This insanity was recorded in 1978 at San Francisco's Different Fur music studios as part of the dream sequence in Neil Young's film Human Highway (1982). From Shakey: Neil Young's Biography by Jimmy McDonough:
"In the wee hours of the morning at Different Fur, Young and Devo collaborated musically for the only time on an ultra-twisted version of a new song called 'Hey Hey, My My (Into the Black).' (…) 'I didn't want to sing about Johnny Rotten,' said Booji Boy's alter ego, [Mark] Mothersbaugh. 'So I changed it to Johnny Spud. And I inserted a line — 'Rust never sleeps.' The slogan (…) dated back to Devo's graphic-arts days, when they were promoting an automobile-rust-proofing outfit. 'We saw 'Rust never sleeps' as referring to corruption of innocence, de-evolution of the planet,' said Mothersbaugh. Neil Young would nick Booji Boy's impromptu mumbling both to rework the new song and for the title of his next album.
Young would interpret the line in his own way. 'It caught my ear,' Young told Mary Turner in 1979. 'I thought, 'Wow, right off they wrote better lyrics than I did. I can relate to 'Rust never sleeps.' It relates to my career. The longer I keep going, the longer I have to fight this corrosion.'"