WEBVTT - The Electric Vehicle Revolution Is On, and It’s Going to Change Everything 0:00:10.680 --> 0:00:15.200 Hello, and welcome to another episode of the Odd Lots Podcast. 0:00:15.280 --> 0:00:19.720 I'm Joe Wisenthal and I'm Tracy Alloway. Tracy, you know, 0:00:19.800 --> 0:00:23.400 there's this weird thing going on. There's always weird things 0:00:23.440 --> 0:00:25.439 going on. Yeah, I was gonna say, you have to 0:00:25.520 --> 0:00:28.880 narrow it down. I'm gonna I'm gonna narrow it down. 0:00:29.200 --> 0:00:32.800 There's this weird thing going on right now where investors 0:00:32.840 --> 0:00:37.840 are really excited about car companies, even though car companies 0:00:37.920 --> 0:00:40.320 are like barely selling any cars these days because of 0:00:40.320 --> 0:00:45.440 the chip shortage. Yeah. I have noticed this too, particularly 0:00:45.479 --> 0:00:48.839 by the way over um in China, Like, there is 0:00:48.920 --> 0:00:53.320 just a massive amount of capital moving into cars at 0:00:53.360 --> 0:00:58.080 the moment, but it's concentrated in one particular type of car, 0:00:58.200 --> 0:01:01.279 which would be you know, electric nicles or um some 0:01:01.360 --> 0:01:04.360 sort of hybrid plug in type things. Like. We have 0:01:04.480 --> 0:01:09.200 seen so much money move into that space recently, and 0:01:09.240 --> 0:01:13.639 I think part of it is the enthusiasm for tech 0:01:13.959 --> 0:01:17.160 that we saw last year, Right, People are looking for 0:01:17.200 --> 0:01:21.360 those big structural shifts, and the idea of electric cars 0:01:21.520 --> 0:01:25.400 is definitely one of those things. The weird thing though, too, 0:01:25.480 --> 0:01:27.160 And you know, I'll move it back to the US 0:01:27.240 --> 0:01:30.640 perspective for a second is like, okay, everyone knows like Tesla, 0:01:30.840 --> 0:01:33.600 it's done sort of this way. It was way out 0:01:33.640 --> 0:01:37.720 ahead of the space and the legacy automakers have you know, 0:01:38.080 --> 0:01:40.560 are catching up and they're rolling out more and more 0:01:40.600 --> 0:01:43.920 electric vehicles, but like they're getting a lot of credit 0:01:43.959 --> 0:01:47.400 for it, at least recently like four past a billion dollars. 0:01:47.440 --> 0:01:49.640 It's not like these companies are like crushing it yet 0:01:49.680 --> 0:01:51.559 as far as I can tell on the e vs, 0:01:52.000 --> 0:01:54.360 but they're getting a lot of credit for it. And 0:01:54.480 --> 0:01:58.240 as you mentioned, sales exploding in China. It's just investors 0:01:58.720 --> 0:02:01.760 not only seemed to rate like uh be bullshvs, but 0:02:01.800 --> 0:02:04.040 really just think like there's gonna be tons of winners 0:02:04.080 --> 0:02:07.320 into space. It's it's a is a lot of optimism. Yeah, 0:02:07.360 --> 0:02:09.720 well it kind of begs the question as well, like 0:02:09.800 --> 0:02:13.640 how much does it take for an old school car 0:02:13.760 --> 0:02:18.200 company to convert itself into an electric vehicle manufacturer? And 0:02:18.240 --> 0:02:21.400 here I have to admit I really don't know anything 0:02:21.520 --> 0:02:26.320 about the technical differences between building gas powered car versus 0:02:26.440 --> 0:02:29.520 an electric car, but it seems to me like you 0:02:29.639 --> 0:02:34.040 cannot just flip a switch and suddenly go into you know, 0:02:34.200 --> 0:02:38.760 procuring batteries and making e V s. So I'm very 0:02:38.760 --> 0:02:43.240 curious how much of this, this narrative about the old 0:02:43.320 --> 0:02:48.079 school auto companies suddenly becoming e V manufacturers, how much 0:02:48.120 --> 0:02:51.320 of that is hype versus reality. There's so many questions 0:02:51.360 --> 0:02:53.520 I have on that, Like, you know, one of the 0:02:53.520 --> 0:02:56.680 themes that we've talked to on many episodes, especially with 0:02:56.840 --> 0:03:00.320 advanced manufacturing, is this idea of like so of like 0:03:00.320 --> 0:03:03.040 tacit knowledge is something Dan Long talks a lot about. 0:03:03.320 --> 0:03:05.760 Something we've talked a lot about our semi conductor episodes, 0:03:05.800 --> 0:03:08.320 like do you just have the institutional knowledge to abuild 0:03:08.320 --> 0:03:11.040 these things? And then you're right, like there are different processes. 0:03:11.040 --> 0:03:12.560 I remember we had a good story a couple of 0:03:12.600 --> 0:03:16.359 years ago about the unions in Germany being very anxious 0:03:16.360 --> 0:03:19.360 about the EV transition because there are fewer parts in 0:03:19.480 --> 0:03:22.240 theory that means for your workers. So all kinds of 0:03:22.320 --> 0:03:25.480 huge questions about how this is going to work and 0:03:25.520 --> 0:03:30.480 what what the EV transformation will look like, and like you, 0:03:30.880 --> 0:03:33.040 I really just like don't know much about this stuff, 0:03:33.200 --> 0:03:35.320 but it's happening so fast that I think we better, 0:03:35.520 --> 0:03:38.880 we better catch up. Yeah, let's do it, let's do it. 0:03:38.920 --> 0:03:42.760 I am very excited for today's guest, we are going 0:03:42.760 --> 0:03:45.000 to be speaking to Nett Bullard. He is the chief 0:03:45.080 --> 0:03:48.640 content officer at Bloomberg and e F and one of 0:03:48.680 --> 0:03:52.840 the most knowledgeable people here at Bloomberg about all types 0:03:52.880 --> 0:03:57.160 of things ev energy, transitions, energy, tech, cars and all 0:03:57.200 --> 0:03:59.840 of it. Neat, thank you so much for joining us, 0:04:00.320 --> 0:04:03.080 Joe and Tracy, thank you for having me. As I 0:04:03.200 --> 0:04:06.360 used to say in radio, long time listener, first time caller, 0:04:06.680 --> 0:04:09.480 so a treat to be here. Thank you so much. 0:04:09.600 --> 0:04:11.920 So to get it right off the bat, like the 0:04:12.040 --> 0:04:15.800 evy revolution is on right, like this is happening. That's right. 0:04:15.840 --> 0:04:19.040 I mean, we're right now at a position of let's see, 0:04:19.360 --> 0:04:22.240 ten years ago, less than a tenth of a percent 0:04:22.880 --> 0:04:27.359 sales of global cars were electric, and the third quarter 0:04:27.400 --> 0:04:32.120 of last year it was ten globally. And there is 0:04:32.160 --> 0:04:35.400 of course some regional difference within that. As you can imagine. 0:04:36.120 --> 0:04:40.719 China finished the year in December more than EV sales, 0:04:40.760 --> 0:04:42.680 and that's the world's biggest car market. That was three 0:04:42.720 --> 0:04:47.240 point three million evs sold. Europe was about seventeen and 0:04:47.240 --> 0:04:49.320 a half percent. It's probably gonna end of the year, ABU, 0:04:50.640 --> 0:04:53.200 the US and the rest of North America a little 0:04:53.200 --> 0:04:56.240 bit lagging, you know, about ness than four percent in 0:04:56.279 --> 0:04:59.839 the in the fourth quarter or third quarter rather, but Nonethele, 0:05:00.279 --> 0:05:03.520 the trend very clearly is the electric vehicle's friend in 0:05:03.560 --> 0:05:06.280 this case. I mean, this is something that looks like 0:05:06.640 --> 0:05:10.240 a very classic steep part of the ES curve in 0:05:10.320 --> 0:05:14.680 and exponential growth, and it's happening much more rapidly than 0:05:14.720 --> 0:05:17.880 even a lot of people embedded in the space would 0:05:17.880 --> 0:05:21.360 have expected. And so it's really a fascinating time. And 0:05:21.440 --> 0:05:23.760 not just because you know, a lot of units are 0:05:23.760 --> 0:05:27.400 being moved in cars, but because, as you hinted at Joe, 0:05:27.480 --> 0:05:30.599 there are a lot of other industries adjacent to that, 0:05:30.680 --> 0:05:32.719 and I think, you know, we can have time to 0:05:32.800 --> 0:05:36.160 explore that maybe today, that it's so much more than 0:05:36.200 --> 0:05:39.000 just the car in terms of adjacent industries, things that 0:05:39.080 --> 0:05:42.680 flow into and out of this, what it means for 0:05:43.120 --> 0:05:47.240 all kinds of stuff, for the built environment, for behaviors 0:05:47.240 --> 0:05:52.760 that customers have, and for new competitions probably emerging and 0:05:52.760 --> 0:05:56.919 new coalitions emerging between all of these different sectors that 0:05:57.000 --> 0:05:59.880 might previously not have had much of a connection. So 0:06:00.279 --> 0:06:04.600 can I just ask, I suppose the most basic question here, 0:06:04.760 --> 0:06:09.480 and you mentioned that demand for electric vehicles has really 0:06:09.520 --> 0:06:14.160 taken off in recent years. What is driving those sales, Like, 0:06:14.360 --> 0:06:19.080 what is the attraction of an electric vehicle to a 0:06:19.120 --> 0:06:22.960 normal buyer who's out there thinking of getting a new car. 0:06:23.800 --> 0:06:25.880 So there's there's there's probably three things at the point. 0:06:26.120 --> 0:06:32.320 One undoubtedly is policy, so policies that either put limits 0:06:32.400 --> 0:06:35.040 on the amount of emissions per kilometer or mild driven 0:06:35.400 --> 0:06:39.800 in some jurisdictions, or policies that incentivized buying an EV, 0:06:39.960 --> 0:06:42.559 which is a relatively common thing here in the United 0:06:42.560 --> 0:06:45.720 States at the federal and the state level. The other 0:06:46.200 --> 0:06:50.440 is this sort of industrial reorganization that some companies have 0:06:50.640 --> 0:06:52.760 done around this that just sort of made it a 0:06:52.800 --> 0:06:56.440 decision that, you know, going towards things that are mechanically 0:06:56.600 --> 0:07:00.240 simpler may be advantageous for their for their few, your 0:07:00.279 --> 0:07:03.840 production um. And then there's also, you know, the element 0:07:03.920 --> 0:07:07.120 that consumers. It turns out in many cases actually like 0:07:07.440 --> 0:07:11.200 the electric vehicle experience, and I think we should probably 0:07:11.480 --> 0:07:15.560 widen out what that experience means. Obviously, driving wise, it's 0:07:15.680 --> 0:07:19.320 very different. It's almost impossible to find somebody who's driven 0:07:19.360 --> 0:07:21.680 an EV for the first time. It doesn't say, Wow, 0:07:21.720 --> 0:07:24.840 that's a great driving experience. But it's also a buying 0:07:24.880 --> 0:07:28.080 experience that's very different for many people. And you know, 0:07:28.160 --> 0:07:31.240 it's it's something that that falls into a an interesting 0:07:31.240 --> 0:07:34.800 place I think in our individual capital stack. Like for 0:07:34.920 --> 0:07:37.560 most people, of cars probably the second biggest thing that 0:07:37.640 --> 0:07:41.320 they acquire in their life after a house. But most 0:07:41.320 --> 0:07:44.480 people were probably acquiring more cars than they are houses 0:07:44.520 --> 0:07:46.800 every time. And there's all kinds of other stuff that 0:07:46.840 --> 0:07:49.040 goes with it. There's he the hedonic signaling of who 0:07:49.080 --> 0:07:51.320 you want people to think you are, what you are 0:07:51.320 --> 0:07:55.000 aligned to. You know, how do you drive technology? I mean, 0:07:55.040 --> 0:07:57.280 anybody can have an iPhone, not everybody can yet have 0:07:57.760 --> 0:08:00.400 an electric vehicle, but you you can do a lot 0:08:00.440 --> 0:08:02.720 of signaling with it. And and one thing that I 0:08:02.760 --> 0:08:05.760 think is unique and talking about this big sector that 0:08:05.960 --> 0:08:10.400 intersects all these other relatively stayed things like electricity or 0:08:10.440 --> 0:08:14.760 oil and gas, is that there's an element of personal 0:08:14.880 --> 0:08:18.160 choice here and style. But that is a challenge for 0:08:18.240 --> 0:08:20.840 a lot of long term planners to think of because 0:08:21.080 --> 0:08:23.440 it's never really been a thing. It hasn't hasn't been 0:08:23.520 --> 0:08:25.960 much of a powertrain choice in cars from like a 0:08:26.040 --> 0:08:30.000 hundred and twenty years really until really right now. So 0:08:30.120 --> 0:08:34.520 I strongly. I still have a regular annult car internal 0:08:34.559 --> 0:08:36.839 combustion engine, but I think, you know, the next time 0:08:36.880 --> 0:08:38.160 I got a car, it's gonna be an e V. 0:08:38.440 --> 0:08:41.520 And I had that experience where I drove someone's and 0:08:41.520 --> 0:08:43.720 it's just like so smooth and nice. And then I 0:08:43.720 --> 0:08:45.240 went back to my car and it's like, you know, 0:08:45.280 --> 0:08:46.880 did that thing where like sort of like coughs and 0:08:46.960 --> 0:08:49.240 hiccups to start type And as I got and you 0:08:49.280 --> 0:08:51.520 know what, it felt like. It felt like going from 0:08:51.640 --> 0:08:54.439 an iPhone back to like a flip phone. It was 0:08:54.480 --> 0:08:58.079 just like, well, and I this analogy is not bad, actually, Joey, 0:08:58.320 --> 0:09:01.120 you've gone back to candy bar que is and physical 0:09:01.240 --> 0:09:06.599 clicks as opposed to a seamless kind of universal service experience. 0:09:07.320 --> 0:09:09.360 So you hinted at this and then you said something 0:09:09.360 --> 0:09:11.480 specific and like, Okay, this is going to hit so 0:09:11.559 --> 0:09:15.439 many different adjacent industries because it's not just a technological change. 0:09:15.520 --> 0:09:18.959 It's going to change everything. You said, the buying experience 0:09:19.080 --> 0:09:22.000 is fundamentally different, which of course calls to mind the 0:09:22.160 --> 0:09:25.160 power of the dealer networks of the legacy automakers. We 0:09:25.200 --> 0:09:28.040 know that dealers are politically powerful, and you know there's 0:09:28.080 --> 0:09:30.680 this sole established way people go to a car and 0:09:30.720 --> 0:09:34.200 they haggle and they get off and you know, uh 0:09:34.480 --> 0:09:37.280 a year of satellite radio, et cetera. What makes the 0:09:37.280 --> 0:09:41.560 buying experience unique for evs? Why will that inevitably change? Well, 0:09:41.559 --> 0:09:43.320 I should I should qualify that a little bit, which 0:09:43.320 --> 0:09:46.520 is that it's it's for the hure play EV companies, 0:09:46.679 --> 0:09:49.319 they're just doing direct sales. The challenge I think is 0:09:49.360 --> 0:09:52.160 going to come about for a GM or a FORD 0:09:52.280 --> 0:09:55.760 or a VW group that obviously has this huge embedded 0:09:55.760 --> 0:09:58.640 dealer network that it works with that wants to sell things, 0:09:59.080 --> 0:10:01.680 you know, to get the to get that undercoat, to 0:10:01.800 --> 0:10:04.920 get the four mats thrown in. You know, you've got 0:10:04.920 --> 0:10:07.720 to maybe cut a deal on your your service schedule 0:10:07.840 --> 0:10:10.440 or something like that. So you've got kind of two 0:10:10.440 --> 0:10:13.520 poles set up, which is one we haven't we have 0:10:13.600 --> 0:10:16.800 a new product, and if we're going to stand up 0:10:16.800 --> 0:10:19.520 in a new market, why not just do it differently? 0:10:19.520 --> 0:10:22.080 I mean, the Internet does exist for all of these companies, 0:10:22.760 --> 0:10:25.360 and if you can kind of force a lot of 0:10:25.360 --> 0:10:27.760 your energy and attention into the web interface, you can 0:10:27.800 --> 0:10:32.439 probably save on other things versus you know, putting putting 0:10:32.440 --> 0:10:35.760 the car into a new electric car into a universe 0:10:35.800 --> 0:10:40.920 of other existing models, wherein you're presenting a choice within 0:10:41.080 --> 0:10:43.640 a brand that may be kind of challenging, and that 0:10:43.800 --> 0:10:47.480 itself implies all kinds of different stuff about how well 0:10:47.559 --> 0:10:51.120 does the sales staff know to sell an enter field book? 0:10:51.160 --> 0:10:54.080 Do they know that, do they know the KPIs to 0:10:54.240 --> 0:10:58.600 talk about when they're pitching it, do they know the specs? 0:10:58.760 --> 0:11:01.079 And also do they know what kind of experienced sort 0:11:01.080 --> 0:11:03.400 that they could promise down the line. But there's a 0:11:03.400 --> 0:11:06.320 wrinkle to that, which is that you know, um, you 0:11:06.400 --> 0:11:08.760 handed at this in your introduction. You know, uh, the 0:11:08.800 --> 0:11:11.720 engine and a BMW has got hundreds of moving cards, 0:11:12.200 --> 0:11:15.920 the murder in electric vehicle has a few dozen, and 0:11:15.960 --> 0:11:19.439 the battery itself is something that has much less complication 0:11:19.520 --> 0:11:22.160 to it in one sense, in terms of mechanical moving 0:11:22.240 --> 0:11:25.640 parts than the entire power train of an internal combustion 0:11:25.679 --> 0:11:28.240 engine vehicle. And that's a long way of saying that 0:11:28.280 --> 0:11:32.720 there's a huge amount of embedded attention and business in 0:11:32.920 --> 0:11:36.880 the maintenance schedule for keeping a bunch of hot, contacting 0:11:36.920 --> 0:11:41.840 metal parts that need lubrication and precision matching to work. 0:11:42.760 --> 0:11:44.960 In the business like that, that's a huge part of 0:11:44.960 --> 0:11:47.160 the business. In fact, the last time I got an 0:11:47.160 --> 0:11:50.880 internal combustion engine car, I have a Subaru outbag. I 0:11:50.920 --> 0:11:53.800 actually had to essentially sign a waiver top out of 0:11:53.920 --> 0:11:56.120 the maintenance schedule that they wanted to try to sell me. 0:11:56.520 --> 0:11:58.959 Because that that's a big part of the recurring revenue 0:11:58.960 --> 0:12:03.200 relationship that are the card dealers have with individuals. So 0:12:03.760 --> 0:12:07.560 we we've we've created this this inherent tension between not 0:12:07.600 --> 0:12:10.319 only what you're selling, but how you're selling, and also 0:12:10.480 --> 0:12:12.320 what people need to know and how they need to 0:12:12.320 --> 0:12:14.800 convey that selling experience and stuff like that. And yes, 0:12:14.880 --> 0:12:18.480 it's gotten a huge amount of pushback from the dealers 0:12:18.520 --> 0:12:21.600 and as you, as you indicated, dealers are very very 0:12:21.600 --> 0:12:24.840 powerful locally. I mean pretty much every jurisdiction in the 0:12:24.880 --> 0:12:28.280 United States has got some kind of card dealer in it, 0:12:29.080 --> 0:12:32.880 versus not every jurisdiction having say, an auto manufacturer in it, 0:12:33.000 --> 0:12:53.160 and even fewer that have purely electric manufacture. So, just 0:12:53.280 --> 0:12:57.679 on a related note to the differences in the buying experience, 0:12:57.720 --> 0:13:00.680 could you maybe walk us through the different fronts in 0:13:01.280 --> 0:13:06.199 manufacturing a traditional car versus an electric vehicle. And I 0:13:06.640 --> 0:13:10.200 guess one thing I'm curious about is whether or not 0:13:11.360 --> 0:13:18.000 something like building e vs actually requires a different work culture, 0:13:18.160 --> 0:13:22.280 I guess, to building traditional vehicles. You know, people think 0:13:22.320 --> 0:13:27.520 of companies like Tesla as hardcore tech, you know, really innovating, 0:13:27.760 --> 0:13:31.360 doing something new, and when people look at GM, they 0:13:31.360 --> 0:13:33.679 tend to think of an old school car company, and 0:13:33.760 --> 0:13:37.160 it just seems like there's a big cultural divide there. 0:13:37.920 --> 0:13:40.920 Now there's there's absolutely a big cultural divide, and I 0:13:40.920 --> 0:13:42.800 think we should sort of clarify a couple of things. 0:13:42.800 --> 0:13:46.600 So manufacturing the body of a car, if it's going 0:13:46.640 --> 0:13:49.920 to be stamped steel, you know, if you're going to 0:13:50.000 --> 0:13:53.040 be putting seats into it, if it's going to have 0:13:53.080 --> 0:13:56.600 windshields and windscreens, it's going to have wheels and tires 0:13:56.640 --> 0:14:00.880 and breaks. These things are largely coming from the same 0:14:00.960 --> 0:14:03.840 kind of supply chains and the same type of manufacturing. 0:14:03.920 --> 0:14:06.800 But it's kind of the core I p. And I 0:14:06.840 --> 0:14:11.320 would also say a lot of the corporate identity elements 0:14:11.400 --> 0:14:14.160 that are kind of in fundamental conflict as you move 0:14:14.600 --> 0:14:17.840 from internal combustion engine to e v s, and that's 0:14:18.280 --> 0:14:25.640 the replacement of this massively complex and massively precise set 0:14:25.680 --> 0:14:28.560 of things that have been optimized for more than a 0:14:28.640 --> 0:14:33.880 hundred years to take things, take a fuel aeroson wise 0:14:33.960 --> 0:14:38.720 it exploded, turn that into momentum that then it makes 0:14:38.760 --> 0:14:41.840 the vehicle move, and that then also in the process 0:14:42.240 --> 0:14:46.120 dissipates heat, gets rid of gases and all these things, 0:14:46.920 --> 0:14:50.640 and in the process of course, moves the vehicle, replacing 0:14:50.640 --> 0:14:56.360 it with a large, sealed up more or less inert 0:14:56.600 --> 0:15:01.800 slab of electronics that is oftentimes integrated somewhere else. And 0:15:01.840 --> 0:15:05.360 then motors that may or may not be made in 0:15:05.480 --> 0:15:09.240 house by an auto company and then put together in 0:15:09.280 --> 0:15:11.440 a in a in a package that looks the same 0:15:11.480 --> 0:15:13.680 on the surface and that does the same job. It's 0:15:13.680 --> 0:15:17.600 still moving a car, but that definitely kind of changes 0:15:17.720 --> 0:15:22.240 the frontier of where companies see a lot of their identity. 0:15:22.320 --> 0:15:24.920 Like a great example here is that as that Honda 0:15:25.000 --> 0:15:28.080 in Korea has just closed, it's R and D center 0:15:28.600 --> 0:15:31.760 that develops new internal combustion engines that they've had this 0:15:31.840 --> 0:15:35.400 for thirty nine years, Like this was a massive part 0:15:35.480 --> 0:15:38.680 of the company's identity to be stood up as an 0:15:38.680 --> 0:15:43.280 independent company was to do this. You know, the chief 0:15:43.280 --> 0:15:45.400 of R and D there said that, you know, it's 0:15:45.400 --> 0:15:48.960 an inevitable to convert into electrification, and that our engine 0:15:48.960 --> 0:15:51.560 development is a great achievement, but we must change the 0:15:51.640 --> 0:15:55.640 system to create future innovation based on this great asset 0:15:55.720 --> 0:15:59.280 from the path. So I guess it's a big psychological moment, 0:15:59.440 --> 0:16:03.360 like you know, what, what battle are you fighting technically 0:16:03.400 --> 0:16:06.680 within the automobile? Is it for greater efficiency? Is it 0:16:06.720 --> 0:16:10.520 for more speed and power and torque? All of those 0:16:10.520 --> 0:16:13.800 things that used to run through hundreds of moving parts 0:16:13.840 --> 0:16:19.280 being integrated into an engine and through a very sophisticated 0:16:19.360 --> 0:16:22.600 R and D apparatus are now having to rotate completely. 0:16:22.680 --> 0:16:27.520 And it is a really important question to ask, like 0:16:27.680 --> 0:16:30.040 how much of that can carry over from one place 0:16:30.080 --> 0:16:33.480 to another. Now, assembling a car carries over, but making 0:16:33.640 --> 0:16:36.120 and making a battery pack and a motor maybe just not. 0:16:37.080 --> 0:16:40.040 So you actually just mentioned one question, Um that I 0:16:40.080 --> 0:16:43.880 wanted to ask, which is where do batteries actually come 0:16:43.920 --> 0:16:48.200 from for electric vehicles? And do any e V manufacturers 0:16:48.480 --> 0:16:52.880 actually make their own batteries. Yes, Tescam makes its own 0:16:53.200 --> 0:16:56.160 for long term of course, in partnership with Pana sonic Um. 0:16:56.200 --> 0:16:59.200 There are a number of manufacturers not far from you 0:16:59.600 --> 0:17:02.720 in southern China, S A, T, L and B y D. 0:17:03.280 --> 0:17:07.000 There's there's an increasing interest in doing manufacturing in Europe 0:17:07.040 --> 0:17:11.000 and some here in the America's as well. And again 0:17:11.000 --> 0:17:13.160 this this will be an intriguing question to see how 0:17:13.160 --> 0:17:16.240 it plays out in terms of do companies have our 0:17:16.280 --> 0:17:19.119 company is able to I don't know, better leverage their 0:17:19.160 --> 0:17:22.919 supply chains by being diverse, having a number of suppliers, 0:17:23.119 --> 0:17:25.520 or are they better off taking everything in the house, 0:17:26.040 --> 0:17:28.760 you know. On the motors side, the analogy would be 0:17:28.800 --> 0:17:31.280 that many automakers may do their R and D, but 0:17:31.320 --> 0:17:36.000 they have a third party here, one supplier that manufactures motors. 0:17:36.000 --> 0:17:38.040 So it's you know, it's a bit of it's a 0:17:38.040 --> 0:17:41.560 bit of both at the moment. But but again it's 0:17:41.640 --> 0:17:44.520 very very different, and it's very highly concentrated at the moment, 0:17:44.960 --> 0:17:48.680 given given the fact that so much of this capability 0:17:48.840 --> 0:17:52.160 is it China and the rest of East Asia. God, 0:17:52.280 --> 0:17:55.400 you know, there are so many different avenues we could 0:17:55.440 --> 0:17:57.359 go down, and already feel like Tracy, We're gonna have 0:17:57.400 --> 0:18:00.360 to do like ten episodes this here, because I'm sure 0:18:00.400 --> 0:18:03.240 I could ask an hour's worth of questions necessarily, like 0:18:03.240 --> 0:18:07.639 just on battery manufacture and then of course the chemicals 0:18:07.680 --> 0:18:11.920 and commodities that go into battery manufacturer. So like it's already, 0:18:11.960 --> 0:18:13.960 like my head is like spinning out at different thoughts. 0:18:14.000 --> 0:18:16.560 But I want to go back to this question of 0:18:17.200 --> 0:18:22.440 what becomes of a of a automaker's identity in this 0:18:22.640 --> 0:18:24.960 sort of evy world. And something I'm sort of like 0:18:25.000 --> 0:18:28.320 wondering about is, you know, and like the late nineties 0:18:28.640 --> 0:18:32.320 with the personal computer, and suddenly it's like, okay, everyone 0:18:32.400 --> 0:18:35.560 just like puts the same operating system in the computer, 0:18:35.920 --> 0:18:38.840 and everyone puts the same Intel chip in it, and 0:18:38.920 --> 0:18:42.560 suddenly all these like computer makers more or less lose 0:18:42.600 --> 0:18:44.960 their identity, and you know, we can sort of remember 0:18:44.960 --> 0:18:46.960 all the ones that fell by the wayside, like Compact 0:18:47.000 --> 0:18:50.800 and so forth. Is there a risk that that happens 0:18:50.960 --> 0:18:54.080 in autos where the tech sort of is really happening 0:18:54.160 --> 0:18:57.480 somewhere else and they're sort of like assembling the same 0:18:57.520 --> 0:18:59.880 parts as everyone else and don't really have any sort 0:18:59.920 --> 0:19:03.760 of unique purpose anymore. It's a really great question, And 0:19:03.760 --> 0:19:05.840 I actually like this analogy because I can put it 0:19:05.920 --> 0:19:08.560 right back into a question, which is, if we think 0:19:08.600 --> 0:19:10.920 back to the late nineties, was there anybody who came 0:19:10.960 --> 0:19:14.040 be it as like I'm a compact guy. Sorry, you know, 0:19:14.359 --> 0:19:16.919 I'm a gateway. I'm a gateway man, my family has 0:19:16.920 --> 0:19:19.240 been a gateway. Man that song I'm ever going to 0:19:19.400 --> 0:19:23.120 use for my desktop PC. Like Dell almost got there, 0:19:23.160 --> 0:19:26.159 They'll almost got dude, You're getting a Dell, right, Yeah, 0:19:26.160 --> 0:19:29.280 that was the closest it almost got there. I would 0:19:29.280 --> 0:19:32.680 say Apple has definitely carved that territory, even for people 0:19:32.680 --> 0:19:35.240 who spent some sort of years in the technical wilderness 0:19:35.320 --> 0:19:39.199 with with Apples. But I think the auto identity is 0:19:39.240 --> 0:19:41.679 not only deeper, but I mean it is really like 0:19:41.800 --> 0:19:46.880 multi generational. My family as F one, not for it's 0:19:47.119 --> 0:19:51.760 F one, and they've had since we since my stepfather 0:19:51.800 --> 0:19:55.600 was buying them off construction site seventies. Like that identity 0:19:55.720 --> 0:19:59.200 is as old as I am in a sense, and 0:19:59.280 --> 0:20:02.640 so is definitely a challenge for the big manufacturer, which 0:20:02.720 --> 0:20:05.760 is you know where where does the kind of the 0:20:06.119 --> 0:20:11.160 loyalty lie within? That is case in which people saying 0:20:11.160 --> 0:20:12.800 like I love the F one fifty, but now that 0:20:12.800 --> 0:20:16.360 it's gone electric, I won't buy anything from four or 0:20:16.480 --> 0:20:19.000 on the other hand, and this is data from Ford 0:20:19.560 --> 0:20:23.520 last month, is it the case that by electrifying an 0:20:23.800 --> 0:20:28.440 iconic nameplate the Machi and the F one fift lightning, 0:20:29.040 --> 0:20:32.240 are you able to new people to your brand and 0:20:32.359 --> 0:20:35.679 actually think fourd's case is really instructive because they've got 0:20:35.680 --> 0:20:39.120 about two reservations for the F one Lightning and THEE 0:20:39.480 --> 0:20:41.600 for those of you outside the US, is the best 0:20:41.680 --> 0:20:44.840 selling car or vehicle in the United States for more 0:20:44.880 --> 0:20:49.440 than four decades. They have two reservations, of which sev 0:20:50.640 --> 0:20:54.800 of the customers are new to Ford, which is pretty 0:20:54.840 --> 0:20:57.240 extraordinary if you if you think about it from a 0:20:57.320 --> 0:21:01.960 captured perspective, being able to sure market in doing that 0:21:02.200 --> 0:21:07.440 is pretty great if you're looking at this as a manufacturer. 0:21:07.920 --> 0:21:10.920 That said, there's always the risk of, I think the 0:21:11.000 --> 0:21:14.000 kind of the E V one experience, which is also 0:21:14.040 --> 0:21:19.879 from the late nineties, of delivering a subpar experience and 0:21:21.119 --> 0:21:26.159 not necessarily self sabotaging it, but under selling it. And 0:21:26.160 --> 0:21:28.680 that could take the form of deliberately saying this is 0:21:28.720 --> 0:21:31.320 a compliance vehicle and we're not really interested in it, 0:21:31.680 --> 0:21:33.879 to kind of the soft pedal version, which is people 0:21:33.880 --> 0:21:36.000 just don't know how to sell it, but I but 0:21:36.080 --> 0:21:40.480 it seems to be that that with the electrification of 0:21:40.520 --> 0:21:42.800 the two best selling the F one Fifting Lighting and 0:21:42.840 --> 0:21:46.480 the Chevy Silverado full size truck, that you've got this 0:21:47.280 --> 0:21:51.080 and this sort of interpoment of new things into into 0:21:51.119 --> 0:21:54.000 an old not just brand, but an old nameplate that 0:21:54.040 --> 0:21:56.480 people have a lot of loyalty to. So I think 0:21:56.480 --> 0:21:58.720 it's going to be extremely interesting to see how this 0:21:58.800 --> 0:22:01.560 plays out. Because of the time. Of course, you have 0:22:01.880 --> 0:22:05.399 companies building off of their own like what Eon Musket 0:22:05.440 --> 0:22:07.639 call first principles for e v s and that's not 0:22:07.680 --> 0:22:11.359 just obviously tested, but that's Ribban, that's Lucid. You know, 0:22:11.440 --> 0:22:14.400 the two friend vehicles of the years on the truck 0:22:14.440 --> 0:22:17.000 with the Lucid air car and the Ribban R one 0:22:17.040 --> 0:22:21.600 P truck. So with all this attention on electric vehicles, 0:22:21.640 --> 0:22:24.959 investors getting very enthusiastic about the space, as Joe mentioned 0:22:25.000 --> 0:22:29.480 in the intro, lots of money flowing into it. Do 0:22:29.560 --> 0:22:32.000 we see any signs or should we be at all 0:22:32.040 --> 0:22:35.480 concerned about over supply? And one of the reasons I 0:22:35.520 --> 0:22:38.800 ask is because in China at least, we have seen 0:22:39.040 --> 0:22:43.720 some ev companies that you know, set themselves up, attracted 0:22:43.880 --> 0:22:47.480 a lot of initial investment, and then seemed to very 0:22:47.600 --> 0:22:51.320 quietly shut down. And I guess one follow up question, 0:22:51.400 --> 0:22:54.640 and it's related to your point about brand loyalty earlier, 0:22:54.680 --> 0:22:58.600 but what does being competitive in the e V space 0:22:58.720 --> 0:23:02.320 actually look like. And how do you differentiate between winners 0:23:02.440 --> 0:23:05.760 first as losers as far as the knots of brands 0:23:05.880 --> 0:23:08.480 popping up and then quietly going away. Well, that looks 0:23:08.600 --> 0:23:11.000 very much like the early days of the auto industry, 0:23:11.160 --> 0:23:15.000 right large. You know, when we had hundreds of manufacturers 0:23:15.000 --> 0:23:17.359 in the United States, and you know, some of them 0:23:17.440 --> 0:23:20.119 lasted longer than others. There were packards around and then 0:23:20.160 --> 0:23:24.439 our parents were born. But you know, Stuts as a 0:23:24.480 --> 0:23:28.399 brand is no longer with us, Detroit Electric is no 0:23:28.480 --> 0:23:31.600 longer with us. There are are more things that fall 0:23:31.720 --> 0:23:33.679