In this HEP-isode, we sit down with Marc Kermisch, CIO of CNH Industrial, to talk about how Case Construction is approaching automation and helping farmers become their own source of futuristic fuel. Case' project Zeus and New Holland's electric tractor concepts win design awards, the boys discuss a massive PACCAR recall, China's marketing challenges, and Jo makes a startling confession that could tear the show apart. All this and more, on The Heavy Equipment Podcast.
In this HEP-isode, we sit down with Marc Kermisch, CIO of CNH Industrial, to talk about how Case Construction is approaching automation and helping farmers become their own source of futuristic fuel. Case' project Zeus and New Holland's electric tractor concepts win design awards, the boys discuss a massive PACCAR recall, China's marketing challenges, and Jo makes a startling confession that could tear the show apart. All this and more, on The Heavy Equipment Podcast.
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 Serial. That's the Heavy Equipment Podcast with Mike and Joe.
Speaker 3:Welcome back to another episode of the Heavy Equipment Podcast, this one's number 21. And we've got special guests today. Before we get to that special guest, I got to tell you a story about what imaginative way that one young lady who used to host University of Miami College radio station, one way, she put her microphone to use one bright summer night that young Joe Boris was a part of, and later that night he became a man. How you doing, michael?
Speaker 2:I'm telling a story.
Speaker 3:I'm telling a story here. I don't listen. I don't know if she just pushed that thing into a tub of macaroni and cheese, but my little imagination ran wild with that, so I got some use out of it Listen.
Speaker 2:I have seen operators get worked up over heavy breathing over a microphone. I could only imagine.
Speaker 1:So tell me, what are you wearing? Right, exactly.
Speaker 3:Like a car heart jacket, some heavy workman's jeans and some tennis shoes which I shouldn't be wearing on a job site because they're not work ready, and of course I'm alluding to young Michael's national safety tour. You're coming back now from Pennsylvania, right? How's that going for you, that's?
Speaker 2:doing good. We're coming back from Pittsburgh on my way to the Cleveland airport and then taking off.
Speaker 3:So all that's right back to the tone of 500. You're going down there with the Union rental guys, right?
Speaker 2:Yeah, united is. They're going to be down there and then I'm going to meet up with those guys and there's actually a couple other people down there that I'm finding out, so it'll be busy. We're going to run into a bunch of people and then in Indianapolis on March 6th.
Speaker 3:Oh, that's work truck week.
Speaker 2:Yeah, I'm going to be out there for that in a cab meeting with one of our vendors, so that'll be fun too.
Speaker 3:I'll be out with Mike as well, so you'll get to meet some of the heavy equipment podcast guys, if that's something you want to do, and whether it is or isn't coming up next. We've got a guest on the show today. This is Mark Kermish and he is the CIO of CNH. Obviously, cnh stands for Case New Holland and that's correct. Now, obviously, you guys have been in the news quite a bit recently, not only with the electrification stuff, but also with the automation stuff, and what we've seen mostly in automation has been on the farming side of that and I think we've talked about that quite a bit on this show, whether it's vertical farming or autonomous farming. Can you talk about cases rolling that as well as New Holland and kind of how you guys are approaching that autonomous sector?
Speaker 4:Yeah, absolutely. First and foremost, autonomous starts with automation. So you need to really automate aspects of your machine. Then from there you start to work on how you take the operator out of the cab and create that autonomy capability. I'd say, when you think about it in context to construction, a lot of it's going to be around blade control or bucket control. So if you think about a dozer, the best thing I could say is when I first got into construction, I got into the dozer and I had waves going up and down the road.
Speaker 4:I couldn't control that blade at all. I was going up and then I was going down. I couldn't figure out how to create a smooth road to save my life.
Speaker 3:Yeah, well, but that's really interesting too, right, because you do have a construction background. I didn't even get into that, but the assumption is that anybody who's at the C-suite or at the C-level of these companies, they're all MBAs, they're all pencil pushers, they've been working on spreadsheets, they're not working in the dozers, they're not working in the excavators, and your background really does include a lot of real world experience.
Speaker 4:You're right, it does it's. You know, if somebody ever asks you what happens to English majors like I, am that guy, because I'm a philosophy major.
Speaker 2:I know what to do. What's the?
Speaker 3:joke. If you want to, if you want to get the philosophy major to leave your house, just pay for your pizza.
Speaker 4:I have to admit, philosophy was one of my favorite classes in college. Maybe that's why I became an English major. But you know, yeah, my background is pretty rich and diverse and I've worked in and out of AG and construction throughout and I've had the chance to operate our vehicles in different conditions and, as I was saying, you know, until I hit the GPS button and the blade control.
Speaker 5:Button.
Speaker 4:I was the worst bulldozer operator you could ever imagine and all of a sudden I became the best with a single click of a button and that's the magic of machine automation right, when all of a sudden you've got GPS points on both sides of your blade. It's got essentially a six access control capability and now I just become the safety mechanism of pushing the gas for the break as the dozer is doing all the work, Then being able to take that and build the safety components for autonomy, object detection, 360 degree awareness, alert management, off board capabilities. So the construction operator can have it in the phone right and they can pull their mobile app out and start and stop a mission. Super complex capabilities to add on top of automation. But that's ultimately where a lot of your construction and agricultural is starting to go, and part due to lack of skilled operators or folks that want to go into the trades or farming.
Speaker 3:Well, and that's really a good point, because, you know, I saw some statistic and this was now a couple of years ago and I don't know how accurate it was and they said that the average age of a farm principle in the US was 68 years old and it was progressively getting older. Now, if you've got a scenario where the average age is 68, there's a bunch of guys in there that are in their 40s and 50s. I'm sure there may be second or third generation farmers, but you've probably got some guys in there that are 75, 76 years old that are just hanging on because they don't really have anybody to leave it to.
Speaker 4:You're right, I think you know farming in particular is definitely going through a sea change and it's challenging. It's tough to get folks to live in rural America and it's tough to, you know, get somebody to take on a job. That's just hard work, right. And you have all the aspects of weather that you can't control, commodity prices you can't control, and you know the complexity of a farm operation these days. You know is tough and you know making a good living, you know requiring a lot of blood, sweat and tears and I think partially that's where you know the push towards automation and the push towards autonomy comes in to be relevant to the farmer.
Speaker 4:You know, and starting in the 80s, you started to have guidance right, which the best way to describe that is it's like the cruise control of the tractor right. And then you started to, you know, put in steering, you controls there and you have center-meter level accuracy and then you start to automate the tractor and the implement and now you've got a vehicle that you can have a unskilled operator in be able to do a very skilled job and a farmer or the principal of the farm has confidence in what's happening. And that automation gets complicated because you're running a 20 or 30-year-old planter behind your tractor. You're trying to do it as fast as possible in a very short planting season and if you have five or six or 10,000 acres, you may have 10 tractors running at one time, and finding you know 10 guys that have been planting their whole lives is not easy. And that's really where automation comes in.
Speaker 4:And then unfortunately, like you called out, even finding that labor to come in and just drive the automated vehicles getting tough. And that's how economy starts to enter into the picture, where now maybe you know, you can have five or six vehicles running with just one operator controlling it from the kitchen table on the farm. But, to your point, farms are not only. You know the average age of the principal I think I've heard between 57 and 68, like you said, the average size of the farm has grown to just under 500 acres, which really is just a reflection of consolidation and it's not a common debt farming operations that are upwards of 100,000 acres in the US and hundreds of thousands of acres in places like Brazil or Australia.
Speaker 3:Well, and when you do run into that, you know, is that a greater challenge for autonomy or does it almost make it easier, because you have more room to kind of operate in, and if your margin of error is five or six percent, it don't really matter. You got another 50,000 acres to make that up in.
Speaker 4:A farmer will never give me a margin of error. Let's be clear. All right, they want 100% of that yield all the time.
Speaker 3:Well, but now hang on, let's talk about them for a second, because you know you're seeing this with autonomous cars and we're seeing this with you know, like crews and Waymo and all that stuff, where you know they may have, however many you know, tens of thousands of miles of error, free driving and then they have an error and somebody you know unfortunately gets hurt or maybe there's an accident. You know we expect the automation, and I say we, we as humans expect other humans to make mistakes, right, but we demand that the automation is perfect. How do you guys deal with that? Because even though you're not dealing with cross traffic or flashing lights and signs and things like that it's a different problem than on-road automation there is still a significant challenge to automating across what is effectively wild land, with you know who knows what's under the surface and trying to navigate in and out of rows and you miss it by a foot. You've just destroyed a whole corn crop, right?
Speaker 4:Yeah, and I would say you know maybe a couple of things you know, depending on the farm operation that they're doing will depend on the amount of variance we get. So if you don't till it, you just turn dirt over, right. It doesn't matter if I have, you know, overlaps in my lines or anything like that, very different than planting right. You need to be extremely accurate and I can't run over what I just planted and you don't want to skip a part of your dirt and miss a planting opportunity. Harvesting is an area where I have more variability because I can almost rerun a path and pick up the corn or the grain or the bee spraying or crop protection where you're fertilizing or you're applying herbicide, pesticide when your crop is growing. You don't want to run over anything. So there's super, super low tolerance for any variability and that's where the combination of satellites where you can get centimeter level accuracy, path planning and path recording so you know exactly where you ran throughout the season, all help us drive that variability down. But to your point, you know the complexities of you know autonomy are just as high, so I'm not worrying about you know a dog running across the street per se, or a kid stepping out into the road. But when you've got a you know eight ton machine running through a farm, so to speak, and all of a sudden that tillage, that tillage machine gets clogged and the last thing you want to do is damage a million dollars, sell, you know. Or if I'm about spraying, you know, the last thing you want to do is over-reply chemical. And so what we're doing is we're creating a huge sensor network across the whole machine, both the vehicle and the implement if it has one that it's pulling, you know. So we can communicate very clearly with the farmer what's going on and they can log in and they can actually see the display and make adjustments on the fly while that vehicle is moving. Our goal is, you know, we want to have the least amount of false positives, you know, per acre, and so you know, you think, maybe one false positive of an object per thousand acres where the vehicle just stops and says hey, farmer, I think there's something here. Please come check it out and verify if I can move or not move.
Speaker 4:Construction is a little bit different because construction environments are so much more dynamic or it's not a common for an operation construction, you know workforce to walk around the vehicle as it's operating, and so in that case it's trying to create a safety zone around the vehicle where, if the operator is about to swing the boom of an excavator, it knows exactly how to change its algorithm and ensure nobody's around it, where, if it's digging in one way and somebody walks behind it and there's no risk to that person, they can still operate.
Speaker 4:And so those are the interesting factors. And so you know, when I get asked like gosh, mark, can you just create this app in like a couple weeks, you're like oh wait a second. No Right, I was just in the field this past week getting an overview and doing a deep dive on our autonomous tillage and AG, and one of the tools we built is it puts on a computer screen all in the obstacle that's detecting, and you know it's super sunny and Sioux Falls in the wintertime and you know you have undulation on the ground that we're doing our tillage tests on and you have wonky shadows that come out and like we had a shadow that kind of looked like a person and all of a sudden the tractor stops and it's like, okay, now I got to figure out how do I program the tractor to dilinate between a real human and a shadow, and that gets to be a really interesting problem to solve.
Speaker 3:Yeah, for sure, because you're doing that with cameras, right, you're not using, like lead R radar?
Speaker 4:It's an and not an or. So, yes, I've got eight cameras around the vehicle and I'm using radar at this point in time, and you put the two together to get the you know, the ultimate safe environment.
Speaker 3:All right, cool. Yeah, I want to talk a little bit. You guys have been winning a couple of different design awards. Here you got Project Zeus won the prestigious good design award, and I believe there was also a different award that you guys got for the IH Electric. Is that accurate?
Speaker 4:It's. I'll talk about the electric vehicle first. Okay, you know it's one of the things I think we're super proud about. So you know, for both of our products on brands between New Holland and case IH, we built a 75 horsepower equivalent utility electric tractor. This is a tractor that can have a front loader bucket on it. It has the ability to have some autonomous features and so for us in particular, it's got the ability, what we call follow me mode, and so I, as the operator, can get out of the cab, walk in front of the tractor and the tractor will follow that, operating wherever you want to go. So if you're speeding up, you're slowing down, you're turning left, you're turning right, that tractor just followed you and the use case.
Speaker 4:I don't see this for ranching. So as you go through ranches and you got to go through these fence posts all the time, right, you get out and open fence, you move the vehicle on and on. Now you can get out, open the fence, walk forward. The vehicle comes through, close the fence and then hop back in and continue your work. But you're talking a four hour continuous runtime which allows you to work a half a day.
Speaker 4:It's got a fast charger built in so you can plug it back in to a 240 volt plug and have an 80% charger within an hour and then go out and get another three hours of work done, and so you get almost a full day of operation. What's interesting is that we've seen in the patterns, though is rarely you run continuously so on a single charge you can probably get up to six hours if you're starting and stopping throughout the day, which that effectively, with that fast charging capability, we believe you can get more than a full day's worth of work in with that vehicle. It's a pretty fun application of electrification because it allows for, you know, obviously zero emissions, it allows for zero noise, but more importantly, in the farm application here and in projects used on the construction side, it's the torque, and the torque to the ground that you get, which is instantaneous, unlike what you see with traditional combustion engines.
Speaker 3:Right, there's no lag right, right, and there's no building up the RPM or anything, and I think also you know what we've seen.
Speaker 3:We've got a couple of friends of ours that have gotten into organic farming and have you know they're trying their hand at growing grapes and doing the vineyard thing and getting into wine production and things like that and they seem very interested in electric because they don't want the diesel particulates and the emissions to get on the grapes and get on the organic crops that they then would have to clean and spray and everything else. Are you seeing some of that interest from those markets or who do you really see driving the development of like the electric farm all? Or you know the new Holland T4?
Speaker 4:Yeah, yeah, so there's I'd say there's three drivers. It was orchard. Vineyards are absolutely on the top of the list. You have a high value crop right that has a premium price point and a very discerning customer, because you're going farm to table.
Speaker 4:in that regard, You're not it's not like wheat which is going into an ingredient, so to speak, right, and they can sell their product based off of the sustainability practices on the farm and manage pricing in that manner. The second is municipalities. So, as municipalities are trying to drive towards green energy, the electric tractor in that case, is often being used in landscaping, mowing of common areas in a city, you know, like work around city hall or construction. And then the third would be dairy farmers, where you're often bringing that vehicle in a barn and pushing feed up for the cows to eat, and the last thing you want, as a farmer or the cow, is to have all this exhaust sitting inside of an inside barn. And so those are examples where we see the farmers leaning in, either because of the sustainability, the noise or the pollution.
Speaker 4:On the construction side, you know it's primarily around work and noise, and so there's all kinds of city ordinances coming out now that are essentially banning noise from certain hours, which, as a citizen, you understand it's like the last thing I want to be. You know has woken up at 6am, but when you've got a vehicle that doesn't make any noise, it's a heck of a lot easier to get around that. And then the indoor applications for construction. Right, thinking about breaking up a foundation or operators in a distribution center, you know, or as you close the building and you're still doing work on the ground, you know not having any of that pollution coming into the air is just safer and cleaner environments operated.
Speaker 3:Yeah, all of that sounds right. You know we talk a lot about the noise ordinances and people want to live in, you know, new buildings. They want to have all the amenities, they want to have bright, clean Construction and you know even where they want to put in bike lanes and things like that. You've got this constant demand for new housing, new infrastructure, more and more, but they don't want to hear it, they don't want to smell it, they don't want to understand any part of what goes into making that happen. They want to close their eyes one day, wake up the next morning and have a brand new, shiny building there.
Speaker 3:And it is just shocking how far we've come from understanding what needs to go into building out the infrastructure of a city. When you start layering that with no drip job sites, with you know noise ordinances and things like that, it's just shocking. You know you may not be able to kind of tell us this next part of where do you see the next big application of what there it's electrification or automation? Where do you see, for CNH, this kind of technology really coming into the mainstream?
Speaker 4:Yeah. So I would say construction continues to lead the way for electrification. And there's there's a couple reasons for, and you just you just hit upon one of the biggest, which is noise, noise ordinances. But it's also a fixed area of operation. So for your mini excavators, you compact wheel loaders, your tractor loader back hose, your compact track loaders, those all tend to operate a really confine, relatively confined area where there's high power available for charging, you know, versus a combine which needs to run 18 hours a day over 10,000 Acres and you can't get a battery big enough without having it sink in the mud, operate right.
Speaker 3:Right. Well, and that's a that's a really good point. You know, in some of those applications, a lot of the the case for Hydrogen as a zero emission fuel or the case for, you know, diesel hydrogen blend to run a conventional combustion engine but with a blend of diesel and hydrogen to really cut back on those emissions. You're starting to see some of that, especially for that reason where the kilowatts of energy that need to go into the work that needs to be done in 24 hours in a day, it is not feasible with the current energy density of the batteries that are out there. So what is CNH, whether it's the case, or New Holland? What is it that you guys are doing to kind of, you know, meet those tier five emissions that are coming in, kind of meet that green Kind of mandate that's coming down, whether it's from politicians or customers?
Speaker 4:Yeah, I think it's a great, great question and you know we are very much behind the biofuel movement, be it ethanol or methane or some blend of Hydrogen. You know we want to make sure that our engines, you know, can operate any of those environments. And you're 100% right, we do believe that biofuel is what's going to drive the heavier product, the heavier loads, for quite some time to come. It's cheap, it's getting cheaper. We're still a little bit limited on distribution and the technology is readily available, and so one way we're helping this with production and distribution is we have a partner called Benamin.
Speaker 4:Benamin was a UK based company.
Speaker 4:They created a unique Process to essentially cap a slurry pit on a dairy farm and take the methane, get gas that comes off that slurry pit Converted into either liquid, work compressed natural gas, and then that could be funneled right back into our T7 or magnet tractors and and now as a dairy farm where you're your own fuel producer, so all of a sudden your costs go way down.
Speaker 4:We're seeing that they're they're producing excess fuel, they can sell back into the market, and so Benamin will come, pick that up from the farm and redistribute and pay that farmer for that fuel and at the same time they're creating a easier to Spread manure so they still have the fertilizer benefits of the manure that that's in that slurry pit all the way to the point. With our engine partner Fiat power train, we have Methane-based generators so a farmer could go 100% off the grid in that regard and you know. So now it's really scaling that operation and starting to expand it and you've probably seen Methane is a big component. You know around landfills and others that are happening here in the US and dump trucks and Garbage trucks are starting to run on it and so as that distribution expands, you know we would expect, you know, high horsepower tractors, combines, high horsepower products, like the dozer that's got to go over distance, or a road grader to be able to start to operate off of the biofuels.
Speaker 3:Yeah, that's awesome. I'd love for you to send me some more information on that, maybe once we wrap up here and you know, I realize we're coming to the end of our time commitment. I just want to thank you again, mark, for being a part of the show. You know you mentioned a couple things about how you'd listen to some previous episodes. I hope you listen to this one and enjoy it and, you know, I guess before you sign off, can you let us know people listening how they can follow along with what you're doing and learn more about C&H and case in New Holland.
Speaker 4:You got a place to go with cnhcom and if a lot of content on our corporate website and from there they can link over to case IH New Holland or case construction. And I really appreciate your time today, joe, it's great talking to you.
Speaker 3:Yeah Well, mike, you, that was your first job, wasn't it a case dealer?
Speaker 2:Yeah, my first construction job. I worked for a rather large C&H dealer. We sold the case to Holland, the Belco, and we were spread out over, I think, four states nice.
Speaker 3:All right, we're coming back. That was a good one wasn't it.
Speaker 2:It was good. They know what they're doing. They make good stuff.
Speaker 3:They do make good stuff, and I think that the thing that I really like about that company You're kidding. You're kidding they don't make good stuff. Of course they make good stuff.
Speaker 2:Now I was being sarcastic and I but no, c&h is a good company, they've been. The thing is is people won't realize how long C&H has been around. I mean going back to, I mean case, going back to the steam powered tractors and stuff like that. You know, early days of farming.
Speaker 3:I was gonna say the farm all first come out, what like 1908 or something. I make that up, but I don't think I'm being that crazy. Actually I'll Google it. So 24 they released the first farm. All you can still go buy a case farm all right now, yeah. So yeah, they've been around. They're coming up 99 years. So they're coming up on their 100th year anniversary. So that's pretty exciting there.
Speaker 3:But you know, it's funny, there's a lot of the old brands that are doing really well. You know we talk about Farm All Gravely just celebrated in 107 years. We talked about that a couple of episodes back. But if you look at companies like Mac, mac is just pouring money into their new Roanoke Virginia facility. They're just expanding that MD line so they can put more of those Mac MDs on the road.
Speaker 3:Yeah, deer is pouring a whole bunch of money into North Carolina. They're doing their electric line up there that they're adding 50 jobs, $3.3 million of tax revenue, 115,000 square foot facility that's going to be able to produce two gigawatt hours of batteries specifically for agriculture. And I don't know if you would call golf courses agriculture, but this is something that they've been really announcing recently. Is you know, to do these golf courses and do a lot of urban landscaping, that kind of tractor work, where there are now so many noise regulations that you really can't get the job done at a reasonable time without something that's quiet and that's where this electric stuff really comes into play is you can get this job done quietly?
Speaker 2:Well, it'd be nice if you, if you were maintaining a golf course or a country club or anything like that and you needed to, just because of you know the way that the tee times were scheduled and you needed to be able to get something in there and maybe mow or maintain some stuff late at night or later in the day to break it up or early in the morning.
Speaker 2:That'd be awesome to be able to do that without, you know, annoying all the people that have bought homes around the fairways or, you know, we're also out there trying to get their day going before the noise ordinance kick in. So I think that that is going to be a huge market for electrification. I also think you're going to see, just as you saw propane take over a lot of the commercial mowers you're going to see a lot of the battery pack stuff. Actually, I'm surprised. I'm looking forward to seeing what Milwaukee offers, as they release some stuff and I don't know for a fact that they're. I've just heard rumblings that they may be working on turf stuff. That would be interesting as well to watch them come out with like smaller mowers or maybe you know they've already got trimmers and stuff like that.
Speaker 3:But to see what else they have for cutting equipment.
Speaker 3:Well, it's funny because there's other companies that are out there. You know there's one called Greenworks. It's been doing outdoor power equipment. They've been doing like edgers and trimmers and weed whippers and stuff like that, but they're electric power. Then they recently come out with chainsaws. They recently come out with a snowblower. Now they've got an electric riding mower. It's like an 80 volt riding mower. It's not anything big but you'd certainly use it if you had a decent sized yard.
Speaker 3:And it's funny to see these manufacturers that have big names in the industry and they're going smaller and kind of trying to get into that niche. And then the smaller companies that are going the other direction, right Like they're trying to grow into that niche. So it'll be interesting to see who ends up where. But yeah, I think I think it's a great idea.
Speaker 3:And you know and I mentioned this talking to the guy from Case that comes back to this idea that everybody wants to have their cake and eat it too. They want the clean, manicured lawns but they don't want to hear the lawn mower going off in Saturday morning or whatever. And it just can't happen. Some things got to give. Most of the suburbia is like that. Most of everything is like that you get into Chicago, you get in New York. People want new gyms, they want amenities, they want new grocery stores, but they don't want to have any kind of construction. They don't want to have to walk underneath scaffolding, they just want to go to bed one day, wake up the next morning and have a whole new utopian existence.
Speaker 2:One day, when the replicator comes out and we're able to replicate and go to the holodeck, then we'll have that.
Speaker 3:And we won't have nothing. Dude the day, they something 400 pound shrub idiot drinking Mountain Dews and eating Taco Bell all day. You'd pop into the holodeck and make out with, you know, angelina Jolie or whoever's hot in 2024. It's over. He's not going to get up and go to work unless he's got to. You know, whip up some holodeck credits.
Speaker 2:I don't think he's going to go to work. We need a balancing act.
Speaker 3:If that ever happens, you're going to have to have Well, I think the rule is going to be you're going to have to put in 40 hours of work a week to get four hours on the holodeck. So for every 10 hours of work, you get an hour on the holodeck. That's the only way it's going to happen.
Speaker 2:Otherwise, when that guy does go to work, whatever he's helping build, they're going to have to recall back. That's what's going to have to happen. They're going to be like who put this together? I don't know, but the holodeck Joe was on the line last night.
Speaker 3:They hit the all stop button.
Speaker 3:Phipps, look at you cards going. That's not what recall means. But while we're on the subject, yeah, packard had to recall 47,000 trucks due to an issue that could result in a total of loss of steering control. That's a 47,200 Nate model year 24 and 25 Kenworth T2, 80s, 380, 486, 80, 880s, l, 770s, w 190 models and the model year 24 Peterbilt 380, 9s. The last of those are all getting recalled 520, 535, all the way down the line. So that is a lot of trucks, man, and I got to tell you that's a lot of two.
Speaker 3:That's a lot of trucks. But it's scary too, because when you talk about Ford doing a recall and they read in the paper, you know all they had to recall 110,000 vehicles to get that airbag replaced. Right, that was a couple of years ago. I mean, all the car companies were replacing the airbags that they were getting from this one supplier. There is a system in place for Ford's. You know, 3,500 dealers to each one of them. Take two or three of those a day and over the course of a very short couple of weeks get that done. There are not 3,500 Packard dealers and certainly they don't know they're not all sitting there with 47,000 new steering racks and knuckle assemblies to put in there. This is going to put these trucks on the sidelines for a while.
Speaker 2:It's. You know the knuckle that they're replacing on the Packard stuff and then you know. Then you get the international recall where they're going through that. I'm glad that they're going through this, I'm glad that they're not, that they have to, but I'm glad that they have the things in place that even in the commercial class, eight industry, medium duty, they hey park these things, do not sell them or bring them back in. We got to get this fixed. A lot of this stuff it gets overlooked. Everybody wants to talk about GM and how Honda and those guys have recalls or the infamous. What was it? The Toyota one with the four maps? Is that? Who that?
Speaker 3:was yeah, what Mike's referring to is when the Prius, the second generation Prius, come out. I think it was like oh 607. There was a guy who said his accelerator got stuck and the car was just going nuts and he was driving a hundred and some miles an hour down the freeway and he was waving his arms out the window that he couldn't stop and everyone was like, oh yeah, these hybrids, man, there's computers are taking over the cars who never get there. And it turned out he had his floor mat stuffed on top of the gas pedal and so they had to do a massive recall and they actually redesigned to the floor mats. It would latch into place and go over and cover the gas pedal. Because it was happening, people were just rear-ending each other in these Priuses.
Speaker 2:Yeah, and I don't know how many documented cases there were at the end of the day of that. But we always listen to that. But a lot of times the medium duty and the heavy equipment stuff gets overlooked. They call it a recall on the on-road stuff, they call it a pit on the heavy equipment. It's a product improvement program, so nobody talks about that. It kind of gets glossed over is what I'm getting at.
Speaker 3:But that's what we're here for. We're here to talk about all this stuff because this is the heavy equipment podcast, darn it.
Speaker 2:This is what we do. This is what we do.
Speaker 3:You know, it is a show about nothing, but it's a show about nothing that is particular about something.
Speaker 2:We haven't. Yeah, we're very particular about what we talk about.
Speaker 3:Yeah, this is heavy stuff, but I'm strong strong enough to carry him. He ain't heavy. I don't even remember what we're talking about.
Speaker 2:We were talking about the recalls and the fact that they get glossed over, because it's heavy equipment and really, if it wasn't for us, a lot of people wouldn't talk about it. There's news articles out there about it, but we're really the ones shedding the light on it, doing it live.
Speaker 3:We're doing something out of there, right?
Speaker 3:It's interesting too, because different companies handle recalls in a very different way. Right? Tesla doesn't even want you to call them recalls, right? They want to do everything over the air. They want to basically email you an update and hope for the best that's going to fix it. Ford wants you to come in. They'll do some over-the-air stuff, but Ford wants you to come into the dealer.
Speaker 3:It's going to be interesting to see as these new manufacturers come online, because it doesn't think we don't talk about much is that we've got Rivian. That's a new manufacturer that's come out in the last two years. Scout is coming back. Scout is going to come back with SUVs and pickups. Volvo, their parent company, Geely, has a new truck brand called Radar. They're manufacturing out of Mexico DYD, which is that's a Chinese company that Warm Buffet has heavily invested in. They've been making literally millions of vehicles. They've been making cars in China and Europe now for decades and they are opening a plant now in Mexico. They already have a manufacturing facility in California where they do buses and heavy equipment chassis and things like that. As all of these brands kind of come into the market, they're going to have to start to think about how they're going to handle not only Pips and Recalls, but how are they going to handle quality control for a North American audience that for the last 30, 40 years has really had very few companies come into it?
Speaker 2:Yeah, I mean, people are coming out. They get new companies, new partnerships. How are they going to handle this? Even right down the marketing, the marketing on a Tesla was different. That was a new model of how to capture buyers Right. It's going to be interesting to see how that happens.
Speaker 3:No, I think that's a really good point, that the marketing is going to be interesting too, because, just like in the 70s and the 60s and 70s, you had a lot of people that were at that time in their lives turning 40 and getting into that middle age where they're buying a big car and it's time for them to buy a family stand to drive around in, and Toyota and Honda was coming into the market. And those guys that were in their 40s at that time that's that prime car buying age they remembered fighting Japan in a world war 20 years prior. You know what I mean. Like these guys are. Like I was in Japan. I was just fighting these guys and you got to imagine the same thing was happening to the Korean War veterans when Hyundai came out in the 80s and they were like what are you talking about? When I was a kid I was fighting over there.
Speaker 3:And now we've got a lot of animosity and a lot of cultural animosity, even though there was never a conflict between the US and China. There is this sense of people that the Chinese manufacturers and the Made in China movement that the corporations did really destroyed Main Street USA and that kind of way of life that people had for generations. And so there's there's a lot of, I would say, cultural anger against China. So, as all of these Chinese brands and Indian brands start coming into the US you know you've got companies like Mahindra and things like that that are bringing tractors and trucks into the US I think they've got an uphill battle that they're not really anticipating because I don't think they understand that there is that cultural anger there, that patriotism there that says, like we're supposed to be against you guys. Whether or not that's true, that's the feeling.
Speaker 2:No, you're right. Yeah, whether or not it's true, it's still out there, it's still deceiving. You're going to see people fly away from stuff and it's going to take a little bit of trial and error to have an OEM get somebody to say hey, you know, I went to the dealership. They were pretty cool over there. I like what I looked at, I like what I ran, I'm going to buy it. Yeah, it's going to take that one on one experience over and over again to when these kind of buyers over, because you're absolutely right, we have been very much old. You don't buy Chinese. It's like my daddy quates it way back in the day when he was younger and it was like well, there's the problem. This was made in Japan. That exact line was used in Back to the Future. Michael Fox says what's one of the best stuff made in Japan? Right, yeah, we're globalizing a lot of our market and we just I don't know they're going to have to be careful how they go about it. They do it right, it's going to be success.
Speaker 3:Well, but here's the thing how many guys are sitting there going? You know, all this junk is made in China and they're typing it on a Made in China MacBook or iPhone, right? So there's a little bit of hypocrisy there and I think it is going to take some time to understand that. I think it is going to take some time to figure out how to market to it. I think the ones that are going to be the most successful are the ones that are going to show up to these, you know, like Con Expo and Work Truck Week and World of Concrete, and let people get behind the wheel or get into the cab and feel the levers and do the thing and really see for themselves that this is a quality product.
Speaker 3:Because I got to tell you honestly, I was at CES a couple of weeks ago and they had a BYD, which is an electric Chinese car, and the only question that anybody asked was do you think this is ready to take on Tesla? And I got to tell you everything I saw from the paint to the headlights, to the screens inside, to the way that the seat felt on a lower back Everything told me that that was a better vehicle than the Tesla, and they were doing it for right about the same price too. So I think China is coming in, and I think if we're going to pretend that they're not, it's just going to hold us back.
Speaker 2:Yeah, we're going to. We're going to see a fair amount of new vehicles come out, new product, new tractors, all of that, yeah. So we're really going to shake up quite a bit of things. And going back to the recall thing, how they handle the recalls. Nothing is perfect, it's still manufactured. How they handle that, what they do with it, that's going to make or break them, no doubt.
Speaker 3:Yeah, I agree 100%. So you know it's funny. I don't I hesitate to talk about this because I feel like you and I get along. We operate on the same wavelength. We've known each other for many, many years. We've never really had an argument that has devolved into anything nasty, and I know you're a Milwaukee guy, but I have to confess that I might be a Ryobi household.
Speaker 2:No for the household. For the household. Ryobi is amazing. That's so patronizing. For a lot of construction-related solutions yeah, for a lot of construction solutions it is not. I mean, it's a good product. We've done hours for hours testing on product and if you're going to use it at home, ryobi is awesome. If you're going to use it around the farm, you're going to use it around other areas, it has its place. It does a very good job. If you're going to just beat it constantly, no, it just doesn't last.
Speaker 3:Yeah, no, I've honestly heard that before and you know Milwaukee makes a tremendous amount of really heavy duty quality hand tools and battery tools. You know we talked about that a little bit in our last episode when we talked to the Mo guys and over here at World of Concrete in Vegas, dewalt, milwaukee, Tool, bosch they all had battery powered tools. Like you know, they're talking about real high end stuff that you're going to use day in and day out on a job site and I have to admit you know the Ryobi stuff that I'm into just wasn't mentioned in there.
Speaker 2:Well, if you want to comment on that We've done product testing on that and we have things that we've used for solutions we themselves will tell you yeah, we're not in that market space but that's okay because the market space needs Ryobi, dewalt, milwaukee. They need the off brands, the US generals that come from Harbor Free. We need all that. We need that, without question. Everybody has their place in the pie. No one's going to cover it from one end to the other Right Not at all.
Speaker 3:Well, I think that's good stuff. Maybe we'll wrap this up with some big trouble in little China, since we closed it out. Talking about Chinese market, china is here. China is here. China is here.
Speaker 5:Listen to the old pork job express and take his advice. On a dark and stormy night, all right, when some wild-eyed, eight foot tall maniac grabs your neck, taps the back of your favorite head up against a bar room wall and he looks at Cripton in the eye and he asks you if you've paid your dues. Or you just stare that big sucker right back in the eye and you remember what old Jack Burton always says at a time like that have you paid your dues, jack? Yes, sir, the check is in the mail.
Speaker 1:Tune in next week for more heavy equipment podcast on Spotify, apple Podcasts, google wherever you find podcasts.