In this exciting HEP-isode, Mike and Jo are joined by Chris and Rob from Moog Construction, whose innovative new ZQuip modular batteries could revolutionize the future of job sites. We also talk safety, work fitness, automation, and why South Park's anti-immigrant rally cry doesn't make a whole lot of sense. All this, and the power of Duracell batteries in our FIRST-EVER twentieth HEP-isode!
In this exciting HEP-isode, Mike and Jo are joined by Chris and Rob from Moog Construction, whose innovative new ZQuip modular batteries could revolutionize the future of job sites. We also talk safety, work fitness, automation, and why South Park's anti-immigrant rally cry doesn't make a whole lot of sense. All this, and the power of Duracell batteries in our FIRST-EVER twentieth HEP-isode!
Whether we're exploring the latest in trucking technology, talking about the trends that propel the industry forward, or uncovering stories about the dedicated individuals who keep the wheels of America turning, this is where the roar of the engines and pulse of progress come together. It's sublime, it's surreal. That's the Heavy Equipment Podcast with Mike and Joe.
Speaker 3:Welcome back to our first ever 20th episode of the Heavy Equipment Podcast. I'm your host, joe Boris, here, as ever with Mike Schweitzer, and today's a good show because not only is it our 20th episode, which is always neat, but we've got some guests today. A couple of weeks ago we ran an article on Electricco talking about Mogu Electronics' new Z-Quip system.
Speaker 3:Z-quip was a modular battery system where each module had its own thermal cooling, had its own electronic controllers, had its own battery pack, and the idea, in the most oversimplified sense, is kind of the same way it works with your Ryobi or Milwaukee tools, where you can pull out the battery, put in a fresh one when you need it and you can kind of manage the battery use based on what you need to accomplish on the job site. So you don't necessarily need an 18-volt battery pack for your flashlight. You can put in a six-volt or a number, whatever it is, and I think that that is about as simplified as I can get it. I'm here today with Rob Bauer and Chris LaFleur. Chris is the managing director of Z-Quip and Rob, you're one of the engineers that's developing the system. Thanks for being on the show, thanks for having us, thank you.
Speaker 3:Yeah, of course, now you know, I think for me it's very easy to kind of see this and visualize this as a powered hand tool thing. Right, that's what it said to me. But you guys, you know Moog works with a number of OEMs, your suppliers to Bobcat Case, a couple of others. You know, you guys are really, really smart. What was your inspiration for something like this?
Speaker 5:Right, it was all focused on how can we make electrification in construction something that people actually want to use, something that really makes sense. Like you said, moog has spent a lot of years working with the existing OEMs and in construction on, I mean, everything from electrified to autonomous tele-operation. It's a lot of really smart stuff, but we wanted to take our own approach and say you know, we see where certain things are going and we think we can make electrification go faster and be better for the construction industry. So what would we do in order to make that happen? And, like you said, rob, rob is one of many super smart engineers that we have. The stuff that they can do is amazing, and so when you throw a lot of really talented people at a problem and ask them to take a fresh look at it, you get some pretty cool stuff.
Speaker 3:Well, I think that's a really good way of putting it, because these guys are literally rocket scientists. Some of these guys are literally rocket scientists.
Speaker 5:So like that I was going to downplay how good he is, but my God, he is the man.
Speaker 3:That's awesome, but we talk about electrification in the construction space. You know it is happening, but it's not happening very quickly. And as we look at what the legacy brands are doing, some of the other OEMs are doing, they have a lot of things going for them and that they know how to build stuff, they know what their job sites need, they know what their customers like, but they also have a lot holding them back. They have existing platforms, they have sunk costs, they have diesel engine plants and a lot of R&D put in there. How are you looking at this differently, and how does being a supplier enable you to be more nimble than an OEM?
Speaker 5:It's important to know that we see this as being the kind of thing that everybody is better off when people push the envelope with this, and what we've learned with working with the OEMs is the good and bad that comes with having an existing stakeholder and existing products and, like you said, they're pushing this.
Speaker 5:But we see ourselves as being able to take risks and take leaps of faith that they might not be willing to take or might not want to take. For example, it's when you come out with a competitor through your own diesel product line. That's tough right, and it doesn't mean that they don't want to do that or it's not the right decision, but we don't have a lot of the constraints that they do. So we can take chances and we can come out with innovations and product features that we think really are great for the industry and other people will really love in the future. But we have the freedom and the ability to do it, and so we see it as just an opportunity for us to move the industry along faster in the electrification game because of that.
Speaker 3:Yeah, and you mentioned giving your engineers, guys like Rob, kind of carte blanche to look at things in a different way. And the thing that really struck me from our conversations outside of this and also from reading the materials and reading up on Zquip and what Zquip was all about, is this idea of looking at a job site not necessarily in terms of the work that needs to be done, but the energy that it's going to take to do that work and then the most efficient way to put that energy to use. Rob, can you speak to that a little bit?
Speaker 4:Here, ken, a few minutes ago you were mentioning using the power tool analogy, the hand power tool analogy, and that's a solid analogy, except for and you brought up a couple of different brands of power tools you might have the batteries. Don't go from one tool to the next. So once you commit to a brand, you know that you're stuck with that one. If you have multiple brands of power tools, you have to have multiple brands of batteries and chargers and manage all that.
Speaker 3:Why would you have anything but Ryobi hand tools?
Speaker 4:Let me think. Anyhow, when you're dealing with small batteries, small chargers, it's inconvenient but it's not that big a deal. They're not that expensive, it's not driving your cost, it's just an inconvenience. When you get up to a vehicle level and you're talking about the energy required for a job site, a battery that's sitting on the side uncharged, everyone always talks about how it's terrible if your battery doesn't have any energy left in it, how terrible that is. Our vision on that is that's actually good. That means you use that tool. The bad part is if you can't get more energy back out of that machine. Having a dead battery is a good thing. Not being able to get energy back in the machine is a bad thing.
Speaker 4:So in our system we have batteries that can go from machine to machine, across brands, across types of machine, across sizes of machine. That means that you should have only the amount of energy that you need to run that site. Machines that are sitting around unused are waste. That's what you think of them. That's not insurance. That doesn't make you feel good. It's waste, Right.
Speaker 4:Furthermore, the machines that we're building have multiple bays that take batteries, Some power tools. Now, if you see a Moitre software instance, it might take 260 volt batteries or something like that. Our machines can take as little as one battery, or as much as six for current machines we've been looking at. The machine will run just fine on one, two, three, four, whatever you need to make it go. It won't run as long, of course.
Speaker 4:But having all of this flexibility, Again, imagine that you have your hand power tools and one battery goes across all the different brands. There is no OEM that's incentivized to want to be able to swap with some other OEM's equipment. We are. We understand that our customers are. Because the energy back to your original question because the energy on the site is the limiting factor we've made it that you have just enough and you can move it from machine to machine. You can move it in three ways you can swap batteries, you can fast charge onto or you can do sharing energy from machine to machine. One machine can pull up next to another and just transfer that energy over.
Speaker 3:Let's talk about that for a second, because when we talk about pulling a battery out of a hand tool, talking about pulling it out of power drill, putting it into a microsoft, whatever it may be, it's very easy to do that. These batteries, I believe they're 140 kilowatt battery packs. They've also got cooling, they've also got controllers. They got away and I'm exaggerating, but I don't think I'm exaggerating by much. They got away a thousand pounds. How are you swapping these out? It's one thing to say we're just going to grab the battery and swap it out. How does that actually happen?
Speaker 4:The first thing to plant in your mind is the swap. Out is not the first thing that you want to do. You're going to be able to swap. We can swap. I'm going to answer your question in a second. The first thing you want to do is just keep enough energy on that machine. That could be fast charging and that could be buddy stores, just transferring power over and you're not dealing with those heavy batteries at all. Then if you have to swap, then you swap.
Speaker 4:If you have to swap, there's multiple ways to do it. If you're on a site that has a tower crane, that's by far the easiest way. You simply lift it off, you pull the battery pack back to the base of the tower crane, which is generally electric and has good power right there available. You throw that one on, charge. You pick another one up that's already charged. You go out to the machine, drop it on. It is literally our motto is one minute, one hand, one person to swap. The thing People are imagining this is a big, complex thing. That is our goal. Now I'm not saying we're quite all the way to that goal, but we're getting real close. In addition, that one person doesn't need any special training. They can be the operator. Just a few minutes of training. It's not much more complicated than the hand tool that you're talking about. All the interface to the machine has been made quite simple.
Speaker 3:Let's talk about that, because you've got this running on a CAT 308, eight ton excavator right now as a proof of concept. You're building out other machines, whether they're wheel loaders or compact forklifts or whatever else you're building. You've got a couple of these already happening. You can check the performance on that. But there are other systems on the machines as well. There's hydraulic systems, there's control systems, and those are not going to be uniform from OEM to OEM. How do all of these systems play nice together? Are there any advantages to having this uniform battery that works across all of these systems?
Speaker 4:The battery goes from system to system to system or across brands, across machine types. That is, literally there's two types of batteries there's a 70 kilowatt hour battery and there's 140 kilowatt hour battery. There aren't 12, there's only two For the other systems that you're talking about. In our conversion phase that we're in currently, we have to deal with the fact that Caterpillar has this kind of pump and Hitachi has something else. We have the motors, we have the adapters, we have all the pieces necessary to make all that work the motor pump combos, for instance. There's a little bit of engineering involved in that. Each time we do a conversion. The first machine that we engineer to do a conversion takes us a little bit of time. There's some engineering associated with that. After that, we have all the drawings, we have all the part list, we have all the stuff. We have effectively a kit. The second machine is easy. The engineering takes us a few months, but the second machine would only take us a couple of weeks.
Speaker 3:That makes a ton of sense. I imagine it's easier to actually service and work on some of these because you're removing all of the diesel, all the cooling lines, all of the fuel tank. You can just pop the batteries off and now you've got a big flat platform that you can access all the hydraulics from the access is incredible.
Speaker 4:Most larger excavators or mid-sized to large excavators. The valve blocks right near the center of the machine and the swing motors are right there. Once the battery packs are off, you have complete, unbelievable access to it. There's such a luxury to work on the machines in that way. We didn't start off the journey there, but boy was that a nice thing to find.
Speaker 3:Seems like Chris wants to say something.
Speaker 5:Oh, no, no, this is a better path to go down.
Speaker 3:Fair enough. We're talking about some of the advantages that you're getting from this conversion. Obviously, I work with electric. I'm all about electrification. In addition to the benefits that come with electrification the ability to work on noise regulated sites, the ability to work in environmentally sensitive locations that are no drip sites, the ability to do some stuff indoors and minimize the need for respirators and things like that In addition to those benefits, there's also a cost benefit potentially to converting existing fleet assets rather than effectively scrapping them all and buying brand new electric. Can you talk a little bit about some of that, Chris?
Speaker 5:Sure, Understanding the value of this is tricky. It really is a triggering point for a lot of people of what it's expensive, but it could be worth it, and we don't know what the future holds. The way we see it, though, is, like you said, there's so many benefits to this that, rather than focusing on what are the costs, what is this going to mean? What are the bad things that come along with electrification? What does this enable in the future? When you think about the value of a conversion versus purchasing new, there's going to be an impact of electrification on the residual value of a diesel. We're already learning that in Europe.
Speaker 5:Customers are saying I don't know how I feel about buying a diesel machine, because there's a chance it's worth nothing in five years. When you put that into a TCO model, it's tough. We want people to understand that it's the. Electrification isn't for everybody right now, but there is absolutely the use case where you convert a fleet of machines to electric, and it makes economic sense and it makes operational sense, and it really is better for your operators and for your customers. I mean the first time you see these things working quietly out back somewhere and you see how happy an operator is and you see how nice it is for customers to be able to be there, People just operating near it it makes a huge difference.
Speaker 3:Yeah Well, we talk about this all the time on the show, that just the ability to be able to yell stop and have the operator hear you, it's like a huge safety feature. Right, because how many times has the operator, the guy's digging a trench and he rips up a cable line or a gas line that somebody else saw but the frantic waving of the hands? The operator just gives you the thumbs up, waves back and keeps digging.
Speaker 5:I mean even we've seen it with the you get a 30 ton trenching, you got the guy in the pit with the total fiction and they have to stop stick their head out. Yell, stop stick their head out yell.
Speaker 5:It's just the ease of communication and the safety aspect of it is amazing. That's the thing is everybody who we've had used these machines prefers these machines. It's a great experience. It's where you get into your customer versus your user, the user of the machine. This is a great machine. It's powerful, it's quiet, it's clean Everything you wish the diesel was. It's making it make sense from an operational and financial perspective and that's what our goal is. Our goal is to make this make sense. When you talk about where we can be in here that the OEMs can't look, I don't think that the future of this will be. Every OEM is swapping batteries just openly and having a great time of everybody sharing it. I don't think it needs to be that, but I think it needs to be that now to change.
Speaker 3:I'm going to disagree with you.
Speaker 3:I'm going to disagree with you.
Speaker 3:I think it needs to be that, because if I've got an 80-ton machine or a 30-ton machine and it's got a 200 kilowatt hour battery pack and something happens to that machine and that thing breaks down and I have to get it serviced and we all know what a nightmare service has been, parts availability has been, chip shortage has been.
Speaker 3:Now I've got a huge, expensive asset sitting on a job site that I can't move and I've got a bajillion kilowatts of energy sitting in that battery that I can't access. If I had the ability to say, okay, there's a problem with this controller, there's a problem with this thermal unit, there's a problem with this battery, and I could just take that pack off, put a known good pack back on and send out that little pack for service or maintenance. That is infinitely easier than bringing an entire job site to a halt because my one electric excavator stopped working and now I got to figure out a way to get it out of the trench and ship it back to the dealer, and Lord knows how I'm going to make that happen. So I disagree with you. I think we do need to get to this point.
Speaker 5:Yeah. So that's the caveat right. Should we be there? Absolutely yeah. Will everybody play nice in the sandbox? I don't know, but you had an episode previously about the right to repair. I think that the biggest part with this is I just want to interrupt here for one second, nobody should be listening to these episodes.
Speaker 4:If you're listening to this podcast and getting real information out of it.
Speaker 3:That's amazing.
Speaker 5:So yeah, we did talk about right to repair. That's true, yeah, we did, yeah, but I think that the way we approach it right is what do we think a job site needs to look like for electrification to make sense? And if you think about just the overall right to repair discussion, that's happening now. You get a diesel mechanic on site and it's still difficult to keep your uptime going.
Speaker 3:But yeah, it can't work on these machines.
Speaker 5:These are not machines that anybody will know how to fix. And then, even if you do, they're computers, they're supercomputers, these are just unbelievable machines. You're not going to fix them on site. And so when we talk about the serviceability of this, the goal is uptime, always right. In order for these things to make financial sense, they have to work all the time.
Speaker 5:Everybody talks about battery life. Battery life is one part of that. Serviceability is the other side of it, and that's why this idea of modularity and what ZQIP really represents is not just about modularity to swap batteries. It's modularity to make sure that your machine has the greatest uptime of any electric machine out there. Battery dies you can swap it. Great. A battery breaks, things happen right Swap it. Electric motor breaks Modular Swap it. Charging Swap it.
Speaker 5:There's so many things that can go wrong, and I think it's about having the humility and the self awareness to know that this is the first generation of something that is going to be the future. To say that nothing will go wrong is naive, and so, rather than avoiding that or trying to be too big for that, we embrace it, and Rob's background is doing this for NASA and the US government and making sure that things are up all the time, because a plane can't be down or soldiers die. So we know how to do this, rob knows how to do this and this is what the background of this government and space and military application. If we can do it for them, we can do it for your construction site.
Speaker 3:Yeah, for sure, for sure. Well, this is just great stuff, and I think that for me, the only real question left is is this real? And I don't mean to put that out there in a negative way, but there's so much vaporware in this space, there's so many people where you don't even know if what they're showing you exists. You know, cummins at the ACT show, brought out their new 15 liter that you could swap the head and run it on biodiesel. You could run it on a hydrogen blend or pure hydrogen. All you had to do is swap out the top end and connect the fuel sensor to determine what kind of fuel was in there and you were good to go. But here we are almost a year later and nobody's seen one running yet. So is this real? Is this something that you look at it and you go yeah, this is real, we've got it in operation, it's going to cost this much. Or are we still in the fingers crossed Hail Mary stage?
Speaker 5:No, this is real, absolutely.
Speaker 4:Our 308 has been running now for a full year and we take it out all the time. We're beating the tar out of it. We've had many operators come in from government agencies, from private contractors and run it. Sometimes they show up pretty much diesel fans, but they cannot help themselves. They're kind of giggling by the time they leave and it's just too much fun to run it. It's quiet, it's fantastic. In addition to that, the other parts of the system are real in our shop right now. It's totally functional and being turned into commercialized buttoned up products ready to go out to the field. We're months away from having multiple machines on a site working together, sharing energy, swapping batteries, doing all the things we've talked about. We have all the prototype work going already. In my entire time at Mogue, this is the lowest technical risk project I've been on. There is no technical risk left.
Speaker 3:I wish I could see behind the NDA curtain and see what other cool stuff you've been working on.
Speaker 2:Because that sounds pretty impressive.
Speaker 3:There's been some fun things along the way. The high-tech thing that you guys can barely conceive of. This is the dumbest thing I've done.
Speaker 4:I didn't mean that. It's just that we know how to do this. We have clear line of sight and, where we are to working in the field, clear line of sight on the whole thing.
Speaker 3:That's awesome. One last question we're talking about construction sites. Job sites are critically important. This is one of the areas that we need to electrify. I think there's also applications for this in the field of agriculture, especially on hobby farms, where you may be able to set up something where you've got animals, you've got horses, you've got vineyards, where the smell of diesel and the chemicals of diesel get on, the particulate matter gets on the product. That's something that you don't want. If you're a high-end organic farmer, then the other question I would have is is there any on-road application that you guys are looking at, because we've been talking about off-road the entire time.
Speaker 5:You're going to get us down to rabbit hole here, man. We can talk about this for days.
Speaker 3:We got seven minutes left. We got days is a lot but seven minutes, and it's Miller time.
Speaker 5:We've got a big vision for this. The smaller you have an idea and a vision for what electrification it is, the less it makes sense. So the bigger you get, it always just works better. Then if you think of well in construction, the site is part of it, but there's an entire on-road, there's a separate off-the-site aspect of this. You start to think of how all of that combines into this operation of things getting done to get a job completed.
Speaker 5:You think on-road it's RZ-quip modules can fit in the back of a Ford Lightning. You could have your pickup truck with a battery in the back, charging that plugged into your machines in back, taking it to different sites. You can have power moving across sites. There's not just energy on the machine, but there's gensets that are going to be converted to battery rather than diesel. There's other mobile power applications.
Speaker 5:Rob and I have talked a lot about this, of solar farms. Rather than connecting solar farms to a grid, having this last mile delivery of power back and forth, it's really about the right way to get energy from the source to where it has to be worked on. We see the Z-quip application as having much broader reach than just being a battery on a machine. It's a way for the entire site, the entire operation, to get the energy needed to do the work that has to be done. This is what makes this just an extremely rewarding and challenging thing, because you keep getting bigger, and the bigger it gets, the more you start to get that feeling of we could be really onto something here. This could really change things.
Speaker 4:I'm impressed, I love it. Once it's modular and either swappable or fast-chargeable, a lot of things change. Imagine the American Southwest a giant desert. It is hard to take a large heavy vehicle, electric vehicle across that desert. From a range point of view that's difficult to do.
Speaker 3:That's also one of the things I used to have a Fiat who could barely get across there.
Speaker 4:Yes, it's also one of the best places in the world to put a solar farm. Yes, there's huge tracks of inexpensive, undeveloped land that nobody's going to care. If you build a solar farm, it's not a nimby problem, nobody cares. Every 100 miles you have a place where you have a giant solar farm. The energy is not even hooked to the grid. You don't even have to have the grid out there, it goes into the Z-quips. You pull them with your tractor trailer. You don't own that Z-quip, you're renting it. It's just a thing.
Speaker 2:It's a subscription.
Speaker 4:You stop going off you stop another one on, you grab a cup of coffee and you're on your way. Yeah Right, we do all kinds of robotics here, so building the automated swapper. You're asking earlier today about swapping modules A year and a half from now. You're not going to even have to touch it. You're going to pull up next to a machine. It's going to pull it out, put the other one in and you're on your way. You don't touch it, you don't worry about it. You answer a couple of texts why it's happening.
Speaker 3:That's cool. This is great stuff, guys Listen. Thank you so much for being on the show. I know we're coming to the end of our time commitment. Here you have the floors. Is there anything that, if I was a professional, I would have asked you? That would have really set the message across. Or is there something you just want to sing? A little mogul electronics jingle for us? The floor is yours, yeah.
Speaker 5:Still working on the jingle, but thank you for the time. I hope you can see how much we love this and we believe in this and we are looking for people who are interested in this, and so for those who have a fleet they have the site. They need this to happen. Reach out, talk to us and let's get this going for you.
Speaker 3:Sounds great and I just want to address real quick. Bill said something about the center of gravity. Rob's a smart guy, I'm sure he's figured that out. I don't think we need to validate the concerns there, like if you're on a 45 degree angle and you're trying to run an 80 ton excavator, you've got bigger problems.
Speaker 4:Yeah, we're paying a lot of attention to all this. We're keeping our CG low. We're there, we build airplanes for living. Cg is kind of a big deal in that world.
Speaker 3:So we're good. Yeah, Rob's got it under control. Guys, Do, do, do, do, do. All right. So that was Chris LaFleur, Robert Bauer from Zquip and Mike. What do you think of this thing, man? I know we talked about it a few weeks ago, but this is something that I think is really cool. Nope, have we lost my load there? We?
Speaker 2:are Good. Sorry about that. I went through a tunnel. I came out the other side.
Speaker 3:Mike's driving through the tunnel today.
Speaker 2:Yeah, actually it's been an entire week of being on the road. We had a safety meeting at every offer and we go through that every year multiple times throughout the year. Well, this is our big safety summit throughout the entire company.
Speaker 3:So here's the thing.
Speaker 2:Well, that's a lot of driving it is. I was in Chicago on Monday, cleveland on Wednesday and then I was at Pittsburgh today and I'm heading out to the airport in Cleveland. You fly out. I'll be in Daytona tomorrow.
Speaker 3:Oh, that's right, You're going to the Daytona 500.
Speaker 2:That is correct. There's a profound statement that is on our safety meeting and I can speak about that and it says we will perform to the standard of which management will tolerate. Ok, explain that a little bit.
Speaker 2:Well, what that means is that, as managers, as supervision and as personnel, if you have no responsibility other than to anybody but yourself, even if you have no pet, nobody to go home to, you're just living on the road you're going to work to the standard of which you tolerate. So, if you want to work safe, you're going to make choices throughout the entire day and you're going to work for the standard of which you want to, and that goes to the people that work for you and that goes to the people you work for and to the people you work next to you. It's all about your own choice. So if you want to do it, we want you to do it right. We want everybody to be safe, everybody to go home, not get killed, not get hurt, not hurt those around them, and that's kind of a profound statement. That was our message for the week.
Speaker 3:I like that. That kind of goes along with that. Have you ever heard of the Peter principle? Yeah, good. So for those of you listening who have not heard of the Peter principle, peter's principle is sort of like Murphy's law. It says that everyone gets promoted to their level of incompetence.
Speaker 3:So if you think about that in terms of a restaurant, you get hired as a bus boy. You're a really good bus boy, people like you. They make you the host. You're a really good host. You're seating people. You're keeping people moving. So they make you a server. You're a really good server. You're making a whole bunch of money. You're making people happy.
Speaker 3:They make you a shift manager. You're a pretty good shift manager. Everybody kind of digs what you're doing. You're getting by, you're doing the job, you're there a little while. Then they make you a store manager, and you're not really a good store manager. You're kind of mediocre, maybe not even mediocre. You're just not very good. You're kind of incompetent, right, you're just barely scraping by without the whole place catching on fire.
Speaker 3:Well, most places will not demote you. They will not put you back in the position that you were, excelling. What they'll do is they'll just keep you there where you're terrible and you're just going to sit there and be terrible for the rest of your career. And now, as a company gets older and more mature, you start to have more of these Peter principle things take effect. So you have somebody who is a really good regional manager they get promoted in national. They're not that good, they stay there. You have someone who's not really that good on the regional side they stay there. And you start to see things like that when you look at like Ford and GM and these companies that are a hundred years old. You start to meet and interact with some of these guys and you just go. Some of them like wow, this guy is really sharp, and others like man, how did this guy get this job? He has no business doing this.
Speaker 2:Yeah, he got the job because he's been there forever.
Speaker 3:That's exactly right, and he's just been promoted to the point where he's just completely inept. And I've always been lucky. I always get to that point at the ground level, so I don't even have to worry about getting promoted.
Speaker 2:You know another big thing that we talked about with safety in various forms. It's fit for duty. Fit for duty is a big thing, you know operators showing up on the job. They run equipment but they're not fit to climb into it or not fit to do it.
Speaker 3:Yeah, that's a real problem.
Speaker 2:It's a real problem you got I was talking to somebody two weeks ago that works for another company it's not ours and we were talking about, you know, people that are fit for duty and he goes. It is a problem with everybody that I talked to, because everybody I talked to is talking about that. It's all showing up, not ready to work. It could be something as simple as you have tennis shoes on. What can I do with you? Do somebody that shows up who clearly has a pre-existing medical condition? Okay? Well then I need to talk to this guy. What could he do besides what I think he was brought in to do Not going to be swinging an ax all day, or he's not going to be swinging a pick all day. He can't do that, but maybe he's got some other hidden talent that we're not sure of. But it all takes time. The workforce is full of us right now.
Speaker 3:Well, I think it goes two ways. Right, the kind of lack of workforce that's out there, and there's a group called HBI. Right, this is the Home Builders Institute. They're talking about the lack of skilled labor in the construction industry, and they're just talking about residential construction. And they're saying that, in order to meet the demand that is there now, that we need to add 2,000, more than 2,000 new workers every day into the industry, 750,000 per year over the next three years, just to meet the current labor demand. And we're not going to get there. We're just not going to get there.
Speaker 2:You are not going to what happens and this goes back to my first statement about will perform to the level of which management tolerate If we tolerate less skilled workers or less capable workers that therefore are on fake Cuz. We're trying to be the quota that we can achieve anyway, but everybody around you, the equipment that they're operating or they're working next to, in jeopardy.
Speaker 3:Yeah Well, but this is where you start to see that push towards not only electric but autonomous. You know Like I'll give you a case in point arc best just put out. They've been doing electric you know forklifts for a lot of years now, and the reason that it's important that their electric is this next bit they now have a fully autonomous warehouse where one or two guys running the stuff on an iPad, using cameras and sensors, can run a fleet of 20 of these things, these material handlers, inside a warehouse and move stuff around and load up pallets and everything else. And you don't need 20 guys and two foreman and people who are alternates and then worry about people calling and sick. What you need is guys who know how this stuff works, who can sit behind a tablet and ensure that everything is running properly. And the reason Electric is such an important part of that is you can't run all of these sensors and all these Nvidia graphics cards and all of this AI Stuff.
Speaker 2:You can't run it off 12 volt current right this reminds me of the Self-park episode, where they're talking about stuff. The next thing, you know, somebody stands up and he's like they took our job.
Speaker 1:They took our jobs. They took our jobs.
Speaker 2:And then they keep going and it keeps going all the way to a rooster. No, because it just gets. So it's the idea behind the scene, was it's so ludicrous. It is just not enough people as it is. So the idea that autonomy and and all this is going to take somebody's job, it's craziness because there isn't. There isn't anybody to take the job as it is. But but yeah, there is no reason why anybody should be worried about people getting their jobs taken by anything that we're talking about, because there are not the people to take them from.
Speaker 3:Exactly. But how often do you hear that? You hear it from all walks of life, whether it's you know rich guys on Madison Avenue or you know these poor dirt farmers in West Virginia. Everybody is convinced that immigrants are coming for their job, robots are coming for their job, ai is coming for their job and it's like dude, nobody wants to do these jobs. I was talking today, you know, and we'll revisit these guys in another episode but I was talking today to a guy from case in New Holland, and Case, new Holland.
Speaker 3:They're huge in agriculture, big in construction, but huge in agriculture with the farm, all and everything else. And you know we keep talking about every year there's fewer and fewer people who want to get into farming and who want to get into Agriculture and get into that industry and the people that are there now, a lot of these farm principles that are in their 60s, that are in their 70s. They've worked their whole lives thinking that they were gonna leave the farm to their family or their kids or their grandkids Maybe, and their kids don't want any part of the farm. They don't want any part of that life. So, number one, they've got nobody to leave it to and number two, they've got nobody to work on the land and we still keep making more people.
Speaker 3:You know there's people talking about Population growth is slowing down. It may be slowing down but that doesn't mean that the population is not still growing Like it's gonna be decades before we start reducing the number of population, especially the United States, with all the immigrants coming in and we still need to feed all these people and if we don't have bodies to throw at the farms, we got to start throwing robots at them.
Speaker 2:Hey, you can't Keep going. You want to know what. The biggest thing that's taking people's jobs away is stupidity. There's a lot of that to go around there is, and the lack of common sense and the lack of Willingness to learn which you put them in them. You're gonna call it ignorant, but it's stupidity. That is what robbing people of jobs right now.
Speaker 3:Yeah, you've got people who don't understand. And it's something as simple as you know fit for work, right, you can't show up to a job on a construction site in tennis shoes. And then the other problem going around and this is, I think, a minor problem in terms of the number of times that it's affecting people, but I do think it's a major problem because we as a society have not yet come up with a way to To integrate this into our workforce. And I'm gonna get to what it is in a second the legalization of marijuana and other recreational drugs throughout the country.
Speaker 3:You've got guys that you know Enjoying the, the couple of gummies themselves, or they had an edible at a concert a month ago. Something goes wrong. They go in for a drug test and they have this perfectly legal substance in their system. And and now what do you do? Now you have an incident, now You've got some evidence of possible impairment. Now You've got liability issue. You've got to essentially let these people go or keep them off of your job sites Just because of the liability, even though they may not be affected at all from something that's totally legal.
Speaker 2:Yeah, and, and there are round table meetings going on, you know, monthly with different contractors and and safety directors in the industry. There is a number of tests now that have been developed.
Speaker 2:They've been field tested that can tell okay, I had somebody that drove a vehicle, drove a piece of equipment, operated a piece of equipment, had an incident Tested positive. They send it off to a different testing procedure and they can tell, based on their BMI and things like that, roughly how much and how long ago it was that they ingested, whether smoke that, ate it, drank it whatever it is and that that's becoming a larger player in the testing of substances and drug alcohol, because you're right, it's more complex.
Speaker 2:Today used to be. A guy had drugs in the system. It's not legal. He's gone exactly Now you have a whole level of testing that has to go on. Beyond that, there are a lot of people fighting for the legalization of marijuana. There's a lot of reasons why it probably is really good. There are a lot of reasons why that whole industry Is for it. The states are for it. People want to talk about taxes and tax revenue. They have a huge generator of that. Take some of the burden off of everything. The bottom line is people are going to buy it, they're going to get it, they're going to smoke it, eat it, do whatever they want to do. It all falls under that same umbrella fit for work. And are we going to tolerate it? Yeah, we're going to tolerate it. How do we tolerate it?
Speaker 3:Exactly, and I think that comes down again to this robotization and electrification of the workforce. And we don't even have to. You know I always like to make things about electric for a lot of reasons. I came into all this right, it was from the battery side and from the tech side of it, but even on the diesel stuff I mean cat. You know this wasn't something that we were planning to talk about, but Caterpillar has upgraded all of its you know cat grade and cat assist and AR, euro software, and they're putting all of that into their dozers, the D4, d5 and D6. They're making all that, what on a car would be called ADAS or the driver assistance systems. They're making all of that standard across their line. And they're doing that because there is the lack of skilled workers. But the people that are willing to show up a lot of them don't have the 20, 25 years of experience that guys from the previous generation had. So if they're going to be, you know grading a road or something you want to make sure that's, you know smooth, not a bunch of waves on it like you're looking out onto the ocean. So all of this software is making up for that lack of experience.
Speaker 3:And I think, as you start to see the cost of college and tuition and that life path, continue to get away from the middle class and you know the working families of America and that college dream that has been accessible for a couple of years and I think that's going to be a big step for a couple of decades but is now becoming less accessible. You look out 5, 10, 15 years. If you've got young kids now and you're thinking where am I going to get $300,000 per kid to send them to college, the answer is a lot of people aren't. They're just not going to be able to. You're going to have more people coming back into the trades. You're going to have young cats that are familiar with technology, that are not afraid to use technology. They're going to be coming into construction, agriculture and they are going to expect that the machine is going to do a lot of the stuff for them.
Speaker 2:We have to have that. We have to have the equipment aiding these people, whoever you are, because, like you said and we've talked about this before the guys that can feel it through the seat yeah, when it doesn't matter whether the machine's electric, it's hydraulic, it's purely mechanical the seasoned guys that drew up on stuff, they can feel it before it happens. They know when things are going to rock. You don't have that anymore with the younger group, with the newer people coming in. They've been sheltered from that for their entire existence.
Speaker 3:Hang on, I don't think that's fair, because there's guys that come up you know, we talked about this before Like if you were driving the old 74 Cadillac and that thing was like a boat and you couldn't feel the ground and you couldn't feel the wheel.
Speaker 3:And if you came up driving early BMWs in the 80s and early 90s that had no digital anything, everything was analog and felt connected to the road, that was a real revolution compared to that kind of floaty American sort of battleship type of handling that these cars had. When you look at the heavy equipment, you look at the trucks and drivers and everything else, it's almost the reverse of that where those really stiff machines that didn't have the isolation, that didn't have, you know, the comfortable air ride seats, that didn't have the cushy seat padding, that didn't have the noise canceling in them, the guys that have experienced they came into this through that. If you there is no amount of seat time, I think that you could get in a modern machine that would teach you how to feel that from the seat of your pants or from the feel of the wheel, because you're so isolated by power steering, power seats, power brakes, power and everything.
Speaker 2:That's what I mean.
Speaker 3:Yeah, exactly, yeah, yeah, it's not a fault of the guy, it's a fault of the equipment, the equipment doesn't let you feel.
Speaker 2:That's what I was getting to you. They've been isolated from this growing up, like we are talking about this in a small focus group that we were working on it, even from the early concept of the car. Young kids today do not know what it's like to ride in something like it was 30 years ago or 50 years ago. Okay, so you're a young kid, you're isolated from a young age. If you and then you progress through life, you then you get into a semi truck, which is isolating you again.
Speaker 2:You get into a new piece of equipment, just like you said, it's isolating you from the sounds of the noise and the dirt that 50 years ago guys were experiencing. 20 years ago guys were experiencing. We're removing a ton of people from those ambient environments and because of that we're desensitizing a ton of people to think Because the equipment has to help. You need that to help Because the days you know and like you were bringing it up about C&H, the kids that work on the farms, and then the sixth, seventh generation farmers they're dwindling faster than we could ever create them and we need the equipment to help.
Speaker 3:Yeah, and there's no reason why.
Speaker 2:That's what I was going to say. There's no reason why it can't, and there's no reason why we can't use the technology available to us to help replace people that are not capable of doing it any other way and put the people to work. There's a saying that the world needs ditch diggers too. That's very true, but we're running out of those. We're running out of a need, though, for them to, because a lot of manual labor anymore is being phased out by unsafe work practices. This is a whole other level. You have unsafe work practices that led the way for manual labor. Not going to stick a guy 30 feet down in a hole with six other guys and they're going to fill buckets to be hauled out with a crane. No, we're going to bring a machine in and we're going to dig that out with the machine. There's a lot of these things that are starting to finally fade. I also think we need to put the caddy shed clip in that part.
Speaker 1:I plan to go to law school after I graduated, but it looks like my folks won't have enough money to put me through college.
Speaker 2:Well, the world needs ditch diggers too.
Speaker 5:Nice try.
Speaker 2:Yep.
Speaker 3:We should play that earlier because, like we're talking about, like people aren't going to go to college like they have been in the last 2040 years. You know, I think it's really sad, because we talked about this a lot, right? Like, I think it's really sad that we have all these robots and all this AI out there. And what an awesome way to say, like, look, the world needs ditch diggers too, but it doesn't have to be you or me. It can be this robot and we can go do this awesome thing. Except, instead of that, now we go, uh-oh, need to get your jobs. You're going to go find some other way to put food on the table?
Speaker 2:Yes, Well, you know and a lot of things do come full circle, though Sure, as humanity, we do bring things around full circle. So there was an article that just came out not too long ago about how they want to equip ocean going vessels with sails to aid in helping them, propel them, become more efficient. We had it. We thought it was the worst thing ever. We get rid of it. We went to steam, we went to diesel power, Then we went to electric. If you're the government, you have nuke, because that'll go for you know however many half-life. So you know, we do bring things back around. Somebody's going to tell us that steam engines are cleaner and that it was better off having it that way, but instead of burning coal, we're going to have a reactor in it.
Speaker 3:Right, exactly right. You know, I see the point that you're making. Like I do think that there is a there's a cyclical way of looking at those.
Speaker 2:Glad somebody does.
Speaker 3:Glad somebody knows what you're talking about. Biff's over there in the passenger seat he's taking his head. It's like, oh God, what are we talking about here.
Speaker 2:Hey God, I'm not on the road doing seminars anymore.
Speaker 3:He doesn't even. He's not even keeping the script anymore. We're all over the place. We got episode one, episode two. We're all over. It's terrible, but Go back to the Edit it and just pull it back together.
Speaker 2:That's all you got to do. That's all I got to do. Throw the rest of it back into there and just cut and paste the whole shit back. It's going to be fine. We're going to love it.
Speaker 3:Hey, you know. So why didn't you get your comments on the on the mode thing? Cause we were you were riding through the channel, so talk to me about that. I still think that's a great idea with the Swapping the batteries on the equipment.
Speaker 2:So when I was watching, that and then, and then we were listening to the whole thing and Get that at that out, cause that was. I was rambling there for a second, somebody caught my attention, so all this is 40 minutes of rambling.
Speaker 3:You don't have to worry about it. I know how to edit it. You're going to tell me what it is. Yeah, oh, eddie, yeah.
Speaker 2:Here's the thing that I took away from that whole interview, and and what they have is a very cool product, the very good concept, and I can tell you as a fleet manager has somebody that helps dispatch equipment and breakdowns do matter when they happen. It eliminates a whole level of the machine that could let you down.
Speaker 3:Yeah.
Speaker 2:And if I was in caterpillar or C and H or Kamatsu, I would have gone into a meeting with a model excavator and a Milwaukee battery and said this is what I need. We're talking about electrification. Slide the battery into the back of the thing and let's go to work. And the other good thing about it, too, is Okay. So let's say I have a failure. I do look at the machine and I cannot be fixed right then and there Right, and I can't take that off of the core source. It's not wasted. Put it on to something that is viable and let's go back to work. It has nothing. I mean the battery, if you know. It's just one part of it that you have the machine part of it as well. If I lose an engine and an excavator on a job, I can't take that excavator and pull an engine out of another one and stick it in the one.
Speaker 4:That I think is better for the job than the one that blew up.
Speaker 2:I can't make that swap. It's the same thing with you know we, years and years ago they used to do that with equipment. When equipment was simpler, you had a twin engine scraper and you lost the rear engine. You could pull the engine out of another scraper, put it in the back of the other one and go back to work. Those days are long gone. This is as close to that simplicity as you're going to get, because once you plug the battery in and, like you said, if, even if the battery is the problem, you take it off and put one back on. If the machine's the problem, you move all your batteries and you put them into the other asset that you've brought and go back to work.
Speaker 3:Yeah, it's a great concept and you know we opened the show with those guys. We'll close with that and this was a little bit light on cultural references. Let's throw in some random vintage commercial for something, maybe a little chase in the sandborn we will see you next week.
Speaker 2:Duracell batteries we need vintage Duracell batteries. Yeah.
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Speaker 1:Or lasts like it. Tune in next week for more heavy equipment podcast on Spotify, apple Podcasts, google or wherever you find podcasts.