♪ >> from our studios in new york city, this is charlie rose. charlie: the sole vice presidential debate took place last night. with only 33 days until the election, governor mike pence and senator tim kaine argued their candidates' positions. the consensus was governor pence performed better but failed to defend donald trump. the second of three presidential debates will be this sunday at 9:00. joining me now, the author of "audacity."

how barack obama to fight his critics and transformed america. here in new york, dan has served as an advisor to mitt romney and speaker paul ryan. i am pleased to have them all on the program. let me begin in new york, last night, what did that debate tell us about those two men, the republican and democratic party, and hillary clinton? >> on the republican side, just about every republican i know said it was a reminder if you have a normal, professional republican politician on the stage prosecuting conservative arguments, who knows what he is talking about, calm and understated, we would be winning the election. most of the arguments he made on a range of issues, are not donald trump's positions. he is disconnected from what is going on at the top of the ticket. it did remind you how we so lowered standards with this

nominee, with trunk. when you actually have someone normal up there, whether you agree with him, he can actually win the argument. last night, i don't think it has much of a difference on the outcome of the election. but i do think in the near term, pence won. >> my fellow analysts have opposite views. one person said, pence was the clear loser because the easy videotape refutes. one-way mike pence scored he has , given donald trump something we would like in life. a second chance. because he had a little bit of a momentum shift, the trump pence ticket got off the mat a little bit. so the chance for this debate on sunday, the town hall debate at washington university in st. louis it has given a chance for , donald trump to maybe learn a thing or two from pence.

dan was talking about what his republicans are saying. the other thing i know republicans have been saying today, because i have been hearing it so much, we wish pence were doing the debate prep for trump. we wish trump would see some of what worked and take it as his own. >> can i respond to that point? i have seen a lot of conservatives excited that pence was prosecuting the case against obama. he did win in a sense because tim kaine was not defending obama, he was defending clinton. prosecuting the case against trump. the fact is, barack obama is a pretty popular president. there is a defense that is persuasive to most americans who elected him twice and still approve of him. it is just not what tim kaine was there to do. charlie: the perception is, by a number of people other than dan senor, the cnn poll and other

places, focus groups, that pence did better than tim kaine. who it benefits is another question. you don't share that view? >> i think they are right, as a performer, he is a trained talk show host and he has a nice baritone. he spoke more slowly. he is more of a smooth television performer. off moree pulled that effectively. kaine wasn't really rebutting a lot of the arguments because he was there to make different points. charlie: on a moment of performance, is it bad debate tactics to interrupt too much? >> i thought kaine was surprisingly bad last night for the following reason. he tried to do what pence did to paul ryan in 2012. constant interruptions. biden used the word malarkey.

constantly laughing. i think kaine can't pull it off. but biden can pull it off graciously. he does it and he's still that level -- lovable uncle who can get away with it. but there was something awkward about the way kaine did it to the point of being annoying. it wasn't annoying in 2012. trust me, i was frustrated but i -- because i worked on paul ryan's debate prep. but i found kaine annoying in a way i did not find biden. >> here is another way it didn't work. i have known senator kaine for decades. he was my mayor in richmond, my governor. i live in virginia. now he is my senator. for so many people, who were watching last night, the ratings were off from four years ago. but still, millions of people watching. tens of millions. senator kaine was totally new to them. it is tough to have that person be introduced to you and be

doing all that interrupting. he had been prepped to be tough and aggressive. to let nothing go. but when you are trying to shake hands and meet the audience, that is really tough. that is why jon and dan talk about the style points. you watch pence and he was very conscious of the box he was in. he was talking to the audience, and people said that his mind was on getting a job on fox after this election. clever note i got, saying maybe not so crazy for pence to get a job on fox. and looking ahead to 2020. he certainly helped himself. senator kaine scored by, as jon has written, compiling a lot of material that now the and -- clinton campaign can use against the trump pence ticket.

msnbc lawrence , o'donnell said, he was going to take a lot of clips of pence saying trump had never said anything and put it up against video of trump and pence saying it. the clinton campaign beat him to it by a day. now up with a video, fixed into john's article, where they care him up and it's pretty devastating. >> i saw the video in john's article. you should get a commission from the clinton campaign. it is effective what they did, showing all the things that pence denied about trump wench am in fact said them. i don't know how many people will actually see it. not nearly as many watched the debate. first impressions matter and pence came off better than kaine. i think he did two other things for trump. these people are apprehensive of trump. not just rejecting, but apprehensive.

concerned. a percentage of republicans are not getting behind him. pence sent a message, i am exhibit a of the kind of people he will surround himself with. i can give you reassurance. that is not nothing. charlie: it was mike pence. there is some confidence he will choose people who are qualified. dan: if conservatives are concerned, mike pence is an authentic movement conservative. that said, i do think that denying trump statements the way jonathan writes about, i don't think that will be a huge problem in the short term. i think it will be in the long-term. if he has aspirations for 2020, whatever he wants to do. it was pretty indisputable. pence was quoting donald trump. saying, donald trump did not say those things. it wasn't even gray area. nothing ambiguous about it. it was black and white. over time, it did chip away at pence's credibility. >> quick on that point.

maybe the quote of the evening. vice president biden who gave an interview on cnn, talking about how governor pence had to constantly defend donald trump, and vice president biden said, hell of a way to make a living. charlie: what do you think president obama thinks about this? is he anxious to get into the debate because his legacy may be at stake? >> he clearly realizes his legacy is at stake for a number of issues. take the paris climate accord. which was signed today. donald trump is a climate change denier. he says it's a chinese hoax. he wants to build as many coal plants as he can and says he will get out of the agreement as soon as he takes office. would cause the thing to collapse. would cause climate change to run out of control. that is probably president obama's biggest legacy. on this and many other things, he is very aware he needs a

hillary clinton to win to safeguard the policies he has put into place. charlie: is he girding for action? my question, is he anxious to get into the fray? jonathan: i thought in some ways he is. it was interesting to watch his speech in the convention. when he was talking about trump he was almost breaking up. he almost couldn't help but laugh at the idea of trump as president. people who have that job have that reaction. he is amused and offended and kind of alarmed. it is something that is very near to him. he would like to mix it up. ♪ charlie: do the three of you

disagree with what one friend said to me at the end of last week? the superstar political talent of this season is michelle obama. >> yes. >> we saw that at the convention. we have seen her out on the trail. charlie, as you know, and as dan and john know she has been a , reluctant public face during much of this administration, but she has been doing so fantastically. i think they are united in the importance of going out to prosecute the case against trump, they are enjoying it. clearly the president is.

you and i talked about the fact that he, for one thing, he enjoys showing secretary clinton how it is done. he just loves taking it to him. second, a congressman told me he was in the limo with president obama. president obama was repeating to him some of his best lines from the white house correspondents dinner when he got trump. i think he is enjoying this. >> she is a huge talent. when i watched the democratic debate, excuse me, the democratic convention. each of these people speaking. joe biden, elizabeth warren. michelle obama. any of them. i disagree with them, but anyone of them would have been beating trump by 10-15 points. the contrast between michelle obama and hillary clinton, a retail political skills and

oratory skills, is day and night. i think had she not denied so vehemently any interest, everybody would have been recruiting her. >> i absolutely agree. she is extraordinary talented. it is all the more remarkable she is not a politician. she has not spent her life giving these kinds of speeches. she has public speaking experience, but this is not her application -- avocation. and yet she is so incredibly effective. charlie: she was even reluctant about him getting into it after he lost the congressional race. let's look ahead to sunday night. what does donald trump have to do in this debate? or is it too late? mike: it is not too late. this townhall format could play to donald trump's strengths. i can tell you his team says they are happy to have regular

people asking the questions as opposed to a moderator. he did well in the townhall format in the republican primaries. but, and the reason dan can certify this, the republicans are so worried about this debate and are not particularly bullish about the fact we are going to have a totally new trump on sunday night, they are worried about him overreacting. worried about just as he took the bait, the fact that he kept taking the bait from secretary clinton, people close to him are worried about him doing that with the questioners in st. louis. and coming off as too hot. dan: i think people around him are trying to get him to prepare like mike pence did. not prepare like he did for the first debate. many of us all say, at what point will donald trump truly change?

when will the pivot actually come? we are five weeks out. he has campaigned, minus some small interruptions, he has campaigned the same way for this election. it is how he has operated in public life for the past four decades. the fact that he is going to suddenly change, given how easily his buttons are pushed, and i don't necessarily think a townhall is a better format for him. it is an awkward situation. preparing for that it is among , the most difficult kind of formats to prepare for. you don't know who to look at, who to respond to. the questions can come out of left field. with regular journalists, you can predict what the questions are going to be. people just coming with everyday concerns, you can get anything. he has campaigned one way. he has not changed. the format has all sorts of

variables he could not truly prepare for. i have a hard time believing this is where he turns it around. charlie: hillary clinton has said, there is no new donald trump. mike: a great quote, if there is one guy who is not changing, it is a 70-year-old billionaire. [laughter] donald trump thinks this has worked for him. a quote someone involved in preparing him for the debate told me, mike, don't forget, there is a difference between prep sessions and prep occurring. they are having sessions. that doesn't mean donald trump is internalizing it or changing his approach to life in this interim. jonathan: can i make a point? i have seen so many republicans

talk about donald trump's inability or unwillingness to do basic preparation for the debate. as if it is a problem for the campaign as opposed to the -- a complete disqualification for the presidency. a lack of attention span, interest in acts. refusing to take this job seriously. the conclusion republicans should be making is that this man should not be president, not do a better job fulling the the republicooling into thinking he should be president. dan: i think the way a person runs for president is often a window, how they deal with surprises and manage it, very much a simulation for being president. not a perfect simulation. charlie: what did that say about romney? dan: i think he would have been a good president. he ran a losing campaign. but he wasn't donald trump.

barack obama and mitt romney were both competent. charlie: 2012, he was a vulnerable candidate. dan: i'm not sure he was as full -- vulnerable as people think. he has a massive demographic advantage. the economy and the perception was the economy was starting to come back. incumbents rarely get thrown out of office. i think obama ran a better campaign. i think romney ran a good campaign. i don't think donald trump is running a good campaign or could be president. we are being constantly reminded of this. including a few nights ago. mike: to agree with his point, the washington post did a fantastic biography book in august. the most interesting sentence, indy book -- in the whole book. the authors went to see trump at trump tower. one of the most fascinating things he told them, as this process moved along, he was thinking about reading a book

about a president. but didn't have time. charlie: there's also the announcement al gore will be campaigning for hillary clinton on issues like climate. >> that has been the understated issue of the campaign. i don't think any of the debate moderators have brought it up. didn't come up in the presidential debates. it is probably the most important issue of the cycle. charlie: president obama called it a national security issue. the most important threat to the united states over the long-term. >> you don't have words to express how important climate change is in maintaining and continuing to progress of the paris climate agreement. it has been frustratingly absent. i think it is a problem in the republican party which will not engage on this issue whatsoever. it is also a problem of the news

media which will not present the issue before the voters anyway -- in the way it deserves. dan: i disagree with jonathan about the issue, but as a political matter, i think the reason you have al gore coming out. the reason hillary clinton brought it up is because they are trying to motivate certain parts of the obama coalition. i wouldn't say they are unmotivated, but not highly motivated. millennials, climate change is an issue. you can speak directly to young people. if they don't beat trump among millennials by massive numbers they are not going to win the , election. that is the most important part of gore coming out. charlie: about the second debate, i meant to say, not it is too late now for him. but if in fact this debate is the last best chance for him, donald trump, to change the momentum of this thing.

if he fails to make a difference in the debate coming up on his sunday, road is much harder? mike: that is exactly so. there is one thing he needs to do in that is what i told you he needed to do in the first debate. he needs to come off as a plausible commander-in-chief. he has to pass the commander-in-chief test. you watch the focus groups you , go around, you ask people for one word to describe the candidates. they talk about hillary clinton. it is all very critical words. undecided voters get to trump, they are equally critical. but they want change. this is a change environment, for all the reasons dan said. a conventional republican would be in such good shape. if donald trump came across as someone who could be commander-in-chief, that you could trust, there is a

potential, tremendous potential for him to have a higher ceiling. so far, he has been in the 38-42% band, and he will not break out of it if he cannot be imagined in the oval office. charlie: personality and behavior have prevented him from making the change argument. dan: voters in a change election are very tolerant of imperfections if that candidate is a change candidate. they will tolerate a lot. running against hillary clinton, they would tolerate a lot of the republican nominee. i just think trump is a bridge too far. the temperament issue, many of us cannot imagine him in the situation room. are terrified by the image. can't imagine him in the oval office. that is what is giving people cause. jonathan: i don't think that is what the electorate is up to. i don't think that is right.

look the president has approval , rates of between 52% and 58%. depending on the polls. the problem is the democratic candidate is personally unpopular. and grew increasingly so during the campaign. i don't think there is a huge clamoring for change. there is a distrust for her and that is different. dan: a distrust of her and high wrong track numbers. the majority of voters -- jonathan: there have been high wrong track numbers. for decades. those don't correlate to anything. they don't correlate to a desire to change parties. people have studied this and looked at any correlation between the numbers and behavior and it doesn't exist. that number is not relevant. dan: personal popularity, job approval rating, this electorate is open to a change. clearly or else donald trump would not be where he is. why is he performing the way he is?

jonathan: because hillary is personally distrusted. charlie: i think there is a significant portion of the working class of america, men and women working and without college educations, hard-working who fight the wars and pay the taxes. there is a dissatisfaction with washington. jonathan: the non-white working class is heavily supportive of the democratic nominee. you are talking about the white working class, a republican constituency for a long time. charlie: frank luntz found out in the polling he did, when the meters suggested this to him, people are less concerned about donald trump's taxes than hillary clinton's e-mails.

are we expecting anything to happen, julian assange, that might have an impact on the election? is there buzz or talk or any reason to believe? something coming along in october? >> i am skeptical, what they came up with in the last couple of days didn't wow. if there is anything that provides more shock value, i'm dubious. i think the tax issue is a major problem over time. she has not had a debate where she could say, now we have a window into your tax returns. now she could take that point. i don't care what you think republican, democrat, , working-class, the notion that someone who has gotten away with making massive amounts of money and not paying any taxes, that seems offensive to some. deeply off. that is going to be a problem for trump over time. charlie: i want both of you to come in.

on that point, the argument is made what angers most americans, less than whether he paid taxes or legally used tax escapes, is the way he treated people for -- who worked for him. he would not pay them. problems with people who said they were not paid for their labor. jonathan: you hear so many of these stories. a family business that supplied pianos to the casinos in atlantic city. you hear so many of those stories. the other thing that bothers people, losing $1 billion. that doesn't seem like a good idea either. on the e-mails, private conversations among democrats in washington, i can tell you they are worried. charlie, it is a fact more has has beenhacked than

leaked. that is a risk. charlie: i think there is a general sense of despair about washington. everywhere you go, people talk about the impact of gridlock. whoever gets the blame, that establishment in washington. that is an element of the desire for change and it is a change election. we may not have candidates that satisfy the criteria but there is a demand. >> public opinion turned sharply skeptical of institutions around watergate and vietnam. that has been largely true, with the exception of a few times when people rally around the flag. after 9/11 and so on. that is a basic landscape. i don't see characteristics that people want a change in parties or administrations. i agree that hillary clinton has perception problems. when the news media focuses on scandals, real or imagined, around her, that was the time in the election when she plummeted

and drew close to a tie. if something like that happens between now and the election, the election could get tight. i agree. we have different causes in mind for what is the source of her vulnerability. charlie: what do you think she has to do? jonathan: she has to avoid providing material that could be grist for the news media. if the stories come up, she has a deal with it in the quickest, most open and transparent way to avoid giving them an excuse for more scandal coverage, which is what sunk her briefly a couple weeks ago. charlie: thank you so much. great to see you. we will be right back. ♪ ♪

charlie: jim lentz is here. he is the ceo of toyota north america. the auto industry has undergone tremendous shifts in recent years. autonomous driving, artificial intelligence, sustainable fuel technologies, they are changing the role of cars in our everyday lives. toyota announced a new partnership with uber to collaborate on mobility services. i want to talk about all of that and i am pleased to have jim lentz at the table. i want you to help us understand, where is the automobile industry today? we can figure out where toyota

fits in that. when we look at what we think of as the industry, we understand how technology is delivering up driverless cars. we know of the demands for energy efficiency. we know of the global differences and global markets. producing larger and larger middle classes, all of that. jim: is adjusting. -- it is interesting. i have been doing this for 34 years. the business used to be relatively easy. you would try to forecast, what is the market going to be? where's the economy, where are the interest rates, how is consumer confidence, how big is the market how many are going to , be cars and trucks? that has changed. you still need to do all that. now you need to throw in fuel price. what kind of engines should we be building? you mentioned not just internal gas engines, hybrids. plug-in hybrids. fuel cells. all of that. beyond that, it is what happens with safety. that is the traditional way of looking at our business.

today, you have to look at micro mobility. things like how do we help people get from their home to public transportation to their office and back? what happens with personal mobility? we believe mobility is important for all. people with disabilities, how can we use the technology we are developing for autonomy? put it into motorized wheelchairs? or into aides for the blind. on top of that, you've got to think about how people consume transportation in the future. whether ridesharing or car sharing. it is a really complex environment. charlie: how do people consume transportation? do companies have to say to themselves, we are looking at a future in which there will be a declining number of people in terms of percentages who will own their own car?

jim: difficult to say. i tell you why. i may be an outlier and this. -- in this. if you look at why ridesharing -- it is the predominant sharing in the u.s. compared to car sharing in europe -- it really developed out of gen y. they came out of school and they were hammered by the recession and had debt and they really created this sharing economy. the question becomes, what happens as their lifestages change? as they began to have families? as they move back out of the cities, they are not moving into the suburbs the way our parents might have, but what happens to their driving needs? because they are the ones who have driven this sharing environment. we are seeing now, last year, almost 30% of industry sales were to the millennials. we think it will be 40% by next year. so what impact does that have on

this sharing environment? on top of that if you look at , gen z, 17 and younger, 95% are getting a drivers license in the first two years. so between when they qualify -- jim: 95% are getting a license by 16. if you ask them, will you own a car, 90% say they will own a car by age 19. so the challenge becomes, is this generational or is this something that is in its infancy and going to peak? so as a manufacturer you have to be involved and the good news is so far they are not driving flying carpets. they are still driving cars. there is still a business for cars. the reality is the more car sharing is done, the more miles will be on the cars and the shorter the turn cycle will be. so there is a good business for

a manufacturer but he have to -- we have got to understand it. charlie: the question is, what kind of cars? when you have looked at that, what your data says, what kind of hybrid or whatever kind of fuel are we going to be using? jim: for all cars, it is interesting. if you look at hybrids, plug in hybrids, fuel cells and electric vehicles, it is about 2.5% of the industry. 2.5%. it was almost 4%. charlie: 97% is fossil fuel driven. jim: there are about 70 of those nameplates chasing 2.5% of the market. if you look at the passenger car side, 50 passenger cars. in that pile. prius is the biggest player, we sell 11,000 a month.

the rest of them average about 450 a month. if you look at the truck side, rav 4, the rest sell 125 a month. if you look at pure electric, 0.5% of the industry. so the question is, how much will that grow? how much can regulation kind of lead consumers in that direction without getting too far ahead? charlie: what would catalyze it? what would dramatically increase the velocity? jim: fuel price. there is a direct correlation. between fuel price and the adoption of these new technologies. customers still get a pencil and calculate, what is the cost of paying for this additional technology? charlie: if they can't figure it out -- i mean, today, fuel prices are way down.

does this affect, this is the big question that often is asked. are you putting enough research into creating alternative fuel? jim: we are. if you look at hybrids, of which we are 70% of the market -- prius is 70% of the market. we sold roughly 8 million of them globally. we have a good understanding of the market. we started the research on that product in 1992. we started researching hybrids and fuel cells. our view will the world was we were going to hit peak oil sometime around 2025. hybrids would be able to squeeze

oil for certain time. the next move was going to be butthe next move was going to be hydrogen. we were fairly accurate on what was happening with hybrids. the challenges, technology has allowed us to find a lot more oil. we have a lot more in the ground. fracking, deepwater drilling. charlie: it has enabled us to drill and find more fuel. so when does crisis come? it has just been pushed back? jim: it has been pushed back. the challenge becomes, if gasoline stays low, two dollars, it is going to be difficult for us to convince customers to buy this alternative future. if you look at ev's today, the biggest seller in the mainstream market has about $18,000 of incentives.

they sell at a discount to their gas counterparts. that is a challenge. just straight ev's. charlie: what is a straight ev? for you? jim: we had a ev rav-4. them andbout 3000 of it went out of production about two years ago. today we are betting that the next generation is what we feel is a better battery, and that is hydrogen. we are selling fuel cells in california. it basically is an ev, and electric vehicle that produces electricity when you step on the accelerator. as opposed to carrying around on a big heavy battery. our hydrogen vehicle goes little over 300 miles. it re-fuels in 3-5 minutes. you don't have large charge . rangerge periods or

anxiety. the challenge is we have to build that infrastructure. california probably has done the most in that regard. they have funding for about $200 million in grants. there are about 21 stations today. there will be 30 by the end of this year. probably about 50 by next year. to service 10,000 fuel cells, on the road you need about 70 stations in the right location. so it is doable. charlie: people saying, this is a problem not just in terms of the availability of fossil fuels, it is also the climate and climate change. one of the principal polluters is cars. jim: we are part of the problem. that is why we had the foresight to develop hybrids. plug in hybrids that will get over 100 miles per gallon.

so we can stretch that out. but the real solution long-term is hydrogen. there is a lot of hydrogen available. today, it is basically created from natural gas. by stripping out carbon. in time, we will create green hydrogen. so the hydrogen that goes in will be carbon free. the exhaust is water vapor. so to us, that is the holy grail. charlie: you assemble them mostly in the u.s.? jim: the fuel cells are coming out of japan because the volume is so small. charlie: in terms of the market in china, the emerging middle class, are their tastes the same or does it differ because of cultural differences and economic circumstances?

jim: it is very interesting and -- in china. it is the largest market in the world for cars. in excess of 20 million vehicles. primarily, the top one or 2%. not even making the way to the middle class, especially for the type of quality cars we produce, that the big three produce or even the suppliers in china produced. it is interesting, their tastes are changing. almost the same as american taste. so passenger cars are kind of falling out of vogue. they want suvs. not pickup trucks. small suvs are very popular. very much like america. that has just happened in the last couple years, very much like america. charlie: how do you explain that? jim: it is difficult. they like to emulate many things that happen in america. charlie: there was a story about

the wealthiest man in china. he wants to dominate the movie business globally. because they now have the number one market in the world. if you are the number one market for anything, you are going to have a powerful incentive to be dominant. jim: it is an interesting industry. very much like the u.s. industry was at the turn of the early 1900s. there are probably 200 manufacturers of vehicles in china. there will be massive consolidation at some point in time. and they will end up with a very strong domestically produced car industry that will be big competition for all of us on a global basis. charlie: how soon will that be? jim: it will be a while. you see some of their vehicles in south america, eastern europe, europe. nothing yet in the u.s.

we are a tough nut to crack over here. stringent regulations on safety and emissions. charlie cole and we have the most stringent commissions standards -- charlie: do we have the most stringent emissions standards? scandinavia is going all of diesel, ours are stronger than even europe. in terms of gas europe like little stronger but in total we have really tough emissions. charlie: if you are a car dealer, how do you make money? what is it, for example, it ain't the markup on the car, i don't think. [laughter] jim: you make money by taking great care of customers. it is all about customer loyalty. it is about taking great care of your customer so they come back and buy cars from you again. your family does. trade-ins. you come back for service on the car. it is about creating loyalty

with customers. are sports cars? jim: they are falling down a hair. convertibles, less than 1% of the market. sports cars, by themselves, they tend to be extremely hot the first two years in the marketplace. and they have a rapid decay for their lifecycle. it is a tough business to be in. charlie: pickups in america, big item. the ford f150 is still the biggest selling vehicle. is it big in other markets? jim: canada as well, but it is a north american phenomenon. charlie: how do you explain that? jim: i think it is image. automobiles represent freedom for a lot of people. especially as you go into the

west, it is kind of like having a horse. it is still that freedom. charlie: very much in the mountains and the west. toyota, first of all, and i don't have this, but you had some problems in terms of that went to the art of toyota's image. what have you learned about brand, protecting brand, rebuilding brand? making sure you recapture? jim: it was a difficult lesson. i can tell you the three primary things we learned. number one, make sure you listen to customers. not just hearing their voice, but listening to what they are telling you. number two, be transparent. transparent with information within the company and information outside the company to regulators and everyone else

and number three, be quick about it. that was a tough lesson for us. listen and respond. i can tell you today, as a result of that, we are a much stronger company. we are stronger, we are closer to the dealer body. they lived through this as much as we did. i think our loyalty to our customers is stronger today. as a result. charlie: is buy american an advantage for general motors, or does toyota seem like an international company? a global car company. and if they provide a better car -- jim: it depends on the buyer's mindset. today 71% of what we sell in , north america is manufactured in north america. cars like the camry, the number one parts of any vehicle sold in the united states, more so than the f150, so it depends.

consumers that are predisposed to purchase imports will purchase an import, regardless of where it is built. those predisposed to only purchase domestics, in their mind domestic meaning domestic nameplates, so you have these two camps. that group that you can influence is relatively small in the middle. charlie: you have consolidated everything in plano, texas. jim: yes. charlie: a little west of dallas and a middle east of fort worth. [laughter] jim: we have campuses under construction in temporary facilities now with 1000 people. we will start moving of spring, next year. the move will be complete by october. charlie: what is the biggest challenge for you? jim: what keeps me up at night is forecasting the price of fuel.

it is difficult. we have to make decisions three years out on capacities. if gas is two dollars a gallon, people are going to buy certain vehicles. if it is four dollars a gallon, they are going to buy others. it is tough. for the finance company a lot of vehicles are leased today and they have to forecast out probably seven years, with the price is going to be. charlie: 2016. how many cars will you manufacture for the year 2016? jim: in north america, roughly 2 million. we will sell about 2.5 million. about 500,000 will come from japan or other areas. we are predominantly a north american company these days. charlie: let me talk about technology. more and more technology is pouring into cars. we are talking about economists tonomous driving.

give me a sense of the landscape over that. 50% of deaths on the highway are caused by distraction. is it a number like that? jim: pretty close to that. autonomous driving is the holy grail. because the goal is to develop cars such they cannot be involved in an accident. obviously that will take some time and we feel it is going to evolve. the first step is what we call guardian angel. you are still driving your car. you have control. hands on the steering wheel. just as you normally would, but there are sensors on the car, radar, cameras, other types of sensors. it will sense if you are about to make a mistake. you are going to pull in front of another car. you are going to pull off the road. the car will take corrective action and not allow you to get

into that accident. now in time, probably post 2025, we will have full autonomy in cars. it may be 2050 before all the cars have that technology. that is a long way down the road. but at some point in time, you will have cars not involved in accidents. you won't have to be driving them. we are firm believers that people still have joy of driving. we will develop cars that first and foremost are this guardian angel. customers will choose what they want to do. i think guardian angel will be available by about 2020. it is right around the corner. charlie: how are you using artificial intelligence? because autonomous driving is going to need a lot of data.

you said to me, a trillion miles before you can fully make sure and be confident. you have to put through a trillion mile test and that is a long time. jim: that is where artificial intelligence comes in. we can simulate what will happen, what the car has to react to, because the reality is, to try to get to one trillion miles will be impossible. without artificial intelligence, we do not believe full autonomy will be obtained. we are investing through toyota research, about $1 billion just to develop the artificial intelligence. the best part of that, what we have learned from that, we will be able to take into the home. we will be able to create robots. we will be able to create, we were developing a device called blade that actually uses gps indoors. we will be able to map a shopping mall.

so someone that is blind will have this around them and have cameras and microphones. it will tell them where stores are based on the logos of the store. where elevators are. restrooms. that to us is true mobility. charlie: is also a new definition of what you do as a company. mobility. you are becoming something other than a car company. jim: i think we have to. i think that is important. especially if you look at the generational shifts and changes we will have, being led in japan primarily because they have a population that is much older than the rest of the world. as us boomers age, that will be critical. that we have that freedom of mobility, whether through an autonomous car, devices that can help us be mobile in our homes. whether we have mobile assistive robots.

all that is going to be critical for us to maintain our freedom. ♪ ♪ ♪ ♪ ♪ ♪

mark: i'm mark crumpton, you're watching "bloomberg technology." let's begin with news. hurricane matthew is battering the east coast. state officials quickly declared emergencies in florida, georgia, and south carolina. more than two million residents have been warned to evacuate. after reaching areas cut off by the storm, haitian officials have dramatically increased the number of fatalities. 108 people now confirmed dead. the previous number was 23. russia has issued a warning to the u.s. against attacking forces allied with the syrian government. it's the latest sign of escalating tensions between moscow and washington. the kremlin said strikes targeting government controlled territories are a direct threat