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Unknown A
Let's get to Tesla, shall we? Because this is in terms of some of the fallout overseas and actually this is the curiosity of as Ion becomes more political. Yes, his wealth is extraordinary and all of that. How much of it, if it declines, will affect his overall performance, his doge image and all of that, I genuinely have no idea. I tend to think Tesla still his baby. It's the center of gravity of all of his net worth and power. But maybe he doesn't care anymore. He's realized enough gains, he doesn't care about the company.
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Unknown B
So Tesla, I was looking, makes up about a third of his net worth. So it's certainly significant in terms of his wealth and right now it really is struggling. I mean the stock price is way dunk put this up on the screen. And I mean to Tesla stock is really, I saw someone describe, it's basically like a meme stock. I mean the valuation doesn't really comport with reality anyway. And now they have this huge drop in sales and that's part of what is driving this drop in terms of the stock price. Let's put the next piece up on the screen. I can explain more the numbers behind the drop in sales in Europe in particular, Tesla sales have dropped almost by half 45% year over year. And if you just look at the eu, it actually has dropped by half year over year. So back In January of 2024 they sold some 15,130 Teslas in the EU.
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Unknown B
This year it was only 7,517. Now you may say okay, well maybe EV sales overall are declining. Not so. EV sales year over year are actually up. It's just Tesla sales which are weed down. I do think a lot of it has to do with him becoming this very toxic partisan political figure. You have to remember he waighed in. I mean obviously he like controlling our entire political system at this point. But he also intervened in Germany and the sales in Germany are down something like 63%. So it's an even greater drop. He also was meddling in the uk there's been a drop there as well. And there's been sort of a general European rejection of this foreign billionaire richest man on the planet trying to meddle in their politics. And also you have to think about the kind of consumer who buying electric vehicle.
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Unknown B
Most of them are liberal or lefties. So to have someone who is so closely associated themselves with Trump and the AfD and waiting in on the grooming gangs debate in the UK or whatever, that's going toa be a problem. For the Tesla brand. Now, there are some other factors that I think play into this that aren't just about Elon's politics. Although, like I said, I do think that that is a significant part of what is going on here. One is, as we've been discussing, BYD is selling fantastic EVs and so he's got more competition in terms of the electric vehicle market. And then the other one is people are potentially waiting for there's a new model of the car that's coming out in the spring. You probably know more about that than I do. So maybe they're just waiting and holding off for the latest new thing to come out.
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Unknown B
But I don't think it's deniable at this point that his brand is a big part of this drop. There's also a drop in China that would probably attribute more to the domestic competition y s the market. And there's about a 13% drop here in the US of Tesla sales. And of course, they also have just become this very visible symbol of him. So you've had Tes's Tesla owners putting those bumper stickers on. They're like, I bought this before Iew. Elon was crazy. You've had some instances of vandalism. I don't know how widespread that is, but cybertrucks getting spray painted with swastikas and Tesla charging stations being spray painted with swastikas, etc. So it has become this kind of like touchstone of resistance, visible symbol of him, et cetera. And it is significant to his net worth. But I wish I thought that it would matter and sort of check him and that this is really going to hit him where it hurts.
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Unknown B
But the truth of the matter is, as long as he's in control of the federal government, he has all of our tax dollars backstopping is net worth. And I do think his primary at this point, ideological goal and company passion is more SpaceX and the goal of getting to Mars. So I don't know. I don't know if this is gonna.
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Unknown A
Mean anything to Tim him or not'possible I'm not sure. We reached out to Doug Demiro, by the way, try and get him back on the show to talk about the Chinese EVs. Cause I saw a video of him just talking about how good they are and about why he's like, without tariffs and if we have pure capitalism, he's like're gonna get destroyed in this market. So I'm actually really curious to see if we can try to talk to him about it. As you said, look, obviously there's new model, so there's some stuff going on there. Tesla strategy as well as changed significantly to cut a lot of their prices for this. If there is lessing demand, it could feed more into that. They still have the production on their side as opposed to every other company. There's still big questions as to whether the Trump administration will continue some of the EV incentives that are there.
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Unknown A
It's actually a big open question as to whether Elon will even want those even.
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Unknown B
No, he wants them to go away.
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Unknown A
Right, because it would subsidize the competition, which let's be honest, not as good, and has way bigger production problems. So it's much more of a subsidy for Ford, GM and for the big three automakers than it is for Tesa, which has a proven it has factories, it has charging stations. It already has like the biggest market share out of all of it. So it would only make even more of a reason to invest to buy a Tesla.
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Unknown B
No, I think he sees it as a benefit which mostly is EV credits to go away. He sees it as hurting his competitors more then it hurts him. And I do think it's important to remember like Tesla benefited from huge amounts of government cash. They were really on the verge of going under. And Elon personally begged the Obama administration emails. The Elon s. The emails have been released of him really ha in hand, like we have to get this loan that enables them to be able to buy the factory in Fremont and live by it another day and build up this successful car company. The other thing I didn't realize this is all from this Washington Post reporting. The other thing I didn't realize is a third of Tesla revenue actually comes from selling these EV credits. And it's not just federal. A lot of that is state too because California of course has very stringent emission requirements.
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Unknown B
And so Tesla as an ev, zero emissions, they can then sell their credits to other automakers who need to be able to lower their emissions. So they sell and trade these credits on the market. That makes up about a third of their revenue. In fact, the first year that Tesla was profitable at all, it was all because of these state and federal credits that they were able to sell. So I mean this is really the story of Elon. He benefited massively from government taxpayer subsidies, dollars, loans, contracts, et cetera. But now that he's made it into this post position, he wants to pull up the ladder and make sure that other companies can also benefit from that kind of industrial policy, which is why he would be Perfectly happy to see the EV tax credits go away because he thinks that will hobble his competitors here domestically.
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Unknown B
Now I'm sure what he doesn't want to see to go away are the ban on importing BYDs. I think that he will make sure that that restriction on the market stays in place too.
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Unknown A
For me it's not about Tesla. It's true. We just can't allow that if we're gonna destroy our entire car market. I mean if you. And this is one of those where the car industry in America is maddening and yet necessary, both from a jobs perspective, but just from the ability to manufacturer. I personally, if I had the choice, there's no question in my mind I'm buying Xiaomi or byd. But I'm not going to like as an American consumer and this is where I'll even argue against my own freedom. I shouldn't be allowed to because our manufacturing sector, those jobs, it's just too important to the United States, to our future defense capacity. And I don't thinkud the Chinese, you know, if anything I admire you, your ability to prop that up in a 15 year period. We can learn from it. We should absolutely study it and see what we can do to copy it.
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Unknown A
But yeah, I mean this is not even about Tesla. I'm just like, we cannot let these companies go bankrupt. Like World War II is often overused. But you know, if you look back in the day, the ability for those GM factories to overnight go switch to war production is super important. And when you lose that then you become the country that we are right now, which is a husk of what it used to be that produces Nothing and has 25% of its GDP writing on Jensen Won's motorcycle jacket, which I don't wanna lift that world, right?
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Unknown B
No, I don't disagree with you. I don't even disagree with Elon getting that loan at Tesla at a time when he needed it because no, I think it should have come with requirements, workers to unionize and things like that. What I object to is that the industrial policy he benefited from, he wants to now shut off the tap and spigot when it comes to his competitors. So in any case there's another piece of this that is really important which is Ryan and Dropsite did a fantastic job breaking the story about this supposed $400 million contract for armored Teslas coming out of the State Department. So they just looked at the list of procurements, whatever they see this contract, it's the largest line item and lo and behold it is for Tesla, $400 million, the largest contract coming out in the State Department. So let's put the story up on the screen.
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Unknown B
This was Ryan's original story, now updated, says armored Tesla was forecast to win $400 million State Department contract after Trump's election. So after this was discovered, then they went in and changed the language so it no longer said Tesla, it said armored electric vehicles. Then the story was that, oh, actually this was initiated during the Biden administration and the number wasn't 400 million, it's really 408,000, something like that. So that was their story as like, oh, actually this started under the Biden administration and we didn't have anything to do with it and this isn't going to happen. Anyway. Now we have another piece of the story. We can put NPR to this reporting up on the screen. So they were able to obtain the original State Department document that shows the Biden administration was not awarding a $400 million contract. They were awarding only 483,000 do.
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Unknown B
And sometime after Trump was inaugurated, that amount got boosted from 483,000 to 400 million do. So either this is an extraordinary clerical error that just happened to nor to the tune of hundreds of millions of dollars to the dude who is currently running the federal government, or they intentionally went in to try to funnel hundreds of millions of dollars into Tesla and basically got caught. Now, this amount of money, by the way, just so you understand how much this is in the context of the State Department armored ###les and this would be to armor up cybertrucks. A bunch of experts said this may not even make sense to use cybertrucks for this purpose anyway. But putting that aside, this would mean that they were replacing all 3,000 armored cars and SUVs around the world that are used to transport diplomats, VIP'other officials working for the State Department.
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Unknown B
They replacing all of them with cybertrucks, which are expensive, and then armoring them, which is also another, let's say $80,000 to armor these things up. You have to go at that incredibly maximal approach to even come close to the $400 million that Elon was set to have sent to him. So it really looks like a potentially massive scandal and very clear example of self dealing and just theft and robberies effectively of the American taxpayer to take this $483,000 contract and just secretly boost it to $400 million. So worth a lot more investigation here because like I said, it's either a very convenient clerical error or naked robbing of the Public purse by the dude who was running the government right now.
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Unknown A
I'm going to go with the job for Doge. This sounds like a good job for Doge, doesn't it?
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Unknown B
Interesting. Well, Ryan's reporting seems to have spike the deal.
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Unknown A
And this is another thing, journalism matters. Ryan really is the goat in terms of his ability to sniff some of this stuff out. And if you think about his track record, I've been seeing it recently. It's not only stuff like this, but the Romanian election. I mean huge amounts of drops. Site reporting is responsible for Elon himself and Mike Benz digging into the Romanian.
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Unknown B
Usaid and it's amazing news Brand already ess is incredible.
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Unknown A
So anyway we stand Ryan here over here.
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Unknown B
Ryan Grimm may have single handedly saved the government more than entire. No, I'm talking about it.
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Unknown A
Yes here he could save the government here and he could save the government of Romania.
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Unknown B
I'm talking about he s probably saves more money, like actual money, but for the federal government than the entire Dogean Musk project, etc.
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Unknown A
It would be possible. Let's boow this last one up here from usaid. This was flagged by Pedro Gonzalez. He's always an interesting. I'm not so sure though what to make this. So he says do you think Musk went after USAID because ofe its woke or because his rival had just recently spored its first federal contract? Is it possible to using culture war stuff to masc an agenda? So apparently In August of 2024, OpenAI had revealed its first agency customer for ChatPT Enterprise which was USAID would use the tool and then apparently it was canceled by the USAID cuts that were there. I'm not so sure if that one is or is not of the agenda that Pedro flags, but it does get to the whole idea of conflict of interest in the first place. It's like you're gonna have like personal agendas and Stargate and all this other stuff.
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Unknown A
Then how can you be sure that this is being done for correct purposes? As I said, I'm guy, I'm not a chat cptt person, but I would just ask that we would try to reward a contract based on some sort of competitive bid or not. I can have open questions in our mind. This isn't the biggest candle, but it is still important. It's still important.
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Unknown B
It's just important to realize how many whether this was the motivating factor for Elon going after USAID or not. The fact that we have to question that, that's the point. And with USAID in particular, you have that. I mean, we know he despises Sam Altman. They're locked in legal battles, he goes after him, they're fighting over the origin and the development of OpenAI, et cetera. So they're certainly convenient for him that this contract is, I'm sure at this point completely spiked, dealing a blow to not only someone that he has personal animus towards, but also to a significant competitor. And I think Elon cares a lot about winning the AI race himself. So you've got that. You've got. Apparently USAID was also investigating the starlink Ukraine situation that was going on. So you have that as a potential motivating factor as well. And then also, as I mentioned to USAID was involved in backing the end of AP part.
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Unknown B
You may hold a grudge over that as well. We don't know. And maybe it was none of those. Maybe none of those factored in the fact that we have to ask and we don't know. And he has so many personal interests intertwined in almost all of these agencies is a problem. It's a big problem in and of itself. And especially because Trump has just given him free reign to really do whatever he wants. And some of the moves do seem just naked self deal. The $400 million Tesla contract, obviously nakedly self dealing. If that was intentionally changed, that's insane, right? Insane levels of corruption. You also have attacks on very specific offices within agencies that happen to be the ones that were going after Tesla or going after SpaceX and investigating them for alleged infractactions and violations. So some of it just seems very difficult to deny, especially when you look at the overall picture.
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Unknown A
Hey, if you like that video, hit the like button or leave a comment below. It really helps get the show to more people.
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Unknown B
And if you'd like to get the full show and in your inbox every morning, you can sign up@breakingpoints.com.
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Unknown A
That'S right, get the full show. Help support the future of independent media@breakingpoints.com.