Cramer in the Gulf of Mexico, Tesla Soars, Exclusive: Southwest CEO on Board Changes 10/24/24

David Faber (0:00)

Market insight and analysis. You're listening to the opening bell of CNBC's Squawk on the Street.

Carl Quintanilla (0:06)

Some aerial pictures from a Chevron oil rig in the Gulf of Mexico today. It's a vital region when it comes to American energy production, especially with prices at the pump at the lowest levels since February today. Good Thursday morning. welcome to Squawk on the Street. I'm Carl Quintanilla with David Faber at Post 9 of the New York Stock Exchange. Cramer is on Chevron's anchor offshore oil rig in the Gulf. A lot more from Jim in just a moment. In the meantime, futures bounce at least on the S&P after the worst session in a couple of weeks yesterday as yields retreat. Some 40 S&P companies report earnings today. Roadmap begins with Tesla, though, the biggest gainer on the S&P pre-market following those stronger than expected Q3 results. Musk with some bullish comments on the call last night.

David Faber (0:48)

Plus, Boeing shares are extending low losses from yesterday, this after the machinists of the company rejected the new labor contract proposal.

And that adds, of course, to a strike that is already five weeks long. Southwest and Elliott reach a settlement deal. The company will add six directors, five proposed by Elliott to its board. We're going to break it down with Southwest CEO Bob Jordan. That's going to be a bit later this hour.

Carl Quintanilla (1:15)

We begin, though, with Jim in the Gulf, as we said yesterday, trying to set you up, Jim, with that history of you going to rigs. This is not the first time.

Jim Cramer (1:24)

No, it's not, and I have been in the Gulf before. Of course, I've been in the Bakken. I will tell you, this is an engineering marvel. We're about 140 miles out. This is all new technology. It's very exciting. But David, I do want to say, as great as this is, Elon Musk took a shot very early on in a combustible engine. It was very effective. He called what's happening here niche, niche. And it doesn't feel niche, David, because you've been on one of these. But when you listen to Elon Musk, he did have a lot of authority on that call last night.

David Faber (1:59)

Well, the demand for oil continues unabated. I don't know, Jim, where are we in terms of daily use right now? And I'm curious as to how many barrels, by the way, that thing you're standing on is producing every year.

Jim Cramer (2:14)

Well, we'll produce 70,000 barrels. And you're right. I mean, we use a huge amount of oil. And, you know, David, it's very interesting because Chevron's rap is, it's going to be many, many years before we switch to electric. It's really funny because in Musk's call, he starts out with the idea that he's the only guy that's profitable. And then he talks about how everybody basically is going to be on EV. Maybe he just thinks that all EV will be him. But Tesla is the leader today. And I do think that as great as Chevron is, and we're obviously in the Gulf of Mexico and a beautiful place that is going to be the, I'd say the center of production, maybe even past Permian one day as Permian runs out. Yeah, look Carl, the fact is that this is an industry that desperately wants respect, no matter who is president. And the respect comes from being a good citizen in the Gulf. Respect comes from producing 14 to 15% of our energy, going higher.

So, it's a marble, but it's overshadowed by Mr. EV, Elon Musk.

Carl Quintanilla (3:16)

Although Jim, a lot of folks pointing out today, as good as the margin story was last night, CapEx is getting some attention. Adam Jonas calls that figure out of Tesla's quarter, CapEx, eye-popping 14% of sales. They're looking at 11 billion next year. And even Jonas says, look, there are long-term questions about the capital intensity of his model.

Jim Cramer (3:40)

Well, it's really incredible because he did not mention NVIDIA, but he did mention NeuroBrain. The NeuroBrain for EV is heavy, heavy. Blackwell, that is the latest version of NVIDIA. David, you know, I keep coming back to NVIDIA because when you see CapEx, that's in check from Musk to Jensen Long. And let's never forget that because his stuff is expensive and people have to pay the freight in order to be able to get to that level.

David Faber (4:09)

You know, Tesla obviously is going to be up. I mean, we can start talking about it. I guess we already have after those earnings. Jim, you seem somewhat, I don't want to put words in your mouth, so I'll let you say it. I mean, obviously it was a very strong performance in terms of margins at the automaker. We know that far above what many had anticipated. As you and Carl have alluded to already though, in many ways they used the auto business at this point to provide the cash flow for the other businesses that Mr. Musk basically says are going to send this company's value to the likes of which nothing has ever equaled in the history of mankind. What is he talking about? $30 trillion. I guess you're going to get the $30 trillion, you got to start somewhere and they're up 14 percent plus today.