Extinction-Level Event, Craigslist Markup, Get A Free Donut

Paul J Daly: 0:16

coming in and out on a Monday last week of February dealers rejoice everywhere. We have an extra day. It's a leap year. So we're going to talk about an extinction level event Craigslist markups and getting free doughnuts. From Krispy Kreme. Yeah, I go to the people really want to know. I just realized it was a leap year this weekend.

‍Kyle Mountsier: 0:35

Really?

Paul J Daly: 0:37

Because I can't remember why my kids were talking about I was like, 29 we have a 20. Oh, because 21 pilots is releasing something special on the LEAP here.

Kyle Mountsier: 0:44

That net that is so on brand. So on literally been planning this since the last Leap Year and why not? Yeah, that's what you have unreal.

Paul J Daly: 0:54

It's unreal. But yeah, I mean, I was like, an extra sales day in February. This should be a great February for

Kyle Mountsier: 0:59

it. Yeah. And not just that, but like, from a and I haven't I, you know, I need to check in with a few dealers this week. But and, you know, there's been like mixed sentiment in the start of the year. January was a little Oh, for sure. But February from a weather perspective, like, I don't see a ton of like weather issues out there in Ohio because there hadn't been. There haven't been especially if there's no like nine foot stomp on buffalo. Oh, that

Paul J Daly: 1:29

happened early here. No, but for real. We've had very little snow comparatively. I saw some articles about there being like one of the least snowiest years on record. And even like the big nor'easter storms that have come up. Yeah, so February. Granted, it all balances out right, you have like a lower tax season than last year, an extra day in this month, I don't know. I think the one thing is certain is like we never really know what's going to happen, we just take the best of what we have.

Kyle Mountsier: 1:53

That's it that's making the best of what we have. Speaking of what we have is a soda con coming up in goodness 78

Paul J Daly: 2:03

We crossed the 80 day threshold.

Kyle Mountsier: 2:06

There's only a little over what 20 days left with the initial troublemaker discount the lowest prices at all this year on tickets period. And the story will end on March 14. So make sure you get your tickets now. Tickets are starting to roll. It's like speakers are starting to come in. The tickets are starting to roll the sponsors are coming a part of it. It's a landed like

Paul J Daly: 2:31

you awesome panels we've yet to announce. I know. But

Kyle Mountsier: 2:35

I feel like it's gonna be the week of like announcing some panels. I can feel it. I can feel I agree.

Paul J Daly: 2:40

I agree with trying to put a few together too. And some some really neat kind of emerging brands. And we'll talk about it at some point. But well, Canada's having a breakfast, Maryland auto dealers is running their annual meeting in conjunction with a soda con, we just announced that late last week. And so that's just going on, hey, I saw quote this morning from Simon Sinek I get this email from him. puts little quotes today just seems so applicable to ASOTU CON and to what we believe here, just in general with the more than cars mentality, Simon Sinek says this relationships are the foundation of accomplishment. And if that doesn't sum up why auto dealers are so successful, I don't know what does. Oh,

Kyle Mountsier: 3:21

that's a man, you could go on that one for

Paul J Daly: 3:24

a minute. As I preach, as they say, That'll preach, That'll preach. I mean, like, there is a big difference between, you know, learning, education, insights, etc. But in the end, like that will never get you that might get you some wins. But I don't think I like the way he uses the word accomplishment. Right? That's a lot of wins strung together in the midst of a lot of losses in the midst of a lot of reasons to need to lean on your the people on your left and on your right. Which is another way to say relationship.

Kyle Mountsier: 3:54

Yep. Yeah, it's like that old like, you know, show me your 10 closest friends. And I'll tell you what, where you'll be in 10 years or so. It's just it's the same type of thing. It's like who do you surround yourself with on a on a regular basis and watch where you're headed? Based on I

Paul J Daly: 4:09

think it's time for me to drop that one on miles, my 17 year old son. He's a really responsible kid, but it's like that's a good one, right? Because I looked at some of his friends and like that's where you really want to spend time with that kid. Definitely. Great. What else is that? Is it time for news? Yep. All right. All right. He got a big one right. We had a big extinction level event. That's a phrase right, and a unified stance against some major auto disruption a bipartisan group of lawmakers are advocating for Joe Biden to halt imports of low cost Chinese autos from Mexico or EVs specifically fearing a catastrophic event on the domestic auto industry. This is also in conjunction with the Alliance for American manufacturing, turning up the pressure saying like, Hey, this is literally and they use the term extinction level threat. Chinese vehicles obviously better fit from a strong government subsidy from the Chinese government and are in position to exploit some North American trade free trade agreements, ie making cars in Mexico trying to bring them from Mexico to the US. China's BYD is obviously the largest target for this, this movement and legislation as they're setting up that Evie factory in Mexico. Right now, the import tariff on an Eevee or for vehicle is 27%. already. Oh, they want to make sure that that gets tacked on to the ones coming across the border of Mexico also. Right, right. Right, you increase that here's a quote from the Alliance for American manufacturing says the commercial back door left open to Chinese auto imports should be shut before it causes mass plant closures and job losses in the US.

Kyle Mountsier: 5:50

Here I got I got mixed feelings on this one. I love a manual American manufacturing, but I also like amazing competition. And so you know, again, mixed feelings. There's a lot of US manufacturers, there's a lot of overseas manufacturers that are making vehicles in in Mexico and have been utilizing that resource in North America to make manufacturing and shipping easier. So it would impact I'm sure, not just Chinese vehicles, but a lot. Oh, without a doubt, right. That's what's scary to me. competent, right. And like,

Paul J Daly: 6:27

there is also like, the premise of free trade agreements are inherently supporting, like a level playing field. Right? And if there's so much government subsidy going into every car, right, it's I mean, like, let's be honest, that's kind of what the US is doing with the Evie market in general. Right, right. Government to create artificial demand. And this is just like that on steroids. But from like, not a domestic, you know, sources from an international obviously a very contentious relationship with points so I don't know we'll see what happens

Kyle Mountsier: 6:56

is why the President's at the Big Three have all been just saying hey, we have to get it right we have to get manufacturing right we have to get costs in order we have to understand the Evie market, we have to understand, you know, the current gas market and and make sure that we're set up because these it's it's inevitable that they're coming, how they come in when they come in, and the speed at which the inventory comes from the manufacturers is still a question to be had. But it's still inevitable. Right? And it's probably even with whatever tariffs get imposed, we'll still have like a significantly lower cost. Yeah.

Paul J Daly: 7:35

So Well, speaking of things that are inevitable this is as inevitable is rain in the springtime Dallas area's Lexus dealership may be jumping the gun with a markup on a not even yet released or received 2024 GX model move it's getting some attention, reviving the conversation that just started to fizzle out about new vehicle markups before its arrival. An unknown Lexus dealer maybe this is just a rote we're gonna put this out there. Maybe it's just a rogue employee or a sales manager seeing what we're actually doing cars rule a little, little Oh, yeah, hashtag cars rule. In Dallas, somebody posted a marked up 2024 GX, it's the new like, kind of Lexus Landcruiser at $27,000. Over MSRP posted on Craigslist, the vehicle starting price MSRP starting price is 77. Two, it's listed at 105 105,000. You know, the high demand this this look great. That's a very in demand truck. They're going to start to be released, it's not likely to be the last markup we see. The writer of the Jalopnik article is named Lawrence Hodge. He says Don't indulge this. Don't even pay $1 over sticker Wait, or don't buy one at all. Right? There's an element of just free market capitalism. Like if somebody wants the car and it's worth 105 to them. And that's the only one there are you're defrauding somebody I, you and I are, are very I don't know, we fall in the same line when it's like the dealers that did not charge over MSRP are doing really, really well right now. And on the back end of all that at the same for these like, I don't know, these vehicles, that's where

Kyle Mountsier: 9:14

I land. I'm right in the middle. Look, if you have a mass market vehicle with inventory, or even like potential future inventory volumes and like should hit a mass market that isn't a unique or specialized vehicle. Don't mess around with customers. You'll pay for it later. Right? Yeah, but if you have a super unique vehicle that can't be found anywhere else, as IE, Nissan GTR 100 made a year whatever the number right or anything that has a very, very small inventory. It look when people have been creating demand out of inventory and price, you know, price flexibility on products for years and years. And that should continue. I just contend that Like if you've got a mass market vehicle that will see a lot of inventory, you are doing a disservice to the dealership and the customers in like over overstated markups, it's crazy. There's

Paul J Daly: 10:14

an element to thinking about this a little bit more. And if you're a Lexus dealer in a busy Metro like Dallas, selling this vehicle at a high dollar amount, and maybe you get another 10 or 15,000, for it to someone outside of market, I think is a bad long term play because there's a consumer inside your market that is going to be a service customer and a loyal customer that really wants that vehicle and if you know if you're not going to get a lot of them you have a chance to make someone real special. I don't know. There's no right answer, Kyle. I think that's the bottom line.

Kyle Mountsier: 10:45

There's no right answer.

Paul J Daly: 10:46

The laws are in place. Follow the laws number one once that's the case, there's there's more than one way to make this a dealership thing work.

Kyle Mountsier: 10:55

Always, always more than one way.

Paul J Daly: 10:58

Speaking of things that don't work, didn't work. Didn't work. So then they really did work.

Kyle Mountsier: 11:05

If you weren't paying attention on Thursday, I don't know where you were at but AT and T had a little bit of an issue. So in a creative twist, Krispy Kreme turned that nationwide cell phone outage into an opportunity to earn a little goodwill as they offered free donuts as a sweet relief to disconnected Americans. They offered free original glazed doughnuts during the major AT and T cell phone outage with no purchase necessary. They announced it on Facebook. And they invited customers to you know what they did, they said look for the hot light. The offer was a sweet relief for customers. A Krispy Kreme representative commented, underlining the brand's effort to spread positivity during challenging times. I mean, they're not that challenging of times, although I did have some friends freaking out. But at the same time, like taking a cultural moment. And moving into a brand play.

Paul J Daly: 11:57

We talked about it whenever we can. I don't know if we've ever talked about. Yeah, yeah, sounds familiar. It'd be funny like maybe one day AI will allow us to search that like over the last hundreds of episodes. How many times do we say that exact phrase, take a cultural moment pivoted into a brand play. I think I love it. I mean, everyone loves Krispy Kreme. Well, you know, especially heart surgeons they love Krispy Kreme right keeps them in business. But but but this is like a really simple deployment. They probably didn't give away a lot of free doughnuts, right? They took the scan a lot of free press on it really and the fact that you as an auto dealer in the community, your people are in touch with the needs you all know all the little nuance things that happen. It's just a great it's a great something to talk about. I think it is a great something

Kyle Mountsier: 12:43

to talk about. I mean if I was running a business that had free Wi Fi that day, I'd be just all over it. I'd be like out of a TNT gets free Wi Fi Oh,

Paul J Daly: 12:52

I'm sure I'm sure some people Yeah, especially at a dealership you have good stuff. All right, here we are last week of February leave a few days left. It's a leap year so you have a little progress to make. Remember, relationships are the foundation of success, relationships, or accomplishment. Let's go accomplish something

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