Latest / Elon Musk Podcast / Tesla’s new “affordable” Model Y and Model 3

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Tesla’s new “affordable” Model Y and Model 3 · Elon Musk Podcast

0:01
Hey everybody. Welcome back to the Elon Musk
0:04
Podcast. This is a show where we discuss
0:07
the critical crossroads that shape SpaceX, Tesla X, The
0:11
Boring Company, and Neurolink. I'm your host, Will Walden.
0:17
So Tesla is going to launch a more affordable Model Y and
0:22
Model 3. It's not the $25,000 model that
0:25
everybody was hoping for. No, it's like $40,000.
0:30
This is the affordable version of its Model YSUV and Model 3.
0:35
One of those $39,990.00, the other one's 36,990.
0:42
They're available for order with deliveries expected in December
0:45
and January. The next trim model up is $5000
0:49
more. So my guess would be to to save
0:54
the $5000 and then buy them the next the better model.
1:00
Don't worry about these ones. These yeah, it's still $40,000.
1:03
That's a huge amount of money for a car.
1:06
We were all expecting a $25,000 car or maybe 32,000 would have
1:11
been nice for a new car. But yeah, we were, we were not
1:18
given that we are going to 40 thou basically 40,000, a 37,000
1:22
and a $40,000 car. Now they're doing this because
1:28
they're trying to reignite slow sales.
1:29
But the pricing landed higher than a lot of people expected.
1:34
And investors and potential buyers unconvinced that Tesla
1:37
has truly entered the mass market because Elon Musk has
1:42
promised this, promised this for years.
1:47
We were supposed to get a, a cheap, you know, inexpensive, I
1:51
should say a value model of a Tesla sometime last year or the
1:58
year before ish. This is not it.
2:02
This is not affordable for most people.
2:05
So this is what they are, though let me tell you what they are.
2:08
The new versions cut some of Tesla's features, premium
2:12
finishes, high end driver assists and automatic seat
2:15
adjustments, but they still get 300 miles of range.
2:19
Plus, the company said the changes allow for lower
2:22
production costs and quicker delivery schedules.
2:26
But the threshold that would bring in new budget minded
2:31
buyers for the price is way too high.
2:35
Tesla had previously positioned affordability as the key to
2:38
unlocking growth. Neon Musk even said last year
2:41
that a sub $30,000 vehicle after incentives was essential for
2:46
broad adoption. So if you look at it like this,
2:49
the $7500 tax incentives are going away.
2:54
So they price this so it'd be around $30,000 if you get the
2:58
$7500 incentive from the US government.
3:03
So I can understand them pricing it at 37,000 and 30 and 40,000,
3:10
then it's around 30,000 for each.
3:14
But those are going away. Tesla stock fell 4.5% following
3:18
the launch, and investors saw the move as a pricing tactic
3:22
rather than a meaningful product advance.
3:25
Remember when Tesla would advance their products all the
3:29
time and create new wonderful things instead of stripping
3:33
things away? What they should have done.
3:36
A lot of people have talked about this too, and there's
3:40
they're going to do this eventually.
3:41
I think if they don't go full AI and robotics, they're going to
3:47
build an affordable vehicle under $30,000, but I believe
3:55
that's far away. They don't have the capacity to
3:58
do that now and they don't really care to, I don't think
4:01
because they're making enough money right now.
4:02
The stock is crazy. People will the stock will
4:06
rebound, of course, because Elon or Tesla will come out with
4:10
something in the next few days to pump up the stock again.
4:14
Elon always says something. I'll post something on Twitter.
4:16
Like, you know, working with SpaceX and Tesla together is
4:24
whatever. You know, people thought this
4:26
was going to be the Roadster too.
4:28
I thought it was not going to be the Roadster.
4:30
That would end cool. If we would have had two
4:34
announcements, a new Roadster and also a new $25,000 vehicle,
4:41
that would have been great. But that didn't happen, of
4:43
course. But you know, the standard
4:46
versions of these vehicles that are out now that just got
4:50
announced are roughly $5000 cheaper than the next level
4:53
trims. That's not really a new demand
4:57
though, $5000. When you're buying a car, for
5:01
most people it's saving up for a few more months. 3-4 months and
5:06
you can get 5000, maybe not 5000, but you can get a
5:09
substantial amount of money and get a loan, you know?
5:13
So the EV tax credit is expiring, which had helped
5:18
sustain its lower end sales. Without that cushion though, the
5:22
new Model 3 and Y now cost more than they did just a month ago
5:26
when incentives were still active.
5:28
And Tesla's decision to adjust pricing instead of developing an
5:31
all new low cost model is a new shift.
5:36
Last year, he quietly canceled plans for the long promised
5:39
$25,000 EV, choosing instead to rework existing platforms for
5:44
affordability. The decision raised concerns
5:47
amongst investors that cheaper variants could cannibalize
5:50
Tesla's high margin models also. So there's tension between
5:54
Tesla's growth and its need to maintain profitability in the
5:59
tightening EV market. They have, they have a lot of
6:01
competitors now. BYD is just ready to take it.
6:06
Take them out all over the world.
6:09
Tesla's losing market share because BYD has very inexpensive
6:12
models that are amazing cars, and Tesla can't compete with
6:16
that. They need to have that $40,000
6:18
car, don't they? But these new cars, they drop
6:22
amenities like heated rear seats, an LED light bar on the
6:26
Model Y, and Tesla's auto steer system.
6:30
Interior materials are simpler too, with textile seats standard
6:34
and vegan leather optional on the Model 3.
6:37
Tesla also switched to manual mirror adjustments, a cost
6:40
saving move that marks a clear step away from the brand's
6:44
luxury image. The company's decision to scale
6:47
back features rather than introduce new tech is a weird
6:51
one. Many see the cars as a practical
6:54
move to stabilize revenue, while Tesla continues to pivot toward
6:58
AI driven ventures such as robotaxis and robots.
7:02
Others view it as a sign to retreat from Tesla's innovation
7:06
driven identity. So this could be compared to
7:13
dropping Steve Jobs turtleneck for sort of like a Walmart
7:17
hoodie. You know, you need to appear
7:22
premium and practical at the same time.
7:25
But Tesla, they're still premium.
7:29
They're not affordable from most people.
7:32
Most people aren't going to buy a $40,000 car, to be honest with
7:34
you. They're going to buy a $30,000
7:37
car and these are $40,000 cars. This is how it is.
7:44
So competition is growing fiercer.
7:46
Like I said before, in the US, Chevy's Equinox EV and Hyundai's
7:51
Ionic 5, you know, they're, they're just ready to take out
7:56
Tesla. Tesla faces more than a dozen
7:59
electric and hybrid models priced under 30,000 in Europe.
8:04
In China, domestic automakers, BYD and others are sub 35,000.
8:13
So Tesla is squeezed between cheaper local rivals and premium
8:17
incumbents. But it's difficult.
8:21
It'll be difficult for Tesla to stand out.
8:23
They pioneered the EV industry, but can they continue to pioneer
8:29
to the next level? I'm not sure.
8:32
After this, it seems kind of weird.
8:35
They just downgraded a few things and then I think most
8:40
people will just save the money and or save the money up for
8:42
the, you know, few months and get a better model.
8:46
But, you know. Sales in the third quarter this
8:48
year rose to a record as buyers rushed to claim tax credits
8:51
before their expiration on September 30th.
8:55
But industry forecasts suggests that momentum won't last, is
8:59
going to level out or sink, and there's no incentive from the
9:02
government anymore. Tesla risk seeing demand
9:05
softened through the end of the year unless the new models gain
9:08
traction. I don't think they're going to,
9:09
though. They're too expensive.
9:11
Musk acknowledged the challenge earlier, saying during Tesla's
9:14
July earnings call that the desire to buy the car is very
9:18
high. It's just that people don't have
9:20
enough money in the bank account to buy it.
9:23
So yeah, I mean, you want it nice to say like, yeah, I want
9:25
nice things. But you know, it's like, yeah, I
9:29
want a mansion too. I want a yacht.
9:32
I want to, I want to rocket. I want a helicopter.
9:35
And I don't have the money for those things, but it'd be cool
9:38
to have them. There's the desire to buy the
9:41
car. So I think Elon's head is in the
9:48
wrong place here. I'm going to go out a limb here.
9:50
I'm going to say something that not a lot of people would talk
9:56
about that are in my position and saying this is a stupid
10:00
move. I don't think people, I don't
10:04
think people care that much. You know, you're going to have
10:07
your people that are just super psycho Tesla fans that are like,
10:12
this is an amazing move. But if you step back, and I'd
10:16
like to step back from every topic that I cover here, step
10:20
back and think about it objectively, I don't see a
10:27
difference between a $40,000 car and a $35,000 car.
10:35
It's $5000, but they're still super expensive to the normal
10:39
person. If it's a 40 thousand $45,000
10:43
car, you know, there's a certain market that has that kind of
10:46
money for a vehicle and they'll justify it in any way they can,
10:50
which is I don't have to buy gas, never have to go to a gas
10:55
station again, which is great for a lot of people.
10:57
They just plug in it at their house.
11:00
They'll justify it by saying, well, I can keep this car for a
11:03
very long time. I can keep this car for 10 years
11:06
and it won't, you know, I won't really need any maintenance on
11:09
it. I just need new tires eventually
11:11
or brakes, you know, and some some other small things.
11:16
So the maintenance repairs are minimal.
11:18
So they get their money's worth, but they also have the 50 or
11:23
$60,000 to buy the car. And if you don't have $35,000 or
11:28
$40,000 to buy a car, you're not going to buy a car anyway.
11:30
Not going to buy that car. You got to find a cheaper
11:32
alternative. Might buy a hybrid.
11:35
And at this point I don't see a problem with hybrids at all.
11:43
And most people don't need an EV.
11:46
Most people would love to have an EV to get around town and
11:51
most people just drive around their city or their town.
11:54
Most people don't take long road trips.
11:58
You go to work every day, you come home and that's pretty much
12:03
it for most people's lives. And every once in a while you'll
12:06
take a long road trip on the weekend.
12:08
But that's why a hybrid is a really good choice because you,
12:13
if you have your, your day driver, which is electric, and
12:18
then on the weekends, crank up that, crank up that gas engine,
12:25
that ICE engine, and, you know, get out of town.
12:30
But a $40,000 EV when Tesla was saying that they're going to
12:36
have less expensive E VS $30,000 would have been great.
12:42
You know, if if he could have got it to 29995 and just taken
12:49
out a few other things, that would have been a game changer
12:54
because everybody wants like people want a Tesla.
12:56
Like he said, people want a Tesla.
12:58
I think it'd be great to have a Tesla, but how could you have a
13:00
stripped down Tesla that is a great vehicle but doesn't cost
13:07
$45,000 or $40,000? You'd have to take out a lot of
13:11
stuff. Does it change a lot of
13:13
manufacturing and would it be worth it?
13:15
I think if you get under 30,000, people would buy it.
13:19
It just, it's that number, you know, $30,000 you can buy an ICE
13:25
vehicle. And I know people have the
13:27
reasons for not wanting an ICE vehicle, but you can get a
13:30
really nice ICE vehicle, ICE car for under $35,000 for under
13:39
$30,000 that has most of the things that Tesla has.
13:46
You know, it's not it's fancy, you know, you don't have full
13:48
self driving, but have lane assist that's nice.
13:55
Cruise control does a lot of work, you know, and you have you
14:00
have sensors too, right? So you don't need your car to
14:02
drive you everywhere because look where you're going.
14:05
Get off your phone and the the those vehicles are what
14:12
everybody else buys, you know, can buy like a technologically
14:16
advanced Honda for. Let me just look this up real
14:20
quick. Hold on, bear with me here.
14:22
I'm not going to edit this because I think it's I think we
14:28
should do this together. We're even do it like Carvana
14:32
style, because that's where people want to find a deal,
14:36
right. Let's go to Carvana and let's
14:40
look for Honda and we'll look for something that's like how to
14:50
CRV? How about that 33,005 brand new
14:57
nice vehicle, 2025, What does it got?
15:02
What do we got? Key features here Apple car
15:06
plate that's all you need Bluetooth music cool hands free
15:08
calling OK lane assist cruise control automatic braking blind
15:14
spot sensors collision detection lane departure warning rear
15:18
cross traffic alert rear view camera I mean and I'm I'm a fan
15:24
of Tesla. I know the technology is
15:25
amazing, but if you're in the $35,000 range and you want and
15:35
you want something that's a daily driver, but you need,
15:38
maybe you need something bigger, maybe you need a Model Y that's
15:42
$37,000 or $40,000, Sorry. But if you go down the scale,
15:47
you see some of the 33,032 thousand really great shape,
15:52
basically brand new. Would you pick that up?
15:56
Maybe you might, but maybe you don't like Hondas.
16:00
That's cool. I understand that.
16:03
Let's see how much a used Tesla is here.
16:07
We're doing this all together right now.
16:08
By the way, I used Tesla. We're going to do these prices
16:13
together. A 2025 Model 3 with 5000 miles.
16:23
Let's see here. What do we got?
16:25
2024 Model Y for 34590, 2023 model 3.
16:33
So if you don't need the cutting edge, you know, if you don't
16:35
need the cutting edge thing, you can get a 2023 model 3 for
16:38
30,000. Sounds great, right?
16:45
You get 2025 model 3 for 40. All black out of black, all
16:49
blacked out. It looks pretty sick, $2000 cash
16:56
down. You know, that's their estimate,
16:59
$2000 cash down. All right, that's not bad,
17:02
right? So if you look back at what
17:06
Tesla is offering, it's about a 35,000 to $40,000 vehicle and
17:18
it's cut down. So it's not sub 330 thousand,
17:23
which would have been great, but you can buy an ICE car for a
17:26
decent price and you could, you know, a nice ICE car for a
17:31
decent price. And that's what a lot of people
17:33
probably do. I'll be like, you know what?
17:34
This one isn't for me. I need something $20,000 less,
17:41
you know, or, or whatever, you know, the hottest CRV or Toyota
17:44
Rav 4 or something. Rav 4 is $25,000 to see those
17:46
things everywhere. It's not the fanciest car.
17:49
It's not like the prettiest car, but I see them everywhere.
17:53
I think it's, I think people are having good luck with them and
17:57
also something like a Honda. You'll never like the Honda.
18:01
They're so reliable. 2025 HRV, sub 30,000, that's it.
18:11
You know, it's a good car and most people, they'll make their
18:14
decision on the features that the car has and basically does
18:19
it do the things I needed to do and can it get me from A to B
18:24
safely? And will it like, I just wanted
18:27
to be dependable. I don't want it to break down.
18:29
I wanted to be safe. That's it.
18:34
You know, in most of these, most of these vehicles, these ICE
18:37
vehicles, sub $30,000 ICE vehicles, they're fine.
18:42
You're going to buy, you're going to buy a fine car.
18:43
It's and I think people underestimate that when they're
18:49
searching for a Tesla or another EV because these are great
18:55
vehicles for what they are, you know, and they might not, might
18:58
not be a thing. Let's see if they have a Rivian.
19:01
Let's do one more. Let's see what you can get.
19:04
I've never, you know what, I moved to the South and I see
19:08
these Genesis cars everywhere. Those are ugly though.
19:14
Not a fan, not a fan. Let's look for Rivian Land
19:26
Rover. Let's let's go Mercedes see if
19:27
we can find a sub 30,000 Mercedes.
19:30
Dude you can get a 2024 Mercedes Mercedes-Benz C Class for
19:34
33,000. You can get a Mercedes for 40
19:38
thousand 2025. Why wouldn't you get a benzo yo
19:43
get a a GLB for 35,000? Why wouldn't you get one of
19:53
those instead of a Tesla? It's up to you.
19:55
You know, most people would be like, man, I got 40,000, do I
19:57
want that benzo? Maybe.
19:59
Do you want this Porsche? I don't know.
20:06
There's Pulsar. Would you buy a Pulsar?
20:08
I don't know. Who knows what's going to happen
20:11
with that company or with this car.
20:13
Sorry. If you buy a Pulsar now, what's
20:15
going to happen to it? Is it going to be able to be
20:17
serviced? Maybe.
20:19
I don't know. They're nice cars, though.
20:21
I mean, they're not bad. But you can get a pulse star
20:25
pulse star 2 for 36,037 thousand.
20:32
But it's the same thing that literally has the same thing as
20:36
the how that I was talking about before.
20:39
Lane assist, cruise, adaptive cruise control, automatic
20:43
emergency braking, blind spot sensors, collision detection,
20:46
lane departure warning, parking assist, which the other one
20:49
didn't, but who needs that anyway?
20:51
I'm not good at parallel parking, so I could use that
20:54
actually. Is it worth the 3637 thousand
20:57
price tag though? I don't know rear cross traffic
21:01
alerts. It's I mean, and also the other
21:04
you know, it's it's an EV. It's nice and it has all the has
21:08
a nice interior and big screen. Apple car, play Android, all of
21:17
the above hands free calling. I like how they put that.
21:23
It's like, man, every car just comes should come standard with
21:26
that. You know, it's just be like, Oh
21:29
yeah, hands free calling. Of course, like you have a
21:31
speaker and you have a microphone in your car.
21:34
Of course you got to do hands free calling.
21:36
It's so funny. It's so funny the way they try
21:39
to upscale things that are just normal now.
21:44
Bluetooth music. Yeah, the parking assist, yeah,
21:51
if you can parallel park for me, man, might be worth that money.
21:55
I there was a spot that I was trying to get into the other
21:57
day. I just couldn't fit in.
21:59
Couldn't do it. I was, I was going to the city
22:02
to film something and I just couldn't fit my car in there.
22:05
I had to go around the block and walk like 2 blocks because my
22:10
car, it was in between like a giant construction truck and
22:16
another giant construction truck.
22:17
I was like, yeah, I could get in there.
22:19
Couldn't fit. So yeah, if this pole star two
22:21
could make it in there, I'd be pretty happy with that.
22:23
I'd pay the extra money for that.
22:25
That's worth it. So I don't know.
22:28
What do you think? Let me know in the comments.
22:29
What do you think of this whole shebang here?
22:34
The whole sub $40,000 basically 40 to 40 to 37. $1000 vehicle.
22:45
It's not that much, right? Not that much of a difference.
22:48
37, 37 at 40, it's like $3000 difference in these two models.
22:55
Model 1 in the Model 3, it, it just doesn't make sense to me.
23:00
It's still a lot of money. More affordable would be.
23:03
Great, take out a few other features.
23:06
Make them sub 30. People would go wild.
23:10
People would go insane. The stock would have went crazy
23:13
if it was sub 30 guaranteed. Let's check the Tesla stock
23:17
right now, see where it's at. Probably went up a little bit,
23:20
not still down 4.45% today. We'll check it tomorrow, but
23:25
earlier today it was at about four 49450 high and now it's
23:34
down to 433 O 9. So.
23:41
Yeah, stock took a little dump, but yeah, it'll come back.
23:44
And BYD stock went up .55%, Hyundai went up 2.21%.
23:53
Hyundai what's up with? You all right all right thanks
23:58
everybody take care of yourselves and also thank you
24:01
for listening. If you've been a long time
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listener, I do appreciate you and I appreciate all the new
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people here because I do this because I love it.
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I have AI don't know. I said 1000 episodes yesterday.
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It feels like I have 1000 episodes.
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I might have 5 or 600. I must have more than that.
24:19
I'll have to check that sometime and get back to you guys.
24:22
But it must have more than a 500 episodes of this show.
24:26
But love to do it and I want to keep doing it.
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So please continue to support the show.
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If you can take one second, probably a minute of your day,
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if you continue listening to the show and you like it, please
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take a second and do a five star review for the show please.
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That would be so helpful for me and it would help me continue
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doing this because the more eyes we get on this and the more ears
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we get on the show, the more I can continue doing this at A at
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the level that I've been doing it and make it even better.
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So I have I have some hardware that I would like to purchase to
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make the show better, make a sound better and to cut out a
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bunch of other like things that are wrong with the audio and
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takes me just like a long time to process it.
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So yeah, your, your five star ratings really help.
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Leave a comment on whatever podcast platform you're on.
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And if you want to subscribe to the show and follow us, that
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would be great because, you know, we could use all the
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follows we have. Let me tell you something.
25:35
I'm going to tell you some and tell you some details here.
25:37
I don't share this very often, but I'm going to be honest with
25:39
you guys because I think it's I think it's important.
25:46
Let's see, I have milestone markers on my Spotify, but let's
25:51
see, let's see what we got going on here.
25:53
And this is just Spotify for podcast is when I switched over
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how many how many views I've had or how many downloads I've had
26:00
in all time. OK, so and this is because of
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you. Over 3 million.
26:07
Downloads of the show. So in that sense.
26:13
All time let's. Do how many years has it been
26:17
all time that's doing the data right now?
26:21
I know it's taking a little bit. I'm not sorry about this, but I
26:26
want to. I want to tell you guys what's
26:28
up. But anyway, we have. 3,000,000
26:33
Downloads 3. Million plus.
26:36
Downloads of the show. And.
26:41
We have about. I don't know.
26:46
How many followers on? Spotify do we have now let.
26:50
Me, go back here. See what we got going on.
26:54
We have 3 million. 15,000. 652 streams and downloads, almost
27:04
18,000 Spotify followers and I'm just doing Spotify because
27:08
that's the one I have pulled up right now and I want to say
27:17
thank you for everybody. It's 33 million.
27:18
That's insane. Like that's crazy to me and.
27:23
I'm going to get. You some other stats some other
27:25
time, but I think you know, if we can, we can all stick
27:29
together here. 5 star ratings. So I started here.
27:33
Let's get you some other stats here.
27:34
What's what's that? So 2023 is when I started with
27:38
Spotify. I started working with.
27:42
Spotify here. Yeah.
27:48
So in that. But I've had the show since
27:50
2019, so it's six years old. I've been doing it for six
27:54
years. That's crazy, crazy, crazy,
27:59
crazy. So much, so much time.
28:02
So I've been around for six years, going to continue doing
28:05
it. Can't stop.
28:08
Won't stop, as they say. I'm still.
28:11
Trying to figure out. How many episodes I have?
28:14
Because it doesn't tell me in my stats here.
28:16
Just like look at all these episodes.
28:18
Cool, how many do I got? Doesn't tell me.
28:24
Don't tell me straight up front, but I have. 1000.
28:29
And eleven, 11101 episodes. That's where we're at now. 1100
28:34
and one 1101 episodes. That's.
28:39
Crazy 3,000,000 downloads 1101 episodes.
28:47
So thank you for that. Thank you for all your support
28:51
through 1101 episodes of the show.
28:56
That's a big deal. I didn't even realize that I was
28:58
over 1000, but I was just guessing the other day, so thank
29:02
you. I appreciate you.
29:03
All right, take care of each other.
29:06
And I used to do the regular outro because here we are.
29:09
Let's go, baby. Hey.
29:11
Thank you so much. For listening today, I really do
29:14
appreciate your support. If you could take a second and
29:16
hit the subscribe or the follow button on whatever podcast
29:19
platform that you're listening on right now, I greatly
29:22
appreciate it. It helps out the show
29:24
tremendously and you'll never miss an episode.
29:26
And each episode is about 10 minutes or less to get you
29:30
caught up quickly. And please, if you want to
29:33
support the show even more, go to Atreoncom Stage Zero.
29:38
And please take care of yourselves and each other.
29:41
And I'll see you tomorrow.