Speaker 1: This is Bloomberg Business Week with Carol Messer and Bloomberg
Speaker 1: Quick Takes Tim Stinovic on Bloomberg Radio. There is overall
Speaker 1: a worldwide push toward electrification. It's causing a three year
Speaker 1: wave hulf. Initial public offerings in the EV electric vehicle
Speaker 1: space could raise about a hundred billion until the end
Speaker 1: of that's, according to be of a meantime, A recent
Speaker 1: report says the global EV market is expected to reach
Speaker 1: tim nearly nine eighteen billion in and GM looking to
Speaker 1: be a major player in all of it. Cadillac, in fact,
Speaker 1: is looking to be an all electric company by the
Speaker 1: year twenty thirty. Joining us now is Rory Harvey, Global
Speaker 1: vice president of Cadillac. He joins us on the phone
Speaker 1: from New York City. Rory, how are you? It'll be fine,
Speaker 1: thanks yourself, Juan, Well, thanks, it's really it's really great
Speaker 1: to have you. Um, why go electric now? Why is
Speaker 1: why is now the right time versus a few years ago? Yeah?
Speaker 1: I guess you know. There are multiple factors that coming
Speaker 1: to play that, and one is is the market at
Speaker 1: option ready for these? The second is is the infrastructure
Speaker 1: out there? The third is other capabilities there? The fourth
Speaker 1: is are the demander or is the demand there. I
Speaker 1: think there's lots of different data sources. I'm sure that
Speaker 1: you have access to many of them that you extrapolate
Speaker 1: what is going to happen with eb adoption. And from
Speaker 1: our perspective, we think now that the time is right
Speaker 1: absolutely to put up on the accelerated panel. We have
Speaker 1: a great portfolio today of icicles, but we think now
Speaker 1: is the time to compliment that word switching to eving.
Speaker 1: So I'm going to ask a different question that why
Speaker 1: does it Why is it going to take to twenty thirty?
Speaker 1: Why not sooner? Especially when you've got you know, a
Speaker 1: company like Tesla that has definitely at this point is
Speaker 1: out front and center and has the first mover advantage.
Speaker 1: They're now ranked is the world's most valuable car company
Speaker 1: by far. You've got Ruvian supporting this second house market
Speaker 1: cap among US carmakers despite having no sales revenue yet.
Speaker 1: I mean, that's a topic for another conversation. So I'm
Speaker 1: just curious, you know, why not try and do it
Speaker 1: sooner rather than later? Is it logistically it's just got
Speaker 1: to take this amount of time. No, I think it's
Speaker 1: a it's balancing basically, what we need to do, what
Speaker 1: we need to do in terms of market opportunity with
Speaker 1: our ice vehicles, what we need to do in terms
Speaker 1: of evs. So as an example, if you looked at
Speaker 1: the Lyric, which will be the first EV in terms
Speaker 1: of luxury crossover from Cadillac, we pulled that forward by
Speaker 1: nine months. So we brought that forward and accelerated it
Speaker 1: to the back end of March in twenty two. That
Speaker 1: will be followed by the Celestique, which will be an
Speaker 1: ultra luxury brand. And indeed, you know, without giving the
Speaker 1: time in a way of all of the product portfolio,
Speaker 1: if you look at GM across the board, we will
Speaker 1: have thirty products by twenty five that are EV variants,
Speaker 1: with about sixty of those sold in the US. So
Speaker 1: there is a fairly aggressive introduction of the evs moving forward.
Speaker 1: I guess the thirty time scale is, you know, the
Speaker 1: period of time when we would be selling the last
Speaker 1: ice vehicles from the Cadillac perspective, but we will certainly
Speaker 1: be in the market much earlier than that compliment in
Speaker 1: our ice vehicle cells. With EVY vehicles. You know, Tim
Speaker 1: and I talk or a lot about um wanting our
Speaker 1: next car to be an electric vehicle. Uh, Tim lives
Speaker 1: in the city. I lived just outside the city. In
Speaker 1: the urban environment, you do wonder about, Okay, how the
Speaker 1: heck am I going to charge this puppy? How much
Speaker 1: of your timing also is thinking about the bigger, broader
Speaker 1: infrastructure problems that I feel like we've been talking about
Speaker 1: for a few years that in order for evs to
Speaker 1: really come, you need to have the EV support network
Speaker 1: to be there as well, especially when it comes to charging.
Speaker 1: You're absolutely right, Carol, I mean that's that's fundamental. And
Speaker 1: if you look at some of the metropolitan areas, you
Speaker 1: know there's a big push in terms of infrastructure. If
Speaker 1: you look at some of the legislation and some of
Speaker 1: the activities that the states are putting in place, you
Speaker 1: have AMENDMENTUM is really starting to build. But it's a
Speaker 1: it's a fundamental issue in terms of being able to
Speaker 1: facilitate demand with customer convenience. And from that point of view,
Speaker 1: you know, there's a number of things that we're doing,
Speaker 1: whether it be working with our dealer partners to put
Speaker 1: charging stations in place that we made an announcement the
Speaker 1: week before last. In terms of that, whether it be
Speaker 1: our mobile app, which basically gives customers the ability to
Speaker 1: be able to determine where to charge, which charges are up,
Speaker 1: and NY minimum downtime, et cetera. But it is one
Speaker 1: of the challenges that the industry places in terms of ensuring,
Speaker 1: particularly in some of those densely populated areas, that the
Speaker 1: infrastructure is there. So again, that's part of the reason
Speaker 1: that at the moment we have the need to be
Speaker 1: able to satisfy customers from a nice vehicle perspective, but
Speaker 1: also from an ev perspective. Hey, Rory, is you know
Speaker 1: when it comes to battery charging stations, how much of
Speaker 1: it is the private sector responsibility? How much is it
Speaker 1: public sector? Is it a little bit of both? I
Speaker 1: think it's a it's a little bit of both, you know.
Speaker 1: I think it's uh, it's down to the incentives that
Speaker 1: are available. It's down to the distribution. It's down to
Speaker 1: private companies because there's a business opportunity, it's down to
Speaker 1: public I think this one is a team effort in
Speaker 1: terms of putting the infrastructure in place. I did want
Speaker 1: to ask you about I mentioned Tessa and now ranked
Speaker 1: as the world's most valuable car company. Get Rivian it's
Speaker 1: boring the second highest market cap among US car makers.
Speaker 1: How do you see Tessa and Rivian in the overall
Speaker 1: auto market? Yeah, I guess that's an interesting question. To
Speaker 1: be a very candidate, I'd prefer to talk about GM
Speaker 1: and and how we sit in the overall market, because
Speaker 1: you know, we have our vision of the car company,
Speaker 1: which has zero crashings, zero emissions of the zero congestion,
Speaker 1: and we believe that that's a key catalyst for growth.
Speaker 1: There's no doubt that there are incremental competitors that have
Speaker 1: come into the industry over the recent past, and that
Speaker 1: some of those are having successes. As you mentioned earlier
Speaker 1: in your opening, some of them at the moment have
Speaker 1: sold a very limited amount of vehicles. But I think
Speaker 1: the the exciting part from my perspective is that I
Speaker 1: think that this is an incredible opportunity for General Motors,
Speaker 1: and I think it's a great investment opportunity for us
Speaker 1: in terms of growth. We had an invested day probably
Speaker 1: about a month ago now, where again we put forward
Speaker 1: our strategy, which was to double our revenue by whilst
Speaker 1: also expanding our margins. So I think if you look
Speaker 1: at some of the data points, it just shows the
Speaker 1: opportunity that there is for general motors. But do you
Speaker 1: think that there, you know, some of the disruption that's
Speaker 1: going on the auto market actually last because of some
Speaker 1: of these upstarts, or do you think time will tell
Speaker 1: in terms of whether or not the traditional automakers that
Speaker 1: are around for a long time ultimately take the lead.
Speaker 1: And just got about thirty seconds and then we'll come
Speaker 1: back and talk some more. Yeah, I think it'll be
Speaker 1: a combination of both. I think there's a lot of
Speaker 1: changes that have happened in the marketplace. There's a lot
Speaker 1: of disruption, there's a lot of new thinking, and I
Speaker 1: think from a general modus perspective, how comes to the
Speaker 1: fact that you know, I do believe that this is
Speaker 1: an exciting opportunity, and I believe that we've got robust plans,
Speaker 1: and I think that we've got plans that will enable
Speaker 1: us to lead. I gotta say it does feel good
Speaker 1: that everybody's all in an electrification, certainly coming off of
Speaker 1: Cup twenty six, and we continue to watch, uh the environment.
Speaker 1: At this point, we're gonna we just got to get
Speaker 1: rid of our I'm ready. I mean, we're definitely ready
Speaker 1: and thinking about the next car Rory Harvey. We're going
Speaker 1: to come back with him. He's global vice president of
Speaker 1: Cadillac overseeing their day to day operations there. This is
Speaker 1: Bloomberg Radio. You want to get back to our guest
Speaker 1: here on business week. Rory Harvey is still with US
Speaker 1: global vice president of Cadillac on the phone in New
Speaker 1: York City. Hey, Rory, you know, I'm thinking about GM
Speaker 1: and they're all in on UM electric vehicles. Cadillac obviously
Speaker 1: a key part of that component UM. I am curious
Speaker 1: about in the transitioning, especially at a time where we're
Speaker 1: talking so much about supply chains. Are you guys able
Speaker 1: at this point to get all the raw materials, the
Speaker 1: minerals and things that you need to easily and continue
Speaker 1: to make this transition and keep to your timeline. Yes,
Speaker 1: So I guess there's a There's a couple of parts
Speaker 1: for that, so I will I'll answer it first in
Speaker 1: terms of relating to semi conductors, which is one of
Speaker 1: the challenges that the closed automotive industry is is facing today.
Speaker 1: So you know that has been a challenge throughout the
Speaker 1: course of one and it's still a challenge today. Having
Speaker 1: said that, I would say that you know, we are
Speaker 1: seeing a better flow of chips now. There's been a
Speaker 1: terrific amount of work that has been done with the
Speaker 1: supply chain, indeed, getting more involved and deeper into the
Speaker 1: supply chain to be able to secure the right level
Speaker 1: of supply of chips and moves and forward. Um. It
Speaker 1: is going to continue into two. But as an example,
Speaker 1: if you looked at North America and our plants in
Speaker 1: North America, we've got the majority of them for general
Speaker 1: motors back up and running, and indeed, as of Monday
Speaker 1: of this week, every single Cadillac plant in North America
Speaker 1: is now operational. So that step one in terms of
Speaker 1: getting inventories to recover so that we can fulfill what
Speaker 1: is very strong customer demand at the moment um. So
Speaker 1: we're looking forward to some stability coming during the course
Speaker 1: of two. There. Then in addition in terms of you know,
Speaker 1: the materials that are required going forward in terms of
Speaker 1: batteries UM. Again, we've made some recent announcements in terms
Speaker 1: of some of the ventures and infrastructures that we're putting
Speaker 1: in place to ensure that we can secure the right
Speaker 1: levels of supply to enable and support the transition as
Speaker 1: we need to and at this particular point in time,
Speaker 1: there is absolutely no delays to our EV platforms in
Speaker 1: terms of rollout schedule. Indeed, I mentioned earlier that we're
Speaker 1: looking to pull the lyric ahead by nine months versus
Speaker 1: the original plan, so we will start producing that vehicle
Speaker 1: in March of two. As Carol mentioned, you've been pretty
Speaker 1: much a General Motors for pretty much your whole career, right,
Speaker 1: that's correct, thirty two years, and so well, contextualize the shift,
Speaker 1: the shift to electric vehicles for us, and how big
Speaker 1: of a shift that's happening inside General Motors and inside
Speaker 1: Cadillac right now? Is this the biggest shift you've seen
Speaker 1: during your entire career? I would say so, Um, you know,
Speaker 1: thirty two years is a long time, and I think
Speaker 1: you know, I would say to somebody that there's been
Speaker 1: more changes in the automotive industry in the last five
Speaker 1: years than there were in the twenty seven years that
Speaker 1: I've experienced before that, and there'll be more changes in
Speaker 1: the next two years than there's been in the last
Speaker 1: five years. So the pace of change is absolutely dramatic
Speaker 1: at the moment. And this is no doubt in my mind,
Speaker 1: the biggest shift that we would have seen in my
Speaker 1: period in the automotive industry. It's interesting what you know
Speaker 1: as we moved through this shift. What is it that
Speaker 1: I guess isn't the major risk to it progressing as
Speaker 1: you hope when you look at you know your timeline
Speaker 1: and as you said, you moved it up for the lyric.
Speaker 1: But what is the biggest risk to all of this? Yeah,
Speaker 1: I think you know one of the the challenges that
Speaker 1: you've got. I'm not sure if I describe it as
Speaker 1: a risk. Is the pace of change and the rate
Speaker 1: of adoption, the rate of infrastructure, the range anxiety UH,
Speaker 1: customer's ability to be able to charge, etcetera. So I
Speaker 1: think there's a number of elements that peeped together in
Speaker 1: terms of the jigsaw, and I wouldn't say that it's
Speaker 1: a risk overrul in terms of the change. I would
Speaker 1: say it's a time and impact in terms of how
Speaker 1: aggressive is the adoption rate of EV is going to
Speaker 1: be UM So I think it's more in terms of
Speaker 1: a question as to when rather than if, Well, you
Speaker 1: know what worry. One thing I do think about and
Speaker 1: there's something to be said like, oh wait, my brother
Speaker 1: just got an e V, right and you start to
Speaker 1: see it and you understand it. I do wonder what's
Speaker 1: the tipping point? Ultimately? Is it that all of a
Speaker 1: sudden you see I mean, I've certainly seen a lot
Speaker 1: more evs on the road that I have in a
Speaker 1: long time. I felt like I used to go to
Speaker 1: California and I'd see a fair amount, But now I'm
Speaker 1: seeing them, I feel like all over the place, and
Speaker 1: there's a variety. Um, but what do you feel like
Speaker 1: will be that ultimate tipping point for Do we need
Speaker 1: the governments to continue to give some kind of you know,
Speaker 1: tax incentive or tax breaker? What is it? Yeah? I
Speaker 1: think again, I don't think it's one thing that's going
Speaker 1: to do the tipping point. I think you're absolutely spot on,
Speaker 1: you know, seeing other people in the vehicles, hearing other
Speaker 1: people's experiences in terms of the vehicles, look at the
Speaker 1: penetrations of e vs over in California. Tax credits are
Speaker 1: obviously something that will help us take in terms of
Speaker 1: being a tipping point for some. Infrastructure will help in
Speaker 1: terms of being a tipping point for some. And I
Speaker 1: think it's a culmination of all these factors. And then
Speaker 1: it's just really a question is to the rate of
Speaker 1: momentum and the rate of change. So I'm just trying
Speaker 1: to think about the rate of change and how fitting
Speaker 1: that into the context of what we think about when
Speaker 1: it comes to the environment. Is it Is it happening
Speaker 1: fast enough? Certainly from our perspective, you know, from a
Speaker 1: from a Cadillac point of view, from a selfish perspective,
Speaker 1: I would like it to happen very aggressively. And that's
Speaker 1: part of the reason that we're thinking about other things
Speaker 1: that we could do to support. So as an example,
Speaker 1: I mentioned, you know, the week before last, we're doing
Speaker 1: an agreement with our dealer partners in terms of how
Speaker 1: we can get more charging out in the local communities,
Speaker 1: et cetera. So we have a number of things that
Speaker 1: we're doing to sort of act as a attists to
Speaker 1: try to help support that change and that that growth
Speaker 1: in them or what is the role of dealers and
Speaker 1: mean Tesla's obviously done it differently you recently, I think
Speaker 1: told writers at GYM expects to have only five D
Speaker 1: sixty dealerships by the end of the year. That's a
Speaker 1: drop from three years ago. What's the role of dealers?
Speaker 1: Does it change and do they need to be all
Speaker 1: in on evs as well in order for this to
Speaker 1: make sense for you guys. Yeah, I think that's a
Speaker 1: great question, and yes, they need to be all in
Speaker 1: on e vs UM. You know, if you go back
Speaker 1: three years ago now, we had close to nine d
Speaker 1: CATALAC dealers in the US. By the end of this year,
Speaker 1: we'll be down to five hundred and sixty six dealers,
Speaker 1: so it will be about a thirty six percent production.
Speaker 1: And I guess the reason for that was working with
Speaker 1: our dealer partners, explaining the future, in explaining the changes
Speaker 1: in terms of customer requirements in change, explaining the the
Speaker 1: investment that's required, et cetera. And you know, on the
Speaker 1: basis of that, we've rationalized our dealer network. We think
Speaker 1: that we've got a great footprint of dealers, which mean
Speaker 1: that customers should be able to get top level service
Speaker 1: wherever they are in the US. But absolute you, our
Speaker 1: dealer partners need to be all in and we see
Speaker 1: our dealer partners as a competitive advantage. Right back to
Speaker 1: where we started. Carol's question, is there a chance that
Speaker 1: we can see an all electric portfolio before? Oh, that's
Speaker 1: a that's a leading question and not one that I'm
Speaker 1: going to give anything away on this particular point in time,
Speaker 1: but I would give you just a snippet of encouragement
Speaker 1: in terms of that I mentioned earlier. That is when
Speaker 1: we will be selling sort of the last of the
Speaker 1: ICE variants, So we will have a significant proportion of
Speaker 1: the portfolio that is ev available in advance of that
Speaker 1: time scale, and I guess a little competition in the
Speaker 1: industry will keep everybody on their toes. Rory, thank you
Speaker 1: so much. We so enjoyed this, and be well, have
Speaker 1: a good, happy and healthy holiday season, and hopefully we
Speaker 1: can check you in with you again on the other
Speaker 1: side of or in there early in the new year.
Speaker 1: That would be really great. Rory Harvey, he's global vice
Speaker 1: president of Cadillac, on the phone in New York.