You Can Buy a Car on Amazon? & SpaceX’s Most Powerful Rocket Ready to Launch

0:01Lowe's knows how to get you ready for holiday hosting with up to 35 % off select home decor and get up to 35 % off select major appliances plus members get free delivery delivery delivery delivery basic installation, parts, and a two-year Lowe's protection plan when you spend$2 ,500 or more on select LG major appliances. Valid through 10-1. Member offer excludes Massachusetts, Maryland, Wisconsin, New Jersey, and Florida. Installed by independent contractors. Exclusions apply. See Lowe's.com for more details. Good morning, Brew Daily Show. I'm Neil Freiman. And I'm Kyle Hagee. On today's pod, Amazon is getting into the car buying business.

0:38And F1 is coming to Las Vegas, but it might be the biggest flop since I saw Blue Man Group there in 2004. Neil, it's Friday, November 17th. Let's ride.

0:52Kyle, great to have you back on the show this Friday. You are my favorite substitute since Mr. Waters in fourth grade. So it's any time I can be mentioned with Mr. Waters, that's an accomplishment. So our listeners may not know this, but you have a day job. I do. You work on Morning Brew's education team. And this week, you all just released something that may be interesting to the MBD audience. Yes. And yeah, I don't just sit around waiting to be substituted into the podcast. I do have a full-time job at Morning Brew. We have built what I consider to be the MBD podcast of professional development.

1:23So the best of the best, and that is all access. Essentially, we bundle all of our courses, our content, our live events, community into one product, gives people unlimited access to all of the professional development opportunities we have here at Morning Brew. and we have a special discount for$200 off for MBD listeners. So you can go to learning.morningbrew.com backslash all access for more information there. And if that doesn't sell you, Neil, you also help out on some of the courses as a speaker. I do, yes. I definitely give some talks. It's a really cool program that you guys have built over there.

1:55So you're ready for infomercials. I'm ready to go. Speaking of infomercials, let's give a shout out to our show's sponsor, Brex. Kyle, this is your first Brex ad read, yeah? Yeah, Neil, it is. What do I need to know about them? Okay, so they do so much to help businesses organize their spending. But if I had to sum it up in one sentence, it'd be that Brex can hook your business up with a corporate card, a travel portal, and allow you to pay your bills all in one place. Neil, I didn't hear you mention AI, though. It's 2023. This can't be right. Of course. Brex has all of these AI-powered automations and agents that can help reduce busy work and increase compliance.

2:30Incredible. I'm sold. Good. My work here is done. To learn more, head to brecks.com today.

3:03Everyone learn more at whatsapp.com. Kyle, to start off our show, would you buy a car on Amazon? 100%. Yes, let's do it. Well, Americans will have that opportunity next year after the e-commerce giant announced a deal with Hyundai that will allow those cars to be sold on Amazon beginning next year. It'll be a small number at first, but Amazon hopes to grow its auto biz to include more brands down the line. Right now, online car sales make up just a small fraction of the overall car buying market. Historically, people have wanted to see their car up close, sit in the driver's seat, even take it for a spin before committing to such an expensive purchase.

3:39But COVID may have changed all that. When dealerships were closed, automakers moved more of the car buying process online and they found people do not actually like interacting with humans, especially given the awkward and many times painful dance of buying a car from a dealership. So Amazon looked at this trend and said, hey, we do e-commerce probably better than anyone else. Let's jump on this. Kyle, do you think this move will significantly shake up how Americans buy cars or are consumers still too nervous about one click checkout for a$30 ,000 purchase? I do think that this is a trend that we started to see mainly with EVs and Tesla of kind of going direct to consumer.

4:18So I think this is a really cool move by Amazon. And what I loved with this partnership is their cloud computing unit, AWS and Alexa is going to be integrated into Hyundai when they roll this out. I'm just imagining you're like on a road trip and you're like, Alexa, can you turn my windshield wipers on? And they're like, sorry, you need Amazon Prime to do that. Like, it'll be interesting to see how this integration happens. But as I just mentioned, this is kind of a trend that we've seen with Tesla, with EVs. And there's a stranglehold that a lot of car dealerships have. There's tons of laws around what you can say or what you can't say at dealerships, talking about prices if you're trying to go direct to consumer.

4:57So I think this is really innovative. It will be disruptive. And I'm quite excited to see what happens here. We should mention that because of these laws, the dealership is the end seller here. You're not actually buying the car from Amazon. You're still buying the car from the dealer. But the dealer is just listing the car on Amazon. And for Amazon, it's been slowly trickling into the auto business for a bit now. They sell parts. You can shop for cars there and do comparison shopping on Amazon. You could not actually buy the vehicle from the website. and you will be able to starting with just 15 to 20 Hyundai dealerships next year.

5:31Like you said, I mean, EVs companies have been skirting around the dealerships for a long time now. Tesla started it. Rivian is another EV company that's saying like, I don't, this dealership model is not working for us. There are so many legacy automakers that have these franchise agreements with dealerships that they can't wriggle out of. And that could only create more distance between the innovative EV-first automakers with the ones that already exist, like the Fords and GMs of the world. Ford, during the pandemic, has started to move more of its auto buying process online. But this could still create an even wider gulf between those online-first brands like Tesla and Rivian and the ones that have existed for centuries.

6:10Yeah, Ford has been, their CEO, has been kind of pushing this strategy, Jim Farley. And he's saying that the direct sales approach can save people about$2 ,000. There's a very interesting study where it seems like EVs have not only been moving in this direction, but it's also creating this gap in consumer psychology where EV buyers are much more comfortable buying a car online. There was a study done and essentially customers who completed more than half of the car buying steps online in EV were the most satisfied among all buyers in the study. So it does seem like consumers are warming up to this idea.

6:44Amazon now is going to add fuel to the fire. And I think this is going to be pretty successful. Do you think people will be comfortable just buying something so expensive online without having seen it first? Or are there enough online tools out there where you can kind of go, you can take a virtual tour of the car, you can go inside. Obviously, you can't see how it feels when you sit down in there. And there's nothing kind of, there's nothing that can replace that in the online world. But maybe we're in a, maybe we're in an environment where the dealership experience, I've never had heard someone go to a dealership, buy a car and say, oh, that was so pleasant.

7:16Like, I would love to do that again. That is a really painful experience. It's almost, it's very similar to buying a house in that way, where you're just like, I never want to do that again. There's so many middlemen here. This is very frustrating. I wish I could just buy that online. And so maybe with, you know, more people are buying houses online. Maybe we're getting to the realm of more automakers selling their stuff online. And Amazon, you're right, is just pouring more fuel to the fire. Yeah, it'll be interesting. It'll be like Amazon will say, customers who bought this toilet paper also purchased a 2024 can't just Sonata.

7:47So maybe it'll happen. Neil, let's move on to our next story. And let me just say this. Is there any American city that is hotter right now than Las Vegas? They're acquiring new sports franchises. They might get the next NBA team. They have this giant sphere that looks out of this world. And my dad and his other six-year-old friends still make their annual pilgrimage to the city to bet on football games. And now Formula One is coming to Las Vegas with its inaugural event. and they're investing up to half a billion dollars into this race. It is a big deal, but is it going to live up to the hype?

8:20What's your take, Neil? So far, indications are looking like a pretty significant flop. Ticket prices for the event itself and hotels have plummeted from a few months ago. Originally, the ticket price to get in for the race tomorrow, the Las Vegas Grand Prix, was$1 ,600. Now it's down to$800. The Flamingo Hotel was selling rooms for$899. A reporter just went. They got in for$18 to the Flamingo, a room there. So when you look at this all in its scope, it feels like a massive flop in that Liberty Media, the owner of F1, invested$500 million in this race, thinking that it would be the next great American sporting event.

9:01And it has not panned out. And they might have overstated demand for F1. F1, as we know, got so popular during the pandemic with Netflix's Drive to Survive. and ESPN has this TV deal. So a lot of my friends with nothing much else to do on weekend mornings were tuning into F1 races. And I kind of walked in on them. I was like, guys, I really, this seems like a COVID phenomenon. When things start happening again, I'm not sure you're going to be watching F1, which has historically been dominated internationally and in Europe. And I think we may be seeing that normalization. Yeah, I hope they do pull it off.

9:35Because to me, as someone who's not big into F1, this just seems awesome. They're like shutting down parts of the strip. Yep. So this has gotten so much. There's another problem with this. This has gotten so much local pushback. You have workers at these hotels saying that my commute for months has been two to three times longer. OK, I just interrupted you. No. Well, I think on that point, the the leader of F1 has said this hopes to bring one point seven billion dollars in revenues to the city and to small businesses. So he's hearing the pushback, but he's saying, let us run this and see how it does support the city.

10:08And I also think, as you mentioned, like Monaco used to be this kind of like the signature event of F1. That's like the old money. And they're trying to pivot into America in Vegas because they sense there might be some demand here. And this could be the start of a new era. So I'm hoping it works well. But there have been some hiccups that might stop it. Yeah, this is a 10-year deal. So F1 is going to be in Vegas for many years now. But the problem with this year especially is that there's very little drama in the competition. This guy, Max Verstappen, already clinched the title. So this is basically like an exhibition match.

10:42There's not a lot of drama. There's not a lot of storylines to watch. And even Max Verstappen, when he went to Vegas, gave a press conference, he said this Grand Prix is 99 % show and 1 % sporting event. So when you have the biggest figure in your sport talking trash about your event, that's not a great sign. But overall, I think the momentum for Vegas is only growing. Just yesterday, the MLB owners approved the move from Oakland Athletics to the Las Vegas Athletics. So they're getting a MLB team, the NHL's Golden Knights, which just began there in 2017, just won the Stanley Cup. And you're right.

11:21So they have an NFL team. The only big four sporting event, sporting team, they don't have is an NBA team. And it's just a matter of time before that comes. Vegas is on fire. And the sphere. Sphere is pretty cool. OK, Kyle, remember back to April when SpaceX launched its massive Starship rocket and it exploded spectacularly in midair? Well, the company made a few tweaks and a new version of that rocket is scheduled to blast off tomorrow morning in a second test run. Starship isn't just Elon Musk's pet project. It is the biggest and most powerful rocket ever built, and it's integral to NASA's plans to get back to the moon and Elon's goal of colonizing Mars.

11:58But before all that happens, it needs to prove it cannot explode. Aviation regulators have made SpaceX wait seven long months before they gave the green light for another test. And in the interim, SpaceX has been busy making changes to hopefully result in a clean flight tomorrow. Kyle, there's a lot at stake with this flight. Basically, it'll set the timeline for America's entire space program. Yeah, this has really big implications. And you mentioned how the first launch did not go too well. Well, SpaceX has this concept called rapid spiral development where it's kind of like the move fast and break things approach where they say we're moving faster than anyone.

12:36There are going to be hiccups, but we have a process where we iterate quickly and then we do another launch. That could be classic Elon Musk obfuscation, but it has they've had a lot of success in the past. This is kind of their ultimate mission is to get to Mars. But as you mentioned, this is also a deal with NASA, where we're trying to put a base on the moon prior to China's ambitions to put a base on the moon. So there's a lot at stake here. And Musk said that he thinks the first test flight to Mars could take place within three to four years. Knowing Elon, you add a zero to that. So we're thinking 30 or 40 years here.

13:10But there's a lot at stake. I do hope that this goes well. They've done a lot of improvements for the first launch. And it's kind of exciting. Like, it's making people more excited into space. And I love that. Yeah, what is crazy about the first launch is that they blew up the launch pad in spectacular fashion. This thing, when the Starship left the base, it absolutely could demolish the launch pad and send shrapnel flying miles to local playgrounds and wildlife refuges. So there were these environmental groups saying, you need to figure out what the heck is going on because you just sent rocks flying in a huge blast radius around this place.

13:52So what SpaceX has done is they created what Elon has called a very powerful showerhead that is going to, I don't know, it's rocket science, so I don't know how this works. But it's attempted to preserve the launch pad, which has been, it's kind of one of the biggest points of contention of letting SpaceX do this again. Yeah, I'm going to use that anytime something goes wrong. Don't worry, we fixed it with a giant showerhead. Don't worry. Interesting take, but we'll see if they pulled off. Okay, before we hit the second half of the show, let's take a quick break. Does it ever feel like you're a marketing professional just speaking into the void?

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15:08This is a huge opportunity. This is the battle for the next big idea. This is not play play. We're spending millions of dollars. I'm so excited to embark on this adventure with all of you. Make the best idea win! On brand with Jimmy Fallon. Series premiere tonight on NBC. Okay, Neil, let's move on to our Stock of the Week, Dog of the Week segment, where we pick one stock that is soaring high and one dog that is stuck in the mail. As a reminder, we are not financial advisors. The last math class I took was in 11th grade, and I received a D+. Neil, you won our F1 race down 6th Avenue in New York City this morning, so you can go first.

15:46Okay, so Boeing is my stock of the week. The aircraft manufacturer is up more than 5 % after it ran laps around its French rival Airbus at the Dubai Airshow, a huge event where airlines announce orders for new planes. Boeing scored 295 aircraft orders compared to Airbus' measly 86, marking the first time that Boeing posted more orders than Airbus since 2017. It's a sign that Boeing is finally moving past this crisis when two 737 MAX jets crashed in 2019. And the big order numbers show that airlines, especially in the Middle East, are hungry for bigger jets that can shuttle people around the world.

16:24I want to call out Emirates specifically because it placed a massive order with Boeing for 90 of its 777 jets at list prices of$52 billion. So my takeaway from this, international travel has boomed in the post-COVID world, and airlines like Emirates are buying huge planes capable of long-haul flights to capture that growing demand. Yeah, this was so interesting because I didn't really know how airplanes were bought. And when I was reading this article, I was like, someone just shows up and is like, I'll have 295 airplanes. It was super interesting. This was at the Middle East's largest aviation event, the Dubai Air Show.

16:57It takes place every two years, and this is like a big deal for the industry. So it looks like Boeing got a huge W and Airbus might be struggling a bit. Yeah, the problem with Airbus is they use these Rolls-Royce engines that are getting criticized across the industry. Something about how you buy planes is I said list prices is$52 billion. That's not actually what they're sold for. There's a negotiation that goes in place because when you buy something like 90 planes from Boeing, You're not actually paying the price that they put on the sticker on the windshield. Yeah, you're not paying sticker prices.

17:33No. So the$52 billion is what they call list price, but usually these airlines get a massive discount. I'm thinking Amazon has an opportunity here to go direct-to-consumer with some Boeing airplanes. That could be the next move. Let's talk about the dog of the week, which is the USPS or the United States Postal Service. So the USPS was supposed to break even this year under their big 10-year plan by the postmaster General Louis DeJoy. to achieve financial sustainability. Unfortunately, they didn't hit that goal. They're set to report a net loss of$6.5 billion this fiscal year. The revenue is great,$78.2 billion, but its operating expenses shot up and they hit$85.4 billion.

18:14In addition, the total volume of mail shipped has also dropped from 127.4 billion units to 116.1 billion units. So everything is a bit down. However, there is an awesome nonprofit advocacy group with the best name ever called Keep Us Posted, which is mission is to save the USPS, keep it sustainable. And they're blaming this increase in stamp prices and increase in prices across the board for reasons why some of the mail units are down. And so USPS is kind of going through a bit of a struggle, but I hope they can rebound. I don't know. Yeah, this advocacy group is criticizing the increase in stamp prices, and they've gone up at a historic clip.

18:57DeJoy has raised stamp prices five times in the last year or two, which has been faster in inflation. It's going to be up to$0.68 or something by January 1st, 2024. But I don't know what else you can do to get more revenue. I mean, like you said, people are sending less mail. So I don't know how else you can break even or become a profitable business without hiking prices. And I'm not sure that raising stamps from, you know, 55 cents to 68 cents is the problem here. If anything, I'm wrong. Maybe I don't understand mail, but that is you're not I don't know. It just doesn't seem like a huge deal.

19:34If anything, that will keep the save the dates invites down. Maybe just send those via email. That would be huge for me. But Neil, if you were in charge of the USPS, what would be your plan to save it? Right. So you need to capitalize on the high intent mailers. The average person like you and me are not going to send mail all that much, if ever. But there are moments in time across the calendar where people are sending lots of mail. There's wedding invitations. There's thank you notes. There's Mother's Day. And I think what you have to do, it may not be popular, is implement some sort of surge pricing where you're really jacking up prices for these high intent customers and making them pay more.

20:10I mean, when you have a wedding, you pay a lot of money for everything. And so if the USPS can jack up the prices on people who are getting married and sending these wedding invitations, they're not going to they're not going to blink if they have to pay a little bit more because that's what they're they're making so many decisions. So I think and of course, during Mother's Day and they already implement surge pricing during the holidays. That's just a common tactic. They're not doing it this year to try to give people a break. But that is my very simple, not creative solution is to just keep raising prices around for people who have a lot of price elasticity.

20:45Yeah. My more creative idea is, you know, race car drivers. They have all the logos on their jacket. Yes. Even in the NBA, they're starting to add patches. I think we we pimp out the male people and we put tons of logos on them. I want Uber ads, Target ads. Let's get some ad revenue in here. OK, let's check in on our good friend House Representative George Santos, who has been in the news zone the past year after it was revealed he completely fabricated most of his personal and professional life before being elected to office. Well, it's doubtful that he'll be in Congress for much longer. The House Ethics Committee released its findings from an investigation into Sandoz yesterday, and it concluded that he, quote, blatantly stole from his campaign, among other misdeeds.

21:28So if anyone listening to this donated to Santos' campaign, here's what he allegedly did with your money. Bought$1 ,500 worth of Botox, went on a more than$4 ,000 shopping spree at Hermes, and also bought cosmetics at Sephora. He paid down personal credit card bills and other debt. And for the icing on the cake, he used some of that money on OnlyFans, the platform popular among sex workers. Santos called these findings a smear campaign, but he also said he would not seek re-election next year. And that's even if he makes it that long, the House could move to expel him way before this. Yeah. Santos is very interesting because we know he's a liar.

22:05So when he says he's not running for reelection, I'm like, oh, so he is running for reelection. We're kind of like stuck in this like Pinocchio says his nose will grow. What will happen type situation with him. But the honeymoon and OnlyFans combination. Yeah, I didn't mention the honeymoon. Yeah, he spent a lot of money on his own honeymoon as well. He is a very, very interesting guy. His tweet about this was, quote, it is a disgusting politicized smear that shows the depths of how low our federal government has sunk. Everyone who has participated in this grave miscarriage of justice should be ashamed of themselves.

22:35And then followed up saying, however, I won't be running for reelection. So it's interesting. He's also severally pleaded not guilty to 23 federal charges. And he blamed, quote, stupidity and insecurity on his wide ranging fabrication. So, George, we just can't trust you at this point. When looking back in history, I said that Santos could be expelled if he doesn't resign. That basically never happens. There's only been five instances where representatives have been expelled. Three of those were during the Civil War. So this is something that just does not happen in our political history. And we'll see what happens with Santos.

23:09I expect him, you know, I don't think he wants to become the sixth representative to be expelled in the United States' very long history. So maybe he'll resign. But who knows with this guy? Yeah, very unabashed. He like Venmo requested a donor for 6K and was like, I'm sorry, I didn't Venmo request you earlier. I sat on this like a dum-dum. Like he like forgot to charge his friend for drinks two weeks ago. I don't know what George Santos is thinking, but I hope he is entertaining. He is entertaining. All right, let's move on to our last story of the day, which is a really interesting one. And Neil, I have some bad news for our millions and millions of listeners.