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EP012 - Electric Vehicle Analyst at EVAdoption, Loren McDonald http://www.vehicle2.getspiffy.com Episode 12 is an interview with Loren McDonald, Electric Vehicle Analyst at EVAdoption; recorded on July 1st, 2019. Loren and Scot dive deep into the world of EVs, including such topics as: The growth of total EV market share in the U.S., broken down by state. Exploring Loren’s CARMA EV adoption framework. Breaking down lithium-ion vs solid-state batteries, as well as their 7-year cost trajectory. Emerging companies like Rivian and Workhorse, who are pushing for EV usage in non-traditional segments. The expansion of EV charging infrastructure, including where charging stations are growing and where they’re still needed. Tracking federal EV tax credits as they begin to phase out. Check out Loren’s work at EVAdoption.com, as well as his book Gas Station Zero! If you enjoyed this episode, please write us a review on iTunes! The four pillars of Vehicle 2.0 are electrification, connectivity, autonomy, and changing ownership models. In the Vehicle 2.0 Podcast, we will look at the future of the auto industry through guest expert interviews, deep dives into specific topics, news coverage, and hot takes with instant analysis on what the latest breaking news means for today and in time to come. This episode was produced and sound engineered by Jackson Balling and hosted by Scot Wingo. Transcript: Scot: [00:56] Welcome to the Vehicle 2.0 Podcast. This is episode 12 and it's being recorded July 1st, 2019. Welcome back Vehicle 2.0 listeners. Uh, we're recording this here in early July. Hopefully this has given you some content for your July 4th travels. Uh, in this episode we have a real exciting treat for you. We're excited to welcome on the show, Loren McDonald. He's the author of the book "Gas Station Zero", editor and contributor to EVAdoption.com contributor to Clean Technica and an all around EV expert. Welcome to the Vehicle 2.0 Podcast. Loren! Loren: [01:31] Great. Thanks for having me, Scott. Really excited about the conversation today. Scot: [01:35] Yeah, me too. We've, uh, I've, I've been a f a Twitter follower and, and read a lot of your content. Um, you know, I think what I've found as I've dug into, I come from the ecommerce world and as I've dug into this world, uh, there's, there's not many people that actually have original content. There's a lot of republishing of the same kind of stuff. And, uh, what I love about your content is, you know, very originally sourced and in a lot of unique thinking there. Before we dig into that though, um, let's talk about your career path. What, what got you into this automotive motive space and writing on this topic? Loren: [02:10] Yeah. So I, I'm, you know, complete outsider, if you will, to the, the automotive and in EV world. I started my career in marketing and PR way, way back in 1984. So 35 years into kind of my, my marketing consulting career have been, uh, you know, CML marketing executive consultant at, uh, a variety of companies over the years. Mostly sort of BDB professional services. But the last a sort of 15, 20 years in the marketing technology space, um, and really kind of the last 15 years spend functioning as a, as a marketing evangelists are flying around the world. Uh, speaking at conferences, meeting with clients, doing a lot of writing and research and stuff. And ultimately that's, you know, kind of the transition to what I'm, I'm doing in the electric vehicle space. Uh, about five years ago I started a blog where I was writing about all things green. Loren: [03:04] The use the, the name Loren Green. If, uh, you, uh, older people on this, they'll get the, uh, the connection there with Lauren Green, the old a actor from the high chaparral. But, uh, what I was doing was writing about a bit of everything and sort of the green space, everything from how to reduce, uh, you know, packaging and, uh, increase recycling and reduce use of water. This was back in the days of, uh, the drought in California, solar power and electric vehicles. And what I quickly found was as I couldn't sort of be an expert on all of those topics and I decided, uh, to sort of pick electric vehicles and that was the one that I was sort of most intrigued by about how are we going to sort of solve this problem, right? Well, what is going to drive people to actually want to, uh, uh, you know, transition to electric vehicles. Loren: [03:58] So that sort of when I started about three years ago, uh, the Evie adoption site and as you mentioned also sort of riding for clean, technical, etc. And so really have, you know, taken my career as sort of a marketer and consultant and strategist and somebody focused on research and data and have tried to focus, uh, on that aspect of them solving the problem, using data of when, you know, when are consumers going to, uh, you know, adopt, uh, electric vehicles, uh, in a, in a really significant way. Well, and is this your first full time gig now or are kind of still a hobby? Wish it was Scott. I'm working towards that. Um, but, uh, it, it is something I do is sort of, uh, on the side, if you will. So a lot of, a lot, a lot of weekends, uh, uh, and, and, and evenings and things like that. Loren: [04:55] But, uh, you know, instead of, uh, instead of being out working in the yard or, or riding a bicycle or spending time with my wife on weekends, I'm uh, you know, chained to my laptop, writing articles and doing great research. But I have to ask, uh, do you drive an Evie? I do. At the moment we actually have two Tesla model essence. Uh, so, uh, got our first one, two and a half years ago and actually just picked up or actually it was delivered to our house. Uh, the second one last, last Sunday. And I've gone from the low end model s which had, uh, about, uh, 200 and a little under 210 miles of range to one that now is 335 miles of range. And so I'm really excited to, uh, put that to the test on road trips when we take our daughter back to us college in southern California later this summer. So a show, we'll, we'll, we'll dive into these and road trips a little bit later in this conversation. Yeah. Cool. Yeah, I'm a, Scot: [05:58] I had a model s or a pretty early on in 2012 and then a side graded to a model three, so, so also live in that as la UV lifestyle with you. Loren: [06:07] Nice, Nice. Scot: [06:09] Cool. We're here on the podcast. We have a framework for the Vehicle 2.0 framework where we talk about the four big changes coming to the auto industry. We talk about connected car changing ownership models, uh, autonomy, and then of course, uh, evs. So we want to spend the bulk of our time with you talking about evs. I thought it'd be good to kind of, you know, talk about kind of from a timeframe perspective, uh, where you see things today in the u s and then we can kind of expand from there. Loren: [06:36] Yeah. So we're, we're really quite, quite early for any, uh, sort of, uh, techie geeks. I, I refer to this, we're probably in the palm trio phase. I don't know. Scott, did you ever own a palm trio? Uh, I did. Yes, you did. Yes. And you'd know what I'm talking about, right? We're, we're in that phase of, of where primarily sort of early adopters and I, and I use technology and, and I'm a big fan of, of um, uh, the sort of that w what's commonly known as the technology adoption curve. This idea of how consumers, basically, with any sort of new technology product, they start off kind of the innovators, uh, you know, really, uh, only, uh, for geeks people that are willing, uh, and can afford to sort of pay more for products they want to, uh, own or drive, whatever the latest and greatest thing is. Loren: [07:29] And then it Kinda goes up ultimately into, um, what's called sort of the, you know, early majority, late majority then, then, then laggards. And in, in most markets in the u s and around the world, we're still in that sort of innovator phase of, you know, kind of under two and a half percent. Um, it obviously varies dramatically by market, but in, in the u s today across the u s worried about 2%, meaning, uh, two out of every 100 a new vehicles that are purchased across the US today are electric vehicles. And when I say electric, um, I'm including in that both what we call PHEV plug in hybrids. Those are things like the, the Chevrolet volts and the um, the Ford fusion energy where it has a small battery pack and you can uh, uh, drive on a what's typically anywhere from sort of 20 to have a little under 50 miles range on electric. Loren: [08:30] And then gas engine kicks, kicks in, but you can then recharge that battery, um, by, by plugging it in at home or the workplace or whatever. And then a, what we refer to as be evs, battery electric vehicles. And those are things as you and I talked about, the Tesla model s uh, and three, the Chevrolet Bolt, uh, many, many other factors that, uh, only have electric motors and battery packs is so fully electric. And, um, so again, where we are today in the u s is, uh, is about 2%, but then when you break the country down, it is sort of, we have a fascinating picture, Scott, in that it varies sort of dramatically by sort of state and market. So California finished 2018 at just under 8%, meaning, uh, you know, that almost, and we should hit and we actually hit the 10% in the last few months of, of 2010, we'll probably finish 2019 little under 10%. Loren: [09:31] But in essence, in California, across the entire state, one out of 10 of every new vehicles purchased, uh, is an electric car. And, uh, and most of them, in fact, about 40% of them are, are the Tesla model three these days. But then if you go to a state such as, you know, Oklahoma or Louisiana or whatever it is, it's like 0.2, 2%. And so literally what we have is we have this sort of huge dichotomy and chasm in the United States where you have California, where people are literally buying evs at a rate of 40 to 50 times that of people in, in sort of southern states. And so it's, it's sort of really fascinating. And then if you break that down even further in a, in a city like Palo Alto, which is obviously a sort of a wealthy higher income, high tech community, we're approaching 50%, literally one out of every two cars being purchased there are, are electric. Um, and now where I live in, in the bay area, in the suburbs, we're at about 15%, 20%. And so, you know, that's a long answer to your question Scott, but, but fundamentally, no, across the u s we are still really, really early. But if you look at sort of individual markets, we are sort of well down in the path of adoption. Scot: [10:53] Yeah. Very cool. Um, and then I've seen, I think I've seen Tesla or I can't remember who talked about it, but there's a certain definition of a car where, where they're one of the top sellers where, you know, I think they put the model three into a, uh, you know, a price range, and then it's like a four door, and then in that category of they're outselling the BMWs and Mercedes, the Honda's and the, you know, so another interesting slice where you're starting to see, you know, the, a fair amount of adoption within a pretty narrow definition. Loren: [11:22] Yeah. If you look at sort of the, that sort of luxury sedan market, if you will. So the, the, uh, as you mentioned, sort of, you know, the, the, the BMW three series, Audi a fours, uh, the Mercedes c class, uh, the, the, uh, Lexis, yes. I believes in that market and stuff. The Tesla model three is actually crushing it, right. In sort of that, uh, sort of, you know, 30 to 40, you know, 30 to thousand dollars, depending on what configuration you get of those different vehicles. The, you know, the model three is, uh, uh, is, is, you know, outselling all of those cars by a pretty significant way. And so what's, what's interesting about that, Scott, is that, well, we're seeing the most of the u s and Japanese automakers still sort of laggards on, on launching new models. The German car makers get this right because they're the ones that are actually seeing sort of direct competition from Tesla. I actually start to eat it into either end of the market share and I know we're going to sort of dive into that a little bit more, uh, in a bit. But that's sort of a, a fascinating sort of side effect of, of Tesla success. Scot: [12:33] Cool. And then, um, I know you've done a lot of really interesting research kind of putting on your, your consumer marketing hat about, you know, what I guess what's, what's driving adoption in, in areas like California and Palo Alto, and then, you know, what's slowing down adoption, what are, what are some of the consumer insights you've drawn from that? Loren: [12:53] Yeah. So, you know, fundamentally, again, what I came up with this framework, uh, about three years ago that I called Karma c a r m a the sort of as a way to kind of think about, um, what are the different factors that that will ultimately drive mass adoption of electric vehicles and, and you know, sort of the, the letter Stanford charging range and speed, affordability, range model availability and awareness and understanding and well, fundamentally that's why the Tesla is sort of, is, is doing so well and that it's, it's pretty much solved most all of these problems, right? So first and foremost, as we all know, consumers that, that are thinking about, uh, potentially. And in Evie you're considering it or just learning about it, there's sort of first, you know, common concern is his range and what we call range anxiety, right? Mo, most cars available in the u s today, especially with sort of the, you know, SUV as larger SUV have north of 400 miles of, of a range and the gas car right and sort of varies anywhere from about three 50 to almost sort of 500. Loren: [14:08] And so consumers have been trained that their car should go, you know, roughly three 50 to 400 miles on a, on a tank of gas. And so their expectation is, is that an electric car should sort of match that. Right. And so know that's where sort of, you know, again, Tesla has done really well in sort of reaching that sort of higher income market that has been able to afford their luxury cars with over 300 miles of range or in some cases a little bit under that. But, uh, and they're going to come out, uh, the, the rumor is by the end of this year with a model s that we'll actually have 400 miles of range. So they're sort of getting to that point of you, at least from a range perspective, consumers who can afford the electric cars will, will not be able to sort of use sort of the, the lack of range of an issue, but fundamentally w you know, range is sort of sort of that, that sort of first starting point. Loren: [15:06] In other words, if you're, if you're going into a car dealer and considering a car, that is sort of the sort of the first step that, that people have to get over. The second one, uh, is, is, uh, I think, um, you know, just sort of affordability, right? And again, the, the challenge today with, uh, sort of both sort of supply and demand of electric vehicles is, is because of the, the cost of the battery packs is still pretty significant and it tends to be about a 20 to 30% of the cost of the vehicle. And so the, the battery pack prices are coming down significantly, but there's still, you know, too high as a, as a percentage of the vehicle. And so when you're looking at comparable vehicles, so if you're looking at a particular car model that has both the gas, uh, uh, you know, motor and an electric motor, and there…
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