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John: Welcome to another edition of the Impact Podcast. I’m John Shegerian and this is a special double double double two for one edition of the Impact podcast. We’ve got Steve Kosowski with us and Alex Pawlowski with us. Steve is the manager of long-range planning and strategy, and Alex is the regulatory strategy specialist for Kia. To find them and their colleagues, you could go to www.kia, K-I-A.com. Welcome Steve and Alex to the Impact Podcast.

Steve Kosowski: Thank you, John. We’re really glad to be here. Thanks for the opportunity.

John: Well, this is truly a pleasure for me to have such two subject matter experts talking about some of the most important topics that we face today with one of the greatest and most important iconic automobile brands in the world. So, truly an honor to have you both on. Before we get talking about all the great things you guys are doing at Kia with your colleagues, can you share a little bit about your background? Steve, can you share a little bit about where you grew up and how you got on this journey? Then I’m going to turn it over to Alex to do the same.

Steve: Right, thanks, John. I’m from Chicago originally. I was into cars since I was just a little boy reading car magazines, going to the car shows, making car models since my earliest days. So there was an eight fascination there. I went to a school in Michigan called Northwood University. Northwood University’s renowned in the automobile business to learn about the industry. I was hired on by Honda when I graduated, moved to California and hopped around a little bit between Honda and Nissan and Mitsubishi and Kia. Principally in automotive market research and automotive product planning, advanced planning strategy had to do with portfolio planning, powertrain planning, things like that. In 2012 the head office in Seoul reached out and said, we want to start talking and working with you on EVs. Let’s work together and formulate a plan. We started with the Seoul EV for lots of reasons. The package and the market hit was pretty, at the time really receptive to the car. They really liked it, so we thought it would be the right direction to go. Then after that came the Niro-Hybrid and the Niro EV and the second-generation Niro EV. Around 2016 and 2017, we started talking about our first dedicated EV, which was the EV6. This is when you think about that car came to market in 2021 and around late 2015 and 2016 is when they started the platform development, all of the upfront engineering that went into that car. So we started engaging with R&D in Korea about what it is we wanted and why, and how much range and charging speed, charging time, macro-level trends that were influencing marketplace demand and that kind of thing. I worked on that. We brought that car to life in 2021 for ’22 model year. Then around 2019 started working on the EV9, which is our three-row EV SUV, which launched this year. Started with the upfront concept and the planning and the range and who’s the target buyer and things like that. Now, Alex and I work together principally on regulatory strategy, but our work is foundational and fundamental to the portfolio in terms of what kinds of EVs, how many hybrids. It’s very comprehensive and it shapes the direction of the powertrain strategy. So that’s a short history, John.

John: So you joined Kia with this mandate back in 2012, is that right?

Steve: Yeah, I actually joined in 2005, but 2012 is when we got the memo on creating the EV strategy.

John: I want to hear Alex’s background, but when were you two introduced and then became the dynamic duo of the strategy?

Alex Pawlowski : Yeah.

John: Alex, give your background and tell me when you and Steve got introduced and then became Batman and Robin of EV car electrification at Kia.

Alex: Yeah. Great to be with you, John. I grew up in Virginia Beach, coastal town in Virginia. I grew up around the water. My parents still live there. I grew up with a very innate sense of environment, and that’s something that’s always been driving me through school and eventually career. Eventually got my way to University of Virginia on my undergrad, doing engineering. During that time before all that happened, my mom as a highway engineer roadway designer, still does. My dad was a land surveyor, so transportation was always in the background growing up. I was that kid at five years old going through parking lots saying what every car was, et cetera, bikes, boats, cars, everything, all of it. Got to Virginia, did an engineering degree because I knew in high school that’s what I really wanted to do. Did a lot of sustainability projects while I was there. So I always had in my mind process that this juggernaut these two things really important to me. Made my way to graduate school in University of Tennessee, and did a program where I was at the Oakridge National Lab. So I was there about five years department of Energy Funding Lab. Did a lot of research in automotive as well as some material science, which is what I ultimately ended up finishing out with. Then jumped into the industry right as COVID hit. So, took a fun two year detour outside of the industry, worked in the DC area, worked a project in the Pentagon, worked a project for a data center, did some electrical engineering work, which I thought at the time wouldn’t be related to what I did. But come spring ’22 found a great opportunity. Steve was looking for someone to join him. Little did I know that some of all that work I had just done with transformers, electrical equipment and all this other stuff would be tied really into stuff that we do. So, I’ve been with Kia since summer of ’22 and work with Steve on a lot of regulation items, but also a lot of EV infrastructure planning, those kinds of things. We do a lot of work with our DC office with these different regulatory agencies, seeing some of the things and the challenges that we’re seeing, but also some of the opportunities and some other stuff that I’m sure we’ll get into.

John: That’s wonderful. I’m the furthest thing from an engineer. I’m a sales and marketing guy and an entrepreneur, but I’m very lucky because I have such an appreciation for what you both are doing. Some years back, I became business partners, and he sits on my board with JB Straubel, the co-founder of Tesla. Just to be around that kind of humble greatness, he is one of the most humble and genuinely brilliant human beings I’ve ever been around. I just have such an appreciation for what all of you that are leading this electrification of the automobile industry are doing, and how important it is to the future of the planet is just incredible. But it was a moment, I have to tell you, the first time I met with JB when I arrived, and he was picking me up from the airport, and he picked me up in a Tesla, I said, this is a little bit like a pinch myself moment with the co-founder of Tesla in the Tesla. That was [inaudible] for me. But yeah, it is. He’s a especial human being and what you guys are doing, especially. So this episode is really important, and as most of my listeners and viewers know, the Koo family are my business partners and investors since 2008 from South Korea. So I’ve been in South Korea four to six times every year since 2008, and Korean innovation and the dedication to innovation and staying ahead is second to none. I’ve gotten such appreciation for that over the years. So to have Kia on with you guys is, again, a double whammy for me. But let’s get into the macro. Kia is this wonderful large brand for our listeners and viewers, just to understand a little bit. Annual revenues over 77 billion. There’s over 51,000 employees, and you guys serve over 172 countries around the world. Talk a little bit about your macro electrification goals and what your EV lineup looks like today in 2024.

Steve: Great. Well, John, I think one important backdrop is the thrust from leadership to decarbonize the machine that makes the machine and decarbonize the products that we offer for lots of reasons. As Alex was citing and a lot of folks within our company who are working on all this, myself included, is the concern for the environment. At the highest level, the chairman yes, Chung has set a target as 2045 to be net zero. So the factories around the world, the offices around the world, the supply chain, the logistics, everything is being re-engineered to enable that. Then concurrently, the product lines in the United States, Europe, other markets around the world are being similarly engineered to be decarbonized. This means more and more electrification, more hybrids, more plugin hybrids, more battery electric and a lot of other cool things. As Alex noted, we’re at the tip of the spear of that. The US market is maybe the most important market for Kia at the moment. Europe is important, so is the Korean domestic market, but we are a really important market. So the products we offer are only going to become more and more electrified in the future. Currently, in 2024, we have four hybrids and three EVs, and three plugin hybrids, which we’re very proud of, and they’re doing very well. If you look at the sales volumes and the share of the market and things like that, it’s doing very well. We actually need to get more hybrid vehicles we’re working on. Same with plugin hybrids. So at the moment you can get a Niro-Hybrid for about 26,900, 53 miles per gallon, lots of utility, looks great, lots of tech, really refined and quiet. We have a Sportage hybrid. That’s I think, 28,000. We have a Sorrento hybrid for 38,000. So the attainable hybrids in the Kia lineup are compelling, to say the least. Then on the electric side, we have a Niro EV, it’s available for 39,000, goes 253 miles the EV6 310 miles for 42,000, and then the three row EV, SUV EV, which is the EV9 for 549, 304 miles. So what we’re really trying to do, John, is target the US core buyers with products that you want a hybrid, we got it for you, you want an EV, we got it for you at attainable price points. So that’s the macro-level view. Alex, if I miss something please let me know. Chime in.

John: Alex, talk a little bit about what Steve just said. It sounds like if you deliver in the EV marketplace a high-quality innovative product that really delights your customer base at an affordable price, that’s where the magic happens. It’s converging affordability with innovation and quality. Is that convergence where you and Steve look to aim and get your Kia cars and automobiles to?

Alex: Yeah, absolutely. I think the past 10 years people in the US have gotten to really know the Kia brand on a surgeon path as both delivering at the price points that customers are looking for in the market while having great quality and great features. So it’s a continuation of that effort. Since our rebrand in 2020, just further aspects of doing that and really delivering for customers. So, Steve touched on our current markets. We know globally, we have new vehicles that are coming that we know that are coming as well here, the US and that’s what we’re trying to aim for. So Steve, touched on EV6, EV9, our next generation that has started sale in the Korea market in Europe, EV3, that’s an affordable crossover targeting 35,000 MSRP, delivering over 300 miles of range. We’re really looking forward to where customers have told us through this process that I really like this vehicle, my next purchase for my other vehicle I’m really looking for something closer to the price point that I’ve been buying my other vehicles. Kia, we’re really trying to help eat away at that green premium that’s been here in the past. We’re doing that with both really nice expressive designs, interiors, et cetera, that go to our customer. But also looking at how can we leverage some of the advancements that we’re doing now and carry those forward to help keep getting down the price ladder for our customers.

John: A couple of questions. Since you operate in so many countries, where do you test, when you’ve come up with another great affordable Kia brand, EV car, automobile, where do you test it? Do you typically test that in California? Do you test it in South Korea first, or is it tested in Germany? Where do you do testing before you roll out at scale some of your newest and best innovations?

Steve: Yeah, John, very important point. In order to keep the quality right, you have to test around the world. So the short answer is we test everywhere. The first cool thing is the R&D center in Namyang in Korea is designed to enable real-world tests on the test track there, but also simulated test tracks, and they have hot and cold chambers. It’s been cool to go over there and see. I’ll never forget, we saw it was like 2012 or ’13, and we went to one part of the R&D center, and they had a Tesla in a hot chamber that was simulating driving through Arizona on 112-degree day, which I thought was pretty cool right there. They can do the same with the cold chamber, but the real-world tests get done, for example, coal tests get done in Swedish, Lapland, International Falls, Minnesota, where it’s minus 10, minus 15, that kind of thing. Then also here in the United States, in our Mojave, California test center and also on the streets of California you might see some pictures now and again. In Europe, they have another R&D center over there that they use, but they also test on the Nurburgring, which is important. This is really useful for developing and tuning the chassis dynamics and how the car feels. Then of course in South Korea as well, at the R&D center in Namyang, as I mentioned.

John: When you’re moving people over, Alex to buy your great automobiles, do you typically find it’s easier to get a new Kia buyer already who’s had an EV, or are they coming from the old gas models to Kia? Do you have a profile on a new Kia buyer that you’re starting to understand more and more of?

Alex: Yeah, absolutely. It’s a mix of both. Getting to that and Steve focuses a lot on this aspect of who are our conquests buyers. Steve, you want to give them a little taste?

Steve: Yeah. John, this is another important point. As Alex said, it’s a little of both. One is, it’s probably about if you look at the Kia EVs in aggregate and you look who’s trading and where they come from, it’s about 60 to 70% are conquest buyers, new buyers to the Kia brand. We see the trade-ins from all over the place. Tesla Model Y, Model 3, other electrified offerings like Nissan Leaf or Ford Mach-E, that kind of thing. But we also have a fair number of Kia EVs owners who’ve been with us for quite a while. For example, a Niro EV that’s being traded in on an EV6 and that kind of thing. So we like to feel pretty good about conquesting competitive brands because It’s a signal of the world-class quality and the competency of the cars. But we also like to keep our owners in the family.

John: Got it. You have an ambitious goal. Kia has an ambitious goal of having 60% of its sales come from electrified vehicles within the next five to six years. Explain this, it sounds like a huge goal and if it is, what’s the challenges and what keeps you guys up at night to achieve that highly penetrative model?

Steve: So this is another important point, John because Alex and I work very closely with the product planners who are planning these cars and our leadership on what is the prescription that aligns with market preferences, that aligns with regulations, that aligns with initiatives from our senior leadership. We definitely feel it in the market firstly, I’ll answer your questions, but the proportion of the market that’s becoming more and more electrified it’s almost increasing 50% annually. This is all in, this is hybrids and plugin hybrids and EVs. So our pace is also on that same vector. So we are confident that the expansion of hybrid offerings in Kia’s lineup. We have four right now. There’s going to be more in the future by the end of the decade, probably everything, almost everything in the lineup will be offered in a hybrid, definitely some electrified form. Again, this lineup with our initiative is to reduce carbon to improve fuel economy, to do the right thing for the climate in the world. So we’ll be looking for more hybrid offerings and higher volumes. We’ll be looking for more EV offerings. Alex touched on this with the EV3 and the EV4 so that by the end of the decade, we’ll have multiple EVs up and down the price ladder. So collectively between the hybrids and PHEVs and EVs will be probably north of 60% by the end of the decade.

John: Wow, that’s incredible. Talk a little bit about there’s not a day that we wake up now and either read a major publication, the New York Times, the Wall Street Journal or watch Bloomberg or CNBC, we don’t hear about this hype cycle that we’re in the middle of called AI. Is AI going to play a role in your design and planning and a data meta-analysis for your strategic planning for Kia’s years to come and how you approach both designing, building, and launching your new vehicles?

Steve: Yes, and yes and yes and yes. It already is, John. The ability for AI to integrate with all of those disciplines is astounding. All of that stuff that you read in here is true. It’s unbelievable what it can do for design in terms of listening or interpreting what it is, the stimulus you give it and what it can feed back. Concurrently on the engineering and development side, it’s also making a huge impact on speed to market. In fact, this company is known for speed. You can almost say there’s Kia speed, it’s very agile, and the company is constantly refining its development process, and it’s able to take chunks of time out of the development process, and AI is a big part of that. Alex is so sharp, and I would defer to him on some of these kinds of topics because I know he gets into it. Alex, if you want to comment on what you’re seeing and hearing.

Alex: Yeah, I also will take it a different way. One of the other things too is that AI is also adding a lot of data centers. You see that more and more. So see how one of the challenges that we have in electrification is when it comes to the doorstep of adding infrastructure and charging, we’re also a little bit in competition with those data centers of getting both access to the grid as well as transformers. So it’s both an asset and that’s going to help a lot of things get better, but it’s also in the short term also a battle that we have as well which has been fascinating.

John: Got it. Since you’re our resident AI expert on this interview, Alex, give us a little bit of where we are. We’re just finished up the World Series here. If AI was a baseball game and the hype cycle’s going to end but the trend will continue, are we at the bottom of the first inning? Are we on our way to the stadium and the game hasn’t even started yet? Or are we in the top of the fifth? Where are we in this AI generation? Do people even know what’s in store and how many benefits that will be able to derive from this AI generation?

Alex: Yeah, I think somewhere top of fourth, top of the fifth, I think. I think we’ve had a couple of small cycles of a lot of hype, then a little bit disillusioned, and then we hit the next threshold. I think one of the biggest things is we’re also thinking a lot in terms of Kia, about not only how we’re doing our process, but also can we have that offering for customers. As I mentioned earlier, EV3 launched in Korea, in Europe market. That vehicle was actually our first application of a ChatGPT-based audio command. So again, Kia has had an audio assistant for probably over 10 years in our products that we have offered. But now we’re looking at how do we make that communication pattern more natural, less menu focused of how you send the command, but actually have a conversation with your car and the car provide you answer, maybe access menus, et cetera, that are deep in how we normally would cluster things. We’re really seeing that opportunity to provide it to customers, but also do it in such a way that it’s not overwhelming or too far ahead of what our customers are looking for. Like with any hype cycle, we definitely have some moments where is that really the best use of AI? Is it AI just to be AI? So we’re focused a lot on our customer experience of what could customers benefit from. Like any innovative company, we’re always toying with that, providing something that a customer could find use of but isn’t asking for versus sticking to what are our customers looking for? How can we best respond?

John: This is no derogation on any automobile company, but I’ve been in automobiles that I’ve owned even myself, that sometimes seem over-engineered for what it needs to do. Sometimes the over-engineering can frustrate the client who’s a little bit overwhelmed with everything that’s going on and maybe my age group, 62, not ready to take advantage of all those great things. Talk about AI, though. You make a great point, Alex. AI, forward-facing for client benefit and use for things that they’re excited about, but also AI for helping design, build, and strategically plan out how you do things inside operationally. Where is it being leveraged more or is it a toggle and a tie and back and forth high wire act that you and Steve get to manage?

Alex: Yeah, I think a lot of things that Steve and I see a lot of is probably more on the customer-facing side [crosstalk] as you start to think about how customers could have a great use for it. I think internally, a lot of it is now in the investigation phase. We have a lot of processes that are already automated in a lot of ways that sometimes I think it’s overlooked by the rush to AI, is that there’s a lot of things that you wouldn’t really say call AI, but already are doing a lot of process improvements, et cetera, to do. So it is definitely a push and pull on that. I would say on terms of manufacturing and other items, I think we’re still in that testing phase of what gives us a rural process improvement over some of our already highly developed ways of doing things.

John: That makes sense. Steve, I want to go back to what you were talking about in terms of launches. Now, launches are done on a cross-continental basis because they have to be testing and launches US South Korea, parts of Europe. Talk a little bit about the challenges of launching new products and services in a world where regulations are only increasing and unfortunately are not yet harmonized which would benefit not only Kia, but other great iconic brands like Kia. So people get out of having to serve the regulator business and get to stay in the innovation and serving their client basis. How do you balance the harmonization or lack thereof right now? The patchwork quilt of regulations and the goals of serving your clients with the consistent and steady innovative and great product that you always strive to do.

Steve: Yeah, John, I think if you had some of the R&D chiefs on the call, that might be one of their biggest frustrations because as you said earlier in our conversation, we serve 172 countries, which is multiple regulations, different kinds of tax regimes, fuel, safety, and on and on and on, currency. So it is extraordinarily complex from the head office in Korea to manage this. Alex and I have been in some conferences talking about this. Imagine being the CEO of a company like Kia where you’re serving 172 different countries, you got to deal with labor, currency, supply, lots of disruptions around the world, navigate through COVID and on and on and on. It’s not easy. If I can make one point here, this is an interesting perspective that we talk about in product planning is it isn’t easy, but it’s the love and fascination with cars, and it’s the intent to make a difference for the climate and our customers that in many instances gives you the tailwind to stay here late, work late, work hard, get stuff done, and be passionate about an argument you need for something. But to answer your question a little more deeply, one common thread between probably the majority of these markets, be it Europe or China or South Korea or the US, North America and other markets is electrification. So the demand in North America for hybrids, the demand in Europe for hybrids and so forth around the world is the common thread that a little bit simplifies this complexity with regulation. So around the world, the regulatory structures are looking for less and less and less and less carbon. That’s a helpful foundation if you’re a chief engineer for the Niro or the EV6 or something like that. One more point, and then I’ll shut up is the technology that goes in the cars. So Kia is very proud to have class leading cutting edge motor design and inverter design all in-house and then great partnerships with battery suppliers like SK On, like LG and so forth. We all work collectively on these common topics, common initiatives. The one thing when you’re in Korea, and maybe again as an R&D chief, is you’re looking to simplify. Do we really need gasoline hybrid plugin, hybrid EV, maybe diesels. So you start to look at, well, we can get away with more hybrids and less of this and that kind of thing. So it really all comes down to, look, you all have the same end goal by 2030, you’re going to be selling 60 or 70% or more of your fleet as electrified. Let’s all focus on that, forget about some of the other products and that kind of thing. Actually, one example of that is we used to sell the Rio in the United States, but we don’t anymore, and we’re refocusing the portfolio. The Hybrid Carnival, which just went on sale in the US is selling like gangbusters in Korea and so forth. As you simplify our efforts globally, these kinds of things emerge as the tactics and the strategies to do that.

John: Got it. Given that South Korea is a small country geographically speaking, and because of my unique partnership with the Koo family and LS MnM family which is the Koo family and the smelting industry over there, what I’ve learned is Korea and Japan, smaller countries around the world, Germany, UK, Spain were much more ahead of us in the United States with regards to the sustainability revolution, the circular economy revolution. Since that’s part of the DNA of South Korea and then that, of course, affects the leaders of these great companies such as Kia. Talk a little bit about not only making innovative and great and affordable products for your clients to enjoy and use around the world, but talk a little bit about this new trend now in the United States, a new trend, but the OEM’s new trend of adopting design for sustainability divisions and creating more circular automobiles. Where does Kia fall on that and how do you feel about Kia’s circular input into the vehicles before they even hit the marketplace?

Steve: Yeah. John, really important point. Alex, I see you turn your mic off, but we’ll both chime in. I’ll give a little backdrop and we can get into some details. [Crosstalk] But I think one thing you made a point about maybe Asian companies, Asian car companies that seem innately more mindful of resources, and I think that’s a key factor.

Alex: Well said.

Steve: For lots of reasons but in the United States the mindset’s a little different. It’s a geographically huge country. We like to think we’re resource-rich, and we are, we have lots and lots and lots to draw from, but I think in Japan, in Korea they’re more mindful of efficiency and so forth. Even within our own company, there are some principles that relate to diligence, efficiency, harmony and things like that. So it almost feels like from the very beginning, the origin of the country, this has been on the front burner for us and that kind of thing. But Alex, do you want to comment a little more?

Alex: Yeah, I was going to say in 2020, Kia globally, signed a memorandum with ocean cleanup. Cleanup a thing that I personally really invested in, really enjoy and then that’s starting to bear fruit. That program launched by a kid with a dream in the Netherlands and has expanded now to a very large company doing a lot of important work in a lot of different sites, including even here in California. I spoke of EV3, one of the exciting parts of that partnership now four years later is now we’re starting to look at how do some of those plastics come out that companies are actively removing from the ocean, how can that be reused and recycled into a product that Kia sells. That’s something that’s working very heavily on. Recently announced a format related to that source. There’s also some cool sustainability features that that vehicle is showing, as well as other vehicles that we already have on sale here in the US on increasing recycled content, providing the backup of where does it actually come from providing that background information. One of the cool features that journalists in Europe are finding with EV3 is that there are now little QR codes in different parts of the car where you can learn more about [crosstalk] source of where those come from.

John: Yeah, that’s awesome. So the transparency that Kia gives is on the cutting edge, like you said.

Alex: That’s right.

John: For our listeners and viewers who’ve just joined us, we’ve got Steve Kowski with us, and Alex Pawlowski with us today from Kia. To find them and all the great work that them and their colleagues are doing at Kia. Please go to www.kia.com. One of the great challenges in the entire electrification ecosystem that affects all EV car manufacturers and the people out there that want to make the world a cooler and better place, but are afraid because of this terminology called range anxiety. Talk a little bit about what Kia is doing in terms of creating and designing and building and creating automobiles that will help allow their clients and potential clients to get over range anxiety, including the important topic of high-speed chargers, which just doesn’t seem like yet the infrastructure has caught up with the demand. Where does Kia play a role in both of those issues to help overcome the challenge and the worry of range anxiety?

Steve: Well, a couple of things. One is we really advocate EV owners to charge at home overnight using a 240-volt level two charger. We make that charger available on kia.com, or you can get it through the dealer. It’s a ChargePoint flex. We also have a partnership with Qmerit which is the largest EV charger installer in the US. If you need to get it installed, they can handle it. So we like to approach charging from a three-pronged approach, which is home charging and then public DC charging on Electrify America or EVgo and soon on the Tesla superchargers. Then mobile chargers where we have a relationship with Ampure to provide a mobile charger as an accessory, or in some cases eventually as standard equipment. So that should keep your charging covered. The other part of it is one of the things we thought years ago was important was high-speed charging. People don’t have time. Seoul’s a very fast-paced city, and time is important and it’s important for us here in the US. So the ability to recharge your car in about 20 minutes or 25 minutes is ever more important. The engineering that’s gone into EV6 and EV9 avails that to customers through very high voltage systems, 800-volt architectures, and a lot of other factors inside the cells, the cell design, the thermal management, and the battery management, that kind of thing. But the point is in the world of charging and range anxiety, this is really important because it gives Kia an advantage and gives Kia owners an advantage in that they can charge their cars very quickly. But on the topic of range anxiety, one of the things we notice, John, is if you go to the market broadly and say, well, hey, how many miles a range do you need? Well, first off, do you own EV? No. Well, how many miles a range do you need? Well, I think I need 420 or 450 because that’s what my gasoline car says. But if you go to people who own an EV already and say, how many miles a range? 250, 300 is okay. Because they charge frequently a couple of times a week at home, that kind of thing, or at work. So the fact is a 300-mile EV is more than enough. That’s part of it and the other part of it is the proliferation of EV chargers. One of the things that Alex has become expert on is understanding that vector in the US market of what does the EV charging landscape look like, and how is it growing? Are we getting better? And things like that. I think the answer to all those questions is yes, and yes, and yes, there’s more chargers every day. I think, Alex, you said just a couple days ago, the US crept over 200,000 US chargers. So with that backdrop, I would defer to Alex to talk a little more about range anxiety and how chargers and charging fits into that. You want to talk on that, Alex?

Alex: Yeah. So for us, one thing I like to think about is for new customers, the range anxiety question is still something that we hear a lot of. What we see as he’s mentioned is it is starting to transform to charger anxiety. So the will it work? My experience there especially if you’re a new customer, I’ve heard of these stories, I haven’t done it myself yet, et cetera, but we’ve seen that a lot of progress has been made even in the last two years related to that. So what’s happening? So one you have a federal, so bipartisan infrastructure law created the NEVI program, National Electric Vehicle Infrastructure Program. To date, that has states award, federal government gives money. States have awarded what’s probably going to be over 4,000 ports so far to date, 20 stations are open today. So a little bit over 115 ports available through the program, and probably another 30 are going to be online by the end of the year. So in construction right now, getting ready to be energized. But what’s important is while NEVI from the State’s perspective is relatively, maybe a slower rollout than we in the industry are ready to do, what it has done is it’s created a lot of bare minimums, like a new level of minimums that are needed. We’ve seen the industry respond. So during that time, a lot of private infrastructure has also come in during that time to raise a number to 200,000. This is higher speeds again, something that Kia customers can take advantage of. But also related to reliability, the phrase uptime has become a very big thing in the past two years. So really quantifying a lot of what’s going on, and I do have to give a nod to the joint office energy and transportation that got created by the NEVI program. They’re doing a lot of work with a lot of the Department of Energy Laboratories around the US to get really science down to the problem. What’s the most common issues for chargers? What are some of the ways that that’s happening, and what are the ways that we can fix that? Since then even though that’s starting to just roll out, we’ve seen a lot of networks really pick up the pace. One thing that we did last year was Kia, we invested in Ayana with seven other OEMs. That has a goal of getting to many, many chargers by 2030. They’re actually starting work getting ready to energize here in a couple weeks. A chargery, one of their places to fill up and charge in Apex, North Carolina. Really excited about that. It’s also bringing in a lot of manufacturers that have had European experience where Europe is further ahead and having a lot of charging. So we’ve seen companies like Alpatronic now set up in North Carolina and started to produce chargers. So we’re really excited that a lot of new entrants are coming in that have been there, done that in Europe, and are now raising the game here in the US.

John: Uptime. How do you officially define uptime?

Alex: Yeah, uptime essentially is how long is the charger available versus when it’s not.

John: Understood.

Alex: The federal program basically set a minimum of what can you discount from that but very minimally, how is this available? So there are a lot of great organizations out there. We reference a lot LA-based charger help. They had a really great report this year of showing that some charger companies haven’t been living up to the level of high standard that we want to see. But even while in that same report, they’ve also seen that the progress has been made in doing so.

John: If you don’t know this answer, that’s absolutely fine, but I’m fascinated by this. Approximately how many EV chargers are there now in the United States, and how is that slated to grow? What’s that hockey stick look like and that Delta look like the next five years?

Alex: Yeah, as Steve said US hit the 200,000 mark last week.

John: Wow, okay.

Alex: National Renewable Energy Lab put together a report for what’s going to be needed by 2030, and it’s going to get to a million chargers to be able to support that.

John: So we’ll go up about five times in the next five years.

Alex: That’s right. [Crosstalk] We have some belief that can happen. We’ve seen since ’21, ’22 that number basically doubled in that time process. So between some of the NEVI funds, which again, is a small down payment, but a lot of the funds that it’s helping to leverage and increase, we’re seeing a lot of private investments, including Ayana, be some of the ones that are going to help us get to that point.

John: That’s great. What keeps you guys up at night? You’re doing great. Kia is obviously one of the leading brands in electrification around the world, and you’ve got a good thing going, but what challenges do you guys face to continue this great growth, to continue your market, leadership, penetration, and lofty goals that you have at 60%? What’s some of your biggest challenges that you’d like to talk about? Because it’s fascinating to understand also not only how good the sausages taste, but how the sausages are made a little bit.

Steve: Yeah. John, there’s lots and lots to keep us up. I think the one thing that is on everybody’s mind is cost. Because we know there’s appetite in the market for lower and lower price electrified vehicles, be it hybrid or especially EVs and extracting the cost out of the parts of the car, principally the battery is really tough. As I mentioned, we have high level initiatives from our leaders to sell more and more hybrids and EVs and so forth. We’re over here saying, yeah, but boss, the cost is still high. It’s not easy. But we have some really smart engineers in Korea and the United States who are working on this, working with companies like LG and SK and others to work together to take cost out of the structure, take cost out of the system using AI to bring things to market more quickly. So I think for me, laying there at midnight going, my Lord, what are we going to do here? But it’s getting down to battery cost. The other part that’s an overlay on that is the Inflation Reduction Act. Alex mentioned NEVI, but the other big governmental support comes from the Inflation Reduction Act, which rewards US production of batteries. This is the challenge, John, is we’re pivoting from lower cost parts of the world to supply battery elements to other parts, for example, instead of from China, we’re going to Australia, or maybe Indonesia, even the United States, Alex referenced Arkansas, and there’s other parts that supply lithium in Nevada and so forth. But to bring that to market at the right cost to enable the right prices, is not easy. So what I feel like ultimately is that we have really strong, really good products right now over the horizon a little bit. There’s a couple of cars that are going to move down market in terms of price are going to get you more range, but by the end of the decade I think this wonderful combination of next-generation EV technology, this prolific EV charging infrastructure that Alex talked about by like 2028, 2029 I think these headwinds that we’re feeling might actually turn into tailwinds, honestly.

John: So great. That’s really exciting. I have an OG you guys, you’ve been there since 2005 or so. Steve, Alex sort of a new gee, he’s been there for two or three years. Talk a little bit about combined aspirations for the years ahead. Obviously, this is one of the most exciting times to be doing what you’re doing because it’s not just innovators innovating anymore and hoping, crossing your fingers that the marketplace will love you. The marketplace is loving you, and it’s loving you for good reason. Because no matter where people are with regards to their science, backgrounds, and things and such, climate change is irrefutable. There’s not a day we look at the news and we see another climate disaster. These things weren’t happening at the velocity or at the size that these are happening now. Tell me a little bit about the excitement of being in a world that shifts from the linear to circular economy, that wants sustainable practices, that wants to cool off the planet and electrify the planet and get away from carbon fuel. Talk a little bit about being at the ground zero for all of that and where you could take it in the next couple pf years ahead. How excited are you guys and what keeps you guys inspired on a regular basis?

Steve: I think firstly, it is really cool opportunity to be able to work with our leadership and I think some of the best engineers in the world in Korea, in North America with this company. These guys have the same motivation, John, that you feel, and that Alex feels. They’re making a difference, they want to make more of a difference, and they’ve been exceptional at bringing these cars to market that use less petroleum in the interior, using recycled plastics from the ocean. I’ll put it like this, we have steadily been decreasing our carbon footprint as a portfolio, and we’re going to be bringing more cars to market and higher volumes that emit less CO2, that consume less petroleum in the interior and give a better driving experience and consume less fuel for the customer. So you step back and you look at all this, and it’s really cool and exciting and motivating to be a part of it. Alex and I and others in product planning here, we get faced with challenges every day to make this happen, but there’s an energy that you feel when you do make a difference. For example, we have an EV3 here and it’s just cool now and again to go down there and look at the car and take it out and drive it and feel like these cars just keep getting better and better and better, and they emit less and less and less carbon. They’re coming to market at lower and lower prices, and this is now, and so what’s in the laboratory is, I think, going to blow your mind, really.

John: That’s exciting.

Steve: Yeah, it’s cool. Alex, [crosstalk] I don’t know how you feel about it.

Alex: Yeah, for me simply it’s what I always wanted to do. So every day I wake up, it’s fun. As an engineering background, I always love the challenges, so it’s never a problem for me. The biggest part that I enjoy the most is some of the work we get to see taken out of laboratory now starting to see as a feature. At CES, we showed connected home, a Kia home, so we showed the process that some of the work we’ve been working on, having bi-directional energy come from the vehicles as part of this home fit. We’re really close to launching it with EV9, this vehicle-to-home feature, working with a partner called Wallbox based in Barcelona. We’ve done a couple of demonstrations with it. It’s at a conference recently where we showed another thing of it. In February, Secretary Granholm came to visit a site that we’re a part of here in Southern California. It was great to show the feature and a lot of the functionality that that can do. We’re going to soon get that in a customer’s hands and they’re going to really start to realize and see my EV becomes part of my life, part of my house and some cool features between saving for blackouts in those scenarios. During the most recent hurricanes in Florida and North Carolina, we’ve seen our Kia customers use the feature we have available today, vehicle to load and keep refrigerators running for four to five days until their power [crosstalk] gets restored. So we’ve seen that early return already on saying, hey, this feature, which launched with EV6 and EV9 and Niro EV of having vehicle to load, we’ve seen customers even in that relatively lower in use, still find a lot of great value out of it. So it’s a nice reinforcing factor of yeah, this is why it’s so important. We want to offer this to more people [crosstalk]

John: Really the automobile goes from just a strictly transportation purpose to a really cross-collateralized purpose in terms of a home feature for all sorts of things such as the recent tragedies and hurricanes and things like that as a backup, so they could have good food and shelter to help them get through that crisis.

Alex: That’s right.

John: That’s amazing. For a layman like me, just walk me through quickly, if I drive my Kia all day and all night, and now it’s almost at zero on the battery and I drive home and I have one of the highest fast charging systems. How long does it take to charge a full battery charge for one of your newer vehicles?

Alex: Yeah, so let’s say at home you have a 40 amp capable charger. It’ll probably take you about about nine hours or so if you’re fully dead in one of our big vehicles [crosstalk] so overnight.

John: Yeah. How about when I’m on the road and it’s has more amp possibilities?

Alex: Yeah, that’s right. So that’s one thing we really pride ourselves in EV6 10 to 80 in 18 minutes, so there and back. Basically, by the time that you get done with going into the convenience store, getting something, kids, and everything else come back out, cars done and ready to go. EV9 is similarly 10 to 80 in 24 minutes with a larger battery pack. So that’s something that we’re really excited about.

John: That’s awesome. Well, guys, it is just such a joy and honor to have both of you on the show and to highlight all the great innovation and affordable automobile products that Kia exists and has in the EV marketplace. To find Steve and to find Alex and their colleagues and all the great products they’re making in the EV world, please go to www.kia.com, K-I-A.com. Hey guys, it’s not only an honor to have you both on, because you’re both just great at what you do and you’re making the world a better place on a regular basis, but it’s really an honor because you are with your colleagues making the world a cooler, better, more sustainable place. That’s what I’m so grateful for. Thank you for your service. Thank you for your great work and then thank you for your time today on the Impact Podcast.

Steve: You’re welcome, John. Thanks for the opportunity. Really enjoyed the discussion, and look forward to maybe talking again, if you wish.

Alex: That’s right. It’s great.

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