Pilot CEO Adam Wright on EV charging: We think demand is going to push through

Joining us right now is the CEO of one of Berkshire companies that is celebrating CEO’s who’s celebrating one year in that role. We want to bring in Adam Wright. He is the CEO of Pilot. And Adam, great to see you. Thank you, Becky. It’s great to be back. It’s great to be back in Omaha, my hometown. My thoughts and prayers are obviously with everyone who’s rebuilding those last year. Yeah, those were devastating. I’ve seen a lot of footage from it, but it looks like people are up and ready to go and things are going to go off as usual here. That’s right. So normalcy helps. Yeah, it does. Adam, I want to talk to you about everything you’re doing at pilot right now. So this is a company that Berkshire bought out, right? But the remaining tranche of it back in 2024, I think the final price paid was $2.6 billion. It was a 2023, a total of 13 1/2 billion dollars to buy this company. Now you’re in charge and you are spending a billion dollars renovating, change, changing, updating, remodeling things. What what do you see on the ground, What has to be done? Yeah, I think first, we have a great brand. It’s a 65 year old company. We’re in 44 states. We have more than 800 outlets and it’s a brand most people really haven’t heard of until here recently with the acquisition from Berkshire. And we have an opportunity to upgrade our stores and we’re focused on doing that. And that’s in the billion dollars like you said to upgrade 400 of those locations to bring them into the future, a much better guest experience, shopping experience. We want to make sure we’re preparing for electrification of the transportation sectors. We’re putting in EB chargers at several of those coast to coast. We just have to bring our stores up to really give a great guest experience. What what was kind of lacking in the guest experience before what where where are you focusing those that money at least in the stores. And then we’ll talk about electrification. Sure. Some of this to bring food forward, just making sure we have a great deli experience. Others is making the aisles wider, they call them gondolas, but pretty cramped in there. So we’re trying to give more space so that guests can move around the stores more freely, bringing our showers up to date. We do over 70,000 showers a day because these, this is where truckers pull in, They’re going to come in, have a meal, get refueled, take a shower, refresh exactly right pumps, parking lots, really just upgrading the whole aesthetics of the experience for the customer. You know, trucking is a pretty major industry, an indicator of the economy. So what what do you see right now just in terms of how truckers are feeling, how much is moving, how much freight is moving on these on the highways? Well, this is a tough time for truckers right now. Trucking’s a tough industry generally. So you have a capital intensive business, you have high turnover, you have a low margin, it’s cyclical, it’s seasonal. If you have one or two of those, any business, it’s really going to be pretty challenging. Trucking has all of it and we’re in a pretty, you know, down cycle right now, mostly because freight rates, there’s too much capacity from a trucking standpoint for the freight that needs to be moved that depresses rates. And so it’s making it very challenging for the large and the small truckers. Is that because there’s less freight that needs to be moved or is this relative to pandemic level highs? When a lot of stuff was moving, we’re actually starting to see the inventory levels come back down. They were a little bit bloated coming out of the pandemic. Those are starting to return back to normal level. So we do expect some of those inventory headwinds to start to move out of the way. It’s really just Nova capacity during COVID and the big boom, you could buy a truck and get high rates $4.00 a mile. That allowed a lot of 1/2 fleet operators to come in to play and that really just created over capacity. So now that has to work its way out and then things will start to level out. OK, your background is in energy. You came from Berkshire Hathaway Energy, moved on to another company. But you, you really grew up in the energy industry. And what you’re doing right now is trying to make sure, as you mentioned that you are looking at all ways whether that’s going to be any sort of fuel or any charging levels. You’ve got a partnership with GM. What are you doing with that? What’s the electric electrification and charging stations you’re putting, right? And so it’s important for us to really be fuel agnostic and guest focused and we want to keep up with the speed of value for our customers. So how is the economy moving and what offering do our guests want? EVs clearly have made a significant run and they continue to grow and we think there’s going to be demand despite some of the challenges here recently. You know tell us obviously about how there there’s not as much demand for E VS and people would rather have hybrids. Have you seen that play out too? We we have, but I think it’s going to push through in one way or another. I think having charging infrastructure at our stores is going to be welcomed by EV owners. We see it 40 to 50% increase in charging sessions and energy dispense on weekends and holidays. Really that says EV owners want to take their EV’s from, you know, urban settings and take them across country. So we’re starting to see an uptake in that. But our goal is to build out 2000 charges at 500 locations by 2026. We’re making good progress overcoming a few challenges and thinking through how to, you know, work with the multiple utilities across 44 states. What are the challenges? A lot of this infrastructure in the infrastructure built on the utility side, a few of us just learning some of the technology and how to even price the electricity that we sell to make sure that it’s economical for us and it’s priced fairly for the customer. We’re working through that, but we’re making a lot of headway and I feel good about it. How fast do the chargers charge? Are these superchargers are these ones that take 1/2 an hour and somebody goes in and takes a shower. In the meantime, what’s what’s your model that you look at it, That’s it, It’s about that 30 minutes. We want to be able to get up to an 80% charge. And so these are very fast chargers, 350 kilowatt chargers. That means anything to anybody. They are the they are the fastest on the market right now. And the idea is that you give amenities to EV drivers that they customarily don’t have. So that the EV driver, if you’re driving across country is going to seek out one of your places and figure I can get everything done there, right? And you have a canopy so you can charge outside the elements. You can go in and get a hot meal. You can relax, walk around. Hopefully you buy, you know, some products to take with you the rest of the road trip.