7 Migrants Dead in Rail Container: The Cartel’s Darkest Freight Secret

0:27This podcast features Michael Vincent and Phil Brink and Malcolm Harris.

0:30Malcolm Harris: Ladies and gentlemen, welcome to a Wednesday edition of What the Truck. It's July 29th, and it's hump day. We're still going to make it happen here on the Fastest 45 Minutes of Freight. I'm your man, your host, Malcolm Harris, joined by the dude. You guys know the name. You guys know the voice. It's Mr. Michael Vincent. Mike, what's up, baby? What's shaking, baby? You know what we missed? What we missed? We missed getting Lance Healy to air drum that. I hate missed opportunities. I can't stand it. You know what I'm saying? That's on me as the conductor, you know? I try every time. People don't see it, but I'm trying every time to airdrum that beginning, and I just can't make myself not look like a complete fool trying to do it.

1:18You know what I'm saying?

1:19Malcolm Harris: Yeah, that's just not it, man. I'm sorry about that. That's a missed opportunity. We can't have that. We can't have that. How's your week been? how's my week been yeah fantastic dude so it's awesome i love it bro it's hot it's sunny it's it's beautiful getting getting you know job done had some opportunities to bless some people got out talked to some drivers uh listen what the truck west you got to come out here we'll do a show from the uh 146 media studios here at what the truck west that's gonna happen in the next 90 days I'm just letting you know. So I'll be. You're going to be out here. Yeah, I'll be in Dallas and we'll get a show together.

2:00Malcolm Harris: I think that's going to be fun. A hundred percent. We got to do one from here. Yeah. Hell yeah. No doubt. No doubt. That's happening. Do you miss Chattanooga at all? Certain aspects of it. Yeah. But I really, I'm not like, man, I wish I was back. Because there's so much to do here. There's so many distractions that are good and things here. So I'm not going to say I'm so glad I'm out of Chattanooga. or anything like that, but there's just so much to do here that it's like, I don't even think about it. You know what I'm saying? If I went to, like, Crossville, Tennessee, I'd probably be like, damn, I wish I was back in Chattanooga.

2:37No offense to Crossville, but come on.

2:38Malcolm Harris: I was going to say Crossville just got a shot for no reason. I mean, geez. It did, and that wasn't very nice, was it? I take it back. What did they do? Yeah. Let me, Midland, Texas. How about that? Midland, Texas. I'll never forget, you know, one of my favorite movies before we get to on deck because we've got two great guests. One of my favorite movies is Friday Night Lights. Oh, yeah, for sure. And Boobie Miles went to Odessa, right? And I can do a great Boobie Miles impression. Let's hear it. Are you sure? All right. Yeah, no. I'm not sure, but let's do it anyway. I may regret this. All right, you ready?

3:18They don't want me to play football, don't fall.

3:20Malcolm Harris: They don't want me to play football, don't fall. We practiced and we practiced. I was going to go to the pros. That's my boobie mom's impersonation. That's when he tore his ACL. Malcolm Boobie Harris. Yeah, Malcolm Boobie Harris officially. I love it, dude. He was like, Midland, are they paying you? Because they told him his ACL was torn and he went to a doctor in Midland. So that was the story behind that. Oh, so that's where that went to. Yeah, that's why. He went to the big city of Midland. And they told him that, yeah, your knee is a pork butt, so you're no longer going to play football. So get on LinkedIn.

4:00Yeah, yeah, yeah, yeah, yeah. I'll tell you what, though, man. Yes, sir. That is for real. High school football stadiums are massive around here. The one right around by my house is, like, bigger than Finley Stadium and brand new. It's a high school stadium.

4:13Malcolm Harris: There's a really good high school out in Dallas. I don't know what it is, but they're always nationally ranked. I think Kyler Murray or somebody went there. like it's yeah everything is bigger i believe it football is different yeah no it's it's a bit yeah it's uh it reminds me as i mean it's yeah it's different yeah no doubt sure we've got some different guests on deck today let's talk about yeah we do we're fabulous ones all right we got a dynamic duo first coming to us is going to be patrick sullivan he's a co-founder and ceo of ev realty all right so everybody's talking electric trucks nobody's talking about what it actually takes to support them.

4:49Malcolm Harris: So Patrick's here to break all that down for us, talking about how, again, industrial real estate might be the most competitive and biggest competitive advantage in freight nobody's paying attention to. And then we got the co-founder as well as CEO of Cypher and Row. That's Mr. John Nolan. All right. Freight fraud is only getting worse. John, he's building tools to actually verify who brokers need to be doing business with. So we're talking trust scoring, packet scanning, audit trails, all the things. All right. So between John as well as Patrick, it's going to be quite the show. It's going to be fun.

5:28Malcolm Harris: I saw some notes earlier, and I think we're going to have a nice little 45 minutes here on the show. So we got Patrick and John. We always do. They're waiting in the wings. We always do have a nice 45 minutes. We do. We do. We usually need a second 45 minutes, but it's usually more like 55 minutes that we just say is 45. Yeah, yeah, yeah, yeah. We say 45, but really, man, it's in the 55-ish range, but it's all right. Yeah, it's there. Regardless, if it's not 45, if it's 55, if it's an hour, that time would not be possible without Gnosis Freight. All right, Gnosis has been top of mind here for us here at What the Truck.

6:07Malcolm Harris: They are a sponsor of the month, and we cannot do what we do without the folks at Gnosis Freight. Again, if you're still checking carrier websites, copying container data into spreadsheets, chasing updates through email chains, you got to have Gnosis. All right. It is an AI operating system for global logistics, one platform to track every single container, automate execution and protect your margins across the full container lifecycle. They saved companies millions of dollars with their processes. You should go check them out if you are in the hunt for savings right now within your organization.

6:35Malcolm Harris: This is at GnosisFreight.com. Book a demo. Make sure you tell them. Michael Vincent, Malcolm Harris, we sent you. All right, Gnosis friend, thank you all so much. And go to your market, your favorite grocery market, and insist that they start carrying Gnosis gnocchis. I did not think you would say that whenever I was taking a sip of water. And you never know what you're going to do. You never know what you're going to do. But I do, Michael, I do know something that you're going to do. Oh, what am I going to do? I know that you're going to be at F3, the Future of Freight Festival here in Chattanooga, Tennessee on October 27th and 28th.

7:14Malcolm Harris: All right. For those that want to see Michael Vincent, for those that want to see Malcolm Harris, for those that want to be a part of the best event in supply chain. I'm just saying it right now. Am I biased? Yes. Am I paid to say this? Kind of. I'm just letting you know to be honest with you. All right. F3 is going to be an amazing opportunity for shippers, for carriers, for brokers, for logisticians in the space. Whoever touches supply chain, you need to get to F3, and it is going to be one heck of a time. We got demos. We're going to have conversations. We're going to have swag. I mean, it's just really cool.

7:48Malcolm Harris: It's going to be at The Signal, a great event. Our team works really hard. Jen Wiggins, Dale, Ashley, the rest of our production crew. It is the WrestleMania of logistics and supply chains. So come on out. It's going to be the 27th and the 28th. tickets are on sale now i know you guys have a question about price everybody's looking to cut cost well yeah that's pretty valid i understand we do have a promo code right now for you it's just take 20 all right get you 20 off right now again f3 gonna be the 27th and 28th here in the scenic city of chattanooga tennessee all right so yeah i'm not paid to say this um well not in money but reach out to my man, Dale Stewart, man, and he'll hook you up with, like, you know, exhibitor or sponsorships and all that kind.

8:38I'm working with him right now to make some cool stuff happen. Hopefully, we're going to make that happen. We're negotiating some things. Maybe we're going to do some really cool stuff there, Malcolm. It's going to be fantastic.

8:47Malcolm Harris: I cannot wait. Yeah, Dale's a great guy. He knows what he's doing. So, for those that want some real involvement within F3, definitely reach out to Mr. Dale Stewart again. Shout out to Dale. Yeah, hardest working, man. Hell yeah, man. Yeah. Dale Tenet. He's awesome. I got to make him happy, too, because he's got some dirt on me. I need to keep quiet. Okay. For sure. For sure. We'll get that. We'll get that plastic on all platforms. Don't worry about it.

9:11Malcolm Harris: So we are not going to do a full dive into headlines like we normally do. There's a story that we're going to touch on, and we're going to talk about it in a second. But for a full recap of everything that's happening right now, you guys know it's earning season. All right. So we have had C-suite decision makers throughout the week on Freight Waves today. The theme is going to continue today with Craig Fuller as well as Julie Vandekamp. Tomorrow, there's going to be a special Freight Waves today live from the Westin here in Chattanooga, Tennessee. It's going to be myself as well as Julie Vandekamp going to be there.

9:44Malcolm Harris: And we're going to just continue the theme of talking about earnings, talking about the latest headlines when it comes to things happening. But then also, it was our Future of Rail event took place yesterday. And there was some great conversations that happened in terms of just talking about the future of rail, what's currently happening in the space in terms of mergers and acquisitions, some huge conversations. So for those that missed it, definitely look on our website right now, freightways.com, to be able to understand the totality of what's currently going on in the space. Because it was some really, really good stuff yesterday.

10:16Malcolm Harris: So I want to give a quick plug for that, as well as a full headlines breakdown tomorrow. But I say a but because we do have something to talk about. Saw this piece from Phil Brink, and it is a wild one. And I couldn't just not touch on this. All right. So looking at this from Phil, we had a total of seven. Count it seven. This is a sad piece. I don't want to seem like I'm happy about it by any means. This is not good. This is not it. Seven smuggled migrants have passed in a real container and 11 are facing life sentences. This is pretty dark stuff. All right. The indictment describes a human smuggling organization that used cargo trains to move people into the U.S.

10:57Malcolm Harris: Officials announced the charges Friday in Del Rio, Texas. Each defendant faces up to life in prison if convicted. All right. So the indictment covers conduct from at least April 2023 until May of this year. All right. Prosecutors claimed that the migrants of the families paid the smugglers between$1 ,500 and$10 ,000. They would move people after crossings from Mexico. This is nuts. All right. So according to the indictment, smugglers moved at least seven migrants from Acuna, Mexico, into Del Rio. May 9th, they brought the group near a Union Pacific track. Prosecutors claimed the group used red boat cutters to remove a container lock.

11:35Malcolm Harris: They then placed seven people inside before the train left. All right. So for those that know this, obviously, May in Texas, it's hot. Containers get hot fast. The temperatures range from 88 to 92 degrees that day. And you guys know the rest. All right. So with this, this is this is crazy. This is crazy. I mean, just to put it in perspective, I mean, people were charged with conspiracy to transport migrants resulting in death. They are also charged with aiding and abetting transportation resulting in death. A federal judge is going to set sentences, of course, after every single conviction. But Mike, where is your head on this?

12:17Malcolm Harris: Because this is, you know, we joke around on this show a lot when we talk about bananas and avocados and cucumbers. But like people lost lives and this is a real legitimate crime. And there's a transportation tie to this. yeah you know it's it's uh there's it's interesting to me because of a number of factors right and one when i was in maritime you'd see this type of thing every once in a while and it was really because of ignorance than anything than anything else that would happen right so stowaways would they would study a vessel's schedule, right? And they'd have a ring that would know the schedule of the vessel.

13:00And when the vessel changed its schedules, when you come across something like this, okay?

13:06Malcolm Harris: Yeah. So, because they go through different ports, et cetera. And, you know, in the Caribbean, stuck inside of a container with no hair or anything like that, is not a good idea either. And you'd see this. The thing that really strikes me a bit about this are two things. It wasn't ignorance. because it was guys that, you know, it was a ring of people that do this for a living. They were completely. Yeah, that accidentally killed these people. And, you know, negligence, my ass. And because, look, they broke the seal, they put them in there, and then they resealed it, right? And they knew it there, dude.

13:50They've done this 100 times before, right? the other the other thing is because this stuff happens constantly and successfully by the way so when it's when it doesn't work out and somebody dies it's not it's either they did it on their own and thought oh i can do this too and don't think it through but in this case to me it smells like execution murder um which i mean is it far-fetched to think that this was a cartel hit

14:15Malcolm Harris: job that's what i was gonna ask you is like it kind of leads me to think like yo like this i mean The Kaiser Soce go after the family, the cousins, the kids, and generations of people, right? You know what I mean? In the movie. And I don't see why this would be different than a cartel. I mean, you know, you see Pablo Escobar selling you train tickets at the Amtrak. You don't buy them. Yeah. No. You know what I'm saying? Okay, guys. This is a big no right here. This is like, uh-uh. So there's my little bit of humor, but mixed in, I think this leans more towards that than just oops. Yeah, I'm with you.

14:59It really does. Because even if the people that are dead are innocent people, they're family members to somebody, and somebody might be getting a message.

15:07Malcolm Harris: Yeah, I couldn't agree more. And condolences to them. And I mean, yeah, I just... Yeah, of course. I have another angle there, too, as well. I mean, from the maritime side of things, uh mal uh malcolm is you know when it the carrier right the the um the ship owner is responsible for this type of thing okay so like when i was in maritime if we had stowaways we were responsible for their medical condition for providing them medical attention for putting up in a hotel feeding them making sure they were safe and uh exporting them back out of the country We had to pay all those legal expenses. I mean, if somebody was dead or injured, their family could sue us.

15:56And you paid. Because it is part of your responsibility under certain acts and laws to ensure that there's, one, no bombs on your ship, no drugs taped to the hall, no stowaways. Those are the carrier's responsibility. What strikes me is that why isn't the rail responsible as well? I'm literally going to ask you that very question.

16:21Malcolm Harris: It seems like we're on the same wavelength. Why do you think that? You know, I don't know. I think maybe because it's, I'm not 100 % sure. I think in my estimation, it feels like, and I'm not saying that this is accurate, but it just feels like smuggling through ocean is something that has happened for hundreds of years. Rail hasn't been around for hundreds of years. And so it just kind of was part of it. you know what i'm saying like um what's it called when you you share the insurance liability for somebody's loss on the ocean i forget what it's called somebody from a an ocean insurance company could could tell us i forget what that's called uh but you're sharing it right um so these laws and stuff like that have been around because there's been smuggling there's been stowaways there's been this type of stuff on ships for years and years and years hundreds of years right where rail it just wasn't baked into the into the pudding you know what i'm saying i think because i don't see why that why the liability is different i just don't i mean somebody might say well because the rail company has several different shippers on it well have you ever seen a ship it's not all one container on there right you know what i'm saying a whole lot of people putting putting different anyways that's that's something that somebody else has got to answer and that's a good legitimate question why don't they share in the responsibility of this perhaps it would help with some of the smuggling and stuff through the trucks if the trucking carrier was actually responsible for securing their business across borders for sure i couldn't duffy do something duffy yeah i mean that is a very very good point uh check out this article from phil right now um he's had quite the week too a lot of different pieces want to give him some love just hit a million in total views uh for the first time what way to go phil so um sweet i know it's not always the sexiest news and the most positive news but news does that mean he's a millennial uh i think he's a zillennial he's like gen z and a millennial put together that's what i'm a zillennial yeah i'm a zillennial you're a you're a zillennial absolutely absolutely um let's get to our guest man because we got a little bit time all right we got two interviews We got about 25 minutes or so, so I'm excited for this first one.

18:41Malcolm Harris: Again, he needs no introduction, but think very, very highly of him. He's a co-founder and CEO of EV Realty, and we're going to talk all about electric trucks and what it takes to be able to maintain the process and what goes through the process and why it matters so much in trucking right now. He has the credentials, and we're going to talk about his credentials because his background, Guys is one for the ages right now welcoming Mr. Patrick Sullivan, co-founder and CEO of EV Realty. You are now on What The Truck. What's happening, Patrick? Gentlemen, good to be with you. Good to have you. Good to see you, Patrick.

19:19I just want to let you know, Patrick, I have to say this because our lawyers tell us now everything that happens from now on is your responsibility because you accepted this invitation. I'm up for it. I'm up for it. I'm just kidding. But you're a Princeton grad, right? I am. I somehow snuck in, yes. Well, I think you ran in, didn't you? Or ran around it. You were cross-country and track. Look, check it out. There you go. Look at that guy right there, boy. Look at him right there. Yeah. It's wild how you have not aged at all. I mean, zero.

19:54Malcolm Harris: Zero. Not an ounce of fat on that guy, man. Look at him. No, no, no. No. He's got like 3 % body fat. I bet he's got abs. The interesting thing about this, you know, he went there. There's two famous people from the school. Well, one of them's like, I think, forgotten fame, right? Princeton has, don't they have a moon flag? Isn't that right? Charles Pete Conrad, class of 1953, is actually the third man on the moon at 1969. And there you go. Princeton has, they've been to the moon. He actually said that was one small step for Neo, but one really long one for me, I think is what is famous. There it is right there.

20:42I think we got footage.

20:43Malcolm Harris: Oh, we got footage for sure. Cody Dowling, you are a man amongst the boys. That's top tier. That's it. Y 'all are way too good with the AI. That's fantastic. That's actual footage, people. Don't let him fool you, bro. He was trying to steal the limelight. That's what he does. he's well michael who's the other one who's the other what the other famous person it's charles pete conrad it's you and charles pete conrad man who was the third man on the moon nobody nobody even remembers you were actually the first nobody knows that because you were up there you were like warming up and stretching out and that type this stuff before you jumped out there right but if y 'all had seen me back in college i didn't really run my way onto the team i showed up the first day and i had to reintroduce myself to the coach so um i was i was chasing anybody else but i got who let this guy on where did this guy come from exactly y 'all are crazy now and now look it's safe to say it worked out kashik i don't know i I'm being biased, but I think it worked out.

21:54It did. Yeah, and you know what? I still love to run. I wish I looked like the guy on the moon there, but I still get around now and again.

22:03Malcolm Harris: Yeah. I love this video. I can't stop looking away from it. Cody, that is fantastic. It's just great. You're so talented, Cody. Listen, let's talk about what we came to talk about because we are going to talk to you about running on the moon for the next two hours. I want to be mindful of your time, all right? So with that, let's just see. Charging infrastructure is one of the biggest conversations right now in freight. We know this. I mean, it's something that is always coming up. I guess my question to you is why is this such an issue right now? And then also tell us from a 50-foot lens what you and your team are doing when it comes to this right here, right now.

22:43Malcolm Harris: Patrick. Yeah, sure. Well, I think it's a really big issue, primarily because the electric trucks, especially the heavy trucks, are moving past the pilot phases, right? I mean, there's probably, I don't know, 2 ,000 heavy-duty electric trucks on the roads here in the United States right now. But to really scale them past the pilot phase, you need that fueling infrastructure in place, and you need it in the right places. And as you start to see fleets, especially here in California where I live, really adopt these new trucks at scale, you need the infrastructure. And building this infrastructure isn't easy, whether it's navigating the grid, the permits, just the physical connection with the utility.

23:33And then you're competing against, and I'm sure y 'all are not going to be surprised by hearing me mention data centers, you're competing for that power with all of these other uses for electricity. And as big as some of our sites are, data centers are looking for 50 times more power than we look for. And right now, an average site for us is 5 ,000 to 10 ,000 American homes worth of electric fuel. And so that's hard to find for these fleets. And when you find it, it really gives those fleets that want to electrify more than one or two trucks a real advantage. And so, Malcolm, to your question, that's where we come in.

24:12I built this business. The name is sort of a little on the nose, but the name says it all. We look for locations where you've got that combination of significant amounts of grid power near where heavy trucks operate or where they work. and then obviously industrial real estate, which I know you all think is super sexy. So I'm glad to jump into that as well. It actually is super sexy. And one of the reasons it is to me is because when it says EV reality, it says what you do, but not really. I think it makes it a little bit more incredibly simplified, right? Because you don't just go, hey, look, that land's available and location, location, location.

25:00It's fantastic. there's so much more that goes into it right i mean when you say we talked about uh infrastructure is now a hot topic it was a hot topic before the electric vehicles even came out because everybody was like well the grid can't handle it well yeah it does well copper is in demand and now it's going to be a precious metal which it already is all these type of things there's no way we can we can have this how do we figure this out there's no way to do it when you talk about your reality and you touched on different aspects of it. How does that work? Because the rollout of EVs, all of us that are out here outside looking, really, and Malcolm Meyer is inside as most people are, but we're still outside looking because you're the inside guy, right?

25:45Yep. How is it rolling out? If anybody knows how it's rolling out, it's you. Because we used to argue, well, it's going to be all over the street. And I'd be like, no, no, no, no, no. It's going to be in closed areas first. and then out and back in the same day type of stuff. Where is the demand for this real estate and how does that work? As far as how you see the rollout of these EVs, right? Yeah, especially for the, let's separate passenger vehicles and heavy trucks, right? Yeah, yeah, yeah, of course, yeah. If you think about a typical electric car, the batteries, the amount of electricity that these vehicles use is like five, ten times as much as one electric vehicle.

26:30So again, like a lot of electricity is needed. And especially early on when I started, I started the company about five years ago. The electric trucks that up until now have really been on the market are best suited for activities near and around the ports. And a lot of the major sort of logistics areas in the country. So whether that's the Inland Empire of Southern California or the Dallas-Fort Worth Metroplex or the Chicago area. And Michael, you're right. It's initially sort of out and back trips. I know we're going to talk a little bit about drayage, but that's a pretty ideal first application for these vehicles because they're doing relatively short laps from the port to a transloading facility or maybe all the way to a warehouse and they're trying to do that two or three times a day, which is really, and I think, Malcolm, you know this from your background, like you get two turns on a drayage truck, you're doing okay.

27:34You get three turns out of the port, you're doing great. And so a lot of the initial use is really around those port applications. And gradually as the vehicles get more range and are able to do more work, you're starting to see expansion to regional routes, but you're not yet. And it's going to be a while before you see like long haul over the road, six, 700 mile trip type of electric truck activity here in the United States. And as much as that has to do with the infrastructure as it has to do with like the trucks can't go that far yet. All right.

28:10Malcolm Harris: No, that makes sense. I want to ask, I mean, when it comes to adoption and really just like, I guess, digesting EV, I mean, are fleets and organizations, what are you hearing? Is there resistance? Is there, I mean, a nice, I guess, attention or a mindset when it comes to it? I mean, is there a split decision when it comes to it? What are you hearing? You know what? It really depends upon the fleet. I'll give you a great example of a customer of ours who's based right near the ports of LA and Long Beach. And this is a small company. I think they've got 40 tractors, all of them diesel. and I was talking to the founder and the CEO of the business.

28:58He's like, I breathe this air. When you think about the diesel and the particulate emissions from these trucks, and Malcolm, again, you'll know this, like ports are where, drayage is where trucks go to die, right? Those are the oldest, the dirtiest trucks, right? Companies like that are doing that because they really understand the benefits to not just the community, but frankly, to their families. He said to me, he's like, this is the air my kids breathe. Like he lives in Carson, California, which has some pretty nasty air. And a lot of that is because of trucks. So you see some companies that are doing it because of the benefits.

29:39You see others that are really only going to do it. And this is where I get excited is because you don't want to do it just to feel good. you want to do it because it actually makes economic sense for your business. That's where you see the tipping point coming is because these trucks are starting to get to the point where not only are they comparable on a cost per mile with a diesel rig. And certainly over the last couple of months with the price of diesel, like they're in the money by 30, 40, 50 % sometimes. But you're starting to see a lot of lanes and a lot of routes where an electric truck makes more economic sense.

30:18That's the tipping point. Nobody wants to do this stuff at a premium. I don't know about you all, but the last time I paid for shipping, I think I might have been running at Princeton. So it's been a long time since somebody was willing to pay to get their goods to their house. Were you receiving NIL money? No, I'm not going to go into that. I had to reintroduce myself to the coach, Michael. So no, no, no. Yeah. Cause he said, who is this kid who just pulled up in a Lamborghini? How's he getting his NIL money already? What's going on here? No. So I'm interested in how this develops, right? Cause you, you look for, you see a location, you say, okay, density should be good here.

31:01How, how do you do that? Are you, is this speculation? Are you spec building these things or how? Because it doesn't sound to me like you're building these things for a specific entity, but for a specific region of entities that are moving things. So how do you understand that this one is the right investment? Are you just saying, hey, look, EVs are coming, here's a density of trucks, and therefore this is going to work? Or is there a group that goes in and says, yeah, we're going to start moving? How do you find that location aside from the power grid and all that kind of stuff, which is probably the hardest part I would imagine, but how do you get that density?

31:39Yeah, look, it starts with data. And maybe to take a step back, before I started this business five years ago, I spent the first 18 years of my career building power plants. And when you build a power plant, the first thing you figure out is like, when you plug that thing into the grid, what happens? Do you have to build a bunch of new transmission lines? Do you have to build a new utility substation? Well, the same thing works if you're thinking about where power exists that you want to use. If it's not there, it's going to take a long time for the utility to upgrade all of its wires and its infrastructure to allow that electricity to flow.

32:20So you said it at the top, Michael, it is location, location, location. And in the case of us, we use data, first of all, to find where power exists that you can take off the grid without without a bunch of expensive new stuff being built by the utility. Then you look for that significant concentration of trucking and warehousing and logistics activity. And then most importantly, you start to identify where those fleets are that have the lanes, the routes, the operations that make sense for the electric trucks. So while we do buy the real estate and secure the power on spec, we don't build these things on spec.

33:05We're really trying to find those locations where after we have controlled the real estate and the power, we engage with fleets, trade freets, regional carriers who have expressed interest in that location. And then when we build these, we're building them for multiple fleets to use. We're also building sites off our portfolio for single users. And we refer to those as sort of build to suit opportunities. But these aren't spec houses. I mean, I don't know about y 'all, but I'm not yet ready to build a 15 or 20 million spec house each time I buy a piece of property. So we'll buy the land, we'll secure the power, and then we'll work with the fleets to try to make it something that works with their operations.

33:51Gotcha. Gotcha. That's interesting. Are you locations, are you looking at the strategic, like I have an electric vehicle, right? A car. And it's super easy to go long distance across the United States. It's really easy. The app for the car, you say, hey, I'm going here and it maps it out. Right. And there's charging stations, supercharging stations everywhere. And they're agnostic, relatively everywhere. And the good thing is they're in places where you want to be anyways. They're not like in the middle of nowhere because why would you build one in nowhere? When you're building these things out, it's the idea that eventually these hookups so that you do have this infrastructure network across the United States that you guys have that is now trucks can do 800 miles, 900 miles.

34:37Is that how this builds up? Because that's kind of how cars built out, right? Eventually, it's got to get there. We're starting a little bit smaller, but with the same concept. So the first big fleet hub that we built was in San Bernardino, California. I think we're surrounded by something like just within five miles of our site, something like 5 million square feet of logistics space. And so you could think about the truck activity just in that area. We're also about 70 miles from the ports of LA and Long Beach, which have, I think, 40 to 42 % of the container-bound freight into the United States comes through those two ports.

35:17And so our next site is in Florence, California. It's five miles outside of the port. We're now creating that network opportunity for our customers such that whether they're running sort of drayage routes around the port or they're doing longer lanes out to the Inland Empire, they have a solution just within our ecosystem at both ends. And gradually you expand there. The natural extension from that might be Las Vegas, Phoenix. And then eventually, I think you're really going to see some of the first national corridors expanding eastward from the port of L.A. and Long Beach to Texas. But you're right, Michael.

35:59It's going to eventually have to be very similar to the network that we all get to benefit from for passenger vehicles. Right now, especially with the range, we're taking bite-sized trucks. I want to get those fleets comfortable with going 150 miles round trip and knowing they've got charging on either end. Right, right, right, right, right, right. And it would just feed right into their ELD and their location, et cetera. Yeah. And we work a lot with our customers to understand their lanes, right? And then we also work with a lot of the brokers and the logistics companies to understand which of those lanes have the right type of freight.

36:38Is it cubed out? Is it weighted out such that it actually makes sense for an electric truck, right? These trucks can't do all the same work as a diesel truck yet. They're a little heavier up until recently with the Tesla Semi coming. They didn't have the range. Now they've got plenty of range, which is pretty sweet thanks to the Tesla Semi. But we're really trying to use as much data as we possibly can to make this a decision for fleets where it fits with what they do. asking a a carrier to really transform the way they work with their customers in order to get into an electric truck is a non-starter right it's like i said earlier that becomes a premium product decision and this is a commodity business right it's it's fuel and miles and driver downtime and and vehicle maintenance and you have to optimize around all of that to make sure that if you're going to replace a diesel rig with an electric truck it actually makes economic sense for the customer.

37:40Malcolm Harris: This is insane, Patrick. So I guess last question because we're about to get to John Nolan, but I guess for EV Realty in five years, what does success look like? Like if you're just sitting on the patio, drinking a cup of coffee, feeling good about where you're at, what has had to have happened in order for you to feel that way? And then also, where can we get information about you and your team so we can share it with the public? Because the work you guys are doing, And this is, this is incredible, man. Appreciate that, Michael. All right, Malcolm. Thank you. I would say in, in, in five, 10 years, I would really like to see electric trucks at 15 to 20 % of the total trucks on the road.

38:23I started this business really because I wanted to tackle the next challenge of decarbonizing our, our sort of air. You think about all the work that's been done around power plants. We're well on our way, whether it's wind, solar, batteries, nuke, hydro, to clean that up. Well, 25 % to 30 % of the emissions from all vehicles on the road come from about 7 % of the vehicles on the road, which are the trucks. And so I would love to see in the next 5 to 10 years a significant portion of those be electrified. That's going to happen with better products, both on the charging side with companies like mine.

39:05And then, as I said before, better trucks, trucks that can go four or five hundred miles on a charge that aren't seven to eight thousand pounds heavier than the diesel rig. So they can move all. So if that's happening in five years, I will happily be sitting on the patio outside me here enjoying life.

39:23Malcolm Harris: That's real. That's so real. Again, Patrick Sullivan. This was fantastic, man. I really appreciate you being here with you, representing, of course, EV Realty and can't wait to have you back on the show, because I feel like we just scratched the surface. I've got like 15 more questions, and they keep coming every time you... Michael, hit me up. Look, y 'all, this has been fun. I've really enjoyed listening to your show. Let's do this again. And you know what? Malcolm, to answer your question, our website, which is everealtyus.com, I am sure my team is going to be emailing y 'all and asking for that video.

39:59So that's going to come up on the website to see me running. but lots of we got you

40:07Malcolm Harris: we'll get that over to your team I'll sync up with y 'all after the show necessary Cody we'd have to start giving Cody royalties or something Cody is really the secret sauce in the Big Mac we appreciate you we'll talk to you soon take care guys just a little bit left here on the show which has been an awesome one but we can't end it without the closer All right, because every great team needs a closer and this guy's going to shut it down. Oh, yeah. He's looking good. He's looking dapper. He's looking ready to go. He is the co-founder and CEO and a chief systems architect. I like that. I like that.

40:44Malcolm Harris: He is representing Cypher and Row. He is Mr. John Nolan and he is officially on what the truck. John, hello, sir. Good to see you. Good to see you.

40:57Malcolm Harris: Oh, if we don't have audio, I'm going to be so sad, John. Are you muted? Oh, no. I heard you. I heard you. Oh, am I there? There we go. Okay, great. Okay, perfect. Well, happy to be here. Happy you're here. Happy you're here. It's good to see you. How's everything been going, man? Thanks for being here on the show. Yeah, life's good. Yeah, really interesting stuff. Mike, did I hear you say you actually were in shipping and worked on boats? uh i yeah well i ran the container freight stations uh in uh the caribbean central south america and and eastern u.s for for uh a carrier tropical shipping back in the late 90s early 2000s yeah yeah but not as interesting as your background which is obviously your background is perfectly set for you to be chief systems architect at cypher and row and dealing with fray fraud and that type of stuff because i mean your your resume is is impressive i think you left one thing out of it though he he was a mixologist oh was he really he was a mixologist at one point which you know is kind of like you ever see the movie cocktail yeah i've seen the movie actually yeah tom tom cruise was actually a mixologist you know i'm saying i thought we footage.

42:17I thought we had footage of him doing his thing. Maybe not. I thought we did.

42:22Malcolm Harris: We may, we may not. I don't know. Give me John Nolan over Tom Cruise any day. I think we do have some good. Oh, no, but we do have this. This comes from Colorado State University. In 1919, somebody stole their bell that they were ringing for classes, and then they started ringing it for football touchdowns, and that type of stuff. And it was gone for 97 years until it mysteriously reappeared and they never knew who did it. We've got the evidence right there. We did investigative journalism and we found John Nolan polishing it up before he returned it to the campus. That's so funny. I've actually met some of the alumni who may or may not have known and potentially returned it, but I can't say more than that.

43:12I got you. Because it was gone for 97 years. It was gone. And when it got it back, It was like nobody knew who got it, but it was like cared for perfectly. It was like in perfect condition when they got it back. So somebody, someone probably just had it in their bedroom.

43:29Malcolm Harris: John, for those that don't know, give us a 50 foot lens, Cypher and Roe. What do you do? Obviously a lot in the space. You got such a lot, but what is the overall arching theme about what you and your team do? Yeah. So we're creating the audit trail for freight vetting. and we're creating some AI tools that allow customers to automate what they're doing, especially with onboarding. We definitely have a packet scanner that basically the documents you get from a carrier, it can scan those documents and then try to catch discrepancies and work with our trust scoring system that uses FMCSA data. So you're using character recognition and AI to then research and decide whether this is legitimate paperwork or not.

44:16Is that right? Yeah, kind of because part of the fraud that some people do, you know, they'll try to maybe use like a similar email. So it finds like little mismatches and also flags maybe like reincarnated carriers, especially like FMCSA data. You know, it's just going to show like the most recent score. But we're starting to compile a history of all the scoring so we can catch chameleon carriers. If they come back, you know, we can catch like the same phone numbers, same email addresses, things like that. Is this in the front end, in the door vetting of the carriers, or do you move this into the transactional type of stuff?

44:53That's a great question. Transactional as in like working with the loads? Yeah, yeah, exactly. Like when at pickup or assigning a carrier a new load because it fell off out of your routing guide or, you know, the carrier dropped out and you're picking up a new carrier, these type of things. instead of like when you're bringing in a carrier, I look at it this way. When you're bringing a carrier and signing a contract, like, okay, we're going to do business with you on these specific lanes or these areas. That's like in the front door. But when it's like somebody you don't use all that, it's like a one-off type of thing.

45:27That's like through the window type of thing, right? It's like, okay, this driver's at the pickup and we're going to do it. Yeah, that's definitely something you would want to use us for because we're definitely going to be able to vet that carrier. But something else we do is like carrier monitoring. So if, say, their insurance lapses or something like that, maybe you're not checking this daily. So you would get an alert right to your email.

45:56Malcolm Harris: So my next question is, like, when it comes to carrier vetting specifically, now it's almost, I mean, given everything that is happening in this space. Yeah, you got to simply say, like, yo, I vetted this carrier, but now you have to demonstrate how you've actually done it. I mean, are companies expected to do that? And if so, when it comes to due diligence, like what are the number one things that you're just like, listen, you have to have A through F in order to even be kind of in the green when it comes to carrier vetting? Yeah, 100 percent. I mean, things are changing so quickly, especially after Montgomery.

46:33And you definitely have to prove like that you've actually done the work and you have a paper trail. and what you were saying with the due diligence I think it comes down to three things really it's are they who they say they are are they legally allowed to haul and then are there any red flags for their history as well okay

46:55Malcolm Harris: I mean that's a solid thing all the way around is your industry do we have time for more questions or yeah yeah yeah we're good on time we're good on time Izzy said you know what listen this is a good episode let's let it ride so we gotta look All right. Look, John, you got on Izzy's good side. That's good, man. Izzy's the man. Listen, my question is this, because you're talking about the more exposure to the brokers, et cetera, and doing the vetting, like Malcolm just said. Is there an effort or is there the idea to effort to lobby at least Congress or get Duffy or somebody to start to define what is legitimate or acceptable due diligence?

47:37Or do we just have to wait for things to get fought through and figure this out over the next 10, 15 years and nuclear verdicts and that type of stuff? Is the industry trying to come up with something? Yeah, I 100 % agree. There needs to be a set standard of, hey, if I do these checks, I'm clear and I'm good. And I think the paper trail to start is going to be huge. Because a lot of people, they've been maybe running for the last 20 years and they said, hey, I've been doing it this way. I'm fine. But it's kind of like health insurance. You don't feel like you need it until you have something come up and then you're like, oh, I wish I had that.

48:16So setting, just covering your bases, you know, and setting yourself up for success, and just making sure you're doing that.

48:23Malcolm Harris: So I want to talk the AI angle for a quick second, because you guys are rolling out what packet scanner, and it's identifying these different signals of fraud that might be missed during like a manual review. But I guess there always needs to be a human aspect when it comes to brokerage. And is the goal, I guess, to replace the human aspect or is it more so to give brokers more information to make educated decisions and uh you know be able to to assume the risk but just know and of the imminent risk you understand what i'm trying to say john yeah yeah i think yeah 100 would i don't think you even could replace people and it's i wouldn't say it's the safest thing to do we want to make people faster so they can take on more work, maybe just save time so they have more free time at home.

49:14So all of our checks, we're kind of setting it up so that basically the human's in the loop, you know? But we are also setting up, we have set up like the MCP, which for those that don't know, that allows you basically to use R tooling with like ChatGPT or Claude, it's my personal favorite. And it can natively use R tooling and you can basically call the FMCSA to get that data and then cross it, check it with whatever you're doing.

49:41Malcolm Harris: That makes sense. Now, I guess my next question too is, if you didn't document it, it didn't happen. That's the saying. Documentation purposes when it comes to carrier vetting and things that people need to be doing. What are the big, big, just, I guess, pillars of documentation that you're just like, hey, if you don't do this, I don't feel bad for you whenever you get a slap on the wrist. Yeah. I think a lot of people aren't even doing it. And the other part is having a third party, you know, like what we've created. It timestamps everything you do when you've done it. So you're covered. If you have, say, like an issue or your lawyer is like, hey, we need evidence.

50:25You did your checks on this date. You're going to have to have already had that in place. And if you're someone like us, I know a lot of other big companies are also starting to build this into their systems. but it's just going to cover you. For sure. Mike, I'll defer to you. Can you talk to the opposite side of that? Because what Malcolm said is right, but there's two sides to every coin, right? If you document it, if it's no documentation, it didn't happen, right? But sometimes if they document it, then you're proving it didn't happen. In other words, you've got the checks and balances time stamped and you didn't do anything.

51:03You can accidentally expose yourself, right? So when you're utilizing your type of system, et cetera, how important is it to actually act on all the information you get? I think it's going to make the freight industry better. Like you said, it is going to hold people accountable. So you actually have to do the work. And if there's some red flags, you are going to have to have real defendable reasons that say, hey, there was this flag, but I cleared it by doing X. And, you know, if you're a company that's cutting corners and, you know, then yeah, you should be liable. So, yeah. I think that's where the law comes into play, right?

51:47All the statistics, right? We did this, but we didn't do that because of X. That starts to do your framework of what due diligence is and what it isn't, right? How you react to those things?

51:57Malcolm Harris: Yeah, absolutely. If you're a small or medium-sized brokerage and you're just like, well, this all sounds great, what he's saying. He can't afford it. Don't have a compliance team. What's your biggest piece of advice for them to do right here, right now in 60 seconds? I would say it's to set up SOPs for your company, what you do every single time you're onboarding a new carrier and just stick to that. And if someone's breaking your SOPs, maybe don't go with them. Don't take the risk. Ladies and gentlemen, John Nolan with Cypher and Row. John, thank you so much for being here on the show. All right.

52:34Malcolm Harris: Thank you again. Fantastic. Appreciate it. Appreciate you. And appreciate Patrick as well for being here on the show. It was a fantastic one. And my man, Michael Vincent in the chamber. We did our thing as we always do. Let's take a look at the road ahead because the road ahead is going to be a massive one for Friday's show. the last show for the month of July. Sami Khan is the co-founder and CEO at Navoya. Sami is going to talk with us about a lot pertaining to Dredge. There's going to be a lot in terms of just the overall systems of what Navoya is doing, some really good stuff. And then we're going to go directly to the trap.

53:14Malcolm Harris: Matt Trap is going to be on the show. He is a vice president of operations at Cox Fleet. A really, really, really good interview with Matt pre-show. So I think you guys are going to get a lot of value from Matt as well as Sami. It's been another episode of What the Truck. Make sure you like, subscribe, follow, do all the things. For myself and Michael Vincent, it's peace and love. We'll see you on Friday. All right. Right on, boy.

54:01We'll be right back.