EVLN: J.Rogers’s Local 3Dprints your customized EV.us> nomadic résumé

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EVLN: J.Rogers’s Local 3Dprints your customized EV.us> nomadic résumé

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An Ex-Marine Wants to Print Autonomous Vehicles for Your City
February 16, 2019  Jeffrey Rothfeder

[images  / Lyndon French for Bloomberg Businessweek
(animated.gif)  A time lapse of Local Motors’ 3D printer as it prints an
Olli minibus

Local’s self-driving Olli under construction

From left: An employee carries tires at the Knoxville headquarters; a
miniature 3D-printed Olli

Local’s Knoxville headquarters

From left: 3D-printing Olli; the metal material used in the process

(animated.gif)  Close-up of Local’s 3D printer

Rogers and employees with Olli’s skeleton

Jay Rogers’s company, Local Motors, has buyers lined up.

On an isolated stretch of industrial flatland outside Knoxville, Tenn., a
minibus is taking shape in a car factory unlike any other. The space is
small, the size of a supermarket, and all but tool-free. No pneumatic pumps,
no shuttling parts bins, no robotic arms or conveyor belts carrying
skeletons of cars. Instead, perched in the center is the world’s largest 3D
printer, a gangly 10-by-40-foot behemoth with a steel-gray exterior, thick
columnar footings, and derrick-like roof beams to true its frame.

When the print heads are in motion, the equipment emits little more than a
whisper, dexterously cutting sharp angles and rounded edges. Programmers on
laptops and quality-control experts with tablets mill around, inputting
design changes and fine-tuning the minibus’s sensor instructions. Beyond the
assembly room lies a kind of alchemist’s playground, where young staffers
with advanced degrees in materials science and mechanical engineering
synthesize nanopolymers or test exotic particles for strength or thermal and
electrical conductivity.

[image]  Jay Rogers, CEO of Local Motors.
Photographer: Lyndon French for Bloomberg Businessweek

The minibus, named Olli, is the latest offbeat product from Local Motors
Inc., an 11-year-old startup. Costing around $400,000 and standing
hunchbacked at about 8 feet tall, 7 feet wide, and 12 feet long, the
self-driving electric bus seats 12 and can be hailed by an app. It was
designed to ferry people around crowded urban downtowns, shopping districts,
and large campuses and to help the elderly get around in suburban
communities with little public transportation. And the minibus can be
manufactured to order, so it could end up as a clinic on wheels, a roaming
soup kitchen, or a traveling classroom. Olli also has sufficient artificial
intelligence to converse with riders. One day, company co-founder and Chief
Executive Officer John “Jay” Rogers hopes, it will be sophisticated enough
to share a modified pesto recipe with a passenger, then reroute him to the
grocery with the freshest sun-dried tomatoes.

Olli took its maiden autonomous spin in July 2016 at a relatively empty
Maryland real estate development. It’s since been street-tested in Berlin,
Copenhagen, and other places. At the time the bus went on the market this
fall, Local had first-year international orders for 70 vehicles. Initial
buyers include Goodyear Tire & Rubber Co., the State University of New York
at Buffalo, the Australian city of Adelaide, and Denmark’s largest
automotive distributor, Semler Gruppen A/S.

Selling cars isn’t entirely the point, though. “A lot of companies make
cars,” says Rogers, a former serviceman who favors bow ties and a buzz cut.
“That’s not us. We want to turn the rules of manufacturing upside down.”

For such a mission-oriented company, Local has a haphazard origin story. In
1999, Rogers joined the U.S. Marine Corps, seeking to bring discipline to a
desultory career that had taken him from aerospace engineering to a Chinese
medical-equipment factory to investment banking. Even choosing to enlist was
a bit random; he’d been about to enter the MBA program at Stanford, but on
orientation day he struck up a conversation with a fellow student who’d been
a Marine. “Why would you go to business school?” the man asked when he heard
Rogers’s nomadic résumé. “You know business and banking. You need to learn
how to lead people.” Within months, Rogers was in the service, not quite
sure why or to what end. He stayed for two tours, including a deployment in

In April 2004 a platoon led by a buddy of his, Captain Brent Morel, was
ambushed by several dozen Sunni insurgents as they traveled in a
three-Humvee convoy through heavily contested Anbar province. Morel ordered
his team to leave their vehicles and counterattack. The enemy scattered, but
Morel was killed. “It didn’t have to happen,” Rogers says. “It was pure
stupidity to deploy Humvees in Iraq. Those vehicles are an exercise in
asinine design. They have a huge engine, so you can’t hear anything from the
inside, leaving you vulnerable. And to get out of them when you have your
full battle rattle on … imagine a clown car unloading five or six Marines
through a door hole the size of half a human, and you get the picture.”

A couple of years later, another friend, Major Joseph McCloud, drowned when
his Boeing Vertol CH-46 Sea Knight helicopter was forced to make an
emergency landing and flipped over upon hitting the water, a known risk for
the aircraft. The incident further convinced Rogers that companies simply
weren’t making smart enough products. “If Humvees and Sea Knights were the
best that American manufacturing could do, something was wrong,” he says.
(Boeing Co. declined to comment for this article. AM General LLC,
manufacturer of the Humvee, said that while it couldn’t comment on the
incident involving Rogers’s friend, the vehicle “has continued to evolve and
improve during the past 15 years.”)

After leaving the Marines, Rogers spent a year at Harvard Business School,
honing the model for the company he wanted to start. He founded Local in
2007. His elevator spiel was that it would build vehicles in low-volume
minifactories using the latest production technology, lightweight materials,
and manufacturing techniques. Each car would be made with a specific kind of
customer in mind, whether it would operate on the battlefield, the Baja
California peninsula, or the open road. This build-on-demand strategy, a
buzzed-about goal for many manufacturers, was intended to give Local the
essence of a craft shop—the best position, in Rogers’s mind, from which to
succeed. “Our conceit was that we were artisans at the gates of big
industry,” he says.

He was certain Silicon Valley venture capitalists would buy in, but he soon
found that the enormous investments flowing into early electric-vehicle
companies such as Tesla Inc. and Fisker Automotive had sapped enthusiasm for
other industrial ventures. With the big venture companies abstaining, Rogers
made do with shoestring funding from 45 individuals—family, friends,
acquaintances, mavericky tycoons such as aerospace billionaire Robert
Bass—who gave him a combined $10 million in seed capital. It wasn’t much,
about 1 percent of what Nissan Motor Co. had paid to build a relatively
small factory in Canton, Miss., a few years earlier.

The tiny bank account was a challenge, but for a company aspiring to
artisanship, it was at least apt. Local’s debut product was the Rally
Fighter, a souped-up, fiberglass-chassis dune buggy capable of hitting 130
mph on an open stretch of desert. Rogers couldn’t afford to design the
vehicle in-house, so he took the unique step of crowdsourcing its concept,
offering $20,000 for a winning idea. The top prize went to an art student
who patterned the vehicle after the P-51 Mustang, an iconic single-seat

When Local’s high-riding, menacing-looking sand crawler rolled out in 2009,
it became an instant obsession for gearheads, making appearances in the Fast
& Furious film and Grand Theft Auto video game franchises and on the TV
shows Jay Leno’s Garage [
] and Top Gear. To sidestep regulatory requirements for street-legal cars,
customers made Rally Fighters using a kit containing the parts and
powertrain components (with help from staffers at Local’s flagship factory
in Chandler, Ariz.). The company sold about 20 a year at prices that could
top $120,000, with options such as a custom camouflage wrap, bright orange
interiors, and wall-to-wall speakers.

The Rally Fighter bore out some pivotal assumptions of Rogers’s business
model. By blending low costs and malleable materials with premium pricing,
Local could, as he’d hoped, turn a profit relatively quickly. It took about
50 vehicles. But after peddling the Rally Fighter for a few years, he soured
on the build-your-own program, concluding that it was a distraction for a
company meant to reinvent manufacturing. He started phasing out the Rally
Fighter in 2013, disappointing a line of waiting buyers, and began looking
for a more useful product that would draw on new production technologies.

When small, affordable 3D printers hit the market in early 2014, Rogers
threw down a challenge to his employees: Make the world’s first drivable
3D-printed automobile, in full view of attendees at that September’s
International Manufacturing Technology Show in Chicago. He kicked things off
with a six-week crowdsourced design contest, asking participants to “imagine
if you could create the major elements of the exterior, the structure, and
the interior of a vehicle in one part.” More than 200 entries later, the
winner was the Strati (Italian for “layers”), a snub-nosed two-seater whose
sides flare up and back like Batman’s cowl.

The vehicle was conceived by Michele Anoe, an Italian designer who’d worked
for Fiat Automobiles SpA and Mercedes-Benz. It would, as Rogers had
specified, use additive manufacturing (another term for 3D printing, because
the process involves depositing strata of materials one after another),
drawing on a new generation of carbon-based polymers to produce a body and
chassis that weighed less than 500 pounds. Once the drivetrain, wheels, and
brakes were added, the finished vehicle would contain fewer than 40
components, compared with as many as 30,000 for a typical compact sedan.

Local’s team worked on the Strati for months at its new, bigger factory in
Knoxville, experimenting with materials and testing 3D printer limitations.
Even so, when the trade show rolled around, Rogers was anything but
confident. The Strati would be by far the largest 3D-printed item yet
attempted, and it was impossible to predict whether the more than 200
printed tiers of thermoplastic—a polymer that becomes liquid when heated and
solid when cooled—would fortify each other or cleave under their own weight.
It was also unclear whether the polymer would retain its strength after
being stretched into an intricate rounded form.

As the huge print heads whirred to life before a crowd of about 1,000
people, all Rogers could think was that he’d promised to take several city
officials for a ride when the Strati was done. “What if it comes apart and
leaves the mayor by the side of the road?” he remembers worrying. “That
would pretty much have been the end of our business.”

The printing and test ride went off without a hitch. Some 100,000 trade-show
attendees saw the Strati being made during its 48-hour construction process,
and it swiftly became the talk of the automotive and technology press. It
was only a concept car, capable of going about 45 mph at best, but it
suggested that Rogers had finally hit upon a way to manufacture a product
versatile enough to incorporate new technologies and materials and be
potentially profitable at low volume. Soon after the test drive, he began
pondering ideas for a vehicle Local could take to the global market.

Given his precarious early financing, Rogers might’ve had to tiptoe onto
this larger stage. But around the time the Strati project was getting under
way, Local had stumbled onto a new business. Its manufacturing exploits had
piqued the interest of some large industrial companies outside the auto
sector, which wanted to make their production methods more responsive to
customer preferences and less wedded to risky, high-volume products. In
February 2014, General Electric Co. became the first major manufacturer to
license Local’s model, establishing GE FirstBuild, a tiny unit designed to
pay for itself within a year, near Local’s Knoxville headquarters.

The aim was to use 3D printers to make products quickly and cheaply, in
limited volume, to gauge the market for them. If it looked as if an item
would be moderately popular—say, 300,000 units a year—FirstBuild would
manufacture it itself. If it really took off, GE Appliances would take over
using traditional high-volume manufacturing methods. The unit was “built for
speed, unlike other parts of GE,” says Chip Blankenship, who as head of GE
Appliances signed the deal with Local. (He’s now CEO of aviation company
Arconic Inc.) “We learned from Jay and the team that speed is becoming more
important than intellectual property. We had to figure out how to
manufacture fast.”

They also had to learn to tap into customer tastes. In the first year the
success of just two products, a $299 Bluetooth sous-vide cooker and a $550
nugget icemaker, more than covered the team’s production costs. FirstBuild
has been profitable ever since, adding crowd pleasers such as a $10,000
residential pizza oven and a $29.99 retractable washing machine shelf that
prevents clean clothes from falling on the floor as the barrel is being

The partnership brought in enough money that Local could afford to pursue
its global ambitions. A few months after the Strati’s debut, the company was
invited to participate in Berlin’s Urban Mobility Challenge, which was
intended to create an emissions-free, mass-transit shuttle for the city.
Rogers sent out a call to his network of designers—by now encompassing
almost 200,000 amateur artists, engineers, and graphics specialists, whom
Rogers collectively refers to as “co-creationists”—for blueprints to build
an 8- to 12-seat minibus. Edgar Sarmiento, a 24-year-old Colombian
industrial engineer, won the $20,000 top prize, plus residuals from future
sales, with a rendering that would become Olli. (Other entries included a
tantalizing, if not quite feasible, coterie of commuter copters, as well as
the Berlin Pill, a single-seat antigravity levitation pod resembling Spock’s
casket in Star Trek II: The Wrath of Khan.)

Olli was the fruition of Rogers’s vision for Local. In the rest of the
industrial arena, additive-manufacturing breakthroughs have tended to be
relatively minor, such as the first 3D-printed part in a production-series
automobile, a pocket-size metal roof bracket in BMW AG’s 2018 i8 roadster.
Olli’s entire chassis and body could be printed in less than a day, half the
time it would take to assemble its mass-produced counterparts. And unlike
the Strati and virtually all similarly manufactured items, it emerged from
the printer without striated layer lines, because Local’s machine can smooth
out materials as it extrudes the finished product.

Moreover, Olli’s low-volume, one-item-at-a-time process meant it could be
customized to passengers’ sizes, preferences, and physical limitations
without extending production schedules. Once the car was on the road,
updates and changes to the specifications could be made as often as needed,
eliminating the need for the billion-dollar-plus remodeling efforts commonly
undertaken every five years or so to freshen an aging vehicle line.

With these advantages on its side, Olli raced from design to road testing in
only nine months, for less than $6 million. Rogers likes to compare this
cost with BMW’s $2.6 billion investment in the ill-fated 8 series, which hit
showrooms in 1989 and was shelved a decade later after sales of only 30,000.

Olli also promised two technologies that weren’t part of Rogers’s original
vision: autonomous driving and artificial intelligence. The possible
benefits were too compatible with his early ideals to ignore. “This isn’t
just finding a way to get email through the car dashboard,” he says. “Olli
serves a higher purpose, improving people’s lives, which takes me back to
the catalyst for the company when I was in Iraq.”

Of course, self-driving and AI pose complex challenges that have made them
primarily the province of major automakers and tech giants. To keep pace,
Local forged research and development partnerships with International
Business Machines Corp.’s Watson program for artificial intelligence and
with Robotic Research LLC—which last year opened a breakthrough autonomous
transportation hub at North Carolina’s Fort Bragg to ferry wounded soldiers
from the barracks to doctors’ offices—for self-driving sensors and software.

The relationship with Robotic should maintain Local’s position at the
cutting edge of autonomous-vehicle capabilities. AI could be another story.
IBM’s artificial intelligence unit has largely sputtered, part of a larger
trend of underwhelming advances in that field. Local may be forced to manage
development in-house, as it’s done with materials.

Rogers has the advantage of customers willing to pay top dollar for Ollis
right now, whereas rival autonomous-vehicle programs are thus far for
internal use only. One of the first buyers was Goodyear, which is deploying
Olli to collect data about tire performance on self-driving electric
vehicles and to explore untried tire designs. The company hopes one day to
provide tires and light maintenance for Olli convoys cruising through
downtown areas of large cities. “We have to rethink our products faster than
the auto industry is changing,” says Chris Helsel, Goodyear’s chief
technology officer. “Olli is way ahead in the autonomous fleet segment,
which we believe could be a big business.”

Before that day arrives, Local will have to clear some significant hurdles.
Foremost is whether it can afford to wait until regulatory curbs on
autonomous vehicles are lifted. One thing in the company’s favor is that a
shuttle with a prescribed set of routes and somewhat predictable street
conditions is likely to gain approval before a passenger car. But by the
time that happens, Local could have heavy competition. In January 2018 at
CES, for example, Toyota Motor Corp. unveiled a concept vehicle called
E-Palette that looks strikingly like Olli and promises parallel

Rogers believes Local’s manufacturing model gives it an edge. Because it can
customize vehicles and add elements almost as easily as, say, Apple Inc.
updates iOS, he thinks it will be able to offer new features faster and keep
his profit margin high. “By the time Toyota comes out with their Olli, we
will be up to version 10,” Rogers says. “My bet is, behind closed doors at
Toyota, they will lose their minds, because every time they make something
new for their concept car, Olli will have it on the road already.”

While established automakers privately offer grudging respect for Local,
none has attempted to adopt its ideas. Ironically, part of the reason it
would be difficult for them to do so is that their assembly methods are
designed around lean manufacturing, a concept built upon continual plant
improvements to boost the returns from high-volume production. Such changes
make big systems more efficient, but they aren’t particularly helpful for
small runs and customized markets. “A lot has changed in auto plants,” says
John Bozella, CEO of Global Automakers, an industry trade group in
Washington, D.C. “But it is still a very-long-lead-time industry that sells
products in high volume, and the overall manufacturing approach remains as
it has been. Local Motors is a much more transformative idea. It’s like
starting over again.”

For now, Local will continue filling its war chest with manufacturing
licensing agreements like the one with GE. It now counts Siemens AG, Airbus
SE, and the U.S. Marines as clients, and, unlike with the FirstBuild deal,
Local is typically specified as the manufacturer for any product that
emerges from its design community. The demand for these partnerships has
been so steady that Rogers recently spun off his co-creation unit into a
sister business called Launch Forth.

Its collaborations often take partner companies far afield from their normal
activities, letting them conduct experiments they might otherwise be too
timid to get behind. Earlier this year the insurance giant Allianz SE
solicited concepts to replace the wheelchair with a mobility device that can
be adapted for purposes beyond going from point A to point B. The winner,
the Segway-like 3T, can be operated by a joystick or directional body
movements. It has a high standing seat made of foam pads that conform to a
user’s shape, and the wheels can be swapped out for tank-style tracks for
trail or off-road activities, or even for skis.

Rogers says he’s gratified by Local’s progress, but he eagerly awaits the
moment when its reputation expands beyond gearhead and industry circles and
enters the discussion about the future of transportation. That day is
coming, he’s convinced. For now it would be enough, he says, if he could
stop “having to convince people that there’s a future beyond Henry Ford.”
[© bloomberg.com]
Rally Fighter dune buggy

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