Talking Michigan Transportation
The Talking Michigan Transportation podcast features conversations with transportation experts inside and outside MDOT and will touch on anything and everything related to mobility, including rail, transit and the development of connected and automated vehicles.
Talking Michigan Transportation
The week for electric vehicle news
On this week’s Talking Michigan Transportation podcast, analysis and takeaways on two major announcements related to the future of electric vehicles (EVs) and charging infrastructure.
Joann Muller, who writes the Axios Future of Mobility newsletter, discusses her coverage of an announcement from Ford Motor Co. on Monday, Aug. 11, billed ahead of time as the next "Model T moment."
As she wrote in her coverage, "The headline is that Ford will introduce a new family of EVs priced under $40,000 and will use a new manufacturing process to try to make them profitably."
In 2024, MDOT awarded a state Transportation Economic Development Fund (TEDF) grant to the Calhoun County Road Department (CCRD) for road improvements related to Ford Motor Co.'s BlueOval Battery Park that will improve safety, reduce congestion and support 1,700 new jobs and $2.5 billion of private investment in Emmett and Marshall townships.
Later, Muller discusses an announcement from the U.S. Department of Transportation (USDOT), also this week, about new guidance for the National Electric Vehicle Infrastructure (NEVI) program, which surprised many who feared a withdrawal of funding.
USDOT is reopening the spigot for federally funded EV chargers after freezing the program (created in the previous administration) for six months.
"If Congress is requiring the federal government to support charging stations, let's cut the waste and do it right," Transportation Secretary Sean Duffy said in a statement Tuesday, Aug. 12.
Hello, welcome to the Talking Michigan Transportation Podcast. I'm Jeff Cranson. You may have heard or read something about Ford making a new announcement, something they build as the next Model T announcement, in fact, about a new process they're going to pioneer to produce what would be lower cost electric vehicles. There's a Michigan connection, as this relates to a battery plant being built near Marshall. At the same time, earlier this week, the US Department of Transportation released new guidelines took some people by surprise for the National Electric Vehicle Infrastructure Program and what it's going to mean to the states that have been trying to build and establish a broader network of electric vehicle charging.
Jeff Cranson:So, I talked about all these things earlier with Joanne Muller, who writes the Axios Mobility newsletter and is a frequent guest on the podcast and just has tremendous insights into these things and really everything going on in the new mobility space. So, I hope you enjoy the conversation.
Jeff Cranson:Joanne Muller, thank you again for making a return visit to the podcast. It wasn't that long ago that I talked to you, but since we last talked a couple of big things have happened in the EV world and I really wanted to get your take on them because you follow this so closely. So thank you.
Joann Muller:Yeah, good to be here.
Jeff Cranson:So first let's talk about the big announcement, the Model T moment that Ford had built before CEO Jim Farley made his announcement in Louisville of all places. You said in your newsletter this week that you're still peeling back the layers, but you actually laid out some of the details. Give me your high-level takeaway.
Joann Muller:Well, my high-level takeaway is that Ford is trying to figure out how to compete on the global stage. In particular, you know, chinese car companies are the new, are the new benchmark, which you know. Who would have ever thought that 10 years ago? Right, but they have figured out how to make, in particular, make electric cars and plugin hybrid cars at a fraction of the cost that American carmakers do, and part of it's cheaper labor and part of it's, you know, they just control a lot of the supply chains. They're very vertically integrated.
Jeff Cranson:And flat out subsidized.
Joann Muller:Yeah, yeah, that too. They certainly have you know sort of national incentives for consumers to buy these products and to the companies that make them. So, you know, the problem is that China is so good that they're now expanding all over the world, and while they're not in the US yet, they're certainly in Mexico and they are right on our doorstep, and they are having, really causing a lot of pain to European car makers in Europe. So, the US is going to have to figure out how to fight this off right. And so, Ford has done something very interesting. They created this skunk works project in California, far away from Dearborn, and they hired people from Tesla and Rivian and other you know sort of outsiders to give them a clean sheet and say, hey, design a vehicle that can compete, that will be affordable, because, frankly, people can't afford to buy Fords anymore and Ford is as mainstream as they come right, like Chevrolet.
Joann Muller:So I give Ford a lot of credit for trying to do this right, but what they're trying to do is indeed really a monumental task.
Joann Muller:And so even Farley, the CEO, says you know, we don't know if this is going to go right, we have a lot to prove still, but here is our plan. They didn't even show the vehicle that they're going to make yet, but they did talk a lot about how it will be manufactured, and so they're designing a car for manufacturability which is, you know, a term you're going to hear a lot more about. Which is we've got to build these things simply, and we've got to take out all the complexity, and yet we can't strip down the vehicle itself, and so it requires fresh thinking, which is a lot of what, you know Henry Ford did way back in what was it 1913, I think, when he came up with the moving assembly line. He's like we gotta figure out how to make cars that our own employees can afford to buy. Yes, and it's the same concept right now. So that's my takeaway it is a big swing for the fences.
Jeff Cranson:Yeah, I mean, yeah, I was going to say roll of the dice, but swinging for the fences is a good way to put it too. So this relates a lot to overall transportation policy and how we're going to travel. I believe I could be wrong, but I believe that, despite administrations changing and some are more on board with EVs and other things related and some aren't that overall this is where we're going. It's just a matter of time, right, because of what China has already done. So if we're going to stay in the auto business, then this has to be the thing. Whether this is the right way to get there, as you say, farley himself acknowledges that this is a gamble, but I mean not that you have a crystal ball either, but whether this actually works out in the way that they're talking about or not. Evs aren't going away, are they?
Joann Muller:No, everybody will tell you. If you talk to anybody in the auto industry, they say, yes, electrification is where we're headed. So you know it's a question of speed. If you're Toyota, you know you're just piling out more and more hybrids, and that's a winning strategy. People are comfortable with hybrids now they are getting comfortable with plug-in hybrids, and it's a slow walk. But Americans will get to electric vehicles.
Joann Muller:Other parts of the world. You know, if you're in Norway, it's like 80% of all the cars are electric right. So the world is going that way. And we must never forget that this is a global industry and our companies, while they have pulled back a little bit globally, they do still compete outside of the US, and you just have to be in the game. You can't shield yourself off from what's happening in the rest of the industry, and I think that might be where there's some tension with the Trump policies. He's trying to protect the US carmakers, but in some ways, he's not helping by taking the pressure off of them to compete. So here is Ford putting pressure on itself, and you got to admire that.
Jeff Cranson:Yeah, it's possible to protect somebody to death, right. So I think that's a really interesting point you made about the incremental acceptance of things and what is human nature. I feel the way you just talked about that with EVs. I feel the same way about automated vehicles. If you ask people if they're ready for an automated vehicle, they'll say no, no, no. But if you ask them if they like auto braking or rear assist or lane assist, they'll say, yeah, those are good features, right. So that's how we get to acceptance.
Joann Muller:Yes, I have some different thoughts about that. Honestly, like I, I feel more comfortable riding in a robo taxi than I do in a car that is partially automated. And why do I say that? I say that because when it's only partially automated, there's a question of trust and misunderstanding about who's in charge at any moment in time. Is the driver in charge? Is the robot in charge? I was driving recently, test driving a car. It was a Mercedes. It has hands-free driving. I'm on I-94 on the east side of Detroit. I set the system, and I was only going a couple miles to, and I was going to be exiting, but I just wanted to see how it would handle that short distance.
Jeff Cranson:Well, it's not exactly a quiet segment of freeway.
Joann Muller:No, no, no, definitely not. But, what was interesting is that the car decided I had set the speed and the car decided to pass the car in front of me to the left, and I was expecting to exit on the right in a mile, and so once I got into the left lane I was like, oh no, now I have to get back into the right lane. The traffic's heavy. This was not something I, as the driver, would have done, and so I think there's going to be tension around that.
Jeff Cranson:That's interesting. I get what you're saying. I think I was thinking more about those other features besides auto driving, just the safety features. But I get what you're saying and I think when it comes to that hands-free, I've always thought that that's where Tesla probably made a mistake using the term autopilot out of the gate, because that does imply to people I take my hands off and walk around the plane, right.
Joann Muller:Yeah, absolutely. And it's even worse when they call their latest system full self-driving but then they put in parentheses supervised, so it's not really full self-driving, because it's supervised. Anyways, there is a difference. It's important for people to understand the difference between automatic safety features, which are the emergency braking and the lane keeping assist that you described, or the convenience features that I was talking about, which are advanced driving assistance and that's the hands-free, the lane changes, even adaptive cruise control. These are all things that are conveniences to relieve the stress and the burden of driving. You still have to pay attention for now. Someday, not in the too distant future, you'll be able to take your eyes off the road and your hands off the wheel. We're not there yet in the United States, but I just think it's very important to understand the difference between convenience and safety and not confuse the two.
Jeff Cranson:Yeah, and I'm a big fan of adaptive cruise control, in part because it regulates the distance, you know, between vehicles. Of course you know when somebody is not using it because they think that there's a little gap that you've created between you and the vehicle in front of you and they need to fill it in right.
Joann Muller:Right, but then your car will slow down even further and give that new car the distance that is required. So it is adaptive cruise control is a great feature. I agree with you on that, and it has been shown to reduce the incidence of rear end collisions.
Jeff Cranson:Yeah, absolutely, absolutely yeah. So I don't know if there's much more we want to say about Ford's announcement. I guess maybe beyond saying it's a swing for the fences moment, model T moment, saying that and then saying I don't know if this is going to work, I suppose at the time Henry Ford would have said I don't know if the Model T thing is going to work out. So that's fair. But to compare it to something that was so incredibly successful in the earliest days of auto manufacturing, you've really set expectations right.
Joann Muller:Yeah, yeah, exactly, you know I'm sure there's a little bit of a PR marketing approach there to get the attention to the announcement, but I think the things to take away from the Ford announcement one you know they're going to try to make cars a new way, but also they're trying to fill a hole that exists in the market for affordable electric vehicles, and that's the only way that EVs become mainstream is you have to find ways to sell them for $25,000, $30,000, which is, you know where an entry-level car is right now. And so I think that that is a really interesting effort, and it's as much about affordability as it is about kind of newfangled manufacturing.
Jeff Cranson:Yeah, and I'd say in this we'll get to our second topic, which is the EV charging network. But the two things that I think hold people back are, first, affordability. But second is, you know, range anxiety and that fear of being able to charge when you need to, which goes to why you've said before and said it again today that hybrids are actually. People are starting to get more comfortable with that and even plugging them in, but real quickly. I wanted to talk a little bit too, because this relates to some work that MDOT is doing in Marshall to accommodate the roads necessary for a plant that size. Talk about what this means to the battery plant Ford is building in Calhoun County and how that was not cut out of the big beautiful bill which everybody thought it might be.
Joann Muller:Yeah, it's so critical. Those batteries that are going to be made in Michigan, in Marshall, Michigan, are in fact the ones that are going to power these new $30,000 EVs from Ford and they, you know. So earlier this year I think it was in May, Bill Ford was up at the Mackinac Conference, and he said that this project was imperiled if Congress cut the production tax credit that Ford would be eligible for under some law that passed in the Biden administration. And they lobbied heavily for it and in the end Congress kept it in the bill and it probably was a bit of a surprise for a lot of people, but you know there was a lot of opposition in particular to that plant for political reasons, because the technology that Ford is using there they actually licensed from a Chinese battery company and the equipment is bought from a Chinese company and installed by a Chinese company, and the Chinese company's been present in Michigan to show Ford how to operate that plant. Now Ford will say, hey, this is our plant, this is our workers, these are Michigan people, there's no Chinese people benefiting from this tax credit.
Joann Muller:But it was extremely controversial and it made it through the bill and that's what's important to Ford, because now, uh, you know it. It at least helps the math on this investment, right? Because this is a $3 billion investment, um, and about a third of it they're going to get back in the form of this tax credit is what I'm estimating. So that's big money, and without it they can't make a $30,000 car, right? So, it is all part of the equation, and so there's a thing that I think is going to help Ford and help the US auto industry.
Jeff Cranson:Yeah, and if you want to be on dependence on the Chinese for this kind of thing, or really any foreign government, you've got to do this first, right. That's just the way it is.
Joann Muller:Yeah, you should remember this, right, 20 something years ago, when GM and the other automakers first went to China, what they saw was a market just emerging, people getting off of bicycles who wanted cars. Right, and they were very eager to get to China. And China said, ok, you can come here up, but you have to have a joint venture with our companies, and we get to have 51% and you have 49%. And the American carmakers were like yes, great, sign us up. We'll take that, we'll take that deal. And so, 20 years later, the Chinese took everything they could learn from US partners and then turned it around on them, and so that is why American carmakers are seeing their car sales just, and all Western carmakers are seeing their sales in China collapse, because the Chinese car makers are doing it better and they've taken everything we taught them.
Joann Muller:So, if you think about it, let's do that in reverse in the United States. Why not let the Chinese companies come here, but we get the 51 percent and they get the 49 and we'll learn from them on efficiency and supply chain and stuff. Well, you know, we'll never match labor costs from China. In the United States. The UAW commands big, you know big paychecks, but they deserve it, and that's the cost of living in the United States, right? So, anyways, I think there's a lot to play out on this US-Chinese auto industry dynamic.
Jeff Cranson:Well, yeah, and I mean the way that autoworkers were part of and helped build the middle class is why you don't have that in China and maybe never will, even while it shrinks in our country. Stick around. There's more to come, right after this short message.
MDOT Message:Avoid the wait and remember the Mackinac Bridge is closed to traffic Labor Day for the annual bridge walk, starting at 6.30 am. Spend some extra time in the UP or take your time heading north, since the bridge won't reopen to traffic until noon to allow walkers to clear the bridge. For more information, head to mackinacbridge. org/ walk.
Jeff Cranson:So let's talk a little bit about the related topic of the announcement this week from the US Department of Transportation that they were going to offer some new guidelines with the NEVI program, the National Electric Vehicle Infrastructure Program. Many of us thought it was on the ropes and were kind of taken by surprise. Did that surprise you?
Joann Muller:Yeah, it sure did so. Again, this is a program that was approved in the bipartisan infrastructure law back in 2021. And it was basically giving every state a bunch of money to install highway chargers. The idea was to really here to create the security blanket that people have when they're driving in an EV on the highway that they're not going to be stranded somewhere. Right, and there were. So, when President Trump came into office, he froze the program. You know, remember, a lot of the EV programs were put on hold or canceled, and this was one of them.
Joann Muller:The money had already been allocated by Congress and some of it was already given to states, but maybe states and certainly a lot of the chargers hadn't actually been built yet, and there's a lot of reasons for that.
Joann Muller:There's a lot of permitting delays and a lot of bureaucracy at the state level on how to manage these things, because states have never run electric vehicle chargers before. So lack of progress, lots of money, and so there was a lot of controversy and Trump put a hold on that for six months and, as you say, everyone assumed uh oh, that's the end of that program. But just this week, DOT said you know what, we don't like this program, but because Congress has allocated the money, we sort of have to spend it. So we're going to give you some new rules, and what they did, basically, was just give the states more flexibility on where they can put those chargers, and they also took away some language that was intended to lift up poor communities, disadvantaged communities, with more charging. And you know, I don't necessarily. I think equity is important, but I also know that where EVs are being sold, they're not the poorest neighborhoods, right, and so putting chargers in poor neighborhoods maybe doesn't make the best sense at this moment. Until we get more mainstream, maybe some of these lower-priced Ford EVs.
Jeff Cranson:but you raise a really good point that there are practical considerations and maybe the new guidelines are more practical and will allow for some streamlining of the processes, because it has taken a long time. And I'm glad that you pointed out in fairness that the DOT has been making it up as they go along, because this is something they haven't done before, and they didn't necessarily get a lot of guidance, and everybody was just trying to figure it out. It's been a real challenge. So, what do you think this means do ultimately you think this means Ultimately? I mean, if you combine Ford doubling down on their investment and belief that this is the future, along with the NEVI program that's all good for EVS right?
Joann Muller:Yeah, I think the progress with continue. You know there's going to be ups and downs, I think interesting because. I mean that because some of the consumer tax credits are going away at the end of September, I think there'll be a little bit of a rush to buy EVs over the next couple of months. There's also a lot of great deals on used EVs right now, but then maybe it's going to slow down a little bit. But it doesn't mean it's dead and I do think we'll continue slow progress toward electric vehicles.
Joann Muller:of cars already in the product pipeline for these companies. Those products are still coming for the most part. They might be delayed a year or two but they're still coming. So I do believe that electrification is still happening and I think the charging is a lot better. I don't know if I mentioned this to you recently, but I drove from Michigan to Maine this summer in an electric vehicle, a Rivian and I had absolutely no trouble charging. It was great. There was plenty of access to charging along the way, both you know, on the highway and some of the rural areas.
Jeff Cranson:Is that because you cut through Canada?
Joann Muller:Well, we, on the way home, we cut through Canada, and we also had charging available there. I mean it really, I will say this the big breakthrough was opening up the Tesla supercharger network to other brands yeah that was couldn't have been easier and you know the rest of the world should take, the rest of the industry should take lessons from Tesla, because they know how to how to do it.
Jeff Cranson:Well, yeah, and I mean they had a partnership with Meijer early on, you know, to put their charges in Meijer's parking, which was brilliant all the way around.
Jeff Cranson:It was brilliant on Tesla's part, it was brilliant on Meijer to say, hey, you're going to be here for a half hour or 40 minutes, you know, maybe do some shopping while you're here. So that was a win-win partnership. So give me your I guess your data points. What does your reporting tell you about loyalty? I know, anecdotally, I know people that have taken the EV plunge and love it say they'll never go back. Are we far enough along now to know about repeat buyers and that kind of customer loyalty that's built up? That's like I would never own an ICE vehicle again.
Joann Muller:I mean, yeah, I think that is. I think people, once they, once they drive an EV, they really they understand why it's so much more fun to drive and it's, you know, part of it is getting people to take the plunge and you have to have the right service and charging at home. Ideally. I don't have these figures near me right now, but Tesla has lost market share to other EV companies, other EV brands, and Chevrolet actually is the one that's taking a lot of those customers, and so there might be trading within EV segment. Certainly, Hyundai and Kia are two other ones that have grown a lot.
Joann Muller:Ford initially was doing well, but there's a lot of incentives, so that helps with sales of Ford's EVs. But you know, this next generation of EVs will be much better for Ford, I think. But the Lightning, the sales have gone down and the Mach-E, they're still doing pretty well. It's a lot of incentives. Same with GM, though. I mean, everybody's trying to keep these things moving. My point, I guess, is just that I personally find it very hard to drive an EV and then go back to a gas vehicle.
Joann Muller:It's just like you're driving a brick.
Jeff Cranson:That's what I hear. But I think the affordability is a real concern. I mean, what's it cost to drive a Lightning off the lot right now?
Joann Muller:I think they're around $60,000.
Jeff Cranson:Yeah, and I don't know what a Mach-E is.
Joann Muller:Now I actually I like he's around 40, but you know, again it depends. There are different trim levels and everything.
Jeff Cranson:Sure, sure, yeah, and I like it. I guess because I grew up in a muscle car age and I always liked a Mustang. So, I see the Mach-E and I like it. My son, on the other hand, looks at it and thinks like now that doesn't look so cool to me.
Joann Muller:Interesting, a generational thing. Who knows?
Jeff Cranson:It is generational. Well, Joann, thank you as always for your insights and for everything you do with your newsletter. It's a must read. If you follow mobility and if you live in Michigan, you should follow mobility Even if you don't work in the industry. Somehow your, your economy is tied to it, so I think everybody should know that.
Joann Muller:That's true. Well, good, Jeff, thanks so much. I appreciate being here.
Jeff Cranson:I'd like to thank you once more for tuning in to Talking Michigan Transportation. You can find show notes and more on Apple Podcasts or Buzzsprout. I also want to acknowledge the talented people who help make this a reality each week, starting with Randy Debler, who skillfully edits the audio, Jesse Ball, who proofs the content, Courtney Bates, who posts the podcast to various platforms, and Jackie Salinas, who transcribes the audio to make it accessible to all.