Ryder System, Inc. (R) Earnings Call Transcript & Summary

So why don't we get started. Welcome, everyone. I see we've got around over 300 folks on the line and growing by the second. So welcome all to our first webinar, public webinar from Autotech Ventures. Good morning or good evening, wherever you may be dialing in from around the world. This is the Moving Us Together webinar. And I'm Quin Garcia, the Managing Director of Autotech Ventures, and I'll be your host and your moderator for today's event. We pulled this together because we saw that overall use of transportation has dropped dramatically over the past months with all of us staying at home. And as we restart our economies, there's going to be many new transportation problems to solve. So as we were thinking about this, we said, oh, why don't we host a public webinar with some of the world's leading transportation minds, so you see here on our panel, with the hope that hearing them and their views on what's happening out there in the world today can inspire entrepreneurs and corporations and investors to move together and use technology and use innovation to solve the global transport problems that have emerged in just these past few crazy months that we're all living in right now. So today is this, as I mentioned, this is the first Autotech webinar that we've opened to the public. So hopefully, we don't screw this up too badly. And hopefully, no one decides to Zoom-bomb us along the way. So given this is our first public webinar, we've taken some extra precautions around background noise. So don't be alarmed if you hear something that sounds like my cat trapped in the closet in the other room. I want to thank our amazing Mitra Broomand who organized this and who gets the credit if this goes well. And if it goes awry, then we can blame Zoom for poor security features or something. And logistical notes, so if all goes well, then Mitra is going to send you all a link with the recording of today's webinar. And we'd love it if you can share it on your social media and with your friends and colleagues and whoever may enjoy it. On the other hand, if today's webinar is a mess, then we're not going to be sending you the recording and we're going to pretend that today never happened at all. So fair enough. So let's get started. So for those of you who don't know much about Autotech Ventures, I'm just going to spend a few minutes showing you a few slides about why we're doing this and the transport tech domains that we, as a firm, are most excited about. And then we can start the panel with these amazing transport execs who've joined us today. So let me just pull up a few slides for you here and we can get rolling. Hopefully, you all can see now that I'm sharing screen here. And as I mentioned, we're a VC firm that's enabling the future of mobility and transport. We, as a firm, are a bunch of transportation executives, transportation entrepreneurs and venture capitalists. We invest only in ground transportation start-ups, so nothing that flies, nothing that floats. Movement of people and goods along the surface of the Earth is our scope. And behind us and together with us, we have the world's largest group of transportation investors, transportation LPs, so #1, #2 corporation from pretty much every segment of the transportation value chain as investors with us. Some of them have been publicly announced and many exited transportation entrepreneurs, elite transportation executives, transportation families, right? So anyone who's really passionate about transportation is partnered with our firm. And we view ourselves as a bridge between transportation start-ups on one hand and large corporations on the other in the sense that we provide transport start-ups with not only capital but also access to large corporations to help scale their solution. And on the other hand, we're helping large transport corporations to engage with start-up companies as their innovation partners to scale new technologies and solutions. In terms of the trends that we're most excited about as a firm, so I'm sure a lot of you have heard of this ACES construct or CASE, right? So we actually add a D on the end of that so we call it CASED: connectivity, autonomy, shared use, electrification and then what we call digitization. And the digitization might be a little bit less obvious. And digitization is essentially Industry 4.0 or e-commerce. So using IT to streamline a transportation corporation's operations, whether it be internal operations related to manufacturing or logistics or otherwise or external operations, meaning e-commerce, so engaging with that corporation's suppliers or customers. And then digging deeper into some of these domains that we're excited about, it's really all the biggest pain points related to movement of people and goods along roads, right? So if you think about painful experiences that you've had as a consumer of transportation or in a business setting. So all these verbs that you see here on the screen. So how do you automate vehicles? How do you manufacture them? How do you sell them? How do you finance them, insure them, repair them, share them, right, so all these verbs. And we're really vehicle-agnostic. We see transport problems regardless of the type of vehicle we're talking about. So this could be a bicycle. It could be a scooter, a tuk-tuk, car, truck, bus, motorcycle, farm tractor, right? So there's transport problems that kind of transcend vehicle form factor and we're passionate about all of those. And in terms of our investment strategy within ground transportation, so we look at a variety of different business models, and they're primarily in software and services but we also do some capital-light hardware investing. So those business models can take the form of marketplaces. We actually have the world's leading marketplace-focused conference coming up just next week on the 27th and the 28th, for those of you who are passionate about transportation marketplaces. We do SaaS. We do licensing, embedded software. And we're primarily an early-stage investor but we can do opportunistically some mid-stage investments. We primarily invest in North America but we've also invested in other regions, and we will continue to, so Middle East, Europe, Asia and elsewhere. And part of the reason why we wanted to do this right now is because great start-ups are founded during recession years, right? So we've pretty much entered a recession that may last a few years depending on your perspective. And if you look back at the last recession that we were in, some pretty phenomenal companies were founded that you can see here on this slide. And then if you look back even further at prior recessions, over the past, let's say, century or so, there are also many other phenomenal companies that were formed then. So despite all the struggles that society is having right now, this is actually a great time to form one of the next great start-up companies. So let me share with you just a couple of companies in our portfolio that we got pretty excited about when we heard about the initiatives that they're undertaking to solve some of these transport problems that have emerged as a result of COVID. First one here is Cogniac, which is a visual inspection tool for industrial applications. So they basically use computer vision and AI to automatically detect things that are in the field of view of a camera. And they've recently established a new offering to help industrial businesses, whether it be auto manufacturers in their plants or operators of logistics facilities, to use cameras to detect people and see whether people are wearing PPE, masks or otherwise and whether people are maintaining social distancing to try to promote and maintain safety inside these facilities that we're trying to get back to work. We also invested into a company called Fixico. And Fixico historically has been an online marketplace for cosmetic auto body repair. So it's a marketplace to help pair up people who have dings in their car and fleets and insurance companies who have claims to manage together with repair shops who can fix those dings and dents and bruises, right? But when Fixico saw that essentially the taxi industry and rideshare industry had been shut down due to COVID, they innovated and they created this shield that's now being installed by body shops all around the world to seal off the driver of a taxi or rideshare vehicle from the passengers in the backseat to make everyone feel a little bit more comfortable. We also invested into a company called Digital Motors. And as a result of COVID, a lot of dealerships around the world have unfortunately been shut down for public health safety reasons. And so a lot of these auto dealers are trying to find ways to sell cars online to give kind of a Carvana-like experience or a Tesla-like experience or an Amazon-like experience, allowing consumers to shop for cars online. So Digital Motors is actually helping to facilitate that digital auto retailing experience. And last but not least, we invested into a company called Bluedot, which is a company that provides a geolocation solution that allows for contactless pickup of goods or drive-thrus and tolling. So if you think about the growth in, for example, in driving through and picking up your Starbucks through a drive-thru window instead of going in or drive-thru windows at McDonald's or now you have even drive-thru COVID testing. And tolling actually, rather than handing over cash to a toll operator, hey, let's use smartphones in order to actually make that payment. So Bluedot is kind of playing their part as well. So with that, I want to suggest that we all get moving to the next part of our event today. And so hopefully, I have to stop sharing our screen and we can get rolling. Okay. So now that we're done with my shameless plug for Autotech Ventures, let's introduce our panelists. So many of you already know our panelists, but I'm just going to ask each of our panelists to provide a few sentences to introduce yourselves and a curveball for you. I want to ask that each of our panelists, please share just one interesting thing that you have discovered about being locked up in your home for the past months. So why don't we get started with Thierry Bolloré.

Hello, and good morning and good evening to everyone. So I'm Thierry Bolloré. I'm the former CEO of Groupe Renault. And one very interesting thing I've discovered during this time at home is really that I could not imagine that we could be as occupied as everyone has experimented according to many contacts I've had and as efficient as well by working from home. And I think this might be part of an element of our discussion in the coming minutes.

Thank you, Thierry. And next, Carl-Peter.

Yes. Hello to everyone. I'm an old automotive hand, had a career with BMW in manufacturing and went on to General Motors as President of General Motors Europe, then went on as CEO of Tata Motors, including Jaguar Land Rover. The last 8 years, I spent a lot of time with the Geely Group. I was on the Board of Volvo and a senior adviser to the founder. So what did I find out? How refreshing it is to have a solid 7-hour sleep almost every night.

Consistent sleep. Thank you, Carl-Peter. Steve?

All right. Good morning, good evening. Steve Sensing, I'm President of Ryder Supply Chain Solutions. We have operations primarily in North America serving across multiple industry vertical groups like automotive, industrial, technology and CPG. The interesting thing for me is, I've kind of worked from home remotely, but I found myself, after 20 years, I've been home now for 60 days and I'm still married. So that's an amazing feat here so, but thanks for having me.

Thank you, Steve. Anthony?

Hi, everybody. I'm Anthony Foxx. I am currently the Chief Policy Officer at Lyft, but before that and probably one other way you might know me is I was the U.S. Transportation Secretary in the second term of the Obama administration. So in terms of what I've learned, having been locked in for a while, I'm learning new things. I've taken the opportunity to try to find out the outer edges of how much I can learn during this period. So I'm taking up a language, trying to teach myself an instrument and we'll see how far I go before things open up.

What language are you working on?

You'll never guess it, Norwegian. How's that?

Okay. Nice. And Lea?

Fantastic. Thank you. Great to be here today. I lead research and development for Cox Automotive Mobility. I've been with Cox Automotive about 10 years in different roles. And part of what I look forward to sharing today is our passion for what we describe as the ACES feature of transportation. And the most interesting thing about, I guess, the work from home is, I'm starting to like it. I never thought I'd say that. And the question has turned to, what will it be like when we're all asked to go back to work and commute and get dressed up and travel again? It's reshaping everything.

Yes. Thank you, Lea. So thanks, everyone, for the intro. So I just see we now have over 500 folks on the call right now, so welcome to those of you who've just joined. So why don't we dive in and talk about some of these transport challenges?

Maybe we can start by talking a bit about ground logistics. And maybe we can start with chatting with Steve here, if you don't mind. So Steve, how has the ground logistics sector been impacted in North America since the pandemic started here? There's obviously been a lot of news out there around last-mile delivery automation and supply chains reshuffling and long-haul trucking. So can you just kind of set the stage for us on what you're seeing out there?

Yes. As I said before, we're serving in across multiple industry verticals. So it's been really a dynamic time for us over the last 60, 75 days. As you can imagine, automotive basically came to a halt in early April. And then conversely, CPG, food and beverage was really just booming and seeing volumes 2x of what we normally had. So I think some of the innovation and creativity here was that with our balance and diversity in our portfolio, we were able to redirect some of those resources that were idled and moved them into pop-up fleets. So really servicing the frontline, the food and beverage industry with dedicated pop-up fleets. So it was quite interesting there to have automotive individuals servicing food and beverage so a pretty interesting time for us.

And what do you mean by pop-up fleets?

Well, where normally you would be using truckload carriers and LTL carriers. As you can imagine, in some of those situations, capacity was extremely tight. And so we would move those resources, assets, both tractors, trailers, straight trucks and the associated driver into a different geography and be able to serve our customers with that capacity.

Got you. Got you. And so within our firm, we think a lot about, what are the headwinds and what are the tailwinds that are facing a given technology or a given business model and innovation in the transport space. So when you think about headwinds and tailwinds in ground logistics, which logistics innovation, would you say, have been delayed as a result of COVID, so that's the headwind, and which have been maybe accelerated via some tailwinds?

From our perspective, I don't really see anything being delayed. Times like this, when you're in a disruptive economy, it really breeds innovation. I'd say that from our perspective, 2 insights that I can provide for you is, in your presentation, you talked about the CASE, CASED and you added the D. From a sharing perspective, we created in, right now, 3 geographies, it's called COOP by Ryder. And it's really the first asset-sharing platform. So think of it as Airbnb for tractors, trailers and straight trucks. So if you own an asset, you can put it on our platform. And if I need one, we basically eliminate the friction of that sharing, right, from a transactional standpoint. So we've seen demand pick up in that market. I would say from a last-mile perspective, as all of you would know, e-commerce has just gone through the roof over the last 2 months. I think we're up, in our facilities, almost 300% as far as volume. So really, the need to have the flexibility to be a preferred essential provider, I think, is one of the things that our customers are looking for. So while many retailers were shut down, we had the ability to deliver big and bulky goods to everybody's storefront door. So we continue to serve those retailers through the e-commerce network. So exciting time and I think those will continue from a tailwind perspective. A lot of us won't go back to stores for quite some time, so the need for that e-commerce last-mile capability and asset sharing is going to be critical.

And Steve, can we dig a little bit deeper into e-commerce? So what does a derisked e-commerce logistics network look like in this post-pandemic world that we're all in?

I go back to flexibility, right? I mean, I think as you look at our customers, just having one set of nodes to be able to serve a customer, you've got to have the flexibility to source product from multiple suppliers. You have to have the flexibility to ship product and deliver through an omnichannel network. So we've had a lot of conversations with our customers about doing that for them, again, kind of going back to the essential provider in times like this. And I think as you look over the next 12 months, this thing is going to ebb and flow, and being able to shut down locations and pop-up locations is going to be critical to the economy and to many customers out there.

Yes. And when you say omnichannel, what do you mean by that?

Well, sourcing from multiple points, right? You've got to have the capability to ship product from a 3 DC network or distribution centers, let's say, in the West Coast, East Coast and Midwest. But if you extend out of that, you also need to be able to ship product from a -- if you're a retailer, from a retail store, right? So sourcing it as quick as you can at the lowest cost possible.

So we've got folks dial in from all over the world today, and folks should be able to see the recording of this from around the world for some days after this. So let's kind of step back away from the U.S. for a moment and let's talk a little bit about global logistics kind of change, especially ground logistics. So can you speak, Steve, a little bit about how you see these logistics change shuffling geographically on kind of a global basis as a result of all this craziness that's happening now?

Yes. If you think about it before COVID, I think we were more of a global supply chain across most industries with the exception of food and beverage which are typically sourced regionally. Again, the uncertainty that this has created and the pressure it's put on supply chains, I think you're going to see more regional sourcing. So again, manufacturing within country, within region to be able to respond to demand quicker. So we've seen some of those trends already start, moving back into near-shoring and onshoring. And maybe a little more expensive at the end of the day, maybe carry a little more inventory, but the fact that you're not shutting down your supply chains is the critical piece.

And when you think about the most promising ground logistics innovations that were out there in that pre-COVID world just a few months ago, and you think about the most promising innovations that are going to be coming up over the coming months and years, how has your view changed between those 2 worlds? What's suddenly become extremely important and maybe what's diminished in importance in terms of COVID-19?

Yes. I think, really, for me, it's the quickest delivery possible, so that innovation of crowdsourcing. If you think about parcel shipments and individual shipments going to homes, being able to offer a number of different carriers that can serve the end consumer is going to continue to thrive and I think, innovate. These crowd-sourcing technologies that are out there, I think, is going to be one of the biggest opportunities as we go forward.

Any of our other panelists have comments or opinions on ground logistics and trucking in that world? Okay. So why don't we move on a little bit and let's talk a little bit about urban mobility. Let's talk about ground transport policy as well. And I want to open up this first question to all of our panelists because micro-mobility has been a polarizing topic around the world, so scooters and bike-sharing and these initiatives. So what do you all see in terms of headwinds and tailwinds for micro-mobility?

Well, I guess, I'll start. And just for context, I'm offering opinions on this question from the national perspective but also having previously been a city council member and a mayor of a city. I think in the last 2 or 3 years, micro-mobility has been something of a thorn in the side of a lot of cities. The bikes and scooters piled up on sidewalks, people using them without necessarily having a great sense of safety and all of the dangers inherent in that in a very highly congested urban context. But that said, there's some interesting interplays here with the current pandemic. From a public health standpoint, it could be one of the ways in which people shift away even temporarily from some of our highly congested transit systems to get to and from places. It also holds promise to solve some of the problems I spoke about earlier in terms of companies that find a way to lighten the load on cities from an enforcement and regulatory standpoint by solving the problems of having maybe stations instead of having the bikes and scooters parked on sidewalks and so forth. I think there's also an interesting consolidation happening in the micro-mobility arena that will reward a small number of players that figure these things out. But I think right now the prospects for micro-mobility are actually pretty promising. And whether that holds post pandemic is something yet to be seen. But I think for the next 12 to 18 months, I think there's a really good opportunity for smart folks to partner with transit agencies and with cities to help solve some of the mobility challenges people have and safety challenges.

Just one comment from my side, if I may. I mean, there is a great trend in Europe to use your personal bicycle. And I think this is a huge trend. If you go to a bicycle shop now, they are all completely sold out. And that trend was going on and I think it's now being strengthened and increased. I still do not understand how this then fairly asset-heavy. I mean, you own the assets. How do you ultimately make good return on your invested capital if you factor in losses, damage? It's quite labor-intensive. I'm not so sure whether the business model will ultimately work. That's the one thing I haven't heard good answers on, and I think there's a lot of sort of, call it, testing going on, experimenting going on. But I think the personal micro-mobility, i.e., you own the scooter, you own the bicycle, I think this will take off. I'm not so sure a lot of people won't go into public transport if you think of the congested subways in London, for example. I think a lot of people will move to their individual firstly, I would say, firstly, on micro-mobility device.

Quin, if I may add something, an argument. I mean, I don't know what you have observed in your various cities, but what we can see according to some polls is that the situation where people were contained and they have started to appreciate silence. We have started to appreciate to go into the streets when the de-containment is starting with much less cars. And for example, in Paris, the mayor of Paris has decided before the de-containment to stop the usage of some big streets, big avenues for the normal traffic. And it could have perceived as a surprise, but my understanding is that polls have demonstrated that the people wanted that to happen in Paris and understood that more... [Technical Difficulty]

We lost you for a second there, Thierry. So Thierry, sorry, we can't hear you for a moment but maybe you're back now. Are you able to -- that's a little bit better now. Let's give it another shot.

Okay. So I'm just saying that, in fact, the micro-mobility is likely to increase much more because of those cities' transportation to be completely redefined and accelerated because of the COVID experience.

Any other views on micro-mobility? So Thierry, I want to follow on, on something you just mentioned about cities shutting down. There, for example, in Europe, and we're actually seeing that here in the U.S. as well. Many cities are shutting down roads in the city center to vehicle traffic or at least to passenger car and heavy vehicle traffic, right, so cars and trucks and buses and whatnot. And a lot of people really like it. And so I'd like to ask all of you, to what extent do you actually see that dynamic persisting after lockdown? So once we're actually all able to get back out there, are cities going to keep that urban core open only to pedestrian and bicycle traffic or are they actually going to reopen it to bigger motorized vehicles like cars and trucks and whatnot?

I'll take a stab at that. I think, Quin, that answer is hard to predict, right? But certainly, the notion of congestion areas and taxing and limiting vehicles, especially in certain areas of cities makes sense, and it responds to the consumer's desire to be kind of more empowered in terms of how they get around. And even within the United States, part of the conundrum, I believe, is that the consumer may desire to use their bike to get around but there's not access. So sidewalks are insufficient or there's not bike lanes in the road. And the mentality stateside continues to be if there's congestion, let's build another lane. So I hope that with COVID and the environmental impacts that have been exposed and benefits of clear skies, that there's this sort of groundswell of momentum towards rethinking and redesigning the whole mobility structure.

Yes. I think...

You've been mayor of Charlotte, huh?

Yes. If I were a mayor today, I would have my transportation officials in with me to look at whether there are thoroughfares you could create out of the existing street grid that it would provide good ingress, egress from the central business district for bikes and other types of micro-mobility. I think Europe is going to lead the way here more so than the U.S. I tend to think that even notwithstanding my leanings towards trying to open up more streets for dedicated bike and scooter paths and so forth, that the American public is still pretty likely, once they come out of this quarantine mentality, I think, likely to be less bullish on even that. I think people will revert back to their cars. I think, frankly, we haven't discussed this yet, but I actually think that private automobile is going to make a comeback here because of people's concerns about sharing space with other people. And I think it's unfortunate, but that's where I think the momentum is. I wish it weren't but that's what I think is going to happen in the U.S.

And Anthony, I agree. I think you could take a step back here, right, in the short term, people less carpooling, less public transportation, more individual rides, so be interesting to watch over the next few months.

The return to car culture.

Yes. I'm personally a little bit more positive in Europe. I think the trend to, for example, particular to bicycles, if you look at London or other major cities, was a trend before COVID and it has been accelerated now. I'm not so sure we'll revert back. It might slow down a little bit but it is a general trend. People appreciate the flexibility and the positive -- I mean, the positive effect on their health. I'm not so sure it will revert. It might slow down but it's an acceleration of a trend we have seen before.

And I believe, too, it's really closely aligned to the macro trend of urbanization, right? Will individuals still prioritize moving to dense urban cities or will there be this halo effect that is encouraging folks to move to a suburban environment? And that impacts transportation, right, from access to public to more of this car culture, not being able to ride my bike 25 miles to work. I think there's a lot of dynamics at play.

And can we talk a little bit about infrastructure? I'd like to talk a little bit about investment in various types of ground transport infrastructure, whether we're talking about fueling infrastructure or recharging infrastructure for EVs or tolling, smart cities, parking. So how is this recession we're in going to impact positively or negatively investment in various types of ground transport infrastructure?

No, no. Just very quickly, I mean, it seems that all sort of governmental subsidies into the transportation sector is always tied to some sort of green investment. It has to be green otherwise governments are seen to doing the wrong thing in putting sort of investing or subsidizing, call it, old technology. So I think electrification will get a boost, and it will be both a support for the vehicle themselves as well as the pressure on setting up charging infrastructures will continue to be pretty high. So I see that as a very positive trend.

EV charging infrastructure. Anthony?

Yes. Look, I think we're going to have several things that will untangle over the next 6 to 7 months. The #1 issue that I'm looking at here is the extent to which state and local budgets in the U.S. are going to be squeezed by the whole pandemic. The loss of a lot of economic activity, whether it's sales taxes or other things, are going to affect the public purse. And that will have a downscale effect on some of the bond issues that may have otherwise come out to put in basic infrastructure. And it may affect the extent to which cities continue experimenting. So again, I'm taking a bit of a U.S.-centric view here. I think that either 1 or 2 things are going to happen. We're either going to see an acceleration of private-public partnerships in some of these areas, whether it's electrification, whether it's smart cities, a lot of digitizing of the transportation network or we're going to see a significant slowdown. I think it's going to be pretty much one way or the other, and it's going to depend heavily based on where you are. Globally, I totally agree. I think there is some movement globally to move faster towards things like electrification. Frankly, I think the U.S. right now is a little bit stuck in the rudder a little bit. And I think the pandemic is only making that harder. So I think we really have to see how state and local budgets emerge from this crisis. And I would say in the next year or so, I'm not expecting very much experimentation or very much ingenuity coming from state and local governments in the U.S.

Tightening of belts. And when we translate that to specific modes of historically publicly funded transport, so thinking about subway, underground rail, surface rail, transit bus systems, when we look over at Europe and when we look at East Asia, the nations in those regions tend to have more developed and robust and more used, more utilization for those different types of transit modes. But here in the U.S., except for a few kind of the most dense cities, New York or San Francisco or otherwise, we haven't had as much kind of usage and deployment of public transit infrastructure. So what do you see in terms of the biggest changes that we're going to observe in those underground, surface and transit bus systems, even after we see, let's say, a vaccine or an effective treatment for COVID, how are those systems going to be forever changed?

Yes. It's a great question. Look, I was speaking with one of the leaders of the San Francisco MTA recently. And again, this is right in the throes of the pandemic, but they essentially had to shut down the rail lines because the cleaning crews that serviced and serviced both the rail and the bus systems couldn't do both effectively with the turnaround they needed. So they had to push them all onto the bus system. The transit agencies are running at a fraction of their utilization. That's going to hit the farebox, and it gets right back into what I was just talking about where they're going to face some severe budget shortfalls in these transit agencies. So I think in the short term, it's a game of survival for these transit systems. Longer term, I'm expecting that once we're sort of clear from this pandemic, that we're going to have to start paying bills back. And so are fare increases going to make it even harder for people who already are concerned about going into these confined spaces with lots of people, is it going to make the utilization continue to be a little depressed over time? I would probably say so. Transit agencies right now, the smart ones will find ways to partner with companies that maybe can support some of the systems that they normally would do. So the MTA in New York has been reaching out to companies like Uber and Lyft to figure out whether there are partnerships that could exist that may offload some of the burden from the transit system but also feed into some of their arterial subway networks and so forth. And those kinds of things, I think, are probably the best way for transit agencies to go. But it is going to be very, very, very dicey. And I frankly don't think I can separate the financial challenges these agencies are going to be confronting from the overall outlook on how consumers will use them.

So it sounds like transit agencies might cope financially with this downturn through public-private partnerships, so partnering with private companies to enable some of those transit services that were previously publicly funded. Is that what I'm hearing right? Are there any other kind of methods that they're going to use to cope financially with this beyond those public-private partnerships?

I don't know. I think you're going to watch this next round of COVID legislation in Washington because the #1 issue will be state and local funding. And if Congress is able to put enough robust funding in place to stabilize these agencies, then you can forget what I just said. But my guess is, is that there'll either be partial support or perhaps even no support, in which case, they're going to be strapped for quite some time.

So I want to raise one last question on transport policy. So we've been thinking a little bit in our firm about how public officials, government officials have had to weigh the kind of public safety implications of autonomous vehicles against the public health implications of autonomous vehicles and also alternative modes. So now officials are thinking about what are the public health implications of mass transit, of packing a bunch of people inside a bus or a train or what have you? And so we've been thinking about how does that actually net out? If you're a government official, how might your policies change as a result of COVID, especially as it relates to these last-mile autonomous vehicles? So these delivery bots that we're seeing to deliver burritos and pizzas and medicine and whatnot, how does it change -- how does the way that officials think about robo-taxis change? How's that kind of equation, that balance between public health and public safety change? And maybe even long-haul trucking, but I imagine, to a greater extent, they're thinking at the kind of the state and the municipal level about last-mile AVs and robo-taxis or maybe kind of at the state and federal level, we're thinking more about long-haul trucking. So what's your take on that, Anthony?

It's that you would think that we would be trying to accelerate solutions that would lessen the public health threat and give us more optionality. I think the jury is still out a bit there. I think the industry itself is probably gearing up for wider deployment of AVs in the next 3 or 4 years. I frankly think it's a good time to try to accelerate that curve and to see whether there are things, not even just autonomous vehicles, but if you think about medical supplies and this company that's out in Silicon Valley that's gotten a lot of traction around getting rural health care, cutting down the time to get medical supplies delivered into hard-to-reach areas. This is the time to do things like that because I think -- and frankly, from a Lyft perspective and I'm not speaking for Lyft, I'm just telling you kind of my own view of the world, but we've got simultaneously with all this public health stuff, there's also significant issues that are being dealt with out there on labor law and so forth. And you put the public health issues alongside the labor issues, and you would think this would be a time to accelerate a lot of the autonomous stuff.

So maybe aside from labor, this may actually be kind of a net tailwind for certain types of autonomous vehicles.

Yes, yes.

So maybe we can shift gears a little bit and talk a little bit more about kind of the vehicle production side of things, vehicle manufacturing, technology going into vehicles for a little bit. So I'd like to open it up to the whole group, anyone who would like to chime in. So let's talk a little bit about CASE or ACES, right? So connectivity of vehicles, autonomy of vehicles, of shared use and electrification. So when we think about tailwinds and headwinds, so what do you all think? Which of those kind of key tech trends are going to be accelerated as a result of this COVID and the macroeconomic climate we're in? And which ones might actually be decelerated as a result of this?

Yes. I can start, if you want, Quin, about that.

Please.

Yes. I think that's a major trend, which we need to observe after COVID but which probably will continue is the proportion of people living in big cities. And when you start with that, immediately, you are confirmed in the fact that big trends that you have mentioned will probably not only continue but even more get accelerated. Of course, we all think about the clean mobility. And you can see through regulations but also through the expectations of people living, especially when they are living in big cities are really for clean mobilities even more today than before. So this, I think, and it's visible in the data in the proportion of electric cars which are being sold even just at the beginning of de-containment, it's visible that the proportion of this. That's the point number one. The second point is about connectivity. We have to understand that almost all cars today are connected to a certain extent. Even excess cars, a smart buy, as we say, they are connected already. And they are going to be more and more connected, including because of regulation because regulation push everybody to get connected cars, and it's going to be more and more necessary, not only connectivity with offboard information getting to the customers and to the users of the cars, but also getting connected to the infrastructure in order to be smarter and smarter in the way to get fluid in the traffic and to avoid congestion. I would say that as already mentioned, which is the shared mobility, okay, can be a little bit impacted, can be a little bit slowed down apparently because people want to be alone in their own car to avoid any possibility of contamination. But at the end of the day, we need to see what's going to happen there because the shared mobility is a very strong factor in development, and there is no reason why it should not change in the future when things will be done in terms of the risks in terms of COVID.

You're breaking up a little bit, Thierry, there. Maybe...

I would add here another dimension to the famous CASE that you have mentioned. And I think that, yes, is it back now?

Yes, back now.

I would add on that dimension that I think that the health dimension of the future mobility, yes, which has not necessarily been taken into account until now. It was written to be the safety factor but the safety factor could become safety and health factor in all what we could develop, especially, of course, in everything which is shared mobility. Then you've got the autonomous driving dimension. That one, of course, will take, for sure, a little bit more time than expected. And it's true that for all companies today fighting for survival, the magnitude of the investment in order to push and move forward as fast as possible in terms of autonomous driving could take a little bit more time. But at the end of the day, because it's becoming accessible technology, especially when you get connected to the infrastructure, the magnitude of change in terms of reduction in cost, reduction in price for mobility and increase in safety and fluidity and smart mobility, it's such a big factor that at the end of the day, even if with some delay, that trend should remain, if not, in the future, be accelerated. So for me, the CASE structure is still extremely vivid. I would add that the accessibility of it and the health, whatsoever happens. And this will be my last comment. I think that the...

You're breaking up a little bit again, Thierry, sorry.

Because of this COVID, but the disruption on the economic side is such that we could think over that again. It's okay, not yet? Is it working now?

Yes, it is.

Do you hear me?

Yes.

Do you hear what I'm saying at the moment, Quin?

Yes. [Technical Difficulty]

I would say that the magnitude of disruption, especially on the economic sector, that the world will think over. But how is it possible not to stop for the next COVID to come? And as such, taking into account the health factor in everything we are developing in mobility for the future is something which I believe could be... [Technical Difficulty]

Maybe, Thierry, if you could just turn off your video, that might -- if you can turn off your video, that might free up a little bandwidth for the remaining audio.

Hello, Quin?

Yes. If you could just turn off your video, that will help us a little bit.

Okay. I don't know when you stopped listening to what I was saying. So I apologize for the bad connection.

Yes. Well, global world we live in, differing Internet speeds. So maybe we can -- if anyone else has any comments on this kind of CASE or ACES framework, would love to hear any opinions. Yes, Steve?

One piece of comment. I mean, I think if you think about connectivity, as we think about it in the supply chain world, really translates to us around visibility, right? And even now, it's a lot of time and investment by many companies in increasing the visibility and collaboration across supply chains. I think is -- post-COVID, it's going to be even more critical, right? People need to see in real time where their supplies are or where their shipment is coming into their home or business. So that's really what connectivity means from our perspective.

So leveraging you have awareness on supply chains, okay.

Just 1 comment which I'm observing. I used to be the Chairman of the London Taxi Company, the company which produces the new London electric taxi, for example. The taxi business in London is completely down, you might argue, because nobody is traveling. No, people are still traveling in London to the workplace and not insignificant numbers. And you would have thought it's time to use a taxi. And it's unfortunately not. And Uber is very, very massively impacted in London and basically almost going out of business. The 1 element which we should not forget that, I would say, somewhere between 30% and 50% of the people are much worse off right now, a massive impact on the personal income. They have less money to spend and it will take some time before, number one, first of all, the income resumes to the old level and the old job is back, and secondly, their confidence back to spend it. And that I think will have an impact on, for example, public transport versus taxi versus individual. Can they afford to take a more expensive way of individual mobility rather than going for mass transportation? And that, I think, will play a massive role as well as -- and we'll come to that. What is -- what does vehicle demand look like? And I think, particularly at the, call it, mid- and lower-income strata, the lack of -- I mean, this almost traumatic experience of losing a job in the United States, 36 million people. In Europe, people being furloughed, they get 80% or 67% of their income, but they can hardly get along and can survive with a normal life will have a massive impact. And it will take quite some time before consumer confidence resumes and they are willing to spend to anything, which is a bit more expensive than the minimum transport cost, minimum whatever. That's my only concern.

I think that's also a fascinating juxtaposition between the sentiment that all of this technology around ACES is sort of democratizing access to transportation or intended to. So if you think about autonomy in the right form, it unlocks transportation to the elderly, to the sick, to children, to disabled. And it also provides, through sharing, better economics or if you take the driver out, the economics look even better. So absolutely agree about the short-term tension of unemployment and affordability around some of these technologies. But I think big picture too, these technologies present an opportunity to lower the cost of transportation long term. So it's really -- it's interesting.

So CASE as a means or a method for democratizing and reducing cost of transport. Carl-Peter, I want to ask you a bit about the Chinese market. So a lot of folks are observing what's going on in China as sort of a leading indicator for what might happen in the rest of the world because that was kind of the epicenter or maybe the origin, depending on your views of COVID. What are your predictions for the Chinese auto market? And in what ways is China a leading indicator for how other markets around the world might recover? And in what ways is China uniquely Chinese?

First of all, I think the experience of most of the Chinese consumers is probably very different to the ones particularly in Europe and the countries which are hardest hit. You had a 2-month Wuhan lockdown. You had a 4-week mild lockdown in the rest of China. They are very disciplined people, honestly, quite sturdy people. And if you look at the current demand, it's basically back to roughly 80% of the precrisis level very quickly. And it's -- we can see because the suppliers I'm talking to are knowledgeable can see a month-on-month increase towards probably, in not-too-distant future, probably to pre-crisis level. You might argue, but with the growth rate in China, it should have been even higher. So anyway, a very quick rebound. I'm not so sure this will happen in Europe. In Europe, the retailers have opened. The -- and the demand is very, very weak. It's 50% or less of what it used to be. And the European manufacturers are very, I think, not particularly optimistic about a quick rebound. So we'll probably see a very slow recovery of consumer demand. Then you ask and what you can see in China is the premium segments are rebounding quicker than the volume or the lower price segments. Again, it has something to do with the personal experience of the consumers. I hear there is a sign of life in the U.S. interestingly enough, mostly in the truck level, the truck segment, which probably has something to do which states have a prevalence for which type of cars and which states had experienced less of a lockdown and which federal states are seeing more of a lockdown. There's a bit of sign of life in the U.S. demand. And again, it's probably psychology of people. I think the American consumers are probably, again, a little bit more resilient and might come back, and they typically react much faster to trends, both negative as well as positive than the Europeans. So kind of long story short, China is coming back very quickly. I would hope that the U.S. is coming back rather quickly, perhaps not quite as quickly as China. And my real concern is that Europe will be in an extended lockdown. The experience for consumers is traumatic and will continue to be pretty traumatic, and Europe will take a long time before it comes anywhere close to pre-crisis level.

And I'd like to ask the group's predictions on what kind of mergers and bankruptcies and bailouts and new entrants are going to be coming over the next few years. But I understand, Anthony, you've got to jump off. The rest of us will carry on. We have another 25 minutes or so to talk about the auto industry, and then we'll get a bit into retail. But thank you, Anthony, for joining us and the rest of us will carry on here.

Thank you, Quin. Great to be with you.

Let me give you a very quick one. First of all, I think if FCA went in merger discussions, they would have to find home now absolutely. So they have to press on with the PSA-FCA merger. I'm not so sure much will happen on the non-China sort of OEM side. What you will probably see is a lot of consolidation or rescue consolidation type in Tier 2, Tier 3 suppliers, particularly in Europe, potentially also in the United States.

So bailouts of Tier 2, Tier 3 players or rescue by governments or rescue by --

No, rescue by suggested consolidation. OEMs will ask supplier A to basically look after supplier B, this type of stuff. I think the industry is, in many cases, looking after itself, particularly on the lower-tier levels just because a lot of these suppliers are in Europe, in particular, are in a particularly difficult situation. And if it continues, as I suggested, and the rebound is slower than we hoped for, I think we will have to help a lot of Tier 2, Tier 3, Tier 4 suppliers.

So some consolidation among Tier 2, Tier 3, Tier 4 suppliers. The FCA-PSA merger likely to carry on?

No, they continue to confirm they're carrying on. And I think there's a lot of pressure on the FCA side to make it happen.

And what do you all see relating to government bailouts and bankruptcies? What's your prediction there?

In the auto industry, we have such a fine network of interdependencies, it's very difficult to accept a lot of bankruptcies because you would cut through supply chain. And then sometimes, it's pretty difficult to step in within a short period of time. So as you have seen in the last crisis, there weren't a lot of bankruptcies. And if there's a bankruptcy, somebody else is picking up the assets and then continue operation because otherwise, the supply chain won't work. So I'm not so sure there will be a lot of governmental interventions in that industry for the time being, if we see some rebound, particularly in Europe. If not, the situation will be very different.

I would add, if I may, Quin, I will add to the comments from Carl-Peter, which are absolutely relevant. I would add that in the short term, I mean, the forecast in terms of reduction in turnover is absolutely massive. It's more or less 2020 at minus 20%, more or less. If you look at 2021, prospects are between minus 5% to minus 10%. But if you look at what Toyota has disclosed, for example, in the operating profit prospects for 2021, it's not better than 2020, which means that the likelihood that even 2021 is worse than minus 10%, could be minus 15% is unfortunately very significant. So for the whole industry, not only the OEM but also the OES, as mentioned by Carl-Peter, I mean, the huge challenge is how to make money not only survive but start remaking money with a level of turnover, which is the top line, which is not the same as before. And with the little margins of this industry, you cannot finance anything if you don't make minimum 6% to 7% operating profit. So this is the big challenge but it's a big challenge for everyone. If 1 piece is missing, of course, you cannot deliver a car. And you cannot switch to another supplier just within a couple of weeks or months. It's not possible. So this is the big challenge for everybody, starting with the OEMs for the coming months and for why. That's the point. It's not only for a couple of months. It's going to be for a couple of years that they will need to do that. So in my view, the likelihood of accelerating the search for scale, the search for partnership, the search for cost reduction and value enhancement is something which should happen very quickly because otherwise, it's just not sustainable and it's going to be very quick.

And so in Autotech Ventures, we live in the start-up world, and so we think a lot about new entrants. Start-ups coming in, and there's been many start-ups that have attempted to become vehicle OEMs, plenty that have attempted to become Tier 1s and Tier 2s and whatnot. What do you think all of this consolidation and shake-up and restructuring of a lot of the incumbents in the auto industry means for new entrants? Do they fare better? Do they fare worse during these coming years?

I'm afraid, I think it will be a much more difficult environment for smaller new entrants into the business. There's probably less capital available, less willingness from OEMs to bet on a start-up. My observation is, already starting before the crisis, OEMs are basically withdrawing from their activities to run their own funds, reduce it, shut it down or only very few OEMs are really running sort of a venture fund professionally and are willing to invest. And I think in the current environment, this will be much reduced. I can't see OEMs are investing a lot of money in start-ups right now as we speak. And the environment is much more difficult to cut through these difficult times and to build your own business. It will be in this space unless you have absolutely superior technology, and there are these cases, and money will flow into these cases. For everybody else, it will be very difficult.

And we're seeing some of that in terms of capital flow to well-capitalized players are certainly going to have a leg up going forward, right? And that consolidation could have this unintended consequence of actually accelerating innovation, I believe, in some areas like AV. And on the EV front, you mentioned, Quin, the handful of new EV OEMs, kind of start-ups themselves. Certainly, they're all at different stages of maturity. It will be interesting to watch. One of the things the new EV OEMs has going for them is the fact that they are a little bit less encumbered, say, by the legacy processes, the vehicle production and software and all of the component parts. So will few be able to capitalize on that agility and out-innovate and get to market at a price and speed and quality that makes sense for the consumer.

Yes. I'm a little bit more skeptical on these upcoming EV start-ups. If you look at Tesla, Tesla has done probably as good a job as you can do on the marketing and technology side. And it's admirable what they have achieved, to be honest. You know I'm an old auto guy, so you tend not to like Tesla, but you have to honestly admire what they have achieved. We just had a discussion today, they are selling off CO2 credits or emission credits is a $1 billion business. If you deduct $1 billion from selling credits to their current cash flow, it's pretty dire super negative. The real truth is, building an automotive company is absolutely is burning cash like hell. It's eating. It's a black hole for cash. And the question is, who is willing to fund this in those space? I mean, you see the Chinese. They're coming up with real good product. And the question is, how do you finance to grow this from a good product into a sustainable business. That's my only concern that it's so cash intensive, who is willing to put up the cash for it. And Elon Musk is doing a good job because he is always coming up with a new idea and people are willing to finance it, but not many are able to do that.

It's really, really tough to enter the auto manufacturing business. But if you do, make sure you have access to some very, very deep pockets to give yourself a shot.

Yes. Yes. No doubt.

You've mentioned Tesla there. And I'd love to hear our panelists take on manufacturing. So Tesla here in Silicon Valley, here in the Bay Area, Tesla's had some challenges in contending with the local government officials regarding reopening of their plant in a safe way. So I'd like to hear your views, any of the panelists' views on how can vehicle OEMs rethink manufacturing to prevent outbreaks in their facilities and maybe how might they use technology to achieve that?

If I may again...

No, please, Thierry, you start.

Sorry, Carl-Peter. No, just a couple of thoughts thinking about that. I think, first of all, that the heart of manufacturing excellence starts with 0 casualties in terms of HSE and which means that everybody should be back home safe and in full integrity. And this is the heart of the excellence in manufacturing since a long time and permanently improving. And why is that? Because the management skills to reach this type of incredible result is the same type of skills you need to get to a 0 default when you manufacture cars and deliver to your customers. So the permanent improvement of getting very attentive to the health of people is such that this new challenge coming in plants is, of course, disorganizing a lot the production and you've got many, many testimonies about that. But I have absolutely 0 doubt that industry will adapt and find competitive productive solutions to integrate that challenge inside what is massive anyway to make sure that people are back home in a very safe manner. So that, for me, it should not be a big issue. In my view, the world-class industry in the OEM is and also the same for the OES, by the way, is a war machine in solving problems. And after a period of adaptation, I'm sure that we are going to find solutions which are going to help us getting back in terms of productivity and competitiveness.

So that skill set that the auto industry has in terms of reducing defects, eliminating defects is highly applicable to reducing outbreaks and eliminating outbreaks inside their facilities?

Thierry, if I may, I'm slightly different of opinion because the COVID challenge is a short- and medium-term challenge, hopefully. And medium term is, for me, 2 years. And if you look at not only the OEMs but the whole supply chain, you have many, many technologies, many manufacturing structures where people are far apart. The body shop nowadays, you virtually have no issue other than perhaps in the final sort of hand finishing of the body, for example. In paint shop, people wear masks. And most of the painters are robotic and you have a bit of hand finishing to do where you can separate people very easily. Very different in assembly. I mean, there is a general thinking of basically dissolving the assembly line and creating sort of islands of assembly, but that takes 10 years to implement. So for the next 2 years, you have the issue that you have certain workplaces which are almost impossible to separate people. On the assembly line, it's virtually impossible to separate people far enough, 2 meters. In some stage, it's possible; in some stage, it's not possible. So you come back to, you either run a risk of creating an infection of sort of outbreak somewhere or you find a way to, number one, track and trace and see who is close to who. And I think what the industry, and I think a lot of manufacturing industry will find a way to track and trace because it's a microcosm of society. We have to find a way to track and trace. So there's a lot of initiatives going on to create very fast simple tracking and tracing mechanisms where people wear a badge, which indicate which other badge was close by. And in case I'm infected, we can trace back who was close to me, for example. That's one way of then eliminating a possible infection. I think we have to think about this very fast within weeks, and that's what's going on. There are some technologies available in the market already. And I think the whole manufacturing industry will have to think about wherever physical separation is impossible because you can't change the manufacturing structure fast enough.

Yes, Carl, I would extend that to distribution when I think about warehouses, right?

Yes, absolutely.

Extremely difficult to separate. So we've started using some of those technologies that you've described to try and track and trace when we do have a case to break out and do the proper cleaning and quarantine. But it's going to change the way we work, certainly.

So let me shift gears here away from production of vehicles toward retailing vehicles, so retail and wholesale. Let's talk about vehicle commerce or auto commerce. So we were talking earlier on this panel about maybe there could be a reversion to personal car ownership, on the return of car culture, car culture Part 2 in some parts of the world. And Lea, I'd like to ask you a question about online auto retailing, digital auto retailing. So as COVID accelerates online auto retailing, and you're part of one of the world's leaders in Cox over in auto retail and also digital solutions for auto commerce. So as we see this acceleration in online auto retailing, what do you think are going to be the cascading effects, kind of the secondary or tertiary effects on the auto retail or auto commerce ecosystem as a result of digital auto retailing?

Great question, Quin. And Cox Automotive has been doing our weekly COVID impact study, so a lot of what I'm going to share is related to those assessments. But essentially, COVID is absolutely disrupting the traditional car-buying experience, right? But what we're seeing play out is, dealers are embracing some of these new buying alternatives, right? Because what the consumer is telling the dealer is they want to do more online. And in fact, we found that 2 out of 3 consumers want to go so far as to complete a purchase online today. So the dealer is responding and really looking to transform their physical store into this virtual experience to provide these buying alternatives the consumer is seeking, right? So some of what that means is, there's a big increase and desire to finalize the deal online, which I've talked about. There's also a big increase in the desire to coordinate a test drive online as well as let me apply for my loan online. And again, the dealers are embracing this whole spectrum of digital retailing. And maybe it plays out a little bit differently when you think about franchise dealers versus independent dealers, but both are experiencing some big impacts and changes in these areas.

Big changes in auto retail. And you all, Lea, you all are very active players in automotive wholesale. So can you share with us a bit your views on wholesale? What are your predictions for how this kind of wholesale vehicle market evolves over the next few years?

That's a great question. It's something we track consistently and obviously regularly and daily with COVID. The good news is, we've seen some recent momentum in both used retail and wholesale and really recovery in those markets. And our Chief Economist, Jonathan Smoke, publishes daily kind of about what's happening. And as of Tuesday this week, it was brought to a 6% year-over-year decline in that market. So there's a lot of positive momentum, right? And the supply that we're seeing is also starting to even out, right? We see that both on the retail side, where the normal retail supply is about 45 days and it's actually down to 41 days this weekend. On the used supply, we peaked at 115 days on April 8. So there's more movement in the market for sure. And as the downturn eases, we expect to see more acceleration, both in the retail environment, which is going to drive used sales, and we're seeing more of that pickup and then ultimately, drive activity in the wholesale markets as well.

And let's talk a little bit about EVs and EV adoption across various vehicle types and also across various regions, right? So China has obviously had a substantial EV push. U.S. adoption, especially in kind of the more dense coastal regions, EV adoption has been a little bit greater. If you look around Europe, as a result of Dieselgate, there's been a massive push for electrification, especially in Scandinavia, right out in Norway. Maybe that's why Anthony Foxx is learning Norwegian. So there's different kind of EV activities around the world and various levels of penetration. Now with oil prices plummeting over the last few months, what does that mean for EV adoption? And I'd love to hear, Lea, your opinion, any of our other panelists who are also experts in EV?

It's an interesting dynamic. My perspective is that at least stateside, low fuel prices is not the primary reason a consumer goes electric, right? They're focused on either the improved driving experience, the enhanced technology and sort of do good for the environment as their motivators. It certainly makes the equation a bit more challenging when you think about fleet adoption of the EV because fuel plays a really important role there. But again, what also emerges is just overall lower maintenance cost for the electric vehicle. So I think big picture long term, lower oil prices is not going to be a long-term forecast to begin with. And even if it was, it shouldn't unnecessarily subdue EV adoption because there's a lot of other factors at play when one considers.

No, I would completely agree. I think fuel prices are not really important. If you look at the recent offerings, and they're all in the medium and upper price range, i.e., they're addressing people with the means and where fuel costs are almost irrelevant. So it's more a question of, do I do good? Do I look good in doing good? For example, that is much more important. You see much more offerings now. It's basically in '19, '20, you see the medium and upper end of the price scale, you see many more products being offered, and that's probably why you see also the market picking up. I think it has a lot to do with subsidies, both financial or nonfinancial, i.e., or some support mechanism. Are you allowed to, I don't know, park the car in various cities like in Sweden, for example, for free or do you have particular parking spaces reserved for EV? So there are lots of ways of incentivizing people to buy an EV which are nonfinancial. And the communities, some communities are pretty clever in using these incentives and some are not. But I think that is more important. So what sort of -- how does it look good in particular or do I have interesting incentives, financial or nonfinancial, to buy one of these vehicles? And you see more and more of this happening. And hence, I think the EV penetration will go up significantly at the upper end of the price range.

And if I may add something, Quin, about that. When you look at regulations because regulations are playing a very strong role in the way the offer is being structured and also the demand being incentivized, as we just said. And it looks like there have been some attempts in Europe to say, hey, what about pushing a bit or delaying the application of some regulation? And at the end of the day, it's over. Everybody wants, at the end of the day, to keep the regulation as it is, but to improve the incentives so that the EV or electrified vehicles can be chosen as a priority to the pure ICE vehicles in this period of time. And I think that in China, it's exactly the same. It's really moving forward to electrification as well. For the U.S., I don't know if it's, maybe it's going to be a softening or a 0 effect. This is up to you to answer to this point really.

Yes. So we have time for one more question. I just want to open this up to any of our panelists here. If you had to pick, what are the greatest 1 or 2 opportunities for start-ups over the coming years? So we have a lot of entrepreneurs who are on this call today. So what do you think are the biggest opportunities for those entrepreneurs?

If I may start answering after what Carl-Peter said a couple of minutes ago, I think that something which an experience, which is happening during this COVID period, is about innovation because everybody is taking care of cash, taking care of continuity of operation. But at the end of the day and enjoying almost the remote way of working, the boost in digitalization that all companies have experienced massively during this period of time. But we hardly talk about innovation and the innovation momentum. And I think that quite quickly after all what's happening now, innovation will continue to be absolutely a necessity for all our industries and for the mobility. And here, the experience we have had with start-ups will continue to be vivid, which means that the boost in innovation that start-ups can bring, it's still a very important factor for these industries. And I would say that bringing innovation not only with the new dimension of what we have experimented, especially on the health side, on the sanitary side, is something which I believe is still very vivid. And second, in the way of working as well, I believe that the start-ups can bring and structure their value offer towards companies which is still extremely necessary for these big animals, especially in the context where partnerships will be more and more necessary. So I understood what Carl-Peter said about funding, which I 100% share. At the same time, the added value from start-ups against the big animals that we are used to is still extremely valuable in my view.

So we are out of time. So this has been really educational for me. To everyone out there in the audience, we really appreciate you joining this. And we'd love your feedback on what we could improve for the next one. We at Autotech Ventures, we love connecting with all kinds of folks who are passionate about solving transport problems. We hope today has been inspirational for some of the folks here. It has been inspirational for me. So please do reach out to us. If you're an entrepreneur who's seeking funding or you're an investor who's interested in the transport space, maybe you're a corporation looking to engage with transportation start-ups as innovation partners or if you're interested in any of our portfolio companies which are shown on your website, please do reach out. We'd love to engage with you. Thank you to all of our panelists who have joined and thanks for everyone out there around the world who's joined virtually. Stay healthy, everyone, and until we get moving again. Thanks, everyone.

Thank you.

Thank you.

Thank you. Bye-bye.

Bye-bye.