Tesla's Chair Says Only Musk Can Lead the Company

28:34And it's no different at Tesla. We have been focused as a board on Elon Security for many years now. He's been very public and very much out there. And so, it is something that we take very seriously. He takes it very seriously as well. And so, again, from a board perspective, it is something that we've discussed at length. Robin, there are a number of other proposals in the proxy. One is a shareholder initiated proposal for Tesla to invest in XAI. It is non-binding. The board doesn't take a position, but how does the board think about it? For example, if investors would say, no, We don't want Tesla to make that investment.

29:17Would the board still look to pursue it independently? So, clearly, there are 16 proposals overall in the proxy. I know we've spent quite a bit of time on one, important one on compensation, but the XAI proposal is a shareholder proposal that has been put into the board. We value our shareholders' input. And the reason why we have not put a recommendation is we want to hear from shareholders in terms of what their views are as to whether or not we should make an investment in XAI. One thing I will say at the outset is there's a lot of misunderstanding of AI in the marketplace. It is not one thing, okay?

30:01It is a range of technologies. What Tesla is doing today with AI is quite different to what XAI does. XAI is working on fundamental areas in AI, but it's also working on large language models. That's not what Tesla's doing. As you can see behind me with Optimus, we're taking real world application of AI and putting it into physical products to actually empower those products to do things. So with with Optimus, it's very visual. You can see what he does in terms of visualising things and then actually doing things. And the same with the vehicles. So, what we're doing with AI within FSD is actually taking that visual data and using that to drive the car.

30:56And so, that's quite different to what an ex-AI does. Robin, a very quick question, and then we will end on the final proposal for the compensation package. This week, Bloomberg reported an investigation about some fatal incidents where passengers or those inside the vehicle had difficulty using the manual release. Now, as you know, I drive a Tesla vehicle, you drive a Tesla vehicle. All I want to ask is, is the board aware of that reporting? And will it raise that issue with Elon? And is Tesla looking at the design of the door manual override? So I can tell you that the board takes very seriously any safety-related reporting or any incidents of any type globally in terms of what we look at.

31:41But in the Tesla, there is a manual override already. And in fact, it's been reported that you can actually manually open the door if there is a power event or anything like that. So, safety is our number one factor in terms of what we're doing. And Tesla ranks very highly on safety. Very highly. It's also why we're pursuing FSD because just in North America, there are 50 ,000 deaths on the road. That's 50 ,000 too many. And we know with the data that we have for FSD that it's actually safer than a human driver because of those 50 ,000, 94 % are human error. So if you can eliminate 5 % of that, that's a lot of deaths that you can avoid.

32:29And so, again, safety is one of our key priorities in any aspect of the business. Let's end on this unprecedented proposal. And I'm going to ask you this. What would happen to Tesla if Elon Musk left tomorrow, you know, in order to try and help shareholders understand the board's motive here in keeping him? But there was one specific question from our audience, which I really appreciated. Why does Elon need to be CEO? Could he not take on a more technical role? Well, that is contemplated in the package, just like in the 2018 package. We want his service at the company. He can be the CEO, but he can also be in another role, whether it's chief product officer or that type of thing.

33:17We've contemplated that before. But to me, I think the really key thing is that shareholders get to vote on the future of the company, not just on a compensation package. The compensation package is the instantiation of the goals and the super ambitious goals that we have as a company. And so I think with this proposal, it's really up to shareholders what the future of Tesla looks like. Robin Denholm, chair of Tesla's board. There is a key shareholder vote in November on what is, we've said it, an unprecedented proposal on a compensation package for Elon Musk set against very high bar deliverables.

34:01But what a conversation, Caroline, to inform the understanding of some of those deliverables. Back to you, New York. An ambitious plan to be the most valuable company in history. What a wonderful chance to be there with Robin Denholm. Ed, we leave you. Thank you very much indeed. Let's check in back on these markets because Tesla is having a good day. It is up 5.4%. It's been up yesterday as well, some 6 % when riding high. And remember, a trillion dollar company with the aim of becoming a 2 trillion, at least for the first tranche of that voting and indeed that money going to Elon Musk. But I want to focus in on also what's happening elsewhere in the markets because we are having a strong day for the NASDAQ.

34:41We're having a strong day for Paramount and Warner Brothers. Warner Brothers Discovery now up 15%. It was digest that reporting that Paramount under David Ellison and with the help of his family, one Larry Ellison, might indeed take Warner Brothers Discovery by the whole lot, not even just the areas of the studios and streaming. We're up 15%. Elsewhere in the market, we're looking at Apple delaying the launch of its new iPhone Air in mainland China, citing regulatory approval issues. Let's just get out to blue most global consumer tech managing the editor, Mark Gurman. Look, this seems to be pretty seismic, the fact that they're not going to be selling the Air in China, right now at least.

35:17It's a big deal because if any market was going to be a hot market for the iPhone Air, it is China where they have a lot of fashion-forward consumers who want to whip out the latest and greatest, slimmest iPhone, the newest-looking phone. That's why iPhones sell in China. Remember, they came out with the gold iPhone a decade and change ago because they knew that people in China wanted to buy those types of phones. So this is disappointing in terms of a delay for the iPhone Air in China. And it is a bit of a change because just a few days ago when they introduced the iPhone Air, they said on their website, the pre-orders would begin on September 12th today, and it would go on sale on September 19th.

35:55So something happened in the last few days that led the company to postpone it. Now, eSIM technology is at the very heart of this phone. Physical SIM cards cannot fit in this super slim 5.6 millimeter frame. The problem, eSIM is not really ubiquitous or plentiful in China like it is in the US and many other countries. So initially, when this phone was supposed to go on sale in China next week, it was only to be available on one carrier and not even the country's biggest carrier. That's China Unicom. And even more so, anyone who bought the iPhone Air would have to go to a physical China Unicom retail store, which is a bit of a headache.

36:32So even if it did launch on time, it wouldn't be so smooth. Maybe they're waiting for them to be able to launch and have a smooth release. And maybe they feel like that's the better approach. So we'll see how long this takes. But I'm sure Apple's on the case to get this done quickly. Mark Gurman, always with the breaking. We so appreciate it. Now let's turn to other breaking news on a fundraise. US satellite bus company, especially a spacecraft manufacturer. It's called Apex. It's just raised$200 million in funding, brings the company's valuation to over a billion dollars. I'm pleased to welcome to the show, Ian Cinnamon, is CEO and co-founder of Apex.

37:05And as always, we ask the money, what are you going to be using it for, Ian? We're really using it to expand the factory that you see behind me right here. So what it really comes down to is there's a massive shift in the industry away from building these very expensive, exquisite systems into moving towards what we call proliferated systems. So how are we launching hundreds of satellites into orbit to really supply for constellations, for commercial applications, government applications, and more. And that requires manufacturing satellite platforms at scale. And for us here in what we call Factory One here in Los Angeles at Apex, before this funding round, we were able to produce about 12 satellites per month out of this facility.

37:46And now we're able to up that to about 18. We are continuing to scale that manufacturing, though, because the demand is even far higher than that. Talk to us about that demand. You're providing essential services, basically, to all satellites that need to survive in space. I'm interested, Ian, as to whether that demand glut at the moment is coming from the government, or is it coming more from the private commercial side of things? It's a great question. It's actually coming from both. So the one that, you know, is very out there and we talk about a lot is things like Golden Dome and a lot of the U.S.

38:16defense initiatives that are pushing for getting more and more of these capabilities into space. Space truly is the ultimate high ground. We're in the middle of what we call a new space race right now, where it's the U.S. against our adversaries. And we're not in a position to win unless we increase that manufacturing. So this demand for constellations is very heavily coming from the government side. But we're also seeing it starting to emerge on the commercial side as well. Companies like SpaceX have really pioneered commercial constellations like Starlink and others. And now we're seeing a lot of other companies follow suit.

38:48Even just today, right, the new Apple products went for sale where all of those iPhones are able to connect to satellites, the new Apple Watches connect to satellites, and seeing more and more of those constellation requirements for what we experience every day with consumer electronics, it just continues to grow. I mean, it's interesting, Ian, that there's been a lot of pressure put on Apple CEO Tim Cook to make more in America. You, on your website, when you go there, you're proudly made in the USA, but how much are you reliant on components coming from abroad? How much are you trying to ensure that you're sort of self-sufficient here?

39:21So we did an assessment as soon as the tariffs came out and we said, are we impacted at all? And the impact was pretty much zero. And the reason for that is we really are using U.S. components, but it goes a step further than just U.S. components. Almost everything that we're building, we actually vertically integrate and build in-house here in our facility and then our expansion facility right next door. So by bringing all of that in-house, we really control our own destiny, control the supply chain and are able to ensure that it's not just about building a lot of these satellite platforms, but it's about building a lot of them incredibly quickly.

39:54To control your own destiny, you don't just need the resources in terms of the production side, but you also need the talent, Ian. How easy or hard is that right now? I have to say we are in Los Angeles, which I consider to be one of the aerospace capitals of the world, right? Just down the street is companies like SpaceX or Rocket Lab or the Jet Propulsion Laboratory. We have amazing companies around us that we're able to source great talent from. That being said, we always need more people. We are hiring dozens and soon to be hundreds of roles. We are looking to bring on a lot more people. And frankly, there's not that many people with the skill sets that are actually required.

40:31So we are very much looking forward to seeing kind of an increased attention towards aerospace and a lot of students studying this in order for them to come eventually join us here at APEX. Join you, help serve clients that include Andrew Hill, that include NASA. You've talked about how much everyone focuses on the defense and the government side of things, but there is this real spurring coming from private sector. But if you could ask the U.S. government for one thing right now, Ian, because they are focused on your area, what would it be? I would say it is rethinking how we do acquisition. So traditionally on the government side of things, it's been working the same way for decades, which is the government will say, I need some capability.

41:13And then they go out and they pay people to go build a specific product for those capabilities. What we do here at Apex is very different. We take our investor capital, like this$200 million round led by Achele and Tom at Intralagos. We take that capital and we invest that into actually building products before the government ever says that they need it. And then once the government realizes they need it, we're able to supply it to them in a matter of days or weeks or months instead of having to wait for years. It also costs way less on the taxpayers by us getting ahead of it. The problem is not all of government procurement has caught up to that strategy, where they're still putting out requirements, asking for people to make things custom and new.

41:53So our big push is, if I were to ask one thing of the U.S. government, it's focus on commercially available off-the-shelf parts, actual products like we have here at Apex, instead of reinventing the wheel every time. Ian Cinnamon, I mean, just months after racing your Series C, you're on your Series D. Lintelagos, as you say, leading that round. Ian Cinnamon, Apex CEO, live from Los Angeles. We appreciate it. Now coming up, Judy Sweep, CEO of Accenture, is going to be joining us to discuss the pace of AI adoption in the enterprise. So much more than that as well. This is Bloomberg Tech.

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45:20A stat for you. Nearly 85 % of C-suite leaders plan to increase AI spending this year. Even if a recession happens by the end of the year, that's all according to Accenture's latest Pulse of Change survey, giving insights into how talent and technology trends really are shaping and driving change within business. It's the perfect person to discuss it with. Julie Sweet, Accenture CEO. It is wonderful to have you here, Julie, on the show. And it comes at the perfect time because there's been anxiety in the market. MIT reports, for example, making people question the return on AI investment and deployment.

45:53What are you hearing from the C-suite? Well, Caroline, thanks for having me. The number one topic, I've been with five CEOs in the last five days. the number one topic is how do I scale AI? How do I make sure it's embedded in how we operate every day? And that is because there's a huge difference between how we're all using AI every day in our individual lives. That's easy. But AI and how you operate an enterprise is hard, which is, of course, why our clients call us because we're seeing that ROI, whether we're working with an industrial player entire manufacturers that now identifies defects in minutes instead of days, or a consumer goods company where we've saved$20 million in the first year using advanced AI to help access inventory.

46:45The difference between the MIT report and what we're seeing in helping our clients do is they're getting the ROI. Julie, those five CEOs that you've seen in the last five days, busy person, are they seeing this from a long-term perspective? Have they got the patients that perhaps some in the market don't? Absolutely. They understand that AI is going to reinvent every aspect of the enterprise, and that's a long-term game. And so what they're asking me and Accenture to help with is, how do you create, how do you prioritize? And the answer is, you prioritize starting with your business strategy, the readiness of the technology, and your organizational readiness, right?

47:34Where in your organization do you have the confidence that they can embrace? Because embracing AI is about changing the way you work, changing your workforce, and changing the workbench, you know, how you actually get work done. And so absolutely long-term view. And where we're helping is how do you actually execute on that view? I thought some of the statistics were fascinating. The 75 % of C-suite leaders survey saying the pace of AI change is moving faster than actually they can currently prepare their workforce for. I'm going to ask a sensitive one because I'm showing here the Wall Street Journal, a write-up that happened earlier this week, talking about, and it's pretty damning actually, about consultants and saying that basically at the moment, this is such new technology that you can't buy the experience you need, quoting consultants who often had no more expertise on AI than they did internally, struggled to deploy use cases that created real business value.

48:29Can you respond to that, Julie? Because you must have seen that story and been rankled by it. Sure. Look, when you think about the new ways of technology and why Accenture has been successful for the last decades is because we have the ability to reinvent, train people. So we went from 30 people trained in Gen.AI in November 2022 to over 500 ,000 trained today. Companies can't do that. By definition, every new wave of technology has a time for, you know, where you've got to train and retool. And Accenture's core competency is being able to do that at scale to help all of our clients. Our clients can't possibly build all of that expertise that they need without an Accenture to be able to help them scale.

49:22And so it's absolutely core. And think about the way that we've been training, right? We have gone from 40 ,000 to 80 ,000 data and AI professionals in the last three years. That's enormous, right? We've trained over 500 ,000 people. And starting just this month, we're now training all of our over 700 ,000 people in the basics of agentic AI. Our clients come to us to say, we need your help to do this and help us with our talent, which is why we launched our LearnVantage business. So, when a bristle-miles-squibb chief digital officer says there's no more experience within the big four, for example, talking about your rivals than a kid in college, you say, no, not true.

50:07Look at what we're doing. Absolutely. And you can see that, again, in the actual results. So starting with Accenture, right, we've deployed at scale in areas like sales, which we're rewiring. We're using AI to get our proposals faster. We're using it to get to market faster. And then we're taking those solutions to our clients who are adapting them. We're working with a global bank right now where they're now creating, having conversational AI in a single global platform. and they're already seeing a double in double sales that on their mobile app than they had before. But what in order to do that, that wasn't something you did at the edge.

50:50The first thing we had to do was build the foundation with them to actually be able to do that. The reason enterprise AI is hard is because it's not what you experience every day, putting in a question, summarizing your emails, creating new PowerPoints. It's about actually rewiring the way that you do work, your processes, and understanding where you get value. And we're doing that at 2 ,000 different projects at a time. And that's the experience we bring to our clients. And how does it affect your people, your talent pool, your hiring processes at the moment? Are Are you slowing hiring at all at the moment, Julie?

51:32Are you turning to graduates more or less? When you think about the workforce, think about it in three things that you have to do. You have to upskill the people that you have, right? Give them the skills. That's why everybody's being trained in agentic AI in the same way everyone was trained with gen AI. You have to do a talent rotation. There are some people that won't make the journey, right? You have a mismatch in skills and you're not able to train. you know, everyone. And then you also will have efficiencies. So if you keep that framework in upskilling, talent rotation, and efficiencies, that really kind of answers the workforce strategy that not only Accenture has, but all companies need to have.

52:19And certainly your clients like Palantir, NVIDIA, AWS, to name but a few. We thank you so much for taking time amid a very busy circuit of all the other CEOs that you speak to on a daily basis. Julie Sweet, Accenture CEO, wonderful to have some time and expertise with you. Now, coming up, Gemini is about to make its trading debut today. We'll discuss what to expect next. This is Bloomberg Tech.

52:51Gemini making its public debut today. This after a hot week for tech IPOs, to say the very least. Bloomberg's Bailey Lipschelz covers all things IPOs joins us now. Another crypto-related one, another one that's going to pop on the open if indications are right. We're currently seeing$32 is where we're currently indicated having price at$28. Why do people want in on the Winklevoss twins? I think people want in on pretty much anything crypto, as you mentioned. We've seen some pretty strong rallies to start yesterday. Figure a blockchain company rallied pretty sharply and is trading higher again today.

53:24Really betting on the future of crypto. Winklevoss twins with Gemini, not the biggest player, not really one of the biggest players as it comes to exchanges. But the broader pitch is if we are going to go to a future for crypto where it's a bigger part of the financial institutions and bigger part of finance, then investors are really putting money to work because of just that scarcity value. Scarcity value, particularly when before the test it felt like was you need to be profitable. You need to have really shown the bottom line growth, not just top line. Gemini doesn't really have that. No, not at all.

53:56And when you talk to investors like I've been doing, it's really a question of are you just kind of putting money to work in what should be or could be the next exchange again to go. Of the IPO to retail investors. So leaning into that retail trend, this has been something we've been tracking with the last handful of deals. But it really seems like the kind of bet is maybe further away from institutions and betting more on some of those individual investors on a Robinhood or a SoFi to put their money to work and buy and hold this stock and really support it in the aftermarket. Bailey, very quickly, why is it called Space Station?

54:29I don't know. Someone I was talking to kind of assumed it has to do with the whole, I don't know, rockets going to the moon and sending crypto tokens to the moon. I have not gotten a real answer. So if you find an answer, I would love to know. audience give us your real answers or your funny ones too bloomberg's bailey lipshorts it's a joy having you thank you happy weekend meanwhile that does it for this edition of bloomberg tech recapping we've had plenty to talk about this show and just at the very first half we were talking about tesla the future of the pay package for one elon musk we spoke with robin denholm of course the chair board really honing in on the fact that we're seeing a political motivations of Elons that are his.

55:09The Tesla chair telling us the board also takes very seriously any safety incidents within Tesla cars, in particular on the back of that reporting around the Cybertruck from our own Bloomberg News colleagues. And Denholm says the pay package does contemplate different roles for Musk, not just CEO. We're still up 6%. Don't forget to check out our podcast, find it on the terminal as well as online on Apple and Spotify. This is Bloomberg. that.

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