Patagonia’s Yvon Chouinard calls himself a “benevolent dictator” who levies a 1% “Earth Tax” from his company to fund environmental activism. Currently Patagonia is funding a campaign to protect Bears Ears National Monument, now under threat from President Trump’s executive order this week.
Alison van Diggelen, host of Fresh Dialogues sat down with this revered pioneer of environmental responsibility. Chouinard explains how a Scottish rugby shirt inspired his Patagonia business; why he believes regenerative agriculture could save the planet; and what he’s doing to ensure Patagonia’s environmental mission continues after he dies. Chouinard’s book: “Let my people go surfing” is an attempt to challenge business as usual and the culture of conspicuous consumption. The interview took place at the Heritage Theater in Silicon Valley in October, 2016.
Listen to this special Fresh Dialogues “Uncut” podcast:
Here are some highlights of the conversation:
On his 1% for the planet “Earth tax”
Yvon Chouinard: Your typical large corporation is out to make as much money as they can for the shareholders. And what the shareholders do with their profits is their business. We believe it should be done in the business as well. I believe in taxes. Especially the kind of taxes where you get to decide where the money goes. I think that’s called taxation with representation… So we just tax ourselves 1% of our sales – not our profits – 1% of revenue is given away to 900 different small activist organizations working to save our planet.
On Private vs public ownership
Alison van Diggelen: You’ve said that your stock holders are ‘the people of the planet’
Yvon Chouinard: That’s right. When you’re CEO of a public company you have no power. Your board, your stockholders tell you what to do. I can do whatever I feel like. We’re sole owners. We can make quick decisions, be a lot more efficient, move quickly. I would never think of becoming a public corporation….I’m a dictator…
Alison van Diggelen: A generous dictator?
Yvon Chouinard: The most effective form of government is probably a benevolent dictator. Things get done. Look at American politics. The best you can ever achieve is a compromise. And compromise never solves the problem. It leaves both sides feeling cheated.
Alison van Diggelen: What else have you been able to do because you’re a private company and you have this “dictatorship”?
Yvon Chouinard: [Laughter] It’s all through the company. There’s no boss looking over your shoulder. It’s a level society throughout the whole company. Outside the company we’re getting to be very visible. I can’t believe the power we have. We’re getting invited to the White House all the time to advise on policy (under President Obama).
On Patagonia’s business conflict: making money vs saving the planet
Yvon Chouinard: I’d say buying a jacket from us causes less harm to the environment than buying a jacket from another company that doesn’t put all the thought and processes causing the least amount of harm. For instance, we only use organically grown cotton. That’s fine. Growing cotton organically causes less harm but it doesn’t do the world any good. It still causes the world a lot of harm. That’s why I decided to go into the food business. I want to go beyond organic foods, organic cotton to what’s called regenerative agriculture. The difference is, regenerative agriculture builds soil and captures carbon.
And so now I have to go to my cotton farmers – who supply us with cotton – and say: you can’t plow any more because every time you plow, it releases all the carbon you’ve captured back into the air. So agriculture is one of the biggest causes of global warming so it’s probably the biggest thing we can do to save this planet. I’m really excited about this. I think it’s our only hope to regulate the climate. We’re not going to do it any other way. Agriculture has a chance of sequestering so much carbon out of the air through changing our grazing practices and our farming practices; and basically going back to the old way of doing things. And that’s what gets me excited.
On Being a Reluctant Businessman
Yvon Chouinard: I never wanted to be a business man. I was a craftsman. I just happened to come up with ideas that people wanted. I love working with my hands. I slowly got trapped…I had no desire to get rich. I’ve done a lot of climbing on every continent and became aware of all the destruction to natural world…I decided to use my resources, which is my business, to do something about the natural world. That’s the reason we’re in business.
On the Scottish inspiration for Patagonia
Yvon Chouinard: I was in the business of making climbing equipment…I came to Scotland to climb Ben Nevis and saw a rugby shirt in department store in Edinburgh. Back then, active sportswear was basically grey flannel sweatshirts and pants. Men didn’t wear colorful sports clothes. It had a blue body, yellow stripes. I was wearing it around Yosemite, everyone said, ‘Woah!’ A light went off…I imported a few. I said, maybe I’ll get into the clothing business.
On Steve Jobs, Apple and influencing businesses to be green
Yvon Chouinard: We’re influencing small companies, not large companies. A lot of the green stuff is green washing
Alison van Diggelen: Do you feel Apple’s efforts are green washing?
Yvon Chouinard: Absolutely – it’s like that with every large corporation. They’ll pick the low hanging fruit, but when it starts getting a little tougher…They’ll do the things that turn into more profits, but when you really have to knuckle down and be truly responsible, they’re not going to do it.
Alison van Diggelen: What’s been your biggest influence in greening the world? Business side or consumers?
Yvon Chouinard: Young people. I wrote this book “Let my people go surfing” – that has gone around in 9 languages and that has influenced a lot of young people and small companies are really paying attention. The idea of changing large corporations is pretty naive of me.
On Patagonia’s business philosophy
Yvon Chouinard: I never liked authority, I never liked telling people what to do. We decided to do it in our own style. That’s the title of my book “Let My People Go Surfing.” I don’t care when you work as long as you get your work done. You go when the surf’s up. Not next Tuesday at 2 o’clock. So it’s affected our management style. It’s created a way of managing a business so that we’re not tied down. We don’t drag our butts to work every day. We skip up the stairs two steps at a time. You don’t have to do it like everyone else. We don’t hire MBAs; we don’t have advertising agencies. We do most things ourselves because we can’t trust other companies to do it.
Alison van Diggelen: Beyond your lifetime, how will you ensure Patagonia keep the environment central to its mission?
Yvon Chouinard: We’ve become a B-corporation company… In a B-corporation you can put down what your values are and they have to be values that are good for the planet, good for society.
Alison van Diggelen: Will your son or daughter stay at the helm?
Yvon Chouinard: I don’t know…I have no idea what’s going to happen after I’m dead.
Alison van Diggelen: Are you grooming them to do so?
Yvon Chouinard: Yeah, they are slowly taking over more responsibility, absolutely. My daughter is head of sportswear design right now and my son is on the board. They both have the same values that my wife and I have.
Alison van Diggelen: One last question: going back to Scotland – John Muir, I know he’s been an inspiration to you. Do you have a favorite quote or inspiration from him?
Yvon Chouinard: [laughter] When I was a climber, it was John Muir and Emerson, Thoreau and the transcendentalists, philosophers which had a different attitude to climbing mountains than say the Europeans did, which was to conquer the mountains and our attitude was: you climb them and leave no trace of having been there.
Listen to my report on Chouinard and consumerism on the BBC World Service (starts @16:00 on the podcast)
Here are Fresh Dialogues Transcript & Highlights of my BBC Report
Want to hear more interviews and reports: Subscribe to Fresh Dialogues on iTunes
This is the second in the series: Fresh Dialogues Uncut
The “Uncut” series launched with an in-depth interview with Google’s Dave Burke
What can Uber and Fox News do to change their hostile work environment for women? And how can organizations create a productive atmosphere where men and women thrive? Alison van Diggelen, host of Fresh Dialogues sat down with Julia Gillard, the 27th Prime Minister of Australia to get her insights. Gillard got the world’s attention after making an impassioned speech to parliament, detailing the sexual harassment she endured as prime minister. Her Misogyny Speech has empowered many women and a provided a wakeup call for “unenlightened” men.
“I will not be lectured on sexism and misogyny by this man…I was personally offended by the leader of the opposition cat-calling: ‘if the Prime Minister wants to, politically speaking, make an honest women of herself ‘ and when he went outside the front of parliament and stood next to a sign that said ‘Ditch the witch’…(and) a sign that described me as ‘A man’s bitch’, I was offended by sexism, misogyny every day from this leader.” Julia Gillard, 27th Prime Minister of Australia
The BBC World Service program, Business Matters aired my interview with Julia Gillard last week, and we had a lively discussion about the steps companies and organizations can take to tackle sexism. This topic is especially timely as news broke this week that Bill O’Reilly has been fired from Fox News due to a sexual harassment scandal. Is the tide finally turning, thanks to tech augmented consumer pressure?
“Company reputation and consumer pressure is actually putting the spotlight on businesses to change behavior, and women can work with that to put a spotlight on work practices in their business,” Julia Gillard.
Did Julia Gillard anticipate Bill O”Reilly being fired?
Listen on the BBC Podcast (@26:40) or to the short clip below:
Here are highlights from our conversation:
I began by asking her if there’s anything she’d add to her speech in today’s work environment…
Julia Gillard: It was coming from a place of frustration and mounting anger about the way in which gender has intersected with my prime ministership and some of the many sexist jibes and treatment I had to put up with. For many women, it’s come to represent something that answers their own frustrations. A lot of women come up to me and say: “this happened to me at work. I wake up at 3 in the morning and really wish I’d said X, Y and Z; and then I’ve watched your speech and it’s given me some heart that I really should call out sexism when I see it.”
Alison van Diggelen: Here in Silicon Valley, women in tech are in a minority. In some instances they’re facing hostile environments at work. Do you have any specific advice for them?
Julia Gillard: What’s interesting about the Silicon Valley environment is: company reputation and consumer pressure is actually putting the spotlight on businesses to change behavior, and women can work with that to put a spotlight on work practices in their business; and put a spotlight more generally on that fact that not enough women study and come through the STEM stream… We do want to be encouraging more girls to go into the sciences, engineering, into coding, computer science and new technology because that’s where so much of the future is going to lie.
Alison van Diggelen: Uber has been accused of having a hostile environment for women. If you were on the board of Uber, your advice to them?
Julia Gillard: I’d give the same advice to any company, whether it already had a public problem or not. First look at hiring practices and see whether there’s any gender bias, even unconscious…Look at promotion practices, it could be managers valuing time sitting at the desk rather than results, which would count against women who also have family responsibilities. I’d be setting policies, practices, cultural norms about treating everyone with respect. No practices of going on boys’ nights out where women are excluded.
There’s a range of things you can do from structural biases, actual policies to cultural influences. You’ve got to be thoughtful at every level and make it easy for women to say something’s wrong here, all sorts of ways of raising a complaint, including putting in complaints with anonymity, so women can get a spotlight on issues without feeling they themselves are at risk.
Roger Hearing: Asit Biswas (in Singapore), in your experience, in the areas of government and academia, do you feel a lot of progress has been made?
Prof Asit Biswas: There has been some progress, but it’s not enough. In academia, the number of university presidents who are women, I can count on two hands…there’s a great deal of glass ceiling…In India, I was surprised to see the culture has deteriorated: there’s more harassment, not much being done about it.
Alison van Diggelen: I do want to go back to Julia Gillard’s point about consumer pressure. Boycott movements* (and demonstrations) are happening against Fox (News) because of accusations of sexual harassment…
Roger Hearing: We should explain, Bill O’Reilly…There have been allegations against him and it’s emerged that money has been paid to those people, though he says the allegations have no merit.
Alison van Diggelen: Exactly. There are boycott movements shining a light on sexism and bad behaviors. Companies can’t get away with it like they used to. Tech is playing a role in exposing these bad behaviors and a lot of companies are aware of it and are trying to close the income gap and improve the retention rates of women, and making sure that all men become enlightened men and treat women with the respect that they deserve.
*Mercedes-Benz – one of the first major sponsors to drop Bill O’Reilly – said in a statement: “The allegations are disturbing and, given the importance of women in every aspect of our business, we don’t feel this is a good environment in which to advertise our products right now.”
This interview took place in the green room of The Flint Center in Cupertino. Big thanks to Dick Henning, founder of the Foothill College Celebrity Forum Series for the invitation backstage.
Imagine if you could help end homelessness with the click of a button. There’s an app for that! In Silicon Valley, despite the vast affluence and many tech millionaires, homelessness is a huge problem. With average home prices close to a $1 million and tiny flats renting for well over $1,000, making ends meet can be challenging; and for some people, just finding a roof over their heads is mission impossible.
Alison van Diggelen, host of Fresh Dialogues met one woman whose homeless brother inspired her to change all that.
“For those who are homeless and poverty stricken, it’s like having a life coach, a service provider and a trainer in the palm of their hands. There’s really something to teaching to fish…rather than giving fish…helping them be self sufficient rather than temporary handouts… We’re here trying to help in other ways that are more sustainable and that lead to a permanent resolution of the problem.” Karen Addato, Founder of Hi Tech Rover and ROVA app.
Here’s my BBC World Service report. It aired April 4th on the BBC’s World Tech program, Click. Listen @15:40 for Host, Gareth Mitchell’s introduction on the April 4th BBC Podcast or to this short clip:
Alison van Diggelen: I’m here on the Hi Tech Rover, an RV (large camper van) that brings both the internet and a safety net to homeless people all over San Jose. Karen Addato (founder of the Hi Tech Rover and the ROVA app) and her volunteers offer an opportunity for homeless people to get off the streets and reboot their lives. They offer Internet training, help with online job applications, housing search, and even access to detox services.
Karen, where are we going right now?
Karen Addato: We’re in downtown San Jose, the Capital of Silicon Valley and we’re going to a couple of encampments under bridges, right here in the heart of town. One of them is on Woz Way…
Alison van Diggelen: Woz as in Steve Wozniak, cofounder of Apple and generous philanthropist here in Silicon Valley. Karen Addato is a vivacious single mom, a mortgage broker and executive director of the nonprofit: High Tech Rover. She used $7,000 of her savings to create this Rover Outreach Vehicle App prototype, ROVA for short.
Karen Addato: For those who are homeless and poverty stricken, it’s like having a life coach, a service provider and a trainer in the palm of their hands… when we’re not here helping them, they can stay on a pathway focused on upward mobility. They can get on to ROVA and press one button.. “I am seeking help.” Up comes a list of resources available for that gender and age group. We have a geo-tracker right here, so you can find out where they are…This tool will also help government officials, donors, and service providers figure out what’s needed and what’s not.
Alison van Diggelen: Connecting homeless people with jobs, training opportunities and relocation information are a key for Addato. Her brother Stevie was homeless in Boston, and she believes that those who supported his panhandling simply enabled his alcoholism and homelessness. Instead, she’s serious about connecting people to local services, and getting people off the streets for good.
Karen Addato: I’ve learned a lot in my time in the trenches working with this population…I’ve learned a lot through the life and tragic death of my brother…There’s really something to teaching to fish…rather than giving fish…helping them be self sufficient rather than temporary handouts… that in some ways is part of the problem. We’re here trying to help in other ways that are more sustainable and that lead to a permanent resolution of the problem.
Alison van Diggelen: The High Tech Rover – a huge camper van – is kitted out with desks and laptops. Addato and her volunteers take it to homeless camps around Silicon Valley.
Atmos: Sound of walking to homeless camp…traffic…
Alison van Diggelen: We make our way over rough ground to the confluence of Highways 280 and 87. Addato grabs her pepper spray, just in case. We find a half dozen scruffy tents stretched out along a concrete embankment. Below us: the Guadalupe River. Above us, although it’s midday, there’s a constant drone of heavy traffic.
Jason, whose name has been changed to protect his privacy, tells me he’s been homeless for 2 years. He’s 19 and working two jobs, earning between 11 and 17 dollars an hour…
Alison van Diggelen: You can’t get a decent roof over head with that?
Jason: Not in Silicon Valley, it’s too expensive…one bed’s like $1300, it’s crazy out here. Us teenagers, we need help. Not all of us want to be here forever.
Alison van Diggelen: Every morning, Jason has to find a place to shower and clean up for his service jobs. We tell him about Karen’s app. Would that be a useful tool?
Jason: That’s actually a very brilliant idea, because a lot of us actually have phones… I’ve actually wanted something like that. Keep helping!
Alison van Diggelen: I ask another young man, what would help him?
Charlie: San Jose needs to lower how much it costs to buy a house, their rents…you need to live with like three people, making at least $20 an hour to end up being able to have your own place in San Jose.
Alison van Diggelen: The ROVA app includes a database of over 700 low-income housing facilities in the county. Both young men plan to relocate out of state when they can afford it.
Like many in Silicon Valley, Addato dreams big and is seeking sponsorship from the tech community to launch her app, and create a whole fleet of High-Tech Rovers across the nation. She recently pitched her dream at the Apple campus and remains hopeful. The wider tech community is already tackling homeless via brainstorming hackathons; leveraging data-driven solutions and social media to spotlight community challenges. In Australia, an app called “Ask Izzy” already offers similar services to ROVA.
Read more BBC Reports at Fresh Dialogues
Join the conversation on Facebook
Check out the Fresh Dialogues iTunes podcast
By Alison van Diggelen, host of Fresh Dialogues
It’s day four of the Donald Trump presidency and he’s already infuriated women’s rights campaigners, the environmental movement and free trade advocates by signing controversial executive orders. Tech mastermind, Steven Levy put it best in his latest tech report: God help us all.
Millions around the world took to the streets within hours of Trump’s inauguration, in anticipation of these actions and more to come. The San Jose Women’s March took place here in Silicon Valley on Saturday, and in my twenty years in the South Bay, I’ve never witnessed such an outpouring of alarm, dismay and rage. One 70-year old educator I interviewed said that this was the first time in her life, she’s ever felt the need to stand up and take to the streets: not for women’s rights, not for civil rights, but to protest Trump’s presidency. And she was fired up. Today, my report aired on the BBC World Service.
One protester had this message for Silicon Valley tech leaders:
“Lead with faith, lead with truth, and lead with a kind of human dignity that is absent in a lot of our daily conversations…They gotta get rid of the fake news, people are being led down a kind of primrose path, thinking that by being angry and violent they’re going to create a better world for the future…that’s not the path, the truth, the reality that everyone can see here today,” Patrick Adams, science teacher at Bellarmine College Preparatory School in San Jose
Listen to my report and the discussion at the BBC World Service (from 2:40 in the podcast)
Gareth Mitchell: The President Elect became President on Friday….the crowds were back on the streets on Saturday, this time in protest at the new administration. The marches around the world were led by women, but in Silicon Valley, the tech people, male and female were venting their concerns too, along with scientists, and entrepreneurs, all of them worried by Trump’s stance on trade, innovation, science and the climate. It comes in an era of disquiet about Facebook and fake news, of post truth and cyber threats. To gauge the sentiment, our reporter in Silicon Valley, Alison van Diggelen, was at one of the marches.
Alison van Diggelen: I’m here at the San Jose Women’s March in the center of Silicon Valley and the women are out in force…
Yogacharya O’Brian (reading her poem, “Forward Women”): Not to the back of the line, because Delores walked in front; not to be held down, not even by gravity because Sally soared in space.
Alison: That was Yogacharya O’Brian, founder of the Center for Spiritual Enlightenment and one of the rally’s powerful speakers.
Alison van Diggelen: Silicon Valley took to the streets in record numbers on Saturday to protest the country’s new president. Donald Trump’s proposed tax cuts and infrastructure investment could benefit the tech community; the U.S. economy and many of those marching in Silicon Valley. As could his plans to repatriate millions of dollars of tech companies’ overseas profits. Last month Trump even hosted a cordial summit with some top tech leaders. Despite all this, many in this community are fearful of what his presidency might mean for innovation, transparency, multiculturalism, and social progress.
Nick Shackleford: I’m here because of Trump’s election…he is bringing America back in time instead of leading us forward. As a nation we need to go forward and not backwards.
Alison van Diggelen: Here in the world tech center of innovation, what do you expect from this community of innovators?
Nick Shackleford: Like you said, we are innovators and I think we’re going to continue to innovate and lead the country – and sometimes the world – in the innovations that are being developed here in the Silicon Valley. And we have a lot of millionaires and billionaires who are liberal, believe in the cause and are true Californians and they will continue their fight, be it with their money, and their power or just lending their voice to causes that are important to our nation.
Alison van Diggelen: What would you say to Mark Zuckerberg and people like him with power?
Nick Shackleford: I think Mark Zuckerberg did not to enough to stop the fake news. I think he cared more about (getting it re-shared and) his personal stake in his company…and he can’t convince me otherwise. He’s to blame for a lot of the fake media.
Alison van Diggelen: What would you have him do?
Nick Shackleford: I’ve reported about 100 things in the last six months and nothing has been in violation of their policy, but I’ve seen other people get the same picture and be sent to Facebook jail for it. So he’s not consistent, there needs to be more transparency on this fake news fight.
Patrick Adams: They gotta get rid of the fake news, people are being led down a kind of primrose path thinking that by being angry and violent they’re going to create a better world for the future…that’s not the path, the truth, the reality that everyone can see here today.
Alison van Diggelen: Patrick Adams was one of many men who came out to support the women’s march. Like many protesters who couldn’t keep quiet, he was energized by the proliferation of fake news, and Trump’s use of “alternative facts” which continues this week in the heated dispute over his inauguration numbers. Adams had a message for Silicon Valley’s tech leaders….
Patrick Adams: Lead with faith, lead with truth, and lead with a kind of human dignity that is absent in a lot of our daily conversations …Everywhere I go I see wonderful, amazing, beautiful people working together to make this future happen and I also see people who’re giving up…either to escape into an alternate world of the Internet or they want to pretend that this doesn’t affect them. But if affects everyone. Everyone is involved.
Yogacharya O’Brian: We do not wait for you to lead with sons and with daughters in hand, with husbands and with wives, lovers and friends by our side…we march!
Crowd chanting, cheering
[End of report]
Gareth Mitchell: What do you make of the comments you heard there, Bill Thomson?
Bill Thomson: It was fascinating to hear via Alison’s excellent report just how confused people are, and how uncertain they are; and how many different perspectives there are. For me, as a member of the press, what we need to be doing is reporting effectively on what’s actually happening, not just reporting on an agenda set by politicians…So the limitations on women’s reproductive rights, the Keystone XL pipeline, the Dakota Access pipeline, the Transpacific Trade Partnership, the nomination of the Supreme Court justice, are all far more important than the size of Trump’s inauguration crowd.
There’s a real sense from Alison’s report that many people are confused because they don’t know what’s actually going on and are trying to project on that. It’s the role of us in the press to cut through that and be much clearer about what’s actually happening and not get dragged into debates or agendas set by other people.
Read more stories about Donald Trump on Fresh Dialogues
By Alison van Diggelen, host of Fresh Dialogues
The race to build the “ultimate” electric car is heating up. Every month, it seems another electric car company joins the fray to offer a car stylish enough to attract the Tesla crowd, and affordable enough to meet the growing demand from China, the United States and Europe.
NextEV stands out from the crowd for two reasons:
- It has solid backing, from a broad range of top venture capital and Internet companies like Sequoia and Tencent.
2. Its Silicon Valley R&D facility is led by Padmasree Warrior, “The Queen of the Electric Car” and she’s rapidly attracting top tech talent from the likes of Tesla and Apple.
Last month, I attended the grand opening of NextEV Silicon Valley and interviewed its founder, William Li. He shared his “Blue Sky” ambition (he means it literally) and how his grandfather inspired him to go from cattle herder to Internet multi-millionaire. It was the first interview he’d ever done in English. I filed this report for the BBC World Service’s Tech Program, Click.
Here’s a transcript from today’s program, with some great insights from host Gareth Mitchell and BBC contributor, Bill Thompson. The transcript has been edited for length and clarity:
BBC Host, Gareth Mitchell: One event that did happen was the recent launch of yet another electric vehicle outfit in California. This is the Silicon Valley division of a Chinese startup called NextEV. The champagne flowed and the ribbon was cut – the digital ribbon – but our reporter Alison van Diggelen was most interested in the economics of it all. You don’t need to be an investor to know just how risky these ventures are as the technology gradually matures. In California and China state funding and tax breaks are all part of getting these businesses off the ground. Alison tracked down NextEV founder, former cattle herder and now big time entrepreneur, William Li.
Alison van Diggelen: At NextEV’s Silicon Valley launch, William Li confirmed that on November 21st, NextEV will reveal its first supercar in London. The electric car is expected to offer a 0-60 acceleration in under three seconds. Its Formula E racing team has used a dual-motor setup on its race car, and it’s likely to be a feature of the supercar. (The top speed of the sleek two-seater will be over 180 mph, and its price is likely to be equally extravagant!)
NextEV is late join to the electric car race. So how does Li intend to challenge Tesla and the dozens of electric car companies popping up worldwide?
William Li: Tesla is a great company, I respect them. But Tesla was founded 2003. Lots changed. It’s a mobile internet era. We can do better to communicate with our users, give our users a much better holistic user experience.
He aims to do for the car what Apple did for the smart phone.
He learned a lot about user experience from Bit Auto, a popular web portal in China and his first business success. He’s now built a global startup – with facilities in Beijing, Shanghai, Silicon Valley, London and Munich. The global workforce is 2000.
In Silicon Valley, its 250-strong team of auto and software experts is growing rapidly. U.S. CEO Padmasree Warrior – former CTO at Cisco – is hiring experts in artificial intelligence, voice interaction and user interface from the likes of Tesla, Apple and Dropbox. Warrior says they’re already working on affordable cars for China’s burgeoning demand.
Padmasree Warrior: In China, There’s a large shift happening … Environment issues are driving the government to look at electric vehicles as part of the solution… It’s healthier for the environment to drive an electric vehicle.
China is offering generous tax incentives to electric carmakers and consumers, driving a flood of companies into the space. NextEV recently signed an agreement with the Nanjing Municipal Government in China, to build a $500 million factory to build electric motors.
Similarly in Silicon Valley, a fleet of electric car companies has chosen to locate here, thanks to state tax incentives and the strong talent base. These include Tesla, Atieva, and Le Eco.
I spoke with California’s Director of Economic Development, Panorea Avdis. She explained how state policy is helping reduce greenhouse gas emissions, by focusing on the tech industry…
Panorea Avdis: The goal is to have 1 million electric zero emission vehicles on the road by 2020.
(Today, California has about 300,000 electric cars, about half of the nation’s total.)
Alison: NextEV secured $10M in tax credits. Tell me why that’s cost effective for the people of California.
Panorea Avdis: The return on investment…nearly 1000 jobs in the next 5 years, speaks for itself. California is leading the way, there’s no other state in the union that has this type of aggressive polices and it’s really inspiring this innovation in technology to come forward.
But making cars is notoriously hard. News broke this month that Apple is shelving its electric car plans to focus on self-driving software.
William Li knows it’s a tough road ahead. He gives his company just over a 50% chance of success.
As a boy, Li was a cattle herder in China. He’s come a long way and credits his grandfather’s wisdom:
William Li: [Speaks first in Mandarin ] The journey is more important than the result. So follow your heart….your original wish. Don’t worry about failure.
Like Tesla’s Elon Musk, Li is concerned about climate change and also the dense smog in Beijing and Shanghai. He blames polluting gas-guzzling cars.
NextEV’s brand in China is called “Way-Lye”
William Li: It means blue sky coming. That’s my original wish.
It’s an ambitious goal that could be a very long way off, especially in China’s congested and polluted cities.
Gareth Mitchell: That’s Alison van Diggelen reporting from Silicon Valley. So Bill Thompson – the journey is more important that the result?
Bill Thompson: The result is much more important than the journey here, because unless we get much cleaner public and personal transport, then we’re in big trouble. It’s really good to see another serious entrant in this market. It’s not sewn up yet by anyone. As we heard there about Tesla, there’s no first mover advantage because the technology is developing so quickly.
We know Padmasree Warrior’s reputation for delivering. She’s been on the show a few years back. She was senior at Motorola, then went to Cisco. They’ve got really good people.
But the really interesting part of this is what happens in China. In China because they have much more control over what people can do. The government can actually mandate a move to electric vehicles much more easily than they ever could in California and that gives a great market. So NextEV may be getting money and expertise over in Silicon Valley, but it’s what happens in China that’s really interesting.
Gareth Mitchell: I was interested in the economics side of the piece: the reliance partly on state funding to get these businesses going.
Bill Thompson: Occasionally state funding helps. You might have heard of this little thing called the Internet, kicked off with defense department funding from the US. It did pretty well by being able to rely on that funding for a critical period while it developed and then was able to be used by the private sector. One or two of these examples of it actually working…