The numberless HEP-isode, Steel, and Special Guest: Volvo Trucks

On our first-ever numberless HEP-isode, the boys head to opposite coasts to hit bothe the AISTech show in PA and the ACT Expo in Las Vegas, spend some time in an all-new VNL sleeper cab with Volvo Vice President Jared Ruiz, and take a deep dive into what it takes to make electric trucks work in the real world. All this PLUS life at 160 mph with the good people from Chase and Sanborn.

Transcript

Welcome And No More Numbers

SPEAKER_03 0:38

Welcome back to another exciting episode. We gotta stop numbering these. I think that's what I was told was that like if you put another one.

AIST Steel Show And Labor Reality

SPEAKER_02 0:47

I agree. There's no there's no more episode numbers. It's just it's just we're doing them one after the other and people can follow along because they really don't trail into the next one. They're not sequential. They're not meant to be either. They're meant to be we talk about stuff and we move on with our with our normal lives in the industry and then we get back to it.

SPEAKER_03 1:05

Well, speaking of normal lives in the industry, last week was not normal because the hep boys was in two places at once. Young Michael over there was over at the AIS Tech Trade Show talking about steel and steel buildings. I was at ACT Expo on the other side of the country dealing with uh emissions regulations and all kinds of new and exciting products in the trucking logistics trade. Michael, tell us a little bit about AIS tech and what you were doing out there.

SPEAKER_02 1:33

Well, I got a frantic call from the newsroom and they told me to get down there. So you know, the whole idea between the iron steel technology show is that you obviously get to go and talk to people that are in that industry, whether they're making steel, whether they're making steel components, machinery, things like that. And you get to walk around and make a lot of connections. Most of the people, because it's like any industry in the world, everybody knows each other. You know, you see a bump into people that you know, and uh, we had a really nice booth down there that was a partnership with New Core and Stevens and CDMG, and and it was a small steel structure, it had all the different options on it and touchscreen TVs. You go up there and talk to people about building your own industrial space. Um, worked out very well. It's funny because one of the repeating themes that we talk about on the show over and over again, which everyone knows, is labor. So throughout the show, they were talking about labor and how they're you know automating mills because they need labor to be freed up because you've got to be able to put that expertise in other areas. All kinds of things related to that. And wouldn't you know? We we go to the loading dock the night after the show ended. We're supposed to be there at a certain time, and almost 24 hours later, we were loaded, and it was due to an exact thing of labor shortage. They didn't have enough people to clear out the show. And it it just circles back to how important it is to hang on to your people. And if you got people that are worth it to keep them and and figure it out, because those people that stayed, and whether you were taking down booths or you were loading them, or the truck drivers that that waited for 24 hours plus to get their number called to get picked up, those people are dedicated and they're there. Yeah. And you know, when you're in there and my guys were loading the trailers, you know, and they're trying to lend a hand, which they got to be careful of because it's union, so they're they're doing what they're allowed to do to help. Exactly. But they're listening to these guys talk about how they've been working 22 hours straight and they've been working 40 hours because they were at another gig, and then they're not sure when they're gonna get a break because they know they got to go home, but they got to come back because they're setting up the convention center for another show. Those are dedicated individuals, just like the people that were at the uh AISTAC show. You know, you're walking around, you meet these guys who take time out of their lives, they're doing all these things. It put it actually for me, I after that whole fiasp with getting the stuff out of there, which was no one's fault at the show, and nobody's fault were for any of the vendors, other than the fact that the laboring crew couldn't get enough people. It's reassuring that you can stand there and go, well, those that were here cared, I guess is the is a roundabout way of putting it.

unknown 4:11

Yeah.

SPEAKER_02 4:12

And then getting back to the show itself, I mean, you can't get a better group of industry people for for steel and steel-related things together in one area and watch the amount of mingling going on. It was the first time I've ever been there. I walk through the show, people are sending me videos of different stuff, sending me pictures of our booth out there. It's really, really interesting to watch people from different countries or whatever it may be, different backgrounds, all mingling together and talking about the same common thread, which is what are we going to do with the steel industry and how are we going to keep it moving? And no secret what our company does. We're we're a steel contractor that goes out there and helps in steel mills, builds them, maintains them, and does all those things. It's an interesting outlay. And and then you're all the way over on the West Coast at ACT, which is really the same story, just with a different, a different group of people.

ACT Expo Automation Meets Paperwork

2027 NOx Rules And DEF Confusion

SPEAKER_03 5:04

It's a different spin on it, yeah. And one of the big stories that we were covering out there was automation, and not only automation at the port level, not only automation at the container handling level, but even automation at like the most basic like document exchange level, where right now, and I've criticized this a little bit over and over again, you start to see these really advanced, you know, like super truck concepts or the Tesla semi, where you've got the guy sitting in the middle. And that might be aerodynamic, that might be cool, but it doesn't really help you when you got to pull up to a, you know, a border crossing or a security gate and you've got to hand the guy your papers, right? Like you imagine you got to get up, walk all the way around, open the door of the thing, hand your documents, it doesn't really work. But when all of that is done automatically, when all of that is done with an RFID or a QR code, that makes it a little more practical. And we we've definitely seen that. But I think the biggest issue that we saw at ACT Expo really was about the 2027 emissions, because you've got real confusion in the space. And it doesn't matter whether you're talking international, Volvo Penta, Cummins, even Caterpillar, they've all got to meet these 2027 emission regs, these Knox regulations. And at the same time they're doing that, you've got an administration and an EPA that's coming out and saying, well, we're gonna get rid of deaf filters because deaf filters hurt reliability and everything else. Well, that's all well and good. And there, there's there's pros and cons to any kind of regulation like that. But the manufacturers that have been working on these Incans for the last three or four years, number one, they don't know how to make it run without the deaf at this point. Right. And number two, they may have said we're gonna take out deaf, but they have not eliminated that Knox requirement. So how are you gonna meet and certify those emission standards and those Knox standards without the DEF?

SPEAKER_02 7:05

I'm going to go out on a limb here and I'm gonna talk about something that I think is it's never been published. And it's obviously here's the thing you cannot have the Knox requirements that are coming down the line and the Knox requirements that are going to be required in 2030 without certain elements of the after-treatment world. And there was a there was a fleet maintenance council meeting where Volvo was there and they were going over the 2027 stuff. And this was about a month ago, and you saw that too over at ACT. And then the White House comes out and says, Well, no more deaf. We don't need the deaf deal, we don't need this, we don't need that. It's hurting farmers. Farmers are are you know spending billions of dollars on deaf nationwide, all this stuff. But you you bring up a good point. How else are you going to do it? I think the White House is just like sometimes it happens with the different administrations, put their foot in their mouth and said, Well, look, you don't need you, we're not doing this, we're not gonna, we're not gonna require this, blah, blah, blah, but we are gonna require the knocks because we can't get away from it. They know that the technology is shifting, and over time, death may not be a required, may not be a required component of the system. Yeah. I think they're jumping the gun by at least three years. Because as of today, you have to have it. Now, that doesn't mean to say five years from now, new trucks will come out, no death, be a great selling point, but we're gonna handle the after-treatment in a different way. But I get the feeling that somebody over there in that administration found out that there is a possibility that in so many years you don't need it, and they've jumped a gun and said, Well, we just make it so you don't have to have it now.

SPEAKER_03 8:47

Yeah, I think that's a generous way of looking at it. I think that's probably right. I always look at it as like people are extremely dangerous when they have a little bit of knowledge, a little bit of experience. That's my point. Like you learn a little bit about, you know, tuning a car or you start getting excited about that. All of a sudden you've got a catback exhaust, a cold air intake, and a check engine light. You know what I'm saying? Like you mess it up. And and I think that there's a lot of people, and not only in this administration, I'm not trying to pick on them. It's it's it's in all walks of life where you're trying to do the right thing, you're trying to do right by you know, your constituents, your employees, your friends, your partners, your neighbors, your community. And you learn a little bit, you say, well, if this is causing these problems, it's adding these expenses, it's causing trucks to be stuck on the side of the road. If, you know, a few years ago there was a death shortage, guys were just stuck in loop mode, right? Yeah, we talked about that. We talk about that all the time. So somebody's trying to fix that problem by saying we're not going to require it. But they don't understand that by not requiring it, they are setting in a chain of events that is gonna cause a world of headache for a lot of people who are trying to meet these standards that are still in place. Like it wasn't all the way thought through. So I was at this panel with international with Cummins executives, and they were talking about this, and they were saying it's gonna be three or four years before we figure out how to do this without the deaf. And, you know, we had a chance to sit down with Jared Ruiz, he's the uh, you know, VP of Volvo Trucks North America. We'll get to that interview a little bit later in today's show. And we were kind of speculating and talking about it, and he's talking about heating elements, like electric heating elements, like in a toaster.

SPEAKER_02 10:32

Yeah, to heat preheat the emission cycle.

SPEAKER_03 10:35

Yeah. And that was a cool idea because he's talking about, you know, an EPTO that is so much more efficient and reduces the emissions and takes that red dye diesel out of the equation. And then that is going to be something that can feed power back into the system for hoteling and everything else. And it was a really neat conversation. And this idea of like they're already guys sitting on the floor of the show, talking to the engineers, talking to each other across different brands and different engine manufacturers about some of the ways that they can solve this. And to your point, you really only see that at these conferences because those guys will go the rest of the year without ever talking to each other again.

SPEAKER_02 11:17

Yeah, that's my whole point behind that. I mean, you've got people who are literally bumping into each other and they're like, Yeah, you remember we were at AIS Tech? And I do it too. We we go to different trade shows throughout the year. There's a there's some that we go to, and then you bump into those guys and you're like, Remember last year when we went out and had that dinner? It's kind of funny, like you said, you can you could not see somebody for an entire year and pick right back up on them, just like your unfavorite dispatcher when you show up at that dock and the guy goes, I remember you. And it it's kind of interesting. I mean, and we you know, we other thing we talk about too is we talk about energy all the time. And one of the main training focuses for AIS tech in October is going to be energy and its efficient use in the steel industry. They're working on ways to strategize to reduce energy consumption by a mill. If anybody's ever been around a steel mill, the amount of natural gas and electricity they consume is is enormous. Yeah, it's going to become more and more of an issue as everybody consumes more and more energy and electricity. And I think that's why a lot of these shows like ACT, AIST, we have more of them coming up. People need to go to these shows. You need to attend them. I've been in this industry for a while, and this is the first time I went to an AIS tech show. So I'm just walking around and talking to people, and it was very enlightening. You need to make sure you go out to these shows. People, I remember the old days, the older fleet managers and stuff be like, those shows are a waste of time. They don't understand our company. They kind of do, and they probably do more than you realize in very certain segments of it.

Steel Mill Automation And Safer Work

SPEAKER_03 12:56

Well, you just said the magic word, it's those different segments where you know any company is multifaceted, right? And it's real easy if you're on the fleet side of it to focus on the fleet side of it, if you're on the fighting side of it, to get lost in the you know, interests and decimals and all the different spreadsheets. But there are aspects of your business that are not only universal to all businesses, but that are universal to your industry. And there are people out there, especially at these shows, who have like devoted their lives to that one aspect, that one facet of your business. And if you listen to them, you're gonna improve the way that you work. Absolutely. Absolutely. So listen, I've never been to an AIS tech show. It was your first time there. What did you see there that like really stood out to you? Like, man, this is cool. I'm glad I came to this.

SPEAKER_02 13:46

I think the biggest thing that that I saw was you get these, you have some niche guys there, kind of like what you just said before, where they they're talking about very specific things within the steel industry, right? So you can talk about the steel industry as a in a the most dumbed-down fashion where they they well, they make steel. Yeah. But but then you have these guys that are like they're talking about automation. They're talking about how you automate a coil yard, a slab yard, how you move these things back and forth without putting people in harm's way. You can have a facility that makes steel rod to dumb it down for people, which eventually would become rebar or whatever. And rather than have a guy in in a way where he used to have to grab that steel rod as it came through red hot and feed it into another part of the process, they don't have to do that anymore. And, you know, then obviously it has evolved over the last so many years, especially in the last 40 years and then the last 10 years as automation keeps taking over more and more and more. To me, I think it was interesting to see how far the technology has pushed this automation part of these mills. Yeah. I mean, since the 80s, we have had automation where guys are there and they're guiding the machines, but we're talking about autonomous plants that are able to do certain functions of steel creation process without human intervention. All the humans need to be there for is to essentially manage the property, manage the facility, and manage the maintenance of such. That to me, every time I get around this and I and I kind of gravitate towards that and I start talking to people about it. That to me is the most fascinating part of the steel industry right now, today, is how you can take something as wild and could be uncontrollable as molten steel and automatically turn it into something in its particular process without anybody touching it or dialing a dial as they watch it go through and reading a gauge. You know what I mean?

SPEAKER_03 15:55

Yeah. I was like, you know, you made a good point about how potentially uncontrollable all that molten steel is, and it does not take a lot of searching to go online, epic steel plant failure, and you can see some dramatic stuff.

SPEAKER_02 16:11

If anybody has ever seen a steel ladle fail, and molten steel falls out of the ladle through a hole in it, or or whatever the catastrophe problem point was, or you have a piece of molten steel going through a series of rollers, and then that piece of metal falls out of place and gets shoved through the side of the building, those videos are out there, and it is wild to see how uncontrollable it can get when certain forces do not align.

SPEAKER_03 16:44

That's a very subtle way of putting that.

SPEAKER_02 16:47

And when you have when you have rollers and you have all these things and the metal does not conform correctly and decides to go right, and it should have gone straight. There are everybody just needs to go out there and and educate themselves. I mean, you know, we joke about this and when we go through trainings, it's as simple as the forklift training videos that are out there where the guy gets stabbed by a fork and it's a dummy, and everybody's like, Oh, how could that happen? That stuff happens, okay? Oh, yeah. Stupid as a forklift incident is. Imagine a molten steel incident. So bad. And a lot of that has to do with maintenance practices or part failures. It's not a design flaw within the mill. Mill runs every day and then out of nowhere, something happens. I think that what automation allows us to do as a growing industry of technology, it allows you to fine hone your awareness of certain maintenance points that maybe you did not have enough labor to focus on because you were too busy running the plant manually. Well, now the plant's starting to run itself in areas, and you can focus on how to keep that going.

SPEAKER_03 18:00

Yeah. You know, I think unfortunately there is this sense in some circles, and and I'll point some fingers at like, you know, the McKinseys and the Deloits of the world that come in and they supposedly show these big corporations how they can streamline operations and squeeze a little bit more blood out of the turnips, right? But if you have a plant that is putting out, you know, whatever it is, 800 units or 900 units a year, you automate the whole thing and now it's going to 1200 units a year. That doesn't mean you can get rid of a whole bunch of employees. You need to put that to work. No, but that's what happens. All these companies come in, they automate stuff, and they send people home. And then when things go sideways, they act like there was nothing to be done to prevent it.

SPEAKER_02 18:46

Absolutely. Absolutely. I've always been partial to maintenance people, whether they're working on trucks, they're working in parts facilities, tool rooms, maintenance facilities within a manufacturing arena, because they are the front lines to stupidity.

SPEAKER_03 19:05

And they yeah, they are.

SPEAKER_02 19:08

They walk out into and stand there. And I have a I have a video that I laugh about and I send around. But the bottom line is this is the guy who takes a small gulp of uh whatever drink he's drinking and looks around the room and goes, There's been another f you are going to walk out onto the floor, even if you shadow a maintenance crew, and you are gonna learn a lot about a lot of stuff you did not know existed within your organization. And I believe that everybody should be doing that. If you are in a director or a management level, schedule some time, be a little bit flexible because you might go down to the maintenance department on their best day. But if you get a chance to go down to the maintenance department on their worst day, and you get to see when parts don't show up correctly, or the part showed up correctly, but then it turned out to be the wrong part, and then there was an update, and then you have all these other things, and you're working day and night trying to get something back online. You learn a lot about culture, human awareness, working together, problem solving, and logistics. It could be a four-man crew, it could be 50 guys trying to figure out how to get a line back up. You will learn quite a bit with that whole ordeal.

SPEAKER_03 20:24

Yeah, I totally agree with all that. On the flip side of that, in the logistics world, back over to the uh other coast here at ACT Expo, the big conversation was around automation of a different kind. There, you're talking about taking, we're not talking about automation like assembly line robots and that kind of machinery. We're talking about automation of like self-driving vehicles, self-driving forklifts, self-driving trailers. And I think there's a lot of stuff there that, again, it's been two or three years out for the last 10 years, but it it really does seem like it's getting close. You they had you know a couple of trucks out there that would kind of take themselves around the demo course.

SPEAKER_02 21:08

There are very few drivers that drive, and very few of these truck trucking individuals that are professionals that own their own truck and are monitoring trends as they go down the road with their gauges. And oh, this rear diff is getting hot again. I got to take a look at that. Most of the people on the road today are just trying to get there. Yeah. It's hard. You got to make that as easy as possible. You got to make that as easy as getting to where you need to be for the day, stopping, getting cleaned up, taking care of yourself, get back in the truck in the morning, go back out on the road and take off. It needs to be that easy.

Inside The New Volvo VNL

SPEAKER_03 21:45

Yeah. Well, I mean, if you're looking for that level of like kind of comfort and refinement and just getting from A to B and just making it easy, I got to tell you, man, the brand new the Volvo VL that they unloaded for the first time. They showed that off for the first time. That is a gorgeous, gorgeous truck. And to that end, we have got Jared Ruiz. He is the vice president and new technology leader at Volvo Trucks North America. He sat down with us and he gave us an interview from inside the cab of the new Volvo VL electric that they showed off for the first time at ACT. So uh I'll, I'll, we'll break into that. We'll take a little break while that runs and uh Tim edits that in. And uh we'll be back. All right, guys, we are inside the all new Volvo VL sleeper cab. I'm here with Jared Ruiz, he's the senior VP for Volvo Trucks. North America. And this is by far the coolest place I've ever recorded one of these. Thank you so, so much for getting us in.

SPEAKER_01 22:44

Oh, absolutely. Really excited to be here. I mean, this is the right setting you need to be in, right? Really, the top.

SPEAKER_03 22:48

This is the right thing. I almost feel like we're not comfortable enough, but like we're we'll we'll get to that later. Obviously, a big news day last night. We announced the new VNL electric that's coming soon. That's gonna have the EX or the ProTera batteries, which have been working great. I think much more practical, much more in the now. We have the EPTO that's on the VNR electric. That's gonna enable a lot of municipalities that have, or even utility fleets that have tooling, that have bodies and upfit stuff that they want to keep and attachments and implements in order to uh put those on an electric vehicle. I think it's gonna help your upfitting partners. What is the really cool thing about that that we may have missed for someone who's not in the industry, for someone who just sees, okay, EPTO, it's another alphabet soup. What's cool about that?

SPEAKER_01 23:35

Yeah, I mean, what's really exciting about it is for electrification in general, it opens up just so many new doors. Specifically, like you said, for municipalities, for cities, you know, and some of the waste removal and things like that. It allows those cities to be able to further electrify in their fleet where maybe they couldn't before. We had some limitations, right? So uh we know some of our different partners out there, they they have some goals to reduce emissions, right? And they want to do it on a grand scale. Well, we see this as a step forward stepping stone to get further along the line and and continue to build off. But really, I mean, you know, it's a power takeoff unit, uh, the EPTO. We use power takeoff units on diesel trucks that you see today. Uh, this just electrifies that generation. So instead of using diesel power to generate on that uh power takeoff unit, now we're also using electricity to generate that power instead of diesel. So electrify that power takeoff unit to power, for example, a body, a dump, a dump bed that goes up and down, um, a mixer, things like that that that need auxiliary power to operate that piece of the equipment that's not part of the chassis. You know, we normally we produce the chassis, but then we have bodybuilders that produce the bodies. And so this power takeoff unit just really uh bridges that gap in uh delivering the power across the unit to do the job for these cities, for these municipalities and other customers.

SPEAKER_03 25:08

And it's so needed, right? Because even if they want to electrify, now you're telling them that you have to hang a diesel generator off the side of the truck, it doesn't really fit.

SPEAKER_01 25:16

Right, exactly. So uh we knew that there was uh we got to take steps. Like I said, I mean you gotta take steps to get there, and this is that next step. So we're really excited for that because at the end of the day, you want to get to a point where you can you can completely electrify the whole ecosystem.

SPEAKER_03 25:33

Yeah no, it's good. We're at a trade show now, and they're opening the hood because they want to show off this. Uh, this is the the 13 liter, the new 2027 spec motor. So I know we normally talk a lot about electric vehicles and and decarbonization, but this is also decarbonization because you're going now to a very, very strict, I think it's 0.035 Knox emissions on the diesel motor. But rather than restrict horsepower and performance and fuel economy, you've actually improved that over the 2026 model. So let's talk about that a little bit while we have our attention on this giant open hood now.

SPEAKER_01 26:05

Yeah, this is the this is the best part about being in this uh scene here. We we're kind of getting a glimpse of everything you just talked about. The VNLE, which will be this model actually, that we're in, the the cabin chassis. It's this, it's gonna be a similar model, but then it'll be electrified and then we take it further. The same platform that we came out with when we launched the new VNL is spread across all of our new product lines, and that includes our new products going into 2027 that will include the EPA 27 engine. Like you said, lower NOx level. In order to produce a lower NOx level output on the engine, you uh need to increase some things, right? And the output of that engine, you need uh to be able to burn a little bit hotter, and so there's some things that we've done in the after-treatment system to improve how it burns, how efficiently it does that, heaters, and then being able to also on the engine block, we've made some improvements as well. So we want to be able to deliver power and precision and still get the performance that you're used to in a Volvo trucks powertrain that we've had for many, many years and it is very proven. So basically what we're doing is we're taking that proven powertrain and we're just making enhancements. And, you know, I think we've done it in a very good way. I think a lot of people were a little worried, you know, oh, you know, are you gonna lose efficiency on the engine and things like that? Um, you know, which is feedback we've heard from customers out there.

SPEAKER_03 27:29

But well, we saw that a little bit with like the tier three to the tier four emissions, where those tier four motors, when they first came out, those early tier fours, I think the belief was that yeah, maybe they had the higher peak power, but the curve, the torque curve wasn't quite right or wasn't quite what they were used to. Because at the lower RPM, they felt that it was being choked off by the uh the emissions requirements. It seems from what I've seen from the dyno limited dyno stuff that's been shared, it seems like you've avoided that this time and you're still making that peak power and that low-end torque to get you off the line and up to highway speed, for example.

SPEAKER_01 28:03

Yeah, and I think it's uh it's exciting to see that we we see some real gains in the uh regional haul segment when it comes to efficiency, and then in the long haul segment, we already made a big step change to increase fuel economy by you know at least 10%. We even we've seen greater than that in some cases with with some customers. But really, when when you look at it, we have a lot of good experience that we've gained from turbo compounding that we came out with, with other features that we came out with on our D13 prior to 2027. Uh, low Knox engines that we came out with, which was in different steps 0.1 low Knox, 0.05 low Knox engine levels, and now this 0.035 Knox engine level that gave us a lot of experience, a lot of learnings that we were able to just apply to this uh this new release. So, yes, it's it's new to the market, it brings some new features, but also it's a proven powertrain.

SPEAKER_03 28:58

Love that. Back to the electric side. A lot of people have said the new VNL has the E axle, right? For someone who looks at a VNR, they look like at the global markets where Volvo has had that E-axle in place. Does the VNR electric not have an E axle? Is that a standard electric drive to a standard rear axle?

SPEAKER_01 29:19

Yeah, correct. The the current VNR electric model that we've had since we launched in 2020. Uh 30 million miles on that VR. 30 million miles. It's a big lot of a lot of customers, a lot of miles out there in real-world applications delivering goods, picking up product from the port, delivering it to DCs, to different customers. I mean, refrigerated, drive-in, different applications. And that's exciting. So the axles that you see in the VNR electric have been traditional uh axles that you see on a diesel truck, uh, basically. So, and a lot of the strategy that we had going into that when we launched in 2020 is we really wanted to make sure that market acceptance was was good with the drivers initially, right? So that we can get them familiar with electric an electric product, but still feel somewhat familiar with what they're we're with what they're working with and working around. And so now we we see the opportunity to change and shift uh to the e-axle, and we think the market is definitely ready for it. Um, it lines up with just the timing of what we're bringing out to market here and our new platform to really match up well with that. And then also, you know, the whole goal is efficiency gains. Uh, and so the e-axle combined with our battery provider, which is now owned by the Volvo Group, which we acquired, yeah. ProTera batteries will be will be part of that. And so marrying those two together will be a big gain in uh how we gain efficiency in that electric product. And so putting that in the new platform combined with the e axle, combined with the ProTerra batteries, I think we have a really good combination uh to work with going forward. I agree.

SPEAKER_03 31:01

So the one last thing, I know we're coming to the end of our time commitment here. A lot was made of switching from a 12 volt to a 24-volt architecture, ramping up the electric compute power of the truck, going from four ECUs to 30 in the new VNL, and kind of driving that push towards autonomy. Do you see autonomy and electrification working together in the near future, or are you still developing those kind of as separate animals?

SPEAKER_01 31:28

Yeah, I mean, I'd say eventually we'll get there. Uh, I'd say we're not, we're not uh fully there yet on an autonomous electrified vehicle. But uh, you know, you can't ignore the fact that digitalization is is becoming more and more widespread. And that's below the surface here when you really unravel this and you look at how do people interact with products nowadays, and it's becoming more and more digitized. And so even in a heavy-duty truck, we see that trend happening up into the future and becoming more and more uh reliant on over-the-air technology. And so part of that 24-volt shift contributes to that in preparation and being compatible and being able to build off of that platform and be able to bring to market things where we can, you know, we can make a lot of adjustments, changes over-the-air for customers, reduce downtime, increase uptime. It's all with that in mind, right? How do we how do we allow our customers to be able to just be able to keep that that workhorse working all day long and be able to understand that the workforce is also going to be changing, right? There's gonna be uh younger folks coming into the into the industry and and uh wanting to drive truck in in different ways, uh, and they're gonna need to interact with with the product in different ways uh that becomes more digitalized. And then, of course, as far as automation goes, right, I mean, fleets are looking at that, right? So, so we look at fleet demand and and the demand that comes from the fleets is where we want to make sure that we can meet them uh where they stand and where they want to go. So for them and and the way they manage their fleet and the goals that they have in the future based on locations they have, when they have hub to hub for now, uh is where it makes a lot of sense, right? That's the way we're where we're uh implementing today is uh in hub-to-hub situations in certain locations. And we're we just closed in on expanding that to uh some other routes.

SPEAKER_03 33:27

So Houston uh OKC, I think.

SPEAKER_01 33:29

Yeah, yeah, correct. So, you know, that's uh that's coming along. We have the right products to do it. Uh it's really exciting to see that go into place and get the learnings. I mean, we've we've done this before with diesel when we came out with our original diesel products in North America, with our electric product in 2020, and uh and now with uh autonomous solutions over the last couple years as we as we're starting to get more serious about that and to and uh see it piloted in the market and turn from pilot to commercial operations. It's really exciting stuff to see. Uh, and you know, we just the way we look at it is that there's we we look at the three-prong approach that we talk about our high-level strategy, which is uh we see a long life for combustion engines, we see a long life for uh fuel cell electric, and we see a long life for electric vehicles in the longer-term strategy in different applications, different places where it makes sense, right? And so having some uh diversity in our portfolio of what we offer, I think it's important in where we're going and and uh where we want to uh ultimately be, not just uh as a truck manufacturer, but as a society and as with our with our customer base and where where they need us. So we want to make sure that uh we can all be successful together.

SPEAKER_03 34:47

I love that. One last thing, you talked about bringing in a younger drivers, bringing in new drivers to the industry. We talk all the time about familiarizing the drivers with the new technology. As young generations come in, as people are looking at a$250,000 to$300,000 college bill and saying, I'm not really sure how I'm gonna pay that back, and they're starting to come back to the trades and things like driving truck. You're coming up to a point where it's not a question of them being comfortable with new technology, it's them being uncomfortable if the technology isn't there. We have here in the new VNL that we're sitting in, we have digital mirrors, digital side mirrors. Obviously, that takes a ton of frontal area off the truck, improves fuel efficiency even more. We've got touch screens, we've got digital instruments. How else do you see technology working to bring in new operators?

SPEAKER_01 35:43

Yeah, I think um I think in in some of the recruitment that's out there, I think there's some partnerships that are needed uh just in the industry, right? To be able to identify and you know get people excited about it, uh, also educate and you know, be able to show what it really is and what it can be. And then um also, you know, on both sides, right? Yeah, you've also got AI in the background that that can do some things, right, to be able to identify trends and to be able to identify as far as performance when you when you have a a new driver coming into a truck, maybe there's some additional coaching opportunities, right? That's that AI can help with uh as a maybe even in real time. And in real time. Yeah, yeah. And and uh be able to identify and predict, you know, how do we get to predictability and how far out is is uh you know the performance of that engine, how far out of the average are you on based on some of the habits that the driver has, and how can we coach them back into the sweet spot, right? Right in the optimal range, the optimal performance range. And I think there's there's ways that will continue to be refined in the technology we're coming out and the platform that's been built, right? That you can just continue to to grow that.

SPEAKER_03 36:56

But also a more efficient fleet and that's happier operators because they they can be kind of confident in what they're doing, get past that imposter syndrome, and really feel good about the work they do, which I think that pride in what you're doing has been missing for a long time in a lot of industries.

SPEAKER_01 37:11

Yeah, and you know, since I work for Volva, I gotta bring up safety, of course. We gotta go. No, but I mean uh as a driver and you've got these new these new products, new technologies, you want to make sure you feel safe in that. Um and I think we've done a good job of preparing and and bringing to market uh something that is been built in a way that brings the safest experience for drivers that they could possibly imagine. Especially when you think about visibility, uh not just of of you know the windshield and and the shape of the cab and and everything like that, but also you know, the camera systems that we have, proprietary camera system that we have have come up with and make it you know as simple as we can for the driver to stay safe, to make sure that they minimize any damage to the vehicle. I mean, Nixon things like that, they they add up. Um ask any any uh fleet manager or owner, you know, um if you can avoid just you know 20% of that, that's uh that's a win.

SPEAKER_03 38:05

Yeah, and and like in fairness to other companies, you know, internationals in a different league, they're kind of a more mass-produced, but you know, this is not like some 9400 white on white day cab. This is a nice truck, yeah, and you don't want to mess this thing up.

SPEAKER_01 38:19

Exactly. Yeah, I mean it's uh it's a very comfortable ride for the driver, right? They feel uh a little bit at home, right? Is as home as you can on the road.

SPEAKER_03 38:28

You can put it out in the bunk bed, this turns into a little office, you've got the outlets, the refrigerator. Yeah, but if you had a bathroom, you could live in this thing.

SPEAKER_01 38:35

A lot of people don't really think about the lighting, but when you're out on the road for for so many hours constantly, and you have lighting that's really you know, it's uh soft, it's it's uh pleasant to be in. Uh, you know, it doesn't wear you down, you feel a little bit more fresh. I mean, little little details like that, positioning, placement of seats, and even the wood, the layout. This is beautiful wood inlay. All natural wood come from a sustainable source. Um, you know, a lot of folks coming up, the younger generation seem to be more and more into where did the products come, what are the materials that were used in this product uh becoming more and more important to them. Uh, you know, what's the imprint on sustainability and you've done that.

SPEAKER_03 39:16

And where do they go, right? Because Volvo in in a lot of pilot programs has been promoting the circular economy, getting the batteries out into a second life, or else recycling the materials, the aluminum, the steel. So, like all of this kind of comes together. I think that's a really excellent point. In closing, here, I obviously I'm giddy. Thank you so much for letting me climb all over this truck. I'm so hyped up.

SPEAKER_01 39:38

Fantastic to be in here.

SPEAKER_03 39:39

If I was like thinking straight and I was an actual proper journalist, what would I ask you here that Volvo has a really great answer for?

SPEAKER_01 39:46

Uh, I mean, I'd say, you know, one question I'd ask is um, you know, what do you see in the future? Right? Yeah. And I say the future's bright. Oh, totally. And I'd say that there's just, you know, we've only scratched the surface of where this is going. Uh, I I would really say that. Uh with the the amount of investments, the, you know, the manpower that we put into this and the technology, the focus, the design that's gone into this, it's been meticulous. You know, like I say, the the future is very bright for the industry, I'd say, for Volvo Trucks North America, but also for the industry. I mean, we're we're coming into kind of an inflection point, it seems, um, into the industry. And um, you know, there's been a lot of uh, you know, uncertainties, but you you can, you know, we can confidently say as a manufacturer that we we will continue to have the right solutions for the industry, regardless of things happening uh that we can't control. But we will continue to bring the right products to the market and continue to have something that that our customers can take advantage of and continue to operate. So um, yeah, the future is bright.

Post Interview Detour And Banter

SPEAKER_03 41:00

That's awesome stuff. Thank you so much for being on the show. And um, yeah, we'll edit this down and make ourselves sound super smart. What are we drinking today, Michael?

SPEAKER_02 41:09

Uh Wheatley vodka and uh I mean this uh cranberry that I got from the store.

SPEAKER_03 41:17

Is it cranberry juice or is it like cranberry flavored molotov of grape and apple and all that other nonsense?

SPEAKER_02 41:24

It's actual cranberry juice. I try to keep it, I try to keep myself healthy. You know, I gotta get uh in about 10 years, and I've gotta keep it that way, all right? Between the alcohol coming out the end and the cranberry keeping my liver clean, we're all right.

SPEAKER_03 41:45

I've been doing this all wrong. I've been mixing my tequila with moonshine. Oh, yeah.

SPEAKER_02 41:50

No, no, that'll kill you. The vodka and cranberry is the ultimate life extending elixir put forth upon this planet. Put forth upon the planet.

SPEAKER_03 42:03

We need, listen, we need a pre and a post-interview sponsor for these things. Because by the time we come back from the interview break, it's over.

SPEAKER_02 42:12

Listen, when Goody Campbell was down at the end of said uh, you know, Settlerville, whatever name you want to put on it, Patoan or whatever. And and she was down there, you know, smashing her feet and the cranberries and everything else. There was a guy who had some alcohol and he looked down there and was like, damn, Mary, we're gonna need some of that juice. And then she was wearing a red letter. Wow.

SPEAKER_03 42:39

Wow, that was a scarlet letter reference. That was amazing.

SPEAKER_02 42:43

Oh, you didn't see that one coming.

SPEAKER_03 42:44

I didn't even know you could read. Do you think? All right, this is a serious question, right? I used to watch these videos as a kid of people like smashing the grapes and smashing the cranberries with their feet. Because this is a real thing. If if you're like a young cat, you're a Gen Z, you're listening to this, and you don't know how wine is made, the finest wines and grape juices in this world are stopped in buckets and the juice pours out of the bottom and like a live by human feet. These these women that live in need frames, they live with the olive oil, the same kind of thing. They're pressing that and it it's it's with their feet. And when I was a kid, when I saw that for the first time, we went to like you know, wine country or some nonsense and we were doing the tour. And I was so disgusted. I was like, oh God, I'll never drink wine. But as I grew older and I realized that the human foot meant different things to different people, and others did not have the same kind of utilitarian appreciation for feet that I did. Their uh interest in the foot went down a different road, shall we say. Do you think that there's part of that that plays out into these fancy wine prices? Like these are people these were stopped by you know Scarlett Johansson's feet or something?

SPEAKER_02 44:08

So deep down, everyone's a pervert.

SPEAKER_03 44:12

Oh, no question. But about what? We're all different perverts.

SPEAKER_02 44:15

That's my point. And it's about what kind of privasity you chose to go down the the alleyway of and behind the rolling dumpster that Allied Waste has left scandally out in the middle of that sub alley. That's where you find your deepest, darkest desires. That's my take on the whole thing.

SPEAKER_03 44:40

Now a word from our sponsor, US Steel.

SPEAKER_04 45:12

Let's play the bummer.

Tesla Semi Pricing And Payback Math

SPEAKER_03 45:24

That's the kind of lead-in that you want. When you're out there in 1971 and you're building up the contemporary resort hotel out there in uh the swamplands of Orlando, Florida, so that you can run a monorail straight from there, straight shot into the Magic Kingdom, all with the power and flexibility and lightweight utilitarian perfection of grade A American U.S. steel. You know, you just take that monorail right over the perversion garden. Take it from there. We were doing so well. We were like, we were keeping it together. We were talking about trade shows and news items. We were doing about perverts finding their way into the alley. Let's try to rein this thing back in. I don't think we can do it. Well, let's let's try to rein this thing back in a little bit. You know, we have been hearing about the Tesla semitruck and how that was going to be a game changer for a decade. For a decade, yeah, a decade. 2017 was the first time they showed it off in the 2027 model years when they finally rolled it out. Now, I don't know if you've seen this, right? And and obviously I am not they finally released the official EPA rated range and the pricing. So you've got a day cab class eight, 325-mile range, recharges in 40 minutes,$260,000. Yeah, but what's the kilowatt usage on that, baby? It's a 548 kilowatt hour battery. Okay. Then you've got a long range that's an 822 kilowatt hour battery that can charge in 36 minutes on the highest speed charging, full sleeper cab, 290,000. That is like when you're looking, that's not bad. When you're talking that's got a 544-mile range unloaded, 500-mile range loaded. But listen, when you are doing the math, and they have these whole tables and everything spreadsheets to figure this out at 350 a gallon, this thing pays the difference between a comparable diesel after 30 months at five, six, seven dollars a gallon, less than 18 months, this thing pays for itself.

SPEAKER_02 47:48

No, you're right. And and I was gonna say this that there is somebody out there listening to this that goes, shit. I just talked to the Volo guy last week and I'm gonna get a deal on a truck. 290,000 for a sleeper unit, I can buy one for 255. Well, first of all, you can't. Second of all, listen to what Joe just said. If diesel fuel is at 599 a gallon at the pump on the turnpike, and your driver has to stop for fuel, he's gonna stop on the turnpike. And I have heard multiple companies tell me, well, we don't allow our drivers to fuel on a turnpike. Well, let me tell you something. When the light comes on and the guy's on the turnpike, he's gonna stop at the next place and get fuel. That's it. That's how it is. So even if he's off the turnpike, let's say he saves 30 cents, so 560 a gallon today. At 569 a gallon versus 350, an electric truck in the right application absolutely could have a payback in 24 to 28 months. Yeah.

SPEAKER_03 48:49

Without and we're not even talking about, we're not even talking about with like incentives and tax credits. No, no, no, no.

SPEAKER_02 48:54

I'm just fuel safety about purchase price versus no fuel versus no regular maintenance wear, and then eventually we're gonna have to put batteries in it.

SPEAKER_03 49:05

I don't know about that. I mean, if you look at how these batteries are lasting, let me let me rephrase this. Well, I mean it's not gonna last 30 years. No, it's not gonna last 30 years, but will it last 10?

SPEAKER_02 49:19

Totally, I would totally agree with somebody telling me it'll last 10 years.

SPEAKER_03 49:22

Yes, there's no question, and I think a diminished return on your range, yes for sure.

SPEAKER_02 49:28

10 years from now, the thing if it was let's say that between loaded and empty miles, you're averaging somewhere around 750 or or five six fifty.

SPEAKER_03 49:37

It's five hundred five hundred miles, so let's call it 500 miles.

SPEAKER_02 49:40

500 miles. So let's say after 10 years you're down to to you know 390.

Charging Hardware And Battery Longevity

SPEAKER_03 49:45

Yeah, that's still not bad. No, and frankly, here's the other part of this that people don't quite get is that the technology is changing so quickly that the charger itself, there's a company called ABB that makes a whole lot of switch gear and electrical equipment. If you're in the utility space, you know Schneider Electric, you know Hitachi, Carlo Gavazzi, you know uh ABB, right? They make huge transformers and things like that. They have a new charging system, EV charging system, that we looked at at ACT, and it is entirely liquid-cooled. It's got glycol cooling, it's constantly pumping through the machine, it's keeping the temperature down on the cable, it's allowing more current to come through, and it's not cooking the battery. So you can high pressure that, you know, high speed charge those batteries and do it more frequently with less energy loss and less degradation of the battery. You start looking at something like Orange, which has built terminal tractors and airport ground handling equipment now for years, 100% electric. They use a different kind of battery chemistry than what they don't use, like the same lithium ion that's in your car, right? And it's not as energy dense in the sense that, like, for the same-size battery, you don't get the same range, but it keeps its range longer, keeps its capacity longer so it doesn't degrade over time. DHL out here at the Chicago airport has had the same electric terminal truck for 15 years, and you want to talk about maintenance, they've been down two days out of that entire, I'm sorry, 10 years. They've been down two days out of that entire 10 years. That's insane.

SPEAKER_02 51:35

No, that that is insane. And I and one way that you phrased that is is a very good way of having people understand this when you charge at a different pressure that you had said, if you think of it on terms of that, compressive electronic charging, it I think it's a better way for people to wrap their brains around it, actually, because a lot of this battery technology changes between how the battery makeup is devised, right? So you've got lithium ion, like you were saying, you've got these other arenas of battery technology. The trick is what is meant for what type of usage. Yes, and I I really like that because that you have it, you have an issue here where you get a lot of people that are like, that'll never work. Well, it does work, and to your point, exactly. But you're down two days and ten years. I mean, come on. Yeah, it's crazy. If you have the right infrastructure, this comes back to anything. Comes back to the right tool for the right job, my friend. Absolutely. You can have all the diesel trucks that you want, but if you have a crap lot that is knee deep in mud and they're all stuck in the morning, they're not getting out. Yeah. If you have the right charging infrastructure and you have the right layout and you have the right way for the trucks to pull in and they're going line hall runs or they're doing city routes, things similar to that, this will work.

Right Tool For The Right Route

SPEAKER_03 53:03

Yeah. But I think you're saying something that makes a ton of sense. You know, I mean, I talked to this guy, he's the CEO of a company called Green Lane, and he's trying to build out an electric charging corridor, not a hub and spoke setup like we're talking about now, but a true charging corridor. And he's now got the Texas triangle, and he's got basically from Silicon Valley, San Francisco, all the way down to San Diego, and he's expanding this out. It's a multi-billion dollar project, but he's the first one to tell you that right now, if you have very variable routes, you have days where you're trying to get, you know, 800 miles across the country, 1200 miles, coast to coast kind of thing, diesel still is what works for you because that is the ubiquitous, that is where the infrastructure you have to look at it on this level.

SPEAKER_02 53:52

You're exactly right, coast to coast, multitude of different variations. Everybody wants to look at the worst case scenario.

SPEAKER_03 53:59

Look at what you can control. But if you can control it, if you know where you're gonna be and you have a good sense of what the routes are and the variables are, yes, you're crazy not to look at electric in 2026.

SPEAKER_02 54:12

Absolutely.

SPEAKER_03 54:12

I mean, at least look, right?

SPEAKER_02 54:14

At least look.

SPEAKER_03 54:16

Maybe. And we're not talking about we're not talking about save the planet and hug the trees and go, you know, make out with the turtle. We're talking about money, the two types of sustainability. Sustainability in the sense that we got to have a planet to live and breathe on, and fish on and hunt on and camp in and whatever else we like to do, and sustainability, we all got to earn a living. We have to be able to sustain this business. And when you are giving up all your margin on fuel costs, when the price of labor and operations and maintenance is driving everything through the roof, and you can't afford to just buy the most basic stuff, you need to look at solutions like automation, like electrification, or even you know, natural gas and fuel cell and tidal power and solar and wind. You need to look at this stuff to get some of these costs under control so that frankly the common man can afford some kind of joy in their life. Totally agree.

SPEAKER_02 55:16

And I I was just talking about this last week with somebody else in the industry, and I said, This is gonna become so polar opposed. Polarized is the word you're looking for, brother. No, polar opposed, and I'm gonna tell you what. Polar opposed. All right, all right. Do not cut off the wordsmith mid point.

SPEAKER_03 55:39

So I'm gonna give Tim 20 bucks to edit this whole thing out.

SPEAKER_02 55:43

Yeah, so the polar polar opposition of what I'm about to talk about is traveling on the highway today in a truck. You should be working for a company if you're driving. You should be working for a company that has, whether they're a construction company, a freight company, whatever it may be, they could be hauling cow shit. It doesn't matter. They need to have a grasp on what they're doing, where they're going, and have a controlled sense of their day-to-day route and a plan. If you are an owner operator and you are taking loads that need to get to places, nothing is truly planned, but you're prepared. Those are two different worlds. An owner-operator who lives in a world that he has to be prepared for anything and anything is different from a driver who shows up to a company who has prepared him for success. Those are two polar opposite spectrums of traveling the road, which we're talking about. You've got the electrification, which can happen and will work on a well-planned route and a well-sequenced environment. And then you've got the guy who might as well be driving a 1990 K-100 cab over, who has everything that he needs and a camp stove for when he really gets in trouble. And he can go out and traverse the country in different areas in different ways that the electric could never could, but you can't mix the two. Right. People always want to look at that. Well, how am I supposed to go to LA tomorrow with this? Well, you're not right. This is meant to go from Chicago to Indianapolis and back.

SPEAKER_03 57:14

But I mean, it's so funny because they pick and choose these battles. Like, yeah, nobody ever goes into a Walmart looking at a bicycle for their kid, take a look at it and go, Well, they'll never make it to Alaska in this. Exactly. It's nonsense, and like, you know, it really doesn't matter whether you're into guns, whether you're into you know, trucks, whether you're into motorcycles, you've got to have the right tool for the right job. If I was gonna start this podcast again today, I would call it the right tool for the right job.

SPEAKER_02 57:44

I totally get it. I mean, this this is what this no, but seriously, this is what we're talking about. And when you have a company that's got their shit together, this kind of technology progresses naturally. And you at first you're like, Yeah, I don't know how that's gonna work, but I'm sure they have a plan, or I don't know how that's gonna work. I don't think they have a plan, but it works. There are still those cowboys that are out there riding the road at night, making it from city to city, they don't have a good plan because they don't know what the next load's gonna bring them. You can't mix the two worlds, and we were just talking about this because if some of these conditions on the road do not get any better, we might as well be going back to the way it was in the late 60s and early 70s, where you got a camp stove, you may you bring your own food for the week, you got a home base that you find your way back to at some point in a week and a half or two weeks, you refuel everything as far as food and supplies, and you go back out on the road like a nomad.

Driver Pay Parking And Quality Of Life

SPEAKER_03 58:42

Yeah, it's really getting that bad. You know, and it's funny, you start to see these ads when you drive on the highway, you're driving behind a Walmart truck, and you see the thing, come drive for Walmart,$105,000 a year and home every weekend. And I'm looking at that and I'm thinking, man, back in the 90s when I was graduating high school and trying to figure out where I was gonna go in life, that's about what those dudes were making back then. Yeah. So how are you gonna have an industry that in 30, 35 years, the guys are making the same or less than what they were making before? And instead of having a nice truck stop where they can show up and take a shower and get somebody to treat them with respect and get some kind of decent meal, they're getting shoved out onto these highways, no place to park, no decent place to stop and rest and shower and clean up. You get into these corporate truck stops, it's nothing but garbage food processed with five million dollars. Talking about this since the beginning. So I think again, we talked to this guy in Volvo. What we should really do for next time, we should try. I mean, if I look out at the horizon and I say, who of all the fleets out there has their shit the most together? I gotta say Amazon. I'm gonna try to get someone from Amazon on for next week.

SPEAKER_02 59:58

I I totally agree because if you're not working for a company's got their shit together, all you can hope for is that you can find a place when you get off the road at night. And they may have vitro seating within their lobby or within their within their restaurant. Because since 1929, those people have been making stuff, they've been making diner furniture and booths. And when you sit down at the end of the day and you're looking over there and you're sitting and going, man, this place has got their stuff together. That's what you need. You need to have comfort, otherwise, you're shit out of luck and you're sleeping in a hammock underneath the trailer.

SPEAKER_03 1:00:30

No, I you know, it's funny that you the weird rabbit holes you can get into in this industry, as far as like, oh, look at this vitro bar stools, these are the best kind.

SPEAKER_02 1:00:41

Absolutely none of this Timu garbage. That's right. We didn't buy this stuff on Amazon. This was made for the diner, honey. Coffee's brown. I still got pie being made left and right, and we don't want well the mass potato.

SPEAKER_03 1:00:53

It's not it's not brewing, it's percolating.

SPEAKER_02 1:00:55

The masked potatoes may be a little old, but they're still good.

Closing With A Classic Coffee Ad

SPEAKER_03 1:00:59

That'll reheat right up. All right, we'll close off with another word from our longtime sponsor, the good people at Chase and Sanborn.

SPEAKER_05 1:01:10

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SPEAKER_00 1:01:15

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SPEAKER_05 1:01:23

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