Speaker 1: Bloomberg Audio Studios, Podcasts, radio news. Let me tell you
Speaker 1: we have a new star.
Speaker 2: A star is born Elon up On mars Juson Kennemy.
Speaker 3: He is the Thomas Edison plus plus plus of our age.
Speaker 4: Probably his whole life is from a position of insecurity.
Speaker 3: I feel for the guy.
Speaker 1: I would say ninety eight percent really appreciate what he does.
Speaker 4: But those two percent that are nasty, they are I'll
Speaker 4: pay in four post.
Speaker 1: We were meant for great things in the United States
Speaker 1: of America, and Elon reminds.
Speaker 2: Us of that we don't have a fourth branch of
Speaker 2: governments called Elon Musk.
Speaker 1: Welcome to Elon Ang, Bloomberg's weekly podcast about Elon Musk.
Speaker 1: It's Tuesday, March eighteenth. I'm your host, David Papadopolis. Now
Speaker 1: this week has mercifully given us a bit of a
Speaker 1: break from the non stop barrage of Elon Indoze news.
Speaker 1: But that doesn't mean things are quiet in the Musk Empire.
Speaker 1: There's been all sorts of news on the SpaceX front,
Speaker 1: and we'll start off there, and then Amanda Mall will
Speaker 1: join us to talk about a terrific piece you just
Speaker 1: pen for BusinessWeek about the epic brand destruction. Elon has
Speaker 1: unleased at Tesla to talk about everything SpaceX. We have
Speaker 1: our two regulars, Max Chafkin and Dana Hall. Maxilo to you, Hello, David, Dana,
Speaker 1: how are you hello?
Speaker 4: Hello?
Speaker 1: Now, I know that I often say on this show,
Speaker 1: I know nothing about what we're about to talk about,
Speaker 1: but I truly and when it comes to SpaceX, I
Speaker 1: truly know nothing about this. So you guys are going
Speaker 1: to help me like you're going to help our listeners. Dana,
Speaker 1: the stranded astronauts up there at the space station are
Speaker 1: coming home courtesy of Elon. Musk tell us about it.
Speaker 3: Well, First of all, the phrase stranded is something that
Speaker 3: NASA has kind of pushed back on.
Speaker 1: They're stranded, they're stranded and miserable.
Speaker 3: I mean, I know that journalists love to say that
Speaker 3: they're stranded and they're stuck, but the truth is that
Speaker 3: they're doing research and they're there because they want to
Speaker 3: be there. And yes, they were supposed to come home
Speaker 3: on a Boeing Starliner craft. NASA made the decision not
Speaker 3: to send them home on the Boeing craft, So now
Speaker 3: they are coming home on a SpaceX Dragon capsule. And
Speaker 3: this is a big win for Elon because it kind
Speaker 3: of plays into this narrative that quote unquote SpaceX is
Speaker 3: rescuing the astronauts, and yeah, I mean they are. They
Speaker 3: are bringing them home, and that's a huge win for Elon.
Speaker 3: And SpaceX has a brand as like the most reliable
Speaker 3: way to get to and from the space station.
Speaker 2: NASA has, as Dana is saying, a reliable way to
Speaker 2: get astronauts to and from the International Space Station it
Speaker 2: is SpaceX. It is also and separately attempting to find
Speaker 2: a second way. Now that is very annoying to Elon
Speaker 2: Musk since he essentially has a monopoly on this business.
Speaker 2: So as they've been developing this, Musk has been at
Speaker 2: pains to spin this as some kind of huge failure,
Speaker 2: and it is. It is definitely a setback for Boeing.
Speaker 2: But NASA could have sent these astronauts home much sooner
Speaker 2: if it had wanted to. It chose not to, And
Speaker 2: as Dan is saying, they chose to be there.
Speaker 1: Okay, fine, so you guys insist that they're not stranded,
Speaker 1: but they are. We can agree that they are coming home.
Speaker 1: They're not.
Speaker 4: They're they're traveling now, They're they're hurtling through.
Speaker 1: As we speak through the void of the sound over
Speaker 1: there that I hear, is that the sound of them
Speaker 1: hurtling through space.
Speaker 4: By the time listeners hear this podcast, they may splash ocean.
Speaker 3: Yeah, so the astronauts are on their way home. I mean,
Speaker 3: they are in the capsule and they are expected to
Speaker 3: splash down, like Tuesday evening. They will splash down Tuesday.
Speaker 1: Around the time this podcast splashes down as you're listening.
Speaker 1: A splashdown is is a term that everybody loves to
Speaker 1: use with these things. Right, there's no other way to
Speaker 1: come back from the space station if you're not you know,
Speaker 1: beyond splashing again.
Speaker 3: Okay, David, you know you realize it's because they are
Speaker 3: landing in the ocean. Like it's cost.
Speaker 1: I'm aware of that, but is in every case it's
Speaker 1: separate news. Starlink, a key division of SpaceX, is getting
Speaker 1: a competitor or Max Competitive Tours. Tell us about it, all.
Speaker 2: Right, Yeah, so there's a bunch of stuff happening around Starlink,
Speaker 2: and in particular around Starlink. Competitors is a new spinoff
Speaker 2: from Alphabet, the parent company of Google, which is called.
Speaker 4: T A A RX.
Speaker 2: I guess a titara is how you say, I don't
Speaker 2: know how to say it. It is a high speed
Speaker 2: internet company. It does not use satellites. It uses I'm
Speaker 2: not etting this up. It uses lasers that are mounted
Speaker 2: on towers. Apparently they can send high speed data, very
Speaker 2: long rate a laser, essentially like fiber optic cables, but
Speaker 2: in the sky. And this is being spun as a
Speaker 2: potential Starlink competitor. This is the thing that other technology
Speaker 2: company have talked about. It is not a direct competitor
Speaker 2: starting What it is is another potential way to deliver
Speaker 2: high speed internet to people in rural areas, which is
Speaker 2: like the main use case for Starlink. Now, I want
Speaker 2: to say two things. One is this is like very
Speaker 2: very speculative. The company, according to the report in the Verge,
Speaker 2: which is the one that we all saw, has like
Speaker 2: two dozen employees. Google has been trying to find ways
Speaker 2: to provide broadband internet to rural areas for a very
Speaker 2: long time, with.
Speaker 4: Very little success.
Speaker 2: This actually had its roots in their balloon Internet program,
Speaker 2: which you may or may not remember.
Speaker 1: I don't.
Speaker 4: That did not end well.
Speaker 2: This is not how like you know you're going to
Speaker 2: log on to Facebook and you need to.
Speaker 1: Said that the Balloon Internet program.
Speaker 2: Did not want Now I want to say this though
Speaker 2: this is again very speculative, not worth banking on at
Speaker 2: the moment.
Speaker 1: That said, but a window into something.
Speaker 2: Well, it shows you number one, that there are multiple
Speaker 2: ways for companies to go after Starlink. We often talk
Speaker 2: about Elon Musk kind of having a monopoly, right because
Speaker 2: he has a lot of satellites, but he doesn't have
Speaker 2: a monopoly on Internet access because there are other ways
Speaker 2: to deliver the Internet. You can get your Internet via
Speaker 2: fiber rocket cable, You can get your Internet via cell
Speaker 2: phone tower. You could even conceivably get your Internet via
Speaker 2: some crazy laser.
Speaker 4: Things that you know. I don't know, David, make sure
Speaker 4: I don't totally understand.
Speaker 1: Now.
Speaker 2: The other thing is there are other Starlink competitors. There
Speaker 2: are a couple of companies that are sort of legacy
Speaker 2: satellite providers that use older technology but also provide satellite
Speaker 2: Internet service. There is also an EU company. Yeah you
Speaker 2: tellt Yeah, I think it's like Eutel Sat maybe really
Speaker 2: probably the most literal name.
Speaker 4: For a for a company in history.
Speaker 2: It is a EU based satellite provider and this company
Speaker 2: is getting a lot of buzz.
Speaker 1: Stock has been soaring.
Speaker 2: Yeah, it's it's been up like five times over the
Speaker 2: last month. Over the past month. There is there is
Speaker 2: thought that Europeans may, especially European governments, may prefer to
Speaker 2: do business with a European space company at a time when,
Speaker 2: of course Donald Trump is you know, taking this nationalistic
Speaker 2: pose and Elon Musk is so closely.
Speaker 4: Allied with him.
Speaker 2: So there are these other options, and I think seeing
Speaker 2: these other options materialize kind of hints at the ways
Speaker 2: that this bet that Elon Musk has made on Donald
Speaker 2: Trump could go bad. His businesses, while very strong, have vulnerabilities.
Speaker 1: So, Dana, we've obviously seen it again and again and
Speaker 1: again in enormous numbers when it comes to Tesla, that
Speaker 1: old customer base walking away from the company, and we're
Speaker 1: going to talk about that at length again in the
Speaker 1: back half of the show. Maybe some signs that a
Speaker 1: little bit of that now happening potentially in the starlink space.
Speaker 1: The Guardian, I should point out, had a piece that
Speaker 1: came out yesterday or today citing some people who said
Speaker 1: I've given up my Starlink. I would have just myself
Speaker 1: slapped the bumper sticker on my Starlink and kept and
Speaker 1: kept using it. But maybe some signs emerging there.
Speaker 3: Sure, I mean, you know, I think what's funny is
Speaker 3: that for so long, I mean in the early days,
Speaker 3: like Tesla was the scrappy upstart taking on legacy Atto,
Speaker 3: and you know, Starlink was the scrappy telecom company taking
Speaker 3: on the big incumbents. And now that Elon is who
Speaker 3: he is, doing what he's doing with the Trump administration,
Speaker 3: the only way that consumers feel like they have political
Speaker 3: agency to kind of fight back is to you know,
Speaker 3: slap a bumper sticker or give up their product. I
Speaker 3: mean that said, most people buy products because they like
Speaker 3: the products, Like, yeah, you know, equally, there are a
Speaker 3: lot of people that are probably upset with Jeff Bezos.
Speaker 3: I'm not seeing people like vandalizing Whole Foods or canceling
Speaker 3: Amazon in the big numbers that they're you know, virtue
Speaker 3: signaling about their Tesla's.
Speaker 1: I just don't think right the rejection is quite is
Speaker 1: quite a strong, but that is a good The virtue
Speaker 1: signaling term max is important because Guardian article like actually
Speaker 1: came out I misspoke, it came out on Sunday.
Speaker 2: The lead image is like a Scottish folks. It's not
Speaker 2: exactly like he's barefoot on the beach. There must be
Speaker 2: like three or four other people like.
Speaker 4: This is not necessarily a huge court.
Speaker 2: I do want to say, though, there are other customers
Speaker 2: that are rethinking Starlink.
Speaker 4: You know, we're seeing reports out of Italy.
Speaker 2: Remember we talked some weeks ago about the deal that
Speaker 2: Starlink was in talks with Georgia Maloney and the Italian
Speaker 2: government to provide. So there's now increasing opposition in Italy
Speaker 2: over this deal. It is not a done deal and
Speaker 2: so and we're seeing you know, the opposition parties in
Speaker 2: Italy saying, hey, we should do this with a European player,
Speaker 2: not with space A. You tell set, well, yeah, assumably
Speaker 2: it isn't just virtue signaling, right like there are strategic
Speaker 2: reasons why countries might not want to know it has
Speaker 2: it can't.
Speaker 1: It certainly can't be virtue signaling in the same way
Speaker 1: it is with the Tesla, because who the hell knows
Speaker 1: what your internet is?
Speaker 5: Is?
Speaker 1: You know how you're and so it's truly you must
Speaker 1: really when you get rid of it, you must truly
Speaker 1: be concerned about your association with the company. If you're
Speaker 1: Italy or as a customer, you'd be like you must
Speaker 1: be just like I can't signal to my neighbors and
Speaker 1: my friends and he you know, I can't send them
Speaker 1: a message. But man, for me as a consumer, I
Speaker 1: just really don't want to give him any money. That's
Speaker 1: what it has to be. And we'll just see ultimately
Speaker 1: how beyond that, Scotsman, how big that universe is. And
Speaker 1: then over the weekend, Dana, we had an ex from
Speaker 1: Elon claiming that the first SpaceX mission to Mars is
Speaker 1: going to happen next year.
Speaker 3: What say you, Well, he's been saying that for a
Speaker 3: long time, so that's not really new. What was new
Speaker 3: was that that Optimists would be on board, right, So
Speaker 3: the idea is that the Optimist is going to Mars
Speaker 3: before the humans.
Speaker 4: You don't need a life support system, right, true.
Speaker 3: So it just sort of shows once again how like
Speaker 3: all of his products and all everything that he's doing,
Speaker 3: it's all in the service of Mars, right Like the
Speaker 3: boring company tunnels are all about Mars. Optimist is gonna
Speaker 3: work on Mars, and he's excited about it because you know,
Speaker 3: he's now got this relationship with Trump, Trump wants to
Speaker 3: go to Mars by the end of his first term.
Speaker 3: I mean, this is the whole enchilada. It's all about Mars.
Speaker 2: I think there's a second reason why he's talking about
Speaker 2: I mean, I take Danna's point that, you know, freelon
Speaker 2: Mars is the whole enchilada. But also, and we'll get
Speaker 2: to this in the next segment, Tesla stock is collapsing
Speaker 2: right now. Optimist is a Tesla product. He has used
Speaker 2: SpaceX in the past to provide marketing Tesla. That's what
Speaker 2: that's in part what this is. Right Saying he's gonna
Speaker 2: send Optimists to Mars is a way to potentially remind
Speaker 2: Tesla investors like I've got this really awesome robot called Optimists,
Speaker 2: and you know it's gonna be worth thirty trillion dollars
Speaker 2: or whatever. The other thing I want to say, there
Speaker 2: is no Mars program. Not only does does starship does
Speaker 2: it not appear to be technically ready or anywhere near
Speaker 2: ready to do the things that Elon is saying.
Speaker 4: NASA hasn't agreed to that. The thing that starts.
Speaker 1: But being under Trump, if Musk really wants to go
Speaker 1: to Mars asap is NASA. I'm not going to say yes.
Speaker 2: I think we assume that Donald Trump will be in
Speaker 2: favor of that. I don't think we know how the
Speaker 2: politics of that are going to work. There are other
Speaker 2: constituents here, there are other defense contractors, there are voters
Speaker 2: in the states where those defense contractors operate, on many
Speaker 2: which are red states. There's going to be a lot
Speaker 2: of political opposition to like taking money away from one
Speaker 2: NASA program and putting in another. And there would also
Speaker 2: be a lot of opposition to just like taking money
Speaker 2: away from what like Social Security employees or something. I mean,
Speaker 2: I'm not saying cut, I'm gonna say from not saying recipients.
Speaker 2: I'm saying they are cutting a huge, huge numbers of
Speaker 2: staff from the Social Security Administration and many other administrations.
Speaker 2: And one of the things that Elon Musk has said
Speaker 2: he thinks that we should do with that money is
Speaker 2: put into a MARS program. So, like, I don't know
Speaker 2: why that's far fetched. That is that is kind of like.
Speaker 1: What he said he in that case, and that is
Speaker 1: a political a tough sell politically.
Speaker 4: I'll say.
Speaker 2: Now, the other thing is they would need to make
Speaker 2: this starship do a lot more things than it has
Speaker 2: already done. I mean, when Elon Musk went on the
Speaker 2: Rogan podcast, there was a lengthy discussion about the heat
Speaker 2: shield on the Starship spacecraft, and it is not working yet.
Speaker 2: It is a novel design that they have not figured out.
Speaker 2: And that is among several problems that are sort of novel,
Speaker 2: including attempting to refuel this thing in space. There's a
Speaker 2: lot of questions about how many launches it'll take.
Speaker 1: Will there will be some sort of refueling vessel waiting
Speaker 1: for it up in space something.
Speaker 4: That is the plan. So so he's going to launch
Speaker 4: the just to get to the Moon.
Speaker 2: The plan is he's going to launch Starship, and then
Speaker 2: there are going to be a succession of many fuel launch.
Speaker 1: Like water stations in a marathon, like.
Speaker 4: Water stations in America.
Speaker 1: You know how tricky that can be. Grab the water
Speaker 1: to watch.
Speaker 2: Sometimes it gets dropped on you. But and in space
Speaker 2: sometimes the fuel just gets boiled off and disappears. So
Speaker 2: there are lots of issues. Again, it's not not to
Speaker 2: say that these issues are going to be impossible. It's
Speaker 2: just like acting like this is a done deal either
Speaker 2: technically or politically, is you know, bordering on delusional.
Speaker 1: Okay, let's move on to Tesla. Okay. We're now joined
Speaker 1: by Amanda mal a writer for Business Week. Amanda, thanks
Speaker 1: for joining us, Thanks for having me, Amanda. You just
Speaker 1: published today a terrific piece about Tesla and the brand
Speaker 1: destruction that Elon has wrought there, and there was a
Speaker 1: line that really jumped out at me and I wanted
Speaker 1: to ask you about it. You wrote that it's nearly
Speaker 1: impossible to think of a comparable example of a company
Speaker 1: detonating its own brand. Tell us about that. We've debated
Speaker 1: this a little bit on the show before, and we
Speaker 1: were wondering what kind of historical comparisons there were, and
Speaker 1: you found none.
Speaker 5: Yeah, Like, I've written about consumerism and branding and marketing
Speaker 5: for a long time, and what Tesla is doing with
Speaker 5: its customer base and its market positioning and it's branding
Speaker 5: right now is something that you know, I sort of
Speaker 5: stumped me for an analog in the history of consumption,
Speaker 5: because you know, brands pivot all the time. They seek
Speaker 5: to change their markets, they seek to expand their markets,
Speaker 5: they seek to find new kinds of customers. They do
Speaker 5: that in all sorts of ways, but very, very rarely
Speaker 5: is that done through telling almost their entire existing customer
Speaker 5: base that like not own yes to essentially go, you know,
Speaker 5: f themselves. And that is quite literally what Elon has
Speaker 5: done with the current Tesla customer base, which is overwhelmingly
Speaker 5: left of center people not necessarily libs or progressives, but
Speaker 5: like people who are concerned about the environment and willing
Speaker 5: to change their habits and make a very large purchase
Speaker 5: to sort of like put their money where their mouth.
Speaker 1: And was he fully aware do you believe at just
Speaker 1: how much he was going to turn them away when
Speaker 1: he made this pivot, or was is he surprised at all?
Speaker 5: I think Elon currently seems concerned about this pivot and
Speaker 5: what it's doing to Tesla sales, what it's doing to
Speaker 5: Tesla's share price. I think you can see that in
Speaker 5: the sort of car show that they put on at
Speaker 5: the White House last week. I don't know what he expected, Like,
Speaker 5: it's very hard for me to put myself in his
Speaker 5: sort of mindset going into this, because I think any
Speaker 5: anybody who works in branding or marketing would tell you
Speaker 5: that this is like what would happen when you changed
Speaker 5: the identity of the company from something that sort of
Speaker 5: flatters the sensibilities of progressives and people who are interested
Speaker 5: in the environment and in staving off climate change to
Speaker 5: something that is, you know, supportive of climate change, supportive
Speaker 5: of antagonizing that customer base.
Speaker 1: On that antagonizing point, there was a moment on the
Speaker 1: Stephen Colbert Show last week that kind have captured this
Speaker 1: a bit. Let us understand that in general, the Colbert
Speaker 1: Live audience is a progressive, wealthy, uh East Coast crowd,
Speaker 1: give or take. I'm sure there's some tourists in all tourists,
Speaker 1: but are they not.
Speaker 2: It's probably left of center, given that Colbert's left of center,
Speaker 2: But my guess is it's like more centrist than than
Speaker 2: like the regular cross section of New York.
Speaker 1: All right, well, let's let's listen to that clip. Well,
Speaker 1: there was a silver lining on the implosion of the
Speaker 1: world economy. It's bad for Elon Musk too. Yesterday, Well.
Speaker 4: That is not great for sales.
Speaker 1: Wow wow, Now, Max, What struck me having watched it
Speaker 1: last week was uh, just how raw it sort of
Speaker 1: felt from the crowd and how much Colbert and and
Speaker 1: the with him, we're sort of shocked by the extent
Speaker 1: of the reaction. And yeah, it's it's a thing.
Speaker 2: Yeah, I mean, I think they're two misunderstandings, and Amanda
Speaker 2: has kind of hinted at both of them. One is
Speaker 2: the sort of misunderstanding of his own customer base and
Speaker 2: like what they were excited about, what their politics look like,
Speaker 2: and how they felt about Donald trumpor would feel about
Speaker 2: Donald Trump. And the second, frankly, is a misunderstanding of
Speaker 2: Donald Trump's voters and how enthusiastic they are to buy
Speaker 2: electric vehicles or to you know, participate in the fandom
Speaker 2: of somebody that does what looks like to most saying
Speaker 2: people a Nazi salute, right Like, most people, including most Republicans,
Speaker 2: do not like that stuff. They don't like the like
Speaker 2: trolling version of Elon Musk. And you see that in
Speaker 2: the poll numbers. Musk's poll numbers are worse than Donald
Speaker 2: Trump's pull numbers, which is pretty amazing, honestly, considering that
Speaker 2: Musk was a very popular figure just a couple of
Speaker 2: years ago, beloved essentially and admired by people of both parties,
Speaker 2: and he has managed to just like blow past even
Speaker 2: one of the most divisive people, you know, public figures,
Speaker 2: you know, in the world.
Speaker 1: Yeah, am I talking with some of my friends who
Speaker 1: are members of MAGA, and I've raised with them and
Speaker 1: I've said, what do you think about this, you know,
Speaker 1: buying a Tesla, And I think that the sentiment has
Speaker 1: been no chance in hell has essentially been what I've
Speaker 1: heard back now, Amanda on that White House lawn sales
Speaker 1: pitch that we saw last week Musk and Trump and
Speaker 1: there's this whole fleet of Tesla's, of all colors and
Speaker 1: shapes and sizes. You wrote in the piece that to
Speaker 1: you it reeks of desperation. Is that what this is
Speaker 1: here and that it is not going to be an
Speaker 1: elixir of sorts for the brand.
Speaker 5: Yes, I think that when you see a stunt like that,
Speaker 5: My reading of it was that Elon understands that, like
Speaker 5: his his traditional consumer is not interested in associating with
Speaker 5: what he's now associated the brand with and what these
Speaker 5: protests have very effectively further associated the brand with, and
Speaker 5: he understands it seems that he needs to find some
Speaker 5: sort of other like Polish for this situation, and so
Speaker 5: he went to Donald Trump, which who was divisive but
Speaker 5: extremely popular among a large swamp of the population, and
Speaker 5: it was essentially trying to more explicitly hook Tesla up
Speaker 5: to not just his own cult of personality, but to
Speaker 5: Donald Trump's. And I think that it probably worked for
Speaker 5: like some small number of people who were really, really
Speaker 5: in tune to, you know, signals coming from Trump himself.
Speaker 5: But like most of Trump's voter are not fully bought
Speaker 5: in ideologues to the weirdest parts of internet right wing thought.
Speaker 5: They are regular people who, like Max SAIDs don't necessarily
Speaker 5: want to be associated with a lot of the things
Speaker 5: that Elon Musk explicitly associates himself with. Like people who
Speaker 5: want to own the Libs through their car purchases have
Speaker 5: like a wealth of options. They have all kinds of
Speaker 5: trucks and SUVs.
Speaker 1: And buying a Model three is not that is not
Speaker 1: how you achieve it.
Speaker 2: I remember that ad that which we talked about. I
Speaker 2: showed this demanda before we started taping. But Dan, I'll remember,
Speaker 2: well America Pack ran these ads that were like, the
Speaker 2: Libs don't want you to buys to like take zin
Speaker 2: or eat red meat or buy a truck.
Speaker 4: And you see a picture of a truck, it's not
Speaker 4: a cyber truck. It's a gag.
Speaker 2: Well, we Man and I were trying to figure out
Speaker 2: what it was, but we couldn't figure out. It may
Speaker 2: have been a rock generated truck, but in any case,
Speaker 2: it was definitively not a cyber truck like you can
Speaker 2: buy as a man of center piece.
Speaker 4: You can buy like a V eight, you know, or whatever.
Speaker 2: You can buy a F two fifty and on the
Speaker 2: libs that way fifty big you can if you really
Speaker 2: want to commit. But but in any case, like there's
Speaker 2: just you know, it's it's just not clear that like
Speaker 2: the pitch of Sustainable Transport has found purchase with that.
Speaker 5: He's in a really he's in a really crowded market
Speaker 5: for symbols of owning the libs via you know, vehicular manner.
Speaker 1: Okay, but but he does he is quite good at
Speaker 1: owning the libs, though in general perhaps not via via
Speaker 1: vehicle uh sales. Now, Dan, I want to raise this
Speaker 1: with you though, because there was a Washington Post story
Speaker 1: that came out in the last couple of days that
Speaker 1: says that Google search increases or Internet search increases in
Speaker 1: Red America for quote by a Tesla are way up.
Speaker 1: And then they cite a bunch of politicians and sorts
Speaker 1: no buyers to be They don't cite a single buyer,
Speaker 1: but they have a bunch of politicians sort of really
Speaker 1: pushing in the wake of the White House lawn ship
Speaker 1: the Tesla brand. We are from where you sit your
Speaker 1: dubious this is going to go anywhere. I mean, there
Speaker 1: are showrooms, by the way, I looked up in red America.
Speaker 1: There are showrooms in Meridian, Idaho, and Council Bluffs, Iowa,
Speaker 1: and Strongsville, Ohio, and Chattanooga, Tennessee. They're not rushing to
Speaker 1: those dealerships to buy musks.
Speaker 3: Shift to the right and the effort to kind of
Speaker 3: pitch Tesla as a car to middle America began quite
Speaker 3: a while ago when the company moved its headquarters from
Speaker 3: California to Texas. And you know, if you look at Tesla,
Speaker 3: like the mission of the company is about accelerating clean energy,
Speaker 3: but they really market the car as just being like
Speaker 3: a cool tech car. Right. So they've been aware that
Speaker 3: there has always been a ceiling to the number of
Speaker 3: liberal clostal consumers who were going to buy a Tesla.
Speaker 3: They knew that they had to kind of reach out
Speaker 3: to red state America a long time ago, which is
Speaker 3: part of why they moved to Texas, which is part
Speaker 3: of why they came out with the cyber truck. But
Speaker 3: that said, the infrastructure for EVS in Middle America is
Speaker 3: still not as strong, and like the state incentives are
Speaker 3: not as strong as they are in places like California
Speaker 3: and Colorado. That said, like Texas is a big state
Speaker 3: for EVS, and there are a lot of people who
Speaker 3: drive Tesla's in Texas. It's all Texas and Florida. So like,
Speaker 3: I think people have the wrong impression that you know,
Speaker 3: EV penetration is you know, blue state only. It's actually
Speaker 3: the penetration is warm state. Texas and Florida are huge
Speaker 3: EV states. So this shift has been going on for
Speaker 3: quite some time and predates Trump selection.
Speaker 2: You know that that made for TV infomercial thing and
Speaker 2: talking about the white on the White House lawn. You know,
Speaker 2: I think if you watched it, it wasn't a great
Speaker 2: ad for Tesla. It was a great piece of content
Speaker 2: for Donald Trump because well it was. It was really
Speaker 2: entertaining and really fun. It had this moment where Trump
Speaker 2: got in the model atque computer Everything's computer. Yeah, it's
Speaker 2: all computer.
Speaker 3: This is a different panel that I've had.
Speaker 5: Everything's computer, that's.
Speaker 2: Beautiful and and like that was a viral moment, and
Speaker 2: and it just really had the contours of like of
Speaker 2: a reality show, like an episode of The Apprentice that' said,
Speaker 2: the actual like sales pitch was kind of buried in
Speaker 2: a middle like a press conference, a bunch of Trump's antics.
Speaker 2: And then the whole point of this thing was that
Speaker 2: Trump was gonna buy a car, which he barely did
Speaker 2: in the thing. You watch the thing right that Trump
Speaker 2: gets in the car, he takes a bunch of questions.
Speaker 2: Half an hour goes by, then he starts saying his goodbyes.
Speaker 2: He says, oh, thank you, Elon, thank you. Every Then
Speaker 2: the reporters are like, mister President, what car are you
Speaker 2: gonna buy? And he just like flips around and kind
Speaker 2: of casually goes like, oh, that one. And it doesn't
Speaker 2: look like a considered purchase, doesn't look like something he's
Speaker 2: truly excited about. And I think this gets to a
Speaker 2: more profound problem with Elon Musk, which is that he
Speaker 2: is now in a sort of relationship, a business relationship
Speaker 2: with Donald Trump, who is not somebody who is really
Speaker 2: all about kind of win win partner ships. And I
Speaker 2: think it's pretty clear that Donald Trump is doing very
Speaker 2: well in this partnership.
Speaker 3: You know.
Speaker 2: After this event, the New York Times reported that Elon
Speaker 2: Musk had agreed to give another one hundred million dollars
Speaker 2: to donate another one hundred million dollars to Donald Trump's Superpack.
Speaker 2: Not his own superpack, because Muscle is putting money into
Speaker 2: that for the Wisconsin State Supreme Court, but an additional
Speaker 2: one hundred million bucks for Trump to spend as he pleases.
Speaker 2: Trump is doing really well here. And again I don't
Speaker 2: know that Elon Musk got his hundred million dollars worth
Speaker 2: in that event.
Speaker 3: Well, the other thing that was significant about that event
Speaker 3: was that Trump agreed that people who are vandalizing teslas
Speaker 3: should be treated as domestic terrorists. And that is like
Speaker 3: a huge escalation and something that everyone really needs to
Speaker 3: pay attention to. So you're now going to see, you know,
Speaker 3: as people get arrested for vandalizing stores, or keying cars
Speaker 3: or setting superchargers on fire, like much more aggressive prosecution.
Speaker 2: I thought, owners of t still, we're going to be
Speaker 2: protected by hate crime laws. It's it's terrorism that we're going.
Speaker 4: What what what?
Speaker 1: What made me laugh a little bit was the quote
Speaker 1: from the Attorney General Pam Bondi the other day where
Speaker 1: she said, if you're going to touch a Tesla, go
Speaker 1: to a dealership, do anything, you better watch out. And
Speaker 1: I'm thinking, like that's the problem. No one's going and
Speaker 1: touching Tesla's and going to dealerships. You need people to
Speaker 1: go there. So it's like, of all the worries we have,
Speaker 1: that shouldn't be one.
Speaker 2: I mean, obviously there are, like you, questions about norms
Speaker 2: and kind of like potential executive overreach here, but like
Speaker 2: this just calls more attention to the protests than otherwise
Speaker 2: than I think there like you're just saying yeah. I mean, like,
Speaker 2: I don't think this really helps e on Musk in
Speaker 2: any way. It just it just calls attention to fact
Speaker 2: that like if you shoul drive a Tesla, people are
Speaker 2: are going to just be boiling mad all around you.
Speaker 1: I mean, well, Dan, I want to point out that
Speaker 1: stock opened up. Tesla did down again this morning, testing
Speaker 1: once again those lows that had hit last week. I
Speaker 1: think it's been down around fifty percent or so from
Speaker 1: the peak, the immediate post election peak, and it's down
Speaker 1: in part because of this big BYD news overnight out
Speaker 1: of China. BYD's now got this whole new car and
Speaker 1: this new battery that you can recharge almost as quickly
Speaker 1: as you would put fuel in a combustion car, just
Speaker 1: five minutes. And it just strikes me. And I think
Speaker 1: it's striking investors out there that BYD is just bringing
Speaker 1: it and innovating day in and day out, while Tesla
Speaker 1: sort of snoozes.
Speaker 3: Yeah, and you're also finally seeing like the sell side
Speaker 3: analysts wake up and cut their estimates, so that's also
Speaker 3: impacting the stock. But yeah, no, I mean, like Tesla
Speaker 3: has real competition in China, which is where it gets
Speaker 3: like forty percent of its sales, and BYD and you know,
Speaker 3: like for so long the supercharging network has been Tesla's
Speaker 3: big value add but now like the next sleep is
Speaker 3: like even faster, and there is this sense that like
Speaker 3: the valuation is coming back to earth. The backlash against
Speaker 3: the brand is real. As Amanda wrote so beautifully in
Speaker 3: her piece, analysts are waking up. Q one is going
Speaker 3: to be a mess. You know, everyone's cutting their price
Speaker 3: targets and their estimates, and you know, I think the
Speaker 3: proxy will be worth reading too.
Speaker 1: Okay, Now, Amanda, as Dana just summarized so well, it
Speaker 1: is a pretty gloomy outlook out there, and for him
Speaker 1: and for Musk in this moment, and for Tesla. You
Speaker 1: wrote in the piece as well that Musk appears to
Speaker 1: have completely misapprehended the symbolic value of Tesla's brand, or
Speaker 1: at the very least, he seems to have misunderstood his
Speaker 1: own capacity to change the nature of that value without
Speaker 1: also diminishing it. So I ask you this the same
Speaker 1: question I asked Dana last week. If Musk had to
Speaker 1: do it all over again and he could know then
Speaker 1: what he knows now, is he still a yes to
Speaker 1: this whole thing?
Speaker 5: I think he probably is, because I think he is
Speaker 5: like a true believer in a diologue, in the stuff
Speaker 5: that he is doing politically right.
Speaker 1: The government needs to be rained in and government spending
Speaker 1: needs to be reined in.
Speaker 5: Yes, I think that his larger project is this.
Speaker 1: Doge stuff drive Tesla is zero.
Speaker 5: Yes, absolutely. I think that I think that he feel
Speaker 5: he is sure enough in himself that he can find
Speaker 5: some sort of financial upside, maybe not for Tesla, but
Speaker 5: maybe but elsewhere that he will be fine.
Speaker 1: So his break he essentially from the Tesla's stock price,
Speaker 1: there is no breaking point in the Tesla stock price
Speaker 1: for him. Maxis, do you have a Tesla stock price
Speaker 1: where Musk capitulates and breaks?
Speaker 4: And I think so.
Speaker 2: I think that Elon Musk, I think he and Donald
Speaker 2: Trump will last through the midterm. But I think the
Speaker 2: only thing that could stop that, but the thing that
Speaker 2: could lead Musk to leave, or could lead that relationship
Speaker 2: to break up, is not about Donald Trump getting sick
Speaker 2: of kind of like Elon Musk hang around or whatever
Speaker 2: other kind of hilarity ensues over in the executive branch.
Speaker 2: It is the stock price of Tesla. It's like, if
Speaker 2: it fell, it's falling about fifty percent. If it fell
Speaker 2: another fifty fifty percent from where it is today, which
Speaker 2: totally could happen. You look at the share price of Bid.
Speaker 2: You're talking about how great Bid is doing. It is
Speaker 2: worth a lot less than Tesla.
Speaker 4: I looked.
Speaker 2: I think it's you know, between one hundred and two
Speaker 2: hundred billion. Tesla right now worth seven hundred billion. So
Speaker 2: if that stock price were to fall further, if it
Speaker 2: were to fall too closer to the valuation of SpaceX,
Speaker 2: for instance, you know, round, that would make my exactlytion
Speaker 2: below for one hundred billion. I could see Musk opting
Speaker 2: to spend more time with his company, Like he could
Speaker 2: basically maintain his alliance with Trump and go back to
Speaker 2: Tesla and like solve potentially two problems at the same time.
Speaker 2: Like at some point there are going to be diminishing returns.
Speaker 2: Those are going to start to face diminishing returns where
Speaker 2: like it gets harder to cut costs the political backlash growth,
Speaker 2: and also like there's no reason he couldn't say, thank you,
Speaker 2: mister president, You're doing a great job, but I need
Speaker 2: to focus on my company. And he could still write
Speaker 2: Trump hundreds of billions of dollars worth of checks.
Speaker 1: Absolutely, And aren't you, by the way, already starting to
Speaker 1: get diminishing returns from dos? I mean, certainly, as we
Speaker 1: said at the very top of the show, they're in
Speaker 1: the news a lot less than they used to be. Now.
Speaker 1: Maybe that's just because Wow, they're just doing their business
Speaker 1: now and the shock and all of the initial days
Speaker 1: is pasted. Don't read too much into that or read
Speaker 1: a lot into it. They're just not getting a whole
Speaker 1: lot done at this point.
Speaker 2: I don't think we really know like in terms of
Speaker 2: their you know, cut attempts to cut government spending, whether
Speaker 2: they've hit diminishing returns. I think politically they are hitting
Speaker 2: diminishing returns. You know, the reports out recently about getting
Speaker 2: rid of phone support for social Security, Like, you're starting
Speaker 2: to cut into things that are.
Speaker 4: Going to be popular with voters.
Speaker 2: People people who need to access social Security benefits do
Speaker 2: not you know, they happen to be most of them
Speaker 2: happen to be very old, and they're not necessarily the
Speaker 2: kind of person who's like super enthusiastic about talking to
Speaker 2: a chatbot. I am not enthusiastic about talking to a chatbot.
Speaker 2: And you know, and I'm forty two, so like I
Speaker 2: can only imagine somebody who has less experienced how they
Speaker 2: feel about it.
Speaker 5: Yeah, and this goes back to what you were talking
Speaker 5: about earlier. I think about the sort of Trump is
Speaker 5: not like a win winess business partnership guy. So he
Speaker 5: Trump has effectively gotten Elon Musk to be the face
Speaker 5: of a lot of the things that are going to.
Speaker 4: Be unpopular.
Speaker 1: That he if he were the guy with the cudgel
Speaker 1: in his hand, he Trump, he would be taking all
Speaker 1: that heat instead. No, Elon, you got this, dude, go
Speaker 1: for it.
Speaker 4: Yeah.
Speaker 5: I think that Trump has effectively structured this whole endeavor
Speaker 5: so that Elon Musk is the face of the stuff
Speaker 5: that is less likely to be.
Speaker 1: Popular as a results of eventually the fall guy, and
Speaker 1: not only yeah, absolutely yeah, Trump can eventually ran him
Speaker 1: and say oh no, no, no, no, we don't want to
Speaker 1: go that far.
Speaker 5: Yeah, never mind, you know, we were, We're looking at
Speaker 5: it very strongly.
Speaker 1: What did Amanda? Thank you very much for joining us.
Speaker 1: That was a terrific piece you had out today. Tesla's
Speaker 1: gamble on Maga customers won't work. And when you have
Speaker 1: a news story out on mister Mosk or Tesla or
Speaker 1: any of his other companies, you shall come back and
Speaker 1: tell us all about it.
Speaker 5: Thank you so much, all.
Speaker 1: Right, Max, Dana thanks as always, Thank you for having us.
Speaker 4: David, thank you.
Speaker 1: This episode was produced by Stacy wang Anna Masa rakus
Speaker 1: Is our editor, and Rayhan Harmanci our senior editor, Blake
Speaker 1: Maple's handles engineering, and Dave Purcell fact checks. Our supervising
Speaker 1: producer is Magnus Hendrickson. The Elining theme is written and
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Speaker 1: is our executive producer, and Sage Bowman is the head
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