Gone is the iPod, Carvana in the News, & the VW Scout back as an EV

May 11, 2022
Digital Dealer may be wrapping up today, but the automotive industry has a full head of steam. For those that are iPod historians, we have a sad truth hitting the airwaves today. From things leaving to things coming back, we know that change is always in the air in the current market.
Listen On

Apple to Sunset the iPod for good

  • Released in 2001 and touted to hold up to 1,000 CD-quality songs on a device that fits in your pocket. By mid-2007, more than 100 million iPod devices had been sold.
  • Take Away: Not everything lasts forever. Even the greatest of inventions/innovations sometimes need to make way for future change and innovation.

Carvana to freeze executive salaries and cut 2500 employees

  • The 2500 employees make up 12% of the company
  • The news comes just after Carvana closed the deal to acquire ADESA
  • “They have lost more than 50% since raising $1.25 billion in an equity offering last month.”
  • Employees taking to Twitter to talk about the seemingly cold way the company approached the cuts
  • Take Away: As dealers, our people are our greatest asset. Care for your people well and they will care for your business well

Volkswagen is bringing back the Scout as an off-road EV brand

SPEAKERS

Kyle Mountsier,Paul Daly

 

Paul Daly 00:21

Here weare, again, we're hanging out the last day of the digital dealer conference inTampa. And, you know, we had a really good night's sleep last night, which wereally, really badly badly needed. I was coming off two nights or four hours.It's just, I don't work that way.

 

Kyle Mountsier 00:37

I justdon't work that way. No, yeah, it was it was a good night's sleep, we ran hard,we would like our legs were done. I said, we're coming back from coming backfrom the digital dealer party across an American social last night. And I said,I'm going to take off my shoes, and literally, my feet are gonna balloon out.

 

Paul Daly 00:57

But thatdoesn't mean there's not a lot to talk about. Aside from just the ice, we sayit all the time. Right? The energy was amazing, right? And it can get verycomplacent, because we say that all the time. But there, there's a different.We said that at nada. But here at Digital dealer, even after the second nightof conversation. It's an amazing feeling when someone comes up, and they'relike, I feel the same way. Yeah, right. And they're like, I didn't know otherpeople thought that way. And you realize they just start coming out of thewoodwork. There is a literal undercurrent of people. A lot of them are in thiscommunity. Right. But others are coming to it. Right, like a beacon. Yeah, thatis what makes gets me so excited. Because like, oh, there are a lot of othersthat haven't even started to find out about what's going on,

 

Kyle Mountsier 01:40

youknow, we get the words, we just get. Thank you a lot, right? And I think thatit's like, oh, yes, there's a thing that I can be attached to the other peopleare believing and thinking in the same way. And so I think just recognizingthat there are not just others out there that are believing thinking workingtoward the same thing. But also that there are probably others that don't evenknow it exists that are searching for it, or maybe not even searching for butthey they there's like this recognition that there's something more

 

Paul Daly 02:13

got tobe something else. Right, right. Because they feel it. It's palpable. Exactly,but so so that that went on quite a bit last night, you know, we went to thethe digital dealer party that they have on the second night of every event. Andwe joke because we get back to the hotel room when we realized, like we startedlike six conversations that we never finished. Because someone inevitablyalways comes up and says Hi, and then we get just an amazing conversation.Right, right. And then we start talking about something and then it happensagain, and again. And again. And every single conversation is like this. Right?As people, they have this idea, or they they saw piece of content, or theyconnected a different angle. And they're like, I was really thinking aboutthis. And we're like, yes, that this person is a troublemaker,

 

Kyle Mountsier 02:55

exactly.We I had we had a great conversation last night with a young team, right that'sbeen put together by someone and someone that has been so faithful in the asotucommunity and really given so much life to it. But they've put together thismarketing team that is young and vibrant, and they're out here at Digitaldealer, but they're not just here, the way that they're talking about the brandthat they represent and the stores that they represent. And the things thatthey get to do. They've got a social media coordinator and SEO person andthey've got a website person, they've got a project manager, and then the CRMperson, a CRM person, just this young, vibrant, excited, right? And then wemeet the one guy this morning is like, we were just up with people in theindustry till 630 in the morning

 

Paul Daly 03:38

and he was bright eyed and bushy tailed. Hewas ready to go. Yeah, I've got things like, oh, I don't drink. Right? It seemslike no, he's like we were we were just talking about the industry. And justthat Yes. And I can't do that. No, no, we were tapped out. We were joking. Wewere like, like, Okay, I'm older than I realized. Like, I remember those days.But

 

Kyle Mountsier 03:57

that'sthe kind of energy that's around the industry. And that's finding the others.It is it is.

 

Paul Daly 04:02

So we dohave some fun news to talk about today. Today. Feels good. To get backyesterday, it was more like we talked about some news. But we're still in thehustle of the floor. today. We had a little more time to set up a little moretime to build the show. And we're reading the news, and we're going back andforth. Hey, did you know this like what? Yeah, it's been a whole day. Right?

 

Kyle Mountsier 04:20

Likewe're so used to kind of like being in and around the news. They all get awayfrom it. And all of a sudden you're like, look how many things happen.

 

Paul Daly 04:27

Sometimeshonestly, sometimes nothing happens. Right? Yeah, right. Sometimes, you know,Chris is like walking around looking for a story. I were like, I don't know. Imean, we can talk about the same stuff again. Right, right. But today, there'sthere's actually a lot of nostalgia for it. We'll call it some. There's likethe establishment nostalgia, right? Because it's back in the day and I thinkthere's some modern nostalgia going on, right Carvana but first we want to talkabout something near and dear to our hearts. We're both musicians. Right? Weboth love music, and the Apple has announced that they will be sunsetting theiPod

 

Kyle Mountsier 05:00

Can wejust have a moment for that?

 

Paul Daly 05:03

We havea video clip from Apple's first release of the iPod. And this is back in 2001.Do you remember your life in 2001?

 

Kyle Mountsier 05:10

I doremember my life in 2001? Yeah, I just this whole this whole, like put a solidthat kids young right on me. But no, I was just starting high school in 2001.And look, if you don't think that the iPod was like, the thing you had to have,it was so groundbreaking. It was unbelievable. And what's really wild to mewith the iPod, and I kind of put this in the show notes. This is my note onthis is like, the reality of how innovative and how inventive the iPod was inthat moment to go from like, literally in 1999 2000. The thing was the Walkmanor the CD ROM player, right? Like everybody, like it was. So do you rememberthe CD ROM players like you click it shot, and then you could get shot too manytimes, and then it would pop up. And every time you had a piece of tape on thething, right? All of the and the Walkman before that. And then all of a sudden,this massive, innovative thing drops. And everybody's like, this is the mostcrazy thing that I've ever seen in my whole line blowing. And only three yearslater, they literally start to replace it with the fact that we now have asmartphone actually part of the phone. Yeah, yeah. So it sounds a wildinnovation.

 

Paul Daly 06:27

Soinitially, here's the sales pitch for the iPod. It can hold over 1000 songsover 1000 and

 

Kyle Mountsier 06:36

nuts,songs. And we were actually talking last night we were like in remember thefirst one that came out. It was a massive, it felt like

 

Paul Daly 06:44

it was agood half inch. Right. And this might sound crazy. It had a mechanical harddrive in it. Yes. Yeah, mechanical hard drive. And you know, for those of youwho remember, eventually, you know, just inevitably, mechanical hard drivesalways fail at some point. And so they had an issue where all of a sudden, likeyou wouldn't move, you know, in the sense, you had the little jog dial, but itwould just stop right? You wouldn't be able to like switch songs or anything.And so the trick was, you had a hold it about, you know, four inches above atabletop and then drop it and just drag and drop, and then it would kind of likeJar the needle. Yeah. And then it would work for a while and then eventuallydrop it too many times. So it had mechanical hard drive. But the CD, the CDplayers, the Walkman CD players that we had before that, yeah. Do you rememberany skip protection? Yeah, in the beginning, you walked with it, or you had itin your car, and you literally couldn't like move it because the seat the laserwould skip. And then you would just you would your music would skip. That'swhen they started building a little memory into them. So it would scan threeseconds, and then it was five seconds. And then there was 13 seconds and itwould scan. So it can like get past the skips, because it's playing from thecache. Yes, exactly. And, and so I went in 2001. I had graduated high school,and I was kind of I think first year of college. And this is how you rolled. Ihad a big fat portfolio full of like 120 discs. Discs. Right? Absolutely. Wewere listened to. And you're like flipping through them. This is not that longago. So for all of you who just that. I mean, what's the year probably if youwere born after 1990 You probably didn't live with much of that.

 

Kyle Mountsier 08:23

Not muchof it. I think like 90, like up to 9495 You probably have

 

Paul Daly 08:28

1000It's over. You're like what are you guys even talking about? Right? So I mean,it's near and dear to our hearts. i But there's still some left. I mean,obviously move to the iPod Touch right, which is basically a phone without thephone functionality. You can still get those but I mean, the original iPods.They're gone. But it was an unbelievable groundbreaking. And the real takeawayis that like

 

Kyle Mountsier 08:47

anothersunsetting, the whole brand, right? Like the whole iPod brand. And yes, likeyou said, the takeaway is innovation moves fast. And being willing to say like,No, we got past that we it was a time it was necessary as necessary for us toinnovate. Do that. Yeah. And then now move now move past it. I think about likethe way that I think about this is right early, early on. I mean, everythingthat you knew in selling cars was a Foursquare. That's how you pencil cards.It's how you do it. And then all of a sudden, we had desking software's andpaper came out. And that was an innovation in the late 2000s. Really, right, itwas like to print a paper thing to put in to put it on on the paper that had adesking solution. And that's still a reality for a lot of people today, whichis not a very long timeline to move into a new innovative space. And so realizingthat change it change for change sake is not is not the best way to go. Neverbut change because there's something new that necessitates a new customerexperience. And understanding that sunsetting the old thing doesn't mean you'reletting it die. Because it was bad. It just was a necessary tool to get you tothe next thing. And I think there's so much of that in automotive right now.Um, that we just need to be looking at. So

 

Paul Daly 10:02

yeah,don't don't hang on you have to let go one vine and get on the other one. Andthere you go. The iPod R I P, talking about letting things go. I wish we had

 

Kyle Mountsier 10:14

morelike stop segway records.

 

Paul Daly 10:17

OhCarvana is not only on a higher, they're freezing the salaries of their executivesYes. And they're letting 2500 2500

 

Kyle Mountsier 10:27

Peoplego, which is 12% of their entire workforce. So for me, this is a somber moment,right? Because it's it's obvious that there is profitability issues thatthey're staffing issues. And that's 2500 People that woke up yesterday thinkingthey had work. And today don't. And so I look, no matter what your feeling isabout Carvana. Like that is a company that has people that has people in ourcommunities that is in automotive, that is having to make decisions about theirpeople strategy. And so and

 

Paul Daly 11:04

theseare operations, folks. Exactly. Right. So they're letting go of operationalstaff. So I mean, auto dealers. Yeah, talk about having an opportunity to scoopup 2500 folks who have probably been trained, really well probably have somegreat insights. Yeah. And to doing things a little bit differently. Man, I'mtargeting I'm targeting these people.

 

Kyle Mountsier 11:22

So many,I saw so many LinkedIn posts coming last yesterday afternoon, like, hey, look,over here, over here, right? I saw some large dealer groups in Michigan and inout west saying like, hey, look, if you're close, we've got space like we needto hire, we're ready for you to come on.

 

Paul Daly 11:39

And whatI think is gonna happen. So this is a real this is another layer of something Ihadn't think about. We don't we never talk about this actually. We talk aboutyou know, auto dealers being supportive the community and employer, but thinkof the level of consistency and stability in employment. Yeah, in automotive.Last time, you heard about an auto dealer laying people off? I don't think I'veever heard

 

Kyle Mountsier 12:03

that.No. And I remember in the pandemic, it was intentional that so many auto dealerswere like, We will not

 

Paul Daly 12:09

absolutely,who's doing that. So good. Who's doing that? And like even that, it's like, youcan even put an asterix next to that the whole pandemic thing, right. But likeyou think of like there is a definite disadvantage to working for big corporateAmerica publicly traded corporate America, right. When you're beholden tostockholders, rightly? Yeah, right. When you play with public money, right?You're also a slave to public opinion. And now like, obviously, they're justclosed on the ADESA deal. And really, these these announcements came kind ofsimultaneously, I believe.

 

Kyle Mountsier 12:42

Yeah,no, yeah. Yeah. So yesterday, they they finalize the deal to purchase DESA,after Apollo had had kind of rescued them with that with that money last week.And so they were able to actually like, ink that thing and make it move Apolloword. Right. So, you know, so between, between that, and then heading straightto talk to employees. So you're like, we're going to spend 2.2 billion, right.But because of the profit line, because of the way that we're operationally notsound, we've got to make these employee decisions. It's such an interestingdynamic, some employees

 

Paul Daly 13:14

took toTwitter to talk about how cold actually how cold li The news was served. Yeah.And then it very, it wasn't,

 

Kyle Mountsier 13:24

itwasn't like, you know, Oh, thanks for the time there. Yeah, right.

 

Paul Daly 13:28

It wassome fight. We've got some amazing, right. And so that's another layer like youthink about a layer deeper in brand. Yeah. Right. And you think of thebillboards you see with a car with a halo around it, and the perception and thedisplay of what car dealers are like, and this situation is very obvious, like,Who do you want to work for? And not only who do you want to work for? Like,it's like, Who do you want to do business with? Yep. Right. And thenenvironment when people like the little guy is has a voice, and the underdog orthe little guy is usually surrounded by the larger community. Yeah, largerculture. It'll be interesting to see how that turns out. But I think it's lookyour your true colors start to show with that, right? And their true colors,not that they're not at all that they're bad people. Not at all. But the truecolors are that like, they operate a publicly traded company, a publicly tradedcompany. Yep. Right. And it's not as warm and personal as walking in ashowroom, seeing the RN with the family name and so yeah, so I hope those 2500people I assume they're gonna find employment very, very quick very

 

Kyle Mountsier 14:37

quicklyand I hope that it's an automotive I really they haven't even new renewed senseof energy toward the retail automotive industry.

 

Paul Daly 14:44

Imagine ifsome of these people get to get a job at like, Carter Myers, or beaver Toyota,right? They're gonna be like an all these years all these years. We weretalking bad about that. Again, they're gonna realize the reality I hope thathappens to us. Look if if you happen to be watching this and you are, yes, sendus a DM we will connect your side you summary with our best places to work inthe country ever. No exception. Maybe some of these. I might be unemployable atthis point in my life. I've been an entrepreneur for so long. But but there arejust one or two folks. That hiccup I would work there. Yeah, I would work thereand do whatever I could. So yeah, so that's that. We've got one more fun one.This is just South Asia, the South Asia. Further way further back than the iPodway further back. Yes. So

 

Kyle Mountsier 15:34

Volkswagenhas announced that they are bringing back the scout but not as just a vehiclewine. They're going to separate it as a total Evie off road brand

 

Paul Daly 15:45

inUnited States focused on the American consumer. I love it. Right. The scout waslike a little boxy car, right little rugged little off road. And VW has alwaysbeen a brand company always. Ever since that thinks small campaign, right? Wehave the big billboard and they're like, look, everyone's saying this. You wantthis tiny car in an age when it was like huge Buicks. Right and Cadillacs. Andthere was like, they were like, You know what, there's no Jaime it. Thisthing's tiny. So they literally listed the features like featuring, it was like13 inch wheel. Right? Right, a small cabin to cool, right, whatever it is,like, they just like listed all the tiny features. We lost them like they, theyyou can we can actually move this over. If that battery's dead. They featuredall the small things because they understood brand marketing, and they havethis big old picture in this little tiny car, right? They this low cost ofmaintenance it like it only takes like two quarts of oil. It's just lean intowhat you have. And then you go through the years and they've always been intouch with the human side of the business. You know, I remember probably one ofthe ones that I love is the Star Wars commercial with a little kid, right? He'sdressed up like Darth Vader, and he walks out to the car. And he puts his handup. Yeah, the dad like clicks. It looks up he's like, right. And so so thesecars look super cool. They do look super backup. Isaac, they were up here.There's two versions, there's a pickup truck version. And there's like a littleSUV

 

Kyle Mountsier 17:11

version.Yeah, but like not an SUV. Just a really cool thing.

 

Paul Daly 17:15

A littleRanger over the tires look really cool. I mean, we'll see how close they lookwith veto. He's pretty good about bringing the concept to life. You know, like,I've always been, in this point the crap out of me when they bring like, oh,that's the production model, right, like talking about a bait and switch. Theydecided they made a very conscious decision to not try to compete with thelarge truck market, right, obviously huge market in the US. So that but like,you know, it's dominated by Ford, and Chevy and RAM. And so they said, we'reactually gonna go pick up but more like the Ford Maverick sighs Yep. Andthey're going to build invest 100 million in a plant here in the US. Andthey're saying like, this is what the American consumer wanted, they're gonnaroll them out pretty quickly. 2026 Wow, just four years before

 

Kyle Mountsier 17:56

2030.

 

Paul Daly 18:00

Sothey're expecting two models by 2026? You know, obviously, they're going toleverage that I'm assuming I didn't read this, but they're going to probablyleverage their existing platforms. Without it. Right? You know what I mean, andbuild around it. But this is, this is one of those cars, I'm actually reallyexcited. It's gonna be really, I wouldn't I would probably drive one of these.

 

Kyle Mountsier 18:17

I know,right. I think that, that, especially like, these OEMs. Taking that like brandapproach on something new and fresh, will give them a new marketing approach.It'll give them a fresh way to engage with consumers fresh way to engage withdealers. And so I'm excited to see what they do. We should

 

Paul Daly 18:34

weshould get John Luciano on because I know he has. He's got an opinion. We cansqueeze him for some dates. Yep. Maybe he'll dish a little bit, you know,

 

Kyle Mountsier 18:41

withouta doubt. Yeah, he'll, he'll punch a little bit for sure. Yeah.

 

Paul Daly 18:44

So therewe go. It's kind of like a day of nostalgia. We have a day of work ahead of us.We're still here at the conference. But it's just one of the rare times wherewe're in person together. We have some of our team here. So we're going toactually plan and plot out the future of the movement. And we have some funannouncements. Look, block off your calendars first. Second week, a secondweek, second week, second week of September, we're getting a little closer toannouncing something. Yeah, we're gonna put together an event that we thinkmight just shake it up quite a bit. Yeah. So we're

 

Kyle Mountsier 19:14

reallyexcited. We're gonna have a lot of fun with that. And so yeah, just keep youreye out for that event.

 

Paul Daly 19:19

Untilthen, stay connected as much as you can. We know that if you're watching thisright now, you're already a troublemaker, you're already in the community. Butwe guarantee you, there are hundreds and 1000s of other people out there whobelieve the same things and need to be here. So whether that's the live stream,the podcasts, our social media channels on Instagram, LinkedIn, Tik Tok,Facebook, you know, we're trying to drip feed some trouble all day, every day.And of course, you know, the email is the center point. I gotta say this onetime, our senior writer Chris. Well, he was on site here.

 

Kyle Mountsier 19:52

He wasliterally the life of digital deal. I think everybody actually came to see

 

Paul Daly 19:56

yougotta give him some love. Because he's one of the one of the kindest, most likedWell, funny people I've been, I don't even know. I don't know how to explainhim. But all that to say, if you don't get the daily email, you need to get thedaily email that he writes. And you know, we work together, put it together,but he's kind of the heart of the email now. Yeah, and you won't bedisappointed. You can get it at a sotu.com sign up for it. I'm telling you,you'll be really, really happy you did. But until next time, tomorrow, we'reflying home tonight. And we'll see you tomorrow and we'll be back in the saddleas usual on a Google meet for eight hours a day. Until then, keep it real. Keepsharing things bring people in this community. We need you and we need them.