Fed Getting Feddy, An Entire Tesla Neighborhood, and Hydrogen Advocates

‍SPEAKERS

Kyle Mountsier, Paul Daly

Paul Daly  00:23

Y'all, we're rounding the corner on a Thursday. Today we're going to talk about the Fed getting off Fetty to new word on the entire Tesla neighborhood. And let's talk a little bit about hydrogen for once. I don't know that we've ever talked about hydrogen fuel cell powered cars on the show, I

Kyle Mountsier  00:42

think we have that which is really good. You know, I think we I think we need to bring that in. Because it's a it's a logical option. So I'm especially when

Paul Daly  00:51

I don't know a little manufacturer, like Toyota Motor Company, seems to think there's something there. We'll get to that in a second

Kyle Mountsier  00:59

measured approach measured approach. Yeah,

Paul Daly  01:01

let's go. I mean, I do just trust their thinking on things. They just have a decent track record just a little bit. All right, we'll call it a passable track record. Oh, well, good morning, everyone. We're hoping you're having a good start to your Thursday. Just a couple of notes. In the beginning, I want to remind you that we are going to be leading a creative track, the industry's first ever creative track built just for people who actually make things in automotive, underserved for all of eternity past in automotive, but we're changing that Brian Pash asked us to put together a creative track just for the creatives at this year's modern retailing Conference, which used to be triple as it's in November 13 through 15th. We're gonna have limited slots available, but we're bringing in Darren Doan, and Nathaniel, Greg Glick and Ellie pinion, and Kyle and myself, and we're gonna like have this little cohort, we're going to talk best practices, talk about equipment actually make things. So if you're creative, you should get that get there a sotu.com, forward slash M AR C, a soda.com, forward slash MRC. And if you need help convincing your GM that it's a good investment to send you there. Let's send them our way.

Kyle Mountsier  02:09

Well, we'll take care of that

Paul Daly  02:12

we'll do we I mean, I won't give you 100% Promise, we'll be able to do it, but I'm gonna give you 90% chance

Kyle Mountsier  02:17

we will we will be we're very persuasive when it comes to that. So let us let us in Yeah, because here's the thing, we we need better creative in our industry. And so it but that takes like a large swath of people across the industry kind of pushing the boundaries to show others what's possible. And I think that what's cool about this as it is, it's going to be a place where we we actually create some things that show the industry, oh, we can do this as an industry that and make this feeling really good. And every community of what so dealers are creating,

Paul Daly  02:51

here's a little proof, here's a little proof in that pudding. We are hiring right now we're looking for content creators, a junior writer, maybe a Community Manager to manage some of the platforms, specifically Facebook. So we started our first post for a content producer or content creator. And when we put this into LinkedIn, LinkedIn said based on the position are looking for in the salary range that we estimate, if you spend $250, you will get 27 applicants. Were like, let's try it. We really need somebody that believes what we believe. So literally 24

Kyle Mountsier  03:25

hours later on, on what a fifth of the budget we had

Paul Daly  03:29

on 77 bucks, right? I think you said there's like 117 applicants on $77. And here is the variable. In my estimation. It's because the job ad is freaking awesome. The content is good, the creative is good. And so I don't know what you can say the ROI is on that. But there's substantially a notable ROI on that. So and by the way, we're hiring. We're also going to be at name Edie. That's coming up soon. She's like less than 20 days from now. We're going to be in Miami with Daymond Lester and the crew we got a panel coming up with Alex Vetter, Perry Watson, Alex Flores. So if you're going to be named Matt, we can't wait to hang out with you and jam a little bit there. We're also going to be in Atlanta, late October Eglin Lindsay's 800% meeting so more details on that but you know, we got we got a couple of trips and we also have some other things October is gonna be a thing dude,

Kyle Mountsier  04:19

it's gonna be a thing.

Paul Daly  04:20

It's gonna be a real thing.

Kyle Mountsier  04:21

Well, speaking of a thing Whoa. Segue that's the only way at this point to describe what's happening with the Fed and interest rates because it's just become a thing. Right? Yes, you're obviously a large part of the Communication and Mass Media is about what's happening with inflation is a is a recession it actually here is an imminent or what did it already come and go? But yesterday was, as we mentioned on the podcast, a suspected an interest rate hike, there were comments that it might be between 50 basis points, the 75 basis points. So it looks like point seven, five, so three quarters of a point interest rate, marking the fifth, the fifth rate hike this year. And there's no signs of the increases slowing down. Federal care of Jerome Powell ramps the new rate hike, while adding that rate hikes will continue until inflation is reined back in as they forecasted another 125 basis points vote. So 1.25% In the next through the end of the year, noting that a soft landing for the economy was not likely

Paul Daly  05:39

the it's kind of so I hear David long in my ear right now. Don't forget to choose not to participate or not to participate. And and it's not that we're leaning into this to to like choosing to participate. But the truth is, is that this is going on, we talked yesterday about purchasing price, purchasing power reducing significantly with every rate rate increase. And I think the reality is, is that when you zoom out for a second, you look at it in the broader perspective, in 2008, the height the rate was zero, right? It was unprecedented, the economy was doing way worse than it is now, right, like way, way, way worse. And then we've had this long period of low interest rates still kind of historically low interest rate. It's just not what we're used to. We're only going to see what happens as it plays out. So nothing changes from an auto dealer standpoint, from an operational mindset, or a brand marketing mindset. It's like, what do you do in every season, you get operationally efficient,

Kyle Mountsier  06:40

you get really good at telling your story. You give the consumers what they're looking for right now. And affordability is an issue. So how can you ease that pain and talk about being the best place and the most empathetic place to ease that pain, right, and then from that point on, it's like, rinse and repeat over this, but it's the empathy of acknowledging the situation for a purchaser doesn't matter. Like that's, hey, we recognize that interest rates are, are increasing. And we realize that change is your purchasing power. So what we'd like to do is walk through what your purchasing power is, and the vehicle that makes most sense for you to find a vehicle that matches your budget and your wants and needs. And if you empathize in that way, then it's not like you're kind of like pulling the wool over anyone's eyes. You're not tricking anyone into thinking like, we got an interest rate magic Park marker over here. Just like be real be where it's at. And people will. It's not like people don't know that this is happening. It's just that you're aligning with their intentions, you know, their their knowledge, and then the like, the conversation is a lot easier.

Paul Daly  07:50

Yeah, there's nothing like in just from a communication strategy, in general, not just marketing. But when you say out loud the thing that the other person is already feeling, you know what starts to happen? They start to nod their head, right, like, yes, yeah, I agree with that. You understand me? And so if we know rates are going up, and we know rates are causing affordability issues, then when is the best time to get a car. I need one right now, right now, which is a good formula for someone who happens to sell cars. It's perfect. It's a good formula. Oh man, speaking of. Speaking of planning, I'm switching my segway. Segway and I was wondering where this product had gone because it was paying attention to it. But an entire neighborhood of homes equipped with Tesla solar roofs and power walls had been steadily moving forward and kicking into high gear a partnership with Brookfield Asset Management and Decker with is making a 12,000 poem, Project neighborhood reality as Tesla's quietly ramped up installation crews as they move the first Tesla's solar neighborhood, which is called Easton pockets, and of course, Austin, Texas, and that to be a reality, I don't even know what a 12,000 home neighborhood looks like, oh, it's

Kyle Mountsier  09:11

huge. We've got a couple in Nashville. It's unbelievable. I mean, they just seem to go on and on. But this is on zip code. So okay, so I just I like it would have to be creepy driving through this neighborhood. Because, you know, like, if someone wants to buy a house with a Tesla roof, in a neighborhood that only has Tesla house roofs, they probably got a Tesla or something that looks similar to it. Probably probably in a certain income range. I'm just I'm just saying like, there's some there's some

Paul Daly  09:48

you know, I looked at the house situation. I don't I don't think it's as eerie because if you haven't seen the Tesla Versailles, I can put that back on the screen really quick. Oh, the coolest thing about Tesla's solar roofs or they just look like regular roofs they write, it doesn't look like solar panels, they have different styles, different colors like so from the ground, it actually just looks like a normal, a normal roof. But there are also all these value propositions that come with having a solar roof ecosystem where it's constantly charging, filling the Tesla Powerwall, which is just basically a giant battery. It's a battery that you know, can store energy. And then when there's no sun, right, it provides, here's the deal. It's like, this, these rooms lasts forever. I actually remember a quote from back when they first announced it, and they said 200 years from now, your house would be a pile of rubble, if everything stopped, your house would definitely like decomposed into a pile of rubble, the only thing remaining in 100 years, 200 years would be your Tesla solar shingles. Right. And so it's like it's a one and done roof solution. But we got a quote here from an Eastern Park resident Mario de, he said it was far cheaper to have the roof installed when the home was built. Versus he put the same specs into like the calculator to see what it would cost, you know, new way to yard roof,

Kyle Mountsier  10:59

installing a new roof, installing all of the piping and

Paul Daly  11:03

wiring. And here, and he said, based on his energy usage, and like he already tries to be conservative with his energy usage. He's like, Oh, this roof is going to provide a passive income stream for me, as I sell power back to the Texas grid. And I don't know if you've heard but Texas could use a little more power.

Kyle Mountsier  11:20

That's a strong value proposition for any community builder to say, hey, look, we're going to build a community give us some potential incentives from a state because we're going to push back into the controller, the power grid, because most most people aren't going to use the power that a full solar roof puts out like nobody's nobody's using that much power.

Paul Daly  11:44

And these are so efficient, like it's not if you think about like solar panels on your house, you have these big square blocks or rectangles on top of your house and they there's a lot of inefficiency in the area that they cover. Tesla solar roof is every shingle every angle covered. Yep. So I mean, as as another little like kind of punchline to this. Tesla also started a separate company to create what they're calling virtual power plants that kind of gathered together the power from from all of their, you know, you know, solar generating energy sources, and they sell it back to Texas. So

Kyle Mountsier  12:18

rolling brownouts and blackouts got you on that too gotten, right. I mean, you think

Paul Daly  12:23

about it is easy to think of Tesla as a car company. But you know, they would they would say that they're they're a power company, right, and battery cell and the Giga factories. And the solar rooms are just like you start to think of like, how far this could actually go if there is some level of mass adoption. And, yeah, I mean, because the race for energy and the uncertainty of the energy supply in the future is, it's a real thing. It's a real thing. Speaking speaking of

Kyle Mountsier  12:49

energy supplies, segway get it? Marcus Hein, the head of mobility for Bosch says we need to lead on, on experience, as he warns that we need an alternative alternative to lithium ion batteries in order to avoid a supply disruption, which we've talked a lot about. So thinking about our previous story of like how much lithium ion is needed to power so to have solar panels, and the power all these electric vehicles, like there needs to be other ways of going, going about this. And he's mentioning that Elon Musk's limited view of hydrogen fuel cells, saying that, like it's not a viable option, because they're not as efficient of BVs. But Hein says the that the hydrogen fuel cell solution should be another consideration. And I'm starting to see this like this, like kind of undercurrent even on things like social media of like, hey, remember when we were talking about hydrogen seven to 10 years ago, we've actually got the technology now ready to come to market on a mass scale like we can produce these type of engines. And I think it's going to kind of be like a late adoption curve on that because the technology is catching up with the need for at this point.

Paul Daly  14:15

So we have a little video here that explains how a hydrogen engine actually works. And again, like like Kyle said, the big point is this. Hydrogen engines are not as efficient as electric engines because I mean, are batteries because the battery just produces electric right to the motors. It's still like they still run on an electric motor platform they're still not so but the battery produces electricity or provides electricity hydrogen, you have to actually convert the hydrogen through combustion process to turn a generator to create electricity right so there's one more step in the middle of their Isaac Rolla video this is a great little tick tock video explains it quickly. So I want

14:51

to tell you how the children arise hydrogen fuel cell system actually works that all starts with the hydrogen fuel nozzle. What this gives you access to is three tanks containing 5.6 kilo grams of hydrogen at 10,000 psi. Once you fill this up, that hydrogen is combined in this fuel cell with the oxygen from the outside air. Inside this fuel cell, a chemical reaction occurs between the hydrogen and oxygen molecules, thus creating electric current. Electric current sends power to these batteries, which eventually power the motor to the rear wheels. The best part of all this is in fact, the byproduct of the chemical reaction is h2o, which is water and you can actually see the water form underneath the vehicle because it leaks at the bottom.

Paul Daly  15:27

Okay, so that is the basics on how a hydrogen fuel cell vehicle works. Two points here. The first point is I couldn't find it, but I really wanted to find it. Somebody accelerated in a hydrogen fuel cell vehicle and it sounded freakin awesome.

Kyle Mountsier  15:43

Oh, I'm sure it does. It's yeah, that combustion has to go somewhere.

Paul Daly  15:48

Right? It's like, yeah, it just sounded cool. It sounded like I don't know, it just sounded definitely familiar to what a combustion engine would sound like kind of like if it's like, turbocharged and compressed. And there's still no shifting right? So electric motor, so there's no shifting. But like the sound of that going, it was pretty great. Second point is that it only takes four minutes to refuel the vehicle for 300 miles of range. There you go. That's right. That's a kind of a compelling, that's kind of a compelling,

Kyle Mountsier  16:17

is what you're trying to say, is that right?

Paul Daly  16:20

But you also can't charge it I love it spits

Kyle Mountsier  16:23

out water. You're like, what do we do with whatever happened here? Well, it kinda like, you know, falls on the ground and then evaporates.

Paul Daly  16:33

Yeah, right? Because that's water gotta be healthy in some way.

Kyle Mountsier  16:38

I feel like, you know, gotta

Paul Daly  16:39

be healthy. Well, it's healthier than other things. Or I don't know, I don't know how you accumulate hydrogen. That's like the missing piece in my head. How do you accumulate the hydrogen to put in the tanks? Like, how is that bind harvested? Gathered,

Kyle Mountsier  16:51

we should do some research, we'll do some research and let the people know, actually, I've got a good friend that knows a little bit about this. So maybe we can bring him on? Maybe that'd

Paul Daly  16:58

be great. That'd be great. Hey, like, we're just trying to like, zoom out for a second, take a broad view of all the stuff that we're hearing, let's try not to lean too much into the hype, right, EVs are a real thing. They're going to happen. We're going to have mass adoption, but like, citing a little bit more toward our friends at Toyota, who again, have a little bit of a track record. They're saying, let's hold off. And I think that Mark is from Bosch like his his just real practical statement of saying like, hey, let's just think a little practically about it and say, What happens if we lose supply of Evie battery cells or lithium, like what does that actually going to do for us? And should we be considering the bigger picture? I have this sneaking suspicion that he is going to be historically correct in his warning? I hope not with too many bad consequences. So it is Thursday. And we're just we're just working here, right? You're in the stores, your company. You're just working there things to do. It's good to go. It's good to know things but it's much better to do things so good new things.

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