Snippets with Leon Goren

The End of Combustion Vehicles with Novx Systems' Keith Beckley

May 30, 2021 Leon Goren, PEO Leadership Season 2
Snippets with Leon Goren
The End of Combustion Vehicles with Novx Systems' Keith Beckley
Show Notes Transcript

Keith Beckley, CEO of Novx Systems, long-time member of PEO Leadership, physicist, engineer and climate activist, talks passionately about his “night gig” – following the EV industry. Keith took delivery of the 2nd Tesla Model S in Canada and spends his nights actively learning everything about EVs and the energy industry. Thinking about purchasing a new or used combustion engine vehicle in the coming months? Be sure to listen to this interview.

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Leon Goren:

Special thanks to Sherrard-Kuzz for helping u bring you today's PEO leadership snippet podcast. Welcome to our snippets podcast. I'm Leon Goren, CEO and president of PEO leadership, North America's premier peer to peer network and leadership advisory firm. Today, we welcome Keith Beckley, CEO of novec systems, which is an EMR system for your addiction and pain. If you're like me, you don't know what EMR stands for. But it is a computer system that helps healthcare providers manage patient medical records, and automate clinical workflows. So Keith, and I go way back. We've known each other since the age of 12 years old when we attended winfields Junior High School in North York. we partake in many adventures throughout life, whether it be competing in the pool, swimming and playing Water Polo, or launching one of our first companies just white shirts, calm back in 1996. He is a physicist, engineer, climate, sport and all round natural athletes standing six foot five. He's a world traveler having visited more than 57 countries. And of course, he's a longtime member of PLL leadership. Keith, it's great to have you with us today.

Unknown:

Oh, hello. By the way, I didn't really compete very well with you in the pool. I'll tell you that.

Leon Goren:

Except for the water pool.

Unknown:

It was very good.

Leon Goren:

Alright, so let's three things we're going to cover here today. Why don't you give us a little bit of sense, better sense of Novak's and then two, we're gonna jump into your real passion here around EBS. And you're gonna educate some of the listeners around where we're going and and stuff. And then third, if we have time, we'll jump into energy. So we'll kick it off on novex. Tell us a little bit more about what you do.

Unknown:

Yeah, so novex was founded, it was actually early into the space and was founded in 2003. And we've turned into sort of a boutique bar in the sense that we are we we are market is specialists, so most of them are companies came out and they did a land grab into family practitioners, which is the vast majority of the market. But we found our place in specialists, diction, pain, psychiatry, and we just focus on having dashboards and templates that really sing to that community. So it's a wonderful business, it's a monthly recurring revenue, the government pays the doctors, we know they get paid, so they pay us. And, you know, we build something super tailored for that. And then when we sort of saturate a silo, we look at another silo of specialists so we can grow kind of at the speed we want. And it's it's a small team. But you know, all my employees have been with us for the better part of a decade now. And it's a good business. It's a good business to me.

Leon Goren:

That's awesome. And I know it's a, I know, you work that job during the day, and then you're up all night reading about everything on the energy side. So for those that don't know, and most of you don't know, Keith, on the second Model S that was delivered in Canada, he really bugs in that he didn't get the first one, but he wasn't number one slotted for the delivery. So you got the second. But he studies all this stuff like crazy. So I thought it'd be a great conversation, maybe you can tell us where we are today compared to when you bought your first one. And where's this whole thing going? Everybody's sort of saying it's, you know, Tesla is way overvalued. It's going up, up, up and away. A lot of people are we disbelievers in it, but you're a big believer in the whole system and where it is today and where it's going.

Unknown:

Yeah, for sure. So my interest in this early on, I've always been interested in energy and energy systems. And you know how society was gonna move for that. It's turned into a ridiculous passion. You're not wrong to say it when the business day is over. I spend my night listening to podcast researching, following others who, right, so I put my deposit down very early in 2009, got my car in 2012, I was very sure I was buying a lemon that I would be spending inordinate amounts of money on a battery after three years. So it turns out none of that was true. Turns out the car ended up being incredibly reliable. I have it's still it's 250,000 kilometers. My battery degradation has been less than 10%. You know, it's turned out to be a very, very good car. And, you know, I've been really, really following this space. And I don't think quite in North America, we realized where this is going. So I'll give you a little bit of a picture of where things are. So in Europe Where they have a much more aggressive tax policy around hydrocarbon especially around the price of gas. ie V's are taking off like crazy. Basically, if you build it, someone's gonna buy it. No one's has any car sitting around on lots. Tesla is the leader, but it's now only one. Volkswagens taking it very seriously as well. And about 10% of cars sold in Western Europe now are our E V's. And the leader is Norway. There's actually a superbowl commercial in a way about this. So Norway now, in the latest year, they have stats is over 90%, either a pure Evie or a what's called a hybrid. So a car with partially Evie and, and a gas extender, as well. And if you think about that market now, and this is what I really want to get people to understand, if you're buying if you're one of the last 10%, who's buying a petrol driven car, a gas driven car, think about what that car is worth in five years. Nobody wants that car. Right. And that ship has already sailed in Norway, and we're on that s adoption curve, and things are starting to go vertical, right. And it's just beyond a massive shake up of the industry. And the traditional automakers, you know, we're gonna struggle, some will come through and some won't. And the reason they want is because long ago, they stopped being anything but having IP and engines right. And now, engines is no longer important. What's important is batteries and electric motor drive train. So they're they're very much struggling and trying to figure out how to make this transition and make it profitably. So there's, you know, and then so you have that kind of drag, but then the flow of the market is that countries and many in Europe, in some jurisdictions in North America are now trying to put in dates, the earliest ones being 2025, many around 2030, when no more diesel or gas cars will be able to be sold in those countries. That's very European, the biggest car market, three V's in the world is the Chinese who basically want to be a leader in this space. And when you have such a massive technology disruption, it's such a great opportunity for them to come in. There's over 80 Evie companies you've never heard of. There's only two in North America of the Chinese. But there's 80 in China that are trying to win this market. And the government there is absolutely dead serious, mostly because they got a smog problem. But they also want a big player in the automotive market. And they don't want to have to do it the Japanese way when you come in with cheap and cheap cars, you know, back in the 70s, and 80s, and then build their way up to, you know, the reputations that have today. So all of this to say it's it's massively disrupting it's, it's coming fast. The only knock against EBS right now, I would say is that the initial capital cost is still higher, but it's coming down very rapidly because the price of batteries is coming down. But the data is in now on the carrying costs. So the total cost of cost of ownership. And the data is as following. If you buy an Eevee over its lifetime, your cost of maintenance is exactly about half of if it is for an internal combustion engine car. And if you buy an Eevee your cost of driving it. In other words, the energy is about 20%. So if you're spending $100 a month in gas, you're spending $20 a month in on your electricity bill. So the total cost of ownership is already a win. But for some folks, obviously that upfront sticker price is everything. So that's all to say that this is coming on incredibly fast. And as far as I'm concerned today, given the availability of models, you know, every company now has at least one Curie V, some have to some have three. It is a really questionable decision. Financially, forget about the performance and the ease of use and all that kind of stuff financially very questionable to still buy an internal combustion engine, even in North America where it's only 3% of the market, but growing from last year, which was 1%. So I'm not sure you have any other specific questions, but I can I can certainly knock off some of the benefits of the Eevee space if you want to hear

Leon Goren:

well. It's funny because you said in Norway, the US cars market is basically done right? If you're in North America today, the used car market is absolutely insane because of the shortage of cars. So if you're actually going to buy a car today, you're going to pay a fortune. And what you're suggesting is in the three years, whatever you paid today, it's actually going to be worthless, worthless. Potentially in three to five years.

Unknown:

Yeah, if it's easy is that held up their value very much, because every one that's built is sold. But yeah, I think that you're definitely going to go to a point where you're trying to sell a car into a market, that's not desirable, because the cost of running an Eevee is so small in comparison to a gas car. So if you think about, I'm buying an Eevee. So I'm buying a used gas car, which is probably coming off warranty, I have to fill it with gas, I have the maintenance stuff coming down the pipe. Whereas I can have an Eevee with, you know, 20% of the cost to run it. Basically no maintenance coming. And all the conveniences. So

Leon Goren:

what about the infrastructure, though? Because I know it was a worry a few years back, or is it set up now? Like, do you have any concerns? If you want to get down to Florida? You want to go to California? driving from Toronto? When the borders open? Of course, how easy is it to do it? And are you stuck at a so called charging station for 45 minutes to an hour having to recharge?

Unknown:

Right? So this is a great question. And I think the answer is slightly bifurcated. I don't want I, the Evie space is great, I do have to give one small plug for Tesla here, their particular charging infrastructure is second to none. So I have done that Florida trip down and back. And it was seamless, painless, not a problem. And the thing you so I'll say two things about charging then one is that people don't realize is you do 98% of your charging at home. Right, you actually rarely use these chargers out and about because most of us don't travel more than 500 kilometers a day, which is a range of of, you know, the batteries or even 300 kilometers a day. But getting back to the road tripping. So the speed, the amount of current, the power they can put into the car just keeps going up. And the battery's ability to accept that power keeps getting better. So what was a 45 minute stop now has come down to around a 20 minute stop. So it barely gives you time to have a nature break and grab a bite to eat. And we certainly had that. And then the other thing that people don't really realize is you never drive the car to zero and charge to 100. Typically, what you do is you drive the car down to about 20% like a gas tank, right when the light comes on 15% and we fill up so you drive the 20%. And then you fill it then you charge like 80% which, which is the fast part of the charge the slow part of the charges from 80 to 100% of the taper it goes it's much slower. So you go fast to 80. And then you drive for three plus hours until you get to the next charger when you're down to 20 and you go to 80. And then you're in that 20 minute range. And the number of charges is just exponentially increasing, whether it's the Tesla system or the or any of the other ones. So it's kind of a salt problem.

Leon Goren:

All right, I know we're going we're going a little longer here, I wanted to touch on that last topic on energy. And if you had to summarize because we don't have time to really dig into this. But what's going to be the one big visible thing that people are going to start to notice sort of on a bigger picture around this whole hydrocarbons thing over the next few years.

Unknown:

So I like to say it this way, this is going to be the decade of wind, solar and batteries. So and when they'll be offshore and onshore and the price of wind and solar and batteries are dropping so fast, that they absolutely beat out every new incremental, every new bid that's out there for new energy is going to be basically wind or solar, or else somebody is making a really bad economic decision. So then when you take the variability of wind and solar, either wind doesn't blow the sun doesn't shine all the time. And you add battery, which is also used to technically to stabilize the grid, because batteries can basically respond almost instantaneously to demand or over supply. You're basically going to have grids that become incredibly more resilient than the ones we have now. And they are going to basically become hydrocarbon free. And if you are someone who Well, I'm not going to talk with the coal industry, the coal industry has done, it knows it's done. But even natural gas now is very much struggle over the next decade. And you're gonna see a lot of plants that were built in this past decade or the 2000s that are supposed to have 40 or 30 or 40 year lifetimes and they're going to be stranded assets. It's been written off. It's an incredible fat, incredibly fascinating time in this space, which has always historically been a very sleepy space, but it's hyperactive.

Leon Goren:

That's great. So a couple of points out of there, but the big one that I think people may want to take a look at, they took a look at the personal investments in terms of how they're investing. And if they own some of these sleepy acids that have been just utilities in terms of generating returns for them. A stranded asset means it's going down to zero at some point in time.

Unknown:

Yeah, yeah. So you can own utilities, but not utilities that have a lot of hydrocarbon assets.

Leon Goren:

Yes.

Unknown:

Well, Keith,

Leon Goren:

thanks so much for joining us sharing all those insights. If you're interested in any of our live webcasts the way forward live or any other snippets, please take a moment and visit us at po dash leadership comm you'll find on our site various previous recorded webcasts, which include guests such as Professor Kenneth Stein, Harvard's Rosabeth Cantor, Rob Chesney, Dr. Greg wells, Morgan housel, Mitchell goldar, and many more as we cover such topics as Mental Health Leadership and the world reset. Thank you for joining us today and we look forward to seeing you again shortly.