Value Investing, Videos

Elon Musk interview with billionaire investment legend Ron Baron (11.6.15)


Published on Nov 8, 2015
Elon Musk sits with Ron Baron from Baron Capital Management at the Baron Investment Conference.

Overview:
00:00. Introduction
03:50. Early days, motivation & oil industry FUD campaign
11:25. Birth and rise of Tesla
16:20. Huge Tesla factory
19:25. Tesla ambition – millions of cars
20:33. Gigafactory Government fundings
24:19. Gigafactory media incident
25:22. Battery technology outlook & costs
33:00. Tesla safety
40:13. SpaceX reusable rockets
44:15. Lyft vs. Uber
Q&A
46:20. Model 3 driving experience
48:50. Charging locations

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0:00good morning
0:03my name is glad honey and I’m a research analyst at their in capital following to
0:11take an energy infrastructure sectors it is my distinct pleasure to introduce our
0:17next guest he’s a man who has been identified as everything from a
0:22supervillain to a superhero he doesn’t stop at changing our world as we know it
0:29he’s on a mission to change our galaxy Elon Musk
0:46company whose mission is to accelerate their worlds transition to sustainable
0:53transport in 2004 elam was a leading investor in Tesla’s first announced the
1:00ground and in 2008 when the company was near bankruptcy Elan became CEO in led
1:09its growth over five billion dollars of revenue today
1:18the company develop electric vehicles the roadster model S model ex the Model
1:28S has been described as a remarkable car that pays a new unorthodox course and
1:35it’s a powerful statement of American start-up ingenuity Model X which was
1:42recently launched has away time of over a year
1:48Tesla sold almost 200,000 vehicles electric vehicles to date
1:53test leads building a battery manufacturing plant codigo factory that
1:58will be ten times bigger than the largest Boeing facility producing
2:02Dreamliners interestingly Tesla is the largest battery consumer in the world
2:09surpassing consumer electronics companies like Samson and Apple you line
2:15is a scientist and inventor and designer and one of the world’s most innovative
2:22minds he’s helping to advance some of the world’s most disruptive technologies
2:27Tesla in the auto industry SpaceX in the aerospace industry and SolarCity in the
2:34power industry now please welcome elan and run for a conversation
2:46so when I started my career when I my first client told me that what was most
2:52important was finding someone who could realize degree make it happen and that’s
3:00been my whole career finding people in which to invest in whom to invest I was
3:04with Eric Schmidt recently he’s a chairman of Google and he’s one of his
3:09best friends and he was telling me that he regards Eli as a combination of water
3:15crisis there and Thomas Edison and I didn’t really know very much what walter
3:20Chrysler until I looked him up on google and and pretty dress you be compared to
3:25those two guys so so so again keeping with the hearing about investing in
3:31people so we’re investing in you and and and I think we’re talking about five
3:37billion dollars in revenues sure you believe this is just a very beginning so
3:42so I think it’s such a little bit before we get into the business on your
3:46background we started talking about that before so he came from South Africa your
3:51dad was an engineer and your mother my mother’s model and educationist and one
3:59of your brothers work with you to the first come together and so have you know
4:05I know I was also a founder of these games and the kind of games and then he
4:11was a founder of PayPal so the PayPal PayPal that’s old when public seven
4:17eight hundred million dollars though there Friday into eBay but ultimately
4:21fifty billion that presumably that has some impact on the way you think about
4:26things
4:28actually I actually was against the sale I wasn’t the sale but I was always
4:38largest you know the time but only have like 12 percent as everybody else really
4:44wanted to sell so we went for doing that but I think I think we probably
4:49shouldn’t yeah
4:53so so he’s reading about your history and and we spoken before obviously and
5:01about your interest in space and sustainable transport and solar energy
5:06goes come from
5:08well when I was in college I thought about what would most affect the future
5:16of humanity and I want to be involved in those the some of those areas and I
5:23thought there P
5:24things today that I came up with that would really affect our future as a
5:30civilization one of them was the internet and the other was sustainable
5:38energy consumption of that and the third was making life multi planetary and
5:47therefore were genetics and an ally and I don’t think I’ve been involved in
5:57those areas but I just those who are in the abstract of what I thought it would
6:01affect things and going back a little further I actually didn’t really expect
6:09to be involved in creating companies when I was in high school or middle
6:15school I actually was sort of physics and nuclear physics
6:23understand more about the nature of the universe but then things like the
6:30superconducting supercollider got cancelled and I thought well you know
6:34like what if I’m stuck in a situation like that and then that’s like some
6:39active government basically stops things and then I would be a waste of their own
6:46when it when I think about the course and so obviously you know if you’re
6:52using hydrocarbons in burning
6:54and wrecking the environment makes it tough to the diner in few pointed out
6:59unless we adapt to start to read
7:02monoxide and so so so so that’s your effort there but yeah actually in
7:11college my interest in sustainable energy was really good at the time was
7:17was really from the standpoint of of essentially running out of hydrocarbons
7:23to minor burn so there’s there’s a limited supply of oil in the ground and
7:29eventually would have to transition to something that sustainable because what
7:36we’re doing well for the ground were essentially
7:39accumulates solar energy that was bound up in plants and animals and that over
7:46hundreds of billions of years was turned into you
7:49oil and and and that’s that’s also a finite and if we run out of that and
7:57don’t have a good solution then they would be economic collapse into positive
8:02environmental concerns and is there was actually what sort of initiative by just
8:07isn’t sustainable energy and sort of logical if energy needs to be
8:13sustainable if it’s going to last for long term and then over time it became
8:18apparent that there was there was actually even more pressing concern
8:22which is that we’re quite materially changing the chemical constituents of
8:26the oceans and atmosphere and the way that humanity has grown up around the
8:32world is that with so much to me about cities settlements of pounds right along
8:39the coastline and the world is quite sort of delicate
8:46industry chemical balance and so that if we do take
8:52billions of tons of co2 that was buried deep underground and has been since in
8:58most cases the Precambrian hero when the most sophisticated thing was like a
9:03sponge and that would be it would be about experiments run so so it seems so
9:09obvious and we have all these power companies to make all these cars every
9:13year to burn gasoline and nobody wanted to do it white light weight to it so
9:20obviously read evidence in exon was in the paper about the impact they have on
9:26the environment and they hit it just like the cigarette companies in 1866
9:33same playbook the crazy thing is I’d recommend reading the book merchants of
9:38doubt cause the actual explored sometimes I just such a few hours and
9:44elsewhere
9:45sort of explored like what’s going on here and actually found that the oil gas
9:53israel’s actually using literally the same obvious as the tobacco industry
9:57like buying me not even the phone may strike some as school for silicon yes I
10:05mean just like they learned how to do it
10:08yeah absolutely and then the one we always involved with making was recalled
10:14thank you for smoking which recommend watching a fun movie and as he put it it
10:23sort of space on Facebook and it’s it’s it’s really get to the truth of the
10:32matter of like how this happens and what they do is essentially exploit out and
10:38serve even when you’ve got a situation where virtually every scientist on a
10:43agrees that this is that that global warming is real that adding billions of
10:50tons of carbon to the atmosphere and nurses is a bad idea
10:54you have a few
10:55to send and then the way they describe it as presented to the public is is not
11:02bad either 97 or 98 percent of scientists think what we’re doing is
11:07crazy but that but something that scientists disagree not know the
11:12scientists disagree about everything you will not find one perhaps if scientists
11:18you agree about anything but this is a very disingenuous argument so so so I
11:25understand that and then I go to be your plan and been there every three or four
11:31months now and I guess not very many people who are endless and will stream
11:36the 22 guys publish about yesterday I think very few have actually been there
11:40for the N word spoken to you but then when I going to plan and its other
11:46automobile plants also needs a lot of people not that many machines I see a
11:50plane destined to see a lot of machines not that many people and I look at it
11:56and it appears to me so I how do you build such a thing how could you
12:01everything you gonna be successful
12:03like how to do such a thing and then to immigrant kids you come here you do I do
12:08that work should will beginning of tuzla I didn’t think we would be successful I
12:15thought we were almost certainly fail and you put all the money you hadn’t
12:20people to test in this and you thought you feel ya
12:29through the basic logic I mean how to come out of paper was fortunate to have
12:39about a hundred eighty million dollars and I thought well let’s put a lot of
12:44money you know if if I am going to assign half of this to SpaceX has loads
12:51for city and also have the other half and I’ll be fine and you told your wife
12:57if it doesn’t work with her parents basement I did I was yeah hopefully
13:03kidding it’s not it’s not great enterprise basement yeah yeah that’s you
13:15like that but things so I thought you know so I figure I probably lose the
13:23money but good try and it’s kind of important with doing but then as time
13:31went by and the company’s needed more money and then we hit that really tough
13:35recession of 2008 09 which was super bad for the quarter 3 p.m. at Christ the go
13:42bankrupt so I was like man if I don’t invest everything if if if I miss
13:50everything there’s a chance and that will suit me best everything there was
13:56no chance to win Super that recession is no way this could have existed we gonna
14:02buy billion dollar plan for fifty million dollars that’s true but they
14:04came here a bit later but yeah but the the real key thing was was 2008 will
14:10even from 2007 to 2009 but the two-year period was super bad and we’ve made so
14:20many mistakes the beginning of Tesla that we basically have to recapitalize
14:23the company was completely in 2007 almost every decision was wrong so when
14:32we created the company and I gotta give credit here for the beginning for AC
14:39Propulsion which is a little caught up in Southern California created an
14:44electric sports car and it was actually based on on on AC Propulsion sort of
14:51idea if I was trying to convince AC propulsion to commercialize electric
14:58sportscar commercialize the prototype of the done but they’ve had no interest in
15:02doing that and hopefully convince them said look I’m just happy with myself and
15:10then they said well you know this and other people also want to do it
15:14join in with them I said ok let’s assume that most guys don’t get enough credit
15:21that it’s a cool stuff with electric sports car before tests thats with
15:26that’s what you’re thinking about using engine and electric or should you use
15:31electric power level that was that was pure electric sports arena hopes as they
15:37quite complex and it’s like many soap opera episodes but you could be a part
15:41of it but another issue created a pure electric sports car for the T zero just
15:51a demo but they would just not interested in commercializing their
15:55stuff and said look a like this really needs to reassure people broadly what
16:01are sincere and caring people through phases but I do so you can see we go
16:10back to supplant master plan that we have that in Fremont California I never
16:15expected that we have this plan but it’s amazing place yeah
16:19and make me feel like it’s kind of cool which is better than we thought we would
16:25have got that plant that’s one of the biggest plants in the world I think it’s
16:31sort of like my footprint I mean I think it’s likely view the third or fourth
16:35biggest how many square feet by what happens with you
16:41yeah so that’s what hundreds how many acres under roof yeah the General Motors
16:53building just TV prospective General Motors building which is where the Apple
16:56stories that one block its 150 acres yeah it’s crazy you could go camping in
17:02there
17:05I get takes you a long time for provoking one side to the other bikes
17:12the factories just get around a bit faster and when we first got this which
17:19was actually it was a bit later as in early 2010 and we thought man is no way
17:27we’d ever get that but also plan because it costs too much and reno much money
17:35but then as a result of the recession the plant which was joined by Jim and a
17:42Toyota had to close down the street that is sort of a long story independent has
17:52left so they’re going out of town and I’m just gonna be empty and there was
17:55maybe gonna turn it into like a mall or something like that but it’s gonna be
18:01empty for a long time and we have approached Toyota said like look you
18:10know we’ll take it off your hands
18:15much was featured on the street where were actually apparently also electric
18:26rav4 program and they were also their investment at the IPO so they better
18:34stop here
18:35$40 and $50 at a $17 share price so it worked out for them but we were amazed
18:45that that they’re they’re willing to move forward and do it and but for us it
18:52was so tiny of the time and it was like magic mic you’re like this little band
18:56for slippery and it’s like somebody says well as the giants like alien
19:01dreadnought that you can have for pennies on the dollar and you have no
19:06idea how it works like where the controls how to use this thing and that
19:14that’s what we were up to 225 at a point where automotive plants were not with
19:22much to this plan ultimately is going to be able to do have a main course here I
19:27think I think half way of cars and we go beyond happily force them but that’s not
19:32really the dream I mean long-term I really want to try to do several million
19:38cars yeah I mean what we now define 50,000 this year and 75,000 next year we
19:45took the several million and we think about folks wagon 10 million to $10
19:53general motors eight or nine million profit margins a fraction of what we
19:58think we can do better than that
20:02well i mean i guess i mean i three possible 30 possibly other question I
20:10think over time if we continued to great products and we keep our cost structure
20:17competitive then I think he knows what the ultimate do you need a lot of these
20:23plans
20:24yes many plants many auto plants and many factories I think they did a
20:31factory this do that when you get factories in nevada 4 billion five and
20:37it’s expecting it to be roughly five billion dollar investment to get to full
20:43production of the test tells those providing a roughly fifty sixty percent
20:48of that over time and then strategic partners like Panasonic a number of
20:52others are providing the other house and then he gave us a billion in tax credits
20:57for savings or something the whole tax thing drives me crazy
21:05its quarterback yeah it sounds much better than it is actually the first
21:11time I heard that there was 1.3 billion was at the press conference announcing
21:16the deal like really how do we get to 1.3 what we actually got with the
21:24vibrate gave us some free land but the state of arousal and so this is not a
21:31not for Supply yeah there’s a lot of Nevada and then they also agreed to
21:40build a connecting highway on the southbound
21:45that connects to Carson City but they’re gonna be that anyway so I don’t think
21:48like that should be included out what they gave us and then they repurposed I
21:57think eighty million dollars of tax credits that was going to the insurance
22:03company insurance companies or something
22:05repurposed out to us but that’s the only sort of thing that we can actually
22:10monetize and then and then they also gave us relief on sales and use tax or
22:20equipment in the factory and depending on what type of situation see the ten or
22:26twenty years for the sales tax abatement so if you assume that we we fully use
22:33the sales and use tax abatement which requires building which was actually
22:37capital equipment in excess of five billion dollars over twenty years and
22:41you add all of that it has to 1.3 billion three in fact that the
22:49contribution in this 100% see the factory factory by student body is less
22:54than 5% and then there and then they have roughly 1 percent contribution of a
22:58twenty years so so presumably for them to you because he’s getting better jobs
23:04it’s a no-lose proposition for the states I mean as the saying goes the
23:10house always wins and like the vital understand the house ok
23:15nobody is the house
23:19it’s like the only way for us to actually have the sales tax credits
23:26meaningful is if pressed to have enormous numbers of machines and
23:31enormous numbers of people operating those machines and Mississippi Nevada
23:35Nevada speculation was that there but they were at their return on their tax
23:41credits would be somewhere between 80 and 100 percent times so it’s like a
23:50good feel for the state so so so that the battery plant that’s the plan kids
23:58is done without a lot of without any I understand public viewing of what we
24:08doin inside a factory and there were some reports so far and there’s been
24:15some reporters I guess a couple or three weeks ago that’s nothing to our property
24:19that like right over to about people trying to kill us guys yeah it was
24:25pretty crazy wife what it’s got a bit overzealous and then I seen that they
24:32panicked and actually trying to kill her employees but but they paid it run over
24:37to her place which is but you know what they’re trying to try to get away and so
24:43they’re out of its about guys like what they liked the danger zone too serious
24:47but but yeah that’s that’s like not cool
24:53so so so so we think it’s important enough to not let anyone see what we’re
24:59doing inside and other people trying to figure out what’s going on and obviously
25:05not a nightclub and so so what it is what I think that is not knowing much
25:13about technology how things work is that so we’re making that kind of a battery
25:17that although the general rubric of the game covers many types of chemistry’s I
25:26mean really broad range of things of batteries that use lithium as the ion
25:31transport so whatever you described herein is going to go over my head but
25:34my question is how do we know we’re making such investments that what we’re
25:40building in that factory is going to persist and why is it that in a hundred
25:45years so we do also two things you’re sending things out of the atmosphere at
25:49the Galaxy lol universe claims and yet four hundred years we haven’t been able
25:55to build a battery that goes from more than 300 miles helping how is it
26:01possible that we haven’t been able to spend money on that and if that’s the
26:04case because no one’s paid attention to it and all of a sudden we come along and
26:07potentially going to try to reduce the weight in the existing batteries and use
26:11maybe silicon and having a 300 mile battery 2002 how do we worry that what
26:16we’re building it can get obsolete also the reason is better at this point we
26:22have quite a good understanding of all the battery technologies in the world
26:27could be some small laboratory that things super secret but generally what
26:33people investing battery technologies try to do is they pushed as the first
26:38and foremost cause we’re the biggest lithium-ion consumer in the world to
26:42anyone who wants to build a battery has new ideas you can come to us before they
26:45going to be their biggest customer so if somebody event something the obvious
26:51choice to license the two or is is tuzla and so we try to take things seriously
26:58as possible but made which we track right now about sixty different efforts
27:04from the world development
27:06batteries and you know some of them hold some long-term promise but we rewrite
27:14all of them on from a 125 is we should be doing business with them and one is
27:23complete BS how many flights over 53 currently there’s no food no one in this
27:33one even in the four like this that might go from a 32 of 44 means we should
27:38we should be in like preliminary discussions so what’s what’s going to
27:42change the technology this could enable us to have these different we can have
27:46something ten years it’s gonna be unusual battery that’s gonna be able to
27:49do a thousand miles in a way that does presently I don’t think we’ll have quite
27:54pleased about much improvement and actually at the most likely would not
27:59like technically right now for us to do see a 500 mile range are we could have
28:06to do that right now with part part batteries but the declines to be too
28:12high and the useful load impact on the vehicle me too I’m so happy to have to
28:16pull up part of the trunk and the front and the front and rear of truck without
28:21trees would have to pitch to LeBron passenger room but I remarried car right
28:26now I remember each car in the current form factor I think that’s you know
28:36probably less than 10 years away within the same volume and roughly the same and
28:41then we would drive the cost the kilowatt hours to 1,500 that’s because
28:46we’re doing what
28:48that’s just because we’re doing scale because we’re using different materials
28:52because we’re changing chemistry how do we do that yes we are quite substantial
28:59improvements in the
29:01total pac energy density so this is the cell energy density and then as you
29:06those cells together in a pack you have to figure out how to do that safely we
29:13were able to reduce to pack energy does this will make i think quite significant
29:17profits indicating the package does that put the thing that’s most important
29:22really is the cost because a lot of people that driving but alas the one of
29:31the current say to avoid a Model S will do over 300 miles right now at
29:37sixty-five miles an hour so that’s that’s enough range for most people it’s
29:44and then you get the supercharger way to recharge very very quickly with
29:49supercharger work that’s now ubiquitous throughout the country
29:52let’s by customers to cross-country trips la you’re not using a support
30:00network so this really help you have freedom of travel this point and
30:04certainly provides the battery pack range are important but the thing that’s
30:09really important is reducing the cost per kilowatt hour so that we can do that
30:16with existing
30:17yes yes we are going to make some technology improvements as well to the
30:22fundamental cell chemistry and so they to the way that the battery modules and
30:28packs are organized but the fundamental focus is on cost per unit of energy and
30:37that that’s so that’s that’s what the big factories about it’s it’s it’s
30:43taking economies of scale as far as far as we can possibly imagine 22 very
30:49extreme level of sportsmanship and that’s what gets a two hundred and
30:52that’s what they said lower than 100 $100 until I
30:58we can’t comment on exact price numbers but I mean that’s not that that’s
31:09approximately you know that’s in the ballpark of what we’re aiming for and
31:14that’s it’s important to cut the places they cost per kilowatt hour at least by
31:1830% with the factory and our aspiration of course is to do better than 30%
31:23Costco what our doctrine in order to achieve the 50% cost reduction for the
31:28model 3 which is about a 20 percent smaller car and so would require for the
31:34same range twenty percent less energy that that means to get the full 40
31:39percent we need another 30 points coming from economies of scale which I’m
31:44actually very confident we would she have been at the factory
31:49what we’re doing is consolidating the production of the prac away from the the
31:53raw materials like cars coming in from from the mines like real cars of raw
31:58materials from the mines and then I’ll come quickly finish battery packs and
32:04this is actually never been done before so the batteries at least and what we’re
32:10able to 22 during this process is massively improve the cost of the of the
32:18of the census else in the paths because today if you were to trace the movement
32:25of the raw materials from when their mind and go through the various refining
32:30steps around the world and eventually put in a cell phone in that cell
32:34eventually is put into a module and a pack and a political car and then
32:38delivered to somebody that the raw material that molecule from the Mayan is
32:44doing around the world trip like three times it’s really crazy and they’re even
32:49steps of the process where it is converted first into one big opportunity
32:55for you
32:59so many things so jeffrey katzenberg someone from the way and he had a
33:07well-publicized accident in his testicle are a week ago or two weeks or a month
33:13ago when someone went through a stop light and a big SUV hit in that would be
33:20miles an hour and he said he’d be tested course saved his life and he said yes
33:27and he said it was just the most amazing thing so so here this guy well-known
33:33great publicity then do something on the internet it says to someone who’s
33:37driving along in the car was about to smash into them and the car and he
33:42didn’t see it and of course what and stopped turned around stopped and and so
33:48so here we have this safety much safer car than the other cars yes and I
33:56presume you know him and his mom Cindy tom tom tom is in his sixties and his
34:05mom Cindy I guess you won’t say how old she is but she’s more than sixties
34:10and so he drove his car to her house and she said I like this course she kept the
34:16car so so one of things it’s interesting to me is that I just you talk about
34:25safety but you don’t really say your promotion is this is a secret score ever
34:31I mean I know he say it but isn’t that an unbelievable opportunity to to
34:36promote to cheetah democrats are foreign to get more CDs buying senior pictures
34:41are compensated times children yeah I read that in fact in designing the Model
34:48S and the model acts safety was are absolutely paramount goal and you know
34:55my fight my family will be in the car my friends families if if if I didn’t do
35:04everything possible to maximize safety and so they went wrong I couldn’t live
35:08with myself so so we spent an enormous Lancet I’m on safety and the whole car
35:21is architected for for maximum safety and I rarely have we have physics and
35:27outside here which is very very important so there and I’ll just real
35:33briefly like whites i think is the car stickers hear things like cars of 5
35:38stars out of 5 starsbest not an actual statistical number
35:45$66 billion stars
35:50there’s an actual probability of injury which is that that’s the number that’s
35:58most important and the public entry you people look it up it’s sort of buried in
36:04the in the public transport website but they have to reach individual court yet
36:08every every car has a combined probability of injury and the Model S is
36:15still there were three years ago it still has the most probably the history
36:19of any car ever tested and that’s just not passive safety and then we have the
36:23active safety as well and the reasons basically are that because the the car
36:31does not have a big steel engine block in the front it we have a front trunk as
36:35well as real truck as they let requires that they’re actually coaxial with the
36:40with the axles so when you have a high-speed frontal collision what really
36:45matters is force of a distance it was just like jumping into a pool from up
36:49from a high high diving water something into a pool you’d want eighty pool and
36:56one without rocks in it
36:59really accommodating the same thing for a car
37:07what people don’t realize just like I think you think of that having a steel
37:10engine block is protecting you accept that it when you hit something you’re
37:13going sixty miles an hour so it’s tough being you that is important and so that
37:19deceleration distance is incredibly important or another way the length of
37:24the crumple zone is extremely important and the crumple zone on the front of the
37:29Model S is two to three times greater than that of any other prints which
37:33means that the impact attenuation is two to three times square then anyone with
37:40her family they want to buy one of these cards instead of against illegal they
37:44definitely if that this is if safety is a concern I for sure every subject very
37:54true it is the safest car by far the accident that jeffrey was where he was
38:02joined by this will be its that’s a side-impact collision that the reason
38:10that side-impact collision on the yes is so much better than another car is
38:14because the main structural component is the battery pack in the bullpen so
38:20effective for plan effectively acts as a big share plates to transfer the load
38:26from a side-impact into the rest of the car so that the whole car roofs sideways
38:32in a in a side-impact collision but what happens in a classic card game because
38:40you’ve got the big sea lanes are blocked in the front you got a huge portion of
38:43the mass in the front seat and and and the rest of the quarries is relatively
38:48weak you certainly have just sheet metal in in on this on the side of the car and
38:55on the floor plan of the car so that the effects of side-impact the load transfer
39:02for against the car
39:05to the rest of the massive the car is weak and as a result the side impact
39:10distance is dramatically greater that the net result is that you are much
39:16safer a site in fact so charges to a couple more questions and I’ll open it
39:21up everyone else but so I safety space taxi driver so so safety with all these
39:28other automobile companies having one safety issue after another not just this
39:33commission a problem but also about breaks in about it I’m sorry breaks he
39:40was out of batteries I’m sorry I guess me tanks why so when we have a car that
39:48existing that is for school in the atmosphere in addition as many say why
39:54don’t you think people have moved more rapidly to adopt technology which will
39:58offer to give them for free
40:01the pants if I think they actually there are a number of companies use the
40:06patents so it’s starting yeah yeah that’s one question number two is facing
40:13SpaceX and welcome back to over to SpaceX when I was a kid it was a
40:17television program called captain video and
40:24channel 5
40:27and the rocket will go up and fly around and come back and and then in the
40:32nineteen sixties we started going out into orbit and go to the moon and the
40:39rocket testing will take off the stage one after another
40:42would fall off like you and me and my first thought when I was happening to
40:45really understand why that would happen and now your idea is that haiti’s
40:51rockets 15 stay together and we could do ninety nine 51 something like that and
40:57therefore we can do it for one or two or three percent is expensive as we get it
41:02before I didn’t want to get up before I was actually in the rocket industry
41:09people have thought about reliability for a very long time and it’s it’s it’s
41:16just happens that its gravity is quite strong and it is just barely possible to
41:25get reasonable pillar to over it with an expendable rockets that he had
41:31reusability then that tends to get negative people to open sea camp that he
41:37do it so you gotta do two things really advanced technology so as far as the
41:45answers the airframe avionics the recovery systems like landing legs and
41:55the respect capability makes the Crockett such that if it was a pure
42:05expendable more difficult get approximately 40 study more than four
42:09percent of its bailout master albert had put this in perspective Norma rocket
42:13gets about two percent of its payload mass thought it was very small number
42:16but if if so if you can push that 22 percent to more like four percent on
42:26expand what basis and they’d be really efficient in the way that the
42:29reused takes place such that the reuse penalty is only maybe half a fast so you
42:36still haven’t met Taylor to over 2 percent that’s essentially what’s needed
42:42to achieve reusability and SpaceX has been out of power for 13 years and
42:50haven’t yet achieved its and I thought they were done thus far as evolutionary
42:56not revolutionary but I think we’re within shouting distance of this I think
43:01within the next year will be able to land the rocket in town we will tell and
43:08the rocket just not intact
43:11exciting videos are you want to watch the and but I think we’re close to
43:23landing at intact and then we need to examine the rocket once we get it back
43:27to see what needs to be strengthened over strengthened things that we don’t
43:32need to as much mass appeal to reusability with the with the rocket and
43:39so these things are not there are obvious to people on board with rockers
43:47revenge because of Iraqis to build it is sixty million dollars and the cost of
43:54the propellants fuel and oxygen and support is only about $250,000 now over
44:01$3,000 thereabouts but it’s basically yeah it’s it’s only it’s about as
44:09expensive as safe fueling up seven forty-seven ok my last question is
44:15hoover so this into your conference call and ask whether we could be asked you
44:23that but but but I love you actually ready to make any announcements in that
44:30area but my question is do this another company is much smaller than Hooper
44:35called left and I guess it’s Carl Icahn investor in that and i think is too and
44:43so my question is that what is it about hoover’s business that will make him
44:49immune from being attacked attacked by leftist lift have a chance against you
44:54really an expert in that some kind of scale that they have it makes it
45:01impossible for somebody to get to my question i think is probably
45:05I realize I’m expect no time thinking about it but my impression that this is
45:12the pressure with like whoa competence is that this is true for both over in
45:17left that’s what I like I can see ok so you don’t take some questions now is
45:24that okay and and then afterwards I’m sure that you know you have a couple of
45:30test this out on the mall and I’m not getting permission to sell them but but
45:35if you sign up for a test drive and we know about it and we will send you a
45:42present so you can get that afterwards but meantime questions I should mention
45:48that just reminded that there’s actually
45:5321 that is able to test drive today we’ve actually is arranged a special VIP
46:00just just few guys which is still the most are calm stepparent I’ll call ya so
46:09it’s just thank you
46:15number six
46:18hi I had the pleasure of test driving a sick just the other night so it was five
46:27minutes in new york city traffic but yeah I know you’re not doing a whole lot
46:34about the model 3 at this point but I’m just curious what you’re willing to say
46:39about the experience of driving a $35,000 so model 3 as compared to
46:46driving a Model S
46:47sure well as the Model S and the axe will be out kind of premium high-end car
46:55and we will try to leave with new technologies in the SPX so that that
47:03would be the advantage of the SPX but the three will be a small of about 20%
47:11smaller comparable in size to say 3 Series BMW or Audi April and but it’s
47:20it’s going to have a very similar deal 222 BS and it’ll it’ll be epic quakes
47:28operation good driving feel good handling and for the size of the vehicle
47:35great cargo space yes yes because it’s got a truck in the front rank in the
47:43back of the vehicle cargo space of the S is anywhere from fifty to a hundred
47:50percent more than that then that been a gasoline car basayev external dimensions
48:01you’re the one thank you so much for joining us think it is fantastic
48:07are you as well everybody else here enjoy hearing from you you were in the
48:12adventure
48:24charging stations right outside the door but I notice there are always full those
48:32are charging stations and the great synergy restaurant about charging
48:40stations and now I get extra business so I hope they’re paying you to put in bus
48:44stations but I i have you know what I wanna get to is a technical question
48:49interesting article about in rhode charges you know take your pick it can
48:54be inducted BRF is there any potential for that in terms of you know if there
49:01is is test involved are engaged
49:04looking for doing something with that I actually I think that’s unlikely to
49:10occur gets its really gonna be just long-range battery and then and then and
49:17then vote charging case occurred people’s business and then that’s really
49:23eighty to ninety percent of charging ten percent of charging its long distance
49:27which is what we have the the Super charges you can travel anywhere in the
49:31country
49:32actually this great road trip with my kids from LA to mount rushmore it’s up
49:38to you travel around the country
49:41freedom and a bit but I think locations that are not home or business and not
49:52long distance that there will be a small amount of charge america’s but it’s in
49:56the south by percent category that’s nice to have but it’s not it’s not
50:00needed for you
50:02for utility of the car
50:04oK so that’s that’s right
50:09aspiration actually has to put the charging stations somewhere where you
50:13can meet you can be happy then go and have a nice meal and grab a coffee and
50:19be on your way so that we can do some shopping so that I apologize to everyone
50:24I had the time and I didn’t realize that we were running over I thought that this
50:28was a bad time we talk in more time for questions would you be able to answer
50:32some questions to align can stay here for a bit
50:37there’s entertainment it’s now starting in three venues he need left in you we
50:43have a Steve Martin and Martin Short for comedy on the right thing you we have
50:49Michael Buble and a center Tony Bennett and Lady gaga
50:56pretty cool right

Ron Baron Tesla