Ford CEO Takes On Tesla. Plus, Office REIT Outlook.

Data is everywhere, but is it ready for consumption? Morningstar developed the language of global investment data so you have the right ingredients to help you shine. Morningstar, where data speaks. You know, we are designing our second cycle product in the EV space that will be coming out next couple years. I think it'll be fully competitive with Tesla on a cost basis. You know, but they're really good. They're really good competitor. We're number 2 in the US and we want to continue to grow from, say, 20,000 a month now of production to, you know, 50 by the end of this year.

Hello and welcome to the Barron's StreetWise podcast. I'm Jack Howe. The voice you just heard is Jim Farley. He's the CEO of Ford, which will soon host a day of presentations for investors. I spoke with Jim a week or so ago, and in a moment we'll hear his thoughts on autonomous driving, where we are in the auto demand cycle, and how to compete with Tesla. We'll also talk a bit about workers slow-footing it back to the office and what that means for real estate investment trusts. Listening in is our audio producer Meta. Hi, Meta.

Hi, Jack.

Something is different. About you and about me. Very exciting. Do you want to be the one to tell people what's going on? What's different? We are sitting in a room with a proximity of 3 feet. 3 feet. For the first time ever on this podcast, we're sitting in the same place. We are back in the office. How do I look, first of all? And I want you to be completely dishonest with listeners. You look amazing. Thank you. I have been working out. Thank you. We happen to have a listener question, which is kind of on this subject. Should we play that? Let's do it.

Hey, Jack, this is Davey Friedman from Seattle. And hi, Meta, big fan of the show. Okay, here's my question. It seems like a very painful, very volatile time in the office market right now. And I'd love your opinion on how this could impact commercial real estate investors. Who do you think will be the winners and losers from all the change that's happening in the office market? And is there an opportunity for smaller everyday investors? Thanks.

Thank you, Davey, for your excellent and timely question. This has been on people's minds since the beginning of the pandemic, really. And I think we've reached a point where we've seen enough and gathered enough data to come to some near-term conclusions about how people might behave and what it might mean for commercial real estate. There's a study just out from a research group called Placer.ai, and it talks about the new hybrid normal. Let me read a few lines from it. It says, return to office mandates seem to be everywhere. With the pandemic squarely in the rearview mirror, a growing number of companies are cracking down on fully remote work. But hype notwithstanding, few workplaces are demanding that people show up in person 5 days a week. Our friends at the Wall Street Journal wrote about that this past week, citing that study and other sources. The story was titled "The Return to the Office Has Stalled." It says that office usage had reached more than 50% back in January, but it hasn't pushed much higher since. One source in that story said that the companies requiring employees to be back in the office full-time, that percentage has actually declined. To 42% from 49% 3 months ago. Among workers at companies with hybrid work strategies, the average number of days they go into the office is 2.5. And it has a chart of the days that workers like to go into the office. And it appears like the new Monday through Friday is a Tuesday through Thursday. This is a sensitive subject. People have passionate views on both sides of the merits of workers going back to the office. Office full-time, most of the time, what have you. We're going to put those views aside and focus on the investment implications. And if you're an ordinary investor, that probably doesn't mean buying an office building at a beaten-down price, but it might mean buying a REIT. REIT stands for real estate investment trust. And Davey, I think this is what you were talking about when you mentioned everyday investors. Real estate investment trusts buy property and collect rents and pass that along to shareholders as dividends. And some of them specialize in office buildings. And you won't be surprised to learn that shares of REITs like that have been hit pretty hard lately. Boston Properties, that's ticker BXP, that's down 60% so far this year. The dividend yield, of course, gets higher as the share price falls, so it's now 8.3%. Here's another even more extreme example. It's called SL Green Realty, ticker SLG. That one's down 71% so far this year, and the dividend yield is over 15%. That's quite a dividend, right? Yeah, it's humongous. When you see one that high, it makes you think, is there something wrong here? Is this a dividend payment that's about to be cut, and therefore I shouldn't rely on a percentage as high? And in the case of SL Green, it already did recently cut its dividend. It's just that the share price is down so much that the new yield is that high even on the reduced dividend. We'll see what happens to that dividend. So as you can imagine, one type of investor might be saying, office REITs, this is a terrible time for that. Why on earth would I buy something like that? And another investor might say, you know what, I think the worst is priced in here. The outlook is so gloomy and these shares look so cheap and the dividend yields look so high that even considering the risk that landlords in the future can't collect all the rent they had hoped for and the dividends have to be cut, I still think long term I'll make out okay. So the question is, are there opportunities in office REITs? And for a fresh take on that question, I reached out to John Peterson. He's the head of the US REIT team at Jefferies. We had a question from someone who just basically wants to know what's the situation with going back to the office. It seems like there's a lot of strain on these landlords, and we could see how that would be harmful for some of these office REITs. But might it be the case that it's so bad it's good? Are there opportunities out there? Are there any shares that you see in that space that are so beaten down that they're attractive, or is it best to just stay away?

For now, we're definitely in the camp of it's probably best to stay away, but that doesn't mean that the asset class is broken forever. I mean, basically what happened is if you think about the supply and demand curve, right, the pandemic just shifted the demand curve down and the supply stayed the same.

John says that small and mid-sized businesses especially have gone in the direction of allowing for more remote work and even giving up their office space. In a lot of major markets in the US, vacancies are 15 to 20%. The market has to adjust for that and it won't be quick.

It's hard to invest in these stocks right now because it's going to take a lot of years to either grow into all of this excess supply or take that excess supply off the market and turn it into something else. In terms of the individual REITs, we don't have any buy ratings across any of the office REITs we cover right now. I think a lot of these companies have Some of them have balance sheet issues which they need to work through.

In addition to the vacancies, are there a lot of companies that are negotiating their rents lower?

Yeah, for sure. I mean, I think that the face rents have stayed about the same. What you're seeing is a lot of additional incentives like offering more months of free rent in the beginning or a larger, what they call a tenant improvement allowance. Most office space you go in, when a new tenant moves in, you kind of demolish the entire existing space and build it to the specifications of whoever's moving in there. So one thing that landlords can do is give them a larger allowance, kind of a piggy bank that they can use to make like even nicer office space. And by the way, just kind of as a bit of a tangent, I do think that's absolutely a trend that is encouraging that we've seen in the office space, that companies that want their employees to come into the office are investing more in their office space. JPMorgan's building a nice large tall tower here in Manhattan in Hudson Yards and just all across the country, actually tends to get leased fairly well because companies that want their employees to come in can say like, "Hey, we've got this really nice shiny office space." It kind of gets into the other point that a lot of the risk is kind of the more Class B type product that's 40, 50 years old that maybe 10, 15 years ago we would've called Class A, but today just feels like it's a level down from where it used to be.

You mentioned the possibility of turning some of that space into residential space. Are we likely to see that? Is that a good idea?

It's doable, but it's expensive. Well, I'll give you a few examples. So after 9/11 in the financial district, there was a lot of larger, bold office buildings that were converted into residential successfully. One of the reasons that it worked down there is because if you've been in the financial district—

It used to be a ghost town after hours, after work, and then all of a sudden it was like sidewalk cafes. It turned residential.

Exactly. It turned residential. But the reason that it works is because they're smaller streets. And so the floor plates of each building are smaller. And so that's one of the issues with some of these large office buildings in Midtown Manhattan. You have these big expansive spaces, and if you start cutting it up with apartments, you end up having a window problem. The plumbing is also very difficult.

So John says there might be an opportunity in office REITs down the road, but for now it's best to watch and see what happens. And he makes a comparison with mall REITs. Malls, of course, have been hit hard by store closures.

I would say the mall real estate is actually in a more healthy place today. Because of a lot of those old malls that were anchored by these department stores that went under were sold off, torn down, turned into something else, reimagined. And so the supply side was kind of fixed. It really took like 5 to 7 years, I think, to like get that done. And now we're in a place where I think if you go to most malls in the country, like the better malls, like they're, they're pretty well occupied. The rents are generally stable or growing. I think there's a lot of parallels to what's happening in office right now. It could be this long, painful transition, but there is a light at the end of the tunnel.

Let's broaden it out then to the whole of the REIT universe that you look at. What are the most attractive ones and what kind of yields can you find right now?

So one of the fastest growing subsectors over the last 5 years or so is the industrial REITs. So, you know, companies like Prologis or Torino are two names that we like a lot.

Industrial meaning primarily warehouses or warehouses and other stuff?

Almost entirely distribution warehouses. So this is a concrete floor, four walls, and a roof, and you could do all sorts of stuff with it. One huge user of that space over the last five years or so has been Amazon, which doubled their square footage through the pandemic, drove market occupancy from the low 90s up to the mid to high 90s. There's been a lot of pricing power in that space. And so you've seen, you know, really strong rent growth, 30 to 50% in total over the last few years of rent growth, and you have about 5-year lease terms. So these companies are still rolling over leases today that were signed 5 to 7 years ago and increasing those rents by 50, 60, 70-plus percent in a lot of cases. And so I think those kind of structural tailwinds of more people shopping online, is going to continue to drive demand to that space.

Those warehouse or industrial REITs, correct me if I'm wrong, you don't get a ton of yield on those. You're mostly in it for the growth. Is that right?

You're definitely in it for the growth. It's about a 2.5% dividend yield for both of those companies I mentioned, Prologis and Torino. But I do think there's a very strong case that you're at least high single-digit earnings growth, if not somewhere in the double digits, which for a REIT, those are really great growth numbers.

I asked John if there are other pockets of the REIT university likes, and he mentioned senior housing. Matter of fact, when I say senior housing, I'm not talking about college seniors. People have got that right. I think so, yeah. These are not frat houses. These are like assisted living facilities or independent living retirement homes, that sort of thing. In fairness, the seniors could join fraternities or sororities. It's actually— well, hang on, stop everything, because there's no time for fraternity or sorority functions. When you're in college, you've got to be studying, right? That's only going to get you into trouble when you're young. For older folks out there, they've got the time, and at their age, maybe they have better judgment. They're not going to get in any trouble. I feel like this is one of those moments that could change everything, right?

Or, and hear me out, nothing.

Fair enough. Senior housing anyhow is considered a subset of healthcare REITs, and John says that senior housing tends to do well during recessions. Recessions and that they're still recovering from the impact of the pandemic. A stock he likes is Ventus, ticker VTR, which has a yield of close to 4%. John also mentioned Healthpeak Properties. The ticker there is PEAK, P-E-A-K, which specializes in medical office buildings, and that has a yield of just under 6%.

There's almost nothing that's more stable in the REIT space than medical office buildings. It's kind of been a sector that just grows 3% a year forever in good times and bad times. And to the extent, you know, our house view is a recession coming this year. And so if somebody can just continue to grow 3% through a recession, that's very attractive, we think, in this market.

Thank you, John. Okay. So John talked to us about supply and demand in commercial real estate and what that means for investors. But what about what it means what this means for the future of cities. Meet Ed Glaeser. He's a professor of economics at Harvard, and he studied cities for more than 30 years and written several books on the topic, including one called Survival of the City. I asked Ed if he thinks we'll get back to the point where offices will fill up again.

The Economics 101 answer in this is that the price should fall, meaning commercial rents should fall to the point in which the offices more or less get occupied again. They may get occupied by slightly different people, And it's hard to tell exactly how much those prices need to fall, in part because actually just data on up-to-date commercial rents is hardly the easiest thing to work with. So I am certainly on the optimistic side of what's going to happen to office. But I think even in my optimism, I think that commercial rents have got to fall.

I asked Ed if cities can survive, and he said yes. For one thing, a lot of companies and workers, he says, see value in the physical office space. It's important for things like mentoring and relationship building. It also says that the transformation that New York City is experiencing now with empty offices, that's less severe in terms of economics than what the city went through in the 1970s and '80s.

So if you go back to the '50s, the largest industrial cluster in the United States was garment production in New York City, right? Bigger than automobiles in Detroit.

Detroit.

This sector, which was, you know, a fount of entrepreneurship because, you know, very few barriers to entry, very weak-scale economies, anyone with a good idea and a couple of sewing machines could get started. This industry was clobbered, clobbered by globalization, clobbered by automation. On top of that, the city found itself unable to pay its bills. It had a crime problem that got out of control. And it really felt in the mid-1970s as if New York was headed for the brink of extinction. Now, all of that changed largely because of finance. Because the same proximity that once helped manufacturers to get goods off of trains onto boats also helped knowledge move. And there's no industry in which being a bit smarter can make you richer faster than finance. That's why New York became so heavy on finance through the early 2000s. We don't know what reinvention is going to have to happen going forward, but certainly New York is going to have to continue to attract people who actually want to live there. You know, if New York becomes an unpleasant place to live, it's going to be in a much tougher shape than it is if it actually retains talent that actually thinks New York is fun.

Anything in particular to make it fun? You mentioned it needs to be a fun place to live. I work in Midtown Manhattan. I feel like it's mostly bank branches and like fake European cafes. You know what I mean?

Yeah, there's a bit of that, right? All the charm of the chain cafe.

They sell you $25 lunch salads and then they shut down for the evening. So what do we need?

So for me, the low-hanging fruit is deregulation. So I think we need to have— I mean, one of New York's great strengths is an incredible panoply of immigrant potential entrepreneurs, right? All of whom bring actually interesting things that they could be, that they could be selling or doing. Lots of homegrown people as well.

Right.

But it is very, very difficult to start a business in New York. It's very, very difficult to get a license to open an eatery or anything, really. Things like one-stop permitting, the permitting officials get judged for how quickly they are able to process permits. That would be a big step in the right direction.

We talked about New York reinventing itself, but I also asked Ed about other U.S. cities. He said if we're talking about Phoenix or Austin or Miami, we wouldn't even be having this conversation because those cities are part of what he calls the skilled Sunbelt cities. They were thriving even before the pandemic and are continuing to do so after.

Places that had lots of education but also had the relatively pro-business policies of the Sunbelt, also had the relatively pro-housing policies of the Sunbelt. It's just a lot easier to build in most of these places than it is in the Northeast. And let's face it, you know, Americans also seem to like warmer Januaries as well, and that's also a draw.

Ed says the bottom 15 cities are dominated by the Rust Belt cities— Detroit, Cleveland, St. Louis. He says those cities have struggled for decades. What's surprising and new, he says, is that massive cities like New York, Chicago, and Washington, D.C. are all in the bottom 5. They were previously able to stay strong because of their size and their massive office market, which meant they were hubs of talent and innovation. But now that identity is shifting. And Ed had one more reason.

For most of the past 150 years, skills have been an extraordinary predictor of urban success. Skilled cities have done much better than less skilled cities. Over the last 3 years, one of the things that skills do is they enable you to remote work. In May 2020, 68.9% of Americans with advanced degrees were working remotely. 5% of high school dropouts were working remotely. Huge skills divergence. What that means is that, that places like Seattle and San Francisco who have abundant skilled knowledge workers are the ones that are still struggling most with working from home. I don't think that's a permanent setback, but I think it is one that sort of we're going to have to work our way through.

Thank you, Ed. And coming up, we're talking about cars. Matta, you want to start our engine? Sure. You know what? I forgot to use the restroom before we left. Maybe kill the engine. We'll be speaking with Ford CEO Jim Farley in just a moment.

Data is everywhere. When orchestrated properly, it sings. At Morningstar, we analyze and enrich data, making it actionable and powerful for you. Morningstar, where data speaks.

Welcome back, Meta. Tell people what you were just telling me about cars. Car was my son's first word. But he didn't say car. He said car car. Car car. Car car. And how many cars do you have in your family?

One.

You feel like he's trying to tell you something?

Absolutely.

I know someone who would love for you to go shopping for a car car, or even better, how about a truck truck? I had an opportunity recently to speak with Ford CEO Jim Farley. I wonder if you could just give me an update on supply versus demand. It has reversed a couple of times over the past few years. Are you now at the point where you're able to produce all that your customers want? Do customers still want vehicles like you expected, including with interest rates as high as they are?

Good question. No, we're not there yet. We're probably about 10% below the capacity we really need. Our day supply is, you know, 20 or 30-day supply in the dealerships. We're very unique because we have a brand new fresh lineup. We have the Broncos and the Raptors and the Mavericks and F-150. So our lineup is very fresh. We just redid the Super Duty, America's number one heavy-duty pickup. So I think we're in a bit of a different situation than others. The supply chain problems are changing. There's still some semiconductor issues, but more and more they're just general parts shortages. And that has a lot to do with the change in the labor market for our suppliers. But we're all starting to see the dealers' margins go down. Used car values are going down slightly. We're about 95% of the list price. I think the industry is 96%. That's a very high level. Payments are up, you know, $75 to $100. You know, over the last couple of years. So I think we're, you know, at the very high end of the pricing and we could use a lot more product. But I think this is a healthy thing for the industry. And I'm very encouraged that everyone's going to keep their stocks a little bit lower than in the past.

I hear a lot of people talking about affordability with cars. There used to be the economy car. You could, you know, get into a new car for not too much money. You know, those were low margin cars, I gather. A lot of companies have done away with those, and the new vehicles just seem very expensive today. Is there still a place today for the economy car, or has the whole business shifted to more expensive models?

I think things have gotten more expensive, but the income-to-payment ratio has actually stayed the same. So if you look at household incomes, they've also been going up as car payments have been going up. Most people buy, you know, for a lease or finance contract. They buy on a monthly payment, not a total price. But that's been pretty steady over time. But car prices have gone up a lot, especially in the last 2 years during COVID Look, we think there is— I mean, this is Henry Ford's company, right? So we've always believed in democratization of our transportation. But Ford moved away from sedans almost before anyone in the US because we saw it was commoditizing. We couldn't win, frankly. It wasn't a money-making enterprise. But we did one thing. We invested in the Maverick.. It's a $29,000, $30,000 affordable pickup truck. And it is our fastest growing vehicle in terms of demand. I think we're 9 days supply. It turns faster than any other vehicle that we have in our fleet. So there is a huge appetite for affordable vehicles like Maverick. The thing we've learned at the company is don't go and execute your most affordable product in a generic way. Do what's natural for your company. Everyone knows that Ford is great at trucks. So we took our affordable vehicle and didn't do a sedan or a hatchback. We did our affordable vehicle as a pickup, and it's been wildly successful for us and profitable.

I saw you had a solid quarter financially and there was good demand for traditional vehicles. How do you feel about your pace right now on electric versus traditional vehicles? In other words, is the adoption of electric vehicles right now about what you were expecting a couple of years ago? Is— has it Has it been slower? Has it been faster? Where do you think things stand? And what do you think we'll look like by, let's say, the end of the decade?

Well, I think it's different at Ford than for the overall industry. I mean, first of all, we did not expect this kind of demand for our EVs. We're now number 2 in the US. I didn't think that was going to happen that quickly. We're doubling production of Lightning and Mustang Mach-E, which are 2 of the 3 models we have. So we're doubling the production. But we're seeing enormous price— competition like you saw with the Tesla price cuts of $5,000, $6,000, $7,000. So we've had to reduce the bill of material of the vehicle to kind of offset all that pricing decline. And we're obviously in heavy investment mode like everyone else, but we're seeing the demand higher than we thought, especially, you know, in markets outside of the U.S. But the market is changing, actually. We're seeing the highest demand in segments where we went and others didn't, like pickup truck. Or commercial van. Mustang Mach-E is kind of in that 2-row crossover space with the Model Y and a lot of other competition. And that's got almost too much competition. The pricing, you know, is really coming down for Tesla. And so we've had to partially match that. So I think it depends on each company's product strategy. I think we're in good shape. We've been surprised on the upside. The other thing that's happening is hybrids are becoming more popular. We're now number 2 in hybrids in the US. Didn't expect that. Hybrid F-150 is one of our most popular versions of F-150. So as pure electric has grown, so has hybrid. That surprised us too.

You mentioned Tesla. The bull case on Tesla for the people who are very bullish on Tesla, it seems to be no other company is going to match their ability to produce low-cost vehicles. How will Ford Ford compete with that? Will you be able to match them on manufacturing scale and savvy, or is it a matter of competing in different vehicle categories?

It's a combination of both. I mean, the product categories that are natural for us to compete in, like commercial or large trucks or 3-row crossovers, those are segments where Tesla really hasn't been a player at all. I think they haven't even launched a Cybertruck. We've been in the market with Lightning for a year and a half.

Already.

So we're already number one in electric pickups and electric vans. So I think we'll play to our strengths, and I think that's good strategy for us. As far as affordability or our advantage for them, look, Blue Cruise has really caught up, and I, I would argue as good if not better than the full, uh, self-driving system. Ours is a hand-free system, number one in Consumer Reports. We can't keep up with the demand, frankly, of our Blue Cruise software. I think a pro where we do commercial, I mean, we're like 50% of that market in the US, number one brand in Europe for commercial. That's a real strength for us. And it's a really hard business to get in. You got upfitters with bailment programs. It's a very complicated system. Most of the volume is small tradesmen, plumbers, electricians, and they really trust Ford. And we have a very broad lineup and they buy a lot of different, you know, wheelbases, ride heights. Roof heights. So I think that'll make us really different than Tesla. And I think we are designing our second cycle product in the EV space that will be coming out in the next couple of years. I think it'll be fully competitive with Tesla on a cost basis. But they're really good. They're a really good competitor. We're number 2 in the US. And we want to continue to grow from, let's say, 20,000 a month now of production to 50,000 by the end of this year. So it's a lot of growth, but we'll play our own strength. That's, I think, the right strategy for Ford.

How are we doing on the robo-driving? You've got to plan these things years in advance, so you must see around the bend on this to what's coming. Is this— is the, the robo-driving future overstated? Is it going to take longer than people thought? Coming right up, when are the cars going to truly drive themselves? You just hop in and tell it where you want to go and it'll get you there.

Well, I think that last one, robo-driving, where you just tell the car where to go and it drives completely by itself, especially in rain and fog, and that's way off. In fact, we used to own Argo, and we invested a lot in that kind of technology. And we frankly stopped that investment. Where we think the sweet spot is between customers and giving them time back and the technology, the reality of the technology, is what we call Level 3 autonomy. That means on a sunny day, on on-ramp and off-ramp, on highway driving, that we would develop on a highway with the right conditions, a self-driving car. So you take your eyes off the road and you could do a WebEx or a Meet or a virtual meeting. You could listen to and watch a movie or talk to your family. And that's a big unlock for for customers. There's not many product categories that can give 45 minutes back to the customer. And you don't have to go to full driving autonomy to do that. So that's where we're putting, you know, our effort to really differentiate. And BlueCruise is already number one consumer brand for partial autonomy for hands-off. So we got a great head start. We're learning a lot. I think we're up almost 70 million miles of driven hands-free. So we're getting really good at lane centering, going around corners when the vehicle's steering itself, moving over when you pass a big truck. Those are all really important experiences for the customer to feel comfortable when you're on the highway driving partial autonomy.

Your business is going through such profound change right now. I mean, it's like the TV business going from traditional cable TV to streaming, and it's got people thinking, okay, is this future in streaming? Streaming going to be as profitable as the past in cable? What's the story with the car business? Is the future in electric vehicles and, and more autonomous vehicles— is that future more profitable than, than the past car business? As profitable? What do you think?

Well, I would see it like this. I think the profitability could grow because, you know, the vehicles are lower emission. Also, the internal combustion engines with hybrids are becoming more and more popular actually for vehicles that use them certain kind of ways. You're towing a fifth wheel trailer in Wyoming, you do not want a battery electric car. You know, you want one of our Super Duty. So I think the profit pools for the vehicles are gonna, you know, grow frankly, 'cause population's growing around the world and the fleet's getting old. The average fleet's like 11 years old now. But here's the big change. The big change is that we used to be extremely cyclical. So when gas prices or economies slow down, The auto industry, which is highly capital intensive, would really slow down. You would see large losses in the company. And I think what digitizing a product means is we can send software to the vehicle. They can get better every day. And we're not going to see that cyclicality with gas prices much. We think about 50% of our lineup is going to be ICE and 50% will be electric. Well, for the 50% that's electric, fuel price will not be a big— variable when someone buys. The same for software. The cars will get better over time. The repair of the vehicle will be much less because it won't break down as much, at least for the electric vehicles. So we really see the revenue scenes and the profits being more consistent and less dependent on fuel price, gas price, and cyclicality of the economy. Because if you're shipping software, people are going to want to have that hands-free system on the highway. You know, whether the economy is not so great or great. In fact, you could argue that probably want it more when the economy is slow. So I just think it's a different cadence of the profitability and the revenue.

What's your favorite part of the job? What's the thing that you see when you wake up and you've got this thing on your calendar from 10 to 12, you say, today's going to be a good day. What do you like to do most?

Well, for me, I like to make tough choices that will put our factory workers in a position where they have a career, not a job. My grandfather was an hourly worker for Ford. I get up every morning like Bill Ford and everyone else in the company because we want to build a strong middle class for America. We have 57,000 hourly workers at Ford. No company in the auto industry has bet like we have on the U.S. It costs us more. We have the most U.S. employment. And I kind of think of my grandfather. I want to make great decisions for our company and for our customers so that my team in the factory who builds our product has a great future and a wonderful life. That's what gets me motivated. It's as simple as that.

Thank you, Jim and John and Ed, and thanks to Davey for sending in your question. If you want to be famous like Davey, tape a question of your own. Just use your phone, the voice memo app, Send it to jack.hough@barons.com. Thank you for listening. Meta Karkarludzoff is our producer. Subscribe to the podcast on Apple Podcasts, Spotify, or wherever you listen to podcasts. And if you listen on Apple, please write us a review. See you next week.

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