Carvana Gets Suspended and Soars at the Same Time, Porsche Considers Google, Celebrity Ads

January 12, 2023
It’s Thursday folks and today we’re talking about Carvana’s surrender of their dealer license in Michigan. We also cover Porsche and Google’s talks, a follow up of our EV charger story yesterday, as well as a new AI written celebrity ad.
Listen On
  • The Carvana location in Michigan will be surrendering it’s dealer license and ineligible to apply for a new one as part of a plea deal with state regulators
  • Originally suspended on Oct 7, which Carvana contested, but lost the appeal
  • The Michigan Department of State had said Carvana violated the Michigan Vehicle Code by:
  • failing to apply for title and registration within 15 days of delivery
  • failing to maintain odometer records
  • improperly issuing temporary registrations
  • failing to have records available for inspection
  • "In a plea deal signed with our department, the Carvana dealership in Novi agreed it had violated the law and to have its dealer license revoked and be barred from reapplying for a new license for three years," Department of State spokesman Jake Rollow wrote in a statement provided to Automotive News.
  • Customers will still be able to buy a vehicle online and take delivery at the location, but will be unable to walk up and talk to or work with a salesperson
  • Carvana shares were up 25% yesterday as they are getting swept in the meme stock category


  • In one of it’s first pieces of intriguing news since going public late last year, Porsche is in talks with Google to fully integrate its operating system into its vehicles according to a source close to the matter
  • Porsche had been hesitant to make the move due to Google asking for too much data to be shared, according to Manager Magazine, which first reported the talks
  • GM, Ford, Nissan, and Renault
  • In a follow up story from yesterday's conversation with Todd Caputo regarding S&P Global Mobilities report on the number of chargers the US will need to sustain EV growth by the year 2030, the largest power grid in the US reported that they saw 25% of their grid fail during the Christmas break
  • PJM Interconnection, a regional power grid that stretches from Illinois to New Jersey services over 65M customer said their grid was on the verge of rolling blackouts due to the cold snap
  • Todd’s point was that the number of chargers doesn’t matter if the grid can’t supply the power reliably
  • ChatGPT, the AI powered chat generator that has been making headlines is the star in a new commercial created by actor Ryan Reynolds for his mobile service company Mint Mobile. In the ad he gives GPT some direction and then reads the copy out loud
  • Reynolds called the ad “eerie” and “m

Get the Daily Push Back email at https://www.asotu.com/

JOIN the conversation on LinkedIn at: https://www.linkedin.com/company/asotu/

Read our most recent email at: https://www.asotu.com/media/push-back-email

Share your positive dealer stories: https://www.asotu.com/positivity

ASOTU Instagram: https://www.instagram.com/automotivestateoftheunion

SPEAKERS

Kyle Mountsier, Paul Daly, ryan reynolds


Paul Daly  00:27

Yo, and that insurance company hype got a fun show today. So good to be back in the studio for crying out loud Carvana got this, Porsche, Google celebrity ads and anything else we can think of?


Kyle Mountsier  00:45

Yes. Repeat. I'm telling you what. I don't know if y'all talked about it on the show yesterday.


Paul Daly  00:51

We did. I already know what you're gonna say yesterday


Kyle Mountsier  00:53

was a full basket case at the old airport. Just like let me lean in just read everybody's story, man, we're at the airport. And you know, normally like one or two flights are getting delayed. Everything's, you know, like, okay, I get this. Literally every flight. I in the country, like 1600 flights for two hours yesterday get delayed. And I'm telling you, you want to you want to see a whole slew of flights get delayed and watch how quickly an airport can fill up. People are like sardines in a can. That's


Paul Daly  01:27

exactly what I was thinking of. Because like the inflow stuff doesn't stop. Right, but the outflow stops. And I could only think of like Lucille Ball, and I Love Lucy show and all the chocolates are coming down. Like I was like, where are all these people? Just all I could think I was like, the airport is like that seed. Right now. A couple Fortunately, you got home, it feels so good to be doing a show back in the studio, where we're both settled. And we both had a minute to calibrate. In the morning. I'm wearing I feel extra special today because I'm working


Kyle Mountsier  01:55

to you. This is the hat time hat and from Tampa a couple years ago,


Paul Daly  02:00

we had that event and had every This is my this is your names up here somewhere. I can't remember where it is. This is this is really my prized possession, I should put it in a glass case and light it because this is one of the favorite things that I own. Like if there was a fire, I would want to make sure I save this. You know, I'm saying I can't replace it can't replace it. Oh, we have a lot of fun stuff to talk about. We had a fun time at the 20 group in Phoenix with the NCM 20. A bunch of marketers that always gets us fired up. We're going to Baltimore on Tuesday to check out the venue for a solo con, which is gonna be the last week of September circle that week on your calendar right now because we want you to join us there. And then of course, the countdown to nada begins next week,


Kyle Mountsier  02:37

too. It's only two weeks away from today. I know. Let's go everybody oh my gosh, it is any marketing director of industry partners just like scrambled at their desk listening to this.


Paul Daly  02:49

Recording, Brian, good to see you in the live stream all of you on the live stream. It's good to be with you if you're on the audio podcast. Thank you so much for tuning in, we were able to meet a bunch of listeners last week. And it's fun to let let hear what like how they watch the show or how they listen to the show. And we realized a lot of people are not cross pollinated. That means you listen to the podcast, but you don't get the daily email, but you aren't part of the LinkedIn community. So if you're not one of those, follow us on LinkedIn at asoto. Check out our daily email. It is so much fun and look some days you can read it some days you can't read it. But if when you do read it we promise will make you smile and laugh just a little bit. And one of our listeners said like I'd sometimes skip the intro so I can get right to the news. So


Kyle Mountsier  03:30

getting to the news, right?


Paul Daly  03:32

Wrong once all right, getting right to the news. Here we go. The Carvana location in Michigan will be surrendering its dealer license, what is their ceremony about that? Is it like you know, the walk of shame up to the office, just like this. Imagine that in my head. You know, like when one one general surrenders to another general everybody lines up, but because they're ineligible, they'll be ineligible to apply for a new one for three years in a play date in a plea deal with state regulators. Originally, the license was suspended on October 7, which Carvana contested but they were denied their you know their appeal. The Michigan Department of State, you said Carvana violated state code by failing to apply for title and registration within 15 days of delivery, failing to maintain odometer records and properly issuing temp registrations and failing to have written records available for inspection. So a couple things. And here's a quote from the automotive news article it says automotive news and a plea deal signed with our department Carvanha dealership in Novi, this is in Michigan again agreed to have violated the law and they have its dealer license revoked and barred from reapplying for three years said state spokesman Jake Rollo. So customers here's the deal. Customers can still buy a car if they live in Michigan, but they have to only use online. They can still take delivery at the Carvana location, but they cannot walk up and like start working to deal they can't walk up and ask questions about anything with sales. People that's a big no, no. So it'd be interesting to see how that plays


Kyle Mountsier  05:02

crazy part here is like, the reason why you do online is to speed up your purchase process. So now every single one of these people have to go personally to the DMV to get their vehicle registered. Because Carvanha can't actually complete the registration process for them. They are now doing this seamless or close to seamless process online buying the car and then like you're at the DMV. brutal, brutal. Oh, gosh, you know, that is like that.


Paul Daly  05:33

I'm a local dealer, all of a sudden, I'm talking about. You don't want to go to the DMV, do you?


Kyle Mountsier  05:38

Yeah, without a doubt, you're just leaning into that conversation, you know, making sure that it's like, we're going to care for you long after you purchase a vehicle from us. It's it's a perfect conversation. You know, this is, it's interesting, because there's always going to be scrutiny on larger players in the market. This is something that like even local dealerships, from time to time, have trouble with maybe changing title, clerk changing title for works. EMV paperwork is a little slow lending, whatever it may be. And so I think this is just a reminder that, like, if customers are frustrated after the purchase, they will tell someone, and that someone is typically someone in a legal, you know, perspective that has a legal perspective. And at this point is the DMV or the state. And boom, all of a sudden customer perception impacts your ability to deliver vehicles. So just a reminder that franchise dealers that you know, the sale ain't done when the sale is done. Gosh, imagine having a good experience like buying the Carvana thing online, having your car delivered get all excited. And the last thing you remember about the whole transaction is your hour and a half in the DMV trying to register an out of state vehicle in your state.


Paul Daly  06:45

Tough. Does that mean you have to pay the sales tax at that point, too? No, no, no, no, no, no, that you're that they can figure that out? Yeah. Either way, it's not easy. It's not complicated. You know, interesting timing, we were just in Phoenix. And we were adding In and Out Burger. And from the In and Out Burger, we could see the Carvana vending machine, the empty Carvanha vending machine, it had like two cars in it. And then I didn't get to tell you this. But as I was driving to the airport, like I passed the Carvanha headquarters, and it was dark, it was in the morning. And I was just kind of thinking of like, all the things that are kind of converging right now for Carvanha. Yesterday, however, their stock did jump by 25% to over $5 a share. You know why? I was like, I was like, Are these two things related? This morning, when I was looking at the story, I'm like they couldn't have affected the stock price that that big of a deal. And then now it's apparently gotten swept into the mean stock craze now hanging out with AMC and Bed Bath and Beyond. So I don't know, invest at your own risk, I guess. Yeah, you know, it's really you know, and if you don't know, you probably know what a meme stock is when, like a subreddit or group of people get together and say, Hey, we're gonna buy this stock and kind of, you know, squeeze it officially inflate, but it has 00 to do with any substantive business change. So, you know, that's speaking of a substantive business bit of his news change. Something we've been following a little bit. And Kyle has a lot of opinions on this one, I think good opinions too good opinions in one of its first pieces of intriguing news since portion went public late last year, we covered that is they're in serious talks with Google to fully integrate Google's operating system to kind of take control of the cockpit in the Porsche vehicles, they had been hesitant to make the move previously, because, you know, it means a lot of data is going to Google. And you know, they're trying to work out the details of that. But you know, they're apparently in advanced talks to make that happen to join, you know, Ford, GM, Nissan Renault, who have already made the move. So I mean, Kyle, you like you'd like this?


Kyle Mountsier  08:44

Yes, I absolutely like it, for me the data I, I get the potential concern. But if you're going to be sharing data with anyone, it's the person that probably already has 99% of it, they're just getting their extra 1% from you. And, and, and so for me, like, I don't care if you're an Apple or Google or Android user, you the benefits of having a Google operating system in a vehicle are much better than any other infotainment system. And it allows Porsche to focus on the things that they should be focusing on. So I think kudos to having the conversation, I hope more manufacturers pay attention to that. And I'm excited to see what a luxury manufacturer can do with that entertainment experience. And really, you know, from a hardware perspective, support the software experience, because, you know, the hardware the the way it actually presents itself is also important. It's not just like putting the software behind it. So yeah, I think Porsche is going to do a good job at it, and two


Paul Daly  09:39

thumbs up from comments here. So let's give a thumbs up. Hey, for those of you leaving comments in the chat, I am so disappointed that it's like a couple of minutes behind in the streaming platform because on LinkedIn, it's lightened up to eight people, offering advice to Carvana offer free double doubles. Try talking about the email. It's just it's just a lot of fun in the comments, and some They will figure out how Kyle and I can be in the comments in real time, so that we can respond to those not too up to maybe I don't know, maybe like YouTube is more, you know, maybe LinkedIn is just slow. They're a little slow.


Kyle Mountsier  10:09

So I have I have a question is like, you know, is an Eevee like protein style? And like, a gas vehicle is like, Animals Animal.


Paul Daly  10:19

You know, in and out, you know what I mean? If you don't you have no idea what we're talking about. But if you know, you know, I'm trying to think of a segue because this is our first like, follow up from a conversation. So yesterday we had longtime second generation dealer turned consultant turn savant, Todd Caputo on the show. He's been a guest host. You'll probably see him some more in upcoming episodes. But we talked about the s&p mobilities report of how many Evie chargers will we need by the year 2018. How many will we need by the year 2030. And it ended up being like two point something million and I was like, Look, we can charge this all over the place, right? Yeah. But if there's no power to the chargers, what does it matter because he lives in North Carolina, he said, we got a cold and we ran out of power, right, like, and so a little chilly. And so and he sent me an article late last night, just be like, Hey, this is what I was talking about on the show this morning. And a new a new report came out that the largest power grid in the country, which is happens to be in the Northeast sell 25% of their grid fail. During Christmas break. Now it was on the brink of like some serious stuff where there starts to be blackouts. But PJM interconnection, they stretch from Illinois to New Jersey service. 65 million customers said it was on the verge blackout string, just because it was cold during Christmas, you know? And so I think just a little context to yesterday's thing. Yeah, it's another challenge. We're gonna have to solve in the midst of this Evie craze where it's like, yeah,


Kyle Mountsier  11:53

and I still try and like relate that to what we've dealt with in oil. And every once in a while we'll we will see oil constraints due to, you know, the inability to travel the Mississippi like that happens, we and then all of a sudden, oil is constrained and gas is constrained. And all of a sudden, we can't get gas into into, you know, so we saw a lot of that actually, like a year and a half ago, I remember like only one place in my city had gas left, right. And so remember that we've seen this before, it's but the volume of customers affected like to say that 65 million customers on the grid, were let down. In this northeast, there was nothing like that type of volume impacted by like a gas or oil. So it is it's a wild thing to think


Paul Daly  12:40

like different to you can't truck in electricity.


Kyle Mountsier  12:45

You can't just fly right whales coming from


Paul Daly  12:47

every coast from the south, from the north, from the east to the west of the oceans. I mean, electricity goes down. I mean, it's a real, it's a real challenge. I


Kyle Mountsier  12:55

this is where I think I mean, we're gonna have to get a lot better and we're gonna have to have a lot lighter solar power out there. Because you're storing energy. And not worrying about how the grid is dealing with weather conditions is gonna be really,


Paul Daly  13:09

really battery factories. I don't know I think we're I think we're in for a wild ride. A lot of talk of hydrogen upswing, I guess on top of hydrogen up talk in hybrids, and we shouldn't be


Kyle Mountsier  13:19

hanging out. I'm hanging out with BMW and Toyota. Oh, is there like African all level headed?


Paul Daly  13:25

Todd said yesterday he goes, you'd be an idiot to ever bet against Toyota. All right, this last story is really fun. We have a little video for you to watch gift sensitive ears. There's one curse word in the beginning of it. So you'll be okay. So check GBT, we talked about it a lot. It's the AI powered chat generator that's been making headlines. So now Chet GPT is the star of a new commercial created by actor Ryan Reynolds. You know who he is, you know, he's dancing with Will Ferrell Oh, Christmas long, and all this other stuff. For his mobile service company, mint, mobile, and the in the ad. It's a lot of fun. We're about to play it. He gives Chet GPT a little direction on how to write an ad and then reads the ad and reacts to it. So all right, go ahead. Jen, roll this Ryan Reynolds owner mint


ryan reynolds  14:10

mobile. You know, we're always looking for ways to save you money. So this year, we're kicking things off with an ad that I created using chat GPT the AI technology. This is what I asked it to write I said I said write a commercial for mint mobile in the voice of Brian Reynolds. Use a joke, a curse word and let people know that men's holiday promo is still going even after the big wireless companies have ended. There's already a great commercial. Hey, it's Ryan Reynolds can amazing hearing. First of all, let me just say mint mobile is the shit. But here's the thing. All the big wireless companies out there are ending their holiday promos, but not mint mobile. We're keeping the party going because we're just that damn good. Give mint mobile a try. And hey, as an added bonus, if you sign up now you'll get to hear my voice every time you call customer service. Just kidding. That's That's not really a thing. Stay classy, everyone that is mildly terrifying but compelling.


Paul Daly  15:09

That is a great 62nd ad.


Kyle Mountsier  15:11

This is why the ad is so good is because it, it tells the story twice. It uses the this, this AI to to not add the human element, but add the like the interesting element. And I think that's what's important. Like as we learn about what how I can support what we're doing is like don't use it to replace the human element, use it to enhance it or make fun of it or, or or start the idea, ideation process or whatever it is. And this was just like, a quintessentially perfect execution on a nutrient.


Paul Daly  15:47

I couldn't agree any more. And you know what? That's going to run so much better on OTT on everything doesn't matter to me on youtube pre roll like this, like your social media, right? Like the end of network, the end of network television, we're here and Gary Vaynerchuk talks about this, like, hey, what's it gonna look like? It's gonna look a lot more like that. It's gonna look a lot more. There you go. We gave you a little tour around the things that fly around our brains on a Thursday morning. We help you get out there. serve one another. Make you have a little fun, too. It's okay to have fun. Right? Let's go have fun.

Get the daily email that makes reading the news actually enjoyable. Stay informed and entertained, for free.