Transcript 0:00 [upbeat music] Friday, December 2nd. Roundin' out... 0:04 Well, I don't know if this is the first week of December or not, but we're talking about the FTC won't let Ford be, Tesla's adjustment in price, and kids don't want cash anymore. 0:13 Everywhere I go, the people really wonder. Who I is and ID. Uh, shots fired. I like that. I can't wait till we talk about that. [laughs] They stop and stare when they see me. I'm so ready. Incognito, no need to repeat. 0:20 [laughs] Run up on me, boy, I'll call to your knees. Tip my yay, time for the carrot. Mm. Ayo, beast, we really drill. Yo, today, today is All Things Used Cars- We have the bark, but we have the bite. 0:25 We bring the talk-... talking about aged inventory. 0:27 So if you're watching the live stream right now or you're listening and have the Clubhouse app and didn't get to listen to it, I would pay attention, because everyone that I know that's a car dealer that has used car inventory is going, "Oh, boy-" "What?" 0:42 ... "we got aged inventory." So it's, I think it's gonna be a riveting discussion. I'm excited for it. Yeah, I do too. 0:47 I mean, it kind of pivots off the discussion we had a couple weeks ago when Dale Pollak was on, talking about market pricing. 0:52 Um, so if you don't know how to get to Clubhouse, you can download it on the App Store or Google Play. It's called the Club- Clubhouse app, or just- Yeah... Clubhouse app. Just Clubhouse. It'll be the first one. 1:01 There you go. And then just search All Things Used Cars. It'll pop up. Tap on the button, come into the room, and it's gonna be a lively discussion. Um, yeah. 1:08 That's coming up in, at 9:00 AM Eastern Time today, Friday, December 2nd. Or if you're listening to this later on, you can listen to the replay by doing kind of the same exact thing. 1:17 So, um, you're not out if you can't be there live. It'll be archived and ready for you to listen to. 1:21 We'll try to maybe grab a couple clips, maybe even launch a special Saturday episode of the podcast again- Ooh, a Saturday episode. Thank you... with a couple of those nuggets. Um, couple things. 1:30 U- Year-End Extravaganza's coming in hot. We're starting to get the guest confirmations and the tech confirmations and, and- Mm... the sucker's gonna be fun. It's gonna be a lot of fun. It's gonna be a ton of fun. Yeah. 1:40 It's gonna be a two-hour live stream on December 20th, Tuesday, so even if you can't be there in our, yes, I'm gonna say it, live studio audience, which we will have, um, and you maybe can be in the live studio audience. 1:50 You've gotta go to, uh, the site. Go to asoto.com, scroll down, follow the event on LinkedIn, and just hit us up. We'll see what happens. Uh, but two-hour live stream on LinkedIn, December 20th, Tuesday. 2:01 We're gonna do a year in review, a looking ahead, have a lot of fun, live band. Michael Cirillo will be on the mic too. Man on the street. Yeah, little mic man. It's gonna be great. 2:08 We're gonna do some live appraisals in Nashville. It's gonna be pretty neat. Oh. [laughs] Be fun. Yeah. Yeah, we're gonna make it fun, 'cause why shouldn't it be? 2:14 'Cause it's the car business, and the car business should be fun. Right. Uh, s- [laughs] speaking of not having fun. Stop. Ooh. Segway. Time. Time. It's an opposite segue. I don't know. [laughs] Opposite segue. 2:24 I'm not even gonna finish playing it. 2:25 US senator from Connecticut, Richard Blumenthal, shared his plan to petition the FTC to launch an investigation into Ford's new EV certification program under suspicion that it is violating US franchise laws. Ooh. 2:41 Um- You mean a senator feels like that? Yeah. Let's go. We've moved up, [laughs] we've moved up past the state legislators. They were there too. Right. Um, but we're talking a US senator now. 2:51 In a press conference, he and other Connecticut legislators, along with the Connecticut Automotive Retailers Association... I want... Can you hit a record scratch for me there? Hit a record scratch, 'cause we need it. 3:01 [record scratch] I said the Connecticut Automotive Retailers Association. Retailers. They're talking about car dealers. CARA. They've rebranded. When did this happen? That's amazing. When did that happen? I love it. 3:12 I know. I lo- I saw that, I was like- Hey... "Oh, good, good on you, Connecticut" They listened to Tom Dahl. They did. 3:17 [laughs] They asked, uh, for the, Ford to once again delay their December 2nd deadline, which happens to be today, for opting out of the program. 3:26 Uh, the retailing association co-chair, Jeff Aiosa, told Automotive News, "Dealers look at their sales and service agreements with the manufacturer as a partnership to represent all the brand's products as long as they're in good standing, and to unilaterally change that agreement for a program is patently unfair." 3:41 The senator- Mm... Senator Blumenthal called it egregious treatment, um, and it's, said it's an issue of profound public interest, and he's convinced there's a case that needs to be investigated. 3:50 Ford did respond and said there'd be no extension. They gave them one extension already. They're just like, "That's it. We're done." I guess. We'll see what happens today, I guess. 3:57 And they said, "The voluntary program empowers our dealers on when and how to enroll, and we understand that some dealers in operating in markets with low EV penetration, uh, may choose not to enroll, but they'll have another chance in 2025." 4:09 So it's really heating up. Today's the deadline, and let the games begin. [laughs] I, I, I don't have much commentary on this except for the fact that I still don't think this is completely unprecedented. 4:20 We've seen this with particular moders- uh, models now. This is gonna be a little bit more widespread, more models coming in the EV landscape in the next two years. 4:29 Um, but, hey, look, I, you know- So you've seen it with models before. Like, g- give some examples. Yeah. Like, obviously we've seen it, like, you know, sub-brands like Scion, right? Toyota launched Scion. Yes. 4:38 If you want to sell Scion, you have to have a piece of your showroom dedicated, some training- Yes... some equipment. Um- Exactly, yeah... what else comes to mind? Or like the Nissan GT-R. 4:46 You, uh, you know, the Subaru W- WRX, I believe, is at, at, was at one point one of those. Um, I, I could be, stand to be corrected on that one. 4:56 Um, but yeah, so, like, e- especially in the performance model, and so if you think of, like, an early adopter-type thing. 5:02 I mean, even, even, you know, some, e- even just in, like, early availability of models was based on an, a, a dealer's ability to- Investment to, to deliver on it. Yeah. Right? I know. I- It'll be interesting. 5:15 I mean, this is obviously a powertrain and a platform, and not a model. It's, it's a whole platform. It's a, it's a lot more models most likely, even in the next two years for Ford. Um, and it's a large investment. 5:25 Now, I h- honestly, and maybe I just only know, uh, you know, urban dealers or suburban dealers, pretty much everybody that I've talked to is like, "Yeah, we're in for this." We're gonna try it. We'll give it a shot. 5:36 I mean, it's really, like, in the grand scheme of things when you look at the overall capacity for growth with the EV landscape, it's what, uh, $900,000? 5:47 Which I know- This day and age, after coming out of a record profit season, right? Right. We know the cash is there. I don't think it's a cash issue. I mean, everyone's saying, "Well, that's really expensive." 5:56 It's a principle thing. But, like, I think your, your point is right. It's a principle thing. Yeah. It's not that much cash for cash-rich dealers in this day and age. Yep. 6:01 But going into uncertainty, and it is, you know-No one wants to say yes on a principle that, you know, once you, once you crack that door open, right, the water starts coming over. 6:09 The, the problem is, is I, I think the bigger problem is what's on the other side, right? I think that's the question- Yeah... is this is a little bit too broad, a little bit too wide of a door crack. 6:18 What's on the other side is the question, and so I appreciate that there's some pushback here. Definitely some pushback here. I really wanna segue to go into this, but we don't have one, so I'm just gonna go- Stop... 6:28 I'm just gonna hit stop. Um, all right, let's talk about semantics for a second. So don't- Ah, I like semantics Don't- Words are important. We'll call words important. Don't call it a discount- [laughs]... air quotes. 6:38 Don't call it an air quotes credit either. Don't call it a discount, but Tesla is giving a rare $3,750 credit, but they're calling it, "It's just a price adjustment," Kyle. It's just a price adjustment. 6:50 It's just an adjustment to US consumers who will take- Man... delivery this month. So of a Model 3 or a Model Y before the year ends, Tesla's saying, "We will give, we will make a $3,750 price adjustment." 7:04 It appears to be, um, really in response, it appears that number's half of the upcoming $7,500 EV credit that will come into play next year. 7:13 And basically people are delaying delivery of their vehicles because this credit is coming next year, um, which makes all the sense in the world, and Tesla's saying like, "No, you have to take- They get it... delivery. 7:22 We've had this inventory. You've known it's coming. You have to take delivery." And they're saying, "Fine, then we will cancel the order." 7:28 So Tesla's just obviously trying to move and adjust and say, "Okay, how about if we adjust the price to half of this to, so you can take delivery now?" 7:35 I mean, the worst thing right now when there's a stack of people that wanna buy is having inventory sit at the end of Q4, and- So you're telling me- [laughs] I still wanna get you that shirt... that they got inventory, 7:48 sales goals, and rebates? Well, it's a price- Yeah. It's just a price adjustment. It's just a price adjustment [laughs] Kyle. It's just a price adjustment. Let's not go there. It's just a- Let's not call it a rebate. 7:59 It's so harsh when you say it that way. [laughs] It's so- It's so harsh that way, but I mean- So intensely auto when you call it a rebate, right? 8:07 It really is, and before you know it, they're gonna have service centers that will not- Oh, my goodness... [laughs] Oh, my. The sh- the gall. You mean they might have parts delivery people? Physical locations- Ah... 8:20 where you can walk in and drop your car [laughs] off and have it serviced. You know what'll be cool? I didn't think about this. They need some. They, they need, like, the deploy button. 8:27 Once the autopilot gets in, be like, oh, just, like, hit the little button, and you pre-schedule your car to just leave your house and go [laughs] to the Tesla place for service. That would be nuts. It shows up. 8:35 That's gonna happen. Why wouldn't that happen? Um, without a doubt, yeah. Why wouldn't that happen? 8:39 That would be awesome, just random cars just showing up at the store and, like, knowing where to file in line, knowing which bay to drive into. That's gonna, that's, like, the, that's future world right there. 8:49 Um- That's, that is- But, you know, as we, we talked about, like, two or three days ago this week, you know, Tesla's per vehicle profit is $9,500. Their next closest EV competitor is Toyota at 1,300. 9:00 So Tesla has a little bit of room to make a price adjustment, um, just to get through the next, you know, [laughs] the next 29 days. I feel like Dr. Evil. Like, our price adjustment. 9:09 I feel like this, this whole p- section, we should just call this the air quotes section. Yeah. [laughs] The, yeah, the, "And next segment is air quotes." We should. We should have a segment called air quotes. 9:19 [laughs] We should. I mean, uh, kids do it, why can't we do it? Speaking of the kids- Stop. Segway. Time. [upbeat music] We can do this. This one's fun. This one's kinda silly. Yeah, it is. It is. 9:30 At least in my world it is. [laughs] Well, it's real out- it's, I'll tell you what, in my world, I just live, I live this story, right? [laughs] Oh, man. 9:36 'Cause in the story, they talk about a 12-year-old and a 10-year-old sister. I have a 13-year-old and 11-year-old, so it just went through this. So while adults- Right... 9:43 including Brian Kramer, find [laughs] struggle to find good use for the metaverse these days, kids are socializing and spending money there. Um, and they happen to be now turning their nose up at cash. 9:55 Remember when you'd be like, "Hey, you do some chores, and here's a, here's a crisp new $5 bill"? Yep. My day was, like, a $1 bill, like, when I was a kid, right? [laughs] And it- Me too. Me too... 10:04 they, they don't want the cash anymore. You know what they want? No. They want virtual currency so they can spend in metaverse-like games, like Roblox. 10:12 Um, you know, so this great Wall Street Journal article and, and this, uh, parent, Mr. Robledo, 46 years old, I'm 43, I can relate. 10:19 He says, "They were handing it right back to me," the cash, saying, "Can you convert this to Robux?" [laughs] The way th- the way this works in my house is m- Ah... 10:28 is my, my Elise, she'll, she's my 10-year-old, or is she 11? [sighs] My, she's 11. Oh, boy. Yeah. [laughs] She's, she's 10. She's 11. She's actually, she's 11, yeah. 10:37 [laughs] She walks up to me, I'll be, like, sitting watching TV or talking to my wife, and she just walks up holding her phone. And she'll just hold it up to me- Right. [laughs]... 10:45 and it, it needs me to confirm, right, like, put in a little passcode to confirm- Apple Pay... like, the five bucks- Right. Yeah... or whatever. So, um, you know, so here's the deal. 10:52 Like, this story talks about, you know, a 12-year-old daughter Kaylee, and his 10-year-old, uh, her 10-year-old sister. They bought, [laughs] get this, a Gucci ba- a Louis Vuitton bag and a Gucci jacket. 11:03 I was wondering how my kids knew about Gucci. 10 bucks. All for 10 bucks total. From r- I'm like, why do my kids- Unbelievable... 11:07 like, they see Gucci, like, at a store, it's like, "Oh, someone's got a Gucci bag or a Louis Vuitton." I'm like, how do you know this? It's 'cause they know. 'Cause of- It's 'cause they've- 'Cause of Roblox, dude... 11:16 they've- 'Cause of Roblox. It's unbelievable. It's wild. But, like, you think of, okay, think about that from a brand play. Oh, boy. Right? What are they doing when they're 18, 20, 22, they've got their first job? 11:27 What are they saving up for? IRL, in real life. Done. In real life. No, it's true. Just like that. 11:33 If I got one of my kids something that said Gucci on it or Louis Vuitton, they would be excited, and it would make me feel, like, really disgusting and weird. Right? 11:41 [laughs] Like, why do my kids know what a Louis Vuitton bag is? How does this even happen? I've done [laughs] a lot. 11:47 So developers quickly realized that if they were gonna monetize a young audience, which is always questionable, right? If you're gonna monetize- Always, yep... a young audience, right? 11:56 It's different than, like, you know- You're really just monetizing their parents... putting ads up for, like, super sugary cereal and be like, "It's health food," right? Um- Right... 12:04 but yeah, so how are you gonna do this? They, they realized, like you said, they have to monetize for the parents. So what can we do to solve some parental needs? 12:10 They should, like, build in, like, an allowance function, like $5 a week.... goes into this. Like, that's what they should do. But a lot of brands- That would be-... like you said, are jumping onto the bandwagon. 12:18 So, like, usually when a brand would wanna, like, just get an advertising in front of a kid somehow, you know, YouTube pre-roll or just on a good old-fashioned commercial or movie pre-roll, brands are jumping in and actually developing games for Roblox. 12:32 So Chipotle jumped in, and they built a game where kids can build burritos. And they love doing this stuff. I watch my kids do it with all kinds of stuff. Where should we go to lunch, kids? Chipotle. No doubt. 12:43 And you watch the people build the burrito- Uh... and you're like, "Oh, I know how to do that." It's actually workforce training maybe. Uh, there's also Wal- What kind of car should we get? A Hummer. 12:50 That's what I'm talking about. [laughs] Kyle, you just got right to the punchline. Just right there. I don't know why we don't see any automakers in this space right now. 12:58 Or even, look, some of the l- larger local dealerships, you have the resources to develop a game that can be in Roblox and can be targeted. Like, it's really, really pretty insane, actually, the fact that you can do it. 13:11 Yep. I think Nathaniel Grechlik needs to be a character in Roblox, by the way. Uh, also- Oh, that'd be nuts... we talked about Walmart Land a few weeks ago, right? 13:18 And Walmart Land is this big kind of fantasy world where a blimp flies around and it drops, like, free stuff. Free stuff all over, yeah. And kids can collect and earn stuff. 13:26 Uh, there's Nike Land where you can, like, play games like basketball and shoot hoops, and you earn the ability to buy swag. So, um, you know, last little point from this article is, like- Driveway Land. 13:36 Drive [laughs] Quick Lane Land. That's, you know. Just calling it like I see it, Paul. Yeah. Uh, there's no way Driveway should not be in this fight right now. [whistles] Right. They should be all up in there. 13:46 All up in there. Mike Cavanaugh, if you're listening right now, get the developers together. [laughs] You know what's next. We'll ke- Get them together to scrounge together a game and drop cars from the sky. 13:54 We're counting on you. We're count... A little more than scr- scrounge it. [laughs] Scrounge it together. [laughs] Like, get scrounge a game together. 14:00 But pretty- Cars dropping out of the sky with, like, you know, lifted Jeeps. [laughs] Oh, that'd be amazing. Just... That'd be amazing. How fun would that be? Well, you're coming soon. Sounds great. 14:09 In 20- in 2023, brands are gonna be able to buy billboards in-game, so in-game billboards. Um, also, uh, p- buy... This is cool. You could buy a portal from other games into your world. So all of a sudden- Oh... 14:23 like, I'm playing, I'm playing this little whatever game I wanna play, and then all of a sudden, like, there's a portal and it looks really cool, and you're like, "Come to Nike Land and do this little bonus thing." 14:32 And you can go in the portal and it just transports you right into the game. So the beauty of the Metaverse- But Paul, Paul. [laughs] Is it gonna sell me cars in December? The... In, in one day it will sell you. 14:41 [laughs] The ROI is amazing. One December, it will sell you cars. [laughs] Come on. Well, it'll sell me one December. Maybe not one this, like, first December. That's hilarious, dude. That's hilarious. 14:51 But I mean, I, it's indicative, man. Times are changing. Um, you know, uh, look at just what we talked about today, right? 14:57 We're talking about franchise laws, we're talking about EVs, talking about Tesla, talking about Roblox. Um, keep your head up. It, it- Keep your head up, people... imagine that in 2019. 15:06 But hey, look, I think car dealers are savvy enough to handle it- All day... and jump in- All day... where, where it makes sense, control, and work on the basics, and dial it in. So- Yeah... I'm excited. So there you go. 15:17 If that's not reason to be excited to head into a Friday. The fortunate thing is that we all live in the real world every day, day in, day out. We get to interact with people. 15:26 So go interact with some people, and nothing feels better than a thank you. 15:30 [upbeat music]
