1 00:00:00,120 --> 00:00:02,720 Speaker 1: This is Dana Perkins, and you're listening to Switch on 2 00:00:02,920 --> 00:00:05,640 Speaker 1: the B and E F podcast, and today you are 3 00:00:05,760 --> 00:00:09,200 Speaker 1: in for a double header. That's right, two recordings back 4 00:00:09,240 --> 00:00:12,360 Speaker 1: to back, both about how the transportation industry and some 5 00:00:12,480 --> 00:00:15,800 Speaker 1: of the biggest auto manufacturers are changing. In this case 6 00:00:15,880 --> 00:00:19,880 Speaker 1: Volkswagen and General Motors. They're taking big steps towards going 7 00:00:20,040 --> 00:00:23,400 Speaker 1: electric and they're not the only ones. So first, Mark 8 00:00:23,440 --> 00:00:26,439 Speaker 1: Taylor and I sit down with Colin mccarricker. He's the 9 00:00:26,440 --> 00:00:29,200 Speaker 1: head of Advanced Transport for b ANF. We talked to 10 00:00:29,280 --> 00:00:32,760 Speaker 1: him about Volkswagen and their recent announcements at their Power 11 00:00:32,880 --> 00:00:36,280 Speaker 1: Day which took place on the fifteenth of March. After that, 12 00:00:36,400 --> 00:00:41,120 Speaker 1: we sit down with Alejandro Zamarano Kadavid. Now he focuses 13 00:00:41,159 --> 00:00:43,479 Speaker 1: on intelligent mobility for us at b an EF, and 14 00:00:43,560 --> 00:00:47,599 Speaker 1: he's joined by Nicolas Solopolos, who looks at electric vehicles, 15 00:00:47,720 --> 00:00:50,720 Speaker 1: and they talk to us about General Motors and their 16 00:00:50,800 --> 00:00:54,280 Speaker 1: recent plans to pivot their business to being fully electric. 17 00:00:54,320 --> 00:00:56,720 Speaker 1: Our analyst teams have written a few pieces recently which 18 00:00:56,720 --> 00:00:59,720 Speaker 1: you might care about. Volkswagen's plan to bridge to the Tesla, 19 00:00:59,800 --> 00:01:03,640 Speaker 1: chart G gap GM to deal with electrification transition risks, 20 00:01:04,080 --> 00:01:06,360 Speaker 1: and then one from the Consumer Electronics Show at the 21 00:01:06,400 --> 00:01:10,760 Speaker 1: beginning of this year titled cs GM outlines e V 22 00:01:11,319 --> 00:01:14,319 Speaker 1: autonomy tipping points. If you want to get your hands 23 00:01:14,319 --> 00:01:16,280 Speaker 1: on them, they're available at b NF go on the 24 00:01:16,280 --> 00:01:19,920 Speaker 1: Bloomberg terminal, or via BNF dot com. As a quick reminder, 25 00:01:19,959 --> 00:01:22,360 Speaker 1: b an EF does not provide investment of strategy advice. 26 00:01:22,400 --> 00:01:24,360 Speaker 1: And we've got a complete disclaimer at the end of 27 00:01:24,400 --> 00:01:26,920 Speaker 1: the show. And now let's start the first part of 28 00:01:26,959 --> 00:01:37,280 Speaker 1: our doubleheader. Hey Colin, Hey Mark, So there was a 29 00:01:37,400 --> 00:01:41,280 Speaker 1: pretty bombshell announcement or group of announcements this week from BW. 30 00:01:41,280 --> 00:01:43,679 Speaker 1: Can you tell us a bit more about exactly what 31 00:01:43,720 --> 00:01:46,480 Speaker 1: they said? Yeah? Sure, So VW has kind of emerged 32 00:01:46,520 --> 00:01:49,440 Speaker 1: in the last few years as the established automaker or 33 00:01:49,480 --> 00:01:52,440 Speaker 1: the large established automaker who's pushing the fastest and hardest 34 00:01:52,480 --> 00:01:54,880 Speaker 1: on emobility, and a lot of the things that we're 35 00:01:54,880 --> 00:01:58,160 Speaker 1: announced at their power day this week kind of kind 36 00:01:58,160 --> 00:02:01,960 Speaker 1: of just reinforce that um. But also they highlighted some 37 00:02:02,000 --> 00:02:05,520 Speaker 1: new initiatives. So on the battery front, they're aiming to 38 00:02:05,560 --> 00:02:10,440 Speaker 1: have six battery Giga factories running in Europe by They're 39 00:02:10,440 --> 00:02:14,040 Speaker 1: also aiming to cut battery average battery pack costs by 40 00:02:14,080 --> 00:02:16,799 Speaker 1: about fifty by that date, so that's getting them well 41 00:02:16,840 --> 00:02:19,320 Speaker 1: into the point where or well passed the point I 42 00:02:19,360 --> 00:02:23,200 Speaker 1: should say where evs should be fully price competitive on 43 00:02:23,200 --> 00:02:26,880 Speaker 1: an upfront basis without subsidies with comparable internal combustion engine vehicles. 44 00:02:26,919 --> 00:02:29,160 Speaker 1: That's an important part of the announcement, just this kind 45 00:02:29,160 --> 00:02:31,880 Speaker 1: of recognition that one of the biggest automakers in the 46 00:02:31,919 --> 00:02:34,840 Speaker 1: world sees the future as electric is aiming for seventy 47 00:02:35,160 --> 00:02:37,480 Speaker 1: of all of its vehicle sales to be electric, to 48 00:02:37,520 --> 00:02:41,240 Speaker 1: be pure electric in Europe, by slightly lower amount in 49 00:02:41,320 --> 00:02:44,080 Speaker 1: China and North America. So that's a big part of 50 00:02:44,080 --> 00:02:46,840 Speaker 1: it is just seeing one of the biggest automakers say, 51 00:02:46,880 --> 00:02:49,640 Speaker 1: we're getting more and more confident in the technology that 52 00:02:49,639 --> 00:02:51,959 Speaker 1: we're going to make very big investments. And again they've 53 00:02:51,960 --> 00:02:54,040 Speaker 1: been building on some of these investments for a little while, 54 00:02:54,120 --> 00:02:56,760 Speaker 1: but this kind of crystallized something that had been happening 55 00:02:56,760 --> 00:02:58,919 Speaker 1: for a bit. And then the other thing that they're 56 00:02:58,960 --> 00:03:02,200 Speaker 1: pushing a fair bit on is now charging infrastructure. So 57 00:03:02,360 --> 00:03:06,280 Speaker 1: if you think about where are the last standing barriers 58 00:03:06,320 --> 00:03:10,119 Speaker 1: to emobility, charging infrastructure is still one of them, and 59 00:03:10,280 --> 00:03:12,120 Speaker 1: it's not a barrier for everybody. There's a lot of 60 00:03:12,120 --> 00:03:14,560 Speaker 1: people who can go electric without a build out of 61 00:03:14,560 --> 00:03:17,000 Speaker 1: public fast charging stations because they have two cars and 62 00:03:17,040 --> 00:03:19,520 Speaker 1: they have a garage at home or a driveway that 63 00:03:19,560 --> 00:03:21,359 Speaker 1: they can charge in. But if we really want to 64 00:03:21,400 --> 00:03:24,519 Speaker 1: get broad based adoption across all housing stocks, so people 65 00:03:24,520 --> 00:03:27,079 Speaker 1: who live in high rise apartments as well, and all 66 00:03:27,120 --> 00:03:29,359 Speaker 1: income levels, you are going to need a more robust 67 00:03:29,400 --> 00:03:32,680 Speaker 1: public fast charging network. And Volkswagen is really zeroing in 68 00:03:32,800 --> 00:03:34,639 Speaker 1: on that as well, saying they're going to commit almost 69 00:03:34,639 --> 00:03:38,160 Speaker 1: five hundred million dollars towards building out public charging infrastructure, 70 00:03:38,160 --> 00:03:40,520 Speaker 1: both in in China and in Europe. They didn't say 71 00:03:40,560 --> 00:03:43,240 Speaker 1: anything about the US on that front, but there's pretty 72 00:03:43,280 --> 00:03:45,960 Speaker 1: significant investments they're planning on making their I think they 73 00:03:45,960 --> 00:03:49,400 Speaker 1: said eighteen thousand public charging points in Europe by and 74 00:03:49,440 --> 00:03:51,720 Speaker 1: that's a that's actually a sizeable increase on what's there. 75 00:03:52,400 --> 00:03:55,640 Speaker 1: They also flagged in China that the user experience from 76 00:03:55,640 --> 00:03:58,480 Speaker 1: some of the current charging infrastructure isn't great and they 77 00:03:58,520 --> 00:04:01,960 Speaker 1: want to try and improve that. They highlighted that sometimes 78 00:04:01,960 --> 00:04:04,920 Speaker 1: only around thirty percent of stations are available for drivers, 79 00:04:05,160 --> 00:04:07,480 Speaker 1: given that they may be blocked by their internal combustion 80 00:04:07,480 --> 00:04:10,840 Speaker 1: engine vehicles or the station maybe offline. So the way 81 00:04:10,920 --> 00:04:13,760 Speaker 1: I saw it is them really zeroing in on what 82 00:04:13,840 --> 00:04:16,680 Speaker 1: are the last remaining barriers to more widespread adoption of 83 00:04:16,680 --> 00:04:19,360 Speaker 1: the mobility, and that's really on the battery supply side 84 00:04:19,400 --> 00:04:21,839 Speaker 1: and on the charging infrastructure side. Now, both of these 85 00:04:21,839 --> 00:04:24,800 Speaker 1: things are completely separate businesses, though when you think about it, 86 00:04:24,839 --> 00:04:28,160 Speaker 1: You've got the automotive manufacturers, then you've got the battery manufacturers, 87 00:04:28,200 --> 00:04:31,000 Speaker 1: and then you have the charging networks, at least the 88 00:04:31,000 --> 00:04:34,599 Speaker 1: public charging networks that are you know, oftentimes provided by 89 00:04:34,839 --> 00:04:38,440 Speaker 1: also third parties and different companies. So how is VW 90 00:04:38,600 --> 00:04:40,520 Speaker 1: getting this done? Are they building out all of this 91 00:04:40,760 --> 00:04:44,039 Speaker 1: internally and these are becoming fully fledged business units within 92 00:04:44,120 --> 00:04:47,440 Speaker 1: their business or are they contracting out with other companies. 93 00:04:47,640 --> 00:04:49,320 Speaker 1: I think you're going to see a mix. But what 94 00:04:49,360 --> 00:04:52,160 Speaker 1: we've seen that's a bit different from Volkswagen now is 95 00:04:52,200 --> 00:04:56,599 Speaker 1: that they are committing new significant amounts of funding. So 96 00:04:56,640 --> 00:04:59,880 Speaker 1: they're putting four hundred million euros in new funding to 97 00:05:00,000 --> 00:05:03,680 Speaker 1: awards building charging infrastructure. And they previously participated in the 98 00:05:03,720 --> 00:05:07,960 Speaker 1: Ionity network, which several European automakers and others were putting 99 00:05:08,000 --> 00:05:10,120 Speaker 1: funds into and we're building, but this is kind of 100 00:05:10,160 --> 00:05:14,200 Speaker 1: an implicit acknowledgement that that's either not going fast enough 101 00:05:14,320 --> 00:05:15,880 Speaker 1: or just isn't quite going to be enough, and they 102 00:05:15,920 --> 00:05:17,480 Speaker 1: really want to build that up on their own. Can 103 00:05:17,520 --> 00:05:19,599 Speaker 1: you describe what that is really quick? Oh? Sorry? The 104 00:05:19,600 --> 00:05:22,800 Speaker 1: Ionity network is a fast charging network that is funded 105 00:05:22,800 --> 00:05:24,960 Speaker 1: by the Europe and o e m s that drivers 106 00:05:24,960 --> 00:05:27,000 Speaker 1: of the vehicles from those o m s can use, 107 00:05:27,120 --> 00:05:29,960 Speaker 1: and each automaker is putting money into that fund to 108 00:05:30,000 --> 00:05:32,800 Speaker 1: build out that infrastructure. Third parties can use it as well, 109 00:05:32,839 --> 00:05:35,280 Speaker 1: but they pay a higher rate generally per per charge. 110 00:05:35,640 --> 00:05:38,160 Speaker 1: So it's there's there's a bit of an acknowledgement there 111 00:05:38,200 --> 00:05:41,680 Speaker 1: that that's not quite enough. There's also an acknowledgement that 112 00:05:41,720 --> 00:05:44,680 Speaker 1: Tesla still has a pretty significant advantage when it comes 113 00:05:45,080 --> 00:05:47,920 Speaker 1: to the supercharger network. A few years ago, I think 114 00:05:47,960 --> 00:05:51,000 Speaker 1: everyone sort of thought, oh, charging infrastructure will catch up 115 00:05:51,040 --> 00:05:54,080 Speaker 1: really quickly, they'll be plugs everywhere. The reality is is 116 00:05:54,120 --> 00:05:57,600 Speaker 1: that the Tesla supercharger network is still a really significant 117 00:05:57,880 --> 00:06:01,760 Speaker 1: competitive advantage that Tesla has were other automakers. The stations 118 00:06:01,800 --> 00:06:04,280 Speaker 1: are in good locations, there's usually a lot of them, 119 00:06:04,279 --> 00:06:05,920 Speaker 1: so you don't get there and find that there's two 120 00:06:05,920 --> 00:06:08,200 Speaker 1: spots and one of them is filled. There's often many, 121 00:06:08,240 --> 00:06:12,560 Speaker 1: many different um spots. They're relatively high powers, relatively fast, 122 00:06:13,080 --> 00:06:15,320 Speaker 1: and they always work, or they almost always work. They 123 00:06:15,320 --> 00:06:17,760 Speaker 1: have much higher uptime than some of the other networks. Now, 124 00:06:18,000 --> 00:06:21,239 Speaker 1: there are other good networks building building out quickly across Europe, 125 00:06:21,240 --> 00:06:23,520 Speaker 1: and there is big investments being made from groups like 126 00:06:23,600 --> 00:06:26,880 Speaker 1: BP and Shell and some electric utilities as well. But 127 00:06:26,960 --> 00:06:30,240 Speaker 1: when it comes to automakers and sort of semi proprietary networks, 128 00:06:30,440 --> 00:06:33,240 Speaker 1: Tesla does have an advantage and and seeing VW push 129 00:06:33,240 --> 00:06:35,479 Speaker 1: money into that is kind of an acknowledgement that that 130 00:06:35,560 --> 00:06:37,480 Speaker 1: strategy is working for Tesla and for them to kind 131 00:06:37,480 --> 00:06:39,880 Speaker 1: of really keep up, they probably need to do that too. 132 00:06:40,080 --> 00:06:41,800 Speaker 1: For me, this seems to really hack at the roots 133 00:06:41,839 --> 00:06:44,120 Speaker 1: of the problem, right. So, I mean, I wasn't gonna 134 00:06:44,120 --> 00:06:45,680 Speaker 1: mention this, but but I was in the market for 135 00:06:45,680 --> 00:06:48,400 Speaker 1: a car last year, you know, and I wanted to 136 00:06:48,440 --> 00:06:51,760 Speaker 1: buy an electric you know EV, but I didn't. I 137 00:06:51,800 --> 00:06:55,320 Speaker 1: didn't because I kept saying, you know, once the once 138 00:06:55,360 --> 00:06:57,479 Speaker 1: the charging network is there, I'll get one. This seems 139 00:06:57,520 --> 00:06:59,560 Speaker 1: to be really solving the problem. But that brings me 140 00:06:59,600 --> 00:07:02,840 Speaker 1: to my of the timing of this. Is it really 141 00:07:02,960 --> 00:07:06,880 Speaker 1: driven by you know, have charging network will sell cars 142 00:07:07,240 --> 00:07:10,080 Speaker 1: or is there some element to it of being pushed 143 00:07:10,080 --> 00:07:12,440 Speaker 1: by the EU perhaps for stimulus money, or is there 144 00:07:12,440 --> 00:07:14,320 Speaker 1: some of their external force driving them to do this 145 00:07:14,440 --> 00:07:16,960 Speaker 1: right now? Yeah, there is an external force. And actually 146 00:07:17,160 --> 00:07:18,840 Speaker 1: I got to give a lot of credit to Volkswagen 147 00:07:18,920 --> 00:07:21,320 Speaker 1: when you when you see Dice talk on stage, he's 148 00:07:21,320 --> 00:07:24,000 Speaker 1: pretty open that the regulations are pushing them in this direction. 149 00:07:24,360 --> 00:07:26,200 Speaker 1: And it's no surprise that a lot of the focus 150 00:07:26,280 --> 00:07:28,800 Speaker 1: is actually on China and on Europe because that's where 151 00:07:28,800 --> 00:07:31,920 Speaker 1: the strongest regulatory pushes. And so the kind of backdrop 152 00:07:31,960 --> 00:07:34,600 Speaker 1: that everyone has to understand in Europe is that sales 153 00:07:34,720 --> 00:07:38,040 Speaker 1: of evs really spiked in that's really because that's the 154 00:07:38,040 --> 00:07:40,960 Speaker 1: first year where automakers had to meet these much tighter 155 00:07:41,000 --> 00:07:43,400 Speaker 1: new vehicle CEO two standards. So they're framed in terms 156 00:07:43,440 --> 00:07:45,840 Speaker 1: of the grams of c O two emitted per kilometer driven, 157 00:07:46,040 --> 00:07:47,920 Speaker 1: and you try to maker has to has to get 158 00:07:47,960 --> 00:07:49,840 Speaker 1: their average below the target or they pay a certain 159 00:07:49,840 --> 00:07:52,400 Speaker 1: amount of fines. And Volkswagen almost made it last year, 160 00:07:52,400 --> 00:07:54,400 Speaker 1: but they didn't make it um and they paid some 161 00:07:54,400 --> 00:07:56,480 Speaker 1: they're probably gonna pay someone around two hundred million euros 162 00:07:56,520 --> 00:07:58,880 Speaker 1: and fines probably a little higher, and that's considered a 163 00:07:58,880 --> 00:08:00,920 Speaker 1: small fine. Like the the fines that many of them 164 00:08:00,960 --> 00:08:03,120 Speaker 1: were looking at before they ramped up their ev sales 165 00:08:03,160 --> 00:08:05,880 Speaker 1: would have been in the billions of dollars, So that 166 00:08:06,040 --> 00:08:09,600 Speaker 1: regulatory push meant a lot of them actually in some 167 00:08:09,680 --> 00:08:11,480 Speaker 1: ways built up their order book a little bit in 168 00:08:11,480 --> 00:08:14,200 Speaker 1: twenty nineteen and pushed orders from twenty nineteen and new 169 00:08:14,280 --> 00:08:17,440 Speaker 1: vehicle launches into which is why then the numbers went 170 00:08:17,480 --> 00:08:20,760 Speaker 1: way way up in because there was a very very 171 00:08:20,760 --> 00:08:23,520 Speaker 1: strong legislative reason to do that in Europe, and Dice 172 00:08:23,640 --> 00:08:26,360 Speaker 1: is quite clear. Volkswagen is quite clear that they see 173 00:08:26,360 --> 00:08:28,800 Speaker 1: those tightening further and we at b an EFC those 174 00:08:28,800 --> 00:08:32,080 Speaker 1: tightening significantly further as well in in the next few years, 175 00:08:32,400 --> 00:08:34,120 Speaker 1: and that that's a big driver for what they're doing. 176 00:08:34,200 --> 00:08:37,200 Speaker 1: So one of the things we're expecting is that this 177 00:08:37,240 --> 00:08:39,480 Speaker 1: summer the European Commission is probably going to announce a 178 00:08:39,520 --> 00:08:42,720 Speaker 1: revised twenty thirty automotive CEO to target for the region, 179 00:08:43,080 --> 00:08:45,520 Speaker 1: and that's going to take the reduction the reduction in 180 00:08:45,520 --> 00:08:48,160 Speaker 1: grams the CEO two perclometer required for vehicle sold in 181 00:08:48,200 --> 00:08:51,360 Speaker 1: the block to go from what's previously said as a 182 00:08:51,440 --> 00:08:55,319 Speaker 1: thirty seven and a half percent reduction from we think 183 00:08:55,320 --> 00:08:58,080 Speaker 1: it's probably gonna go to fifty percent reduction. And once 184 00:08:58,080 --> 00:08:59,800 Speaker 1: you start to play that through and look at all 185 00:08:59,800 --> 00:09:03,800 Speaker 1: the vehicles and the technologies available, uh, that probably means 186 00:09:03,840 --> 00:09:07,480 Speaker 1: that over fifty of all vehicle sales in Europe probably 187 00:09:07,520 --> 00:09:10,040 Speaker 1: need to be electric vehicles of some form. They could 188 00:09:10,040 --> 00:09:12,040 Speaker 1: be plug in hybrids or battery electrics, and the mix 189 00:09:12,080 --> 00:09:14,640 Speaker 1: will be different for different automakers, but they probably need 190 00:09:14,679 --> 00:09:17,920 Speaker 1: to be over fifty of sales by So a lot 191 00:09:17,920 --> 00:09:20,560 Speaker 1: of what you're seeing right now is just automakers recognizing 192 00:09:20,600 --> 00:09:23,560 Speaker 1: that that's coming. So it's better to get out in 193 00:09:23,559 --> 00:09:25,640 Speaker 1: front of it and make a proactive announcement than make 194 00:09:25,640 --> 00:09:27,880 Speaker 1: a reactive one after the regulator says we're pushing in 195 00:09:28,280 --> 00:09:31,360 Speaker 1: this direction. That's not to take anything away from VW here, though, 196 00:09:31,360 --> 00:09:33,800 Speaker 1: because I think they are are genuinely leading this amongst 197 00:09:33,880 --> 00:09:36,880 Speaker 1: large automakers and they are making a very real push here. 198 00:09:37,080 --> 00:09:38,880 Speaker 1: So we'd be remiss not to point out, though that 199 00:09:39,040 --> 00:09:41,760 Speaker 1: auto sales are down, Is this really the right time 200 00:09:41,800 --> 00:09:44,800 Speaker 1: to be changing your business strategy? Never let a good 201 00:09:44,840 --> 00:09:47,560 Speaker 1: crisis go to waste right, And I think v W 202 00:09:47,840 --> 00:09:50,719 Speaker 1: would would say very clearly that actually the diesel gate 203 00:09:50,760 --> 00:09:52,880 Speaker 1: crisis was the catalyst for them doing a lot of this. 204 00:09:53,280 --> 00:09:54,920 Speaker 1: And at B and F we put out something right 205 00:09:54,960 --> 00:09:58,079 Speaker 1: after it happened saying this could be a significant fire 206 00:09:58,160 --> 00:10:01,800 Speaker 1: under VW tow two and that makes them change their 207 00:10:01,800 --> 00:10:04,800 Speaker 1: their approach. And Um, I think when it shortly after 208 00:10:04,800 --> 00:10:06,920 Speaker 1: it happened, I tweeted this out saying, they're now my 209 00:10:07,040 --> 00:10:09,280 Speaker 1: sort of dark horse bat not not very much of 210 00:10:09,280 --> 00:10:12,120 Speaker 1: a dark horse anymore, but to lead the EV market 211 00:10:12,160 --> 00:10:14,040 Speaker 1: in the early twenties. And and and that's that's what's going 212 00:10:14,080 --> 00:10:17,920 Speaker 1: to happen. Um, And I think we're seeing, we're seeing 213 00:10:18,000 --> 00:10:21,640 Speaker 1: that those decisions that were made several years ago. Things 214 00:10:21,640 --> 00:10:23,959 Speaker 1: in the auto industry take a while, products, life cycles 215 00:10:24,000 --> 00:10:27,199 Speaker 1: take a while. We're seeing all those really coming out 216 00:10:27,280 --> 00:10:30,080 Speaker 1: right now with VW strategy. So Colin, can you wrap 217 00:10:30,120 --> 00:10:31,760 Speaker 1: this a bit for us? We can hit it later 218 00:10:31,840 --> 00:10:35,000 Speaker 1: in future episodes, but for for now, what does this mean? 219 00:10:35,440 --> 00:10:37,920 Speaker 1: So we've heard announcements from other automakers, will hear in 220 00:10:38,040 --> 00:10:40,360 Speaker 1: another interview with Danta and two of our other colleagues 221 00:10:40,400 --> 00:10:43,040 Speaker 1: about GM's announcement, but what's next? What does it all 222 00:10:43,160 --> 00:10:45,480 Speaker 1: mean for the auto sector. This is a big moment 223 00:10:45,640 --> 00:10:48,199 Speaker 1: for for the auto sector. At the NEF, we've been 224 00:10:48,200 --> 00:10:51,240 Speaker 1: saying for several years now that we think sales of 225 00:10:51,280 --> 00:10:54,920 Speaker 1: internal combustion engine vehicles in the passenger vehicle segment anyway 226 00:10:55,000 --> 00:10:58,200 Speaker 1: probably peaked in two thousand, seventeen and eighteen, and that 227 00:10:58,400 --> 00:11:01,440 Speaker 1: they're actually in permanent to claw mine. Now. Um, that's 228 00:11:01,480 --> 00:11:04,319 Speaker 1: always a pretty uncomfortable thing to call, because peaks when 229 00:11:04,320 --> 00:11:05,839 Speaker 1: you get them, when you call them wrong, you look 230 00:11:05,840 --> 00:11:09,120 Speaker 1: really silly. But more and more we're feeling more confident 231 00:11:09,320 --> 00:11:12,000 Speaker 1: that that we were right to call that. And now 232 00:11:12,080 --> 00:11:14,800 Speaker 1: you have the largest, one of the largest automakers in 233 00:11:14,840 --> 00:11:18,120 Speaker 1: the world saying on no uncertain terms they've been hinting 234 00:11:18,120 --> 00:11:20,360 Speaker 1: at this for a while, but saying in really really 235 00:11:20,360 --> 00:11:23,400 Speaker 1: clear terms that their future is electric. I think that 236 00:11:23,480 --> 00:11:26,120 Speaker 1: really matters because if you're working at any other major 237 00:11:26,120 --> 00:11:29,120 Speaker 1: automaker right now, you're going back and saying, well, look, 238 00:11:29,240 --> 00:11:31,960 Speaker 1: VW is going in pretty hard, what's what's our plan? 239 00:11:32,600 --> 00:11:35,080 Speaker 1: And if you work at VW, you have a very 240 00:11:35,120 --> 00:11:39,120 Speaker 1: clear sense of mission and having worked with the strategy 241 00:11:39,160 --> 00:11:41,920 Speaker 1: teams of a lot of different automakers, and oil and 242 00:11:41,960 --> 00:11:46,200 Speaker 1: gas companies and utilities over the years. Clarity of mission 243 00:11:46,360 --> 00:11:50,199 Speaker 1: really really matters for people's motivation, So I wouldn't underestimate 244 00:11:50,640 --> 00:11:53,200 Speaker 1: just how powerful that is too. If somebody feels like 245 00:11:53,200 --> 00:11:55,280 Speaker 1: we're sort of trying to do both things at the 246 00:11:55,320 --> 00:11:57,400 Speaker 1: same time and dragging something through the mud or the 247 00:11:57,440 --> 00:12:01,079 Speaker 1: strategies a bit muddled, it's harder to rally the troops. 248 00:12:01,200 --> 00:12:03,320 Speaker 1: But if you've got a really clear message, you can 249 00:12:03,400 --> 00:12:05,199 Speaker 1: rally the troops better, you can get things done, you 250 00:12:05,240 --> 00:12:08,120 Speaker 1: can get people really motivated. And and again I wouldn't 251 00:12:08,240 --> 00:12:12,360 Speaker 1: discount the importance of that part of this announcement too well. 252 00:12:12,360 --> 00:12:15,080 Speaker 1: And on that note, speaking of clear mission, stay with 253 00:12:15,200 --> 00:12:17,280 Speaker 1: us because after this we're going to be hearing all 254 00:12:17,320 --> 00:12:21,520 Speaker 1: about General Motors or GM. With my colleagues Alejandro and Nicholas. 255 00:12:21,559 --> 00:12:24,480 Speaker 1: We'll hear about their plans for electric vehicles in the future. 256 00:12:24,760 --> 00:12:31,840 Speaker 1: Now for a very short break, stay with us. Hi, Ali, 257 00:12:31,880 --> 00:12:34,040 Speaker 1: thank you for joining us today. Thank you, Dana, how 258 00:12:34,040 --> 00:12:37,040 Speaker 1: are you? I'm really good And Nicholas, thank you for 259 00:12:37,120 --> 00:12:40,400 Speaker 1: joining Hello, Dinna, thanks for inviting me, and it's good 260 00:12:40,400 --> 00:12:43,560 Speaker 1: to be here. So we're here today to talk about GM, 261 00:12:43,679 --> 00:12:47,440 Speaker 1: General Motors and they have made a pretty big commitment. 262 00:12:47,520 --> 00:12:50,200 Speaker 1: So let's start at the beginning and let's understand what 263 00:12:50,240 --> 00:12:52,480 Speaker 1: it is that they have come out recently. Instead, So 264 00:12:52,679 --> 00:12:55,880 Speaker 1: GM came out with a sustainability plan in order to 265 00:12:55,920 --> 00:12:59,680 Speaker 1: become a net zero company by and that implies that 266 00:12:59,760 --> 00:13:04,040 Speaker 1: has intermediate step there by thirty five to only sell 267 00:13:04,679 --> 00:13:07,040 Speaker 1: vehicles that do not produce any emission. That is of 268 00:13:07,080 --> 00:13:09,199 Speaker 1: course an aspiration, and they have made it very clear 269 00:13:09,480 --> 00:13:12,560 Speaker 1: that they aspire to that goal run than targeting to 270 00:13:12,679 --> 00:13:15,760 Speaker 1: only sell bavs, but electric vehicles by by that time. 271 00:13:15,920 --> 00:13:18,400 Speaker 1: Their pledge of becoming a net zero company by twenty 272 00:13:18,480 --> 00:13:23,160 Speaker 1: four includes all emission Scope one, two and three emissions 273 00:13:23,160 --> 00:13:26,520 Speaker 1: that the company generates through its own operations, but also 274 00:13:26,840 --> 00:13:29,480 Speaker 1: through its supply chain and through their products that itself 275 00:13:29,559 --> 00:13:32,360 Speaker 1: to its customers. This is pretty unusual, is it not 276 00:13:32,520 --> 00:13:35,840 Speaker 1: for a auto manufacturer to target scope three emissions? And 277 00:13:35,920 --> 00:13:39,360 Speaker 1: are there any other auto manufacturers you've done this? There 278 00:13:39,400 --> 00:13:43,000 Speaker 1: have been a few more, in fact, for the Dime 279 00:13:43,080 --> 00:13:46,480 Speaker 1: Learningsan have done that. I think volt Lagon as well. However, 280 00:13:46,679 --> 00:13:51,960 Speaker 1: no manufactured to date has made an explicit statement about 281 00:13:52,280 --> 00:13:56,360 Speaker 1: only selling zero emission vehicles by a given date. So 282 00:13:56,720 --> 00:13:59,440 Speaker 1: all other manufacturers have left that point a little bit vague. 283 00:13:59,679 --> 00:14:02,200 Speaker 1: Where JEM is, as far as I can tell, the only, 284 00:14:02,280 --> 00:14:05,360 Speaker 1: the first and only until now manufacturer who says that 285 00:14:05,440 --> 00:14:09,000 Speaker 1: by five they aspire at least to only be selling 286 00:14:09,240 --> 00:14:13,360 Speaker 1: bottery electric vehicles. And that's for their global sales of cars, 287 00:14:13,559 --> 00:14:16,560 Speaker 1: including in their two biggest markets, one being the US, 288 00:14:16,640 --> 00:14:19,040 Speaker 1: the second one being China. So let's talk about this 289 00:14:19,120 --> 00:14:22,200 Speaker 1: from the US perspective really quickly, because I must admit 290 00:14:22,240 --> 00:14:24,280 Speaker 1: I really did not see this coming. When I think 291 00:14:24,320 --> 00:14:26,800 Speaker 1: of GM, I'm thinking of like a big truck out 292 00:14:26,920 --> 00:14:30,200 Speaker 1: on maybe during the Super Bowl or something else like that, 293 00:14:30,240 --> 00:14:33,800 Speaker 1: where you know, trucks are tough. Have they been looking 294 00:14:33,840 --> 00:14:36,200 Speaker 1: at this for some time? And is this actually a 295 00:14:36,240 --> 00:14:39,440 Speaker 1: really natural progression of their business model? Are they starting 296 00:14:39,600 --> 00:14:41,840 Speaker 1: to look at this from pretty much a standing start? 297 00:14:42,200 --> 00:14:46,120 Speaker 1: So GM has been investing in evs in electric vehicles 298 00:14:46,200 --> 00:14:48,360 Speaker 1: for for quite some time. They have come out with 299 00:14:48,400 --> 00:14:52,640 Speaker 1: the Vault, the Range extend, the Vault in twelve with 300 00:14:52,800 --> 00:14:57,880 Speaker 1: the all electric Botty Electric volt in. We have some 301 00:14:58,000 --> 00:15:00,960 Speaker 1: history in UH investing in the IS. In the last 302 00:15:00,960 --> 00:15:03,520 Speaker 1: couple of years, they have also been been building from 303 00:15:03,520 --> 00:15:06,600 Speaker 1: the ground up quite advanced electrification technology in what they 304 00:15:06,640 --> 00:15:09,600 Speaker 1: call the ultimate battery platform, and we can go into 305 00:15:09,600 --> 00:15:12,480 Speaker 1: some more detail on that later on. They have been 306 00:15:12,520 --> 00:15:15,280 Speaker 1: investing on that. They plan to invest about twenty seven 307 00:15:15,320 --> 00:15:22,280 Speaker 1: billion dollars until twenty five between now on electrification R 308 00:15:22,360 --> 00:15:25,400 Speaker 1: and D and capital expenditure. They will spend quite a 309 00:15:25,400 --> 00:15:29,160 Speaker 1: bit of money on on evs. However, in terms of 310 00:15:29,200 --> 00:15:31,840 Speaker 1: their sales and what they have done until now on 311 00:15:32,080 --> 00:15:36,160 Speaker 1: electrification and selling battery electric cars, they haven't done great, 312 00:15:36,360 --> 00:15:41,440 Speaker 1: but their production volume is somehow low, there behind some 313 00:15:41,520 --> 00:15:44,680 Speaker 1: of the other automakers that are selling pottery electric vehicles, 314 00:15:44,680 --> 00:15:48,000 Speaker 1: either in the US or globally. And there is of 315 00:15:48,040 --> 00:15:53,680 Speaker 1: course this undercurrent of their recent lobbying and regulatory activities 316 00:15:53,880 --> 00:15:56,800 Speaker 1: or the activity around the regulations, primarily in the US. 317 00:15:56,840 --> 00:16:00,680 Speaker 1: So up until two weeks after the action, I believe 318 00:16:01,240 --> 00:16:04,320 Speaker 1: it is the U S election back in November, they 319 00:16:04,320 --> 00:16:07,520 Speaker 1: had sided with the previous administration in trying to do 320 00:16:07,520 --> 00:16:10,680 Speaker 1: two things. First of all, to revoke California's a waiver 321 00:16:11,080 --> 00:16:15,600 Speaker 1: in setting its own more stringent environmental emissions rules as 322 00:16:15,600 --> 00:16:20,040 Speaker 1: it pertains to passenger vehicles, and they were also lobbying 323 00:16:20,360 --> 00:16:24,880 Speaker 1: in favor of the more lax federal fuel efficiency standards 324 00:16:24,880 --> 00:16:29,120 Speaker 1: that the Trump administration had put forward. So they changed 325 00:16:29,160 --> 00:16:33,720 Speaker 1: their their view literally after the election results. So they've 326 00:16:33,800 --> 00:16:37,840 Speaker 1: changed their view. So other manufacturers have as well, then, yeah, exactly, 327 00:16:38,120 --> 00:16:40,920 Speaker 1: So they have changed their view quite recently and quite abruptly. 328 00:16:40,920 --> 00:16:44,400 Speaker 1: In fact, they followed other manufacturers that did the same 329 00:16:44,440 --> 00:16:47,920 Speaker 1: since the election or around the election. However, there were 330 00:16:48,160 --> 00:16:51,600 Speaker 1: a group of manufacturers even since twenty eighteen and twenty 331 00:16:51,680 --> 00:16:54,920 Speaker 1: nineteen that they had sided with California to follow stricter 332 00:16:55,160 --> 00:16:58,200 Speaker 1: emissions rules in the US and the different to the 333 00:16:58,240 --> 00:17:00,840 Speaker 1: ones that to the more relaxed rules that the Trump 334 00:17:00,840 --> 00:17:03,800 Speaker 1: administration had put forward. So there was some sort of 335 00:17:04,160 --> 00:17:09,320 Speaker 1: regulatory driven reaction from GM side in order to make 336 00:17:09,359 --> 00:17:11,480 Speaker 1: this announcement now, or that's what I believe, and that's 337 00:17:11,480 --> 00:17:14,960 Speaker 1: what I see from their recent actions in the last 338 00:17:14,960 --> 00:17:18,080 Speaker 1: couple of years. Having said that, they have been developing 339 00:17:18,080 --> 00:17:22,199 Speaker 1: and they continue to develop quite advanced electrification technologies to 340 00:17:22,280 --> 00:17:25,320 Speaker 1: allow them or take them forward and to allow them 341 00:17:25,359 --> 00:17:28,640 Speaker 1: to meet those aspirations that they have for thirty five 342 00:17:29,000 --> 00:17:30,880 Speaker 1: So it's fair to say that you think that this 343 00:17:30,920 --> 00:17:33,760 Speaker 1: is in some respect politically driven, given that the other 344 00:17:34,000 --> 00:17:36,760 Speaker 1: major market that they will sell in is China, and 345 00:17:36,880 --> 00:17:39,320 Speaker 1: China now has an zero target as well. Is that 346 00:17:39,359 --> 00:17:41,359 Speaker 1: a fair assertion, Well, it is. I think it's a 347 00:17:41,400 --> 00:17:44,520 Speaker 1: realization that most of the makers are coming to at 348 00:17:44,520 --> 00:17:46,960 Speaker 1: the moment. That is that as you look at those 349 00:17:47,160 --> 00:17:51,000 Speaker 1: net zero targets in China, in Europe, the US doesn't 350 00:17:51,000 --> 00:17:54,359 Speaker 1: have one at least yet, what automakers are doing is 351 00:17:54,400 --> 00:17:57,439 Speaker 1: they're working backwards from those. So and that's your target 352 00:17:57,480 --> 00:18:01,560 Speaker 1: in twenty fifty. For example, if assume a car lifetime 353 00:18:01,600 --> 00:18:04,840 Speaker 1: of twelve to fifteen years, means that by about the 354 00:18:04,880 --> 00:18:08,160 Speaker 1: mid of the twenty thirties, automakers will have to sell 355 00:18:09,080 --> 00:18:12,800 Speaker 1: zero mission vehicles in order to meet those next jar 356 00:18:12,840 --> 00:18:15,719 Speaker 1: targets in the different markets where they operate. So in 357 00:18:15,760 --> 00:18:20,440 Speaker 1: this case it is definitely politically driven. Automakers practically are 358 00:18:20,480 --> 00:18:23,560 Speaker 1: looking at ways now to try and meet those long 359 00:18:23,680 --> 00:18:26,200 Speaker 1: term targets. Well, and so you referenced at the beginning 360 00:18:26,200 --> 00:18:27,879 Speaker 1: of the podcast that they're going to be putting a 361 00:18:27,880 --> 00:18:29,520 Speaker 1: lot of R and D money into this and that 362 00:18:29,520 --> 00:18:32,680 Speaker 1: they're going to have to pivot in terms of how 363 00:18:32,720 --> 00:18:35,320 Speaker 1: they're spending their money, time and brain power. Now I 364 00:18:35,359 --> 00:18:37,879 Speaker 1: don't think this however, naively, it has been said to 365 00:18:37,880 --> 00:18:41,320 Speaker 1: me in the past. Aren't battery electric vehicles? If you're 366 00:18:41,320 --> 00:18:43,720 Speaker 1: looking at them, somebody else is making the battery and 367 00:18:43,800 --> 00:18:46,719 Speaker 1: you're only making the casing. So how hard is that 368 00:18:46,760 --> 00:18:49,520 Speaker 1: as a manufacturer to really pivot to a battery electric vehicle? 369 00:18:49,800 --> 00:18:52,000 Speaker 1: And I think a hunter, you've been following the Consumer 370 00:18:52,040 --> 00:18:54,080 Speaker 1: Electronics Show and you really look at a lot of 371 00:18:54,119 --> 00:18:57,640 Speaker 1: these technology advancements that go into these vehicles, and there's 372 00:18:57,680 --> 00:19:00,199 Speaker 1: so much more than just batteries. So what is is 373 00:19:00,240 --> 00:19:03,600 Speaker 1: mean from an R and D investment standpoint? And you know, 374 00:19:03,640 --> 00:19:05,080 Speaker 1: what are we looking at in terms of what are 375 00:19:05,080 --> 00:19:06,880 Speaker 1: they going to be investing in and how are things 376 00:19:06,920 --> 00:19:10,960 Speaker 1: going to potentially change for their business. It's a great point, 377 00:19:11,080 --> 00:19:13,520 Speaker 1: and I actually have a couple of counterpoints. So what 378 00:19:13,600 --> 00:19:17,000 Speaker 1: Nicholas just said, and I do think GM's decision is 379 00:19:17,080 --> 00:19:20,560 Speaker 1: quite motivated by policy and by the change in president 380 00:19:20,680 --> 00:19:23,360 Speaker 1: in the US, and I think that says a lot 381 00:19:23,400 --> 00:19:27,320 Speaker 1: about how, at least I personally interpret their plans. And 382 00:19:27,320 --> 00:19:28,960 Speaker 1: we can talk a little bit more about it later, 383 00:19:29,400 --> 00:19:31,679 Speaker 1: but it relates a lot to how they plan to 384 00:19:31,680 --> 00:19:35,200 Speaker 1: monetize their EV platform, which is based on their old 385 00:19:35,240 --> 00:19:39,440 Speaker 1: Tium technology. But in general, car companies have been facing 386 00:19:39,480 --> 00:19:43,040 Speaker 1: for the last five years more or less an existential 387 00:19:43,080 --> 00:19:48,520 Speaker 1: crisis where two historical rates trends that benefit them are 388 00:19:48,600 --> 00:19:53,560 Speaker 1: changing significantly. Those were urbanization, which meant people were moving 389 00:19:53,600 --> 00:19:56,639 Speaker 1: to cities, and they were motorization, which meant people were 390 00:19:56,680 --> 00:19:59,800 Speaker 1: buying more cars. And those trends have disconnected in the 391 00:20:00,000 --> 00:20:03,000 Speaker 1: a few years and now people are still moving to cities, 392 00:20:03,080 --> 00:20:06,359 Speaker 1: but people don't want to own cars, and that means 393 00:20:06,440 --> 00:20:10,280 Speaker 1: that we could see a peak in new personal car 394 00:20:10,400 --> 00:20:14,800 Speaker 1: sales much sooner than anybody else expected. And that has determined, 395 00:20:15,040 --> 00:20:17,760 Speaker 1: in our view, a lot of how they spend every 396 00:20:17,760 --> 00:20:19,840 Speaker 1: book they spent on R and D, and that has 397 00:20:19,840 --> 00:20:24,440 Speaker 1: determined the investments they've done around novel ways of using cars, 398 00:20:24,480 --> 00:20:27,480 Speaker 1: like those who offered by share mobility services and those 399 00:20:27,600 --> 00:20:31,159 Speaker 1: offered by right hailing services like Uber and Lift, et cetera. 400 00:20:32,480 --> 00:20:34,639 Speaker 1: And you know now that the DOST has set a 401 00:20:34,640 --> 00:20:37,960 Speaker 1: little bit, and COVID nineteen helped settle that DOST a bit, 402 00:20:38,040 --> 00:20:40,639 Speaker 1: because you know, the market cut offered for pretty much 403 00:20:40,640 --> 00:20:44,080 Speaker 1: all the different offerings they have been investing on. We've 404 00:20:44,119 --> 00:20:46,160 Speaker 1: seen a little bit of a pullback from the car 405 00:20:46,240 --> 00:20:51,919 Speaker 1: companies away from over investing especially on shared mobility services, 406 00:20:51,960 --> 00:20:54,679 Speaker 1: and we we think that that seems to be a 407 00:20:54,720 --> 00:20:58,040 Speaker 1: trend that is picking up. It began last year with 408 00:20:58,200 --> 00:21:01,040 Speaker 1: BMW and Diamler, which we're you know, one of the 409 00:21:01,160 --> 00:21:05,040 Speaker 1: key innovators when it came to building fully connected strategy 410 00:21:05,280 --> 00:21:08,560 Speaker 1: that included out the most vehicles connected services, electric vehicles, 411 00:21:08,560 --> 00:21:12,720 Speaker 1: and shares services, and they have both made significant changes 412 00:21:12,760 --> 00:21:15,399 Speaker 1: to those strategies. Timer has a new CEO. The new 413 00:21:15,480 --> 00:21:19,639 Speaker 1: CEO wants to focus on making money, not on on 414 00:21:19,720 --> 00:21:22,560 Speaker 1: low volumes rather than trying to sell a lot of cars, 415 00:21:22,600 --> 00:21:26,040 Speaker 1: which was the previous CEOs idea, and they're dropping a 416 00:21:26,040 --> 00:21:29,919 Speaker 1: lot of investments on share mobility and on right healing services. 417 00:21:30,080 --> 00:21:33,639 Speaker 1: So I think that by not having to spend money 418 00:21:33,640 --> 00:21:35,960 Speaker 1: on that all of a sudden, these car companies have 419 00:21:36,040 --> 00:21:38,360 Speaker 1: more money to spend on other things that they see 420 00:21:38,400 --> 00:21:41,560 Speaker 1: more potential for their bottom line in the long term. 421 00:21:41,600 --> 00:21:44,919 Speaker 1: And I think that's where evs come in, and I 422 00:21:44,960 --> 00:21:48,320 Speaker 1: think that's where you know GM's latest announcements around d VS. 423 00:21:48,640 --> 00:21:51,920 Speaker 1: So to touch upon a point that Nico made about 424 00:21:52,119 --> 00:21:56,960 Speaker 1: the political motivations behind GMS announcements, I think it would 425 00:21:56,960 --> 00:22:00,320 Speaker 1: be naive to believe that it was a coincidence that 426 00:22:00,400 --> 00:22:05,959 Speaker 1: they launched this new Ultimum Ultimate platform at CS. They 427 00:22:06,000 --> 00:22:08,720 Speaker 1: didn't they re launched it because they already launched it before, 428 00:22:08,720 --> 00:22:10,840 Speaker 1: but they relaunched it and they clarified their long terms 429 00:22:10,880 --> 00:22:13,560 Speaker 1: already at CES, and then they launched this new plan 430 00:22:13,640 --> 00:22:17,159 Speaker 1: to stop selling cars with tail pipe emissions by a 431 00:22:17,240 --> 00:22:21,280 Speaker 1: few weeks later. Um that it coincided with the change 432 00:22:21,280 --> 00:22:24,840 Speaker 1: in in the federal administration in the US, when for 433 00:22:24,960 --> 00:22:28,760 Speaker 1: the past four years they were for all purposes fighting 434 00:22:28,920 --> 00:22:34,520 Speaker 1: anything that made them go make electric vehicles, as Nico explained. 435 00:22:35,400 --> 00:22:38,600 Speaker 1: So I would like to see if they actually go 436 00:22:38,640 --> 00:22:42,640 Speaker 1: ahead and execute those plans. It seems like they're investing 437 00:22:42,760 --> 00:22:46,520 Speaker 1: lesson on new technologies around shared mobility, which could mean 438 00:22:46,520 --> 00:22:48,760 Speaker 1: that they have more cash to spend on their new 439 00:22:48,800 --> 00:22:53,920 Speaker 1: EV plans. But I think it's still quite soon too 440 00:22:54,119 --> 00:22:58,200 Speaker 1: to conclude that the decision to to launch this this 441 00:22:58,359 --> 00:23:02,359 Speaker 1: new pledge or jective has nothing to do with with 442 00:23:02,400 --> 00:23:05,160 Speaker 1: politics or is not that called closely related to politics. 443 00:23:05,200 --> 00:23:08,560 Speaker 1: And I think that makes it extremely vulnerable because as 444 00:23:08,600 --> 00:23:12,520 Speaker 1: we saw in four years alone, the Trump administration basically 445 00:23:13,280 --> 00:23:17,080 Speaker 1: got rid of the stringent portion of the fuel efficiency standards. 446 00:23:17,560 --> 00:23:20,479 Speaker 1: So it is very susceptible to whomever is in the 447 00:23:20,480 --> 00:23:23,360 Speaker 1: White House the regulation that is supposed to drive electrification 448 00:23:23,359 --> 00:23:26,960 Speaker 1: in the US. So if you're going to flip flop 449 00:23:27,000 --> 00:23:29,520 Speaker 1: every four years, if there's a change in the White House, 450 00:23:30,119 --> 00:23:34,000 Speaker 1: then you know, those long term plans become quite vulnerable. 451 00:23:34,240 --> 00:23:37,040 Speaker 1: I think there's a counterpoint to counter argument to this 452 00:23:37,080 --> 00:23:39,240 Speaker 1: one in the sense that there is a point of 453 00:23:39,440 --> 00:23:41,919 Speaker 1: no return, and to what I mean by that. You 454 00:23:42,000 --> 00:23:45,159 Speaker 1: could go back and forth in the electrification plans, or 455 00:23:45,240 --> 00:23:47,639 Speaker 1: you could have gone back and forth and electrification plans 456 00:23:47,680 --> 00:23:50,679 Speaker 1: up until one to two years ago when investments were 457 00:23:50,680 --> 00:23:55,080 Speaker 1: relatively low. But if GM goes through with its plan 458 00:23:55,160 --> 00:24:00,280 Speaker 1: and invests seven billion dollars, that means that they have 459 00:24:00,440 --> 00:24:03,560 Speaker 1: to do something with the technology that they have developed 460 00:24:03,640 --> 00:24:07,400 Speaker 1: until then, which means that even if the administration changes 461 00:24:07,440 --> 00:24:10,920 Speaker 1: and even the environmental thows change and the emission targets 462 00:24:11,200 --> 00:24:14,720 Speaker 1: are relaxed, GM and other to makers that have made 463 00:24:14,720 --> 00:24:18,480 Speaker 1: those investments will have to start building and selling electric 464 00:24:18,480 --> 00:24:22,000 Speaker 1: cars in order to recoup the very high upfront cost 465 00:24:22,040 --> 00:24:24,080 Speaker 1: that they have made. So there is of course this 466 00:24:24,480 --> 00:24:29,080 Speaker 1: political elements going back and forth and siding with the 467 00:24:29,080 --> 00:24:32,200 Speaker 1: current winds in the in the capital the capital cities. 468 00:24:32,720 --> 00:24:35,520 Speaker 1: But at the same time, the more that goes a 469 00:24:35,560 --> 00:24:38,960 Speaker 1: lot that goes on, there is more and more capital 470 00:24:39,000 --> 00:24:43,520 Speaker 1: being spent, technology being developed, and products being designed. So 471 00:24:44,320 --> 00:24:47,159 Speaker 1: I believe that there is this point of no return 472 00:24:47,200 --> 00:24:50,520 Speaker 1: beyond which you have to follow on with your plans, 473 00:24:50,960 --> 00:24:53,120 Speaker 1: because how long does it take to get a car 474 00:24:53,280 --> 00:24:55,760 Speaker 1: from concept actually out the door. I mean we're talking 475 00:24:55,760 --> 00:24:59,160 Speaker 1: about four years for a presidential cycle and executive orders 476 00:24:59,160 --> 00:25:01,439 Speaker 1: that come there were, it takes a good amount of 477 00:25:01,480 --> 00:25:04,840 Speaker 1: time for vehicle manufacturer to actually go from concept to 478 00:25:05,400 --> 00:25:10,000 Speaker 1: your driveway, right that correct, especially with new technologies and 479 00:25:10,520 --> 00:25:13,760 Speaker 1: what we call new platforms. A platform is a concept 480 00:25:13,840 --> 00:25:17,840 Speaker 1: that involves like everything from technical designs or all the 481 00:25:17,880 --> 00:25:20,760 Speaker 1: way to how you develop your supply chain. It can 482 00:25:20,800 --> 00:25:23,879 Speaker 1: take a long time, and it takes let's see the 483 00:25:23,880 --> 00:25:27,800 Speaker 1: best part of five year and five years and several 484 00:25:27,800 --> 00:25:31,719 Speaker 1: billion dollars to develop these electric vehicle platforms. For example, 485 00:25:31,760 --> 00:25:35,600 Speaker 1: this something like the Alding platform that GM is developing 486 00:25:35,720 --> 00:25:38,760 Speaker 1: and from their own so let's say a five year 487 00:25:38,800 --> 00:25:43,120 Speaker 1: period that's a minimum, and from their own it's depending 488 00:25:43,160 --> 00:25:48,280 Speaker 1: on the product schedule. It may take even longer to 489 00:25:48,280 --> 00:25:51,760 Speaker 1: to bring new new vehicles on on on the market, 490 00:25:52,880 --> 00:25:56,439 Speaker 1: so practically the investments that the GM and other automakers 491 00:25:56,440 --> 00:26:01,000 Speaker 1: are doing now they will be utilized up until the 492 00:26:01,480 --> 00:26:06,560 Speaker 1: end of that's the platform point is super interesting in 493 00:26:06,600 --> 00:26:11,680 Speaker 1: my view because it kind of changes dramatically the approach 494 00:26:11,720 --> 00:26:15,640 Speaker 1: to making cars from a manufacturing point of view, and 495 00:26:16,080 --> 00:26:20,040 Speaker 1: the companies that are working on these unified platforms for 496 00:26:20,240 --> 00:26:24,199 Speaker 1: making you know, a whole suite of electric vehicles for 497 00:26:24,320 --> 00:26:28,320 Speaker 1: the future are always telling us about these benefits, and 498 00:26:28,400 --> 00:26:32,720 Speaker 1: for example, v W has the MTB platform. Daimler has 499 00:26:32,800 --> 00:26:35,280 Speaker 1: two platforms I believe, depending on the size of the vehic, 500 00:26:35,320 --> 00:26:37,320 Speaker 1: called the E v A and the M M A. 501 00:26:37,920 --> 00:26:41,200 Speaker 1: GM has the old tium. My question then, is, if 502 00:26:41,240 --> 00:26:44,399 Speaker 1: you're spending all these money and all these years building 503 00:26:44,440 --> 00:26:48,160 Speaker 1: these platforms that are going to determine then future horizon 504 00:26:48,200 --> 00:26:50,040 Speaker 1: of products that are going to be electric that are 505 00:26:50,080 --> 00:26:53,080 Speaker 1: going to become your sources of revenue for the long term, 506 00:26:53,280 --> 00:26:56,240 Speaker 1: why would I completely like GM say that it plans 507 00:26:56,280 --> 00:26:59,720 Speaker 1: to license its platform to other companies that are that 508 00:26:59,760 --> 00:27:02,760 Speaker 1: want make electric vehicles. So it makes me think about, 509 00:27:03,040 --> 00:27:07,479 Speaker 1: you know what, ever, license its EV platform to another 510 00:27:08,000 --> 00:27:10,879 Speaker 1: car company to make cars that are gonna you know, 511 00:27:11,480 --> 00:27:15,040 Speaker 1: look quite similar to THEIRS, or at least have functionality 512 00:27:15,040 --> 00:27:17,320 Speaker 1: that is quite similar to THEIRS. So if this is 513 00:27:17,400 --> 00:27:20,760 Speaker 1: like a core product for the future growth of the company, 514 00:27:21,160 --> 00:27:24,600 Speaker 1: why think about licensing like your key piece of I 515 00:27:24,760 --> 00:27:26,840 Speaker 1: P that is going to take you into the next 516 00:27:26,840 --> 00:27:29,320 Speaker 1: generation as a car maker. So all the things that 517 00:27:29,320 --> 00:27:31,520 Speaker 1: are being developed, invariably at the end of the line, 518 00:27:31,520 --> 00:27:34,400 Speaker 1: you want people to buy them. My question really has 519 00:27:34,440 --> 00:27:37,119 Speaker 1: to do with consumer tastes. So in China you end 520 00:27:37,200 --> 00:27:40,800 Speaker 1: up seeing that actually better electric vehicles have really taken off. 521 00:27:40,840 --> 00:27:44,040 Speaker 1: So for the past three years they were the largest 522 00:27:44,040 --> 00:27:46,720 Speaker 1: consumers of better electric vehicles, and I think only last 523 00:27:46,800 --> 00:27:49,960 Speaker 1: year was the year where Europe took that title back 524 00:27:50,000 --> 00:27:52,639 Speaker 1: and and more being sold actually here than in China. 525 00:27:52,720 --> 00:27:54,879 Speaker 1: But assuming that that continues to be the trend in 526 00:27:54,960 --> 00:27:59,080 Speaker 1: China and they remain popular there, there's a reasonable assertion 527 00:27:59,160 --> 00:28:01,800 Speaker 1: that GM strap G is aligned with consumer taste. But 528 00:28:01,880 --> 00:28:04,560 Speaker 1: how about in their other major market, the United States, 529 00:28:04,880 --> 00:28:07,920 Speaker 1: where it doesn't look like the vehicles are getting smaller 530 00:28:07,960 --> 00:28:10,880 Speaker 1: on the road of anything, they're getting bigger. And if 531 00:28:10,880 --> 00:28:13,320 Speaker 1: they start putting out a bunch of cars that people 532 00:28:13,359 --> 00:28:17,640 Speaker 1: don't want in a consumer discretionary space, especially one hit 533 00:28:17,720 --> 00:28:22,000 Speaker 1: by an economic downturn spurned by COVID nineteen. Do you 534 00:28:22,080 --> 00:28:25,480 Speaker 1: really think that this is feasibly going to happen and 535 00:28:25,520 --> 00:28:28,360 Speaker 1: that this idea that they will no longer sell internal 536 00:28:28,400 --> 00:28:31,879 Speaker 1: combustion engines is a true possibility. I think that's a 537 00:28:31,960 --> 00:28:34,679 Speaker 1: very good point, has a lot of nuance behind it, 538 00:28:34,720 --> 00:28:38,160 Speaker 1: and it's um it's in fact, it's quite crucial for 539 00:28:38,160 --> 00:28:42,120 Speaker 1: for GM and other automakers that are thinking of pivoting 540 00:28:42,160 --> 00:28:45,680 Speaker 1: towards electrification. One of the things that we've discussed for 541 00:28:46,080 --> 00:28:51,040 Speaker 1: about technology all these until now and then of course 542 00:28:51,200 --> 00:28:56,320 Speaker 1: people by the technology, but also they buy the final product. 543 00:28:56,680 --> 00:29:00,760 Speaker 1: So one of the main concerns are these The main 544 00:29:00,840 --> 00:29:05,800 Speaker 1: challenges that the companies have is to build desirable products 545 00:29:05,880 --> 00:29:08,800 Speaker 1: on top of the technology of the advanced technology that 546 00:29:08,880 --> 00:29:12,760 Speaker 1: they are developing, and this is quite an acute challenge, 547 00:29:12,880 --> 00:29:15,440 Speaker 1: especially in the US. As you mentioned, the fact that 548 00:29:15,560 --> 00:29:20,360 Speaker 1: GMS volume in the US consists of eight, perhaps perhaps 549 00:29:20,360 --> 00:29:24,240 Speaker 1: even more of largest uvs and pickup trucks makes this 550 00:29:24,520 --> 00:29:28,280 Speaker 1: transition for them in the short term quite difficult. A 551 00:29:28,400 --> 00:29:32,200 Speaker 1: pickup truck in the US can contribute anywhere between five 552 00:29:32,240 --> 00:29:35,480 Speaker 1: and fifteen thousand dollars in earnings before interest and tax 553 00:29:36,080 --> 00:29:40,000 Speaker 1: directly from automaker. And that's simply to say some average 554 00:29:40,000 --> 00:29:44,280 Speaker 1: across the different automent the large automakers that sell large 555 00:29:44,280 --> 00:29:47,320 Speaker 1: pickup trucks in in the US in the short terms 556 00:29:47,320 --> 00:29:49,120 Speaker 1: the next let's say five years, and likely that an 557 00:29:49,160 --> 00:29:53,200 Speaker 1: ev A pickup truck electric pickup truck will be able 558 00:29:53,240 --> 00:29:56,680 Speaker 1: to continue to have the same profit margins and contribute 559 00:29:56,880 --> 00:30:00,760 Speaker 1: as much at a companis earnings. So how your transition 560 00:30:00,840 --> 00:30:04,080 Speaker 1: from your main volume now being these sort of large 561 00:30:04,200 --> 00:30:08,120 Speaker 1: vehicles that contribute so much money to something that by 562 00:30:08,160 --> 00:30:11,840 Speaker 1: necessity and by necessity I mean both technical and cost necessity, 563 00:30:12,080 --> 00:30:14,800 Speaker 1: will have to be slightly smaller and perhaps not as 564 00:30:14,840 --> 00:30:17,560 Speaker 1: profitable in the short term. How you make that transition 565 00:30:17,800 --> 00:30:20,120 Speaker 1: for GM and for other companies, especially in the US, 566 00:30:20,440 --> 00:30:22,680 Speaker 1: is going to be one of the one of the 567 00:30:22,720 --> 00:30:25,040 Speaker 1: most tricky things that they will have to to get right. 568 00:30:25,880 --> 00:30:27,800 Speaker 1: I don't think it's going to be easy at all 569 00:30:27,880 --> 00:30:31,240 Speaker 1: for them to make this this transition, but eventually they 570 00:30:31,320 --> 00:30:34,560 Speaker 1: have to. They do, claim nickol Nicholas. They claim that 571 00:30:34,840 --> 00:30:39,680 Speaker 1: with the platform approach to manufacturing e vs using the 572 00:30:39,720 --> 00:30:43,320 Speaker 1: old Tium platform, they're gonna be saving a lot on 573 00:30:43,400 --> 00:30:47,280 Speaker 1: tool set costs for building new assembly plants compared to 574 00:30:47,320 --> 00:30:50,520 Speaker 1: building those new assembly plants if you were making internal 575 00:30:50,520 --> 00:30:54,680 Speaker 1: compost and engine vehicles. But if you're looking about margins 576 00:30:54,720 --> 00:30:57,000 Speaker 1: that are that thick for setting pickup trucks in the 577 00:30:57,120 --> 00:31:00,200 Speaker 1: US for you know the examples you brought up, and 578 00:31:00,400 --> 00:31:02,880 Speaker 1: what Danta said about the consumers still wanting to buy 579 00:31:02,880 --> 00:31:05,080 Speaker 1: big trucks, especially in the U S which is probably 580 00:31:05,120 --> 00:31:08,680 Speaker 1: one of the largest it is the largest market for GM. 581 00:31:08,800 --> 00:31:13,720 Speaker 1: Then the promise of savings from tool set costs, homogeneous 582 00:31:13,720 --> 00:31:17,680 Speaker 1: platform for making a whole suite of evs for different segments, 583 00:31:18,480 --> 00:31:22,840 Speaker 1: that thing has to materialize because as much as Wall 584 00:31:22,880 --> 00:31:27,640 Speaker 1: Street likes to see conventional car companies have electrification plans, 585 00:31:28,040 --> 00:31:30,120 Speaker 1: and as much as we, as analyst at bn F, 586 00:31:30,480 --> 00:31:34,120 Speaker 1: see those electrification plans as key to fulfill our consumer 587 00:31:34,160 --> 00:31:37,760 Speaker 1: adoption forecast for electric vehicles in the long term, it 588 00:31:37,840 --> 00:31:40,320 Speaker 1: comes to that to the point of I sell now 589 00:31:40,480 --> 00:31:43,120 Speaker 1: a product that makes me a lot of money, but 590 00:31:43,240 --> 00:31:48,000 Speaker 1: it's not gonna help me fulfill my fuel efficiency standards. 591 00:31:48,160 --> 00:31:52,280 Speaker 1: It's not going to make me utilize at full capacity 592 00:31:52,400 --> 00:31:56,240 Speaker 1: my new eving manufacturing platform. So I think it says 593 00:31:56,280 --> 00:31:59,000 Speaker 1: a lot about the very tricky situation where GM is, 594 00:31:59,040 --> 00:32:01,680 Speaker 1: and it's actually quite unique the situation in which they 595 00:32:01,680 --> 00:32:05,320 Speaker 1: are in because of the specific segments that they have 596 00:32:05,520 --> 00:32:09,479 Speaker 1: been focusing more and more and more on their pickups. Well, 597 00:32:09,520 --> 00:32:11,800 Speaker 1: and some of this all revolves around the concept that 598 00:32:11,880 --> 00:32:15,240 Speaker 1: we will be able to see better electric vehicles that 599 00:32:15,280 --> 00:32:19,360 Speaker 1: are at cost parity with internal combustion engines. And actually 600 00:32:19,360 --> 00:32:21,880 Speaker 1: we are being kind of keep looking at that and 601 00:32:21,920 --> 00:32:24,840 Speaker 1: what that year may end up being. Could you actually 602 00:32:25,240 --> 00:32:28,080 Speaker 1: share with everybody when we think it might be possible 603 00:32:28,080 --> 00:32:31,240 Speaker 1: at least as of today, that's around the let's even 604 00:32:31,280 --> 00:32:35,520 Speaker 1: mid decade, depending on segments, depending on country and everything. 605 00:32:35,560 --> 00:32:38,200 Speaker 1: I mean, it can be as soon as next year 606 00:32:38,280 --> 00:32:41,560 Speaker 1: or the year after for some segments, perhaps some large 607 00:32:41,600 --> 00:32:45,240 Speaker 1: cars or smaller as uvs in Europe and in the US, 608 00:32:45,280 --> 00:32:48,440 Speaker 1: but as late as even twenty thirty we're looking at 609 00:32:49,000 --> 00:32:53,520 Speaker 1: small cars in China or smaller vehicles in in Europe. 610 00:32:53,920 --> 00:32:57,560 Speaker 1: The main terminum there of when this price party is 611 00:32:57,640 --> 00:33:01,160 Speaker 1: up from cost price party happens um is the price 612 00:33:01,200 --> 00:33:03,440 Speaker 1: of the battery, of course, and let's say they as 613 00:33:03,480 --> 00:33:06,000 Speaker 1: a rule of thumb, we can we can take the 614 00:33:06,120 --> 00:33:10,600 Speaker 1: hundred dollars per kilo at our as the threshold below 615 00:33:10,680 --> 00:33:14,600 Speaker 1: which more and more segments start to become price competitive 616 00:33:14,800 --> 00:33:17,720 Speaker 1: and the larger share of the total automotive market is 617 00:33:17,760 --> 00:33:22,920 Speaker 1: being opened up for electric vehicles. However, that price can 618 00:33:22,960 --> 00:33:25,880 Speaker 1: be as low as eighty dollars perticul power for for 619 00:33:25,960 --> 00:33:28,240 Speaker 1: some segments, but on the other hand, it can be 620 00:33:28,440 --> 00:33:30,560 Speaker 1: as high as hundred twenty or even a hundred and 621 00:33:30,600 --> 00:33:35,760 Speaker 1: thirty dollars pertulitwer for some other segments, perhaps more luxury luxury, 622 00:33:36,080 --> 00:33:39,120 Speaker 1: larger large vehicles. I think the main point to make 623 00:33:39,160 --> 00:33:45,000 Speaker 1: here is that there is some visibility on that cost trajectory, 624 00:33:45,120 --> 00:33:48,680 Speaker 1: even though it can still be uncertain, and because it 625 00:33:48,720 --> 00:33:53,320 Speaker 1: depends on the specificities of different manufacturers and where they 626 00:33:53,360 --> 00:33:56,560 Speaker 1: operate in which segments, and what volume of batteries they 627 00:33:56,600 --> 00:33:58,880 Speaker 1: buy and and all that, I mean, there seems like 628 00:33:58,920 --> 00:34:01,560 Speaker 1: it's roughly aligned. The is an assumption that when we 629 00:34:01,720 --> 00:34:06,160 Speaker 1: go to purchase, either in an individual or for a 630 00:34:06,160 --> 00:34:08,520 Speaker 1: fleet for a business, that there will come a point 631 00:34:08,520 --> 00:34:11,560 Speaker 1: where they are the same price, if not cheaper, than 632 00:34:11,640 --> 00:34:15,200 Speaker 1: internal combustion engines. Now, on these comparisons, which I know 633 00:34:15,400 --> 00:34:18,480 Speaker 1: people like to do, every so often someone ends up 634 00:34:18,600 --> 00:34:21,440 Speaker 1: bringing up the fact that the batteries that go into 635 00:34:21,560 --> 00:34:25,839 Speaker 1: battery electric vehicles are produced in some cases on very 636 00:34:26,000 --> 00:34:29,680 Speaker 1: coal intensive and therefore polluting grids, and they're pretty energy 637 00:34:29,719 --> 00:34:32,759 Speaker 1: intensive to make. So if you take that combined with 638 00:34:32,800 --> 00:34:34,600 Speaker 1: the fact that you actually have to charge the vehicle, 639 00:34:34,640 --> 00:34:37,399 Speaker 1: and additionally the grids vary in terms of how clean 640 00:34:37,440 --> 00:34:39,400 Speaker 1: they are and what whether or not you're charging on 641 00:34:39,440 --> 00:34:41,760 Speaker 1: wind or you're charging on coal, you're charging on gas. 642 00:34:42,480 --> 00:34:46,319 Speaker 1: Are these electric vehicles and is this strategy actually going 643 00:34:46,360 --> 00:34:50,440 Speaker 1: to make that big of a difference in terms of emissions? 644 00:34:50,960 --> 00:34:55,840 Speaker 1: The short, yes, the life cycle emissions of bottom electric 645 00:34:55,920 --> 00:35:01,560 Speaker 1: vehicles are already for vehicles may have been produced last year, 646 00:35:01,960 --> 00:35:06,520 Speaker 1: already lower than the equivalent emissions the emissions of equivalent 647 00:35:06,520 --> 00:35:09,920 Speaker 1: internal combustion engine vehicles. That depends, of course. I mean 648 00:35:09,960 --> 00:35:13,160 Speaker 1: there are cases, especially in countries such as China and 649 00:35:13,200 --> 00:35:16,680 Speaker 1: the U S which are very large and the grid 650 00:35:16,719 --> 00:35:19,160 Speaker 1: intensity they suit two intensity of the grid of the 651 00:35:19,200 --> 00:35:22,239 Speaker 1: electricity grid varies a lot throughout the country. You may 652 00:35:22,360 --> 00:35:26,640 Speaker 1: find situations where a cold, heavy grid may make the 653 00:35:26,719 --> 00:35:30,839 Speaker 1: life cycle emissions of battery electric vehicles, let's say, comparable 654 00:35:30,920 --> 00:35:34,200 Speaker 1: to those of internal combustion engine cars. That is, of course, 655 00:35:34,239 --> 00:35:37,200 Speaker 1: for cars that were produced last year. What happens, however, 656 00:35:37,320 --> 00:35:39,880 Speaker 1: is that the electricit degreeds, as we know, is the 657 00:35:39,880 --> 00:35:43,920 Speaker 1: carbonizing at a very fast rate, which means that by 658 00:35:43,960 --> 00:35:47,320 Speaker 1: twenty thirty, even in those edge cases that may exist 659 00:35:47,680 --> 00:35:51,960 Speaker 1: now those cases will not exist. May then butter electric 660 00:35:51,960 --> 00:35:56,360 Speaker 1: cars over the life cycle will have lower Suit two emissions. No, 661 00:35:57,560 --> 00:35:59,680 Speaker 1: there is in life cycle analysis, there is. We have 662 00:35:59,719 --> 00:36:03,240 Speaker 1: to make some you know, to to to better define 663 00:36:03,440 --> 00:36:05,560 Speaker 1: what we mean in what I mean now and what 664 00:36:05,680 --> 00:36:10,320 Speaker 1: I described now. For example, we include battery manufacturing emissions, 665 00:36:10,560 --> 00:36:14,080 Speaker 1: vehicle manufacturing emissions, and utilization emissions at the moment, would 666 00:36:14,080 --> 00:36:18,200 Speaker 1: not include recycling for example, for for the different components 667 00:36:18,200 --> 00:36:21,400 Speaker 1: that go there. And this is still an area of 668 00:36:22,000 --> 00:36:25,759 Speaker 1: active research as as understanding and research that we also 669 00:36:25,880 --> 00:36:28,520 Speaker 1: do here to to understand what what the emissions are 670 00:36:28,560 --> 00:36:32,120 Speaker 1: in in this in this process. But in general, the 671 00:36:32,239 --> 00:36:36,160 Speaker 1: gap between life cycle emissions of body electric vehicles and 672 00:36:36,800 --> 00:36:40,120 Speaker 1: combustion engine vehicles is relatively large. I mean, we're talking 673 00:36:40,160 --> 00:36:42,359 Speaker 1: about a factor of two or three or even four 674 00:36:42,760 --> 00:36:47,080 Speaker 1: in some cases. So body electric vehicles can be about 675 00:36:47,080 --> 00:36:49,920 Speaker 1: a quarter or even less emit about a quarter or 676 00:36:49,920 --> 00:36:54,240 Speaker 1: even less Sue two throughout their lifetime than comparable combustion 677 00:36:54,280 --> 00:36:57,080 Speaker 1: engine vehicles. Well, so do some that one up means 678 00:36:57,080 --> 00:37:00,640 Speaker 1: that the effort is worth? What is it the efforts 679 00:37:00,640 --> 00:37:03,840 Speaker 1: worth to squeeze? I think is the phrase are the 680 00:37:03,880 --> 00:37:07,759 Speaker 1: effort that GM is putting into looking at these scope one, two, 681 00:37:07,840 --> 00:37:10,359 Speaker 1: and three. And as we know the United States, their 682 00:37:10,360 --> 00:37:13,320 Speaker 1: primary source of CEO two emissions are actually from the 683 00:37:13,360 --> 00:37:16,640 Speaker 1: transportation sector. This may end up yielding some real results 684 00:37:16,640 --> 00:37:21,239 Speaker 1: in terms of overall emissions for the countries where they're 685 00:37:21,280 --> 00:37:23,840 Speaker 1: selling their products. So you look at a lot of 686 00:37:23,840 --> 00:37:26,480 Speaker 1: the technology that goes into this, and you've referenced a 687 00:37:26,520 --> 00:37:28,600 Speaker 1: lot of the platforms. Now, I'm sure GM is going 688 00:37:28,640 --> 00:37:30,359 Speaker 1: to put a ton of money into R and D here, 689 00:37:30,640 --> 00:37:33,280 Speaker 1: but you've got some insight into some of the different 690 00:37:33,320 --> 00:37:35,839 Speaker 1: investments or let's say, partnerships that they've made in order 691 00:37:35,880 --> 00:37:38,319 Speaker 1: to bring this tech forward. So could you tell us 692 00:37:38,320 --> 00:37:41,560 Speaker 1: a little bit about that and just some of the 693 00:37:41,600 --> 00:37:44,000 Speaker 1: cool technology that you see coming out? We can talk 694 00:37:44,040 --> 00:37:46,480 Speaker 1: about some of the cool stuff car companies and GM 695 00:37:46,520 --> 00:37:49,840 Speaker 1: in particular are doing around data and connectivity. You know, 696 00:37:49,880 --> 00:37:53,120 Speaker 1: GM might have been a little bit late coming to 697 00:37:53,239 --> 00:37:57,520 Speaker 1: the e V revolution with their super platform, but they've 698 00:37:57,520 --> 00:38:00,960 Speaker 1: actually done some really interesting stuff on autonomy. They were 699 00:38:01,200 --> 00:38:03,719 Speaker 1: one of the first car companies that invested in a 700 00:38:03,800 --> 00:38:08,200 Speaker 1: startup that was developing software that would help cars drive themselves. 701 00:38:08,719 --> 00:38:14,280 Speaker 1: That company's Crews Automation, and when GM acquired a company 702 00:38:14,320 --> 00:38:18,480 Speaker 1: in twenty sixteen, the company had raised about five hundred 703 00:38:18,640 --> 00:38:21,480 Speaker 1: and eighty million dollars. They didn't disclose the details of 704 00:38:21,480 --> 00:38:24,399 Speaker 1: the transaction with GM, so if you were to put 705 00:38:24,440 --> 00:38:26,680 Speaker 1: a number about that value of that company would be 706 00:38:26,719 --> 00:38:28,600 Speaker 1: more or less around what they had raised if we 707 00:38:28,719 --> 00:38:33,560 Speaker 1: just follow the cash. And Crews had a new funding 708 00:38:34,000 --> 00:38:39,200 Speaker 1: round in January this year that included Microsoft and Honda, 709 00:38:39,520 --> 00:38:44,520 Speaker 1: and according to media evaluation was thirty billion dollars. So 710 00:38:44,520 --> 00:38:47,800 Speaker 1: we're talking about a company that GM bought in sixteen 711 00:38:47,840 --> 00:38:53,000 Speaker 1: that had raised million dollars that has now been valued, 712 00:38:53,040 --> 00:38:57,360 Speaker 1: according to media reports not US at thirty billion dollars. 713 00:38:57,960 --> 00:39:01,320 Speaker 1: So that's in my view, that's pretty good move for GM. 714 00:39:01,440 --> 00:39:05,240 Speaker 1: GM also was very creative in the way they managed 715 00:39:05,239 --> 00:39:10,120 Speaker 1: that investment. They basically created a separate entity that would 716 00:39:10,239 --> 00:39:14,399 Speaker 1: allow other car companies to invest in Crewise Automation, even 717 00:39:14,440 --> 00:39:17,239 Speaker 1: though GM had a majority stake in the company, so 718 00:39:17,239 --> 00:39:19,400 Speaker 1: it allowed it to collaborate in a in developing a 719 00:39:19,440 --> 00:39:22,719 Speaker 1: technology that is expensive to develop, such as autonomy, with 720 00:39:22,800 --> 00:39:26,200 Speaker 1: other car companies that weren't ready to fully develop it 721 00:39:26,280 --> 00:39:28,640 Speaker 1: in house, but just wanted to leverage some of their 722 00:39:28,680 --> 00:39:31,279 Speaker 1: around the capital to go invest in a third party 723 00:39:31,520 --> 00:39:35,000 Speaker 1: without having to get to complicated the relationship, because relationships 724 00:39:35,040 --> 00:39:37,719 Speaker 1: with with car companies then to be super complicated and 725 00:39:37,920 --> 00:39:41,640 Speaker 1: don't end nicely usually. So it was super, you know, 726 00:39:41,680 --> 00:39:43,359 Speaker 1: I think it was super what GM did with with 727 00:39:43,440 --> 00:39:49,760 Speaker 1: crews on the data side. GM is interesting because they've 728 00:39:49,800 --> 00:39:56,040 Speaker 1: been equipping their cars with their on Star telematics communication 729 00:39:56,080 --> 00:39:59,560 Speaker 1: system for a while now, so there's a pre robust 730 00:39:59,640 --> 00:40:02,799 Speaker 1: fleet of general model cars in the wild to put 731 00:40:02,800 --> 00:40:06,759 Speaker 1: in away that are connected through their telematics to this 732 00:40:07,440 --> 00:40:11,400 Speaker 1: to this platform. Historically, it was a service that would 733 00:40:11,640 --> 00:40:14,399 Speaker 1: basically offer you like a last minute rescuing case something 734 00:40:14,400 --> 00:40:16,879 Speaker 1: happened to the car if you paid a fee. After 735 00:40:16,920 --> 00:40:21,319 Speaker 1: a few years of purchasing the car, that didn't scale much. 736 00:40:21,920 --> 00:40:24,080 Speaker 1: But the reality is that those cars are out there 737 00:40:24,480 --> 00:40:27,560 Speaker 1: with that capability to connect to a central processing unit 738 00:40:28,280 --> 00:40:30,839 Speaker 1: where data about where those cars are being taken, how 739 00:40:30,840 --> 00:40:34,040 Speaker 1: those cars are being driven for how long, in what cities, 740 00:40:34,120 --> 00:40:38,319 Speaker 1: in what conditions, etcetera is being collected and that c S. 741 00:40:38,640 --> 00:40:42,680 Speaker 1: This year at the Consumer Electronics Show, GM mentioned something 742 00:40:42,719 --> 00:40:46,040 Speaker 1: that I thought it was super interesting, and they said 743 00:40:46,280 --> 00:40:50,239 Speaker 1: that they will in the future leverage some of the 744 00:40:50,320 --> 00:40:53,520 Speaker 1: data that they have been collecting through their telematics via 745 00:40:53,640 --> 00:40:58,759 Speaker 1: on start to start building insurance products. So imagine the 746 00:40:58,800 --> 00:41:02,520 Speaker 1: beauty of this insurance that tells you everything about how 747 00:41:02,600 --> 00:41:06,399 Speaker 1: that car that you're about to ensure is used. Because it's, 748 00:41:06,600 --> 00:41:10,240 Speaker 1: you know, fully connected through this cinematic system, you can 749 00:41:10,440 --> 00:41:13,440 Speaker 1: calculate those premiums to perfection. Is it isn't you know, 750 00:41:13,760 --> 00:41:16,160 Speaker 1: an underwriter's dream to be able to have that information 751 00:41:16,200 --> 00:41:18,719 Speaker 1: because you don't have to risk you know, how is 752 00:41:18,719 --> 00:41:20,640 Speaker 1: this guy gonna drive that car? You know how this 753 00:41:20,760 --> 00:41:22,840 Speaker 1: guy drives that car because you have all the information 754 00:41:22,880 --> 00:41:26,279 Speaker 1: thanks to the on Star telematic system. So I think 755 00:41:26,320 --> 00:41:29,680 Speaker 1: that's that's very very interesting. It was. It wasn't the 756 00:41:29,719 --> 00:41:32,600 Speaker 1: main announcement at c S, but it was my favorite 757 00:41:32,600 --> 00:41:35,360 Speaker 1: announcement without a doubt, coming from GM. You know, the 758 00:41:35,400 --> 00:41:37,839 Speaker 1: insurance stuff never did quite seem fair to me, so 759 00:41:38,000 --> 00:41:40,120 Speaker 1: maybe this would level it up a little bit and 760 00:41:40,120 --> 00:41:42,440 Speaker 1: make it seem a little more fair to everyone paying 761 00:41:42,480 --> 00:41:45,680 Speaker 1: those premiums. Ali Nicholas, thank you so much for joining 762 00:41:45,719 --> 00:41:48,399 Speaker 1: today and telling us about you know, really this significant 763 00:41:48,440 --> 00:41:51,120 Speaker 1: statement by GM and really where the industry is going. 764 00:41:51,800 --> 00:41:54,560 Speaker 1: I personally have a plug in hybrid at the moment, 765 00:41:54,600 --> 00:41:57,680 Speaker 1: and I'm telling you I want a full batterily electric vehicle, 766 00:41:57,880 --> 00:42:00,840 Speaker 1: so hopefully or maybe it'll end up being by GM 767 00:42:00,840 --> 00:42:03,440 Speaker 1: in the future. But again, thank you so much and 768 00:42:03,640 --> 00:42:13,719 Speaker 1: see you guys next time. Today's episode of Switched On 769 00:42:13,760 --> 00:42:16,760 Speaker 1: was edited by Rex Warner of gray Stoke Media. 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