00:00The context is so interesting here because this feels a real about face.
00:04Why would now be the right time for the two companies to work together?
00:08Yeah, this is absolutely a huge reversal for Tesla.
00:12There's two things going on here.
00:13One, as we've discussed on this show many times, Tesla sales have not been as hot as they have been in years prior.
00:20There are a lot of new EV players.
00:22There's a lot of pressure on the company, particularly in China, to up its sales game.
00:27We saw some executives leaving earlier this year because sales have not been so hot.
00:32What is the most in-demand feature in EVs right now when making purchase decisions?
00:37Well, it's Apple CarPlay.
00:39People like to walk into their car and have their iPhone interface projected onto their infotainment system.
00:46I use it in my car.
00:47People are not buying Teslas because of it in some cases.
00:50People are buying other cars because of the well-integrated support.
00:54For Tesla that wants to hit every lever it could to improve sales, you do that with CarPlay, right?
01:00And I would expect them to go down the list of all the requests that people have for wanting to buy a new car and hit those one by one to help sales.
01:09It's time for Tesla to do that as good as their infotainment system is.
01:12The second thing, of course, is Elon Musk's $1 trillion pay package, which includes some metrics, particularly around selling a certain number of vehicles.
01:21And integrating CarPlay could potentially help with that.
01:25And so I think this is a good thing for Tesla.
01:28They have engineers developing support for this, testing support for this.
01:31And we anticipate a rollout unless it is canceled, of course, which Elon Musk is known to do with some features late in development in the coming months.
01:39Mark, you worked with Ed on this story.
01:41And I'm interested as to, well, what is in it for Apple more broadly?
01:46Elon, in many ways, had refused to do deals because he didn't want the sharing of data, particularly when Apple was basically building a competitor at one point.
01:54Apple backed away from that.
01:55Now, how do they win by getting CarPlay within a Tesla?
01:57You know, from Apple's perspective, this is something that they don't really have to participate in.
02:04There's no agreements behind the scenes.
02:06Apple provides this functionality.
02:08It provides developer tools for car makers to integrate this into their cars.
02:13So there's no money exchanged here.
02:15It's really CarPlay, a iPhone ecosystem feature.
02:18If consumers rely on their iPhone for use of their car, for Apple, that keeps people buying iPhones, upgrading iPhones, keeping them locked.
02:27Into the ecosystem.
02:29So that's the business play for them.
02:30And Tesla, right, has a, you know, over a third of the U.S. EV market.
02:35They are a gigantic player in terms of car sales globally as well.
02:40And aligning Tesla with the iPhone brand, that's great for Apple, whether they're making money directly on it or not.
02:46Do you think Elon's going to continue to criticize Apple on his X platform and the like?
02:52Oh, I'm sure of it.
02:53But, you know, his relationship with Apple has taken a turn since Apple stopped developing its own competitor.
02:58He relies on them very heavily now for distribution of Grok and X.
03:02So it's pretty critical for him to be on Apple's good side.
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