Morning Brew Daily - 2025 Laws Take on Social Media and Minimum Wage & Tesla Suffers First Sales Slip

Episode Date: January 3, 2025

Episode 489: Neal and Toby recap the major laws on AI, social media, guns, and cannabis that go into effect in 2025. Then, both the New Orleans attack and Las Vegas Cybertruck explosion were vehicles rented on the car-renting app Turo, which raises the company’s vetting process. Also, Tesla has its first-ever annual sales decline in over a decade. Meanwhile, Squid Game Season 2 is this (short) week’s Stock of the Week, and the norovirus outbreaks is the Dog of the Week. Lastly, a headline roundup to get you through the weekend.  Subscribe to Morning Brew Daily for more of the news you need to start your day. Share the show with a friend, and leave us a review on your favorite podcast app. Listen to Morning Brew Daily Here: https://link.chtbl.com/MBD Watch Morning Brew Daily Here: https://www.youtube.com/@MorningBrewDailyShow 00:00 - Ins/Outs of 2025  02:00 - New Laws in 2025  07:45 - What is Turo? 12:40 - Tesla Sales Drop 16:00 - Stock of the Week 19:30 - Dog of the Week 22:30 - Headlines Learn more about your ad choices. Visit megaphone.fm/adchoices

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pwc.com slash U.S. slash brew AI. That's pwc.com slash us slash brew AI. Good morning brew daily show. I'm Neil Fryman. And I'm Toby Howell. Today, Tesla's traditional car business is losing steam. Only

self-driving can save it now. That Netflix just had its biggest TV debut of all time and it had nothing to do with the NFL. It's Friday, January 3rd. Let's ride. It's that time of the year, the very beginning, when everyone is

posting what's in and what's out for 2025. Toby, you consider yourself a tastemaker. You even have a segment called Toby's Trends after all. So what's going to be in this year and what's going to be Passae? All right. In this year is earnestness. Out is aloofness. We are trying hard and taking things seriously in 2025. In long distance running out long distance relationships just move already. It's good for the soul. In pronouncing words incorrectly, oddly enough, so we're giving ourselves some grace. Out is saying it Chipotle or Navidia. Those two are crossing the line. And then finally, in business news podcast. Absolutely. Out. Being uninformed. I feel like that one speaks for itself. Neil, you don't have a Toby's Trend segment, but do you have an in and out? I have a few. My first one

has to do with running as well. I think running clubs are out. Oh. Yeah. Too many. Swimming is in, connections is out, crosswords are in. I think TikTok is out, whether there's a ban or not, and it's going to be a big year for LinkedIn. So LinkedIn is in. And then my last one is the concept of vibes are out. There's been too much talk of vibes over the past few years. No one really knows what it means. What's in is going to be data-based decision-making. Okay, here's what I want to hear from you guys. Tell us if Toby's in and out are in or out, and then tell us if Neal's in and out or in and out. That might be a little confusing, but give us some feedback here.

All right, like all of you, U.S. states make their own resolutions on New Year's, but those come in the form of new laws. Tens of thousands of new laws went into effect on January 1st across the country, impacting everything from social media use to minimum wages to Taylor Swift tickets. Toby and I are going to give you a quick tour of the most important and bizarre laws that are now active, so you can learn something and also avoid jail time. First, let's talk internet. Florida's first of its kind controversial law that bans children under 14 from having social media accounts is technically in effect now.

Enforcement is being delayed due to legal challenges filed by industry groups. Remember, under this law, social media platforms will be responsible for terminating and blocking any accounts belonging to people suspected of being under 14 with the goal of protecting kids from online harms. And then in terms of the minimum wage, workers in 21 states will get a pay bump as of the first of the year. The highest will be in three states, Washington, California, and Connecticut, all of which now have wage floors of more than $16 per hour. The federal minimum wage has not budged from 725 an hour since 2009, so many states and cities have taken it upon themselves to raise their minimum wages to help workers keep up with greater cost of living expenses.

Toby, any of these laws you want to dive into. Yeah, let's dive into that social media law from Florida because it also extends to something beyond social media, and that is adult content websites. The law also requires adult content websites to age, verify for access with the goal of protecting kids from certain websites on the internet. And it's not just Florida either. We are seeing this really across the south and across the country. Tennessee, South Carolina, in a growing list of 14 other states now have residents who can no longer access those popular adult content. websites, those popular pornography websites because of age verification laws. So, ALO networks, which owns some of the biggest adult content websites out there, they decided

to just block users because they don't think that they can actually comply and perform these reasonable age verification requests. And there's been some pushback, obviously. Some free speech advocates say that it's just going to push people to even darker in more dangerous parts of the internet. And they're not doing much to protect the actual people that. they are trying to protect here. So there's definitely going to be some Supreme Court arguments that do come down related to these cases. But I do think that's a theme of some of the laws

that you described here is just protecting child protections when it comes to online activity. Right. I just want to put a point on it. 17 states across the U.S. South and other parts of the United States can no longer access Pornhub and other adult content websites because they are deciding to not comply with these age verification rules over privacy concerns. They say we don't want to be collecting this information. So we're just going to block you. And that has been a huge trend over the past few years. Started with Louisiana two years ago.

And what you see after all of these bands come into effect is a massive spike in VPNU so people can skirt these blocks. So when this happened in Florida on January 1st, two days ago, there was a VPN. search spike of 1,150% within hours of it going into effect. So people will have their point of whether they, whether it's blocked or not. And that's very similar to what we saw in other states like Utah saw 967% spike in VPN use in 2003 when their law went into effect. And Texas had a similar spike when that law went into effect as well.

But you're right. This is going to the Supreme Court, likely because free speech advocates have taken the site taken the side of these adult content websites, and I've challenged this Texas law specifically. So we'll probably hear arguments on that. Well, I won't, but the Supreme Court will on January 15th. So that could have widespread impacts for all of these states that have put up these barriers. So what else is going on other than these child protection laws,

other than the minimum wage increases, some other laws that are going into effect. Illinois gyms must allow memberships to be canceled by email or on their websites. I know a lot of people have had that really tough, experience with the gym trying to actually cancel the membership. You may sign up for around the New Year's time. California gave child influencers. Similar protections that child actors have. You have to, you know, if you are dancing on social media with your mom or dad, there are now new laws that do allow you to, you know, recoup some of the financial gain that they are receiving.

Also, Minnesota adopted those ticketing transparency laws. Five states adopted pay transparency laws as well. there's some weird laws that are going in effect as of 2025. California now allows marijuana dispensaries in venues to offer live entertainment. So think maybe similar to just like a club where you're drinking alcohol. Now they're having these clubs that can bring a band in where people are allowed to smoke marijuana. Think like cannabis cafes in Amsterdam style. Yeah, Amsterdam is definitely going to be the kind of blueprint there. Washington, D.C. actually has a cashless retail prohibition.

law coming down that mandates retailers must accept cash payments. If you've ever seen those signs that say, we prefer charge, we do not accept cashier. That is now against the law in Washington, D.C. And then New York passed a car wash promotion disclosure law, which requires car washes to clearly inform customers about promotion expiration dates. You know what, that's very important. That's very important. I can't believe people are driving in New York, let alone washing their cars. So again, Neil said this could potentially help you not run a foul of some of these laws. Hopefully none of these are you're running into and you're not

facing down any legal issues in 2025, but those are some of the laws that you should keep an eye on. Moving on to the next story, the FBI has found no definitive link between the devastating New Orleans attack that killed 14 people on New York Day and the cyber truck that was blowing up in Las Vegas

hours later. But there is one commonality between the two. Both the cyber truck in Vegas and the Ford F-150 lightning truck used in New Orleans were rented through the same car sharing app, Turrow. It's put the once high-flying startup, which had plans to go public last year, squarely in the national crosshairs, and raised questions about its security and vetting process. As of last year, Turo had 360,000 cars listed on its platform, where users

could rent them out in a peer-to-peer system similar to Airbnb. But the company said that neither driver had anything in their backgrounds that would have raised alarms during the app's screening process. Still, the owner of the truck used in the New Orleans attack told the New York Times that he plans to stop using Turo going forward to make extra money. Neil Turo was worth one and a half billion dollars back in 2020, according to Pitchbook. But the IPO it registered back in 2021 has yet to materialize. And now it's found itself at the center of two tragedies as we enter into 2025. Yeah, Turo put out a statement saying we acknowledge that both of these incidents were used

Truro rental cars but said that no red flags were raised and they didn't mention the details of their screening process I've rented on Turrow before like you have to put up your driver's license and put in some other information

they say they reserve the right to do a background check on you and learn more about you before they grant you permission to to use their platform but they said that those people met those these rigorous safety requirements So there's looking into it, and yes, you're right, the spotlight has been on Turo.

But investigators do say that the fact that, you know, they both happen to be within hours of each other and use Turo was a coincidence. But, you know, when you do certain attacks like ramming cars through people, which has, you know, seen an uptick recently, then, you know, there is a decent chunk that use rental cars. 5% of 184 vehicle ramming incidents between 1970 and 2018 used a rented car. And that's according to a study done by San Jose State University. And that shows intent and planning because you have to go rent the car. So this is not necessarily super rare. It's not super rare. And also, Turro is a company that I called it a high-flying startup.

And it does, it is a very large company reported $880 million in revenue in 2023. That was up 18% year over year. It did saw its profits fall from $154 million to $14 million, which may have clouded that IPO picture. This was a pretty buzzy company at one time. Celebrities like two chains, NBA, NFL players have invested in Toronto. It's got almost 1,000 employees, so it is a relatively robust company as well. Let's also just zoom out a little bit to some of the aftermath from these attacks. We did see the Sugar Bowl happen after it was delayed in.

New Orleans. Notre Dame won that game. Some other updates from the two cases as well. Bourbon Street in New Orleans is back open to the public as of yesterday, obviously with an increase police presence. The FBI also clarified some earlier reports that said that the Army veteran involved in New Orleans had help. Instead, they claimed he did act alone. Surveillance footage kind of caught him, placing coolers down with explosives that have since been disarmed. Also investigators reiterated that there wasn't a clear, link between the two. Again, we've talked about the fact that they both use Turrow. Both men did serve portions of their U.S. Army careers in what was formerly Fort Bragg. It is now Fort Liberty

in North Carolina. They also spent time in Afghanistan during similar times, though at different locations. And of course, they both use Toro. But so that's kind of just a rundown of what we know now on the two attacks. And they did identify the driver of the cyber truck who was an active duty green beret. He died by suicide in the car. believe before the explosion went off. So as investigators try to untangle that cyber truck mystery, Tesla reported its delivery numbers for the 2024 year, which is the most closely tracked metric for how its electric cars are selling. And it was historic and not in a good way. Tesla's annual vehicle sales declined for the first time ever. It sold 1.79 million

vehicles last year, a 2% decline from the year before. That missed its own estimates of modest growth and sent its stock tumbling more than 6% on the day. It wasn't too long ago that Tesla was notching gains of 50% year over year, but that growth has gone into reverse. Tesla's struggles are well documented by this point by us and by others. It's facing increased competition from legacy automakers and Chinese upstarts. Demand for electric vehicles has slowed across the board, and it's got an aging vehicle lineup that consumers appeared to be pretty bored of. CEO Elon Musk has tried to shift investor focus away from its traditional EV business and toward an autonomous and AI-fueled future, a marketing pitch that has mostly succeeded. Tesla's stock jumped nearly

70% last year, with most of that coming after Trump's election. Still, these numbers are a stark reminder that what Tesla makes money on now, not five years from now, has hit a wall, and that could be a problem. The last time Tesla suffered an annual sales dip was in 2011, which if you look at it on the chart of Tesla's vehicle sales. It's just a mere blimp. That was before it released the Model 3, the Model Y, which accounts for 95% of its deliveries at this point. Tesla leaned on promotions and price cuts.

That was a big theme of last year where they were just slashing prices. They had the margin to do so in order to try to spur demand, but there's only so much you can do in the face of very tepid, very minimal consumer demand for electric vehicles. Meanwhile, you mentioned competition from Legacy Automakers, but definitely the biggest competition is coming out of China. BYD actually outsold Tesla in the electric vehicles for the second quarter in a row. Tesla still nabbed it over all on the year, so it still can claim it's the largest EV seller in the world. But yeah, the competition mixed with the tepid demand is definitely why we saw electric vehicle deliveries falter for the first time.

So why did Tesla's stock jump nearly 70% last year? Because investors know everything we know and possibly more. They know Tesla has a vehicle lineup that hasn't had a refresh in many, many years, besides the cyber truck, which is new, but that didn't really impact sales, according to these latest figures. They're just hoping that Musk's pie-in-the-sky pitch that Tesla will transform the auto industry yet again into a self-driving thing will come to fruition. Tesla unveiled its cybercar, cyber cab, which is a self-driving robotaxie that will hopefully

come into being in 2027. It's spent $10 billion on AI last year alone. It has this optimist humanoid robot. So it's really branching out into these very moonshot bets that, you know, remind you of Google. The thing about Google is it has. an ad business that makes it tons of money that's growing double digits per year. Meanwhile, Tesla's pot of money that it can draw into to put on these futuristic bets is declining. So investors are really putting their faith in Elon Musk that he can deliver on these very ambitious

promises to pivot Tesla from a traditional car company into a more, you know, AI self-driving company. So its market cap completely rests on this. And if Musk can't deliver, then Tesla, you have to feel like its stock will take a big hit. Up next, it is Stock the Week. Dog the Week time. We're the Hartford. With decades of experience ensuring millions of unique small businesses,

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Now through May 6th. Exclusion supplies to home depot.com slash price match for details. It is Stock of the Week, Dog of the Week time, where we pick one stock who is still in holiday break mode in one stock that has locked back in. But since it was a shortened trading week, we bet the rules a little bit and chose two non-stocks that still fit the spirit of the segment.

I won the pre-show 45-minute power interval Peloton session, so I am up first. And my stock of the week is Squid Games 2 because it has been a smashing success. Season 2 debuted to 68 million views in its first four days available, which officially makes it Netflix's biggest, premiere ever. It's also already climbed the ranks to land at number seven on Netflix's most popular non-English shows, a metric that takes into account a show's first 91 days of viewership, so it's

still got more room to run. Still, it's got a long way to go before it can dethrone Netflix's all-time biggest show, which is the first season of Squid Games that is sitting pretty at 265 million views. Neil, there was fear that the three-year delay between seasons might dole this series appeal, which pits contestants against each other in childish games with life or death implications. But clearly that has not been the case here. And Netflix is putting their foot on the gas with Squid Game. It's not just a show anymore. It is a franchise.

There's in-person experiences. They created a reality show based on Squid Game. They greenlit a third season. We had to wait three years between the first season and the second season. Well, good news for anybody who likes the show, which apparently is a ton of people. because the third season is coming out this summer. So they are leading into Squid Game as a franchise that can be monetized in many different ways, very similar to what they did with Stranger Things.

But just what a surprise hit that no one saw coming. And I think, you know, why do you, you know, I'd love to hear your opinion. Why do you think it's resonated? Many, you know, some have speculated that it's the survival type show that does really well. It touches on interesting themes like economic inequality. also it just catches fire on social media because it's so memeable. It's dull. I know it is.

I see it everywhere. It's very memeable. But also, you have to remember the first Squid Games came out of nowhere, like you described, during the pandemic where it did feel like everything was up to the max. There was a lot of economic hardship at the time. So it just really resonated then. I think there is a lot of those same feelings, even three years later. One thing I thought was interesting is that the show's creator actually created the show

because he was feeling similar things. He was down to his last dollar. He created the show about people down to the last dollar who will do desperate things. And Netflix pretty much entirely footed the bill of the first season because they were taking a big risk on this basically no-name writer. So because Netflix paid for the season up front, a lot of the actors weren't actually immediately compensated

in, you know, kind of accordance to how big the show got. So the writer did want to create more seasons. He left season one on a cliffhanger. in order to give some of the actors, some of the people involved in the show, a bigger chance to participate in financial windfall going forward. So I thought that was interested, that the writer felt motivated to write more episodes.

And so these people who made the show what it is could, you know, reap the benefits financially. And I'm just happy that he is going to be able to put up his legs because he said he lost 7 to 8 teeth while writing the first season. And he's like, I get so stressed. I get gum problems when I write. So this is going to be my last series ever. This is too much of a mental challenge for me, but, man, you did good.

My dog of the week is norovirus, so I hope you had breakfast already, because by the end of this, you probably will have lost your appetite. Neurovirus cases are on a major upswing this year, with outbreaks on cruises, unsurprisingly, generating the most headlines. So far this year, there have been 16 outbreaks of gastrointestinal disease on cruises, the CDC said, the most in 12 years. The majority of those are norovirus, a, highly contagious virus that gives you, let's just say, the stomach bug of all stomach bugs,

what enters your body, leaves it quickly at both ends. And the spread really picks up in winter. Five of those cruise outbreaks occurred in December alone. And there's a ship that's docking today in New York, the Queen Mary 2, where almost 13% of passengers and more than 5% of the crew have been infected. In response, the affected cruise companies say they've ramped up their cleaning and sanitizing efforts and are pushing back against claims that cruise ships are a particular hotbed for norovirus, which they do have a point on neurovirus outbreaks on cruises comprise only 1% of all those reported. Toby, this sounds horrible. Anyone you know get norovirus recently? Neil. I've had it recently. I don't wish it on my worst enemy. I had it over the winter break.

My girlfriend did as well. It was tough. Also, you factor in, you know, the questionable fay on a cruise ship. The choppy seas as well, the fact that you're just locked on the same ship with a ton of other passengers who also might have it. I think that is just the worst thing on earth. One of the reasons why it does, most of these outbreaks do occur in the winter months, is that norovirus is passed through close contact, direct contact with food or water that's been contaminated with tiny particulates of, you know, infected feces, infected vomit. I know. Sorry, this is a morning show. But you see these nationwide surge is when we're all a little bit closer to each other indoors and not a lot of people are outside as well. Novo-norovirus outbreaks actually declined during that 2020-2020 pandemic season because of the fact that there weren't very many social activities as well. So that was maybe we're coming back from a little bit of a depressed time for neurovirus into a much more active time for norovirus. But yeah, Neil, you have a twinkling your eye.

but I do not because it is just the worst thing on earth. And I hope none of you guys listening are struggling with it right now. Now, let's sprint to the finish of the shortened week with some headlines. If you ever thought your phone was a little too good at picking up on hints as to what you wanted for Christmas, you could be entitled to some cash. Apple has agreed to a $95 million settlement in a class action lawsuit alleging that Siri recorded private conversations without user consent. The lawsuit claims Siri unintentionally activated and recorded snippets of confidential conversations,

which were then shared with third parties like human reviewers or advertisers. If approved by the court, eligible Apple owners in the U.S. could receive up to $20 per Siri-enabled device. Neil, big validation for all the moms out there who think their phones are listening to them. Well, apparently, this all started with a report from The Guardian in 2019 when a whistleblower came forward and said that, Siri would be inadvertently activated sometimes when an Apple watch was raised and a speech was detected. So you didn't know that Siri was activated. People said that they suspected something when they got specifically, like unusually targeted ads for things like Air Jordan sneakers when they were talking about it and they attributed that to Siri. Now, Apple has denied that

they use this data for advertising subsequently or selling that. But it just goes to show you maybe you know, this is just more worse PR for Siri. So yes, if you bought a Siri-enabled device through 2020-24 from 2014, then Apple, if this settlement is approved, Apple will send you a message and maybe you can claim your $20. If you were feeling deja vu when going to the movies last year, there's a good reason for that. The box office numbers for 2024 are in, and nine of the 10 highest-grossing movies were sequels. And the other one was wicked, which is an adaptation of a musical. Those sequels were Inside Out 2, Dispickable Me 4, Deadpool and Wolverine, Moana 2,

Dune Part 2, Beetlejuice, Beetlejuice, Kungu Panda 4, Twisters, and the 38th Godzilla movie, Godzilla Kong, the New Empire. Toby, there was this hope that original storytelling would stage a comeback after the success of Barbie and Oppenheimer in 2023 and everything everywhere all at once. But no, it seems like when Americans go to the movie theaters, we just want familiar comfort food. Oh my gosh. Reading down that list is a little bit of a dark timeline. I'm going to choose a little bit of a brighter theme to the 2024 box office,

and that is PG-rating movies actually did very well because a lot of those stories that you mentioned are actually PG-rated. I don't want to go down the list again. But mostly all the movies, the animated movies that were family-friended, did really well because the biggest movie of 2024 was Inside Out 2 was also the biggest animated movie of all time. also was a big year for Disney as well at the box office. They had a quiet 20-23, but came back three of the top five movies of the year. And actually, it's 20th Century Division that it recently bought did well as well.

Alien Romulus, Kingdom of the Planet of the Apes, kind of snuck in there to boost Disney's year at the box office as well. The list of the most on-time airlines in the world last year is out, and you're probably thinking it's always the one I'm never on. But the actual answer is Aero Mexico. According to an analysis by aviation analytics firm Sirium, the Mexico City-based airline completed nearly 87% of its flights on time in 2024, which means that a plane arrives within 15 minutes of its scheduled landing time. As for U.S.-based airlines, you don't have to go far too down the list to find one after Saudi Arabian Airlines at number two. Delta rounds out the top three most on-time airlines.

That was surprising because, remember, Delta had the huge crowd strike meltdown that did. delay and cancel a lot of flights in the middle of the year. But again, that was only about one week throughout a year of very on-time departure. So, yeah, Delta did really well. Although they should be kind of looking in the rearview mirror because United Airlines snuck in at number 10, but they have been steadily increasing their on-time percentage by about 1 to 2% per year. So people are saying some industry analysts are saying that United could eventually catch up

and maybe even surpass Delta going forward. Well, this was my suspicion. and it seems to be true that airlines have been cooking the books on this a little bit because they say a flight is going to be longer than it actually is. And I look this up. There's actual data on this. The average scheduled duration from JFK to Los Angeles has increased 23 minutes since 1995. Even though it doesn't take any longer to fly from New York to Los Angeles,

they say it's going to take 23 minutes longer over the last 30 years in order to boost these. on time stats because we leave the gate like five minutes after you the scheduled departure time and I'm like, okay, there's no way we can be on time. And then, you know, an hour into the flight, the pilot comes on and says, oh, we're going to be, you know, 30 minutes early. We'll get you into J. We'll get you into LAX a little bit early. And I'm like, there's no way this can be true. You guys are all fudging the numbers and it turns out to be true. I love Tin Hat, Neal, when it comes to airline transportation times. All right, let's wrap it up there. Toby, it's Friday, I could definitely get on board with a two-day work week. Even four seems a bit aggressive.

Thanks for starting your day with us and have a wonderful weekend. For any questions, comments, or feedback, send an email to Morning Brew Daily at Morningbrew.com. And if you're enjoying the content coming through your ears, don't keep it to yourself and share this podcast with your friends and family. It'll give you major social credit and help us grow this thing to be even bigger. For a more specific sharing idea, here's Toby. I want you to share the podcast with someone who is doing dry January this month. Nothing like a little Neil and Toby to take the edge off in these cold January days.

Let's roll the credits. Emily Milliron is our executive producer. Raymond Loo is our producer. Olivia Graham is our associate producer. Yuchinawa Ogu is our technical director. Billy Minino is on audio. Hair and makeup is never on time. Devin Emery is our chief content officer

and our show is a production of Morning Brew. Great show today, Neil. I wish you all well. All. Pay off your home. Travel for life. Drive a Ferrari. In celebration of the world premiere of the Monopoly

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