JB, thank you for joining us. This is a special moment for you, right, receiving this award? I'd imagine it's up there.
This is pretty cool. Thank you. I really appreciate the recognition. It's a great honor, and as you said, incredible company with some of your previous recipients here. I'm used to staying a little bit behind the spotlight sometimes. I prefer to be one step behind things and just get stuff done and make it work. It's unbelievable to see how this industry has grown and the scale we're at today, and also where we're going. We're not done yet. So anyway, thank you so much. This is humbling, and I really appreciate it.
More than welcome. Did you think my thoughts on the election were too optimistic? Were they too... I'm trying to think this one over.
I echo your optimism, actually. As we were joking beforehand, I'm an optimist at heart as well. I think we kind of have to be in some of these markets where we're building, trying to create change and innovating. I am cautiously optimistic about the future of this industry in the US in particular and what this administration can benefit from and do here. We obviously can't change the current reality of what we have in the country, and as you've highlighted, the Republican states stand to gain a huge amount from this. This is fundamentally an industrialization activity that we're in right now. We're scaling up, building mines, refineries, manufacturing sites. That's a different shift than where we were even four or five years ago, when it was trying to figure out the incentive structure to accelerate this. That's happened now. We just need to make sure it's going in the right direction and it's balanced.
When you built the original Gigafactory in Nevada, you were saying actually most of that did happen under the Trump Republican administration. He just talked people through that story.
Absolutely. Tesla, prior to Redwood and even Redwood, we've gone through multiple cycles of Republican administrations, Democrat administrations. This is a bipartisan issue if there ever was one: energy security, jobs, environment as well. In the beginning with the Gigafactory, that was really linked to a supply chain necessity for the EV, for the Model 3 at the time. It was a pretty audacious, amazing thing. We had this concept to go and build several hundred thousand EVs, which was 10x more than anyone had ever done successfully or sold. The first big question was, will anyone even buy that many EVs? But we also knew that if we actually wanted to succeed, we would have to have the battery supply, which didn't exist. So we had to preemptively start the Gigafactory project before even knowing if the customers would come or if the sales would come. That was a nail-biter. We literally had to bring the supply chain in, in our case Panasonic, and they were the first real battery maker to take that leap and commit to that factory and that supply chain before knowing really what the customers were going to do. I specifically remember the launch event for the Model 3. It's a distant memory in the EV industry now, but it was a pivotal turning point. There were lines around the block, like an Apple iPhone launch. Over the course of maybe three or four days, there were several hundred thousand reservations, and it blew all the expectations away, even from inside Tesla at the time. I remember coming back to the office and thinking, holy crap, we need to make this thing bigger. We had gone as far as we could with our planning, and we doubled it almost one week to the next.
Can I pick up on that, JB? I'm really interested, and I think a lot of people in the room will be interested. What you described you did at Tesla was really creating a whole ecosystem for the company. I think we're starting to see some of that around your plans at Redwood. I'm really eager to hear what you think the importance of creating that ecosystem is. We have a very fragmented, diverse supply chain, lots of people specializing in lots of different areas at the moment. But maybe there's an argument to push things forward at speed, which we need to do, that you do need to create that ecosystem yourselves under one roof.
Well, in the beginning of the journey at Tesla, some of that was by necessity because there was not a supply chain. We couldn't go out and buy a battery module or a motor or a charger from any other companies. There wasn't that supply chain. So we were kind of forced to say, well, we can't buy it, so we better figure out how to design it and build it. That actually led to a really inherent strength that I think endured and still endures for decades: tight integration, really excellent engineering optimization across all those physical components. That's benefited Tesla massively. It's a tightly integrated architecture across that whole vehicle and all the vehicles they make today. But that's now extending and needs to extend to not just the functional components but the batteries, the materials, the active materials, even the minerals. I think as we get to these scales, that dependency and the risk of having a supply chain that's global and subject to crazy geopolitics and maybe tariffs, which could be highly volatile, all that really hit home through COVID. It highlighted that massive risk of the supply chain that was even outside of the kind of dysfunctional module ecosystem. So Tesla was one of the companies that took some of that to heart and has launched a lot of initiatives to begin to make a more tight ecosystem. But at Redwood, one of the opportunities I saw early on, back pre-2018, 2019, was to help architect that for the whole industry. I think this is a fundamental opportunity across the whole electrification industry—cars, trucks, even stationary—to architect that business ecosystem, figure out how to technically refine and reintroduce these materials. I just saw this huge gap. There were no companies owning that. There was no incumbent technology or business architecture for it. But you could look at the physics and say, in 20, 30, 50 years, this is going to be the majority of the material flow. Most of the nickel and lithium atoms in that ecosystem will be flowing in a loop. How would it work? No one could say.
Why do you think that was? That people just didn't connect the dots? Is that a wider culture of not building stuff for so long, or is it something else?
I think it's twofold. One is it's far away, and it seems infinitely far in the future. When you start to think about something that's relevant as the whole EV market matures and starts to reach some kind of steady state and turnover, people just say, okay, that's maybe 10 years away before this car comes back. It's too far to think about. That put blinders on people. I think the other was just that it's unintuitive that these materials can get reused with such high efficiency. We're so used to a petroleum and fossil fuel ecosystem where things go from extraction to refining to consumption, and that's the end. Then we worry about CO2. But this is fundamentally different. It's unintuitive. I don't think most people have realized that even though it's obvious and quite simple, it's unintuitive that these minerals can go into an application and then they just stay there. They don't get lost. They're 100% contained in the application, so they are all available to get remanufactured and reused. That is a fundamental difference with the electric infrastructure and ecosystem we're building so quickly now versus the petroleum ecosystem that helped power that construction and is still helping today.
