Tim Kaine Argues Positions on Syria, Vladimir Putin; Mike Pence Struggles to Defend Donald Trump; Second Presidential Debate this Sunday;



Struggles to Defend Donald Trump; Second Presidential Debate this Sunday;

New Partnership between Toyota and Uber on New Mobility Services - Part 2>

University in Virginia, with only 33 days until the election, Governor Mike

Pence and Senator Tim Kaine argued their candidate`s positions on Syria,

Vladimir Putin, and abortion and other issues. The consensus among

analysts was that Governor Pence delivered a stronger performance, but

struggled to defend Donald Trump. The second of three presidential debates

will be held this Sunday at 9 PM. Earlier this year Toyota announced a new

partnership with Uber to collaborate on new mobility services. >

Donald Trump; Automotive Industry; Uber; Toyota; Technology>

DAN SENOR: This electorate -- this electorate is open to a change. Clearly, Donald Trump wouldn`t even be where is he. Why is Donald Trump performing the way he`s performing.

JONATHAN CHAIT: For the reason that I just gave you which is that Hillary Clinton is very personally untrusted.

DAN SENOR: And she`s also because she`s a proxy for the status quo.

CHARLIE ROSE: No, Jonathan, I`m not disagreeing. I`m not suggesting I know anything more than anybody. I do think there is within a significant portion of the working class of America, men and women who are working and without college educations, but hardworking who fight the wars and pay the taxes and all of that. There is dissatisfaction with Washington, this year.

JONATHAN CHAIT: You are talking about the white working class, right?


JONATHAN CHAIT: the non-white working classes heavily Democratic and heavily supportive of the Democratic nominee. So, yes, you`re talking -- you`re right about the white working class, but that`s been a Republican constituency for a long time.

CHARLIE ROSE: Let me raise one last issue, and it goes back to Frank Luntz. Frank Luntz found out in the polling that he did among those people that he sampled in the focus group, that when -- the meters suggested this to him, people are less concerned about Donald Trump`s taxes than they are about Hillary Clinton`s emails. Are we expecting anything to happen for this Julian Assange or whoever it is on the email front that might have an impact on this election? Is there buzz, is there talk, is there any reason to believe that something will come along that will be an October surprise?

DAN SENOR: I`m skeptical. I mean, what he came up with in the last couple of days didn`t, you know, didn`t wow.


DAN SENOR: If he does have anything that exceeds -- you know, provides more shock value than it`s already out there, I`m dubious. And I do think the tax issue is a major problem over time. The more Clinton -- she hasn`t had a debate where she could actually say we now have a window into your tax returns. That wasn`t the case in the first debate. Now, in front of a massive audience she can make that point. And I don`t care what you think, Republican, Democrat, working class, wealthy, whatever, the notion that someone has gotten away with making massive amounts of money and not paying any taxes seems offensive to some, deeply like off. And I think it`s going to be a problem for Trump over time.

CHARLIE ROSE: On that point too, I want both of you to come in Washington to come in on that. On that point, the argument also has made that what angers most Americans, less than whether he paid taxes or, you know, legally used tax escapes, is the fact that the way he treated people who work for him. And the fact that he wouldn`t pay them and they had real problems, and a lot of testimony about people who said they weren`t paid for their labor.

MIKE ALLEN: Charlie, there`s so many of these stories. One that I read recently was a family business that had supplied pianos to the casinos in Atlantic City. You do hear so many of those stories. The other thing that I think bothers people about "The New York Times" story is losing a billion dollars. Like, that doesn`t seem like a good idea either. On the emails, Charlie, private conversations among Democrats in Washington, I can tell you that they`re worried. Because, Charlie, it`s a fact that more has been hacked than has leaked.


MIKE ALLEN: And therein lay risk.

CHARLIE ROSE: All right. Jonathan, we`ll come back one more time on the notion, I just think there is a general sense of despair about Washington, and everywhere you go, whoever you listen to, talks about the impact of gridlock. Whoever gets the blame -- who gets the blame is the establishment in Washington. And I do think that that is an element of the desire for change, and that there is a change election. We may not have candidates that satisfy the criteria for change, but there is a demand for change.

JONATHAN CHAIT: Well, public opinion turns sharply skeptical of all major institutions around Vietnam and Watergate, and that`s largely been true, with the exception of a few periods, we would rally around the flag after 9/11 and so on. So that`s just the basic landscape. But I don`t see any characteristics that say people want a change in parties, want a change in administrations. I agree with you that Hillary Clinton has perception problems. And when the news media focuses on scandals real or imagined, around her that was the period in the election when she plummeted and drew close to a tie with Donald Trump. So, if something like that happens between now and the election, this election could get tight again, so I agree with that. But I think we have different causes in mind for what is the source of her vulnerability.

CHARLIE ROSE: And so, therefore what do you think she has to do, Jonathan?

JONATHAN CHAIT: I think she has to avoid providing any material that could be grist for the news media. And if any of these stories do come up, she has to try to deal with it in the quickest, most open, most transparent way possible to avoid giving the news media an excuse for more scandal coverage which is what sunk her briefly a couple weeks ago.

CHARLIE ROSE: On that, thank you so much. Good to see you, Dan. Great to see you, Jonathan. Great to see you, Mike. We`ll be right back.


CHARLIE ROSE: Jim Lentz is here, he is the CEO of Toyota Motor North America. The automotive industry has undergone tremendous shifts in recent years, autonomous driving, artificial intelligence, a development of sustainable fuel technologies. They`re all changing the role of cars in you are everyday lives. Earlier this year Toyota announced a new partnership with Uber to collaborate on new mobility services. We want to talk about all of that and I`m pleased to have Jim Lentz at this table. Welcome.

JIM LENTZ: Thank you, Sir.

CHARLIE ROSE: I want you to put this for just to help us understand, you know, where is the automobile industry today and so we can figure out where Toyota fits in that? But when you look at what we think of the auto industry, we understand how technology is delivering up driverless cars. And we know of the demands for energy efficiency. We know of the global differences. And the global markets that are producing larger and larger middle classes, all of that.

JIM LENTZ: Well, it`s interesting, because I have been doing this for 34 years now. And the business used to be relatively easy. You try to forecast what is the market going to be, where is the economy, where are interest rates. How is consumer confidence? How big is the market, how many are going to be cars, how many are going to be trucks?


JIM LENTZ: But that really changed today, because you still need to do all that, but now you have to throw in fuel price. You have to decide what kind of engines, should we be building. As you mentioned, not just internal gas engines, hybrids, plug in hybrids, fuel cells, EV`s, all of that. Beyond that it is what happens with safety and autonomous driving. And that`s just kind of the traditional way of looking at our business.

But today you`ve got to look at what do we do with micro mobility. So things like, how do we help people get from their home to public transportation, to their office and back. You know, what happens with personal mobility, because we believe that mobility is important for all. So people that have different disabilities, you know, how can we use the technology that we`re developing for autonomy and put it into motorized wheelchairs or put it into aids for the blind, so all of that. And on top of that, you have to think about how people consume transportation into the future. Whether its ride sharing or car sharing. So it`s a really, really complex environment.

CHARLIE ROSE: On the last point, how do people consume transportation? I mean do auto companies have to say to themselves, we`re looking at a future in which there will be declining a number of people in terms of percentages, who will own their own car.

JIM LENTZ: Difficult to say right now. And I will tell you why. I may be an out lighter in this, but if you look at why ride sharing, and ride sharing is the predominant sharing in the U.S. compared to car sharing in Europe. But it really developed out Gen Y. Gen y came out of school, they were hammered by the recession, they had college debt and they really created this sharing economy.

So the question becomes what happened s as their life stages change. As they begin to have families. As they move back out of the cities. They`re not moving into the suburbs, the way our parents might have. But what happens to their driving needs, because they`re really the ones that have driven this sharing environment. And we`re seeing now that last year almost 30 percent of total industry sales were to the millennial generation, 30. We think it will be 40 percent by next year. So what impact does that have on this sharing type environment? And on top of that, if you look at Gen Z, those are 17 and younger, pretty short wheel base to look at the data, but 95 percent are getting driver`s license in the first two years. 19.

CHARLIE ROSE: So between the years -- they are qualified that which used to be age 16 or whatever it is now.

JIM LENTZ: So it`s 16 years old, 95 percent are getting a license by 16. And if you ask them, will they own a car, 90 percent say that they will own a car by age 19. So the challenge becomes with this ride sharing car sharing is, is this generational, or is this something that is just in its infancy and it is going to peak. So you know, as a manufacturer, you have to be involved.

The good news is, so far they are not driving flying carpets. They`re still driving cars, so there is still a business for that. And the reality is, the more car-sharing that is done, the more miles will be on the cars and the shorter the turn cycle will be. So there is still good business to be had for manufacturers, but we`ve got to understand it.

CHARLIE ROSE: Ok, so then the question also comes is what kind of cars. When you look at that and your data says to you, about with kind of hybrid or whatever kind of fuel we are going to be using.

JIM LENTZ: For all cars or just for the ride share.


JIM LENTZ: Well, for all cars.

CHARLIE ROSE: For all cars first.

JIM LENTZ: Foe all cars, it is interesting. If you look at all hybrids plug in hybrids, fuel cells and electric vehicles.


JIM LENTZ: It`s about two and a half percent of the total industry.

CHARLIE ROSE: Two and a half percent.

JIM LENTZ: Two and a half, two and a half. It was almost four percent.

CHARLIE ROSE: So that is (inaudible) is fossil fuel driven.

JIM LENTZ: Yes, yes. And there are about 70 of those name plates chasing two and a half percent of the market. So if you look at the passenger car side there are 50 passenger cars in that pile, Prius is by far the biggest player now. We sell about 11,000 a month. The rest of those name plates average about 450 a month. If you look at the truck side where rav4 is the biggest, if you pull Rav out, they sell 3500 a month, the rest sell 125 a month.

If you look at just pure electrics, it`s .5 percent of the industry. So the question is how quickly will that grow? How much can regulation kind of lead consumers in that direction without getting too far ahead of us.

CHARLIE ROSE: And what would catalyze it? What would dramatically increase the velocity?

JIM LENTZ: Fuel price.

CHARLIE ROSE: Fuel price? JIM LENTZ: Fuel price.

CHARLIE ROSE: Fuel price goes through the roof.

JIM LENTZ: Yeah, there is a direct correlation between fuel price and the adoption of these new technologies. Customers still get a pencil out and they calculate, you know, what is my payback for paying for this additional technology?

CHARLIE ROSE: And if they can`t figure it out, if fuel price makes it an attractive alternative.

JIM LENTZ: Yeah. Today fuel price is.

CHARLIE ROSE: It will go right down, two to three dollars.


Rose. Does this affect, and this is the big question, that often is asked of auto companies. Are you putting enough research into creating alternative fuel?

JIM LENTZ: We are. I mean if you look at hybrids of which we`re 70 percent of the market.


JIM LENTZ: We started.

CHARLIE ROSE: And Prius is how much of that?

JIM LENTZ: Prius is 70 percent of the market.

CHARLIE ROSE: It`s 70 percent.

JIM LENTZ: Its 70 percent, or hybrid. So we`ve sold roughly 8 million of them globally. So we have a pretty good understanding of the market. We started the research on that product actually back in 1992. So we started researching hybrids and fuel cells, because our view of the world was that we were thing to hit peak oil. It was going to be sometime around 2025. Hybrid would be able to squeeze oil for a certain period of time.

But the next move was going to be hydrogen. We were fairly accurate on what was happening with hybrids. The challenge is technology has now allowed us to find a lot more oil and get a lot more oil out of the grounds.

CHARLIE ROSE: It`s just frocking and everything else.

JIM LENTZ: Frocking and deep water drilling and everything else.

CHARLIE ROSE: Technology has enabled us to drill and find more fuel than we ever imagined.


CHARLIE ROSE: So when is crisis come? Or do he-- it`s just been pushed back to.

JIM LENTZ: I think it`s been pushed back.

CHARLIE ROSE: or forward, whichever it is.

JIM LENTZ: But the challenge.

CHARLIE ROSE: To a time uncertain.

JIM LENTZ: To time uncertain. And the challenge becomes if gasoline stays low, $2, $2.50, sometime into the future, it is going to be difficult for us to convince customers to buy this alternative fuel. If you look at EV`s today, probably the biggest seller in the mainstream market has about 18,000 dollar of incentive on it today. So they actually sell at a discount to their gas counterparts in the market place. So that`s the challenge.

CHARLIE ROSE: That includes hybrids or.

JIM LENTZ: Just straight EV`s.

CHARLIE ROSE: Just straight EV`s.

JIM LENTZ: Yeah, yeah.

CHARLIE ROSE: What is a straight EV for you?

JIM LENTZ: We had a Rav4 EV. We sold about 3,000 of them, went out of production about two years ago. So today we are betting that the next generation is what we feel is a better battery and that is hydrogen.

CHARLIE ROSE: Than lithium.

JIM LENTZ: Yeah. So we are selling fuel cells now in California and basically is an EV, it is an electric vehicle that produces electricity, when you stopped on the accelerator as opposed to carrying around big heavy batteries.

CHARLIE ROSE: Battery is a game, isn`t it?


CHARLIE ROSE: I mean, I think you all must just build a huge plant out in Nevada.

JIM LENTZ: He has.

CHARLIE ROSE: You look skeptical.

JIM LENTZ: Well, we just have a different view of the purpose of EV`s. We believe that electronic vehicles have their purpose in this shorter range micro mobility. So vehicles that may travel 50 miles which are much smaller, much lighter, much lower cost, but we think that vehicles that travel 250 or 300 mile range are better being hydrogen vehicles. So our hydrogen vehicle today goes a little over 300 miles. It refuels in three to five minutes, very much like gasoline. You don`t have large charge periods. And you don`t have the range anxiety. The challenge is we have to build that info structure, to be able to refuel these vehicles. And that`s.

CHARLIE ROSE: You have to do it or be built by anybody else.

JIM LENTZ: No, I think California probably has done the most in that regard. They have funding of about 200 million in grants. There are about 21 stations today. They will be roughly 30 by the end of this year, probably about 50 by the end of next year. And to service 10,000 fuel cells on the road, you need around 70 stations in the right locations. So it`s doable, but it`s a little behind.

CHARLIE ROSE: And so what do you say to those who say look, this is a problem not just in terms of the availability of fossil fuels or the cost of fossil fuels. It is also a question of the climate and climate change and we have to do something about it and one of the principal polluters is cars.

JIM LENTZ: We are part of the problem.


JIM LENTZ: But that`s why we had the foresight to develop hybrids. Plug in hybrids that will get over a hundred miles per gallon so we can stretch that out. But the real solution we think long-term is hydrogen. There is a lot of hydrogen available. Today it`s basically created from natural gas by stripping carbon out. In time we`ll be able to create green hydrogen. So the hydrogen that goes in will be carbon free. And the exhaust is nothing but water vapor. So to us that is the Holy Grail. That is the ultimate.

CHARLIE ROSE: Do you make all of the components of your cars.


CHARLIE ROSE: Everything, are you not subcontracting it out.

JIM LENTZ: Well, not in the case of fuel cells. We are doing it by ourselves.

CHARLIE ROSE: And you assemble them mostly in the United States?

JIM LENTZ: The fuel cells are coming out of Japan just because the volume is so small.

CHARLIE ROSE: So in terms of the market in China, just take one place, and the emerging middle class there and in other places, are their tastes the same or does it differ, because of cultural differences and economic circumstances.

JIM LENTZ: It`s very interesting in China. So it`s the largest market in the world for cars.


CHARLIE ROSE: It`s in excess of 20 million vehicles. Primarily has been the top one or two percent. So it is not even making its way to the middle class yet. Especially for the type of quality cars that we produce that the big three produce or even the big suppliers that China produces. But it`s interesting. Their tastes are now changing. Almost the exact same as American tastes. So passenger cars are now kind of falling out of vogue.

CHARLIE ROSE: Passenger cars.

JIM LENTZ: Yes. And they want SUV`s.

CHARLIE ROSE: Do they really?

JIM LENTZ: Not pick-up trucks.


JIM LENTZ: But small SUV`s are very, very popular now and that just happened in the last couple of years. Very much like America.

CHARLIE ROSE: Wow, how do you explain that?

JIM LENTZ: It`s difficult. I know they do like to emulate many things that happen in America.

CHARLIE ROSE: It is amazing. You know there is a story in the paper just last yesterday or today maybe. You know, about the wealthiest man in China. You know he really wants to dominate the movie business, globally, because they now are the number one market for movies in the world.


CHARLIE ROSE: And you are number one market for anything, selling cars will you have a powerful incentive to be dominant.

JIM LENTZ: Yeah. That`s exactly right. It`s an interesting industry though. It`s very much like the U.S. industry was at the turn of the early 1900st. There are probably 200 manufacturers of vehicles in China today. So there will be massive consolidation at some point in time. And they will end up with a very, very strong, domestically produced car industry. That will be a big competition for all of us on a global basis.

CHARLIE ROSE: How soon will that be?

JIM LENTZ: I think it will be awhile. Some of their vehicles in South America, you see some of their vehicles in Eastern Europe, some in Europe. Nothing yet in the U.S., we`re a pretty tough nut to crack over here, very, very stringent regulations on safety and emissions.

CHARLIE ROSE: Yes. We have the highest. We had the most stringent emission standards or is it something in Scandinavia or something?

JIM LENTZ: Scandinavia, especially like Norway is really going all electric. But in terms of diesels as an example, ours are much stronger than even what Europe is. I think on gas engines, Europe may be a little bit stronger than we are. But in total we`ve got really, really tough emissions.

CHARLIE ROSE: 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.

JIM LENTZ: No, it`s not. You make money by taking great care of customers. And I mean that is (inaudible).

CHARLIE ROSE: Customer loyalty.

JIM LENTZ: It`s all about customer loyalty. It`s about taking great care of your customer, so they come back and buy cars from you again.

CHARLIE ROSE: Right. And the family does and everybody does.

JIM LENTZ: And the family does and their trade-ins. You come back for service on the cars. So, it is really all about creating loyalty with customers.

CHARLIE ROSE: I said at the beginning I want to talk about the automobile industry and where it is. Where are sports cars? Is that simply a-- what do they say?

JIM LENTZ: They`re falling down a hair. So if you look at convertibles as an example. They are less than 1 percent of the market today, much smaller. Sports cars by themselves, they tend to be extremely hot the first two years they`re in the market place. And then they have a rapid decay for the rest of their lifecycle. So it`s a tough business to be in.

CHARLIE ROSE: Pickups in America, big item. Ford F-150.

JIM LENTZ: Still number one.

CHARLIE ROSE: Biggest single selling vehicle.

JIM LENTZ: Yes, yes.

CHARLIE ROSE: Is it big in other markets.

JIM LENTZ: No, it`s -- Canada as well. But it`s a North American phenomenon.


JIM LENTZ: And they are extremely strong.

CHARLIE ROSE: How do you explain that?

JIM LENTZ: I think it`s -- I think its image. I think automobiles represent freedom for a lot of people. And especially as you go into the West, it`s kind of like having a horse.

CHARLIE ROSE: Yes, it is.

JIM LENTZ: It`s still that freedom, you know.

CHARLIE ROSE: It`s a little bit like that in the south too.

JIM LENTZ: Yeah, yeah, very much so.

CHARLIE ROSE: Very much in the mountains and the West. So Toyota, so how are you going to -- first of all, Toyota, and I don`t have this - just to recall. But you know you have had some problems in terms of that have been -- that went to the heart of Toyota`s image.


CHARLIE ROSE: What have you learned about brand protecting brand, rebuilding brand, making sure that you recapture.

JIM LENTZ: It was a difficult lesson for us. But I can tell you the three primary things we learned. Number one is, make sure you listen to your customers. I mean, not just hear their voice, but really listen to what they are telling you. Number two is, be transparent. Be 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.

CHARLIE ROSE: Listen and respond.

JIM LENTZ: Listen and respond, but I can tell you today as a result of that, we are a much stronger company. We are stronger. We`re much closer to our dealer body, because they live through this as much as we did. And I think our loyalty is stronger to our customers today as a result of that.

CHARLIE ROSE: Is buy American an advantage for General Motors or Ford against Toyota, or does Toyota simply seems like an international car company, a global car company? And if they provide a better car, then you know.

JIM LENTZ: Depends on the buyer`s mindset. So today 71 percent of what we manufacture in North America is sold in North America. So cars like Camry`s, the number one parts of any vehicle sold in United States, more so than if F-150. So, it depends. You know consumers that are predisposed to purchase imports will purchase an import regardless of where it`s built. Those that are predisposed to only purchase domestics, in their mind domestics mean domestic name plates. So you`ve got these two camps on each end. So that group that you can influence is a relatively small group in the middle.

CHARLIE ROSE: You have simply consolidated everything in Plano Texas, right?

JIM LENTZ: Yes, sir, in the process of.

CHARLIE ROSE: A little bit West of Dallas and a little bit East of Fort Worth.

JIM LENTZ: Yes, were at the process now, we got the campuses under construction. We`re in temporary facilities now with about a thousand people. We`ll start moving probably spring of next year. And the move will be complete by probably October.

CHARLIE ROSE: What is the most, biggest challenge for you?



JIM LENTZ: Probably what keeps me up at night is forecasting the price of fuel.


CHARLIE ROSE: Is it right?

JIM LENTZ: And I would never sleep.

CHARLIE ROSE: Probably for the airline industry too, as I see.

JIM LENTZ: Yeah. Because it`s difficult, you know, we have to make decisions three years out on capacities. So if gas is $2 a gallon, people are going to buy certain vehicles. If its $4 a gallon, they are going to buy others. So it`s really tough. And can I tell you for the finance company, a lot of vehicles are leased today. They have to forecast out probably 7 years, what the price is going to be.

CHARLIE ROSE: Take 2016. How many cars will you manufacturer for the year-- whatever the model year is.

JIM LENTZ: In North America, roughly two million.

CHARLIE ROSE: You will manufacture two million.

JIM LENTZ: Yeah, North America.

CHARLIE ROSE: How many will you sell?

JIM LENTZ: About 2.5, so about 500,000 will come from Japan or other areas. So we`re predominantly a North American company these days.

CHARLIE ROSE: Let me, just talk about technology.


CHARLIE ROSE: More and more technology is pouring into cars. We all know that. And we`re talking about autonomous driving. Give me a sense of the landscape of that, because we also know that at least I think it would be 50 percent of deaths on the highway are caused by distractions.

JIM LENTZ: It`s huge. It`s huge today.

CHARLIE ROSE: Is it a big number like that.

JIM LENTZ: Yeah. I think it`s pretty close to that. So autonomous driving is kind of the Holy Grail, because the goal, eventually, is to develop cars such that they cannot be involved in an accident. Now obviously that`s going to take some time. And we feel that it`s going to evolve. So we think the first step along the way is what we call guardian angel. And that`s where you are still driving your car. You have control of your car.