Speaker 1: Bloomberg Audio Studios, Podcasts, radio news.
Speaker 2: Well, Elon Musk is now the richest person on the planet.
Speaker 3: More than half the satellites in space are owned and
Speaker 3: controlled by one man.
Speaker 4: Starting his own artificial intelligence company.
Speaker 3: Well, he's a legitimate, super genius, legitimate, he says. He's
Speaker 3: always voted for Democrats, but this year it will be different.
Speaker 1: He'll vote Republican.
Speaker 4: There is a reason the US government is so reliant
Speaker 4: on him.
Speaker 1: Elon Musk is a scam artist and he's done nothing.
Speaker 2: Anything he does, he's fascinating people.
Speaker 3: Welcome to Elanank, Bloomberg's weekly podcast about Elon Musket's Tuesday,
Speaker 3: December third. I'm your host, David Papatapolis. Now, Elon Musk
Speaker 3: loves himself a good lawsuit. He's always suing someone or
Speaker 3: getting sued by someone, and these cases are constantly percolating
Speaker 3: in the background, but this week they take center stage.
Speaker 3: Late yesterday, News broke to the Delaware court yet again
Speaker 3: has struck down his ginormous Tesla pay package. Meanwhile, JP
Speaker 3: Morgan decided the best to walk away from a separate
Speaker 3: suit it had brought against Musk, who in turn decided
Speaker 3: it was time to re up an old suit he
Speaker 3: had filed against rival Sam Altman and his company Open Ai.
Speaker 5: All is fair in love and war and law, fair,
Speaker 5: as Elon likes to call it.
Speaker 3: After that, we're going to get into the way politics
Speaker 3: is reshaping the Musk customer base something of a fascination
Speaker 3: of ours here at Elon Inc. To talk about all this.
Speaker 3: I am joined in the studio by our old pal
Speaker 3: Sarah Friar. Hey, Sarah, Hey, you picked a hell of
Speaker 3: a week to come to New York. It is cold here, Sarah,
Speaker 3: love it okay.
Speaker 5: Very good.
Speaker 3: We also have our regulars Max Chafkin and Dana Hall. Hey, Max, Hey, David,
Speaker 3: Dana Hello, Hello, Hello. And on the bat phone, we
Speaker 3: have a special update coming from Bloomberg's man in Delaware,
Speaker 3: our courts reporter Jeff Feely.
Speaker 5: Jeff, Hello, sir, Good morning. All So, Jeff, we're gonna.
Speaker 3: Start with you and this ruling that came last night
Speaker 3: on the Musk pay package. Tell us what exactly did
Speaker 3: the judge there, Chancellor Kathlyn McCormick rule last night.
Speaker 2: She's judge Kate. He just judged Kate down here. She
Speaker 2: ruled for the second time that must pay was the
Speaker 2: result of a tainted process and that it should not
Speaker 2: be reinstated, even though there was a second shareholder vote
Speaker 2: overwhelmingly ratifying the idea that he deserved the largest compensation
Speaker 2: award in US corporate history. And she also awarded the
Speaker 2: legal fees of three hundred and forty five million dollars
Speaker 2: to the lawyers who represented the loan Tesla shareholder who
Speaker 2: took issue with this. With this pay package, they had
Speaker 2: been asking for stock in the neighborhood of five billion dollars.
Speaker 2: They pointed to the fifty five billion dollar pay package
Speaker 2: as the load star that they were comparing themselves to
Speaker 2: and hoping to be awarded upon. But the judge, following
Speaker 2: the guidance of the Delaware Supreme Court, found that that
Speaker 2: would be an unfair windfall and cut back their feet
Speaker 2: only to three hundred and forty five million dollars.
Speaker 5: Woo, Who poor them.
Speaker 2: I doubt Greg Vala, who's the lead lawyer, was crying
Speaker 2: in his beer last night.
Speaker 3: I would think that the number on that pay package
Speaker 3: bounces all around. As we last understood it, what was
Speaker 3: the approximate number two?
Speaker 2: What did we I think we in the story said
Speaker 2: that it had definitely bounced beyond fifty five you know,
Speaker 2: again because Tesla's stock, you know, it's so volatile, it
Speaker 2: just goes all over the place.
Speaker 3: I thought it had gotten max to like around one
Speaker 3: hundred billion or so, giving some work, Well.
Speaker 2: The numbers we used in the story were that when
Speaker 2: the stock option grant was made, they were worth two
Speaker 2: point six billion, and by the time the trial went
Speaker 2: on they were up to fifty six billion.
Speaker 4: So as of Monday one hunt, according to the Bloomberg story,
Speaker 4: one hundred and one point five billion. Oh yeah, which
Speaker 4: is obviously that the stock price of Tesla has gone
Speaker 4: way up over the last month or so.
Speaker 3: Yeah, there we are, now, Jeff, hadn't there been a
Speaker 3: sense that the new shareholder vote, done with greater transparency
Speaker 3: and so on and so forth, had addressed fully or
Speaker 3: at least some of Judge Katie's concerns. Apparently not, But
Speaker 3: I but I thought there was that sense out there
Speaker 3: that had been the case.
Speaker 2: Well, I mean, look, the reality is this was a
Speaker 2: novel question of law in terms of could you basically
Speaker 2: use a second shareholder vote to and affect correct problems
Speaker 2: with the pay process and the problems that Judge Katie
Speaker 2: had identified the first time around, just rampant conflicts of
Speaker 2: interest had not really been addressed. I mean, you know,
Speaker 2: there were some cosmetic changes, but the process itself was tainted.
Speaker 3: And Jeff on that the rampant conflicts of interest. Basically,
Speaker 3: this board is just too much in bed with Elon Musk.
Speaker 2: That's the idea, and that is exactly right.
Speaker 1: I'd just like to know.
Speaker 6: I mean, Tesla's own proxy made it very clear to
Speaker 6: shareholders that there was no certainty that this revote was
Speaker 6: going to change the outcome of the case. I mean
Speaker 6: they said it plain as day. A special noted that
Speaker 6: even a favorable ratification vote by stockholders may not fully
Speaker 6: resolve this matter. We cannot predict with certainty how a
Speaker 6: revote will where I will vote to ratify the performance
Speaker 6: award would be treated under Delaware law under these novel circumstances.
Speaker 6: So these risk factors were all laid out in the proxy.
Speaker 6: I think what happened was that Musk kind of did
Speaker 6: this like marketing campaign to all of the retail shareholders
Speaker 6: and got them whipped up into this frenzy so that
Speaker 6: they think that this is like a direct democracy that
Speaker 6: they voted to ratify it again. And therefore it would
Speaker 6: sail through. And they're completely ignoring the precedent of Delaware
Speaker 6: law and the process in Delaware. And that's why you're
Speaker 6: seeing so many people upset today. And you know, like
Speaker 6: Tesla's obviously going to appeal, but Tesla's ow proxy made
Speaker 6: it very clear that they were taking a novel approach
Speaker 6: to trying to resolve.
Speaker 3: So, Jeff, when Tesla appeals, how does that appeal process work?
Speaker 2: They've already filed their notice of appeal.
Speaker 3: They did, and so they filed that to whom and
Speaker 3: how exactly does that work? And what would the timeline
Speaker 3: that look like?
Speaker 2: All right, So, the Delaware Supreme Court is where this
Speaker 2: case goes, and unlike the US Supreme Court, they don't
Speaker 2: choose their cases any lower court ruling. They have to
Speaker 2: hear the appeal of So it's headed to the five
Speaker 2: members of that court, and it's going to take the
Speaker 2: better part of a year for all the processing to
Speaker 2: get done.
Speaker 4: Hey, Jeff, can I ask a dumb question. Isn't Tesla
Speaker 4: based in Texas?
Speaker 5: Now?
Speaker 2: It is?
Speaker 5: So, at what point.
Speaker 4: Does that have an effect on what the company tries
Speaker 4: to do with Elon Musk's pay Okay?
Speaker 2: Well, so, because they were a Delaware company when this
Speaker 2: package in two eighteen was negotiated, they're still covered by
Speaker 2: Delaware law for this case. If they decide, you know,
Speaker 2: if they lose on appeal, the likelihood is they're going
Speaker 2: to run to the new Business Court in Texas and
Speaker 2: you know, basically create a whole new package in Texas,
Speaker 2: and it's probably going to be the same package that
Speaker 2: they proposed here at Delaware, and the likelihood is it'll
Speaker 2: sail through like you know, bacon or in Greece decision.
Speaker 5: I don't know that bacon and grease sales. But anyway, Sara,
Speaker 5: you were.
Speaker 7: Does that mean that Musk's plan to just move all
Speaker 7: of his lawsuits to Texas, like anything that we ever
Speaker 7: do to challenge Musk in the court of law will
Speaker 7: be heard there.
Speaker 1: That's going to work.
Speaker 2: Well, there is a provision in the law where corporations
Speaker 2: can decide where their litigation is going to be. They're
Speaker 2: called you know, basically forum clauses, and yes, those are
Speaker 2: considered legal. If Elon and the Tesla board decide that
Speaker 2: all litigation against Tesla will be heard in Texas, there's
Speaker 2: really not much that shareholders can do about it.
Speaker 3: So then why take the step of appealing to the
Speaker 3: to the top court in Delaware if in the end
Speaker 3: you just know you're going to go to Texas.
Speaker 2: Well, I can tell you it's pretty easy. I mean,
Speaker 2: we just mentioned that the guy is worth more than
Speaker 2: one hundred billion dollars, so picking up the tab for
Speaker 2: another appeal in Delaware it'n't exactly going to leave him
Speaker 2: eating dog food out of cans. So I think he's appealing,
Speaker 2: you know, basically because he can.
Speaker 4: I mean, it's an interesting test of the like Elon
Speaker 4: Musk ability to just sort of force things make, you know,
Speaker 4: try to try to essentially avoid the law or ignore
Speaker 4: the law, you know, go on Twitter and say this
Speaker 4: is this is bs, I'm not going to do it,
Speaker 4: and then the ability of like courts to assert their authority.
Speaker 4: I mean, over the last month, we've seen all of
Speaker 4: these kind of very optimistic projections by like Tesla shareholders
Speaker 4: that somehow Trump is going to drastically shift, you know,
Speaker 4: basically the dollars and cents of this company. And I
Speaker 4: feel like this this case, although it's not going to
Speaker 4: change that much, it just shows that like you cannot
Speaker 4: you know, reality and the reality of the justice system
Speaker 4: will assert itself.
Speaker 7: Well, I mean, remember this is the judge that forced
Speaker 7: Musk to buy Twitter. That history has sort of been
Speaker 7: revised now into something Musk always wanted to do, to say,
Speaker 7: free speech. But as we remember while on this podcast,
Speaker 7: it was really Judge Katie.
Speaker 3: Yeah, for a guy who's been winning and winning and
Speaker 3: winning of late. And you know he, as we've said
Speaker 3: perhaps in the past, when he tangles with Judge Katie,
Speaker 3: he loses.
Speaker 2: As my friend Dana Hall has very evocatively said, you know,
Speaker 2: he's he was teflon Elon. Nothing stuck to him. He
Speaker 2: slid like bacon on greef.
Speaker 5: You're making me hungry here, Pheely.
Speaker 2: I know, I know. Anyway, he's got some dents in
Speaker 2: his armor here, and she's pretty much the only one
Speaker 2: who was held his feet to the legal fire.
Speaker 5: You got to give her some credit, absolutely, mister Peeley.
Speaker 5: We will let you go, sir.
Speaker 3: We'll have you back on soon when there's a new
Speaker 3: twist and turn in the case.
Speaker 2: Listen, everybody have a wonderful day, Dana.
Speaker 3: So let's zoom the lens back out for a second.
Speaker 3: In general, on lawfair as a whole, Elon loves to
Speaker 3: talk about the term. What exactly is the definition of
Speaker 3: lawfair as we understand it, what's kind of.
Speaker 6: This combination of law and warfare? And I think the
Speaker 6: coinage comes from two thousand and one, after the September
Speaker 6: eleventh attacks, when the idea is that you could sort
Speaker 6: of weaponize the law to go after your adversaries.
Speaker 1: And Musk loves this term.
Speaker 6: He has often said that Donald Trump is a victim
Speaker 6: of lawfair, that he himself is a victim of law fair.
Speaker 6: If you do a search of his posts on X,
Speaker 6: it's like lawfair, lawfair, law fair. When when he hosted
Speaker 6: Trump on in August, he kept kind of trying to
Speaker 6: steer the conversation to like, hey, like, we're both victims
Speaker 6: of lawfair. So it's just something that he is constantly
Speaker 6: harping on. But the big irony is that he himself
Speaker 6: is so litigious. I mean, he is right now trying
Speaker 6: to sue Sam Altman into oblivion, and he is often
Speaker 6: the plaintiff in a lot of cases. And so I
Speaker 6: just think it's fascinating to look at how Musk himself
Speaker 6: has kind of weaponized the law. He has so much money,
Speaker 6: he can hire the best law firms, he can go
Speaker 6: for broke and oftentimes that's how law works, right, Like,
Speaker 6: the richest people have the resources to litigate beyond their adversaries.
Speaker 6: And you're seeing that play out over and over and
Speaker 6: over again, and so I just think there's sort of
Speaker 6: a wider frame here, Like right now Musk is saying
Speaker 6: that he is a victim of the lawfair against him
Speaker 6: in Delaware Chancery Corps, and he's clearly whipping all of
Speaker 6: his fans and retail shareholders into agreeing with him. At
Speaker 6: the same time, look at what he's doing, suing not
Speaker 6: just open ai, but now Microsoft to over open aies
Speaker 6: you know, nonprofit versus for profit status plans, and and
Speaker 6: how how many times Musk has been in lawsuits.
Speaker 3: Yeah, so Max tell us a little bit about that
Speaker 3: freshly opened Musk suit against open Ai.
Speaker 4: Well, he filed the suit, then he dropped it, then
Speaker 4: he refiled. And the latest twist is an injunction asking
Speaker 4: the court to stop open AI's plan to change its
Speaker 4: status from a non for profit or this very complicated
Speaker 4: legal status that had had where there was a non
Speaker 4: for profit that owned the for profit to a more
Speaker 4: conventional for profit, which it's trying to do because it's
Speaker 4: trying to raise, you know, buckets of money, and Elon
Speaker 4: Musk's suit is basically asked in the court to stop that,
Speaker 4: and it's and the arguments it's megan, they're kind of interesting.
Speaker 4: There's a few different ones, but couple of which are
Speaker 4: basically anti trust claims. I trust, yeah, yeah, based on
Speaker 4: a couple of factors. One is interlocking directors. To me,
Speaker 4: the most interesting one is this idea of the interlocking directors,
Speaker 4: which would be a violation of federal antitrust law.
Speaker 5: You have Sam help me out there for.
Speaker 2: AI.
Speaker 4: So this is this is a thing that has come
Speaker 4: up in discussions around Microsoft and anti trust and open
Speaker 4: Ai and anti trust and various FTC things.
Speaker 5: But basically, like there are.
Speaker 4: Legal issues with a director serving on the board of
Speaker 4: companies that are doing business together, which is a case
Speaker 4: for open ai where you had Reid Hoffmann simultaneously serving
Speaker 4: on the board of open Ai and Microsoft. He's now anyway,
Speaker 4: and so a bunch of issues like that. And then
Speaker 4: there's also a complaint about open Ai suggesting to venture
Speaker 4: capitalists that they not invest in Elon Musk's company, which
Speaker 4: my understanding is something that is not all that unusual.
Speaker 4: Sarah may have a better sense of this is not
Speaker 4: something that's entirely unusual in the world of venture capital,
Speaker 4: although you know, perhaps it does raise some raise some
Speaker 4: legal issues. Basically Elon Musk doing everything you can to
Speaker 4: mess with you know, a competitor and and really the
Speaker 4: strongest competitor in the in the world of AI.
Speaker 7: What's so interesting about this case to me is like,
Speaker 7: usually when there's a lawsuit, you can get a sense
Speaker 7: of who is who's the big doug and who's like
Speaker 7: fighting for their life right. Usually it's like a David
Speaker 7: versus Goliath kind of situation. In this situation, you know
Speaker 7: that you've got the richest man in the world who
Speaker 7: has his own AI company suing his I guess co
Speaker 7: founder is one way to put it. Of Open Ai,
Speaker 7: who has also created this extremely powerful, influential AI company
Speaker 7: that's that wants.
Speaker 5: To conjunction with Microsoft.
Speaker 7: In conjunction with an extremely powerful big tech company which
Speaker 7: wants to completely reconfigure like the data center infrastructure in
Speaker 7: the United States. It's going to cost them billions upon
Speaker 7: billions of dollars, are going to need a lot of
Speaker 7: government support, and so this lawsuit is interesting, but it's
Speaker 7: also interesting in the sort of wider lens of like
Speaker 7: Musk is now sitting at the right hand of the president,
Speaker 7: Altman needs the government to be behind him one hundred
Speaker 7: percent on his data center build out to fulfill open
Speaker 7: AI's ambitions. So this not for profit debate is kind
Speaker 7: of like a hiccup in the grand scheme of things,
Speaker 7: in both of these men having like these intense ambitions
Speaker 7: for AI taking over.
Speaker 4: I do think Elon Musk's position has gotten a lot stronger,
Speaker 4: and not only because he's revived this lawsuit, but because,
Speaker 4: as Sarah says, he's in a position to have a
Speaker 4: huge impact on AI policy and open ai and not
Speaker 4: just AI policy, but anti trust policy, lots of policies
Speaker 4: that potentially impact you know, not just open AI, but
Speaker 4: like any company that he competes with. And so you
Speaker 4: have this suit on one side, and then on the
Speaker 4: other side, you know half a dozen things that the
Speaker 4: Trump administration could or couldn't do that would have an
Speaker 4: effect on this market and potentially could benefit and must We.
Speaker 3: Should note that his AI company, Xai, all the while
Speaker 3: is growing quite a bit, is it not.
Speaker 6: They've built out this massive data center in Memphis, Tennessee
Speaker 6: that they call Colossus. They have all these Nvidia GPUs.
Speaker 6: They've hired a bunch of people. I don't know what
Speaker 6: the current valuation is, but they yeah, no, it's I
Speaker 6: mean it's a real company. It's small, but it is
Speaker 6: not something to be taken lightly. Like Elon moves very.
Speaker 7: Fast and in the market of AI, like what matters
Speaker 7: is the capital, Like you just need money, Like the
Speaker 7: tech is kind of open source at this point, you
Speaker 7: just need buying and sometimes like appearing it's super capital
Speaker 7: intensive industry, super capital intensive, Like it's getting more efficient, right,
Speaker 7: but the amount of of compute power necessary to do
Speaker 7: an energy and energy to do the kind of analysis
Speaker 7: that AI needs to do, it's only getting getting exponentially
Speaker 7: heavier as AI develops, and it's going to continue in
Speaker 7: that direction. As AI gets more efficient, they're just going
Speaker 7: to try to make it do more things, which is
Speaker 7: going to cost more and require more. Like even if
Speaker 7: like every energy plant in the entire United States ran
Speaker 7: it full capacity, like it wouldn't fulfill the need of
Speaker 7: this industry. But then there's also just like the idea
Speaker 7: that if you are a competitor of Musk, which is,
Speaker 7: to be clear, a lot of the entire business America. Yeah,
Speaker 7: if you're if you're in if you're in EVS, if
Speaker 7: you're Jeff Bezos, if you're you know, a rival in
Speaker 7: social media, if you're you have to be scared of
Speaker 7: this open Ai lawsuit and also must proximity to Trump,
Speaker 7: And like what that might mean for who Trump decides
Speaker 7: to have a grudge against the other.
Speaker 4: Thing is like this lawsuit doesn't have to succeed in
Speaker 4: a conventional sense for it to hurt open Ai. Like
Speaker 4: just slowing down open Ai is potentially a win for
Speaker 4: Elon must because open Ai, yes, it's very successful. But
Speaker 4: Sarah kind of hinted at this, none of these companies
Speaker 4: are making money. Open Ai is losing huge amounts of money,
Speaker 4: burning billions of dollars, and that's part of the reason
Speaker 4: they're trying to go for profit, because they're trying to
Speaker 4: create additional things they can offer investors to keep the
Speaker 4: capital spigot flowing. So, you know, anything Musk can do
Speaker 4: to slow open Ai down is going to help his company,
Speaker 4: which is at effectively an earlier stage. But you know,
Speaker 4: really all these companies are at an early stage, So
Speaker 4: so despite the fact that open as a lead, you know,
Speaker 4: he can kind of like start to try to bring
Speaker 4: his company up to parody.
Speaker 5: Got it okay? Now? Dan?
Speaker 3: Meanwhile, JP Morgan decided, I believe sometime in the last
Speaker 3: few days, to drop a lawsuit it had brought against
Speaker 3: Musk tell us.
Speaker 6: What happened there, Yeah, I mean this was sort of
Speaker 6: a suit from twenty twenty one where JP Morgan was
Speaker 6: claiming that Tesla owed them one hundred and sixty two
Speaker 6: million dollars tied to like stock warrant transaction and it
Speaker 6: was over a strike price. It was such a small
Speaker 6: amount of money, which is crazy because like I always
Speaker 6: think of Elon in terms of billions, not millions, and
Speaker 6: this one seemed relatively small.
Speaker 5: If it ain't fifty billion, what is It's nothing?
Speaker 1: Yeah, Anyway, they agreed to drop the lawsuit.
Speaker 6: And I think you have to think about like the
Speaker 6: judiciary as a whole, like which courthouses are all these
Speaker 6: suits heard in, and like why Tesla has moved to Texas.
Speaker 6: And I think that anytime there's a change in administration,
Speaker 6: you just start to see a lot of litigation wrap
Speaker 6: up because people think about the cost benefit analysis of
Speaker 6: continuing to litigate under a new administration when there could
Speaker 6: be new judges appointed in different courtrooms and.
Speaker 3: Max, you know, it's also just the calculus, as Danager said,
Speaker 3: it just a few million dollars or I don't know
Speaker 3: how many millions, But yeah, is it worth pursuing that
Speaker 3: when against the next president's first budy?
Speaker 5: But it's not, and it's not I don't even think
Speaker 5: it's that.
Speaker 4: I think it's that, you know, JP Morgan wants those
Speaker 4: one hundred and sixty two million dollars, but it very
Speaker 4: much also wants future fees that Elon Musk could pay
Speaker 4: and you know, in the.
Speaker 3: In the's, but it also presumably one of those future
Speaker 3: fees at the time it suited him.
Speaker 4: No, no, But my point is like I'm not saying
Speaker 4: you shouldn't pay your professional services providers, but businesses choose
Speaker 4: to not pay their professional service to providers all the time.
Speaker 4: And there are lawsuits just like this that are effectively
Speaker 4: like negotiations over how much money are going to be paid?
Speaker 4: Is he going to pay more in the future. And
Speaker 4: in the reports about this settlement, part of the reason
Speaker 4: that they're the rational for dropping is that there are
Speaker 4: future commercial arrange.
Speaker 6: Yeah, there's some kind of settlement agreement. Yeah, there's like
Speaker 6: an undisclosed settlement agreement.
Speaker 5: Okay, so.
Speaker 4: Yeah, yeah, they're saying that it's I forget the exact wording,
Speaker 4: but it's essentially with an eye to future commercial stuff.
Speaker 3: All right, Listen, we're gonna drop the lawsuits for now.
Speaker 3: They will keep coming up up again and again and again, so.
Speaker 5: Do not fret.
Speaker 3: And I want to talk a little bit about further
Speaker 3: signs of the shifting customer base for Elon's companies. You know, Sarah,
Speaker 3: yesterday Bloomberg we had a good story some of our
Speaker 3: colleagues did on how we're starting to see signs that
Speaker 3: conservatives are driving Model Wise and other vehicles. I suppose
Speaker 3: this is proof that at some level, at least anecdotal
Speaker 3: proof that this shift has begun.
Speaker 7: I mean, this is something we've been talking about for
Speaker 7: a while, ever since Elon started to move rightward his products.
Speaker 7: His companies are getting politically coodd too. And I guess
Speaker 7: they always were because Tesla's were at one point considered
Speaker 7: this environmental statement, right, like, you cared about climate change,
Speaker 7: you got a Tesla because you wanted to drive an
Speaker 7: electric car.
Speaker 1: You didn't want to use.
Speaker 7: Fossil fuels, and so liberals bought a lot of Tesla's,
Speaker 7: and now those same people are saying, oh my god,
Speaker 7: I bought the car that is backed by Elon Musk
Speaker 7: and I feel I feel like connected to Trump when
Speaker 7: I drive it around, even though I didn't vote for him.
Speaker 7: So on the one hand, you've got a lot of
Speaker 7: liberals trying to get rid of their Teslas, and then
Speaker 7: you also got a lot of conservatives saying, hey, maybe
Speaker 7: this is cool, right.
Speaker 3: It's cool, and they're buying them. And to Sarah's point,
Speaker 3: there Max, there has been a proliferation of these bumper
Speaker 3: stickers that some of these liberals on the coast who
Speaker 3: had bought their Teslas and are suddenly mortified by the
Speaker 3: fact that they own Tesla's, but they're not yet quite
Speaker 3: ready to get rid of their Tesla. So all these
Speaker 3: bumper stickers are out now. Some are tame and subdued.
Speaker 3: There's like as simple as love the car, not Elon,
Speaker 3: and there's the anti Elon Tesla club. Some are a
Speaker 3: little creative Elon ate my cat. And there are some
Speaker 3: that are just like blunt and aggressive Elon sucks, shut up. Elon,
Speaker 3: And then there are also some pro Elon stickers. If
Speaker 3: one is so inclined to by those, you have Elon
Speaker 3: Musk Free Speech Hero, Elon Musk making speech free again,
Speaker 3: and in Musk we trust, by the way, max up
Speaker 3: point one other thing out. There's not one that I
Speaker 3: could find. Zero bumper stickers on Elon Inc. Neither four
Speaker 3: or against that is.
Speaker 4: I think that's a failing of marketing.
Speaker 5: Don't we have.
Speaker 3: Don't we have an Don't we have an email address
Speaker 3: where people can send us ideas?
Speaker 5: So we need Elon Inc.
Speaker 4: At Bloomberg dot net. Tell us your ideas for bumper stickers.
Speaker 3: Ready, you love the show or hate the show, just
Speaker 3: send them in test us.
Speaker 7: To just have those bumper stickers at the at the dealership.
Speaker 4: Like my favorite stickers and the ones I've actually seen
Speaker 4: the most of are ones that say, effectively, I bought
Speaker 4: this before he went crazy classes, and I feel like
Speaker 4: that is sort of telling about the not only the
Speaker 4: sort of cultural signifiers around the brand, but also like
Speaker 4: the used car market. I mean, one reason we're seeing
Speaker 4: these bumper stickers is it's like not particularly easy to
Speaker 4: unload your used Tesla because of these discounts.
Speaker 5: They have these stickers on them.
Speaker 4: No, because over the lie last year and a half
Speaker 4: or so, as Tesla's sales have faltered to some extent,
Speaker 4: Tesla like rapidly dropped its prices, so huge price cuts.
Speaker 4: So people are looking at taking a huge haircut if
Speaker 4: they sell their Model three like it. This really like
Speaker 4: devastated the price for the used Tesla market. So oh
Speaker 4: and oh, by the way, there aren't that many comparably
Speaker 4: priced Evy alternatives. So you're in this situation where, gee,
Speaker 4: you'd really like to sell your Tesla, but you but
Speaker 4: there's no good alternative. You can't get a good return,
Speaker 4: There's not there's not a comparably priced ev with with
Speaker 4: comparable things. So if you're a liberal who's like a
Speaker 4: little bit upset about the electric resolution is you can't
Speaker 4: sell your Tesla. You just have you get a bumper sticker.
Speaker 6: So you just have to buy a bumper sticker and
Speaker 6: like virtue signal that like you like bought the car
Speaker 6: before Elon.
Speaker 1: Went crazy again.
Speaker 6: It's just yeah, I think it's very funny. I mean,
Speaker 6: here in the Bay Area, I see the bumper stickers
Speaker 6: all the time. But musk shift to the right has
Speaker 6: been underway for years. He moved to Texas in twenty twenty.
Speaker 6: He has been crapping on California ever since. Like Tesla's
Speaker 6: early adopters, like the consumers who basically like helped build
Speaker 6: the brand, are largely like Hollywood people and tech people
Speaker 6: in Silicon Valley. Some of them are environmentalists, a lot
Speaker 6: of them are frankly just tech people who really like
Speaker 6: the car. And then you have like libertarians who wanted
Speaker 6: the US to be independent from oil. But but yeah, no,
Speaker 6: I mean this has been underway for a while. You
Speaker 6: can buy the stickers. You can buy the bumper stickers
Speaker 6: on Amazon. Now it's like a thing.
Speaker 5: Yeah, they're all over the place.
Speaker 3: I mean, I think somebody should maybe they're out there,
Speaker 3: somebody like specially to sell to the cyber truck buyers,
Speaker 3: should have a sticker that says I bought this, you know,
Speaker 3: cyber truck after I realized you know who elons.
Speaker 6: I mean, I think how that impacts sales overall in
Speaker 6: the US going forward is going to be super interesting.
Speaker 6: I mean, Tesla is headed towards its first year over
Speaker 6: year decline because of declining sales in the United States.
Speaker 3: The data I thought that the delivery data out of
Speaker 3: China that came out overnight for November wasn't great either, right, I.
Speaker 6: Mean, it's okay, but like it's not going to offset
Speaker 6: what is predicted to be a decline in the US
Speaker 6: and in Europe. But it's really hard to tease out,
Speaker 6: like is the decline because of Elon's politics or is
Speaker 6: it because they frankly have like a very stale lineup
Speaker 6: and like the cyber truck is still not in like
Speaker 6: super high volume. And so I think what's what's weirder
Speaker 6: is just that all of Elon's products are so polarizing.
Speaker 6: Like we've talked about Tesla, but I mean, Sarah, look
Speaker 6: at X, Like now if you're on X, it's like, oh,
Speaker 6: does that mean you support Trump? Or does that mean
Speaker 6: that you support the administration. We've seen this like huge
Speaker 6: surge to Blue Sky after the election, and it's remarkable
Speaker 6: that someone has so polarized the brands of his own company.
Speaker 7: And what's funny is the X is very It's a
Speaker 7: very similar situation to Tesla, where where people are polarized
Speaker 7: about the product but they can't quite decide what to
Speaker 7: do about it. You know, people are hesitant to leave
Speaker 7: all their followers on X. You're seeing these these open
Speaker 7: debates about like, well, you know, maybe I should stay
Speaker 7: on X because somebody needs to talk to these these
Speaker 7: people and help them understand where they're going wrong. And
Speaker 7: somebody needs to witness the dissent into fascism of America. Right.
Speaker 7: There's just a lot of justification and a lot of
Speaker 7: thinking about you know, is it better to delete my
Speaker 7: account and go to Blue Sky? Is it better to
Speaker 7: stay on X and and fight? But that means I'm
Speaker 7: giving elon my attention to my money.
Speaker 3: Are there any conservatives by the way, I'm Blue Sky
Speaker 3: or in any kind of.
Speaker 7: Mutual anywhere that people can fight with people they disagree
Speaker 7: with Online, You're gonna have all kinds of people, right.
Speaker 7: That was always one of the one of the draws
Speaker 7: of X. It's more fun than true social because there
Speaker 7: are people who disagree and you can go in their
Speaker 7: applies and explain why you think what you think.
Speaker 3: Okay, just to bring it back to Tesla again for
Speaker 3: a second and a theory, I have that for you
Speaker 3: guys to opine on and blow up and Max with
Speaker 3: some of his comments earlier. Max already has begun the
Speaker 3: process of blowing up this theory. But the theory goes
Speaker 3: like this, that what if Elon's turn to the right
Speaker 3: actually winds up rapidly accelerating EV adoption in America, that.
Speaker 5: The liberal elites or the liberal.
Speaker 3: Buyers let's say, who are getting rid of their Tesla
Speaker 3: as they own or are refusing to buy a new Tesla,
Speaker 3: well they were just going to buy some other evy.
Speaker 5: Those people are going to buy an ev regardless.
Speaker 3: And by shifting to the right as Elon has, he
Speaker 3: is bringing in a whole new buyer base in red
Speaker 3: states who otherwise never would have looked at EV's at all.
Speaker 4: Max's Smith, I think this is like fan fiction basically,
Speaker 4: Like you know, we've we've talked about versions of this theory,
Speaker 4: I think going back over a year, and you can
Speaker 4: sort of see because like Elon Musk, he sold a
Speaker 4: lot of cars to liberals, he's kind of tapped that
Speaker 4: market out. Meanwhile, you have a bunch of red states
Speaker 4: where there isn't a lot of EV adoptions. Therefore, this
Speaker 4: all makes perfect sense now that would I guess like
Speaker 4: you could kind of get behind that theory if not
Speaker 4: for the fact that Elon Musk just became a campaign
Speaker 4: surrogate for a candidate who ran in part on the
Speaker 4: idea that EV's are bad, Like Trump went on the
Speaker 4: stump over and over again and said that EV's were
Speaker 4: no good and that we need to drill baby dress.
Speaker 4: That's not only that, it's not just Trump, it's Elon
Speaker 4: Musk himself who's saying this, who's saying we are pivoting
Speaker 4: away from electric cars. If you think of us as
Speaker 4: a car company, you got it twisted. We are an
Speaker 4: AI company now, so it does make some sense. And
Speaker 4: I just one other thing, Like, it's not like Tesla
Speaker 4: never had conservatives driving them. I've read some of these
Speaker 4: articles about conservative car buyers and who are like really
Speaker 4: enthusiastic about Tesla, and I'm like, it's like they're like
Speaker 4: a lot of professionals, wealthy people who happen to vote
Speaker 4: for Trump and also Arab Tesla. And I have to
Speaker 4: ask number one, yeah, would they really have a lot
Speaker 4: of test And second, anyone who's followed this company for
Speaker 4: a long time knows that there have always been kind
Speaker 4: of off the grid type, you know, militia types who've
Speaker 4: liked this right, They like the idea of of like
Speaker 4: not relying on yeah, energy dependency, d like libert There's
Speaker 4: always been a libertarian flair to this company. I think
Speaker 4: what's happened and this is you know, unfortunate for the
Speaker 4: company and for the mission, which is that Tesla went
Speaker 4: from being like a cool brand to bringing kind of
Speaker 4: a cringe brand, being a brand that is associated very
Speaker 4: closely with one political candidate, when whereas before it kind
Speaker 4: of transcended those bounds. And and yeah, that might lead
Speaker 4: to kind of a bump now, but is it going
Speaker 4: to be good in the long term. I don't know.
Speaker 3: We need the data though, ultimately, Dana and the data
Speaker 3: I guess just will come our way over time.
Speaker 5: Well.
Speaker 6: Yeah, and just to be clear, the data is just
Speaker 6: sales data. Doesn't say why someone bought a Tesla. Doesn't
Speaker 6: say I bought a Tesla because Elon Musk is like.
Speaker 3: But it should give us we can get if we
Speaker 3: work hard enough at it, we can get geographical breakdown.
Speaker 5: Can we not.
Speaker 6: Yeah, you can get geographical breakdown eventually. But I'm just
Speaker 6: saying that, like, there's no like, all of these stories
Speaker 6: are just anecdotal, and ultimately what matters to Wall Street
Speaker 6: is how many frickin' cars.
Speaker 1: Did they sell in twenty twenty four?
Speaker 5: Not many, is the answer, actually?
Speaker 6: And is it more or less than last year? And
Speaker 6: if it's less, that's a problem. But at the same time,
Speaker 6: to Max's point, like Elon doesn't care anymore, like Elon
Speaker 6: is bored of making cars. He wants Tesla to be
Speaker 6: an AI company and a robotics company.
Speaker 7: Do you think that Elon's environmental mission is true to
Speaker 7: him or true to the business, Like was that a
Speaker 7: means of selling Tesla's early on or was that something
Speaker 7: he actually cares about? And if so, is he going
Speaker 7: to change Trump's mind on Drill, Baby Drill.
Speaker 3: We are at a time we're going to wrap it there,
Speaker 3: But I do want to remind our listeners again that
Speaker 3: we need your Elon Inc. Bumper sticker ideas. They go
Speaker 3: Max to, Yeah, it's Elon Inc. At Bloomberg dot net.
Speaker 4: And you know we are looking for not just bumper
Speaker 4: sticker ideas, although definitely keen on those, but also slogans,
Speaker 4: product extensions, merge and really anything else about the show.
Speaker 4: We've already had a few emails come in, and I think,
Speaker 4: like next week maybe we'll.
Speaker 5: Do it quick Singers Yeah, we'll We'll.
Speaker 4: Go through some of them and respond to some of
Speaker 4: your ideas and maybe some of your criticisms. We will
Speaker 4: take any slogans I would even put If someone sends
Speaker 4: a slogan, I might even put.
Speaker 5: It on the back of my Honda. Odysty Absolutely, let's
Speaker 5: do it.
Speaker 4: I started listening to this podcast before they.
Speaker 3: Went crazy, exactly, Max, Sarah Danna, thanks.
Speaker 1: For joining, Thanks for having me. Always a pleasure, great
Speaker 1: to be here.
Speaker 3: This episode was produced by Stacy Wang. Anna Maserrakus is
Speaker 3: our editor, and Rayhan Harmanci is our senior editor. The
Speaker 3: idea for this very show also came from Rayhan. Blake
Speaker 3: Maples handles engineering, and Emma Sanchez fact checks. Our supervising
Speaker 3: producer is Magnus Henrikson. The elon Ink theme is written
Speaker 3: and performed by Taka Yasuzawa and Alex Sugiura. Brendan Francis
Speaker 3: Newnham is our executive producer, and Sage Bauman is the
Speaker 3: head of Bloomberg Podcasts. A big thanks to our supporters
Speaker 3: Joel Weber and Brad Stone. I'm David Papadopoulos. If you
Speaker 3: have a minute, rate and review our show, it'll help
Speaker 3: other listeners find us see you next week.