down again in after hours trading. So snip snap, Neal. Snip snap.
- [11:34]
Malcolm Gladwell
We kind of saw this coming because early reports from around the world showed Tesla sales falling off a cliff in Australia. In Germany, they, they declined more than 70% in February. In China, it's a key market, second biggest market. Sales were down 11.5% in March from last year, and the US sales were down 2% in the first two months of the year. In California, they were down. Another big market, they were down 12% last year. So the writing was on the wall. These drip, this drip of bad news, you know, all these protests that were going on, we knew this number was going to be bad for the first three months of the year, but it was worse than expected. And it shows the number of challenges that Tesla has, from Elon Musk down to an aging vehicle lineup and, you know, a very slow pivot to autonomous cars, which is where its valuation is mostly Based right now.
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Toby Howell
Yeah. Dan Ives called it a brand crisis at Tesla right now. Some analysts estimated that Tesla lost about 80,000 potential deliveries because of, quote, brand damage. And a lot of that was actually related to damage coming to Tesla shops and charging stations. There was protests outside 90 or so shops and stations last month. There's been a dozen or so violent acts directed at Tesla facilities as well. You know, protesters have been throwing Molotov cocktails in some instances at it. So there's definitely been a lot of pushback there. And you're right, it was telegraphed a little bit because Europe essentially has gone on strike against Tesla. Sales in Germany are falling, France are falling. So it's definitely been one thing after the other impacting this company. And it wasn't like these delivery numbers were ever going to be good, but they were a little bit worse than a lot of people were expecting.
- [13:13]
Malcolm Gladwell
So what could Tesla do to turn things around? Well, this summer there could be two big announcements that could rev it back up to growth. There's a June deadline for these two big announcements. One is the production of a more affordable Tesla. Investors have been waiting for this for years so that it can compete with, it can compete with BYD, but also legacy carmakers that are rolling out new EVs at a much cheaper price point than what Tesla sells for. So one is the affordable car. The other is this robotaxi service that Tesla has said it will launch in June in its backyard of Austin. Waymo is already working there and offering robo taxi rides in Austin right in its backyard. Tesla is playing catch up, but it's hoping that during the summer it will have these new announcements to roll out. Plus a refreshed Model Y, which some analysts say was a reason for these, these bad delivery numbers.
- [14:07]
Toby Howell
Let's move on. A small device with very big shoes to fill was unveiled yesterday as Nintendo pulled the curtain back on its new Switch to console. It's the follow up act the original Switch, which introduced the mega successful hybrid console concept eight years ago. But like Oceans 12 proved it's very hard to create a worthy sequel when the original is so beloved. The Switch 2 will launch in early June for 450 bucks, a $150 jump from the first generation model. And that extra 150 will get you a few new features, including a game chat function that will let you curse out your opponents in Mario Kart, as well as a camera function that shows your face when you spew those expletives. It's those feature along with some beefed up hardware that gives it a bigger screen and more storage that Nintendo is hoping will convince fans that the gameplay experience will be differentiated enough to make the upgrade, which is going to be a tough ask because the Original is the third best selling gaming console of all time. It sold roughly 150 million units since it launched back in 2017. And it's not like Nintendo has always nailed its follow up acts. It sold over 100 million wheeze but followed that up with just 13 million sales of the Wii U. This time around, it's trying to avoid that drop off, positioning the Switch 2 as a direct follow up to the original instead of mixing things up, but by playing it safe. Neil it's also taking a bit of a risk because now you're asking consumers to fork up more money for what is essentially a revamped version of its current console.
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Malcolm Gladwell
Investor analysts generally think that Nintendo stuck the landing a la Simone Biles with this particular launch because it's doing it in conjunction with this new Mario Kart game. In this One analyst from the research firm OMD says that Nintendo will sell 14.7 million of the new Switch 2 consoles this year, which would easily top the sales of the original Switch for its first year, which was 13 million. And it's going to be even with the higher price tag of $450 because of Mario Kart World, it's going to come in this package for a little bit of an upsell with Switch. Mario Kart 8 Deluxe was owned by half of all Switch users. This is an insanely popular game. This was the talk of the town yesterday after this was released. So I think this game, at least according to analysts, is going to, you know, allow the switch 2 to maybe even leapfrog its predecessor.
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Toby Howell
There are a lot more challenges this time around though. The gaming landscape is a lot different. One, there's tariffs on Chinese goods that could impact, you know, the production, the shipping costs, impact everything. Also, there's a lot more competition from mobile games now than when the Switch originally launched. And then there's also just this, a lot of pressure to live up to its predecessor. The Switch being so successful is a double edged sword because now everyone is going to compare it to that gaming console that was so beloved. So usually Nintendo gets around these by designing a whole new form function. When they're releasing follow up consoles like the Wii and Wii U were completely different devices. This time they're trying to learn from those mistakes, but also they might be making a M because they're basically copying and pasting the original one with a few new tweaks. So there's definitely some question marks hanging around this, even though there does seem to be a lot of support and a lot of, you know, people willing to shell out that extra $150 to to buy and upgrade this. The switch to up next, let's talk about some fun numbers, and that is coming from Neil Neal what's one way you rely on tech in your everyday life?
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Malcolm Gladwell
I got a lot of health tracking apps running constantly to let me body's holding up.
- [17:42]
Toby Howell
Technology can help us optimize some of life's most basic tasks. We've even got tech to help us brush our teeth.
- [17:48]
Malcolm Gladwell
The Quip Ultra is a smartsonic electric toothbrush that's packed full of some pretty cool tech you'll want to use daily.
- [17:54]
Toby Howell
It has a dynamic LED touch bar that lets you choose between 16 different brushing intensities from sensitive to deep clean for up to 15 times more plaque removal versus a manual toothbrush.
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Malcolm Gladwell
And it's equipped with a timer that monitors your progress and your pressure to help you brush at just the right intensity.
- [18:12]
Toby Howell
You can even pair your Quip Ultra to the Quip app on your phone to get a personalized look at your oral health.
- [18:18]
Malcolm Gladwell
Still brushing the analog way. Get 15% off your Quip Ultra at getquip.com/brew and subscribe for auto shipping of Brush Pod refill heads to earn exclusive perks. That's G E T Q U I p.com/brew if you're trying to elevate your.
- [18:36]
Toby Howell
Style, it's all about tailoring, and Theory's Motion Wool takes tailoring to a new level with premium, expertly engineered Italian wool.
- [18:44]
Malcolm Gladwell
Theory is known for creating collections with exceptional fit, innovative fabrics, and enduring styles. Now they're doing it again with Motion Wool.
- [18:51]
Toby Howell
Motion Wool's one of a kind. Fabrication is where form meets function. It's breathable, wrinkle resistant, and machine washable so you can head from the office to happy hour to date night.
- [19:01]
Malcolm Gladwell
Whether you've got a long day of meetings or you're packing for a long haul flight, Motion Wool is made to move with you. It's also designed to keep its shape over time so you can keep arriving in style.
- [19:11]
Toby Howell
Step up your wardrobe with Motion wool. Head to theory.com/morning brew to get started. That's theory.com/morning brew.
- [19:22]
Malcolm Gladwell
Welcome to Neil's Numbers, the segment where I share three stats from the week's news that will get you to God's country. My first number is 5%, which is the share of all avocados consumed in the US bought by Chipotle. That's 143 million pounds of avocados used across its 3,700 locations each year. But when you buy 5% of the US's avocados and the vast majority of them come from a single country, Mexico, you need to diversify your supplier base, because being that concentrated is bad. Not only are you at the mercy of the weather in a single area, but Mexico has also been a frequent target of US tariffs that could raise prices. According to the Wall Street Journal, Chipotle started this diversification process seven years ago, scouring the globe for other sources of avocados besides Mexico, which had accounted for 85% of its avocados. The US is one option, but we don't make nearly enough of the fruit to fulfill Chipotle's demands. So they started scooping up avocados from farms in Peru, the Dominican Republic, Brazil, Guatemala, and Colombia, transforming local economies along the way. Now, after years of building a new food supply line, Chipotle has reduced its reliance on Mexican avocados to just 50% from 85%. But diversification also brings a number of new challenges.
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Toby Howell
Yeah, some of the challenges are Chipotle is very particular about which avocados they use. They love hass avocados, which are a lot fattier. They have more fuller flavor. So you can't necessarily use some of those avocados native to Central and South American countries, which usually have a lower oil and less and a more muted flavor. And also, when you diversify your avocado source, you create a lot of challenges within Chipotle kitchens themselves, because Peruvian and Colombia avocados have different shades than the ones that come from Mexico and California. So that leads to a differing experience for customers who are looking at the shade of the avocado. I definitely do this when I go into Chipotle. I go, is this like. Is this looking like a fresh batch, or is this looking like a little too oxidized and aged right now? And I make my decision if I want to upgrade for that guac based on how it looks, and especially so Chipotle knows this. So they've really kept their staff educated and updated on how to deal with various species of avocado. Just a very fascinating supply chain issue, all the way from where you source it from to how you present it at the restaurants themselves.
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Malcolm Gladwell
And it's super critical because about half of all Chipotle customers order guacamole every time they go in which is a lot higher share than I was expecting for my next number. You might consider yourself a fan of a musical artist or an athlete, but I can guarantee that the fans in Japan go harder than you. According to a survey by two Tokyo marketing firms, 11% of Japan's population engage in Oshi katsu, a term describing activities that support their favorite celebs, mascots, anime characters, and vtubers or virtual YouTubers. In most cases, showing love for your idol involves spending money. According to Reuters, respondents in the survey spent an average of $1700 per year on Oshi Katsu, equivalent to a $23 billion annual influx of consumer spending into the world's fourth largest economy. That's just 2.1% of Japan's total annual sales each year, but it's a share that is increasing. And the sector has even caught the eye of economists and the bank of Japan, who are looking for any areas of growth to stimulate lackluster spending. So how does one engage in Oshikatsu? What are they actually spending money on? Well, merch for one, but also things like buying ad space as a gift for your hero on their birthday. Or in another case, a woman went to a Tokyo cafe to sit in the same seat where a member of a boy band she loved once visited and created a shrine to him for a photo op. Toby Oshikatsu is a force in the Japanese economy.
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Toby Howell
It's absolutely a force. I mean, when I read that people were just going to places to sit in chairs that their oshis went to, that was kind of mind blowing to me. That's a fandom even beyond what the swifties do here in America. But this is an absolute economic force that is here to stay. It definitely gained some speed during the pandemic, but the bank of Japan is referencing it because they're like, this is a legitimate driver of consumption in our economy right now. Is this is especially good to note because right now it looks like Japan's in line for some very big pay raises. 20 somethings will probably receive a very large raise in come springtime. And obviously, you know, the economic authorities want to know where that money is going to go. And it looks like a fair amount. $23 billion is not nothing. It's not the biggest part of the economy, but it's also not the smallest part. So Oshi Katsu is definitely something that is an economic force, which sounds kind of crazy to say, but, you know, it absolutely is a driver of spending in that country.
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Malcolm Gladwell
For my final number, the leaders of the world's largest atom smasher have dreamed up a new atom smasher that is going to smash the current one two bits. The top nerds at cern, the European Organization for Nuclear Research, release the blueprints for a project a decade in the making. A new particle collider that will eventually replace the Large Hadron Collider, a network of magnets used to smash particles against one another at velocities approaching the speed of light in order to unlock the mysteries of the universe. Okay, let's get to the numbers. Sorry for the wait. The future circular collider, the new smasher will be a 56.5 mile loop below Lake Geneva on the French, French Swiss border, with tunnels 16ft in diameter and buried 656ft below ground. For comparison, the Large Hadrian Collider, the current one, is just 17 miles around, so the new one is going to be at least three times as big. CERN says the future circular collider will be the quote, most extraordinary instrument ever built by humanity to study the constituents and the laws of nature at the most fundamental levels. But the most extraordinary instrument ever built by humanity doesn't come cheap. It'll cost $17 billion to construct, and even if funding is secured, they won't start smashing atoms until 2046.
- [25:21]
Toby Howell
There is this meme of just one more collider. Bro, I just need one more. Just give me 20 billion more and I'll solve antimatter, we promise. And it looks like Stern is kind of playing that out in real time. 56 mile loop is hard to comprehend underground too. Of course this price tag is going to be very big. And of course, it's gotten some pushback as well. A lot of scientists and physicists believe that maybe this money could be allocated better towards smaller and cheaper colliders. Also, the timeline is just ridiculous. It won't come online fully until, you know, 2070s, which is kind of crazy to think about. So a lot of members of the scientific community are looking at it and saying, you're basically just saddling the physics world with a 70 year mortgage payment to kind of work out through. So those, those are people I don't.
- [26:08]
Malcolm Gladwell
Want coming to my party.
- [26:09]
Toby Howell
That's true. But also, they have a collider.
- [26:11]
Malcolm Gladwell
Let's go.
- [26:11]
Toby Howell
I know big colliders is pretty fun, and I do. I mean, Higgs boson was discovered by CERN back a decade plus a go, so who knows what, you know, this new collider might unveil. Now let's sprint to the finish with some final headlines. That you may have missed up first if you thought your online shopping experience didn't have enough. Benson Boon Edits Amazon is looking to rectify that oversight. The e comm giant has reportedly made a last minute bid to acquire TikTok. The offer comes as TikTok faces a April 5 deadline to divest from its Chinese ownership or risk a ban in the US Amazon's interest in TikTok makes a lot of sense. TikTok wields significant influence on social commerce these days, with nearly half of US Users making purchases influenced by the platform. However, sources indicate that people on TikTok side are not really taking Amazon's bid seriously, meaning this might be more of a Hail Mary on Amazon side rather than a major e commerce tie up. Still, April 5th is in two days, Neal, so you never know what will happen.
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Malcolm Gladwell
We have no idea. The clock is ticking. Trump could extend the deadline a little bit more, but of course all of this TikTok sales contingent on a blessing from Beijing and from what was announced yesterday. With Liberation day and the 54% tariffs on China, it is very clear that TikTok sale or whatever happens to TikTok is just going to be part of a larger negotiation around trade. So TikTok's fate is intertwined with the trade war. Maybe Mark Zuckerberg was expensing all of his trips to UFC fights all along. Yesterday, Metta inked a multimillion dollar, multi year partnership with UFC to become the quote, official fan technology partner of the mixed martial arts league he adores. It's essentially a sponsorship deal that will result in UFC integrating with Metta across its portfolio of products including meta glasses, WhatsApp threads, Instagram, Facebook and Meta Quest. You'll also see meta branding featured in UFC Octagons for pay per View and Fight Night events. In a statement to cnbc, Zuckerberg, an avid mma, said, I love this sport and I'm looking forward to working with UFC to let fans experience it in new ways.
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Toby Howell
Yeah, we absolutely could have seen this one coming. Zuckerberg has been very vocal about his love for UFC and him and Dana White have been growing closer. Dana White is now on Met as a board and also one other thing to note here is that the UFC meteorites are coming up soon. Those their current partner ESPN has their negotiating window open April 15th. It doesn't look like they're going to renew that deal, so inking this very large deal right ahead of negotiations is just another win for ufc. It's another come up because now they have this. You know very large and deep pocketed sponsor to go along with negotiating for for new media rights. Finally, Coastal Carolina football fans are probably more excited for this year's football season than any other program. Not because they suddenly found Tom Brady's heir, apparently, but because the school is starting an initiative that allows ticket holders to grab up to four items per concession stand visit completely for free. Yes, the CCU kickoff meal deal lets you get hot dogs, popcorn, fountain drinks, you name it, for $0. And there's no limit on the number of visits you can make in a game. Average attendance at Coastal Carolina football Games was about 21,000 during the 2024 season. And while it was hard to break out specific concessions revenue in the athletic department's annual financial report, estimates put the figure at around $250,000 per game. So that is a lot of money. It is forgoing. But Neal, before you abandon your Maryland Terrapins to become a Chanticleer fan, the program excludes alcoholic beverages. Still not a bad deal though.
- [29:51]
Malcolm Gladwell
I was looking for flights to Myrtle beach yesterday because they they play in Conway, South Carolina, which is just a 50 minute drive to Myrtle Beach. And I think I'm not the only one. You know, this is a great promotion that got Coastal Carolina on a lot of people's radar and you know, hopefully builds long term loyalty with their fans. Yes, they're going to eat a couple million dollars throughout the football season, but they're hoping that leads to long term success. I mean, this sounds like the best football game ever to go to.
- [30:16]
Toby Howell
I mean, the fact that you can make a multiple visits to. There's not a lot of asterisks. It is good that they're excluding alcohol because that would just be too far. But yeah, I think what a way to, you know, incur some goodwill among your fan base to say, hey, have some popcorn. Have some hot dogs for free.
- [30:32]
Malcolm Gladwell
Have a lot of popcorn. Okay, let's wrap it up there. Thanks so much for starting your morning with us and have a wonderful Thursday. For any questions, comments or feedback, send an email to Morning Brew daily at Morning Broadcom. Let's roll the credits. Emily Milian is our executive producer. Raymond Lu is our producer. Olivia Graham and Olivia Lake are our associate producers. You know what? Oh is our technical director. Scoop Stardaris is on audio, hair and makeup. Would love to be invited to your Mario Kart party. Devin Emery is our chief content officer and our show is a production of Morning Brew.
- [31:02]
Toby Howell
Great show today, Neil. Let's run it back tomorrow.
- [31:11]
Neal Freyman
What does the heartbreaking fate of the Cheetah. Tell us about the way we raise our children. Why was Los Angeles the bank robbery capital of the world? What exactly happened in the Marriott Hotel in downtown Boston in March of 2020? I'm Malcolm Gladwell in my new audiobook, Revenge of the Tipping Point. I'm looking at these questions and exploring the dark side of contagious phenomenon. You can hear a sneak peek of the audiobook on my podcast, Revisionist History. Listen on the iHeartRadio app, Apple Podcasts, or wherever you listen to podcasts.