This
interview has been transcribed as is, leaving out “ah”s and “ehm”s and
repetitions for clarity and easy reading.
Vuyo: Have
you ever asked yourself – in fact this comes from the conversation we had just
the other day with another National Order Recipient, Musibudi Mangena. We were talking about his ten years as
minister of Science and Technology. He
spoke about spear-heading this initiative to create an electric powered car
here in SA – the Joule. Well, in case
you have been wondering where it has gone to, this morning we are joined by
Kobus Meiring who is the former CEO of Optimal Energy, the company that developed
the Joule. Kobus, good morning to you.
Kobus: Hi, Good Morning.
Vuyo: Welcome, thank you for joining us here on
Morning Talk on SAFM.
Kobus: Thank you for inviting me.
Vuyo: OK, so, let us just check: What happened to
the Joule?
Kobus: Well, we had to close down the company,
Optimal Energy, about the middle of last year, and one of the shareholders of
Optimal Energy is the Technology Innovation Agency and they essentially took
all the vehicles and all the equipment and all the IP and so on and I think
most of that has been given to the Nelson Mandela Metropolitan University.
Vuyo: You had also made a specimen car – what is it
called, a test vehicle?
Kobus: Yeah, we’ve all in all made about 10
prototypes of which the last four were what we call customer-ready prototypes
of the Joule, so the look, the feel, the performance, everything was
essentially as the final vehicle would be except that these were hand-made, they
were not made in a production line.
Vuyo: Yeah… And the cost… how much money had been
invested in this project up to and including when you closed it down?
Kobus: Round about 300 million. I don’t know the final number, but that’s a
sort of a ball park of which… Well, a little bit of history: The first investor
was in fact the Innovation Fund which was an instrument of the Department of
Science and Technology at the time that Minister Mangena was the minister of
Science and Technology. They were then
later joined by the IDC - the Industrial Development Corporation - who became
the biggest single shareholder. Then the
Innovation Fund was in fact disbanded and absorbed into the Technology and
Innovation Agency about two years ago… so that is a quick history of the
shareholders - of the investors.
Vuyo: So have we lost this initiative now? No
electric powered car can come out of SA in the present context?
Kobus: Sjo, that is a big question. I think what is absolutely true and clear is
that you cannot start an industry like this without firm government
support. And when minister Mangena was
still there, he was a great champion of this cause and he championed this at
cabinet level and we had the necessary support there. And I think this is not just only true of SA,
it is true anywhere. If you look at the
South Korean industry, if you look at a lot of other industries, government
took a decision that this is what they are going to support and this is how
they started the industry. Because these
are long-term investments, these are not overnight get-rich-quick-schemes, they
are really long-term investments. So
while we had the necessary government support, things went very well. The IDC came on board and the IDC eventually
said look, we need government to spell out exactly what they had in mind and
how they support this thing and until they do that, we cannot continue putting
money into this thing and that really was… to some extent…the end. So if you say is it impossible, is it dead, I
would say that unless government really spells it out very clearly, what they
want to do and where they want to go, it probably is dead as it is. I think we certainly have the ability in this
country, we have the human capital, we have the knowledge, the experience,
whatever to make this work, there is enough resources to make it work without a
doubt but it is not something you start without very strong national support.
Vuyo: How far were you from going to production with
perhaps even becoming… getting the car to be commercially available and that
kind of stuff?
Kobus: Well if you divide the total process into
sort of three big steps, then the one is the prototype development, the second
is setting up the plant and doing series production and then obviously the
third is to market and sell these things.
We had completed the prototype development. I think all in all we have done about 40 000
km electric on these cars without incident and we were ready to start the
production, the series production part of the process, which is a very
expensive part, which is typically in this industry and in many industries, an
order of magnitude, sometimes even two orders of magnitude more expensive than
the initial development process and that is really where we got stuck. We had lined up quite a number of potential
partners, suppliers, industrial suppliers all over the world to set this up; we
had lined up the East London Industrial Development Zone... They bought into it
quite strongly, they gave us a piece of land and they were willing to put up
the plant in exchange for a long-term lease.
So many of the pieces of the puzzle were in place and if you look at the
Industrial Policy Action Plan at the time it actually spelt out very clearly
(the policy plan that the DTI publishes and sort of updates on an annual basis)
it spelt out very clearly support for the commercialisation of the SA electric
car. So… in a sense you can look at it and say well everything was in place…
Vuyo: So how did you then lose the government’s
support, what happened in that space?
Kobus: Vuyo that is a very good question which I
don’t really have the answer to. I think
it is a question of… well as the IDC said at a number of meetings: It is fine
to put it in the Industrial Policy Action Plan, it is fine to say the right
words, but you actually have to write it into the national development plan,
you have to actually put your money where your mouth is in a sense, there needs
to be a budget item on the national budget to say that is what we are going to
do. We’ve for instance, to back that up,
we worked out a very detailed employment plan of the sort of employment this
would lead to which would be very very substantial. So all of those things were in place, but the
fact is in the end it was never put into the national development plan, it was
never capitalized to the extent needed and that essentially was the end of it.
Vuyo: Yeah…The number to call is 0891104207. Were you very disappointed with its demise?
Kobus: Yeah, it’s impossible to express my
disappointment in words, I tell you…
Vuyo: Yeah…
Kobus: Because I think, you know SA has a track
record of doing fantastic things on the technological front and unfortunately
also a track record of not commercialising their own things. We tend to commercialize imported products
under licence, we tend to sell our innovations to be commercialized in another
place and I… and we really saw this opportunity to say look we have a very
strong car industry, it is one of our top 5 at least, export products. So we know how to make stuff, we know how to
make stuff to export quality to world class quality, we know how to design and
develop stuff, many many examples of that, but we have never married our
ability to design and develop to our ability to produce world class goods and
this was a real opportunity to do this.
Vuyo: Yeah… OK.
I get this. Kobus Meiring, we are talking about SA’s electric car, its
history, what has happened to it, you may have some thoughts. Is this in your view a missed
opportunity? What are your thoughts?
Give us a call at 0891104207. Would you like to tweet? Well we are accessible
that way we are @Mbulivuyo and @SAFMradio.
You are also welcome to send us a text message at 34701. This is SAFM
Morning Talk. SAFM is as you know SA’s
news and information leader.
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Morning
Talk on SAFM:
Vuyo: SA’s news and information leader. Let’s hear from Roels… is it Roels or Roelf?
Roelf: Roelf.
Vuyo: Hello Roelf.
Welkom.
Roelf: Hello. Hoe gaan dit? (LAUGHS)
Vuyo: Goed, self?
Roelf: Hello Vuyo.
Vuyo: Hello.
Roelf: Kobus…
morning. You sound tired and you sound gatvol but I can understand it
completely. I think this is a highly
missed opportunity. One just wonders if
it is not the same thing that happened with the, what’s the car they had in
America, the Volt or what was it called?
Kobus: Yeah the original one was the
GM.. the EV1, from some 20 years ago.
Roelf: Yeah. One
just can’t help to think that maybe it is the same thing that happened there - that it was bought out by government or
stopped being supported by government because they are going to lose so much in
the fuel taxes that they are making.
Anyway the only thing I wanted to say to you is that I feel sorry for
it, we were really looking forward to something that … that exciting coming
from SA, so … best of luck mate. Thanks
Vuyo, thanks for your programme.
Vuyo: OK thanks Roelf.
Roelf: OK.
Vuyo: OK.
Kobus?
Kobus: Yes, I think it is an interesting comment and
it’s one that we’ve heard before and maybe there is some truth in it, but it’s
just that you don’t want to get into a conspiracy theory conversation. The fact is that there were many supporters
but there were also a number of groupings that would not support something such
as this. And if you take the motor
industry as it is in SA today…it is completely foreign- owned, it is I think
probably in terms of manufactured goods second of our major export earners so
it is a very strategic asset for this country and the motor industry certainly
has a very very strong voice in terms of what the government does and does not
do…
Vuyo: How far were we from manufacturing the car,
exporting it… two years, three years, five years?
Kobus: We had a very very detailed industrialization
plan which would take us… I think about 40… just over 40 months from…and that
would include setting up a brand new plant.
If you could move into an existing plant, you could cut some time off
that. We had exhibited the car in Paris
and Geneva before to very very good response.
We had some very good international motor journalist response and
write-ups about the car. The strategy from day one was that we would
essentially start exporting the moment the car runs of the line. The SA car market is a very interesting
market place and a very difficult market place in the sense that of any
specific vehicle not that many are sold, although many cars are sold – over
half a million cars are sold. But you need
to sell about 50 000 of anything in the non-exotic sort of class, to make it
worth your while. Of course if you go to
Ferraris and Porches you can sell much less and still make it viable. But 50 000 vehicles a year of any specific
type and model does not happen in this country and if it does happen it might
happen to one or two brands in one model.
So to make a business like this viable you have to do export from day
one and our whole marketing philosophy and strategy was to test the export
market very early to make sure that we aimed the car at the right market and to
test acceptance of that market and I think in both of those instances we had a
tick in the box that we were on the right road.
Vuyo: OK. Let’s hear from Brady in East London. Hello Brady.
Keith: Hi Vuyo, its Keith here. I am just a little confused. Earlier this week we heard you had one of our
ministers on the programme, lauding the merits of this motor car, how many jobs
it is going to create and feeding down-time for the spares to be made etcetera
and now you are telling me it is not a project anymore?
Vuyo: Yeah, we were talking about when he was
minister – Musibudi Mangena – he was championing this particular initiative
among other things and now we are just reflecting back on the work that had
been done up to and including the point when they just had to give up on it.
And Kobus is the CEO of the company that…
Keith: Oh, so you’re saying the programme earlier in
the week was a delayed programme from some time ago?
Vuyo: No, the programme earlier in the week, we
were talking about him receiving one of the presidential awards and then we
were reflecting on some of the work that he did when he was minister of Science
and Technology and one of the things that he did was work with Kobus Meiring…
Keith: Oh.
The way it came across to me, maybe I was listening with the left ear
instead of the right ear that that was a going programme that it was almost
about to be launched… I was a bit confused…
Vuyo: Oh OK. No, no. Glad to have been able to clear
that up for you Brady.
Keith: (LAUGHS) Thank you very much.
Vuyo: Thank you very much Brady in East London. Dave is also in East London in the Eastern
Cape, hello Dave.
Dave: Good morning Vuyo and good morning Kobus. Indeed, Dave from East London, I am in
business here and Kobus, first of all we in the business environment here
commend you for all the hard work and pioneering efforts you guys made in
Optimal Energy to get as close as you did.
I guess you must be discouraged, but take heart, that you had a lot of
supporters here and you still do.
Kobus: Thank you very much.
Dave: Just one question I want to ask you: Do you
think the window of opportunity has now closed in terms of the development of
electric cars like the Nissan Leaf or whichever one is at the head of the game
now or is that window still slightly open for us?
Kobus: I think the window is still open. The car business is not one that… the winner
takes all. It is a business with quite a
number of players, yes there is always consolidation taking place, but there
are a number of players and if you look at the cars out there today, not the
electric cars but just the internal combustion engine cars, there is little to
choose between one car and the next in terms of any specific unique selling
proposition or unique technological feature or anything like that. And our whole aim was to say look we are not
going to have the first electric car, there will be others, so what we have to
do is we have to be competitive and we have to make sure that we stay competitive
at all times. So from the point of view
of having a competitive product that we can put on the market and if maybe in a
year or two we can make sure that we catch up and it is still competitive, absolutely.
So from that point of view I think it is
certainly doable, I don’t think that window has closed. I think the window in fact for electric
vehicles has in a sense opened slower than what some people had forecast, I
think if you look at Nissan Leaf for instance, yes they are selling all over
the world, but it hasn’t happened as quickly as people had thought. The oil price has sort of got stuck at around
100 dollars at the moment a little bit up a little bit down and people are
lulled into saying well, you know at that level I can… I am happy. But the point is if you look at the long term
forecast of where the oil price is going, of where global warming is going, all
of these, I think the electric car is just inevitable, you are not going to
stop it, it is a question of what is the best time to start and what is the
best way to approach it.
Vuyo: All right. Dave?
Dave: All right just, listen I won’t comment and I
won’t keep you long but I know your technology in terms of battery power must
have been very advanced. It appears that
even Boeing could not find a decent supplier of batteries for their Dreamliner,
maybe that is an opportunity for you guys.
Kobus: Yeah, that is a very interesting one on the
Dreamliner that we followed closely. Our
batteries were lithium based and the Leaf’s batteries are lithium based and the
Renault Fluent’s batteries are lithium based.
Your cell phone, your lap top, all of these things are lithium based. The Dreamliner had lithium based batteries
and they ran into trouble and I think the quickest solution to a problem - and you know when a problem happens on a
production line it is quite different from when a it happens during development
when you have a little bit of time to try and resolve it. So their quickest and safest solution was to
go back to the previous technology battery on the Dreamliner. But I have no doubt that given another few
years they are going to be back with lithium because it is by far the highest
energy content battery around and if you need it to give you distance like in a
car then that is what you need. So people
like Toyota like Nissan like Renault have done a tremendous amount of work on
proving the safety and homologating lithium type batteries and we were
basically to some extent all these lithium batteries go back, boil down to
similar sort of chemistry and that is what we were utilizing.
Vuyo: OK. Just looking at what some of our
listeners are talking about on the text message line: this one asks, “Why was
the Joule not exhibited at motor shows in SA?
Kobus: Yes, we were… in 20… when was the…2011, the
Johannesburg International Motor Show. We were planning to go, we had a stand
allocated to us and I think if anybody still has a copy of the show catalogue
you can see our name there. But it was decided
by our shareholders not to go at the very last moment …
Vuyo: Why?
Kobus: (PAUSE)
Vuyo…I am not a hundred percent sure. We
did go to COP17 two or three months later.
We were under severe financial pressure at the time. It was certainly not a unanimous decision not
to go, but unfortunately we did not go.
Vuyo: OK.
“And government will definitely kill the electric car, will lose too
much money in petrol tax the project has been bought.” This is Marcus in PE
that is the theory you have been talking about earlier as well and then “Do you
think the fact that the power changed hands all the time in government
organizations supporting the Joule was one of the problems?” Do you think the change
of power was one of the problems, Kobus?
Kobus: To some extent yes. Just before minister Mangena left and it was
said the other day as well, he was not an ANC minister. But just before he left an inter-ministerial committee
was announced specifically to support the commercialization of the electric
car. And that we thought was a very important break-through because it took it
out of the hands of just one champion who might or might not make it through to
the next round…
Vuyo: (LAUGHS) Yeah…
Kobus: … and give it a broader sort of support. But unfortunately I think that just came too
late and that inter-ministerial committee never… it was announced, it was in
the paper and it was gazetted, but it was never… I don’t think it ever really
came into function. So yes, I think that
hand-over probably had a very big effect.
Vuyo: Yeah.
Just two things: There was no option of listing… because of the work
that you had already done and the potential that was there… there was no
opportunity of listing the company?
Kobus: Vuyo, no, not in the SA context. I think if you look at the Canadian sort of
start-up listing possibilities we could qualify for that but we could not
qualify for listing under the SA rules of listing because we were not trading
yet and that precluded that.
Vuyo: OK. And
then of taking it to South Africans, I mean the guys calling in saying you had
a lot of support – there was no opportunity of taking it to South Africans and getting
them to be… perhaps the people who galvanize the process and support it and
fund it in some way?
Kobus: We thought a lot about that. But you are talking about a substantial
amount of money and you need to do that in a very very organized way, like
listing - listing is a way to sort of do that in a properly controlled
manner. To do that outside of formally
listing it, I would not say it is not doable, but it is… we did not see that as
being within our possibility of getting that right.
Vuyo: OK. Stay with us Kobus, we will talk to you
some more after the news headlines at 11.30.
News.
Vuyo: If you would like to call in, we are talking
about the Joule that is the electric car that was being developed here in SA,
was being developed, is it not being developed anymore. Our guest is Kobus Meiring, the CEO of the
company that was driving this initiative.
Kobus so, all of the research and other elements donated to the Nelson
Mandela Metropolitan University… to do what with it? Is it housed in a museum,
do you know what is being done with all this content, knowledge and
information?
Kobus: Vuyo, no unfortunately I am not completely up
to speed with what is happening there – I know there was a launch about a month
ago, maybe two months ago of an electric vehicle charging infrastructure
project at which there was at least one Joule, I don’t know how many there
were, there was certainly also a Nissan Leaf.
Interestingly enough there was a big launch at Gerotek beginning of the
year by the Department of I think Environmental Affairs, which was called
“South Africa’s Electric Car” which turned out to be also a Nissan Leaf. So… no, I do not know what Nelson Mandela
Metropolitan University is doing with it, I assume they are using it for
educational research and so on.
Vuyo: Yeah.
There is no way of coming back to a project like this in your view? With
your knowledge, expertise and you know, project management skill?
Kobus: Well, I think speaking for myself and for
everybody, really for every single person that was involved in the project this
was absolutely the dream that we were trying to do and people were trying to
realise and people were and still are very passionate about making this
work. So if somebody today said, look,
we had a new think about this and we want to do it and if you guys want to take
part in it… even if it is in a different form or manner or so on, I think you’d
find a surprisingly large amount of people saying yes, we want to do this
because we think it can work. And I
think it is a mixture of interesting engineering work, interesting commercial
work and also the fact that we are doing it in SA. We really often tend to think that we cannot
do things in SA and unfortunately that Afro-pessimism thing is still very much
with us.
Vuyo: How many people were working on this project,
how many engineers?
Kobus: I think at the height we were about 120 people,
of which about 80 or 90 were engineers, so a substantial amount of engineers
under one roof. And it was actually
interesting and to some extent scary at the time that in Cape Town where we
were based, we were regarded as one of the bigger engineering companies. We had more engineers under one roof than
just about anybody else this side of the Orange River. That is not counting civil engineering
companies who are specifically focused on building and civil works like
that. But a multi-disciplinary
engineering thing… there are not that many of them around…
Vuyo: Yeah. 0891104207 Let’s tell you Kobus what people are saying
again on the text message lines: “I imagine…” No. “Technically it is still
behind - minimum 500km range, speed, availability of electricity, these are
challenges to overcome, 200km between charging is an issue” Is that where you
were – 500 km between charging or was it 200km between charging?
Kobus: One of the biggest differences between our
car and some of the other cars is that we said we don’t know what will be the
best battery configuration, either chemically, physically or from a range
perspective, which ones the customers really want, so we came up with the
biggest and most versatile battery space as a lot. So we could in fact fit a battery in there
that could give you the 500km range. Our market research said that it would
probably not really be what the customers wanted. And we ended up with a battery that gave you
about 250km range on the new European drive cycle. Because if you analyse what people… how they
drive, where they drive to and you say, well this would initially be aimed as a
city vehicle in many instances as a second vehicle, to do 250km a day would
mean you could live in Pretoria, work in Jhb, drive around, go back home and
still be very comfortable by either charging that night or maybe even only
charging the next day. So this whole
paradigm of going to the garage and filling up just falls away. We think we need to do 500 or 600km on a tank,
which you do because it is a hassle to go to the garage, but it is not really a
hassle to plug in your lap top or your cell phone or your tooth brush or
whatever and that is really the paradigm shift that needs to be made.
Vuyo: OK.
Mzwandile lives in Jhb, let’s hear what he’s got to say. Mzwandile good
morning.
Mzwandile: Brother how are you?
Vuyo: Ah, ek is nxha, outie, hoe lyk dit?
Mzwandile: Ek is goed, man.
Vuyo: Eh, Tata.
Mzwandile: Look Brother I don’t know if I have heard
correctly – that the project has been canned?
Vuyo: Yes, you’ve heard it correctly.
Mzwandile: OK so now what I want to know: What about the
money that was spent on the project? Because one look at that project and look
at it with pride with what we are going to do with it as a country… as the
professor has just said, the car was a car that was going to be used probably
inter-city – Jhb to Pretoria, probably from Jhb you can go to Mangaung
(inaudible) and stuff like that. So who
canned it and what was the reason behind it? Because one look at this and look
at it politically it seems somehow we were bulldozed by the oil companies
because once you come up with something that will not require oil and stuff
like that, you will be bulldozed, especially with us as a country, we are a
small country with no power and we can easily be bulldozed. But looking at it - China has the same things
that are happening, I remember I was in China and most of the bikes there were
running on electricity.
Vuyo: Yeah. OK.
So Kobus, were you bulldozed by the energy companies?
Kobus: Sorry Vuyo, you just broke up
there. Could you just repeat it?
Vuyo: Were you bulldozed by the energy companies, by
the oil companies in particular?
Kobus: No, no we were not. And I think there are two
reasons for this. The one is that I
don’t think there will ever be a precipitous change from oil to electricity, it
is going to be a gradual thing, we are never going to run out of petrol as
such, it is just going to become more and more expensive. Global warming is going to become more and
more of an issue, but it is not going to be an overnight sort of thing. So that
is the one side of it the other side of it is I think what we were trying to do
was really difficult, it was a challenge, so you essentially don’t need to try
to stop something like that, you could just stop supporting something like that
and it will also stop. And I think to a
large extent this is what happened here.
I don’t think there was any, you know, sort of positive undermining of
what we were trying to do, maybe one or two small exceptions, but in general
not. But if you don’t put the right
amount of support at all levels into something like this, it will just not take
off the ground. You need to put a lot of
energy into something to get it to fly.
So we went through a stage where we said it feels as if we built an
aeroplane, we’ve fuelled it up, we are ready, we are at the beginning of the
runway, we are starting to roll. But
because the powers that be don’t have the necessary confidence, they say well
look, OK you can start running down the runway but don’t go too fast and what
that implies is that you can never take off.
You are going to run out of runway at some point, but you are never
going to take off and you are never going to know if you could have taken off.
Vuyo: OK. “We
heard that Malaysia was interested in the car” this from Jane, was Malaysia
interested in the car?
Kobus: Sorry, just repeat that?
Vuyo: Jane
says she heard that Malaysia was interested in the car?
Kobus: Oh, Malaysia. Yes, we actually had a large delegation from Malaysia
here who drove the cars and so on, on the very day that we closed down the
company. We have tried to keep the
conversation with Malaysia going via the DST because the DST in a sense is the
over-arching owner of this. And it has
been hard to really build up momentum there and that is more than a year ago
now. So there have been sporadic
conversations with the Malaysians since, but once again it is one of those things
where you don’t need to kill it, it will die by itself if you don’t feed it
enough.
Vuyo: All
right. “This is a good idea says Modise in Mafikeng. “ We’ve got another sort
of four or five minutes to talk. Let me
just take this break, Kobus and then I’ll talk to you – we’ll just talk about
engineering and some of the knowledge that was cultivated during this period. We’ll be back in a moment.
Kobus: All right.
Advertisement.
Vuyo: All right.
Just finally Kobus, talk a little bit about the
engineering-learning. I mean would you
say that as far as motoring engineering, motor car engineering is concerned we
have really moved significantly because of that project?
Kobus: Yes I certainly think we did. When we started and we wanted to employ
people with automotive experience, they were just not existent. Because, yes, there were people involved in
the car factories in SA but those car factories are making cars to somebody
else’s design. And the automotive
development work in SA has been limited to doing maybe suspension for local
conditions or radiators for local conditions, air conditioners for local
conditions, that sort of thing. A basic from the ground up automotive design
development in this country has not been done at this level at all. There were some racing car constructors,
notably a guy like Owen Ashley in Cape Town who was doing design from the
ground up – very very knowledgeable. But
we literally took clever engineers from all kinds of other backgrounds and
turned them into I think quite a formidable team of automotive engineers by the
end of the project.
Vuyo:
Yeah. It has been a pleasure
chatting to you, thank you so much for your time and thanks for the innovation,
I think it is quite an inspiring story.
Kobus: Thank you very much, I appreciate it.
Vuyo: Thank you very much Kobus Meiring. We were talking about the Joule, the car the
country was developing but we are not developing it any more. Thank you very much for the moments Kobus
Meiring.
