Design This Day | Episode 9

Will the maritime industry ever ditch fossil fuels?

Kofi Asante joins Teague Futurist Devin Liddell to talk about electric tugboats, the challenges of electrifying maritime transportation, and what it takes to bring new technology into a legacy industry. Kofi is the VP of Business Development and Expansion at Arc. He previously worked in autonomy across the trucking and aerospace industries.

Kofi Asante:
I didn't grow up with tugboats. I didn't even grow up with a maritime background, and so I had a lot of humility in it. We're just asking a bunch of silly questions from industry leaders in this space over and over again, and then also taking notes on why anyone would think that it wouldn't work.

Devin Liddell:
Welcome to Design This Day, a podcast about the future, the futures we want, and the people working right now to make those futures real. I'm your host Devin Liddell. I'm a futurist at Teague. I spend a lot of my time thinking about the gap between present challenges and future solutions. Today I'm speaking with Kofi Asante, VP of business Development and Expansion at Arc. Kofi previously worked in autonomy in the trucking and aerospace sectors. Now he's turning his sights on a new frontier, our waterways. He and the Arc team are building electric boats and aim to revolutionize the entire maritime industry.

Electrifying the maritime industry from pleasure craft and fishing vessels, to cargo and cruise ships is a massive undertaking. Arc started on the consumer side, creating an electric wakeboat for the water sporting world. High torque and a quiet engine was an obvious win for that group, but breaking into the commercial maritime industry poses an even tougher challenge. Here, vessels need to run around the clock and deliver rock solid reliability. To prove that they could be done, Kofi and his team are electrifying the hardest working boats in the harbor, tugboats.

Kofi Asante:
I mean, they're rugged, they're strong, they're powerful. They're the cornerstone of our economy. We literally cannot get cargo ships in and out of the port. You can't dock them or have them leave without having a tugboat connected, which a very high percentage of our supply chain and our economy, trillions of dollars go through that process. And so it's an inelastic piece of something that a lot of people probably don't think as much about as we might spend our time doing, but that's why we get excited about them.

Devin Liddell:
The team would need a working prototype. They decided to retrofit an existing tugboat instead of building one from scratch. They picked a compact 26 foot vessel, what operators call a truckable tug. It's a small but powerful vessel that is expected to handle some seriously heavy loads.

Kofi Asante:
And that tug actually was already operating as a diesel tug. We're basically giving it a heart transplant, taking out the diesel engines and then putting in some of our batteries. And so starting with a truckable tug allows us to get something in the water very, very quickly.

Devin Liddell:
Next, Kofi's team had to win over the people who would actually be using these futuristic tugboats. Without buy-in from at least one tugboat operator, the effort risked stalling out. This is an industry that has largely done things the same way for decades. Kofi said that the whole project, the whole push to electrifying commercial shipping hinged on at least one operator taking a leap of faith.

Kofi Asante:
That was honestly probably the most critical part. We can't do this without the operators buy-in and them saying they want to use it, they want to buy it and put it to work. And so we started with finding who the early adopters were going to be because I think a lot of the market, they could easily fast-follow, right? They could see it working. They see the business case and be like, "Yep, I'll take that. I'll do that." But early adopters are typically a much smaller percentage.

What I ended up doing was doing as much research as possible before going to talk to operators. I had to understand all the bases. I didn't grow up with tugboats. I didn't even grow up with a maritime background. I was in aerospace and focused on autonomous trucks before, and so I had a lot of humility in that. We're just asking a bunch of silly questions from industry leaders in this space over and over again, and then also taking notes on why anyone would think that it wouldn't work. So it's easy to kind of only hang out with people who are in an echo chamber telling you why it will work, but me and my team, we spent the bulk of our time trying to take notes on what are the obstacles, what are the challenges? Why would there be hesitancy to this? Why has that not happened before?

My job isn't to persuade the operators to do anything in particular... It's more so to listen to their pain points, active listen, and then provide solutions so they think could be effective.

Devin Liddell:
Kofi may not have trained as a designer, but he's tackling the challenge the same way we do at Teague. We start by listening to the people who will live with the results and design with their needs in mind. At this early stage, that kind of user insight can be the compass that points the whole project in the right direction.

Kofi Asante:
I've been fortunate to talk to a lot of really brilliant tugboat captains. I mean, they've been phenomenal and they share so willingly, and a lot of them are actually very, very innovative by the way. So some of the ideas that I have are not my own. I'm taking them from the industry and listening, listening to operators who've been doing this for decades. My job isn't to persuade the operators to do anything in particular, especially for the early adopters. It's more so to listen to their pain points, active listen, and then provide solutions so they think could be effective.

Devin Liddell:
And you mentioned some of them mentioning the reasons that wouldn't work. What were the big ones?

Kofi Asante:
The two big ones were infrastructure and cost.

Devin Liddell:
Interesting, okay.

Kofi Asante:
And they were so fair and such good points that we actually ended up taking on a lot of ownership over infrastructure so we can say, "Hey, you don't have to worry about it. We're going to figure it out. We're going to take care of it." A lot of our team were responsible for the infrastructure at Rivian and Tesla, so they're like, that's actually something that they had to think about in automotive, we're going to apply similar techniques over. And then the cost itself.

And so our ability to be able to basically develop battery packs in-house allows us to drastically reduce the cost of one of the largest factors, which is the battery, right? These batteries could sometimes take up the space of two rooms and maybe even two floors. They could be massive when you get to the larger ships. And then for smaller ships, because we'd already had to do this for the consumer side, we'd had to be honest with what our costs were. We buy in bulk. We have other markets that we're able to support, so we get a lot of those benefits. And so those were the two. We were able to drive down the cost for electric propulsion pretty substantially, and then we also are able to provide infrastructure.

Devin Liddell:
Cost and infrastructure are familiar hurdles for anyone trying to innovate in the legacy industry. Kofi leaned on his experience disrupting the trucking and aerospace sectors to inform his approach. He hired people with deep expertise in charging infrastructure and tapped into Arc's existing battery supply chain, which was already supporting their high-performance recreational boats. Taking the operator's concerns seriously and addressing them head on made all the difference. With buy-in from an early adopter, the electric tugboat project was a go.
When it comes to the operators themselves, what are they the most excited about when it comes to an electrified tug?

Kofi Asante:
I'd say the top two to three things that we hear, one is reduced maintenance.

Devin Liddell:
Okay.

Kofi Asante:
There's always a running joke for a boat, you'd rather have a friend that has the boat. That's not the case for electric.

Devin Liddell:
I always heard the saying was that the two best days of owner's life is the day they buy the boat and the day they sell the boat.

Kofi Asante:
Exactly, exactly.

Devin Liddell:
And it's because of maintenance. Yeah.

Kofi Asante:
Yeah. It all shifts because of maintenance. The other one is reduced fuel cost. I mean, that's a big cost for operators. And whether you care about the climate or not, you probably don't want to spend a lot of money on fuel, so it ends up being a net positive for operators. We did make the dash look pretty cool. It looks like something out of a Tesla, and that's just not traditionally the way it used to look. But our team has given all the same bells and whistles that you would probably see on our consumer product are now going to be a part of this industrial application.

The other one is reduced fuel cost. I mean, that's a big cost for operators. And whether you care about the climate or not, you probably don't want to spend a lot of money on fuel, so it ends up being a net positive for operators.

Devin Liddell:
You mentioned the display. From an interaction model standpoint, does that change the proposition at all in terms of who could potentially operate a vehicle?

Kofi Asante:
For commercial, you have a lot of captains who grew up in this and they know it really well. They're incredibly talented at driving tugboats, whether they're complex or simple, and I think we can make that easier for them, but a lot of them are already really great at it. But at the core of what we're building is just a better, smarter, high-performing boat. You have over-the-air software updates the same way your phone does, your computer does, your Tesla does, all of it. And so it just gets smarter over time and it's kind of a better experience.

You can have maps on there that are very visible and easy for everyone to be able to manage. You could even tell your boat to drive a certain way. Your boat can remember the way you like to drive. You could down the road auto-dock, auto-trailer. You could even have the boat just autopilot and drive itself. There's just a never-ending amount of solutions that are out there for software, and we can just push those updates over a course of 30 seconds or a minute. We can just push those updates whenever we need to. Yeah.

Devin Liddell:
I mean it obviously prompts a question as to the future of autonomy and for these applications. I imagine actually maybe really enough, and maybe this is a contrarian take, is autonomy easier to sort out when it comes to tug and commercial operations than it is for consumer applications?

At the core of what we're building is just a better, smarter, high-performing boat. You have over-the-air software updates the same way your phone does, your computer does, your Tesla does, all of it. And so it just gets smarter over time.

Kofi Asante:
That's a good question. There's sensitivities around autonomy in the tug and commercial market that are not purely technical, and I think some of that is about the protection of the captains that we were just mentioning and the jobs, the union labor rules, and also generally the complexity of what is required in that space to do. And so it's not something that we've been asked by operators. We tend to try and listen to customers and demand, and we haven't really been asked to do much around autonomy.

I'd say if you're thinking about what industries are going to adopt autonomy in maritime, it's probably going to be military first. Then some of those features might roll into recreation, and then there is some opportunity for commercial. But I think the military use case for places that are unsafe for people to be able to drive and you want to keep your troops as safe as possible, I think that's going to be one of the biggest use cases for autonomy in maritime.

Devin Liddell:
Got it. Interesting. We worked on a project years and years ago around the prospect of autonomous school buses, and one of the things we found out when we were working on it is that actually nationwide, there's a shortage of school bus drivers. And it makes sense when you breathe it in, it's like, well, yeah, actually you have to have a Class C license. You only get to work in the mornings and afternoons. It takes a certain person to want to do that, in some regards. Do you want to haul around heads of lettuce or do you want to haul around screaming kids? A lot of people say, "Lettuce, please." But when it comes to tugboat operators, is there a shortage of tugboat captains, for example?

Kofi Asante:
Yeah. I mean, it's a pretty specialized market. And then a lot of the people who are in it, it was generationally passed down. But yeah, I would say there's a shortage there, and I think those end up being great applications because you do need to fill that gap in and I think it's a net positive for everyone. And then autonomy tends to run to the spaces that are the most dangerous or monotonous, or the ones that people typically don't want to do. That's where you end up finding a lot of the adoption the quickest.

Devin Liddell:
Autonomous tugboats may be a distant possibility, but right now the real challenge is going electric. And like Kofi mentioned earlier in our conversation, the lack of existing charging infrastructure was a major sticking point with tugboat operators. Tugboats are usually assigned to a specific area, say a particular harbor like the LA port, but while tugboat captains may not get range anxiety the same way early adopters of electric cars might have, they do have very demanding uptime requirements. Kofi's team had to find a way to charge the tugboat batteries extremely quickly so that electric tugboats don't take much longer than their diesel counterparts to top up.

Kofi Asante:
For tugboats, they're operating on a almost like, seven day basis. They're operating all the time, and so if they need to charge, you can charge them in less than an hour, less than 45 minutes with a rapid charger. If you have more time, then you can actually just do it overnight.

Devin Liddell:
Yeah, that's one of those things that may not be apparent to a lot of casual observers is that tugboats, they are hardworking. They're working long shifts, they're working around the clock if they can. I mean, that's what they're doing. They're always out there.

But building electric charging stations isn't just about developing the tech. It's about fitting that tech into a system that was never designed for it. Tugboat captains may be used to pulling up to traditional fueling docks, but those sites weren't built with electrification in mind, often lacking the physical features needed to support high-powered marine charging.

Kofi's team found solutions by taking a pragmatic approach.

Kofi Asante:
One of the harder aspects of this is actually having to work within the bounds of what already exists. And so utilities naturally have already a long-standing of thinking about the projections of how much power is going to go into a place. They're planning out years and years ahead. With a disruptive technology like this and the timelines of a startup, you're trying to make significant progress in a fraction of the time of what they're used to having to deal with.

One of the harder aspects of this is actually having to work within the bounds of what already exists... With a disruptive technology like this and the timelines of a startup, you're trying to make significant progress in a fraction of the time.

And so collaborating with utilities is big, working within places that are very flexible. For an example, we're at AltaSea, they're a phenomenal partner because they actually already have land and space at the LA port, and so working with groups who are saying, "Yes, we'd be happy for you to put your equipment here, and we want to support that type of activity."

And then not reinventing the wheel. There are things that might be difficult to do, but they don't need to be harder because you say that you have to provide only your solution. There's things that we can take off the shelf that exist and apply them that automotive and aerospace have already invested a lot of resources into, and then we just apply that to maritime. And then obviously we'll make it safe. We'll make sure that it hits all the certification standards, but we try and be pragmatic and then also exercise a lot of humility here around what's a better solution that we have to do versus things that we can actually just get off the shelf.

Devin Liddell:
With the infrastructure being built as we speak, there may come a time sooner than we think when every ship using the Port of Los Angeles runs on electricity. The maritime industry has been slower than others to embrace electrification, but Kofi believes it's on the cusp of change. And like electric cars, the upsides go well beyond reducing emissions. Lower fuel costs, streamlined maintenance, and other operational advantages could make electrification not just viable but essential. One day, tugboats cargo ships, and cruise liners may all be electric. That shift could transform daily life, not just for the people who operate them, but also for the human communities and aquatic life that make their home around the port.

Kofi Asante:
I mean, I think it is one of those rare moments where you're like, this might be a once-in-a-generation opportunity to be at the forefront of pushing this. I think about a lot of my friends who are at Tesla at the beginning, and that's kind of like a one-time opportunity. Same with Uber when we were building it. And so I was like, I think this might be one of those, so let me see if it works. Yeah.

Devin Liddell:
There will be a time I'm convinced that we'll look back. You'll see a muscle car or you'll see an old-school ski boat with diesel engines and it will be like, anachronistic. You're like, "What the hell is that?"

Kofi Asante:
Yeah, it'll be like a throwback a little bit, right?

Devin Liddell:
Right, exactly.

Kofi Asante:
That's retro. Yeah, exactly. That's what's crazy about the port too. When you do these business-to-business types of deals, you're working with a group that can order in bulk. They have a high concentration in a certain area, and so you can almost create these futuristic environments that exist all in themselves. So there will be a day, probably not too far in the future, maybe the next two to three years, where you go to an LA and Long Beach port and everything is electric.

Devin Liddell:
If you've ever been up in Seattle, I live up in West Seattle, which is adjacent to the port, so the port's kind of pretty close to where I live, so much so that I can hear it, and that's where I'm going with it, is I can hear the port, I can hear some banging, I can hear things being dropped, I can hear and I hear when the ships come in and so forth. A lot of the noises I actually kind of like. I actually really like the sound of the foghorns and so forth, but I also wonder if that will be a way that we measure some progress that we just don't quite grasp at the moment, which is the sonic signatures of ports. I wonder if there'll be a moment when we start to register the acoustic footprints of ports and be like, wow, Los Angeles is so quiet. It is a quiet efficiency compared to like, oh, this other port's just, it is noisy.

Kofi Asante:
Yeah, exactly. And I'd say in other industries like trucking and aerospace, that was a really, really big deal. You'd be surprised the amount of conversations that are not just about the safety or the technical feasibility of a flying car or a flying vehicle, like a vertical takeoff and landing. It's actually the noise. They're like, we don't want the equivalent of a helicopter in our backyard. And so that was a huge thing.
There's so many additional opportunities that are unlocked from electric. We talked about lower maintenance, almost no maintenance on the boats, no fuel, no fumes, the high torque. But then the fact that it is quiet allows you to be in a lot of spaces that you might not have traditionally been allowed to be in. There's rules and regulations that kind of cap the speed that you're able to go at for traditional ships that are burning just a ton and ton of fuel just to make sure that you're not overly polluting the world. You could actually theoretically speed up transportation on a pretty global basis if you were able to not have to have that restriction.

There's so many additional opportunities that are unlocked from electric. We talked about lower maintenance, almost no maintenance on the boats, no fuel, no fumes, the high torque. But then the fact that it is quiet allows you to be in a lot of spaces that you might not have traditionally been allowed to be in.

And then also reduce the cost. I mean, it's over like 80% of supply chain is on maritime shipping right now. And so if you can take out one of the largest factors, which is the operating cost and maintenance in the fuel, and allow it to go faster, then you just have faster shipments that are cheaper all around the world.

Devin Liddell:
All right, I want to make sure we get our lightning round in here. So what's your take on the most underhyped technology?

Kofi Asante:
Underhyped, I'd probably have to say autonomy, but I'm thinking about industrial applications like construction, like mining. Those are likely going to be spaces that have a pretty big amount of adoption.

Devin Liddell:
So this is like autonomous bulldozers, lifters, that kind of stuff.

Kofi Asante:
All of it. Yep. Cranes, all of it.

Devin Liddell:
That's a great answer. What's an innovation in another industry that has inspired you to think differently about the work you're doing at Arc at the moment?

Kofi Asante:
This is my third industry, so trucking, like autonomous trucking, and then autonomous hybrid electric vehicles, vertical takeoff and landing, all of them played such a big factor, like a big role in the way that I'm able to now think about this new space. So you start to understand the timelines that just exist for hardware. There aren't many shortcuts if you want to do it safe, you want to have it be high quality. And so that was really helpful. And then that model that we were talking about around early adopters and fast followers, a lot of that is the same across all three of those industries.

Devin Liddell:
Yeah, interesting. All right, so what about a book or a show that you are either currently reading or you're watching or you finished watching or reading that has influenced the way you think about your role as an innovator?

Kofi Asante:
I have an unconventional answer on this one.

Devin Liddell:
Oh, I love it.

Kofi Asante:
Yeah. Honestly, I love basketball, and so watching the NBA is the thing that helps me just refresh. When I pull on that thread of what is the thing that maybe inspires you or allows you to think about things differently, sometimes for me, especially if you're so stimulated through the day with the work that you're doing, being able to refresh with something that you really look forward to or at least gets your mind off, everything allows me to recharge so then I can come up with some of the better solutions. Yeah.

Devin Liddell:
That's fascinating. It actually makes you realize that we probably underestimate improvisation as a form of innovation, because sometimes you see a soccer player or a basketball player do a move and you're like, "There wasn't a plan for that. That was born of beautiful improvisation." And the only reason I bring it up is I think sometimes maybe we underestimate the value of improvisation when it comes to innovation.

Kofi Asante:
100%.

Devin Liddell:
That's it for today. Thank you for listening to Design This Day, a podcast by Teague. Subscribe on your favorite podcast app so you don't miss the next episode. And if you have a complex problem that needs solving, we'd love to hear from you. Visit us at teague.com or send us an email at hello@teague.com.