Speaker 1: Well, Elon Musk gives now the richest person on the planet.
Speaker 2: More than half the satellites in space are owned and
Speaker 2: controlled by one man.
Speaker 1: Starting his own artificial intelligence company.
Speaker 2: Well, he's a legitimate super genius. I mean legitimate. He says.
Speaker 2: He's always voted for Democrats, but this year it will
Speaker 2: be different.
Speaker 3: He'll vote Republican.
Speaker 2: There is a reason the US government is so reliant
Speaker 2: on him.
Speaker 1: Elon Musk is a scam artist and he's done nothing.
Speaker 2: Anything he does is fascinating the people. Welcome to Elon Inc.
Speaker 2: Where we discuss Elon Musk's vast corporate empire, his latest
Speaker 2: gambits and antics, and how to make sense of it all.
Speaker 2: I'm your host, David Papadopolis. We were surprised this week
Speaker 2: to learn from our colleague Sharen Gafari that GROC, the
Speaker 2: AI chatbot from Elon Musk, this very new AI company,
Speaker 2: is actually giving programs like Chad GBT a serious run
Speaker 2: for their money. We were less surprised when we saw
Speaker 2: the EU as investigating X for illicit content and disinformation
Speaker 2: on the platform, and we did raise our eyebrows when
Speaker 2: a recall alert for Tesla's autopilot software went out last week. Now,
Speaker 2: this wasn't the kind of recall we're all used to.
Speaker 2: The company called for users to update their cars software remotely.
Speaker 2: It felt like a peek into the future of cars.
Speaker 2: To discuss all of this and more, we've beamed in Sharene,
Speaker 2: who reports on AI for US in San Francisco. Hello,
Speaker 2: hither and Max Schafkin, senior reporter and editor at Bloomberg BusinessWeek.
Speaker 4: Hello David, Hello Max.
Speaker 2: Later on, Dana Hall, our longtime Tesla reporter, will join
Speaker 2: us as well. Okay, so now Max, we know, okay
Speaker 2: that recently you had a little cameo and last week
Speaker 2: tonight with John Oliver, they found some old tape that
Speaker 2: they put on.
Speaker 4: So in that way, he's kind of the Henry Ford
Speaker 4: of space.
Speaker 2: But you know, Max, we also pulled some old tape
Speaker 2: of yours on our very first podcast, our debut episode,
Speaker 2: in which you said this about groc.
Speaker 1: Until people start actually using this, I think it's worth
Speaker 1: like thinking about this as vaporware or not even taking
Speaker 1: it seriously as a real product.
Speaker 2: All right, Well, stand okay, so Max, we'll give you your time.
Speaker 2: Just pipe down, you'll get your chance to respond. But Sharen,
Speaker 2: you've tried groc Out for a few days recently. What
Speaker 2: did you find?
Speaker 3: It exceeded my expectations? I like max given first of all,
Speaker 3: how how much other companies had leg up over Elon
Speaker 3: with this one right open a eyes chat SPT came
Speaker 3: out over a year ago. Google's been working on AI forever.
Speaker 3: I didn't think in a matter of a couple months
Speaker 3: and a small team could spin up something that would
Speaker 3: significantly be better than any of the other AI chatbots
Speaker 3: out there. However, I did find that, especially with one
Speaker 3: important use case for me, which is summarizing real time events,
Speaker 3: Rock performed really well.
Speaker 2: And when you say really well, a tell us what
Speaker 2: that looked like? What really well looked like? And is
Speaker 2: really well better than the competition?
Speaker 3: Yes, I should say really well comparative to other chatbots
Speaker 3: that are out there right now, I think none of
Speaker 3: these tools are anywhere near perfect. They're still wrong a
Speaker 3: good percentage of the time. I will caveat that my
Speaker 3: test was not a scientific one. You know, I used
Speaker 3: it for three days and asked a bunch of news
Speaker 3: questions basically, and you know how it did better? Was
Speaker 3: that a lot of times? And I've written about this
Speaker 3: in the past. The mainstream chatbots out there, the leading
Speaker 3: moost cutting edge ones can be really smart if you
Speaker 3: ask them to solve, you know, a math problem or
Speaker 3: to write you a poem in the style of Shakespeare.
Speaker 3: But when you have some about current events, they can
Speaker 3: just totally get stumped and flub the answer because even
Speaker 3: as they're even if they're being updated with real time information,
Speaker 3: it takes training to be able to tell you know
Speaker 3: that the chat bought hey, this is right, this is wrong,
Speaker 3: and you can't constantly be training something in real time
Speaker 3: at least they haven't figured that out quite yet. And
Speaker 3: so where Grock excelled was that when I asked it
Speaker 3: about the news, it actually was able to give me,
Speaker 3: in my experience, a better answer, more or less than
Speaker 3: the other ones out there, like chat, Scheept, your Google's.
Speaker 2: Bard and so you're talking about right, you asked the
Speaker 2: things about the Israel Hamas war, you asked the things
Speaker 2: about the cop twenty eight climate summit, and it did
Speaker 2: write better often than Chat, chapt and Bart. So Max Chafkin, what.
Speaker 1: Say you, I agree with everything Shreena's saying. I mean
Speaker 1: it's a really.
Speaker 2: You retract your statements from Wakwa.
Speaker 4: No, because I do.
Speaker 1: First of all, it's not clear how quickly they put
Speaker 1: this thing together, like it might have been true, you know,
Speaker 1: four weeks ago when I said it, and maybe they
Speaker 1: actually moved really quickly. I also think, you know, it's
Speaker 1: sort of hard to know how to think about this
Speaker 1: because on one hand, you know, it's like, Wow, what
Speaker 1: an impressive showing by Elon Musk. He's still got it right,
Speaker 1: Like he can small team, he's able to, you know,
Speaker 1: despite all of the crazy things swirling around him, he's
Speaker 1: able to recruit competent engineers and who are able to
Speaker 1: then build a product.
Speaker 4: I mean, the other way looking.
Speaker 1: At is I guess maybe chat GPT wasn't quite as
Speaker 1: good as we thought. Maybe like that thirteen billion dollars
Speaker 1: that open Ai spent, or you know, this enormous amount
Speaker 1: of money, many years spent. The fact that one guy
Speaker 1: could replicate it in a matter of I don't know,
Speaker 1: we don't know exactly how long they built this, but
Speaker 1: probably a few months.
Speaker 4: What does that say about the state of the art.
Speaker 1: Maybe it's maybe these maybe these chatbots just aren't as
Speaker 1: great as they as we thought they were. Or maybe
Speaker 1: a better way to say it would be maybe these
Speaker 1: chatbots aren't as like sort of defensible as we thought
Speaker 1: they were. Maybe, like there's not that much unique in anything.
Speaker 2: There's not much of a n buffet terms of a
Speaker 2: moat around them as as one would have thought. I mean, now, sure,
Speaker 2: and you're you're saying you peppered it with news questions
Speaker 2: when and to to help you be up to date
Speaker 2: on what's going on in the in the open AI space,
Speaker 2: in the artificial intelligence space. How important is that functionality?
Speaker 2: Is that something that people would actually legitimately use it
Speaker 2: a lot for?
Speaker 3: Look, I think there's there's you know, you don't always
Speaker 3: need to know what's happening in right away, like right now.
Speaker 3: For example, if you're just interested in using these bots
Speaker 3: to code, to help you code, it doesn't really matter.
Speaker 3: Code doesn't you know, change minute by minute. But if
Speaker 3: you care, and when you think about when you use
Speaker 3: Google every day, right, how many times does it matter
Speaker 3: if information is fresh when you Google a lot of
Speaker 3: times it matters, like if you want to know when
Speaker 3: the super Bowl is or if you want to know
Speaker 3: like when to go to the movies, Like, so I
Speaker 3: asked it you know about Israel Amas war and I
Speaker 3: did that because in the past when I had asked
Speaker 3: Google's chatbot and chat Shept, it was flat out wrong.
Speaker 3: It was telling me, you know, in the p the
Speaker 3: heat of the war, it was telling me there's been
Speaker 3: a ceasefire, which was just not true. And when I
Speaker 3: asked GROC, it gave a pretty nuanced and correct answer.
Speaker 2: Well, exactly was that answer?
Speaker 3: It was pretty concise. It was about a paragraph. It said,
Speaker 3: you know, the war is continuing, there's no end in sight.
Speaker 3: It listed, you know, an estimate of the casualties and
Speaker 3: gave sources for those casualties. And you know, the reason
Speaker 3: I think that that GROC may be better with this
Speaker 3: and some of its competitors is because, first of all,
Speaker 3: it's willing to engage on some of the stuff. So
Speaker 3: when you asked Bart about the Israel mas war, for example,
Speaker 3: after Bard a couple of months ago, embarrassing.
Speaker 2: Or declined to comment.
Speaker 3: Basically Bard declined to comment, right, And then this is
Speaker 3: mind you after my reporting that it flunked on this
Speaker 3: question a few months ago, so now it seems like
Speaker 3: it's shut down the answer entirely to what's happening with
Speaker 3: Israel Amas war. Chech Pt did give a directionally correct
Speaker 3: answer actually performed better than I thought it would. But
Speaker 3: Groc's answer was more concise. It listed references better I thought,
Speaker 3: And I think a big reason for that is because
Speaker 3: it's pulling from from tweets or I should call them exposts.
Speaker 3: And you know, what was really surprising to me was
Speaker 3: that I thought, Okay, even if it's pulling from people's exposts,
Speaker 3: that a lot of them could be junkie. I mean,
Speaker 3: just looking at my own, for you feet as degraded
Speaker 3: in the past couple of months or a year, I
Speaker 3: should say. However, when I asked Rock, it seemed like
Speaker 3: it was filtering where a majority of vast majority of
Speaker 3: sources it was pulling from. The in these tweets or
Speaker 3: exposts were you know, mainstream news sources like Bloomberg, like
Speaker 3: the Financial Times, Sky News.
Speaker 2: Wait, which, so they're siting Bloomberg, Oh we love Grock,
Speaker 2: then Croc's great.
Speaker 3: Now, of course they're going to be right if they're
Speaker 3: signing Bloomberg.
Speaker 4: Now, Max, in.
Speaker 2: That opening episode, when you were expressing those concerns and
Speaker 2: and and your your you know the fact that you
Speaker 2: were a bit dubious about it, that was specifically one
Speaker 2: of the things you brought up that hey, if you're
Speaker 2: pulling from X, which is what GROC is going to
Speaker 2: largely be doing. And indeed, as as Sharen was saying
Speaker 2: that the content on X is taking a turn for
Speaker 2: the worst, how relyible can it be? So I guess
Speaker 2: maybe they've managed to come up with the formula to
Speaker 2: make this work.
Speaker 1: I mean to me, what's most from a sort of
Speaker 1: if you were an investor in one of Elon Musk's companies,
Speaker 1: or you were his friend or something, what will be
Speaker 1: most encouraging about this is that you have the rhetoric, right,
Speaker 1: you have Elon Musk talking twenty four to seven about
Speaker 1: the woke mind virus, and then you look at what
Speaker 1: grog is actually doing. I was reading Sharen's story and
Speaker 1: I saw Financial Times, Bloomberg, Wall Street Journal like Where's
Speaker 1: cat Turn? And you realize, like, this thing has the
Speaker 1: woke mind virus at least as Elon Musk has articulated it,
Speaker 1: and so clearly he is sick. He's able to you know,
Speaker 1: this would make you think, okay, maybe what's going on
Speaker 1: in his own personal you know, Twitter feed X feed
Speaker 1: is a performance and when it when it really matters,
Speaker 1: when it gets down to business, he's making better decisions
Speaker 1: or people underneath him are able to say, like, look like,
Speaker 1: let's not like exclusively compose these answers of like the
Speaker 1: right wing influencers that are you know, friends with Elon.
Speaker 2: Let's let's useables. So GROC is so far better than expected.
Speaker 2: It's doing well, It's passed some surprisingly some early tests.
Speaker 2: Scharene does does it matter though, like in terms of
Speaker 2: making this some way scalable monetizable in a way that
Speaker 2: matters for XAI and for X and for Musk. Yeah,
Speaker 2: is there is Does this have any actual import it?
Speaker 3: Could you Look, if X really builds a reputation for
Speaker 3: being the chatbot that will give you the most accurate
Speaker 3: information about the world as it's happening, I can definitely
Speaker 3: see that being monetizable or being a competitive asset. But
Speaker 3: it's quite you know, a paradox because at the same time,
Speaker 3: as you're pointing out, Musk is under fire for quite
Speaker 3: the opposite, right for you know, how unreliable some people
Speaker 3: are finding X to be. So it's kind of a
Speaker 3: hard sell too, even if Grok is exceeding expectations in
Speaker 3: this in this one area, it's the area of exact
Speaker 3: weakness for him right now in terms of X's perception.
Speaker 2: Now, Max, indeed you are in general you're dubious about AI,
Speaker 2: not just as it applies to Grock, but across the board.
Speaker 2: What's your take on this?
Speaker 1: I mean, I think, look in certain ways, it makes
Speaker 1: a lot of sense, just because Elon Musk needs to
Speaker 1: create some reason for people to use this site and
Speaker 1: to subscribe to X premium and Groc would be a
Speaker 1: way to do that.
Speaker 2: So who does indeed have access to GROC? Who can
Speaker 2: use Grok?
Speaker 4: Right now?
Speaker 1: I believe it's it's I hope I'm getting the branding right.
Speaker 1: I think it's ex Premium plus users. This is the
Speaker 1: higher tier from the.
Speaker 2: Twitter blue and apparently that group includes Scharene from what
Speaker 2: we can tell.
Speaker 1: Sharen, is it like twenty bucks a month or how much?
Speaker 1: How much are you show up?
Speaker 4: That's right, I'm a VIP users.
Speaker 3: I believe it's around sixteen dollars a month, and it
Speaker 3: is the highest package you can get on the pagement.
Speaker 3: And I got it specifically for this reason, mind you,
Speaker 3: not for my own vanity for the check mark. I
Speaker 3: got it just because I wanted to test out there
Speaker 3: likely story.
Speaker 1: I mean, there's some really interesting issues around corporate governance
Speaker 1: because it seems like Grock is a separate company, and
Speaker 1: yet clearly it's very closely tied in with X. It
Speaker 1: seems to be part of Elon Musk's plan to like,
Speaker 1: you know, save the value of his investment.
Speaker 4: So so I think that that's one thing.
Speaker 1: The other thing is, you know, for a long time,
Speaker 1: even going back to the to the old Twitter, everyone
Speaker 1: knew there was a lot of value in the data
Speaker 1: contained in tweets, and and Twitter had had a really
Speaker 1: reliable revenue stream. I think to some extent still does
Speaker 1: selling that data called the fire hose to companies that
Speaker 1: would essentially pay for it and analyze it and so
Speaker 1: on and and so you know, in certain ways, Grock
Speaker 1: is like a logical the logical next step. On the
Speaker 1: other hand, in other ways, the kind of Elon Musk
Speaker 1: media troll way he has undermined that he's undermined Twitter
Speaker 1: X as a sort of reliable record of sentiment, whereas
Speaker 1: now it's it's more like a reliable reliable record for
Speaker 1: sentiment in certain domains like sports and so on. I
Speaker 1: bet you Grock will be great on you know, the
Speaker 1: question of like which who to start in your fantasy
Speaker 1: league or whatever, and less reliable on some of these
Speaker 1: more controversial issues where we've seen really seen an impact
Speaker 1: of Elon Musk's you know, leadership, or and and sort
Speaker 1: of the the right wingification of the site, so.
Speaker 2: Max and and in that vein. Then the EU investigation
Speaker 2: of X which was announced i believe earlier this week
Speaker 2: for disinformation. They're investigating on disinformation and illicit content. Does
Speaker 2: this does the fact that GROC is a more reliable source,
Speaker 2: does this in any way, shape or form help them
Speaker 2: fend off that EU investigation? Are these totally unrelated things.
Speaker 1: You know, I'm not an expert on European technology regulation.
Speaker 1: I'm not sure that anybody is, but I know I
Speaker 1: don't think it does. I mean, this is very much
Speaker 1: a niche product. If what you're worried about is misinformation
Speaker 1: hate speech. By the way, in parts of Europe, of course,
Speaker 1: in Germany, certain kinds of hate speech that is you know,
Speaker 1: allowed in the United States is not allowed there. So
Speaker 1: if you're worried about like bad content broadcasting widely, this
Speaker 1: doesn't do anything to address that. Right, You're talking about
Speaker 1: a very narrow segment that has access to this thing
Speaker 1: using it in a narrow way. I don't think Sharene
Speaker 1: was the kind of person who was, like, you know,
Speaker 1: liable to like retweet, you know, the latest cat turd
Speaker 1: or whatever. And that's the kind of thing that European
Speaker 1: regulators are worried about, although I should correct myself and
Speaker 1: say I don't think they're specifically concerned about cat turn
Speaker 1: I'm using that right stand in for the overall issue
Speaker 1: of disinformation. When I was in college, we had a
Speaker 1: cat called Claws, and so it's kind of like the
Speaker 1: same thing.
Speaker 4: It's like a small part.
Speaker 2: I got to describe the whole cat, the whole understood,
Speaker 2: by the way, And I don't know if anybody saw
Speaker 2: this or anybody can make heads or tails of it.
Speaker 2: So there's there's another groc out there is this?
Speaker 1: Right?
Speaker 2: Is anybody?
Speaker 4: Yes?
Speaker 3: This is so confusing?
Speaker 2: This may help us, Serene.
Speaker 4: Okay.
Speaker 3: So Elon Musk's former partner and you know, mother to
Speaker 3: his children. So she came out with a rocket ship
Speaker 3: AI plushy from Curio named Grock, same name, and this
Speaker 3: came out. This was announced, you know, I believe let's see,
Speaker 3: just like was it last week? She announced on Instagram.
Speaker 3: It's this really cute looking you know, great, I saw it.
Speaker 3: It's not basically stufty animal, that's aipower.
Speaker 2: What kind of odd so Grock custody battle. Yeah, I
Speaker 2: don't know exactly, so GROC. So we're they're fighting over
Speaker 2: the kids and now they're fighting over Groc And yeah,
Speaker 2: it's odd. We went from having zero Gros in our
Speaker 2: lives the now multiple in the span of weeks. So
Speaker 2: do we think that this was deliberate?
Speaker 4: Like is this like? I mean, it would have to
Speaker 4: be right.
Speaker 1: There's no way that they could have just independently arrived
Speaker 1: at the same So I.
Speaker 3: Saw a techcrun headlines today that she had the trademark
Speaker 3: before he did or something. I don't know if that
Speaker 3: means you came up with it first.
Speaker 2: But we're going to say goodbye to Sharen for now.
Speaker 2: That was great train that we're going to have you
Speaker 2: back on both later in the show, and we're going
Speaker 2: to have you back on once you you know, test
Speaker 2: other elements of Groc will bring you back. Okay, So
Speaker 2: welcome back. Max and I are still here, and we're
Speaker 2: bringing in Dana Hall, our longtime Tesla reporter, to help
Speaker 2: us talk about the recall. Hello Dana, Hello Hello. Okay,
Speaker 2: So Tesla indeed recalled a few cars the other day,
Speaker 2: and you know, it's attracted a lot of attention because
Speaker 2: even my mother, who doesn't happen to own a Tesla,
Speaker 2: asked me what was going on, So Dana help her
Speaker 2: and everyone else out what exactly did Tesla do and
Speaker 2: how big a deal is this.
Speaker 5: So the first thing to know is that the word
Speaker 5: recall is a little bit of an anachronism when it
Speaker 5: comes to the auto industry these days. You hear recall
Speaker 5: and you think, oh my god, like all of these cars,
Speaker 5: like two million cars are going to be yanked off
Speaker 5: the roads. It's like, you know, like a baby's toy
Speaker 5: is recalled because there's a choke hazard. Like the idea
Speaker 5: of a recall makes you think that everything is off
Speaker 5: the market. But you know, now, like a lot of automakers,
Speaker 5: it's Tesla in particular, they can improve the product via
Speaker 5: over the air software updates. So, yes, this was a recall,
Speaker 5: but the remedy is that, you know, Tesla, free to consumers,
Speaker 5: is going to beam and over the air software update
Speaker 5: to everyone and the consumer does not need to do
Speaker 5: anything you don't need to bring it into a shop.
Speaker 5: You can still drive it. This is Tesla basically admitting, voluntarily,
Speaker 5: with Nitza's guidance, that autopilot is a problem and that
Speaker 5: drivers tend to get lulled into kind of like a
Speaker 5: sense of complacency, and that in certain conditions drivers may
Speaker 5: not pay attention. So the remedy is that Tesla's going
Speaker 5: to nag you a little bit more to keep your
Speaker 5: hands on the wheel and your eyes on the road.
Speaker 5: And I think the significance here is that, you know,
Speaker 5: for years, like Nitza has been working with Tesla to
Speaker 5: kind of improve the company's safety culture. They invest gated
Speaker 5: all these accidents where Tesla drivers on autopilot or with
Speaker 5: autopilot engaged seem to keep smashing into stationary fire trucks,
Speaker 5: and it was like, hmm, what's going on with that?
Speaker 5: And then you know, this kind of recall that was
Speaker 5: announced last week was basically the result of those two
Speaker 5: years of negotiations back and forth between the regulatory agency
Speaker 5: and the company.
Speaker 1: It's Dan's right that, like, you know, there you could
Speaker 1: read this in a very literal way and think, oh
Speaker 1: my god, they're going to take all these cars and
Speaker 1: you're gonna have to give them back and they're gonna
Speaker 1: be whatever rebil.
Speaker 2: A literal sense in the old in the old sense
Speaker 2: of the world.
Speaker 1: Well maybe, but I mean a lot of recalls work
Speaker 1: like this, Like if your Ikea bookshelf was recalled, they
Speaker 1: don't take the bookshelf back. They just send you like
Speaker 1: the new pins to like hold the shelves in better.
Speaker 1: But it is bad, and it's it's bad, especially in
Speaker 1: relation to what Elon Musk has been saying for years
Speaker 1: and years and years. We are so far away from
Speaker 1: the swaggering you know, we're gonna have robotaxis immediately. You
Speaker 1: barely have to look at this thing. You know, I
Speaker 1: before before going on, like I went back and you know,
Speaker 1: there was that that video that that they ran, the
Speaker 1: Painted Black video. I think Dana is that the right
Speaker 1: song from sixteen?
Speaker 5: Yeah.
Speaker 1: Yeah, it's just like awesome video where the cars like
Speaker 1: driving around and there's a little thing on the bottom
Speaker 1: of the screen says the driver is not doing anything,
Speaker 1: he's just there for legal reasons.
Speaker 2: Right as seven years ago, yeah exactly.
Speaker 1: And and then you had you had like you know,
Speaker 1: I think shortly after that, an adult film actress you know,
Speaker 1: tweeted a video, you know, having sex in a Tesla,
Speaker 1: and Elon Musk was like, ha ha, ha isn't it great?
Speaker 1: Another use and like this was all kind of an exaggeration,
Speaker 1: like they this thing doesn't work the way Elon Musk
Speaker 1: has said it works for years and years and years
Speaker 1: and years. And not only that, it doesn't work the
Speaker 1: way many many Tesla investors have sort of been assuming
Speaker 1: it would work. So in that sense, like I think
Speaker 1: this is damaging.
Speaker 2: But max to that point, right, because you're saying investor,
Speaker 2: Tesla investors have been and assuming that the technology works
Speaker 2: are going to work like that soon ergo. That is
Speaker 2: part of the very very lofty valuation that Tesla has.
Speaker 2: It's worth more than all the other automakers combined, and
Speaker 2: by a lot, but the stock price didn't move it
Speaker 2: all off this really well.
Speaker 5: The thing is that even though Tesla markets it as autopilot,
Speaker 5: the truth is that it is a level two system,
Speaker 5: which means that the driver is always in control. And
Speaker 5: there's like sort of daylight between how it's marketed and
Speaker 5: how it's actually used legally, Like if you get a
Speaker 5: Tesla and you read all the documents and even look
Speaker 5: at their website, they make it very clear that the
Speaker 5: driver is supposed to be in control at all times.
Speaker 2: But then presumably Knitz's concern though, is that no, you know,
Speaker 2: reasonable or typical user is actually going to read all
Speaker 2: the fine print, is that right? And so they are
Speaker 2: going to perhaps think that like, oh, whatever autopilot's got
Speaker 2: it is that right.
Speaker 5: I mean, there may be an increased risk of a
Speaker 5: collision if you are if auto steer is engaged and
Speaker 5: you're not fully paying attention.
Speaker 2: It says the new warning that you see what where
Speaker 2: does that pop up? By the way, that pops up
Speaker 2: one on your on your screen as you as you
Speaker 2: sit down in the car.
Speaker 5: So the remedy is that there will be increased visual
Speaker 5: alerts when you're driving, and like, if you ignore all
Speaker 5: the alerts completely, like the car could basically ground to
Speaker 5: a halt and pull you over.
Speaker 1: It.
Speaker 5: Tesla already kind of like nags drivers to pay attention.
Speaker 5: Now the nagging is more pronounced and more severe. But
Speaker 5: I mean, what's interesting is that you know, Tesla initiated
Speaker 5: this recall. This wasn't nitsa coming in and like forcing
Speaker 5: a recall, Tesla basically begrudgingly acknowledged it and said they
Speaker 5: would do it. They said that they didn't agree with
Speaker 5: Nitza's findings, but they were they were going along with it.
Speaker 1: I mean one reason for that is that there are
Speaker 1: worse things that NITSA could do, I mean, and and
Speaker 1: so like what well, I mean, they could force them
Speaker 1: to change the name. I mean, they could, they could
Speaker 1: like you know, they could they could more heavily regulate
Speaker 1: or try to stop the way Tesla has talked about
Speaker 1: these products, both autopilot and it's you know, quote unquote
Speaker 1: quote full self driving product, you know. And I think
Speaker 1: you could make an argument that both of those names
Speaker 1: are a little bit misleading. And you know, I think
Speaker 1: there's an assumption, right that this is going to sort
Speaker 1: of settle the matter for NITSA, although NITSA you know,
Speaker 1: released the stament saying that they are not necessarily like
Speaker 1: they have not closed this investigation.
Speaker 2: Yeah.
Speaker 5: And it's interesting too because there's a lot of litigation
Speaker 5: coming up on behalf of you know, drivers and their
Speaker 5: families who were injured or killed in accidents where autopilot
Speaker 5: was or was not engaged. And you have all these plaintiffs,
Speaker 5: attorneys who are very keen to kind of look at
Speaker 5: this recall as part of their strategy going forward. There's
Speaker 5: some big trials that are coming up or slated for
Speaker 5: twenty twenty four involving some of the more high profile
Speaker 5: autopilot cases.
Speaker 2: What do those lawsuits allege.
Speaker 5: Well, they basically alleged that the product is defective and
Speaker 5: that Tesla knowingly marketed this defective product that like lulled
Speaker 5: their these drivers into this false sense of complacency. But
Speaker 5: it's tricky because you know, from Tesla's perspective, like all
Speaker 5: of the fine prints says that you've got to pay
Speaker 5: attention and if you didn't, then then it's on you.
Speaker 5: And just you know, when you're in a car and
Speaker 5: there's something like autopilot engaged, like you know, as a driver,
Speaker 5: it can be confusing, like in terms of how much
Speaker 5: is it actually capable of when do you take control?
Speaker 5: It's like that murky middle it's not a full robotaxi,
Speaker 5: but it's it's helping you like keep lanes and you know,
Speaker 5: like keep speed, and you know it's it's it's a
Speaker 5: driver assistance project. But to Max's point, a big part
Speaker 5: of the valuation of Tesla is the promise of robotaxis,
Speaker 5: and Musk raised billions of dollars from Wall Street with
Speaker 5: that idea, and like a full robotaxis always kind of
Speaker 5: right around the corner. And that's been going on like
Speaker 5: year after year.
Speaker 4: Now.
Speaker 1: Yeah, I was gonna say, that's a regulatory problem, like
Speaker 1: getting we like, they are so far away from getting
Speaker 1: the federal government to say, okay, you can use your
Speaker 1: Tesla as a robotaxi. I mean we've seen you know,
Speaker 1: Cruise essentially like layoff a huge sex segment of the
Speaker 1: company basically slammed the brakes on its robotaxi business. It
Speaker 1: really just seems like, you know, good for Elon to
Speaker 1: solve this problem, but again, you are so far away
Speaker 1: from what that ultimate goal is, which is you know,
Speaker 1: the driver's not looking at all.
Speaker 2: Yeah, and I mean to go back to twenty sixteen,
Speaker 2: which was your reference to that ad that you remembered
Speaker 2: from back then, I remember being involved in a story
Speaker 2: at the time absolutely wasn't just a Tesla thing, but
Speaker 2: across the board, there was this sense out there in
Speaker 2: the industry that like, you know, we're days, we're hours
Speaker 2: away from from everybody, just you know, sitting in the
Speaker 2: backseat and sleeping while their car drives. Yeah, that was
Speaker 2: a myth.
Speaker 4: By the way, that was caused.
Speaker 1: You know, I've done some reporting on this that was
Speaker 1: caused in part by Elon because because Elon went out
Speaker 1: there and said that that this is like definitely gonna happen,
Speaker 1: then you had other CEOs promising to buy certain numbers
Speaker 1: of Tesla. I believe it was a CEO of a
Speaker 1: big ride sharing company promised to buy you know, big,
Speaker 1: big quantity of of Tesla's and that caused everyone to
Speaker 1: make models right showing enormous sales for you know, like
Speaker 1: like it caused this whole like Wall Street apparatus to
Speaker 1: like kick into gear and develop all these justification.
Speaker 2: Wall Street military industrial costs, and a.
Speaker 1: Lot of that has kind of has gone away, like
Speaker 1: people have sort of woken up to the fact that,
Speaker 1: like this stuff hasn't happening as quickly as it has.
Speaker 4: Accepted.
Speaker 1: One important exception, which is test that'sl stock brash. So
Speaker 1: it's probably worth saying that. You know, there's this other
Speaker 1: case going on, which is the case of the Nicola
Speaker 1: founder who has been found guilty of defrauding investors around
Speaker 1: you know, basically the capabilities of this what was essentially
Speaker 1: a vapor ware truck now much much more serious case.
Speaker 5: I mean, and look, investors love who investors who have autopilot,
Speaker 5: I mean a lot of them love it. They see it,
Speaker 5: they see it getting better, they experience it getting better.
Speaker 5: They feel like, Okay, Elon might be wrong on his timelines,
Speaker 5: but if anyone's going to figure out this problem, it
Speaker 5: will be him. And Tesla has a lot of data.
Speaker 5: I mean, that's the thing. The other thing, like you know,
Speaker 5: Weimo and all these other companies that kind of tried
Speaker 5: to do full robotoxis are you know, training small numbers
Speaker 5: of vehicles in these kind of geofence locations, whereas Tesla
Speaker 5: is learning from all the autopilot data that it is
Speaker 5: just unleashed on the universe. And you know, they've got
Speaker 5: a really big fleet now, so their model is based
Speaker 5: on a lot more real world data.
Speaker 2: All right, So last question on this topic that I
Speaker 2: have for both of you is, and this is kind
Speaker 2: of brings us back to the beginning of the conversation
Speaker 2: on it is so is recall then in the end
Speaker 2: the right word and is it the word we're going
Speaker 2: to use going forward on something like this, Dana.
Speaker 5: You could say a software recall, because ultimately the remedy
Speaker 5: is to update the software. You could say a software recall.
Speaker 4: It's a recall. It's what I mean this whole conversation
Speaker 4: about it. Is it a recall?
Speaker 1: Yeah, there are lots of recalls that that are satisfied
Speaker 1: without taking the product in. But like if you're if
Speaker 1: you're having to like make a change to your product,
Speaker 1: that is because it's unsafe.
Speaker 4: And that's what it's just saying.
Speaker 2: So sharene welcome back. Now. You need to know that.
Speaker 2: One if you hear that is a source of never
Speaker 2: ending raging debate on the show is the looming death
Speaker 2: match cage match between Elon Musk and his rival Mark Zuckerberg.
Speaker 2: Max has very strong opinions, I have very strong opinions,
Speaker 2: Dana and Sarah Friar. Who's not with us? I think
Speaker 2: we're crazy and should move on and do other things
Speaker 2: with our lives. Sharen, who do you think wins this
Speaker 2: match when it happens?
Speaker 3: It's tough because I mean, look, Elon's a bigger guy, right,
Speaker 3: he's six to one.
Speaker 2: Sucks he's seven. But I've been saying let her answer,
Speaker 2: So who wins.
Speaker 3: But I think Mark Zuckerberg and look, Mark Zerberg also
Speaker 3: recently had an injury, So.
Speaker 2: Flip flow, who's gonna you're hem and Han who's gonna win?
Speaker 4: Okay, okay on a good day.
Speaker 3: I think Mark, if he's recovered from his injury, I
Speaker 3: think it suck because I think he's trained for this conditionally.
Speaker 1: He posted on Instagram that he's doing rehab. He's going
Speaker 1: to be better than ever.
Speaker 2: So sucked it.
Speaker 4: Okay, good, something that'll keep in mind.
Speaker 2: But we decided to just see just how brilliant Groc is. Right,
Speaker 2: we said, why don't we say why don't we hit
Speaker 2: Grock with the question. So, Scharen, you did you asked
Speaker 2: Groc who will win the fight? And it told you what.
Speaker 3: It said. It also, like myself, gave a very kind
Speaker 3: of reasoned response, and it said, you know, listen out
Speaker 3: that Zuck is smaller. He gave his hide his weight.
Speaker 3: It said, as for their fighting styles, Zuckerberg's jiu jitsu
Speaker 3: training could give him an advantage in grappling and ground fighting,
Speaker 3: while Musk's height and reach advantage could be useful in striking.
Speaker 2: Very clinical atwer distance.
Speaker 3: Wow yeah, And it said ultimately, the outcome of the
Speaker 3: fight would depend on various factors such as training, preparation,
Speaker 3: and strategy. So let's wait and see if this hypothetical
Speaker 3: match ever becomes reality.
Speaker 2: So a non answer, that's a lay of answer, and
Speaker 2: it says Musk is known for his his interest in
Speaker 2: physical fitness, eh and martial arts. What it doesn't say
Speaker 2: is that Musk is a life long brawler, which he's
Speaker 2: been fighting since he was you know, since he got
Speaker 2: out of the crib, and that's why he's going to
Speaker 2: win any of it. It's kind of indeed, Sharen, it's
Speaker 2: kind of a lame answer. So he might have done
Speaker 2: great on the news questions the cage match answer, I
Speaker 2: give it a zero one.
Speaker 3: Yeah, here's the thing. They advertise it as a chat
Speaker 3: bought with a rebellious streak right and ready to answer
Speaker 3: spicy questions. And you know, you would think on something
Speaker 3: like this it would weigh in. By the way, I
Speaker 3: fact checked Elon Musk's height just now.
Speaker 4: Correction.
Speaker 3: According to the Internet, he is six ' two, not
Speaker 3: six ' one, so Grock maybe even underestimated his height.
Speaker 2: Okay, enough with the cage match talk. Let's end it there.
Speaker 2: Thanks for listening. To Elon Ing and thanks to our
Speaker 2: panel Scharene Dana Mac.
Speaker 5: Great to be here, always a pleasure, Thanks for having me.
Speaker 2: This episode was produced by Stacy Wong. Naomi Shavin and
Speaker 2: Rayhan Harmansi are senior editors. The idea for this very
Speaker 2: show also came from Rayhan. Blake Maples handles engineering, and
Speaker 2: we get special editing assistants from Jeff Grocott. Our supervising
Speaker 2: producer is Magnus Henrickson, thanks a bunch of BusinessWeek editor
Speaker 2: Joel Weber. The Elon Inc. Theme is written and performed
Speaker 2: by Taka Yasuzawa and Alex Suira. Sage Bauman is the
Speaker 2: head of Bloomberg Podcast and our executive producer. I am
Speaker 2: David Papadopolis. If you have a minute, rate and review
Speaker 2: our show, it'll help other listeners find us. See you
Speaker 2: next week.