>> i'm jon erlichman. welcome to bloomberg markets. matt: i met matt miller. we are at session lows on this friday afternoon looking at the s&p 500 now down one point 2%. 4450 is the level there. we see investors settling bonds as well. the yield on the 10 year is rising three basis points to 43164. bloomberg dollar index coming

off a little bit still at 1253.5. we see oil continuing to rise. nymex crude now trading at $90.63 per barrel. that is putting pressure on the market. n in the strike story, getting you up to speed in auto stocks. mix performance from ford, gm, and it still and tense with us to lantus and gm higher on the day and forward a little weaker. for those wondering why you might not see a sizable selloff in the names, the analyst community has been weighing in with the argument being that most people expected we will get -- would get to the deadline and ultimately have no deals. because you are seeing a strategic approach or by the uaw, the damage in theory could be worse. we will find out what happens

over the days ahead. we are watching weakness in the supply chain. the car stocks. the auto industry publicly traded version. carvana and carmax are down today. they were up into the news. advanced auto parts down it now. we will continue to watch all the names. if there are fewer vehicles coming out of factories obviously, you have to work on your car or find a used car. matt: it is like opposite day because we would expect carmax and carvana to do well. this pushes new supply out. so you have to get used cars come as you said. you would expect tesla to be a big gainer. they seem like they will be the winners if the strike drags on. i guess that is a big if. gm, you would expect them to be down. but gm is showing gains. it was the last automaker to deal with the strike in 2019. earlier this morning david westin spoke with the ceo of

general motors mary barra. take a listen. mary: or than once a day, calls, texts, meetings. i have been at the table myself over the last few days. i will continue to be extremely involved. our team is ready there waiting to negotiate. by request is, the uaw leadership needs to get back to the table so we can get the problems solved and get people back to work. another important point is for every job at general motors has there are six more jobs in the economy that depend on us running. this is broader than general motors. it is important for planned cities especially and really the nation. jon: let's get more details with kailey leinz. geez i want to start with you. what is the latest we know things about where things stand? keith: they are not bargaining today, a little concerning.

hopefully they will start bargaining again this weekend. the way they have opened up with the plans they chose, around 13,000 workers out of 150,000. one person described it as more of a skirmish than a war. it will get worse as they expand it to additional plans. matt: in washington it is interesting. the president wants to avoid a strike. he said a couple times in his statement no one wants the strike. on the other hand he is trying to portray himself as very prounion and will probably not be on the picket lines with the workers but other democratic additions will be. how does that stand? kailey: bernie sanders will be there. debbie stabenow, a michigan senator. you are seeing vocal support for the uaw in the effort. president biden as you alluded to has dubbed himself the most prounion president in history. in remarks he made at the white

house in the last hour he was pretty prounion. he said though no one wants a start he respects the right to the workers to use this tool to advance their cause and he said that the big three automakers should make further concessions because record profits should be shared with record contracts for the uaw. he said automakers built the middle-class and need wages that can sustain them in the middle class. the president is not just aiming to be prounion. he is aiming to be a climate president. at the end of the day the battle between the big three and uaw is not just about wages. there are other issues including their role in the easy transition, a transition this president has pushed heavily. there are massive subsidies for new electric vehicle sales in one of his big legislative compliments the inflation reduction act. he sat a goal of having 50% of new vehicle sales be electric by 2050 and that go along with the prounion sentiment is running into conflict in this conflict

between the uaw and a big jon: thank you, kailey leinz in washington and he's not and. -- keith naughton. the strike goes far beyond the midwest. the story in d.c.. today i spoke with the union that represents canadian auto workers. they are fast approaching the deadline to get a new deal with ford. sharing an update on negotiations in canada. have a listen. >> we are still at the bargaining table. we selected ford motor company as the target for a pattern agreement. our deadline for the talks, in terms of agreement expiring is monday at 11:59 p.m.. we are still hard at it and feel confident. time will tell. we had two economic offers from ford and rejected both of them.

jon: here we have cornell university director of labor education research kate bronson jen are joining us. thank you for your time. we have heard from guests that there are so many different parts to the story it's hard to summarize that in one direction. what you -- will you be watching closely from here out? kate: the union is using a strategy used rarely in the labor movement. they are striking, not pulling everybody out at once, but doing intermittent starts. they have an element of surprise that makes it difficult for the employers. it will be interesting to see how that plays out. it's a difficult strategy for the union because it takes much more work to make sure you get each group out on time. they go back in if they are supposed to go back in. it is a strategy that has been very effective like in

agreements in the airline industry. flight attendants have used the strategy. fci you 1199 used it in new york city with the voluntary hospitals and is very effective. matt: why strauch -- strike at the bronco and colorado planned? why not go for the f-150 line straightaway? why not go for the silverado, the real moneymakers? kate: maybe the auto companies expected into there. they go places where it is not expected. this is an escalation strategy. they are building momentum where there is still commitment and solidarity among the workers and it also puts pressure on employers to settle because they don't know what is happening next. jon: going through a transition to electric vehicles now, kate, we heard in canada from the union representatives for

autoworkers from the victory based in canada now. the next decade will be such a transition. what kind of commitments can companies make during that transition? kate: we have seen many different industries having to go through this due to climate, due to technological change. these are tough issues. the thing about having a union involved is that the union is able to bargain over the effects and make sure the changes are done in a way that is at least unsettling for the workers. also the electric vehicle industry has other issues for workers, major concerns about health and safety. the batteries are very combustible. there are concerns there are not enough safety protections. it is both figuring out what to do for workers to make sure they are transferred and have opportunities for good jobs and that the workers working in the industry are protected from health and safety issues.

matt: i wonder about amanda. i think a lot of people and get on board with in -- increased pay, considering they took a week deal in order to support the companies and now the companies have done incredibly well and the ceos are getting $30 million a year. the other demands are more difficult to get behind. benefit pensions are the kind of things that bankrupts companies and countries. at four day work week is very high in the sky. that will not happen in real life. why demands those things? kate: the autoworkers have a 75% support rate from the public. these issues resonate with american workers. people feel like they have been working too long and they are worried about long-term security. all workers had benefit pensions. this is part of the two tier

issue. it's just make concerned that workers would have different benefits and different pay working alongside each other. there is concern about two -- too much overtime, too long hours. we saw that with covid. in the aftermath of covid, people want to spend more time with their family. there are concerns about time spent at work. in other countries in the world they are cutting back the workday to improve employment. so, these are not issues the public sees as negative. obviously the business community is to learn about them. by the public feels like there is enough money there that companies make huge profits and get these subsidies from electronic vehicles. the gap between what the workers make and what the ceos take home is growing wider and wider and i think that resonates with the public. matt: can i ask about the tier system? i feel like it is pretty normal that somebody that is starting

out at a job does not have years of experience gets paid less than -- and it does not get as many benefits or days off as a that has been there a while. you already. isn't that normal? why would they want to get rid of that? kate: two tier is different than seniority. this and yorty system is if you work longer you get more money. due to your is a different pay scale for those newly hired than the workers that have been here all along. two tier in some companies, the lines continue to be parallel. the new hires never catch up with existing hires no matter how long they work. in other companies and they might set up as two-tiered and eventually come together. but, you can see the airline industry did a big move to two tier in the 80's and gave up on that because they discovered it had very negative effects on productivity and more row. -- morality [speaking foreign language]

--morale. it ended up being more of a negative that a positive. i think other long-term industries moving to two tier to save money will discover it hurts as much as it helps. matt: thank you, kate. these are deep, complex issues and we want to get into them as much as we can't read the cornell university director of labor education research there helping us sort out some issues. coming, jeffries analyst philippe houchois jo t discuss the marketing impact of the start. this is bloomberg.

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>> if we need to go out we will. >> we are staying to doing right with the company. this is a strike that needed to happen. >> with discussion on any issue we did talking with the industry. >> how to be a resilient auto supplier. we are a very vertically integrated company. hopefully we end up in a good place for everybody. jon: some auto executives this week talking about the uaw strike it into our stock of the hour, or stocks. because we have been watching the entire sector. it is mostly higher interest outside of tesla. the analyst community by and large is still bullish on the

sector over the next year. look at the target price that bloomberg measures. the industry along with tesla has been a getting ready for the future. the picture has been reasonable in the auto center. matt: big losses for some manufacturers. obviously, the push is there to transition completely to electric vehicle that away from gasoline. it is interesting tesla is down while other makers -- automakers are up. let's ask why with jeffries analyst phillipe houchois. it is kind of weird to see carmax, carvana, tesla, you know, advanced auto parts, all down today. and in the big three automakers doing well as we hear of this strike. what is happening?

phillipe: i agree. tesla has had a good run. we are not sure about the appetite for electric vehicles in the u.s.. at tesla we may be see some excitement. but the tightness, if we do have a strike and we have a low supply of used cars, is a strike goes on for a while, that two-tiered rates supply and shoots down prices. that is really what surprises me. jon: federation of the strike is what everybody is curious about. you already crunched the numbers on what the prophet hit for automakers could look like as you go through this on a weekly basis. what do the numbers tell you?

philippe: it is very hard to gauge because it's a very technical strike. we have basically looked at how much of the output was lost by gm in 2019 and with that loss we calculate lack of coverage for weeks for the different carmakers. ford per week of strike might lose 45% of its annual rebate. gm a little less. we think there space is lower than ford and gm and more diversified in earnings outside the u.s.. we need to figure out how long the strike will last. matt: what is behind the push to transition to electric vehicles beyond the typical all tourism we usually see from giant

conglomerate corporations. is it consumer demand? why are they shifting here? philippe: it's not consumer demand in itself, though they have done a good job convincing the general public that electric vehicles are valuable. in general terms of usage of energy ev's are more efficient than any transportation. i think that's probably a long-term trend. otherwise it is regulation. we have seen that in china and even more in europe. it is a combination of different factors. they could be convinced it's a viable solution with tesla and we should recognize that. right now the case with options is difficult. the first phase was easy in a way. you have expensive cars.

then, you had incentives. i think you move into a situation where you need to be able to sell more affordable cars then it's challenging. from a u.s. perspective what is important is because there is less of a mandate with electrification then there is in china or europe i think carmakers like ford and gm are concerned that as they move and evolve through electrification they might lose some element of competitiveness and carmakers are also driven by that consideration. the world is moving electric. if they don't take that trend and they will lose global competitiveness as well. jon: nice worldwide context. thank you phillipe houchois from jeffries on the auto outlook from here. president biden will be sitting down with benjamin netanyahu on wednesday according to the u.s. security advisor jake sullivan that is speaking currently at a

briefing in washington. he says biden will meet with ukraine's president thursday. watch the briefing on the terminal on live go. this is bloomberg. this is bloomberg. ( background noises ) this is a clustomer. hello! it's what happens when marketers group customers with very different behaviors... into one tangled mess. this is a mess! with mailchimp, marketers can use real-time behavior data, to personalize every email for every customer. turning clustomers, into customers. intuit mailchimp. the #1 email marketing and automation platform.

jon: bloomberg new energy finance is out with a column laying out how the auto strike could punch up vehicle start -- prizes and make tesla vehicles more attractive. we want to bring in analyst cory cantor. how big of an opportunity is this for tesla? cory: tesla sold about 341,000 vehicles. about 30% of the ev market the first half of the year. 18% of the passenger ev market. tesla has been cutting prices throughout the year. they seem to be pushing forward

on making the ev more adaptable for the mass market. the big three have a lot of pressure on the transition to electric vehicles. this has bought time for them to move forward on building up ev manufacturing across the board and getting their charging capabilities up to speed. matt: it seems like they would benefit the most. we are showing the model x. that is expensive but they have a more affordable model three they just refreshed that looks great. what about companies like rivian or lucid? their products are expensive. do they gain ground over, say, a gmc hummer? cory: rivian up to their target to 52,000 for the year. they are in production and will be seen as a company of the future. the longer the strike goes on consumers may see tesla and rivian as moving forward in that ev transition and not stuck in

the mud. matt: cori we will get you back on. there's so much to talk about and we love your insight. cory cantor is an analyst with bloomberg new economy finance. that is the place to go when you want to know about the industry. with jon erlichman i am matt miller is bloomberg.

jon: a triple strike, triple threat, and triple retching. i am romaine bostick. vonnie: i'm vonnie quinn. at the closing bell in the united states the nasdaq 100 is down. it has been a volatile day. a trillion dollar event happening today. all week volume,