CNBC Marathon explores how Tesla, Rivian and Dodge’s new electric vehicles are transforming the automotive industry.

Over the past decade, Dodge has dug deep into its performance car heritage and become a brand known for brash American muscle cars with supercharged V-8 engines and ridiculous amounts of horsepower. But tightening regulations, rising fuel prices and the rise of the SUV are putting the squeeze on Dodge's so-called “brotherhood of muscle.” It recently debuted the Charger Daytona SRT EV, an electric car that looks a lot like its popular supercharged Challenger and Charger. Will Dodge fans or EV buyers want it?

Five years after Elon Musk first announced the Tesla Semi, it’s finally hitting roads. CNBC visited Pepsi’s Frito-Lay facility in Modesto, California, where it is using the new electric trucks, to see whether the Semis live up to the hype.

A new electric vehicle company hopes to take on Tesla with its outdoor adventure trucks and SUVs. And its deal with Amazon to build 100,000 electric delivery vans could help it succeed. Founded in 2009, Rivian is focusing on upscale electric trucks and SUVs with an emphasis on outdoor adventure. CNBC's John Rosevear calls them the "Patagonia of electric vehicles." Last month, Rivian and Amazon rolled out the first of the electric vans. They are starting to deliver packages in a handful of cities, including Seattle, Baltimore, Chicago and Phoenix.

After manufacturing's 40-year cycle of decline in the U.S., officials in Washington are trying to bring it back. This move could be a boom or bust for huge swaths of the American Midwest. This region once dominated the auto industry before rising global trade and automation sent domestic manufacturing employment into a tailspin. U.S. leaders hope that new laws such as the Inflation Reduction Act of 2022 will help businesses create the green manufacturing jobs of the future.

Chapters: 
00:00 — Introduction
00:48 — Will Dodge’s Electric Muscle Car Satisfy Its Die-Hard Fans? (Published October 2022)
15:31 — Does The Tesla Semi Live Up To The Hype? (Published February 2023) 
31:33 — How Amazon Is Giving Rivian An Edge In The EV Industry (Published August 2022)
44:50 — How Electric Vehicles Will Change The Midwest Economy (Published September 2022)

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How Car Makers Are Switching To EVs | CNBC Marathon

Our transition to electrification is really critical.

Tightening emissions regulations and a shift toward SUVs are making it hard to keep producing gas guzzling sports cars.

The need for alternatives to diesel is steadily rising as stricter emission regulations are established.

Some of the very first Tesla semis are hitting the roads.

Following in Tesla's footsteps, there's another electric vehicle company that's been making a name for itself.

Rivian unveiling a new $5 billion battery and assembly plant.

Whether the companies want to admit it or the states want to admit it, they are battling for investments in automotive like they've never had to do before.

I've told everybody throughout my entire life, if you see me driving an electric car, shoot me in the head.

Put it right behind my ear, angle it up a little bit, and pull the trigger so you get a good shot at it, right?

He is 1 of what is sometimes called the Mopar faithful, people who are deeply devoted to all things Chrysler.

Dodge, which is 1 of 14 brands owned by Euro-American giant Stellantis, makes the biggest, most fuel-thirsty American muscle cars you can buy.

But it is replacing its Challenger and Charger models with at least 1 all-electric vehicle.

Hope is to retain the magic of its muscle cars in an EV form.

At first glance, the company could risk losing some diehard fans like Meehan, But even some of them may be coming around.

I read this article the other day and man, I really like that car.

While they are a small share of total sales for Stellantis, leaning into American muscle and performance has brought Dodge success and many diehard fans.

But tightening emissions regulations and a shift toward SUVs are making it hard to keep producing gas guzzling sports cars.

I mean, this is like really walking a tightrope for us.

This car, I want to keep it exactly like it is.

I mean, I don't want to change 1 thing about this car.

Like my Hemi Cuda, that's a clone car, and I put that together so I wouldn't wreck the good cars, because I like to get on the cars.

I like to drive them, ride them, have fun with them, do some burnouts, that kind of thing.

In his airplane hangar outside Minneapolis, Minnesota, Alan Meehan has several Dodges and some classic Plymouths.

Not too far away, Greg Nelson is another Mopar believer.

He buys, fixes, stores and sells classic cars, mostly Plymouths and Dodges.

Because the guy before me didn't drive it.

I said you wrecked it now and I can't drive it.

But I knew it was 1 of 20 and I had to have it.

I built this to have a hang on for my stuff.

And then of course other people wanted to have their car fixed here or find them a car.

This is 1 of 3 or 4 black Challenger convertibles with a red interior.

And, you know, it's probably $125,000 car today.

A million 5 would buy it, I guess, but it's the only 1.

For collectors and enthusiasts like Meehan and Nelson, Mopars are just different from everything else.

Including rivals made by Ford and General Motors.

They made some of the most daring cars of the muscle car era.

It is the dust trail from the Roadrunner.

And so look at today It's the same thing.

They've been the leader in the crazy cars and colors.

When I think of Dodge, I think of power, and I think of styling.

Dodge made all kinds of cars over the decades, pickup trucks, minivans, and full-size sedans.

Trucks sold today under the Ram Trucks brand were originally branded as the Dodge Ram.

Dodge revived the Charger name in 2006 and the Challenger in 2008.

Meehan has an SRT8 Challenger from that first model year.

We just drove it up in northern Minnesota.

It dug deeper into that brand identity shortly after Chrysler emerged from bankruptcy in the financial crisis.

About a decade ago, we decided that we were going to distill the brand down to its performance essence.

And the brand is all about American muscle and performance.

Then in 2015, it debuted the Hellcat Challenger.

These cars are second to none for engineering.

A version called the Hellcat Redeye kicked that up to 797 horsepower.

The Redeyes, thank God you floor that thing and in 2 seconds you're going

But the most powerful of the bunch was the Dodge Demon, a very limited version of the Challenger that came with 840 horsepower.

The Demon was for a time the quickest production car in the world.

It could go 0 to 60 in 2.3 seconds and run the quarter mile in 9.65 seconds.

And this is a street car you could buy and you got a warranty and everything.

A list of things you have to sign an initial when you buy the car to make sure you know what you're getting, it's really something.

The only car in the world to do a wheelie, right?

The Demon was a limited run vehicle, but the Hellcat surpassed Dodges sales expectations.

By the time the car goes out of production, Dodge expects to sell 80,000 of them.

IHS Market released a survey of customer loyalty to various manufacturers and makes.

Mopar vehicles took top honors in several categories.

Among them was the Dodge Challenger in the sports car category, even though the Challenger is built on a full size sedan platform and is much larger than most other sports cars.

Power's appeal survey, which measures the emotional connection consumers have with cars and brands.

While Dodge has become known for supercharged V8 engines, environmental laws are proving them pricey.

What we said very early on was we have 2 choices.

We can either say, look, we can't make this transition because we see where the industry is going.

We can shut down the brand or we could look at it and say, is there something that we can do here to really have the same playbook that we created about a decade ago?

The challenge is that the auto market, EV or otherwise, has shifted away from traditional sedans and sport cars and toward crossovers and sport utility vehicles.

As for Dodge, the company has long sold the Durango and recently debuted the Hornet small SUV.

But it's muscle cars and sports cars are its identity.

We've really built this brand on the backs of some of those extreme performance vehicles.

Hellcats, red eyes, demons, the scat packs really is our biggest seller.

All of them are very aggressive performance vehicles.

Muscle cars not supposed to look like a melted jelly bean.

It's supposed to look like a big, blocky American performance vehicle.

There are other obstacles to electrifying Dodge.

Fans adore the unmistakable rumble of a V8 engine.

To get consumers involved and excited, you really need to connect to that emotional level.

And it goes beyond the fact that Tesla or Lucid or fill in the blank can go 0 to 60 in 2 seconds.

Dodge built the Charger EV with this driving experience in mind.

The vehicle has a shiftable transmission and a simulated engine note Dodge has said will be above 100 decibels.

Both of these innovations are controversial.

I have heard some pushback from some folks who say that it's akin to the turn of the century in the 1900s when cars had fake horse heads attached to the front of it so folks could more easily switch away from horse-driven carriages and it wouldn't spook horses.

Certainly some people are saying, oh that's fake noise And how can that be real and how can that be useful?

I mean, Dodge has said that it's real noise.

It's air going through baffles and it's not a piped in MP3 file that's pushed into your computer.

To be fair, a lot of cars already come with manipulated sound, even fuel burning ones.

An electric motor makes a very high, whiny, pitchy noise.

And the challenge that Dodge is trying to work through is that sound is definitely a part of that experience.

While other EVs are focused on keeping quiet, we amplified ours.

It's a part of a visceral sports car experience.

And so what does that look like in the future?

But what I heard was, well, that's interesting.

The shiftable transmission is a slightly different issue.

Transmissions are needed to manage the power from a gas burning engine.

Electric vehicles work differently, so multiple gears aren't needed.

The vast majority of EVs have only 1 gear, including high performance ones like Tesla's.

The Porsche Taycan has a 2 speed transmission and Formula E race cars have multiple gears.

I think a step in the right direction for them is it's got to shift.

I don't want to just get in the car and push down on the accelerator and have the power be linear.

I want to be able to shift it and have some fun with it.

I'm really excited that engineers are looking at these solutions.

I think that that's something that we haven't been looking at as closely in general as the industry because The transition to electric vehicles is so complicated and there's so many things to deal with.

A vehicle inspired by the SRT Charger EV concept will enter production in 2024, the year after production of the current Challenger and Charger Ns.

I'm not going to say I didn't get my fair share of hate mail from some enthusiasts.

And we looked at what the negative sentiment was out in our customer base on this transition.

We knew that our customer base, 13 million strong, are going to need soak time.

They're going to need time to make this transition in their mind to electrification.

We didn't want them to change, but they did.

And we can try to outrun them, but that would be a 9 second pass straight into extinction.

Dodge launched a 2 year business plan with scheduled quarterly updates to keep customers informed.

That includes the Speed Week event in August 2022, where it unveiled both the Hornet and the Charger EV.

There were about 20 million people watching the 3 day event, tracking social media posts and mentions.

Dodge found negative sentiment about the Charger EV was initially high, but it dropped over the course of 3 days, eventually settling below 50 percent.

Trust me, this is not the EV that they want you to have.

What was interesting to me was not the fact that we were over 50 percent positive.

It was the fact that it got better and better and better each day as they learn more and more and more.

Nelson and Meehan are at least open to trying out the new car.

I think it's a cool looking car and I want 1 because I want to have the first, you know, 1 of the first ones.

You got to drive and test it out and see if you like it.

But I guess if electricity stays super cheap, then maybe I'd drive 1.

Some analysts wonder if Dodge wouldn't be better off trying to attract a new audience of core EV buyers.

This brand in Stellantis' stable is the most exposed to the millennial audience, and millennials are the customer segment that wants EVs the most.

And so this is an opportunity to make a true EV, kind of what the Ford Mach-E did.

You know, that's more EV than it is a Mustang.

And it's done exceptionally well and targeted a new audience.

Of total Stellantis vehicles sold, RBC estimates Ram makes up 10 percent and Jeep makes up 19 percent.

Stellantis is kind of late to the game, especially compared to probably its most often compared peers, Volkswagen and Renault.

And so it's going to be a really expensive undertaking to electrify.

While EVs get more expensive near-term, Stellantis has to support all these disparate brands.

There really isn't a cohesive strategy of why you need all of these brands.

In the meantime, fans of what might be the last era of the V8-powered performance car are making their peace with its end.

They're gonna discontinue the gas-powered V8 engines is the way I understand it.

And being a Mopar and a Hemi guy, I'm sad to see that.

I still think these will be more fun than electric car, but that's what they're going to build, I guess.

It's always better to have things greener and better, but you gotta be practical about it.

Even at 10 bucks a gallon, I'm still gonna buy gas.

Oh, I'm crazy, I guess, about cars somewhat, but I'm not crazy.

In Modesto, California, some of the very first Tesla semis are hitting the roads.

The Tesla that you can see behind us is fully operational.

They're running up and down the road within a 400 mile radius delivering product to all of our distribution locations and to our customers.

We use them the same way you would see any traditional class 8 vehicle delivering product.

PepsiCo, which owns Cheetos, Doritos and other Frito-Lay products, pre-ordered 100 back in 2017.

Walmart and FedEx have also placed preorders, but Pepsi was the first customer to take delivery of the new truck.

PepsiCo owns 1 of the largest private fleets in North America, and that's 1 of the reasons we have partnered with Tesla.

We have the 15 in Modesto that we're launching and then we have 21 in Sacramento.

And then we are working plans for the additional units up to the

First announced in 2017, the Semi has been 1 of the longest delayed products in Tesla's history.

What makes the Tesla Semi so different and really Elon Musk's introduction of it is he really brought the awareness to the broader public.

And it could also be its vehicle with the biggest impact.

Even though trucks are only a small portion of all the vehicles operating on California's roads.

They are responsible for the vast majority of carcinogenic diesel particulate matter.

It loads only 1 percent of vehicle production.

It's 20 percent of vehicle emissions And it's over a third of all the particulate emissions.

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How Car Makers Are Switching To EVs | CNBC Marathon