Greenland Machinery and the Future of Electric Industrial Vehicles

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Transcript:

Luke Renner: This is Advanced Autonomy, I'm Luke Renner. 

My guest today is Raymond Wang. Raymond is the chief executive officer of Greenland Technologies, which develops clean and sustainable machinery and technologies for the global industrial market. He joined the company in 2019 as CEO when Greenland went public on the Nasdaq as GTEC. Prior to joining Greenland, he has led roles in finance, third party logistics and emerging tech. Raymond is a graduate of Rutgers University and is based in New Jersey. He joins us today as a representative of Greenland, which recently announced a partnership with Simon to bring autonomous capabilities to their industrial vehicle fleet. 

Hi, Raymond. Welcome to the show.

Raymond Wang: Hello, Luke. It's a pleasure to be here.

Luke Renner: So tell me a little bit about Greenland. How long have you guys been in business? What do you build?

Raymond Wang: Absolutely. So Greenland Technologies, we actually started in 2006 by manufacturing drive trains and transmissions for the material handling market. And we've been extremely successful over the years to the point where we actually became the market leader in our space. We serve clients such as Toyota, Lindy, BYD, Hansa, just to name a few. 

And in 2019, we decided to continue to evolve the business and created a brand new division called Greenland Machinery that was focused on providing clean and sustainable alternatives to the industrial vehicle market, which is entirely dominated by heavy emission diesel systems.

Luke Renner: And you're talking about electric industrial vehicles, is that right?

Raymond Wang: That's right. These aren't the vehicles that are one time in total vehicle weight that you might see in front of a Home Depot. These are true industrial sized vehicles well suited for actual commercial and industrial applications. Our flagship vehicle that we launched is a Gel 1800. This is a 1.8 ton rated load, lithium-powered, all electric wheel front loader. This vehicle is about 14,000 lbs and it can run for 9 hours, with enough power to get the job done.

Luke Renner: I think a lot of our listeners would be surprised to learn that the transition to electrification and the rise of electric industrial vehicles more broadly is just happening now. So tell me a little bit about the opportunity that electric vehicles represent.

Raymond Wang: In the excavation and front loader industries, those actually represent about $80 billion in market value today at the global scale. And there is no electric alternative in this space today. And this is a solution that we're excited to provide to the world, not just to pioneer the trend of electrification in this space, but also be able to deliver value to not just our shareholders and our partners, but also our clients and to society as a whole to provide sustainable options to start the trend, moving towards cleaner options?

Luke Renner: Totally. And I think it's very clear that when a company makes the transition to electric vehicles, they are making an investment in an environmentally sustainable future. But of course, that isn't the only benefit to making that transition. So as you started working with your customers and end-users, what other benefits have started to accrue to them by making this investment in electric industrial vehicles?

Raymond Wang: So by going electric, this offers the user a significant amount of advantages that aren't available for diesel systems today. One of them is zero operating emissions. So if you're utilizing heavy equipment in indoor settings, particularly, let's say, for a barn raising livestock or for silos holding materials such as dirt or salt for snow removal or things of that nature, it's actually very hazardous to the operator and that local environment by producing heavy emission systems in this closed setting and then you'll get a significantly poor air quality that can harm the folks around it. 

So by producing zero admissions, it makes it perfect for these indoor onsite applications which makes it much safer for the operators in this industry and that's just one benefit there's also electric vehicles produce over 60% less sound than their diesel alternatives. So this makes it perfect for operation in sensitive areas such as urban settings near hospitals, schools, things of that nature. 

Even further is the simplicity for use. So let's say you are operating on site in a remote. To areas such as in a farm, in a farm, or at a mine, or some area that's very difficult to be able to procure diesel onto your site. You have to procure it, transport, store it just to keep your machinery going. But with electric vehicles, all you have to do is install smart charger where there's so many government incentives to make that easier to adapt, and once you have that infrastructure on your site, then the vehicles are plug and play. So you use the vehicle as you need to and then once you're done, you plug it in and it's ready to go the next time in 2 hours. 

And then the last piece as well is just the ease and reduced amount of maintenance that's required with an electric vehicle. Because it's not a combustion system. So you don't have to worry about filters, belts, spark plugs, things of this nature that add up, especially in the industrial vehicle market. So these savings then add to the benefits for that end-user to make sense, not just from an environmental standpoint, not just from an operational standpoint, but also from a bottom-line standpoint.

Luke Renner: You mentioned that electrification enables the indoor use of these vehicles. So is that to imply that they're just using diesel inside anyway and hoping for the best in terms of all of their workers breathing in the pollution?

Raymond Wang: Yes. Unfortunately. It is an issue that's getting greater scrutiny by both the Labor Department and by Ocean in particular to make sure that operator safety is still maintained in these harsh environments. So many new regulations are coming in that cap the amount of emissions that can be housed and concentrated in these indoor environments.

Luke Renner: I want to widen the scope a little bit. I know you're talking to end-users a lot in your business. I think the big challenges are challenges that a lot of companies are facing right now. Labor shortages, supply chain issues. Are there any other challenges that you've been seeing as you've been talking to end-users?

Raymond Wang: One of the challenges that we were anticipating is just embracing new technology. That's one thing that as a pioneer in this space is a challenge that we need to hold on our shoulders because especially in the heavy industrial equipment market, it's been powered by diesel for over a century. I mean, the only other power that came before diesel was steam power back in the 1900s. So we anticipated a challenge for folks to embrace the change. 

But one thing that we've been very pleasantly surprised about is that we've received a significant amount of openness towards embracing newer technologies going electric. They're open to the idea, but still, as part of this effort, we need to showcase that this new technology, this electric vehicle, does still have the power to get the job done that their diesel systems are doing today. So this is why it's very important for us here at Greenland to provide as many opportunities to our prospects and to our clients to get behind the wheel, operate the vehicles, move some material for them to get a good sense of what it can do.

Luke Renner: Yeah, that's really interesting. I think we have been seeing that a lot in our business, too, where we have been doing a lot of demos, showing off this autonomous vehicle technology. People really kind of want to take it for a spin and kick the tires and make sure that it's going to work smoothly with their business. Because in the case of autonomous vehicle technology and Cyngn, it's a little bit more complex. I think the change management needs to be a little bit, you have to be very thoughtful in order to shift that company culture over something that drives itself. But I imagine those kinds of challenges you're seeing in your business as well because any time you introduce something new, it's new, SOPs it's new protocols and it's a new way of doing business. And all of those things require the buy-in from leadership and managers in order to make that change as smooth as possible, right?

Raymond Wang: Yes, absolutely. And it's also, especially in the autonomous work for onsite applications such as warehousing that Cyngn is doing. I think it's so critical right now in the environment, the global environment that we're currently in where folks are just demanding next day logistics for a product that they buy to arrive at the door. In some cases same day as well.

And right now, essentially the demand for efficient logistics continues to go up like this, but the labor market is actually still coming down to be able to support that. Sorry, I can't do the hands on camera, but essentially the demand for logistics continues to rise and outpace the labor that is a backbone to support it. Which is why I see the autonomous solutions being developed by Cyngn and others, to be so critical and needed. And I think for logistics companies to succeed in tomorrow are going to be the ones that embrace and begin to adapt that technology.

Luke Renner: As you know, last month Greenland announced a partnership to bring autonomous vehicle technologies to forklifts and the other vehicles in your portfolio. So what can you tell us about that partnership and why did you seek out an autonomous vehicle technology provider like Cyngn?

Raymond Wang: I am so excited for our partnership together with Cyngn. I've spoken with the team many times and I am just blown away by the technology that Cyngn has been able to develop. And I'm extremely optimistic about the future applications. And especially with our electric platforms for our vehicles, from our lithium powered forklifts to the front loaders and excavators, the opportunities are just abundant on what we can do together. 

So I was very excited to partner together to be able to provide new and innovative solutions for our clientele, which I think will build value for both our companies and our shareholders as well. 

Because just as I mentioned before, especially for onsite warehouse applications or manufacturing applications, it's an inevitability. Folks to survive in the future environment need to begin to embrace autonomous solutions today, just to be able to meet that demand. I don't see the labor market just flicking overnight and just doubling to meet that demand. So these systems are requirements for the future, and we need to begin to explore them now to be able to provide them to potential clientele to adopt. So I'm super excited from that standpoint alone, even just for the current market.

But now from a future standpoint, what really makes me excited is for autonomous systems for our loaders, our excavators, and even future industrial equipment. Because this is an application, this is a system and technology that doesn't exist today, at all. No one has a solution for it. The closest would be Caterpillars remote operation for mining, which is great technology, but I think we can take it even a step further to be able to automate tasks today that are very challenging to perform because it's very difficult to find the labor to perform. 

Even a simple task such as operating a front loader to grab salt from a silo and put it into a dump truck for snow removal needs. This is a rather simple task, but municipalities and government agencies and waste management centers or transportation departments are having trouble finding the drivers to perform this task. But it's an onsite task that's very simple to develop a solution, especially with our electric loader equipment that we can automate and provide for the future.

And I think that is going to truly disrupt the industry, but also help to meet the needs and demands for the operators in this space that are having trouble, they're lagging behind right now. Today, even tasks as simple as waste removal, where we're having trouble finding the labor today just to meet the needs. Now we can shift people away from the yard, automate those situations and put them more for retrieval, which then would improve the quality of life for all the end-users. So these are changes and future opportunities that really excite me and it wouldn't be made possible without the partnership between Greenland and Cyngn. So I'm very excited for the future and what opportunities will present themselves.

Luke Renner: We kind of talk through the benefits that electrification will provide to end-users. But I was wondering if you could just widen the scope a little bit and talk about how shifting away from diesel-powered vehicles more broadly, what impact that's going to have kind of on our environment and the world more broadly?

Raymond Wang: The impacts of climate change and emissions into the environment and its impacts to human health is not something that can be ignored any further. And it's well accepted as fact that this is having an impact not just from an environmental standpoint, but then also on our society's health. And just recently, just last year, the American Lung Association updated their State of the Air report and indicated that here in the US, 40% of Americans are impacted and living in areas with poor air quality that has a material impact on their health. This is over 135 million people, and of that amount, over 25 million are children. And this is a statistic that we as Americans are looking to improve upon by adopting cleaner technologies. 

We are extremely proud to be leading that effort to provide these sustainable options in this space. And we are joining a crowd of many that are finding alternative and cleaner applications across the board. And this is something that as a society, we really need to improve the health and quality of life of our fellow neighbors and those around us. And it's not just here in the United States as well. This is a trend that's going on at the global scale, and it's really great to see.

Luke Renner: Yeah, I mean, I think that's totally true. But another thing that is also true is that a lot of the kind of an industrial heartland of America is still creating electricity using unsustainable sources. Right? So they can create coal-powered electricity and pump it into your electric vehicle. And that actually wouldn't contribute to solving the problem of climate change, would it?

Raymond Wang: So in the current environment today, no. So much of our power grid and source is based off of combustible systems like coal and fossil fuels as well. So if we were to just wipe these off the board tomorrow, our hospitals wouldn't run. A lot of the infrastructure would fail right away. It's not something that I want. However, what I do want is shifts and trends towards cleaner technology solutions.

It's a journey. It's not one simple snap of the wrist, one light switch and it just goes clean. It's a journey, but we need to start taking the steps towards the journey for a cleaner future tomorrow and for 2021, for power generation in the United States, over 90% of the new power plant generations being produced are actually off of renewable energy systems, like solar, like wind, like Hydro. And this is an important step for us to reduce our future dependency on these combustible systems to a cleaner overall infrastructure system. And that's the steps that we need to take.

It's going to be a journey.

It's going to take many different steps and everyone across the board, from power generation to procurement to vehicle application and even the end-user, all have to make these steps to embrace a cleaner tomorrow.