Recapping True Journalism and Future Forecasting 

Paul J Daly: 0:28

Wednesday, December 27, well on the way to our last week of the year, but today, we're bringing you a segment. Jamie butters. Steve Greenfield, Daniel, go there. We hope you're ready for this one. The people really want to know who that is and who Id they stopped

‍Kyle Mountsier: 0:44

segments on point.

Paul J Daly: 0:45

I'm pretty I'm pretty sure none of these people were together until we had them on this segment last week here an extravaganza

Kyle Mountsier: 0:52

that would be you know, that would be an interesting study, like, how many net new panels can we create that have never sat on panels together? Probably a lot. I mean, you started way back in the day, like having competing,

Paul J Daly: 1:07

Jim Fitzpatrick and Jason Stein. That's the one that definitely got the most buzz. And they're like, Wait, who? Well, but we were all locked down. Everybody had to get along. I mean, they're both professionals. And we did have a conversation. But yeah, no, that's isn't that the magic? Right? It is the man putting together new ingredients and be like, Oh, these two things. It's why shark coterie board is so great.

Kyle Mountsier: 1:28

Yep. You know, I used to like we both have historically done podcasts and done events where like, it's a single person talking. And or it's like a single interview, which are great, right, because you get that one person's perspective. But it's always more fun, whether it's Auto Collabs, or whether it's in ASOTU CON stage or the year and extravaganza when you have these different voices kind of like speaking in on a similar topic, because a lot of times you get alignment, but sometimes you get a different angle, right, like all the time if a prospective way to see it. And I think that broadens the horizon for us, instead of just like, expecting that the person on the other side of the audio is just the right one.

Paul J Daly: 2:07

I mean, I can't tell you how many times we've seen where you want literally watch or hear one guests say like, I I'm gonna call you about that, because we're trying to do the same thing. And then we know in the back channel that actually happened and actually got deployed, which

Kyle Mountsier: 2:24

at ASOTU CON first year you had Brian benstock changing his mind. I had I had Rick Reichert thinking about what Dan banister was doing this year on on no doubt agents, so it's

Paul J Daly: 2:34

hard to do that in your service retention rates, like 90%. I think everyone was like, yeah, what are you?

Kyle Mountsier: 2:42

What are you doing over

Paul J Daly: 2:44

$100 bills, I don't know. But today, so we're going to share this with you from our urine extravaganza. If you haven't seen the whole thing. You go to our YouTube channel and see it ASOTU dot B E A so tube for those of you keeping track. And here it is. Here's a Jamie, Steve and Daniel. All this is so much fun. Daniel, Jamie, Steve, thank you for giving us some time this week before Christmas. Glad to be here, guys. I knew I was hoping I could get everybody to say something right at the same time. Okay, so this year, obviously, we've had so many things go on. But it is hard to avoid all of the drama and all of the conversation and uncertainty around the UAW strike. Jamie, I remember a conversation is I think one of the first conversations we ever had was at David Kane's event much earlier in the year. And one of the questions that came from the audience after your after your talk was, what should we be thinking about that we're not thinking about right now? And you aptly said, I don't hear anybody talking about a strike. But it's likely there's going to be some fanfare around that. So you are watching this way far in advance, then you've kind of like, navigated us all through it. Everybody was, you know, tied to automotive news every morning. What's the update? On this side of it? How did it play out based on how you thought it was going to play out?

Jamie Butters: 4:02

Well, certainly Shan Fein has was been very unpredictable character, right. And it was sort of fundamental to His strategy was to be unpredictable to the automakers. So I can't claim that I saw this all playing out exactly as it did. You know, certainly, the reason I felt so confident that there would be a strike isn't because because I have some, you know, divine power other than I have this great army of intelligence gathers that work for me and share their insights. So I was definitely leaning on Michael Martinez. His reporting and his insight, you know, and it kind of did seem obvious in and I think it did play out as we expected, in that, you know, this union was really reeling and trying to get back on its feet they'd had a really massive scandal. Sean fain won a very narrow and thinly attended election. He had no base, he had no machine, he had no mandate. And so he did all these sorts of stunts and this public media, public relations campaign through Facebook Live and whatnot, to build his own credibility to try to rebuild some of the culture within the UAW and rally people around, uh, you know, the common effort. And then he did it the way he did it. And, you know, it was costly to the industry, but arguably not as costly as it could have been. And, and workers got really big raises.

Kyle Mountsier: 5:36

Yeah. Now, Daniel, you obviously as as on the dealer side, you know, working with manufacturers that were directly were not directly impacted, you know, there was a variance in in dealers that were directly impacted, because the manufacturers were a part of the negotiations and those that were not, you've gotten the chance through the wheelhouse podcast to kind of talk to a lot of people through that. What's been the sentiment of how it's actually impacted dealers on the ground? And what are dealers experiencing as a result of the UAW strikes?

Daniel Govaer: 6:08

Yeah, good question. I think the best thing was when actually I had Patrick Gabbard on the show, and as you know, he runs a massive Toyota store, and I asked him the same question like, this doesn't look like it's gonna directly affect you. And he's still an opportunity for me, I'll tell you exactly what I would say, at our store, I was at a store that is directly affected, when I'm talking to the client, right? When I'm actually at the point of, at the point of actual contact with the client, I'll tell them, this may affect us in some way or another, but I promise, my commitment to you is, it will never affect you. And he probably said it better than than that. And that was a good learning opportunity for a lot of people to adapt what they were thinking their client contact would be. And for a lot of us, too, it was a good opportunity to understand what the union was going through was essentially because they hadn't had any updates, right, in a decade or so there wasn't, you know, the way that they were compensating the way that they were looking at their compensation hadn't changed. And so then they had to do a whole lot all at once very, you know, somewhat violently rocking the boat. And so had we, in a shorter period of time, in less than 10 years, have we had the opportunity to look at ourselves and change how we're compensating or how we're taking care of our people so that it's not necessarily a strike, but very much so in the sense where we could have that Area of Difficulty internally as well in our industry, what do we take this opportunity and look and see what things can we change? What things are we past due on looking at so we don't have to try and change so much all at once. Overall, from the rest of the dealer side, I really didn't run into really any, any strong feelings of being disadvantaged by by the strike at all. Wow, that's

Paul J Daly: 7:38

impressive now, so that's kind of like boots on the ground, frontline. Steve, you get to play in a space that is always kind of looking over the horizon. And tying it back to what the needs are. Did you see any commerce here any conversation or see any motion at all in, like the tech space in the conversations that you have about what's over the horizon that considered the strike as anything more than a speed bump?

Steve Greenfield: 8:02

Well, I think I mean, time will tell, I think, you know, this is gonna be the classic definition of a Pyrrhic victory, meaning that, you know, you win the battle, but you lose the war. And I don't know what Jamie's thought on this is, as I thought it thought it out. And there may be an ecosystem of startups that benefit from all this collateral damage that's caused, but you know, the the UAW seems to be continuing to want to now penetrate some of the import manufacturers. And I think that the the dynamics, I would say, are three that I worry about one being the legacy automakers that are trying to figure out the timing to make this transition to EVs are bleeding cash and their Evie operations. And I think indefinitely, will continue to do so. Number two is that's going to be compounded by the fact that Elon Musk and Tesla are more profitable from a gross margin than any of the other automakers. And as a result of that, except maybe like Ferrari, and Porsche, and as a result of that, he's going to continue to squeeze their Evie operations and continue to ensure that they believe by dropping prices, and continue to find, you know, efficiencies in production. And then the last thing that will compound things even more and make it more painful, is that I think it's inevitable that the Chinese are going to bring product into the US market. You've seen even this week, some talk about sort of backdoor in through the Mexican market. And I think, you know, the squeezes on for the legacy automakers and their Evie operations specifically, and having inflated, you know, labor costs isn't going to help that at all. So I think, you know, 510 years from now, we'll look back at this UAW, you know, big victory as being maybe the first piece of the puzzle, that's going to bode very, very poorly, I think, for the economics and the industry, above the dealer level, I don't know, to Daniels point that it's ever going to kind of get down to the dealer level. But I think from a legacy OEMs I'm looking at this and scratching my head and saying, what's our profitability going to look like for the next few years? Because all of these headwinds are mounting.

Kyle Mountsier: 9:55

Right? Yeah. Jamie, actually, just this week, you know, there was an article All about the fact that the UAW is continuing to pursue relationships with the manufacturers that do not currently have unions in them. And particularly to Steve's point, like this is not going to be a dead conversation, we're going to be continuing to talk about this as an industry and the impact that it might have on the dealer or the consumer or the legacy OEMs ability to compete in a new market. How do you see that playing out as we head into 2024? If you had your crystal ball like we all we all thought you had back early 2023. How do you see some of these conversations playing out?

Jamie Butters: 10:36

I'm still stuck on the idea of pursuing relations with these other automakers because the you know, as Ford how they feel about their relations with the UAW and right, they used to Ford, you know, Bill Ford especially felt a real, you know, bond with UAW felt that they were they were together to take on the Tesla's and the Toyotas and Shawn Fein is like, we're not your partner, man. You're the enemy. We're against you. The Toyota and Tesla are going to be our next enemies, but their workers are, you know, our brothers and sisters of the of the factory. So, yeah, they, Shawn fain just went down to Chattanooga, or I think he was in Chattanooga, he was dealing with, you know, to tell Volkswagen, you know, stand down and let us organize these workers and like, Hey, we're not doing anything wrong. So it's a contentious relationship. Chattanooga has a chance, you know, that one was really close, even when the UAW was being, you know, rocked by scandal headlines on the regular. So they seem to have a chance there. I don't know Toyota and Honda, have had so many decades of relationships with their employees directly. Then you see the raises that are being given out by the non union automakers, they want to keep the union out and make it fighting for what yeah, why do you want to pay dues to somebody in Detroit, who will tell you when you can and can't work? We'll just pay you what's fair. Get you close enough to that, and let's leave the union out of it. You know, I, I worry as well, like you said, Steve, about the the cost of labor going up so much, you know, but one thing back when the harbor report was still published, and I'm dating myself, because I don't think they'd been making this public for a decade and a half, probably. But we were seeing the average amount of labor hours per vehicle come down to about 30. So even at $100 an hour, you're talking about $3,000 of labor in a vehicle that now costs $50,000, on average, you know, it's not inconsequential. And whether it's 3000, or it's 2500 makes a big difference for automaker profitability. But it's it's not as devastating as the cost of it's not outside historical norms. Right? Yeah.

Kyle Mountsier: 12:56

Daniel, you are an extreme advocate for employee health, employee advocacy within any organization, specifically, the dealers that you've been a part of? How do you How would you encourage dealers and even the OEMs that you may be partnered with, to look at this situation and approach employees in maybe a new light understanding what the union has pushed these, these OEMs to? Yeah,

Daniel Govaer: 13:23

cuz it's the part that I still don't understand. It's the reason that the this particular strike was so contentious and so costly was because nothing had been done for such a period of time, that's by design, you signed the contract, and then you, you stuck with it, nothing change, you didn't take any additional input, you saw things happening outside your proverbial windows, you could point to a balance sheet and say that there were, you know, look at all these profits that were made, the thing is, nobody was telling you, you couldn't have been a part of that, except for you, you were in a contract, you decided that there weren't going to be things that changed. And so if nothing, I mean, I really do hope it is the little drum that I'm beating on that we do look at this and say that this is we kind of have to inverse this pyramid of you know, where the ideas come from. And it's not that it doesn't narrow at the top, it needs to actually have a very broad base to it. And then that's in the retail world, that's the things that we have to get used to seeing that there. If we are not making changes, if we are saying that, you know, it's at the same time we say that we want to stick to we know it's true, and we know it's good. At the same time. We also say like, well, we don't want to go back to what was and this is, you know, the the what was is in great quotation marks and everybody can paint a different picture of what that was. But the number one thing is, is that we need to start giving the people who are doing the work the platform to how to put together an idea you have a suggestion. You have something that you like and you want more of you have something that you don't like and you want less of you see something that could help us be more efficient, very easy to put in. It takes not much more than effort, but there needs to be a platform for the people that are doing the work to put together their thoughtful expertise and raise that then up into the levels that use that as a guide. enlight as the metric to how they stay truly at the tip of the spear, and at the forefront of the changes that are going to be continuing to come and so that we don't have to continue to have such revolutions of how we take care of our people. And to give a great example, when these other manufacturers do those things. It's like how could anybody that works for a union manufacturer, not think that that's a better way of going about it?

Paul J Daly: 15:21

Like, it's, it was fun, first of all, to be on the other side of the mix, because Daniel, go ver hosts the asoto wheelhouse right show, and it does such a great job. And he's in full control of that show. Right? He has commands press. And so in this, I was like, Oh, I got to ask the questions. Now, Daniel. I was gonna amazing, great insights from all three, right?

Kyle Mountsier: 15:44

No, and not just that, but the the astuteness of Jamie butters just be real about the what he was tracking, who was tracking it, you know, him understanding his team was all over the stories as they were developing. And then to see each of these have a different perspective on how it's impacted the industry because it is it's impacting the industry in a different way for everybody, some, not at all some massive impacts that we're really struggling with parts for some time, and we're seeing that rebound. But it's going to have continued impacts I was the one I wasn't thinking about is where Steve Greenfield was talking about just the the residual impact of the 357 year timeline right as changes in technology changes in these vehicles, all of that and these manufacturers ability to keep up of interest so true.

Paul J Daly: 16:36

And is it just me or does Jamie butters just have an amazing voice? We don't ever get to hear it through the microphone. He's gonna he's gonna be a professional like book reader. It has written three books and I'm gonna listen to them all. Oh, man. Well, here we are. We hope you're having a great Wednesday. We hope he sent you on your way with something to think about something to implement. But right now we all know what everyone in the industry is doing. Closing the year out strong. We will see you tomorrow morning.