Trucking fleets ‘really want to move to electrification,’ Hyliion CEO says

Hyliion CEO Thomas Healy speaks with Yahoo Finance's Brian Sozzi and Julie Hyman about what it's like to drive a hybrid Hypertruck and why the future of long-haul trucking may be electric.

Video Transcript

BRIAN SOZZI: Electric powertrain player Hyliion is eyeing commercialization of its products next year, as it seeks to deliver Hypertrucks to the likes of Penske and Ryder. Let's check in on the company's progress with highly on founder and CEO Thomas Healy.

Tom, it's good to see you and good to see that hyper truck behind you. It's my understanding that you have actually had Wall Street analysts out there, to your headquarters, to test drive these trucks. How's that going?

THOMAS HEALY: It's been going great. So a few weeks ago, we announced we were kicking off a road show, where we were taking the Hypertruck technology that so many of you have heard about and actually letting people experience it firsthand. Not only were we getting fleets down here to actually get behind the wheel and drive the truck, but as you just mentioned, we had Wall Street down here, we had our sell-side analysts and let them actually experience it firsthand.

And what we did is we put them in a diesel truck first and then we put them in the electric semi. And it's a game-changer, people walk out of the truck smiling ear to ear and just realizing how much of an impact a vehicle like this can have.

BRIAN SOZZI: You have to text me one of those videos. I can't envision some Wall Street analysts leaving their Excel spreadsheets and driving a semi-truck, but I'll take your word for it. Talk to us about that driving experience, Thomas, how is it different compared to those diesel trucks?

THOMAS HEALY: So Brian, it's very similar to going from a gasoline car to an electric car. You have instant torque, the vehicle is quiet, it's a really smooth driving experience. And one of the things that people don't realize about semI-trucks is going from like 0 to 15 miles an hour, you'll actually shift like, five gears just to get to that slow speed. Versus with an electric semi-truck, it's instant torque and it's smooth.

And so I think probably the thing that sums it up is we had people in the front seat and then we were sitting in the back. And the people in the back of the truck were kind of like falling back in their seats because of the acceleration that this vehicle has, which is unlike a diesel truck, which takes a lot of time to get to 60 miles an hour.

JULIE HYMAN: Hey, it's Julie here. So you guys, just to be clear here, you guys make the power trains? So you don't make the cladding, I guess, of the truck, right? You make what makes the truck go, do I have that right?

THOMAS HEALY: That's absolutely right. So the vehicle behind me here, it's a Peterbilt truck, but then it has a Hyliion powertrain in it. Which, we actually see as one of our advantages, because we're not trying to rebuild the whole truck. We're not trying to set up a multi-hundreds of million dollar manufacturing plant for building trucks. We're doing the powertrain and then working with others in the space to actually deploy it in their trucks, to deliver it to fleets.

JULIE HYMAN: OK so, when is that part happening? Where are you on that path to seeing more of these trucks on the road and seeing them move goods around the country?

THOMAS HEALY: So with the Hypertruck, we are in the thick of commercialization right now. And as one of the stages of commercialization, you actually want to get people in the vehicle, get their feedback, and see how the truck performs. And that's what we're doing right now.

As we go into 2022, is when we'll actually start doing controlled fleet trials, where we'll be deploying assets in fleets operations and pulling real world freight. Now with that being said, we already have a hybrid product that we're deployed and commercialized and getting it into fleet operations, as we speak. We already have millions of miles of on-road validation of that product out there. So electrification is real, but we've got a lot more coming over the years ahead here.

BRIAN SOZZI: Thomas, you have a lot of hucksters in your industry. And I'm looking right at the folks at Lordstown. Looking right at Nikola, I'll say it so you don't have to. But is the hype out of some of these companies hurting your ability to just advance your mission forward?

THOMAS HEALY: So there's actually been a big positive that has come out of it, that we've seen. Which is the fleets that we're engaging with, you know some of those Hypertuck innovation council members, like the Ryder's Penske's Anheuser-Busch's of the world. What we've seen is they really want to dive in and get a better understanding of who we are, how the technology works, and making sure that it's real. And so we've actually seen the level of engagement from fleets increase, as they want to really understand our product better.

And that's where we see that we have a big competitive differentiation. Because a lot of the technologies that have been spoken about, whether it's hydrogen fuel cell or BEV plug-in to the grid. They have issues where their operating costs are going to actually be more than diesel trucks, in many instances. Versus one of the big competitive differentiators for us is that we're an electric truck, but as opposed to needing to plug into the grid, we actually use natural gas on board the vehicle to recharge the batteries as you're driving.

So with that, we have infrastructure already in place all across the US, for natural gas refueling that we can leverage. And our operating costs will actually be less than diesel, over the life of the vehicle. So from that standpoint, not only do we bring fleets emission benefits, we also bring them a reduced operating costs, which makes it really easy for them to adopt.

BRIAN SOZZI: I've seen a couple of folks on the sell side, Thomas, talk about a new natural gas engine out of your competitor, Cummins. How big a threat is it?

THOMAS HEALY: So we do see it as a competitive threat for our hybrid product. But for the Hypertruck, we don't really see it as a deterrent from fleets. I mean, what we're seeing is fleets really want to move to electrification. And they see the Hypertruck as a way to get to an electric powertrain, but use the benefits that are already in place for renewable natural gas and natural gas that's out there.

So we don't see that it's going to really deter the volume adoption of the Hypertruck, especially when we're looking at some of the regulatory pushes that are going on, which are moved to electric drive systems, be able to drive on zero emissions. So no tailpipe pollution at all, in certain areas. And those are some of the benefits that a vehicle like the Hypertruck can pull forward that a conventional natural gas truck would not be able to.

JULIE HYMAN: Thomas, I was looking at your stock chart. And unfortunately for you, it's not a great looking chart. Either over the past month, or over a little bit of the longer term. And I hear you talking about doing this work here, to get your message out to the Wall Street community. What's been the feedback and what do you think is going to help turn the stock around here?

THOMAS HEALY: Yes. And no doubt, over the past year, I mean, there's been a lot of excitement in electrification. And while we still see a tremendous amount of interest in electrification, people are trying to figure out what solution is really going to win. We've seen a lot of companies come to market saying that they're going to revolutionize with new EV powertrain technology or truck technology. But I think for investors, they want to know, well who's really going to win this race.

And that's where we see that we've got a pretty strong competitive differentiation. And to your question of what's going to set us apart, what's going to really kind of move us away from that pack. I think it's showing that level of fleet interest, showing that this is a powertrain technology that fleets can realistically and practically adopt in their operations. And it can ultimately be that powertrain of choice for them.

So that customer engagement is critical. And then having that differentiation where, we're not sitting here saying we need to have others go build out hydrogen infrastructure to get to a point where we can deliver our trucks. We're sitting here, today, saying the infrastructure is already out there, now it's really a stage of we develop and deploy this truck and fleets can start adopting it and using it in their operations, today. And not being reliant on others to go build out things like infrastructure recharging, hydrogen fuel cell stations, things like that.

BRIAN SOZZI: Real quick, before I let you go, Thomas. What's the 0 to 60 time in that truck behind you?

THOMAS HEALY: [LAUGHS] So we haven't put out the exact number yet. But it is much faster than a diesel truck. I was actually just in the truck the other day, out on the highway, and one of the really neat things is that you come on to an on ramp, you're getting on the highway, you're merging in at highway speeds, which is unheard of for a conventional diesel truck, right?

Normally, you see a semi-truck getting on the road there, at least 20, 30 miles an hour slower than the traffic that's moving down the highway. Versus we're merging in right at highway speeds, which will also bring a big factor of safety forward with this vehicle as well. Reducing accidents and making it easier and safer for the driver to be able to do their day in and day out jobs.

BRIAN SOZZI: Well, if I see one of those Hypertrucks trying to merge next to me, I'm getting the hell out of the way. Hyliion founder and CEO, Thomas Healy, good to see you. Good luck in the year ahead, we'll talk to you soon.