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00:00We're going to go more into the state of manufacturing, business confidence, business investment with right at the end of it. She is the Flex CEO. Flex is an advanced manufacturing company, building products for industries that include cloud computing, data centers, aerospace and defense places where a lot of interest is now. Where do you see the most optimism and the biggest concern? Let's start with optimistic point of view here. Yeah, Sonari, I'd say, of course, most optimism in the place that everyone's talking about, which is AI and data centers and the infrastructure spending that's going on in the U.S., I would say that's one significant sector. The second would be everything around health, right? Whether it is medical devices or medical equipment or the state of play in terms of use of equipment for for medical. Those two are the two biggest. And anything around infrastructure spending, again, in the U.S. would be the most optimistic. And then, of course, the challenging ones are everything around consumer today. In a house, consumer spending, How is that going? Automotive, definitely. You know, math just came back from Europe and talked a lot about that. Those are the ones, I would say, more challenging areas. Yeah. How important, by the way, is that industry? I was covering automotive. They're always looking at it and it seems to be a much bigger chunk of global trade than anyone ever knew or thought about before. Yeah. And we are a big automotive supplier too. And the good part about what we participate in is that we are platform agnostic. So whether you're EV or a hybrid or an ICE vehicle, we participate in all of them. So all the platform moves really doesn't impact us significantly. But to your question of is it a part of global trade? Yes, a significant part because you can see that the U.S. manufacturers and European manufacturers really interplay and participate a lot in each other's economies. Very different in China, what is happening. So I would say it is an important part of it. But the last five years, I would say all manufacturers, including auto manufacturers, have been moving supply chains closer to the point of use. So that shift has been happening. But lots left to do is still you have your fingers in a lot of pies or everything. You have automotive manufacturing contracting that you do as well as computers, right? You assemble Apple Mac Pro laptops as well, if I'm not mistaken. How likely is it that we're going to see a cell phone, a competitive smartphone assembled in the US this year? Yeah. So today, I would say seven years ago when I first came into my job mat, we did high volume consumer devices. Today, we don't do much of that. We don't do high volume consumer devices like cell phones or laptops. But Flex being one of the world's largest manufacturing companies, I do have a point of view on I would say that one, for the more automotive automated sides of manufacturing, I think there's a continuous shift that will happen. I'll give you one statistic, Matt, if you think about the last five years, so the things we buy in our supply chain from the Trump tariff 1.0 to today, we have seen a pretty significant shift of our supply chains from China, from Asia to North America. So we've moved from being 30% procured from those regions to now 45% being procured in North America, which means that a lot of manufacturing can happen in the region for the region. And if I look forward, I would say we will continue to see a very significant shift in those supply chains back to North America. I think there will be a few challenging areas, like we've talked about magnetics, batteries, those kinds of things. But high volume manufacturing, I would say automated manufacturing, a lot can continue to move close to the point of use would be my point of view, and it has just started in these sectors. So you think about the combination of A.I., robotics, automation, lots to be done. So I'm very optimistic about more automation, more production does continue to move to the point of fused, right? Not everything, but there will be a signal. Well, my question here too, is if you're looking at more automated manufacturing moving back onshore to the United States, how likely is it that this big push for U.S. manufacturing to grow, how likely is it that it will actually create jobs? I would say it will create jobs may not be to the extent the jobs were being utilized when you were manufacturing the same product in Asia. Maybe I'll just give you an example. We just announced a new facility in Dallas that we're a 500,000 square feet facility in Dallas, all manufacturing kind of power infrastructure products for AI. That facility is creating 500 jobs just now. We're hiring as we speak. So it does create new manufacturing jobs. I think the there is a lot of open manufacturing jobs in the U.S. So I won't say that it's easy to hire, but it is creating new jobs. And though the really big question to me to hear is that even if you bring some manufacturing jobs back to the United States, ultimately what can't be done here? What are the areas of manufacturing that the U.S. should throw up its hands and say, well, wait a minute, that just won't be made here? I would say if I look forward, the things that will be difficult today are things that are on magnetics batteries where you know, everything about rare earth and raw material sourcing is difficult. Today in the U.S., I would say even things like high volume, things like capacitors, resistors, you know, will take time before those efficiencies can be moved to the U.S.. Those would be the challenging areas. But, you know, the like I said, 45% of our raw material today, our supply chain has shifted already to North America. I expect another 30% will shift over the next few years and there will be a tale left behind, like things like magnetics and batteries, which will be hard to do in the next few years here in the U.S. But I would say that as those raw material constraints are managed through, you can see that shifting eventually, but there will be challenging ones like that. Previously, let me just ask you quickly, we only have about 30 seconds here, but from the conversations I had with automotive executives at Lamar, it seems to me that rare earth processing is not going to get done in the U.S. It just seems too dirty and too dangerous. I would agree. So there's a long ways to go in terms of rhetoric. That being said, there is other countries around the world that has availability of these rare earth minerals, Right? Latin America has pretty significant availability. So making deals with those countries where there is availability outside of China will continue to be important as we manage through that.

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Manufacturing CEO Sees a Factory Resurgence

Flex is an advanced manufacturing company that builds products for industries including cloud computing, data centers, aerospace and defense. Flex CEO Revathi Advaithi joined Bloomberg Open Interest to talk about the trends she's seeing in US manufacturing as President Trump's tariffs reshape global trade. (Source: Bloomberg)