Elon Musk at AllThingsD D11
Questions on ElonsFAQ asked in this interview (3)
Transcript
0:04Walt MossbergSo without further ado, we're going to thank you for coming back. We know it's been a really long day, but this is, this guy's a real treat and it took me a while to get him to come here, but we got him to.
0:15Walt MossbergWe actually went back and forth a lot.
0:17Kara SwisherWe actually had to corner him at
0:19Walt Mossbergsouth by Southwest and Birmingham and everything else. But he's a really interesting entrepreneur, very much a visionary. Many people think in space and in cars and in all kinds of solar,
0:32Elon Muskall kinds of things.
0:50Kara SwisherSo first of all, thank you so much for coming and we are sorry for having cornered you at south by Southwest.
0:58Walt MossbergNot that sorry, but okay.
0:59Elon MuskGreat shoes, by the way.
1:00Walt MossbergThank you. Do you like this?
1:06Kara SwisherI'd like to start by. I mean, you're involved in several really cutting edge kinds of things that are cool. But let's talk for a minute about this. The electric car, which is really an old concept in the car industry, right?
1:22Elon MuskIt is actually.
1:23Kara SwisherAnd, but you know, there's a modern take on it. Why are you in that business? And do you agree with what has been written about you that it's fair to say that you have proven this
1:38Audience Memberis
1:40Kara Swisherthis can be sold at a profit in market conditions?
1:46Elon MuskSure. So the reason for Tesla was not because I thought that the there was some huge opportunity in electric cars or that I thought it was some rank ordered best way to get a return on investment or something like that.
2:03Elon MuskIn fact, I think starting at a car company, particular electric car company would have to rank as one of the dumbest things you could possibly do on that scale.
2:10Kara SwisherOkay.
2:12Elon MuskAnd it may seem like, I mean today obviously we've got quite a, quite a high market cap, let's call it that you do. And so it may seem, oh well, this is sort of, obviously a good thing to have done.
2:29Elon MuskBut for many years people would. People regarded this, in fact most people, almost all people regarded it as stupid or insane or both, you know, to done that. So it's not.
2:45Elon MuskSo the reason for doing it was not because I thought it was some great opportunity. The easiest thing for me to have done after PayPal would have been start a new Internet company.
2:54Elon MuskThat would have been like falling off a log. I mean, quite, really easy. And so the reason I did it was because it was clear that we were not going to see electric cars from the incumbent manufacturers.
3:10Elon MuskFor a while there I thought that we potentially would because you had the EV1 from General Motors, for example, and it seemed like the obvious thing to do would then be to the EV2, EV3, frankly, if general Motors had done that, they would be in a far better position today.
3:27Elon MuskBut then instead what General Motors did was as soon as California changed the regulations, they recalled the EV1s and just to make sure that nobody could get them back, they took them to a junkyard and crushed them.
3:39Elon MuskAnd if you've seen the movie who killed the Electric Car? You'll see that actually those customers tried their best to keep the cars. And when the cars were taken to the junkyard and crushed, they held a candle at Vigil.
3:54Kara SwisherYeah, because the cars were leased, they were not ever sold outright.
3:57Elon MuskYeah, yeah, they held a candle at Vigil as though it was someone dying. And I think that should be a pretty big wake up call. If people are holding a candle of visual for your product, maybe you shouldn't cancel it as you're killing it.
4:14Elon MuskYeah, maybe you shouldn't cancel it,
4:18Kara Swisheryou
4:18Elon Muskknow, and yeah, so, but they did and so they can't all activity. So the reason for, for Tesla was to show that it actually is possible to create a compelling electric car or you know, long range car, electric car.
4:38Elon MuskAnd if you did that, that people would buy it. Because the car industry was operating on what I believe to be two false premises. One was that you could not make a compelling electric car.
4:49Elon MuskOne that was aesthetically appealing, long range, high performance, all these things. And, and that even if you did all those things, the car industry's opinion was that people would still not buy it because it was electric and they had some fiveness for burning gasoline.
5:04Elon MuskPeople had.
5:04Walt MossbergWhat moved you into it? What was the starting? You said Internet company like falling off a log, easy to do. Why that area then?
5:12Elon MuskWhy electric cars? Oh, so because I think it's important that we transition to sustainable transportation. If we don't transition to sustainable transport, obviously technologically it's unsustainable. And even if they were not an environmental issue, in fact, even if you were to say hypothetically that emitting carbon was good for the environment because of the scarcity of oil and natural gas and so forth, we would eventually face extremely high gasoline costs and the economy would grind to a halt if we did not find some sustainable means of transport.
5:53Kara SwisherDo you worry that the electricity that is generated and, and used when the cars are recharged and plugged in is. A lot of it is generated from coal.
6:04Elon MuskDoes that bother you? Yeah, I mean, depending on where you are in the country, you know, say roughly half of it is, it is not coal, but to roughly half of it is hydrocarbon based.
6:18Elon MuskHowever, There are two obvious rebuttals to that. One is that if you take the same source fuel and you burn it at the power plant level, you will get two to three times the efficiency than if you burnt it in the car itself.
6:33Elon MuskBecause at the power plant level, you're not constrained by mass and volume. So you can have something that's big and heavy and you can also take the waste heat and generate a steam and use it, turn a steam turbine.
6:44Elon MuskSo you get what's called cogeneration. So your maximum extractable energy is much greater for the stationary power plant than if you burnt that same fuel in a mobile transport where you have formal constraints.
6:57Elon MuskAnd then the other factor is that we have to find sustainable means of electricity production anyway. So if you believe in that predicate, you can write that predicate and say, given that we must have sustainable electricity production, the obvious move for transport is electric.
7:15Walt MossbergSo when you're talking about these ideas of getting. Doing this particular thing, one of the things that I think struck a lot of people about you is the scale of the vision that it's not.
7:25Walt MossbergOne, that it's very difficult, two, that it's a little crazy going on with SpaceX. At the same time, what do you imagine is you've had many years doing this, many critics, you're not going to make it.
7:38Walt MossbergYou're getting a lot of. Walt was going to ask about subsidies, I think that you get.
7:41Audience MemberWe'll talk about that.
7:42Walt MossbergYeah. What is the. Why these kind of projects? This is sort of a bigger question I want you to. But the idea of the bigness of the project, because there's been.
7:54Walt MossbergThe industry's been littered with electric car funerals, essentially, and not as many candlelight vigils, obviously.
8:00Elon MuskRight? Yeah, there have been many car company failures, not just electric, of course. And honestly, if I had like a dollar for every time somebody brought up DeLorean or Tucker, I wouldn't need an IPO.
8:15Elon MuskIt would have been perfectly financed just on that alone. So I know when I was in college, I wanted to be involved in things that I thought would affect the world.
8:28Elon MuskAnd there were three areas that I thought would. Would most affect the world, and one of them was the Internet. So did a couple of companies in that. But then it seemed like after PayPal was like, there's a lot of really talented entrepreneurs and a lot of capital doing Internet ventures.
8:46Elon MuskSo it didn't seem like I could necessarily be all that incrementally useful in the Internet arena. And so it's time to then go to the other two areas which were sustainable energy and space exploration.
8:59Elon MuskIn particular, developing the technology necessary to make life multi planetary.
9:04Kara SwisherSo multi planetary life is. Might be more interesting than cars. We'll get into that shortly. But I do have to ask you this is. It's an important. It's very important that you've made an attractive car with longer range than I think.
9:21Kara SwisherThen you're right than people thought possible. That's electric, all electric, but it's fairly expensive, I think, at least up front. What does it cost, your most successful one?
9:35Elon MuskWell, before tax credits it's about $70,000. After tax credits it's like 60.
9:42Kara SwisherAll right, now we're getting to tax credit. So there's like a. There's some kind of federal tax credit, right?
9:51Elon MuskThat's right.
9:52Kara SwisherFor buying a pure electric.
9:53Elon Musk$7,500. Yeah.
9:54Kara SwisherAnd then you were telling me backstage a whole bunch of states, 15 states or something have these.
10:02Elon MuskRight. There's different types of credits. So the first thing I should say is that people think of electric cars as receiving a subsidy, but in fact what's occurring is that they are receiving less of a subsidy than gasoline cars.
10:19Kara SwisherOkay.
10:20Elon MuskIf you would actually look at the subsidy of gasoline cars and particularly if you price in the economic or the environmental damages, what's really occurring is that every time you buy a gasoline car there are huge subsidies occurring and you can actually tell that these subsidies are higher than the subsidies for electric cars because people are not buying electric cars, except I mean ours.
10:46Elon MuskNot huge.
10:47Kara SwisherThese are upstream subsidies to the oil companies and so forth for the gas.
10:51Elon MuskThey're both direct the whole tax. Yeah, there's some enormous number. It's like half a trillion dollars in subsidies to.
10:59Kara SwisherBut you do get, you also get some federal and state subsidies, right?
11:05Elon MuskYes.
11:05Kara SwisherAnd then there's this. These credits that you are able to sell to the other car companies. Can you explain what that is?
11:11Elon MuskSure, sure. Although just to emphasize again, it's pretty obvious that whatever subsidies are occurring for electric cars are less than for gasoline cars. Otherwise things like the Chevy Volt or the Nissan Leaf would sell in large quantities, but they are not.
11:27Elon MuskAnd so that's like an obvious test then with respect to zero emission vehicle credits or ZEV credits. These apply to about 40% of the US population and they were actually put in place quite a while ago to deal with pollution and air pollution in.
11:50Elon MuskPlaces like LA and the Bay Area, NY and so forth. So whenever you're driving cars in dense of an area, you're essentially emitting a bunch of Toxic gases that negatively affect people's health and obviously the quality of the air.
12:04Elon MuskAnd it's pretty obvious in LA during the summer. So in order to motivate manufacturers to move away from that, the states enacted the ZEV credit mandate which was that a small number of electric zero emission vehicles have to be made by all large scale manufacturers.
12:24Elon MuskAnd if they don't make those vehicles then they have to try to purchase ZEV credits from someone who has. But when we sell a ZEV credit, we sell it at 65 cents on the dollar.
12:36Elon MuskSo the best thing that another manufacturer could make would be electric cars because then they get 100 cents on the dollar for every tax credit.
12:42Kara SwisherSo why don't they?
12:46Elon MuskWell, I'm hopeful that they will,
12:49Audience MemberI
12:49Elon Muskthink to some degree at least some of the manufacturers were hoping that no one would come up with an electric vehicle that anyone wanted to buy and that California and other ZEV states would repeal their ZEV mandate because they've lobbied for that outcome many times and have thus far been unsuccessful.
13:09Elon MuskIf Tesla was unsuccessful, then I think they would have been able to repeal the ZEV mandate.
13:14Walt MossbergSo when you're getting into the concept of these cars, these prices are still, along with subsidies and everything else, it's still a high price tag. What is your goal is to bring in?
13:23Walt MossbergI mean you have, there's lots of people here who own Teslas.
13:25Elon MuskYeah. Thank you everyone. Thank you for providing Tesla by the way. So to say all of you guys who bought Teslas, you guys are some
13:32Kara Swishersignificant percentage of your, your customers are here. But, but when there is a larger
13:39Elon Muskcountry, farsighted, awesome individuals who bought Teslas, where do you actually, I'd like to say a special shout out to Tony, say who has the largest, made the largest number of Tesla orders in the US of 100 cars for his project in downtown Vegas.
13:54Walt MossbergDowntown Vegas, yeah.
13:55Elon MuskSo thanks Tony.
13:57Walt MossbergSo that's a very, it's a super interesting project. How do you get it down to levels that. Tony of Zappos. No, we don't have to be Tony of Zappos.
14:06Walt MossbergBuy.
14:07Elon MuskSo Tesla, when we first started out, I actually wrote a blog piece outlining Tesla strategy and it's been out there for a long time and it really just outlined the sort of three step process that Tesla is going through to get to mass market compelling electric cars.
14:25Elon MuskAnd step one was making the Tesla road. So high price, low volume, then mid price, mid volume and then low price, high volume. So those are, you know, we're in step two, the price of the Model S is actually less than it may seem at first because the cost of gasoline is so much more than the cost of electricity that you save a lot of money not buying gas.
14:45Elon MuskYeah, exactly. And you know that, that depending upon how you count it is, you know, somewhere in the 15 to $20,000 region
14:55Kara Swisherover the lifetime of the car over
14:57Elon Muskthe, over sort of seven years figure, it's roughly $2,000 a year depending upon what your assumptions for gas prices are.
15:07Kara SwisherYeah, but when will there be a $30,000 or $35,000 Tesla?
15:13Elon MuskYes, the step three, I'm expecting in about three to four years.
15:17Kara SwisherAnd what's required to get you from here to there, is it got to do with design and technology or does it have to do with the elements scale or what?
15:24Elon MuskWell, the, I think any new technology needs at least three major iterations to get to, to the mass market. I mean certainly cell phones have gone through many more than that.
15:38Elon MuskAnd I'm sure people remember like the Wall street one where he's walking down the beach on the giant brick of a cell phone on his ear and that thing was super expensive and lasted for 30 minutes.
15:50Elon MuskAudio quality was terrible and now you can have a supercomputer in your pocket for 100 bucks. So with electric vehicles similar trying to compete with gasoline cars that have had 150 years and trillions of dollars spent on them.
16:06Elon MuskSo I think if we can make it there by our third generation, that's pretty awesome. So I think there's certainly design optimization is one factor and then the other is the car will be a little bit smaller, so maybe 20% smaller than the Model S and we'll have an order of magnitude greater production.
16:22Elon MuskSo we have the economy scale to help us out. I think those three factors will take us to 50%.
16:27Kara SwisherAnd, and when will you be at a point where if even if you didn't have subsidies or and credit sales, you would be profitable.
16:37Elon MuskYeah. So I think we're anticipating being profitable or I should say even better. Well, better than slightly profitable. In the fourth quarter this year we're, we're projecting 25% gross margins absent ZEV credits.
16:54Kara SwisherAbsent zip.
16:55Elon MuskAbsent zip credit.
16:56Walt MossbergSo not getting this extra subsidy, but
16:58Kara Swishernot absent the tax subs, right?
17:01Elon MuskYeah. And there's a consumer sort of tax credit which is effectively something that improves the level of demand for the product, but doesn't directly affect our gross margins. And so we don't get that.
17:15Elon MuskTesla doesn't get the tax credit, the consumer does.
17:18Walt MossbergWhy haven't many car companies raced to you and you're showing that there are cars, people, there is an audience for this. Where are the rest of these companies now?
17:26Elon MuskWell, I'm hopeful that our results from the first quarter will cause the other car companies to enter the electric car arena in a significant way. But until now they didn't really have a good basis for that because they would look at you say, what are the examples of successful electric cars?
17:46Elon MuskWe did have our Tesla Roadster out there, but they wrote that off as being something that's really low volume, kind of a niche product for techno geeks type of thing.
17:54Elon MuskAnd so they wrote that off.
17:57Audience MemberRight?
17:59Elon MuskAnd yeah, it's actually funny because before we were able to get the Roadster out, they'd say, well, you couldn't possibly make that car work. And then when we made the car work, they'd say, well, nobody's going to buy it.
18:11Elon MuskAnd then people bought it and then we announced the Model S and so many people called bullshit on that, it was ridiculous. And yet actually we were able to bring it to market.
18:24Elon MuskAnd then we brought it to market, they said, well, you're never going to be able to produce the volume. And we did that. And then they said, you will never be able to make a profit.
18:30Elon MuskAnd then we did that in Q1. So I'm hopeful that people will observe that there's a trend here.
18:42Elon MuskAnd if so, now that we have been profitable, I think other manufacturers are more likely to embark on electric vehicle projects. And it should also be mentioned that we do make electric powertrains for Daimler and Toyota.
19:00Elon MuskSo for the electric RAV4, we make the battery pack and powertrain. For the Mercedes B Class that's coming out later this year will be making that whole.
19:10Walt MossbergAre they open to that? Do you feel that they're open? I mean, a lot of the, you know, you can paint the car companies any way you want, but are they.
19:15Walt MossbergDo you feel as if they're open or thinking about that?
19:18Elon MuskYeah, I think so. The challenge is to convince them that it should be more than just a
19:25Walt Mossberglittle niche product or a hybrid or something like that.
19:28Elon MuskYeah, well, they may. I mean, Toyota obviously is quite big on hybrids, but the, to convince them that electric cars should be a mainstream item. There's still a bit of work to do on that front.
19:40Kara SwisherAnd until they're a mainstream item in terms of having enough of an infrastructure of charging, obviously you've done a lot help that problem with range, but still people want to feel like they're not going to be stranded, that there are going to be charging stations and I know.
19:58Elon MuskYeah, yeah, we've got an announcement about that tomorrow. Oh, you do? Yeah.
20:02Kara SwisherYou want to announce it here now?
20:04Elon MuskWell, no, you just sort of let
20:07Walt Mossbergthe cat out of the bag. Might as well just.
20:08Elon MuskWell,
20:20Walt MossbergBecause you're so quiet and retiring
20:21Elon Muskmost of the time.
20:22Audience MemberThat's fine. Exactly.
20:23Walt MossbergYou never do anything. Just mouth off at a New York Times reporter, for example.
20:27Elon MuskRight,
20:32Elon MuskYeah. All right, well, so we have something called the supercharger, right. Which is an advanced charging technology that we developed and yeah, I guess I might as well let the cat out of the bag.
20:48Audience MemberWhy not?
20:53Elon MuskSo the supercharging technology is something we developed because obviously traditional charging has been way too slow and it's not effective for long distance travel. So it is very important to address this issue of long distance travel because when people buy a car, they're also buying something which is a sense of freedom and ability to go anywhere that they want and not feel fettered.
21:22Elon MuskSo we had to make something that was really quick to charge. So that's what we developed. And there are actually a bunch of them out there now in California and on the east coast from allowing you to go from Boston to D.C.
21:36Elon Muskand travel throughout California and Nevada. And what we were going to announce tomorrow is that there's going to be a dramatic acceleration of the supercharging network and by the end of next month we will triple the supercharger coverage area.
21:55Kara SwisherWow.
21:57Walt MossbergWhere is it going?
22:01Elon MuskSo it'll be. There's actually a map that will be go live tomorrow obviously, but people will be quite surprised to learn this. But at Tesla,
22:19Walt Mossbergblame it on the CEO of SpaceX.
22:21Elon MuskYeah, exactly.
22:23Kara SwisherOr if you want, you could blame it on me.
22:24Elon MuskIt's all right, blame it on it's Walt's bulb.
22:28Kara SwisherBecause you know, you like tangling with reviewers and I'm a reviewer.
22:31Elon MuskYeah, but you do good reviews.
22:33Kara SwisherI haven't reviewed your car.
22:35Elon MuskWell, I mean, I should say accurate reviews.
22:39Kara SwisherThank you.
22:41Elon MuskSo the supercharged network by the end of this year will have covered most of the major metro areas of the US and southern Canada. And in fact, you'll be able to drive all the way from LA to New York just using the supercharger network.
23:02Kara SwisherAnd does that include not only putting it in places where it doesn't exist today day, but also increasing the density on the coast?
23:11Elon MuskAbsolutely. Exactly. Good point. The density is not quite as good as it should be. So we're both improving the density of the supercharger stations along well traveled routes as well as increasing the geographic scope of the network.
23:22Kara SwisherThat's hugely important.
23:23Elon MuskIt is, absolutely.
23:24Kara SwisherBecause even. Tell me if you think I'm nuts, but I think that it's like in the old days, people would go and buy a desktop tower computer and they would not buy one unless it had five slots for cards in it.
23:39Elon MuskRight.
23:41Kara SwisherThey would never open the computer and put a card in it.
23:44Elon MuskWell, I do.
23:44Kara SwisherYeah, you did. But I mean, a lot of people would be told by their techie friend, you have to have, you know, three empty slots or five empty slots, but they never opened it and put the slots in.
23:54Kara SwisherEven if you only drive your car commuting to work well within the range of the car and a few errands and stuff, you always want that sense of freedom.
24:03Kara SwisherIf I had to, I could get in this car.
24:05Elon MuskExactly.
24:05Kara SwisherAnd go from Boston, D.C. or something.
24:09Elon MuskYep, that's right.
24:10Kara SwisherI mean, psychologically, it's really very, very important.
24:13Elon MuskIt's extremely important. And so on Tesla, because all Teslas are wirelessly updated by the cell networks, we actually update the supercharger locations in the car. So on the Tesla map, if you just tap the little lightning button, it'll actually direct you to the nearest supercharger.
24:31Elon MuskSo as you're driving, you can go wherever you want. And with the release later this year, you'll be able to navigate anywhere in the country and the car will automatically route you to the superchargers along the way.
24:43Kara SwisherFantastic.
24:43Walt MossbergSo one question. Is that why you hit back so hard at the times? I mean, we joke about it and stuff like that, but many people don't do that.
24:50Walt MossbergWhat was the reasoning? I know you've said a lot about this, our brother.
24:53Elon MuskYeah.
24:54Walt MossbergWhat was your reasoning? It's like, you're not going to take this or you.
24:57Elon MuskYeah, well, I thought about it a fair bit before actually responding. So it wasn't sort of just a totally off the cuff thing. But when the article was published, we saw a significant decrease in sales, particularly in the New York Times sort of main readership area, sort of in the Northeast, particularly in cold areas.
25:21Elon MuskAnd the. The article, it really sort of played to people's biggest fear about electric cars, that you'll run out and that they don't work in the cold, which is actually completely false.
25:36Elon MuskThey do work really well in the cold. In fact, our highest sales per capita are in Norway. And the single person who's bought the single largest number as an individual of Teslas literally lives above the Arctic Circle.
25:50Walt MossbergWhy
25:52Elon Muskhe's an ophthalmologist in a. Jens Kotholm is His name. He's a great guy.
25:57Kara SwisherWait. He's an ophthalmologist. He lives above the Arctic Circle, and he has a whole bunch of electric cars. Yeah, I just wanted to get.
26:04Elon MuskI mean, what are the odds?
26:05Kara SwisherI just wanted to get the picture.
26:06Elon MuskImprobable scenario, but true.
26:08Kara SwisherIt's amazing. Yeah. And every day he takes an electronic pill also.
26:14Elon MuskYeah, exactly. But I drove them through, like, the, you know, winter, which is permanent midnight. And so obviously they work pretty well. And in fact, after that article we had, since it was still sort of winter in Norway, we actually had someone do it.
26:31Elon MuskA Model S test drive from, I think, almost near the Arctic Circle to Oslo.
26:37Audience MemberOkay.
26:38Kara SwisherBut, you know, as I'm a reviewer, we've already discussed, and some people in the room know, but. So part of a review is factual. This is actually.
26:49Elon MuskWhat part of the review is that factual?
26:51Kara SwisherNo, no, no.
26:53Audience MemberOkay.
26:53Kara SwisherNo, let me explain. Part of the a review is opinion. Yeah, sure. So, but you have to state if you're doing specs, if you're doing, like, in my case, it's.
27:05Kara SwisherIt's a battery test on something I have to explain. This is how I did the battery test. This is what the result is.
27:11Elon MuskRight.
27:11Kara SwisherI can then have an opinion. You might have a different. You might say, well, even if I accept Mossberg's battery test, I don't agree with him that this is good enough battery life.
27:21Kara SwisherI need better battery life. So I think he's too easy on this product or the other way around, you know, whatever. So part of it is facts, and part of it is what opinions you draw from that.
27:31Audience MemberSure.
27:31Kara SwisherYou know, the screen is this big. The camera has this. Those are facts. So was it. Was it facts for the guys?
27:38Elon MuskThat it was a fact thing? In fact. In fact. So when we got the call back, we looked at the data logs as compared to the article that was written, and the article was factually incorrect in multiple places, in fact.
27:57Elon MuskAnd one could perhaps ascribe that to error on his part, but by the 10th mistake in a row, that is interpreted in the wrong direction. That. That lacks credibility.
28:10Elon MuskAnd so, you know, it's like if you did that battery test on something and you said factual information that was untrue in a very important way. I mean, that's a big deal.
28:28Elon MuskAnd so if we didn't speak out against that, that article would live forever and people would have this really wrong impression of the car, and they would think that what he said, if we did not oppose it, was.
28:38Kara SwisherThe Times didn't back Down. Did they?
28:40Elon MuskActually, the public editor of the Times did an investigation and concluded that the article was wrong. We disagree. I disagree with the public editor over the motivation. In other words, the public editor said the article was wrong, but didn't agree that it was intentional.
28:58Elon MuskWhereas in my opinion, it's difficult to interpret that as anything but intentional.
29:03Kara SwisherAnd then what? Then just to close this off, wasn't there some controversy about the fact that you had put sensors on the car that aren't normally sold on the car?
29:11Elon MuskNo, there's the same sensors.
29:12Kara SwisherOkay. All right, so space, this is really important, but space, the final frontier.
29:19Elon MuskSure.
29:21Kara SwisherAre you. What is your ultimate plan or goal for SpaceX? What is it you want to do with it? Is it just to prove that a private company can deliver stuff to the space station or what is.
29:33Audience MemberNot at all. No.
29:34Elon MuskLike I said, it's. The goal with SpaceX is to improve rocket technology and spacecraft technology and keep improving it every year until ultimately we're able to send people to Mars and establish a self sustaining base on Mars.
29:53Elon MuskThat's the Mars. Yeah.
29:55Walt MossbergOkay.
29:55Elon MuskTo make life multi planetary, as they're saying. As long as I expect that this will necessarily occur. I mean, I agree that this is an unlikely outcome, but if we do not keep improving space technology every year, then that will never happen.
30:13Kara SwisherDidn't George W. Bush want to go to Mars?
30:16Elon MuskHe did, actually. Not many people know that.
30:19Audience MemberYeah.
30:19Kara SwisherSo that's kind of put you and George W. Bush in the same category as people.
30:23Elon MuskGeorge is his dad.
30:26Kara SwisherOne of them wanted a space program. Get us to Mars, right?
30:32Elon MuskYeah.
30:32Audience MemberActually,
30:35Elon MuskGeorge H.W. bush, shortly after gaining office, actually asked NASA to come up with a plan in 90 days for sending people to Mars. And NASA did come up with that plan, but it was half a trillion dollars.
30:51Elon MuskSo he decided that maybe it wasn't such a great idea. And that was obviously 20 years ago, whatever it was.
30:56Walt MossbergSo why Mars?
30:57Elon MuskExplain what half a trillion really means. What's attracting.
31:03Kara SwisherThat really was a half a trillion dollar thing.
31:05Walt MossbergNo, it's cheap, right?
31:05Elon MuskYeah, no, it's. Well, the defense budget's bigger than that.
31:08Walt MossbergSo why Mars? Why Mars? Over. Now, just to preface this, Elon went to Space Camp many years ago with Sergey, Larry, Megan, James, Joaquin, Pierre, Omidier, a bunch of you very strange people.
31:21Elon MuskShortly after I started SpaceX.
31:22Walt MossbergRight. Yeah. What, why? And you know, were you in a Star Trek mode or. What was the. What was the space camp? I know you guys did that, but
31:32Kara Swisherthey had out before when you.
31:33Walt MossbergWhat was the.
31:34Kara SwisherWhat does it got you interested because you said a few minutes ago that, that there were three things that you were interested in. One was the Internet, one was the electric car and the other was space.
31:44Kara SwisherSo what got you into space? Right.
31:47Elon MuskSo if you think about the future of humanity, it's going to fundamentally bifurcate in two directions, or life as we know it. Either it's going to become multiplanetary or it's going to be confined to one planet until some eventual extinction event.
32:01Elon MuskSo I think it's much more important
32:03Walt Mossbergto put it that way. Let's go to Mars.
32:07Elon MuskAnd by the way, I'm optimistic about life on Earth. It's not as though I'm like, I think we're danger.
32:12Kara SwisherBut you're convinced there will be an extinction event.
32:14Elon MuskWell, I mean, that's pretty obvious from the fossil record.
32:17Kara SwisherYeah, I mean, I think about it.
32:20Elon MuskYeah. I mean it's for sure we face dangers that the dinosaurs didn't face because it could be us. Yeah, exactly. Yeah, yeah, yeah. So we could do ourselves in.
32:33Kara SwisherThey actually had better diets, the dinosaurs.
32:35Elon MuskYeah, exactly.
32:36Kara SwisherA lot of things they.
32:38Elon MuskSo I just think we want to have a future ultimately where humanity is out there exploring the stars or spacefaring civilization and the things that we read about in science fiction books and see in movies becomes true.
32:51Elon MuskWe don't want that always to be a fiction of the future. So if we don't improve space technology every year, we're never going to get there. And so the goal of SpaceX is to make as much improvement as possible and hopefully we'll see people land on Mars in our lifetime.
33:10Kara SwisherI have to ask you, that would be really great. I just have to ask you, have you literally looked into, or had someone look into, or are they still looking into for you whether you could do warp drive?
33:21Kara SwisherI mean, really, does that crush?
33:23Elon MuskWell, you know, there actually seems to be, oddly enough, some breakthrough on the whole warp drive thing because you can't exceed the speed of light. But technically it is possible, theoretically possible, to warp space itself so that even in your local space time continuum, you're not traveling faster than speed of light, but you're warping space such that space is moving.
33:47Kara SwisherAnd that's what.
33:48Walt MossbergOk, got that.
33:49Kara SwisherIs that. Now wait a minute, I actually kind
33:54Walt Mossbergof understand that's because you like Star Trek. He goes to the Star Trek Museum in Las Vegas. So let's not.
33:59Kara SwisherIs, is that like in the fourth quarter or next year?
34:07Elon MuskWell, I'm not sure if warp drives ultimately, I mean, warp drive may or May not come to come to fruition, but I think if we at least have a base on Mars that's going to create a forcing function for the improvement of space transport technology and gives us the best chance of ever achieving something like a drive that would enable travel easily.
34:27Walt MossbergYeah, but listen, Scotty Spock, let's talk about now. Okay. All right. Right. In a second.
34:32Audience MemberSure.
34:33Walt MossbergGood movie, by the way.
34:34Elon MuskYeah, it's recommended. Seeing the new Star Trek, terrific movie, by the way.
34:38Walt MossbergLarry Elson's son produced it, which is, oddly enough, what's happening now, what's available now for us. Not warp drive, not transporter beams or whatever.
34:49Elon MuskThe big breakthrough that's needed in rocketry is to achieve a fully and rapidly reusable rocket. And it's important to have those, those are important qualifications because if you think of any other mode of transport, like a plane or bike, car, anything, horse, they are reusable.
35:10Elon MuskYeah. And they're reusable quickly and, you know, fairly completely apart from maintenance schedules.
35:16Kara SwisherAnd the only one we have the United States at least built, or anybody built, I think, was the shuttle. And that was usable, but not quickly.
35:25Elon MuskAnd it was only partly reusable. So the main tank, the big orange thing, was not reusable. It was guaranteed to be expendable every time. It wasn't just a tank.
35:35Elon MuskThat big orange thing was actually a primary airframe to which the orbiter of the plane pot and the side boosters attached. So even in the best case scenario, it would not have been reusable in a substantial way.
35:47Elon MuskAnd then it took an army of 10,000 people nine months to refurbish a shuttle for flight, which is obviously not rapidly reusable. So in order to have a breakthrough, you have to have a fully and rapidly reusable rocket.
36:03Elon MuskAnd we're making progress in that direction. And I'm hopeful that sometime in the next couple of years we'll be able to. To achieve full and rapid reusability of the first stage, which is about 3/4 of the cost of the rocket.
36:16Elon MuskAnd then with a future design architecture, achieve full reusability.
36:21Kara SwisherAnd how long does it take to get to Mars with whatever the technologies
36:26Elon Muskyou plan with relatively sort of standard rockets, a low energy trajectory would be about six months. Well, you can compress it down to three months without too much trouble.
36:35Kara SwisherAnd you're not. And there's no. You're talking about a humans on this rocket going to Mars. So are there any dangers? I have read that there are radiation, dangerous.
36:48Elon MuskWhat could possibly go wrong? That's Ridiculous.
36:50Audience MemberCome on.
36:56Walt MossbergI don't even like to drive with you. I mean.
37:02Elon MuskYeah, vice versa by the way. Yeah. So it's, there's probably some challenges along the way, but I think it's possible, I think we can make it work this way.
37:15Elon MuskThere's no, we're not violating any laws of physics. It's difficult but achievable and I think we should really try our hardest to make it happen.
37:27Kara SwisherAnd why Mars?
37:28Elon MuskWell, Mars is the only place where we could really create a self sustaining civilization on a planet scale.
37:35Walt MossbergCan you explain these people who don't know, like myself?
37:39Elon MuskOkay, well, so if you look at the various planets we've got, Mercury's too close to the sun. Venus is hot. Yeah. I mean the rocks melt on Mercury. So that's a no.
37:54Elon MuskYeah, toasty. And then Venus is still pretty, pretty hot. It's several hundred degrees and it's high and the atmosphere is high pressure and it's acidic. So it's a high pressure hot acid bath.
38:07Kara SwisherWe actually thought of having a decompress on Venus. It's not going to work.
38:11Elon MuskYeah. Say that Venus would be very challenging. And then Mars obviously is on the other side of Earth and it's colder than Earth. But the, the temperature in Mars actually gets above room temperature on Earth on a hot day in the summer.
38:29Elon MuskAnd you could warm Mars up over time with greenhouse gases and kind of the opposite of what we're doing on Earth. This is great to export our greenhouse
38:38Walt Mossberggases and we're good at that. You can bring all the gas, you
38:40Kara Swishercan bring all the GM cars there.
38:43Elon MuskYeah.
38:49Elon MuskMars's atmosphere is primarily carbon dioxide, which shows you how long. I mean it's been there for 4 billion years. Shows you how long carbon dioxide lasts. It hangs around for a while.
38:56Kara SwisherAlso slowly it warms up. A planet.
38:58Elon MuskYeah. Well, it's quite a thin carbon dioxide atmosphere. But if you were to. But we could bulk it up. We could bulk it up.
39:04Audience MemberWe have practice.
39:04Kara SwisherWe know how to do that.
39:05Elon MuskExactly. So Mars is, you know, is a sort of, it's a fixer upper of a planet. But we could, we could make it work. We could make it work.
39:15Walt MossbergEmpty. Do you want to go there yourself? I know you said you didn't want to die in a rocket accident. You'd rather just die.
39:24Elon MuskDo you want to die on impact? Yeah.
39:25Audience MemberRight.
39:25Walt MossbergYou want to die on impact but you don't mind dying there.
39:28Elon MuskYeah, I think, I mean, all things considered, I mean if one's going to die anywhere, it'd be kind of cool to die on Mars.
39:37Walt MossbergI'm going with Hawaii, but okay,
39:40Audience Memberso
39:41Elon MuskI think that, yeah, that'll be. But I just think the things that kind of get me going are. I think it's just really important to me and I think to probably a lot of people in this room, that if you look to the future, that it's an inspiring, exciting thing, that the future is better than the present or at least has a good chance of being better than the present.
40:00Elon MuskAnd I think that's the main driver for me it's like, okay, will we have, will we be a space ranked civilization or will we be confined to Earth? I think it would be so much better if it was the former.
40:14Walt MossbergRight now. Your rockets though are for doing payloads and it's a business. You're trying to make a business out of it too, correct?
40:19Elon MuskI mean, yeah, yeah. So we've got to keep SpaceX, we've got to pay the bills.
40:23Walt MossbergRight.
40:24Elon MuskAnd so the, what SpaceX does is launch satellites for commercial customers and do space station servicing for NASA. So. So we won the primary contract to do space station transporter cargo to and from the space station.
40:40Elon MuskIn fact, we're the only craft capable of bringing significant cargo back from the space station.
40:46Kara SwisherBut it's not readily reusable yet.
40:49Elon MuskCorrect, it's not.
40:50Kara SwisherSo you're in. Your breakthrough in a sense has been to do what NASA and the Soviets used to do, or still do to some extent. The Soviets still do it, but to do it in a.
41:01Audience MemberThrough.
41:02Kara SwisherVia a private company.
41:03Elon MuskYeah. I'd say our breakthroughs thus far on the SpaceX side are incremental in nature, not revolutionary, and the aspiration is to have a revolutionary breakthrough. I should point out that the cost of the propellant in the rocket is only about 0.3% of the cost of the vehicle.
41:22Elon MuskSo it's maybe a couple hundred thousand dollars to refuel the rocket and whereas costs over $60 million and which makes sense if you think about planes like how much does a plane cost versus refueling a plane?
41:38Elon MuskBig difference. Nobody would be flying if you had to buy a new plane every flight. No, no.
41:45Kara SwisherAlthough United should.
41:47Audience MemberRight?
41:47Elon MuskExactly.
41:48Kara SwisherThere's come a time when some of those United planes.
41:51Elon MuskYeah, there's some of them belonging to tooth.
41:53Walt MossbergWhen you're thinking of these things, you're doing a lot of stuff. You're kind of a busy fellow. Who are your heroes? What inspired you to be this?
42:03Elon MuskSure. Well, I think generally a lot of people that I admire in history, certainly scientists and engineers and technologists in general, obviously I'm a big admirer of Tesla, Nikola Tesla and many others.
42:22Elon MuskI mean all the obvious people you can imagine. I like Tesla, Edison too. Although people sometimes are surprised to hear that since we have a company called Tesla and you know, Einstein, Newton, just like Darwin, a big fan of Ben Franklin.
42:42Elon MuskI think he's just an awesome example of a great human being in his. You know. So I'd say the people like that
42:49Kara Swisherand are there obviously you were one of the pioneers of an important Internet company, PayPal. Did anybody else in the kind of IT area inspire you? I mean obviously all those people you mentioned are really great geniuses, but they were kind of well before the.
43:10Kara SwisherThere were more scientists than they and. And inventors. Well before the IT era. Or is it just too early in the IT era?
43:17Elon MuskNo, absolutely. I admire anyone who's worked hard to accomplish some great thing. I mean it's worthy of admiration. So, you know, obviously it's quite hard not to admire someone like Steve Jobs, you know, Bill Gates or you know, in sort of present day.
43:37Elon MuskBig fan of Larry Page, good friend of mine. What him and Sergey have done there is pretty awesome.
43:46Kara SwisherAnd then probably many, many journalists.
43:50Elon MuskI'm not against journalists, honestly. No, I know.
43:53Kara SwisherLook, you're here.
43:53Elon MuskYeah, exactly.
43:55Walt MossbergBut when you talk about the Internet of today, how do you look at it? You were in a very clear part of the Internet that was. I remember you were Mr.
44:03Walt MossbergWeb 1.0.
44:04Audience MemberRight.
44:05Walt MossbergAnd you did in fact pose in front of cars. I remember there was some car picture that you. Porsche, Fiat.
44:10Elon MuskThis is a McLaren F1, right, exactly.
44:13Kara SwisherSo you weren't close?
44:14Elon MuskNo, well, yeah, I don't know what
44:17Audience Memberthat is
44:19Elon Muskand actually I'll tell you too. I actually do haven't told anyone in a while, but I do actually still own one gasoline car which is a 67 Series 1 E type Jag.
44:35Walt MossbergAh, I don't know which. Great.
44:36Kara SwisherI know exactly what it is. Some of us know I have a Mazda 5.
44:41Walt MossbergI like it a lot.
44:43Elon MuskBut when I was sort of in college there were. I was reading about the McLaren F1 and it's just an ensuring work of art. I mean it's just really, really done right.
44:53Elon MuskAnd so I thought if I ever made enough money that I'd buy the McLaren F1. So I actually living in an apartment in Palo Alto that cost significantly less than the car.
45:05Walt MossbergI remember that picture, yeah.
45:07Elon MuskAnd it was either upgrade to a house or buy the car. And I bought the car.
45:15Kara SwisherWere you married at the time?
45:16Elon MuskI was actually, yeah.
45:17Walt MossbergAnd you posed in front of it. It was quite a symbol at the time, I remember.
45:20Elon MuskYeah, you know. Yeah, exactly. I mean, I wasn't really. It probably wasn't the best idea, but there was. In fact, it was kind of funny. It was this show which is like.
45:31Elon MuskIf there was ever sort of a show on Hubris, it would probably be. It was called Silicon Valley Gold Rush, and it was literally filmed in 99, you know, 1999.
45:42Elon MuskAnd so they fooled me, getting the McLaren and a number of other people as well. Fortunately, PayPal worked out, otherwise it would have been extremely embarrassing.
45:54Walt MossbergRight. Did you go like, ooh, I got one or something?
45:56Elon MuskNo, I didn't do that, but I was pretty excited about getting it.
45:59Walt MossbergSo why. When you look at the Internet of today, we're going to get to questions, since there's lots of questions from the audience, I'm sure. What do you think of the rest of the space, the photo sharing?
46:08Walt MossbergIs it meaningless because given you're going to Mars and everything, or is it.
46:12Kara SwisherI mean, people are like, Vine, I can, you know, do a selfie which is animated. A lot of people, you know, are kind of excited, but I love them.
46:22Kara SwisherKara did some great ones.
46:23Elon MuskAbsolutely.
46:23Kara SwisherBut it's not going to. It's not making a car, going to planetary habitats. It's like a different thing, you know, or even being able to drive from New York to LA on electric power.
46:36Kara SwisherOn electric power.
46:38Walt MossbergWhat do you think of when you look at the Internet right now, about what's developing and what's happening?
46:42Elon MuskWell, I mean, I think. Actually, I'm not dismissive of things like photo sharing apps and that kind of thing. I mean, the. I mean, there's a lot of things where it provides, say, a small amount of value to a lot of people, and that sums up to some large value.
46:59Elon MuskAnd that's still good. People are able to share photos of their friends and family in a better way. I think that makes their lives better. And if that puts a high value on the company, so be it.
47:11Elon MuskI think that's not that bad. And, I mean, I think we've got an enormously. A lot of talented people, a lot of talented entrepreneurs, venture capitalists and others in the Internet arena.
47:26Elon MuskAnd I think it'd be great if some of those people would actually go to other arenas that could use their talent. I mean, that's the only thing that
47:33Walt MossbergI would say is, well, there is this concept. Someone the other day when I was asking what's going on in Silicon Valley, and he said, very smart guy. He said, you know, there's a lot of big minds chasing small ideas, right?
47:43Walt MossbergAnd I sometimes, you know, the ninth kind of silly little thing, you're like, wow, these are fantastic. And yet, like, everyone's making Twinkies kind
47:53Elon Muskof thing on some level. And so, yeah, I think this probably, I mean, I'd recommend that people consider arenas outside of the Internet because there's a lot of, like I said, there's a lot of industries that could use that entrepreneurial talent and the skills that people have learned in creating companies.
48:16Elon MuskAnd, you know, then there's actually a lot of opportunity in these industries, particularly ones where they've been kind of dominated by an oligopolistic set of companies for a long time.
48:30Elon MuskOligopolies are not. Or duopolies and monopolies are not great at innovation. Innovation comes from new entrants to an arena. And so when an industry has had the absence of new entrants, it tends to have very limited innovation, which also means that if you do get a break on through the other side, then there is a lot of opportunity for a company that's created there.
48:56Walt MossbergSo what are you doing next? Because you're, you know, we're kind of bored with these last two.
49:01Elon MuskWell, I think I'll be occupied with Tesla and SpaceX for a long time.
49:03Walt MossbergBut is there one other arena you'd like?
49:05Kara SwisherDon't you have a solar thing?
49:06Elon MuskSolar, yeah, in fact. But I should clarify that. A lot of times people ascribe the success of SolarCity to me, but I really should be ascribed to my cousins, the co founders, Leonard and Peter Rive.
49:19Elon MuskI mean, I provide some strategic advice and I suggested that they do a company in the solar arena, but they deserve the vast majority of the credit for that outcome, and it certainly shouldn't be ascribed to me.
49:33Kara SwisherOkay, all right, well, we're going to take some questions.
49:36Walt MossbergAnd by the way, Elon said to me he wasn't. Why would we want him here? He's not a technologist, just so you know. Well, no, and I just was like, I don't know what you're talking about.
49:43Elon MuskWell, I'm a technologist, but I'm not an Internet. So I'm not like digital. That's the thing. It's like, I was like, okay, all things digital.
49:48Kara SwisherWell, there's nothing digital. I'm not exactly digital, but there's nothing digital in the Tesla.
49:52Elon MuskThere are digital things, but it's. Yeah, it doesn't say all things digital and physical.
50:02Walt MossbergAll right, let's get to the question
50:03Elon MuskShervin, which is going to be called All Things.
50:05Walt MossbergAll Things. That's our new name. We need one.
50:08Kara SwisherOh, you want to start over there? Okay.
50:09Audience MemberHi, Shervin Pishavar from Sherpa.
50:11Kara SwisherHi, Elon.
50:13Elon MuskHey, Shervin.
50:14Audience MemberI've been coming here for many years, and all of us who have been here for many years, we're always inspired to see Steve Jobs here. And obviously we all miss him deeply.
50:22Audience MemberBut somehow your presence here and your inspiration really eases that pain. So thank you for coming.
50:28Elon MuskOh, wow.
50:35Audience MemberElon, there is one idea you have that we've discussed before, which is hyperloop. I would love for you to tell this audience what that is and how it could change our world.
50:46Audience MemberAgain. Thank you.
50:48Elon MuskYeah, I would actually love to answer that question, but if I do, it will. That will be the news tomorrow, whereas I need to do the Tesla news.
51:00Walt MossbergYou did that.
51:02Elon MuskYeah. So, yeah, I think probably I'll be able to talk about the hyperloop idea in, you know, pretty soon. There's a Tesla announcement. We've got next month or so around June 20th or so.
51:20Elon MuskAnd I think,
51:25Elon MuskI think at some point after that that should, hopefully that will be a good time to talk about the hyperloop idea. But for those that aren't aware, the basic thought is, is there a better way to travel quickly from, say, downtown LA to downtown San Francisco or LA to San Francisco that's better than the high speed rail that's being proposed?
51:52Elon MuskBecause the high speed rail, that's what originally got me to think about, is there some better way to do it? Because the high speed rail that's being proposed would actually be the slowest bullet train in the world and the most expensive per mile in the world, which is.
52:04Elon MuskThese are not the superlatives we're looking for.
52:06Kara SwisherKind of like our Internet here.
52:07Elon MuskYeah, but it's, you know, I think this, it's a little depressing to sort of have something that's like the slowest bullet train in the world in California at enormous cost.
52:22Elon MuskAnd isn't there something better that we
52:23Kara Swishercould come up with and that's something better as the hyperloop?
52:26Elon MuskWell, I think so, probably, but I
52:27Kara Swisherdon't know what that is.
52:28Elon MuskYeah.
52:31Kara SwisherBut I want to ride on it.
52:32Elon MuskYeah. I think even if I'm sort of wrong about the economic assumptions behind the hyperloop, it would still be a really fun ride, even if only one of it ever existed.
52:46Elon MuskIt would be a really fun ride.
52:47Walt MossbergI know what it is.
52:50Elon MuskIt's in train, a plane, an automobile, it's transporter machine. It's a cross between a Concorde and a rail gun.
53:01Kara SwisherA Concorde and a railgun. Okay, but you're not.
53:05Audience MemberYou.
53:05Elon MuskYou don't want to throw something else in there just to make it sound even more. Even more bizarre. It's across between a Concorde, a rail gun, and an air hockey table.
53:19Elon MuskBut if they did a freeway and had a baby, somehow you wouldn't want
53:23Kara Swisherto go a little bit beyond that.
53:25Walt MossbergOh, my God. Okay, let's go.
53:29Audience MemberLet's go.
53:31Walt MossbergSan Francisco is in.
53:32Elon MuskYeah. Okay.
53:33Walt MossbergThree way and a baby.
53:34Audience MemberWe love it.
53:34Kara SwisherEsther. Esther, thank you.
53:35Walt MossbergAnd Max will help since you're feeling so loquacious to me.
53:40Elon MuskOkay.
53:40Walt MossbergWhen are you planning to take the first people up into orbit?
53:43Audience MemberWhether it's the space station or Bigelow
53:45Walt Mossbergor whatever she wants to go. Yeah, absolutely.
53:49Elon MuskWell, we're actually. We're working on. Working on version two of our Dragon spacecraft and in partnership with NASA. So this is NASA. NASA is our biggest customer, although we also expect to transport private citizens, and we think we'll probably see the first flights of people in two to three years.
54:12Audience MemberThank you. Bye.
54:13Walt MossbergNice knowing.
54:16Audience MemberNo, no, I'm retiring on Mars, but not yet.
54:19Walt MossbergOkay.
54:19Audience MemberYes, over here, Allison Sheridan from Raytheon, and I am behind the camera. Now I know why everybody's been saying that, looking right to the camera. Thanks for your presence at all things to you.
54:28Audience MemberA couple of years ago, I did get a chance to drive the Tesla Roadster.
54:31Walt MossbergThat was so much fun.
54:33Audience MemberI scared the guy, though. He got a little nervous. But what I actually wanted to ask you about was we've talked a lot here about the importance of STEM education and trying to encourage that.
54:41Audience MemberAnd it's been suggested that part of our strategy really should be immigrant STEM type people. And I'm just guessing that with your background, maybe you have some interesting perspective on that.
54:50Walt MossbergOh, we forgot that question.
54:51Kara SwisherYeah.
54:52Elon MuskOh, you're welcome. Great question, Zuckerberg. Yeah, I do think we should be. I mean, if there's some really talented grad students at American colleges, it's crazy to send them home or force them to go home in a lot of cases.
55:08Elon MuskSo I think we should have some reform of immigration policy that actually has us arguably recruiting. I mean, you should think of, like, if this was a company, if the United States was a company, you'd be working hard to recruit top people, and you certainly wouldn't be expelling them.
55:26Elon MuskThat would be. That would be crazy. So we should definitely have some reform on that front. And it does inured to the benefit of other countries. But we should try to keep, have them stay here, I think.
55:40Elon MuskBut with respect to STEM in general, I mean, to the degree that there are exciting technology projects that kids in school can read about and say, okay, I'd like to work on that or be part of that, that is what draws people into science and technology.
56:00Elon MuskAnd the biggest thing I think in history that is on that front was the Apollo program. I think there's probably not been any single thing that's been more powerful in drawing kids in because they're like, wow, we sent something in.
56:15Elon MuskI want to help make that happen and go beyond that. So I think it's really important to have those projects that kids can read about and want to be part of in school and that will really draw them.
56:29Kara SwisherSince we just touched on immigration, can you explain what happened with the political lobbying effort started by Mark Zuckerberg that you were, you were supporter of, but then you withdrew along with some others?
56:44Elon MuskWhat was that all about? Yeah, so initially when I was, you know, I agreed to be part of Forward US because I do believe immigration reform, I think we need to, we've got some really antiquated laws, change them.
57:04Elon MuskAnd there are some other things that also need to be on the agenda. So I thought, okay, I'll support that. But I think the methods that were employed, I mean, it was a little too much of the sort of Kissinger esque realpolitik, you know, and that wasn't, I mean, I think we should try to make things happen for like the right reason and we shouldn't give in to the cynicism of politics.
57:37Elon MuskI mean, we should be, we should fight the cynicism. And if we don't, if we do anything to encourage that, then we'll get the political system that we deserve.
57:49Kara SwisherOkay,
57:53Audience MemberI think maybe Dan, Dan Simon with cnn. Elon, given the runaway success and reviews of the Model S, you have to believe that the other carmakers are going to be gunning for you.
58:04Audience MemberSo I'm wondering how the company is going to keep its competitive edge because you know that success can be a fleeting moment. Also, when do you think that electric vehicles will overtake gasoline vehicles?
58:16Audience MemberAnd finally wondering if you have a message for the nation's oil companies.
58:20Elon MuskSure. Well, I really hope that the large car companies make a concerted effort to create electric vehicles. And ultimately, if Tesla makes competitive electric cars, then we'll deserve to be around.
58:35Elon MuskAnd if we don't, then we don't deserve to be around. I Mean, you know, I'm optimistic that we'll be able to make good products. And so far from being concerned about other car companies coming in, we're actually doing our best to convince them to make electric cars and in fact to make power trains for them, you know, where they will allow us to do so.
58:57Elon MuskSo I hope they look at the success the Model S and that encourages them to make a big move into electric cars. And as for the oil companies, you know, the tricky thing is the way the system is set up because we have an unpriced externality.
59:17Elon MuskWe have this tragedy of the commons problem with the CO2 capacity of the oceans and atmosphere. The incentive structure is such that the oil companies have. It's hard to ask, ask the CEO of an oil company to act against their best interests.
59:35Elon MuskThat's the thing. In fact, if they do, they might get fired by their shareholders. So the right thing for us to do is to change the rules of the game so that it incents the right behavior.
59:48Elon MuskAnd that's why I'm a big believer of a carbon tax is the right way to go. And we don't even have to necessarily change the amount of money that, that we collect from the tax base.
1:00:02Elon MuskBut I do think it's sensible to disproportionately tax things that at least have a likelihood of being bad. So just as we on a personal level will tax tobacco and alcohol and tobacco particularly is bad, and that's a well established fact, we should disproportionately tax CO2 emissions and then I think the right behavior will occur.
1:00:29Elon MuskSo I mean, I have a hard time condemning the oil and gas companies because the current system incents them to do bad behavior.
1:00:47Audience MemberThat tax gets passed along though to consumers and ultimately hurts the economy.
1:00:53Elon MuskNo, see, if the amount of revenue being generated is the same, it's not going to, you know, we need to collect a certain amount of money to pay for the federal government.
1:01:06Elon MuskAnd how we collect that is, you know, you collect that in a wide range of ways. But effectively what we're doing is we're saying a portion of somebody's labor has to go to federal government activities.
1:01:22Elon MuskAnd it doesn't, you know, it's not going to negatively affect the economy really how we collect that money, people may think it has negative effect, but it really doesn't.
1:01:34Elon MuskIt's the same. It's a certain amount of money collected to pay for the federal government. It's like I said, we don't actually need to change the amount of money raised.
1:01:43Elon MuskBut we need to weighted towards the things that are more likely to be bad than things that are more likely to be good,
1:01:52Audience MemberI guess.
1:01:53Elon MuskI mean, where I have an issue with oil and gas guys is when they sometimes engage in nefarious tactics or things that are sort of somewhat insidious, like funding academic studies that people can then point to as though they have some credibility and it's some prominent professor somewhere.
1:02:17Elon MuskBut that person has been paid off by the oil industry to write that study. So that kind of thing obviously should be condemned in the strongest words. And I'd recommend people read a book called Merchants of Doubt that actually spells it out in detail how some of these things are going on.
1:02:41Elon MuskWhere I mean, oil and gas industry is. All they need to do is to create doubt, and that's what they've done. In fact, they've actually employed a lot of individuals and firms that were employed by the tobacco industry, like literally the same people.
1:02:58Elon MuskSurprised that some of these people are still around because they're like, you know, they're quite old, but in some cases, literally the same people have been employed by the oil and gas industry.
1:03:10Kara SwisherCan we get to this? Thanks. We only have a couple more questions.
1:03:15Audience MemberHi, Jared from Scribd, thank you so much for coming. Elon, My question is about SpaceX. So even without a fully and rapidly reusable rocket, you've still managed to reduce the cost to orbit by an order of magnitude or more, just with more incremental improvements.
1:03:36Audience MemberSo firstly, at what point did you realize that such an opportunity existed in the space field? And secondly, are there other parallel opportunities and other areas that you wish somebody else would chase, even if you don't personally have time to do them all?
1:03:53Elon MuskSure. So when I started SpaceX, it was actually, I thought the most likely outcome was that we would fail. In fact, that was really very likely that SpaceX would fail.
1:04:08Elon MuskSo it wasn't really with expectation of success that I started the company, obviously. But what gave me a clue that we could make a significant breakthrough was looking at the cost of a rocket.
1:04:21Elon MuskAnd instead of looking at it with reference to what other rockets had cost in the past, I said, okay, well what is a rocket made of? What are the material constituents?
1:04:32Elon MuskWhat metals? Carbon, fiber? What are the various materials that constitute a rocket? And if you had a pile of those materials arrayed before you and you could wave magic wand, what would that rocket cost to build?
1:04:44Elon MuskAnd that is a remarkably small number. It was maybe a few percent or 1 or 2% of what rockets actually cost. So clearly people were doing something silly in how they were putting those materials together.
1:05:00Elon MuskAnd so just by eliminating those sort of foolish things, we were able to make a rocket for much less. And then it wasn't obvious to me that one could achieve full and rapid reusability because Earth's gravity is right on the cusp of where that's possible or not possible.
1:05:23Elon MuskIn order to achieve that, really, everything has got to be done super, super well, every aspect of the vehicle. So it was only maybe two or three years ago, or maybe three years ago that I thought it was actually achievable, and now I'm fairly certain it's achievable.
1:05:41Elon MuskBut there's still a long way to go between here and there. And as mentioned before, we've not yet recovered a single rocket stage. So we have a long way to go.
1:05:51Kara SwisherOkay, I think this has to be the last question.
1:05:54Audience MemberYeah. Hi, Alon. Greg Tarr from Cross Pacific Capital up in Palo Alto. Question for you. I used to work for Toyota's US headquarters, and when we, in 1990 scaled up the Lexus dealership network, it was pretty tough.
1:06:07Audience MemberAnd I wanted to get an understanding of what kind of innovation you're going to bring in terms of the service area. It generally takes 300 dealerships to support about 100,000 units.
1:06:17Audience MemberAnd you're doing a tremendous job, which I admire, and I want to understand what your plans are, because eventually the middle part of the country will begin to understand the revolution happening on the east and West Coast.
1:06:29Audience MemberHow will you make it happen in the dealership network and service?
1:06:34Elon MuskYeah, well, service, in fact, for the last three or four months has been my main focus at Tesla. And it was three or four months ago. It was. Our service was okay and in some cases quite, quite bad.
1:06:51Walt MossbergIn particular, someone asked me about that, the weird service of Tesla, but go ahead.
1:06:54Elon MuskYeah, I'd say we had some pretty nightmarish service situations. Probably in the January, February time frame, things have gotten steadily better. And like, for example, LA was a problem for a huge.
1:07:08Elon MuskFor a really long time because we were supposed to have three service centers open and permits were delayed on two of them. So we were operating at one third capacity.
1:07:16Elon MuskSo as long as your Model S didn't break down, you had an awesome experience. If it broke down, it was brutal. So now we've got all three open, things are a lot better.
1:07:27Elon MuskBut it is going to take enormous amount of work to scale service across the country and then internationally. We start delivering in Europe in July. So, yeah, I don't know if we've got any brilliant insights that you probably know all the things that I would say.
1:07:44Elon MuskBut you've got to have really good diagnostics tools. And we do have an advantage in that the car has so much intelligence in it, it can do a lot of self diagnostics and we can query, you know, what parts need to be fixed on the car before it even comes in so that, so we can be more efficient in our service.
1:08:06Elon MuskAnd then something we announced recently was that we're building this fleet and, or largely have built at this point, this fleet of service loaners so that when, if your car breaks down, what we'll do is.
1:08:19Elon MuskAnd we also have valet service. So if your car breaks down or you need service, we will go to wherever your car is and replace it with one of our top of the line cars.
1:08:32Elon MuskSo our service learners are not sort of the standard cars, they're actually the top of the line cars. And so we'll just valet a service loan into wherever you are, pick your car up, take it, get serviced and then return your car when it's done.
1:08:46Elon MuskSo the experience should be really seamless and you should really feel like you got actually an even better car than the one that you had serviced for some period of time.
1:09:02Elon MuskAnd it was no interruption to your life. I mean, that's the most important thing. Lexus did this to some degree. I'm not sure if Lexus does the full valet thing or not.
1:09:09Elon MuskIt certainly did the service learner program, which was done really well actually.
1:09:15Kara SwisherIlan, thank you.
1:09:16Walt MossbergThank you so much.