Hey, everybody. Welcome to Hammer Down, the show about why you, yes, you should consider a role in supply chain. I'm your host, Mike Bush, and this episode is super fun. It's a little different than most of the episodes we've done. So Volvo, who's been on the show in the past, is rolling out a new truck. It's called the VNL, and it's super slick. It's super cool. And as part of the celebration, they've invited members of the media, including me somehow, to their headquarters in Radford, Virginia. So throughout this episode, you'll see a couple of interviews with folks. You might see some of the production that's happening in their in their facilities. We actually got to put together a truck. You'll see some of that stuff. And you might, if you're lucky and pay very close attention, even get to see me crash a truck or at least try. Hope you enjoy the show. So, Magnus, we are here in Volvo's headquarters in Radford, Virginia. What's what's the story with this guy behind us? This is cool. And and and what you see here behind me is the new VNR series. We started production of this just a few weeks ago. Maybe the first units as we speak are reaching customer hands. So that is pretty cool. And it's the second truck on this new platform. The first one, the VNL series. It has been on the road now for roughly a year, a little bit over a year. So this is the second track on this new over two billion dollar investment we have made in in in in this new truck. So that's pretty cool. Understood. Walk me through the new bells and whistles. What are the things that a trucker would get excited about, Steve? No. When we talk about Volvo, and we started this project with a new platform of trucks roughly twenty eighteen. And then we said, okay, what do we want to achieve? Because you come to a point with a legacy model. We actually started that one nineteen ninety six. We have numerous iterations and so on. But you come to a point, okay, you can't do more on that platform. You need a new platform to take the next step. And what should that step be then? And then we discussed and we said safety, of course, Volvo is synonymous with safety. So you need to have all the safety features you can imagine. The objective was to do the safest truck in the world. Then what what's the our customers or or carriers, what's their biggest expenses? It's drivers, number one. Fuel is number two. So we said we need to address those. Yeah. And we want to build the most fuel efficient truck the world ever has seen. Very simple objective. We want it to be ten percent better than our legacy model. In order for us to do that, we knew that we need to change the cab and the body in white completely. So we started from a white sheet of paper and then how to optimize a truck for the best fuel. So and and what you see here and even more so on the VNLs here, so that's our long haul flagship, flagship, all the aerodynamic devices and the curb windshield, which is unbelievable. So everything is thought through. So you'd get the ten percent we claim for the VNL series, seven is from aerodynamics, three is from powertrain. For the VNR series, the VNR you see here, which is more regional track pickup delivery, more confined environment, fuel is important, but not as important. So this is seven point five percent better fuel than than the others, but still keeping the the same technology. So I would say fuel, yes. That that that's that's that's one. Now when you say fuel is not as important to a regional carrier, why do you why why do you It it doesn't drive that. So let's say a long haul can easily drive one hundred and twenty thousand miles a year, while maybe regional, maybe half. And, of course, if if you add that up, yeah, it's important, but not as important. And you have many stops and go. Lots of other things that that impact the fuel While the long haul tractor is designed to go mile after mile without stopping and most efficiency and most productive. It has the other thing, and that's important, Driver and and the the most expenses from from the carriers is is driver expensive. So we wanted to do the best possible interior environment for the driver. It shall be the best drivability, maneuverability, visibility, and you have tested both of these things today. I mean, if it's not on the podcast, did it even happen? ****. Home. I just wanna call out that it wasn't just me that hit a car, and I just watched Steve Banker from Forbes run one over. That name dropped him in Africa. Oh, yeah. That that that was for the podcast. Especially with the VNR with the short hood, the turning radius and the maneuverability, it's it's unbelievably. It's better than my car. So it's so so we want to do that, pair that with a driving environment in terms of layout, stalk, and also resting environment. And, you know, you can transfer. You have Murphy beds. You can transfer that dinette. So flexibility. So these were, I would say, the three key things we wanted to do. And I would say, I think it hit home. We see nowadays, and it's pretty fun to see. Now maybe not so much at this point of time, but go back a year in time. We had driver shortage. We see that carriers are advertising, come drive for us. We have the new Volvos. And we put lots of extra effort. We have more insulation. It's super quiet Yes. In in the cab. Super quiet. Lots more insulation. So lots of of thought went into the cab. We optimized the space inside because this cab is actually more narrow than than our legacy product because of you need want that wedge shape to give the aerodynamic. And then it's it's a trade off. Okay. How do we still make that little narrower truck feel spacious? We had so many tests, had so many clinics, you know, to move the seat one millimeter there, up. Now it's too much. We tested with drivers. Now it doesn't work. So lots of testing, several thousand of drivers in in involved in the development for us to really make sure, yep. Now we have it. You know, hey, Tony. When you talk about driverism expense, I hadn't thought about the retention side. Right? Yeah. But the drivers who drive Volvo, the drivers who drive you know, I I come from a background where where we had we had EVs and hydrogen trucks out there. My retention problems were never a problem. Our drivers loved them. You know? Yeah. So it's such a great call out. Like, it's it's such a hidden cost in the future. Absolutely. It's a massive cost. Massive cost. How much doesn't it take to train and educate a new driver? Of course. Absolutely. And, you know, it it's an industry with eighty five percent turnover year over year. So to say, hey. I I kept five extra drivers. Yeah. Huge. No. No. Exactly. And when we did this, the the turnover was over a hundred percent a year, which is crazy. So so that's what okay. We need to do that. Safety is a given. That's Volvo. We need to do the the best fuel and the the best best interior. And, yeah, here here you have the the evidences. Now when you start with a white sheet of paper, presumably, there's no such thing as a bad idea. Nope. Was the worst idea you heard? Somebody had to throw something at the wall, like like, oh, let's put a dartboard in there or something something that just couldn't resonate. I think in the beginning, designers are very creative people, and that's fine. And very first, no limits whatsoever. And then you come up with these very strange shapes and so yeah. But then, okay, that looks cool, but we need to be able to build it and industrialize it. Right. Everyone can do one prototype truck, and you can do that and so on. But to industrialize it, make sure everything fits, make sure it's cost efficient enough, so then all the compromises start to kick in. But I did see some very weird, I would say, early design concept. And that's fine. And then normally, we end up at three. So, okay. And then they present for us then in management and all the features with this concept. These are the pros. These are the cons. This and then we choose one concept. Many times, it's a combination of, yeah, let's say we take that concept, but we want to have a little bit of that. And that's then okay. Now we lock down the concept, and then the real work starts. How to package things? How to make sure everything fits? How to make sure everything will be cool? How to make sure we have place and space for all these cabinets and freezers, whatever you want in in the cab. So and then, of course, along we always have compromise. Yeah. But we have to do okay. But then we have a deliberate decision. But when I see the final products here last year and this year, I would say I'm pretty proud. The main objectives we set then back in eighteen and nineteen, where we really nailed down the product, we kept them. And I'm glad we did. And what better time now than talk about fuel? We we you know, yesterday was the the highest ever recorded diesel prices. So and tomorrow, we're gonna shatter that record. Yeah. So we're we're heading in the wrong direction there. But yeah. Yeah. So what is your background that got you to the point where you're in Volvo? Involved with Yeah. You you are. Good question. I have I started in Sweden in powertrain, actually, at the engine factory back in January of eighty nine. Okay. So it is a couple of years ago. It's a little while. It's a little while, so I know I'm way around. But back then, when I started, Cars and Truck was the same company, Volvo Cars and Volvo Truck. Then after a year, so I just had a one year temporary assignment. And you know, you're young. I was twenty two years old. So I think it's some work. So it's good. And then after one year, Volvo Cars and Volvo Trucks did go different ways. Obviously, someone someone told me, yeah, you did a decent job, and we can offer you a job at the on the car side and on the truck side. And most people that weren't saying, yeah. A car. That's much more fun. I I still can't remember to this day why I said trucks. But since that very day, and that was then January of nineteen ninety, I've always worked for Volvo trucks. I I've been around the globe working now now the last fifteen and a half years in in the US. Now, where's the coolest best you've been? Yeah. I've been all cool places I've seen. But I think what has to me the most gratifying thing, I've been able to travel the world job, meet so many different interesting people, culture, and Volvo is the most global brand. We are in one hundred and thirty plus countries, and I've been to many of them, meeting our customers, meeting our dealers, meeting our local companies. And you learn a lot from, you know, yeah, it is difference between US, Japan, Australia, and Angola. And you need to realize that also when you develop drugs because one size may not fit everyone. And I think that's good learning to be able to meet so many different people, to hear what's important. And, you know, just take an example now. It was many years since I was in India. But, you know, people is not a problem, and workforce is not a problem in India. Salaries is not a problem in India. Why should I have the most comfortable truck? And our customers, don't even care about the driver. Right. So and you come to this. Yeah. It's interesting. One memory, and this is pretty interesting, was in South Africa, and they claimed they want really high horsepower engine. I said, why do you want this high horsepower engine? You don't really need that. You're not hauling that heavy. But then I was told, when you're going through the mountains in certain areas of South Africa, if you don't have the power, you have pirates in the side of the road. If you go too slow, they jump up on your trailer, and no one has covered box trailers. They're just you know? So they they cut the load, steal the load if it's going too slow up the mountain. Gotcha. So then I need yeah. Yeah. That makes sense. Not of course. I would never have thought about that. That's why you want more horsepower because you have pirates in the side of the road. And and one interesting one is to about this truck. In Brazil, we had to do trucks that were covered, so there are no steps. So why why why are we doing that? Same story. Because if they go, anyone, you know, crime is is pretty bad there Yeah. Can come up and take the truck. So you have it, and you could, of course it had step, but this was inbuilt. So you need to activate them. Right. But, yeah, it makes sense when you tell me. But, yeah, I wouldn't have come up with that. Why don't I? So things like that. And I met so many, you know, so many stories like that through my years. So that's pretty interesting. Got it. So my favorite question to ask a guest on the show is if you're talking to a new or recent college grounds, and they say, Magnus, I'm thinking about supply chain. I'm thinking about logistics. I'm thinking about trucking. What's the one piece of advice you'd give that kid? I I think, yeah, first, you need to learn what area, and and you need to be a little bit clever what you choose. Now, of course, connectivity, software development, AI. These are, of course, things you need to consider or having in mind. And then what kind of jobs will be left, if I say like that. But I think you are safe in any of these areas. Software, always need and, you know, the software going into the development, it's unbelievable. It will just get more. It's like connectivity, what can you do? The AI, it has just started. We don't even know. We are using AI today for predictive stuff, connectivity, downloads of parameters, all that. So I think these are things I think you need to consider. So I think today, have even if you're not extremely interested, you need to consider these things, what jobs will really be available and what are most important regardless of industry, I would say. But if I see our industry, more technology, more high-tech, software, systems, AI. Of course, you need people that are building, developing stuff. But these kinds of things, I think, now is safe. And I would say a little bit, unfortunately, I think people need to think about that. When I was little and growing up, you didn't need to think about these things as a factor. You say, yeah, I think trucks are cool. I work for trucks. But many jobs, we will, for sure, will also disappear or be replaced different and we have automated, you know, many different things in our and you did see today actually in one of the plants. Robotics. You know, it's very you can't hardly see any people. Yeah. And robotics. Yep. So things like that and developing these I'm always so fashioned in going into that plan and see, who comes up with these, you know, ideas that the robot shall do all these things? That kind of competence is definitely something that that yeah. That that's future. Oh, I I couldn't agree more. It's you know, one of my favorite things when you when you talk to a mechanical engineering student. You say, what do you wanna do? I wanna build robots. Yeah. Well, cool. Have you been to a manufacturing plant? Yeah. Have you been to a port? No. Of course not. Well So those are the only two places robots are in production. What do you do? Like Yeah. And I think about that as that's not the kid's fault. That's our fault as a industry for not seeing. Here's the cool stuff. Like, we're we're here. It gets, and you can come see it and, you know, touch it. I guess there are a couple of robots that if you touch them, they They panic. But yeah. Yeah. It's interesting times. So Is there anything I haven't asked you or anything you wanna touch on that we haven't? No. I I think yeah. One thing that goes a little bit in line with with what we just talked about here, future autonomy. Yeah. And also in terms of of trucking. We are, as everyone else, we are doing testing. We are in Texas. We are driving separate lanes. We're actually hauling for customers today. The big Sasko was on a podcast a couple months ago. Okay. Yeah. Then you know all about it. And that's, of course, extremely interesting. Very. Extremely interesting. And that will come. And then you say, Yeah, you just talked about how important the driver is. And on the other side, you talk about autonomous and no drivers. What's the deal here? But it's a compliment. As a foreseeable yeah, still we haven't seen real commercialization of the autonomy, and it will come. But it will not be for everyone, not to start with. Probably the major companies, dedicated routes, as you probably know them from SASCO. But I think good complement to the driver for CEO, but I had ten years. We will still have predominantly drivers. But it will be a complement, especially in times, maybe not so much nowadays, but if you would ask me two years ago when we had, you know, hundred thousand drivers, lack of hundred thousand drivers in the industry. And if you think about that, yeah, a driver can drive eleven hours, then he need to rest for eleven hours or so. A truck can hypothetically run twenty four hours or or until it needs to fuel up. So I would say the productivity aspect productivity gains immense. So I would say lots of possibilities. Will it be for everyone? No. Will it come? Absolutely, yes. Then to what scale? We have ambition goals, and I'm sure Sasco talked to you about it. Will it happen as well? I don't know. But it will happen, and it will be a good complement. Yeah. I mean, it very much makes sense. I I am the the working theory that autonomous trucks are gonna, you know, really compete with rail, quite frankly. It will. I think it will take from from rail. These are modal things. Absolutely agree on Highways are the perfect use case. And then once you get into a city, a truck like this, when the turning radius is the perfect complement. Yeah. No. No. So so things will happen. The big question, how fast will it go? We all thought about when we we were first out in this market with an electric truck. Yep. And we put in nineteen, put in production twenty, and then we thought that trajectory will be yeah. That didn't happen. No. It turns it turns out you just have to elect a different president if you wanna have any any sort of decision. So and then it became politically everything, and then the market dies. We're still the the market leader. But, you know, if the total market is three hundred trials, it does better. So that we were very wrong when we were predicting and we had this trajectory. Yeah. We were wrong. Then for different reasons, Europe has taken off okay ish, I would say, not as much as we thought. We thought this market would probably be in the lead. It's not anymore. So I think that is something that we were wrong in our assumptions. We were early out. We put a truck on the road. We said we're gonna put a truck. We did put a truck on the road. We started production. Still a market leader. Yeah. The market is not there. Right? Right. And of course, lots of components. Yeah. You can say political also. But, you know, charging and infrastructure is not there. You know, total cost of ownership is not there. So it's lots of of things that that is but that that's an interesting To me, weight parity is the biggest job. Yeah. Yeah. Yeah. Mean, when when a truck weighs eleven thousand pounds in orbit, there's no potato chips and ping pong balls. You're absolutely right. I mean, why laser the perfect customer for the the Tesla subby? Because quite frankly, they weigh nothing. No. It made perfect sense. But Yeah. Exactly. No. So this is something we we were not right about in our predictions. Will it come? Yes. Yep. When? I don't know. I get it, man. Appreciate you being on the show. Thank you. Thank you so much for having me. My pleasure.
