The Tesla Die-Hards Who Are Calling It Quits
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Welcome to Tech News Briefing. It's Monday, March 24th. I'm Victoria Craig for The Wall Street Journal. As some diehard Tesla fans ditch their stock in the company, Elon Musk tells employees they should hang on to theirs. Then, the Russo brothers, famed for blockbuster movies like Avengers Endgame, are using AI as a creative tool to try to keep it from taking over jobs in Hollywood.

But first, don't sell. That was the message from Tesla CEO Elon Musk at a recent all-hands meeting where he pitched his five-year vision. It included global regulatory approval for autonomous vehicles, and Musk said that would lead to people taking road trips without ever touching a steering wheel. He argued that while he remains optimistic, sometimes stock market investors are too focused on the past to see the future. Elon Musk

It's very difficult for like, you know, people in the stock market, especially those that look in the rear view mirror, which is most people, to imagine a future where suddenly a 10 million vehicle fleet has five to ten times the usefulness. It does not compute, but it will compute in the future. So what I'm saying is hang on to your stock.

The reality, though, is investors have been selling Tesla shares. The stock is down nearly 40 percent since the start of the year. WSJ's Hannah Aaron Lang has been talking to some of the individuals participating in the sell-off.

So, Hannah, tell us about these people you spoke to. These are folks who were first drawn to Tesla and even to Elon Musk specifically several years ago and bought shares of the stock in large part because of their faith in the company and what they thought it could do.

for the future of electric vehicles and then also for technology more broadly. And what specifically have some of these investors told you about why they're selling? So, you know, some of these folks disagree with Elon Musk politically and his role in the Trump administration. Tesla has certainly attracted in the past a lot of environmentalist types who bought into this kind of

techno-utopian vision that Musk espoused for clean energy and the electric vehicle transition. As you can imagine, many folks in that group maybe don't identify as conservative in their politics and disagree with Musk in that sense.

Others have just found his recent behavior, as his political persona has grown, just erratic and unsettling. Not necessarily what they would hope for from a chief executive of a company, even if they did share some of his political beliefs.

And other folks just thought that the CEO of a company being so involved in the government, potentially alienating some customers or even just being really preoccupied with a separate project could be bad for sales and bad for the brand.

And Tesla has been one of the so-called Magnificent Seven stocks, one of those tech companies that's really seen as benefiting from AI. And it rallied hard last year, but we've seen that reverse this year. What does that tell us? You mentioned the Magnificent Seven. Those stocks have not done as well this year, in part because of just its

broader re-evaluation of risk throughout the stock market. There's concerns about a trade war. There's concerns about the economy and even concerns about artificial intelligence. And, you know, if it's really going to deliver profits at these companies as promised. Tesla stock is definitely a

being impacted by those broader market trends. But I do think Tesla has faced some unique problems. The company has seen some hits to their sales numbers. Competition in the electric vehicle industry is intensifying. Some of the investors we spoke to cited those types of concerns.

We just heard that Tesla has to recall most of its Cybertrucks because a panel on the side of the vehicle could fall off and potentially harm people on the road. So I think that there are Tesla specific challenges, there are Musk specific challenges, and also just broader market dynamics at work here.

The Trump administration has been unusually involved with helping to bring positive attention to Tesla recently. The president selected a red sedan from a private showing at the White House. The commerce secretary put his own buy rating on the stock on TV. And even Elon Musk himself held an all-hands meeting at Tesla and told employees to hang on to their shares. What effect has that had on the stock?

It seems like neither of these things have had a permanent or super significant impact on the stock. Though the Trump administration has spent time on this, it doesn't appear to have turned around things for Tesla quite yet, at least in regards to its share price. Of course, there are fans of Tesla, fans of Elon Musk. I wonder if any of the investors you spoke to cited that as reasons to be optimistic about owning the stock. Please.

Plenty of retail investors still love Tesla stock, right? We've seen a lot of data to suggest that there are still a lot of diehard fans out there who are buying the dip right now and have various points over the course of 2025. But I think the risk that I heard cited previously

with the individual investors that I spoke to is anytime that you involve yourself deeply in politics, you're going to alienate some customers. I think our reporting suggests that Musk's prominent political persona is hurting the Tesla brand, and at least some investors are starting to think that could continue to hurt profits as well. That was Wall Street Journal reporter Hannah Aaron Lang.

Coming up, maybe artificial intelligence doesn't have to replace human jobs after all. Our tech columnist talks to the Russo brothers of Avengers fame who are working to keep AI's power over the entertainment industry in check. That's after the break.

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The Russo brothers are famed for directing two Avengers films that became some of the top money-making movies in Hollywood history. Now they've set their sights not on another blockbuster, but on building out their production studio called Agbo. They want to use artificial intelligence as a tool to help creatives in their industry, rather than train it to be a system that replaces them. Our tech columnist Christopher Mims spoke to the brothers about their studio's AI efforts, which are in the R&D stage.

So the Russo brothers are taking on artificial intelligence, but they want to work with it rather than against it so it doesn't eventually replace actors in Hollywood studios. Just walk us through what their plan is. So one thing that's been happening in Hollywood video games lately is folks are using AI to eliminate the jobs of concept artists, for example. They'll replace them with AI image generation tools and voice actors because they'll use AI clones of...

actors' voices. The fear is that eventually we'll just start using AI to generate movies themselves. And so the Russo brothers' whole idea is we don't want to leave the future of AI in filmmaking in the hands of tech companies because they will be dastardly in how they use it. And they want to try to use AI to, for example, accelerate the creative process. Now, they're pretty vague on what that looks like.

But based on previous interviews with their chief scientist, Dominic Hughes, it sounds like...

They believe that AI can be a companion when you are coming up with new ideas, for example. There is research to back that up. It comes from a totally different part of the economy. Business professors have noticed, for example, that if you ask students to generate ideas for new companies, they will generate more ideas and more creative ideas when they partner with an AI, and they will beat both humans and AI on its own. One of the things I found fascinating is that the Russo brothers worked

want AI to hallucinate, which is effectively making stuff up, which when we talk about AI and other applications in life or business, we don't want that to happen. We want it to really be factual. We want it to be accurate, right? Yeah.

Absolutely. So it's always important to remember that hallucination is what generative AI does. You can't separate hallucination from how it functions. And so their chief scientific officer has said, why don't we just lean into that? Like, why don't we use it as a tool to help us come up with new ideas and be creative rather than trying to do what all these other companies are doing where they're like,

Please stop hallucinating, even though that's your core nature. And please just give us accurate search results. And of course, we've seen how that is going. Google itself is getting polluted with all kinds of nonsense search generative results.

Another thing you mentioned in your piece is that one of the most important aspects of this is that it's low cost. So walk us through that concept. So the Russo brothers, like everybody, are super aware that production costs in movies and video games, even in things like theme parks, just keep going up and up. There's some irony here because it's rumored that Netflix spent $320 million on the Russo brothers, which

most recent film, The Electric State, which went straight to streaming and is probably the most Netflix has ever spent on a movie. Their thesis is if you're creating so-called digital assets, so like 3D models, sets, characters, maybe even voices, why not reuse them in a movie, in a video game, in a theme park, in some other future VR medium that we haven't even invented yet?

And that way you can cut down on production costs kind of in aggregate across all these media. The whole idea is it's called transmedia. Perhaps there's a future in which Hollywood and video game companies are more closely aligned. There is a Japanese video game maker which invested $400 million in the Russo Brothers studio in 2022. So suggests that kind of convergence is coming.

That was WSJ columnist Christopher Mims. And that's it for Tech News Briefing. Today's show was produced by Jess Jupiter with supervising producer Matthew Walls. I'm Victoria Craig for The Wall Street Journal. We'll be back this afternoon with TNB Tech Minute. Thanks for listening.