Not So Bad, Tesla’s Win In Court, Homeschooler Takeover

November 1, 2023
It’s a new day in a new month as we talk about the potentially light residual effects of the strike on the industry. We also cover a big win for Tesla in court as well as a homeschooling trend that seems to have staying power.
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Show Notes with links:

The UAW's simultaneous strike against the Big 3 initially stirred fears of colossal financial damage, but as the dust settles (maybe), early indicators show that the $2.9 billion loss seems more manageable than critical.

  •  The UAW's 146,000 members secured a significant 25% wage increase, cost-of-living allowances restoration, and additional benefits.
  • Ford, facing an increase of $850 to $900 per car cost, along with Stellantis and GM, plans to find efficiencies to balance the escalated labor costs.
  • Stellantis weathered the strike with over $3 billion in lost revenue but contained profit losses to about $800 million, outperforming GM and Ford.
  • Investors initially panicked, slashing $40 billion from GM and Ford's market value, but S&P’s recent upgrade of Ford's credit rating shows a silver lining.
  • Chris McNally, an analyst with Evercore ISI, optimistically noted, "We believe that GM should be able to offset most of the UAW-driven increased wage headwind."

In a landmark decision, Tesla triumphed in the first U.S. trial concerning its Autopilot system's involvement in a fatal crash. The verdict, favoring Tesla, underscores a pivotal point: despite technological advancements, the responsibility for road safety ultimately rests with the driver.

  • The case revolved around a 2019 incident where a Tesla Model 3 veered off the road, resulting in a fatality and severe injuries.
  • The jury, after four days of deliberation, concluded 9-3 that there was no manufacturing defect in the vehicle.
  • Tesla maintained that the driver was under the influence of alcohol, and it was unclear if Autopilot was active during the crash.
  • Jonathan Michaels, representing the plaintiffs, stated, "The jury's prolonged deliberation suggests that the verdict still casts a shadow of uncertainty," highlighting the complex nuances of the case despite Tesla's legal win.
  • Tesla stated, "The jury's conclusion was the right one,"

Homeschooling is experiencing a historic surge in the US. This trend transcends the common stereotypes of homeschooling, attracting a diverse set of families for a variety of reasons, ranging from dissatisfaction with traditional schooling to seeking a more value-aligned education for their children.

  • Once considered a niche choice predominantly favored by religious families, homeschooling is now becoming a mainstream educational option across the nation 51% increase in the number of homeschooled children compared to the 2017–2018 period, now including more students than Catholic School
  • Parents are opting for homeschooling not only due to concerns over traditional education quality but also for reasons such as addressing their children's unique needs, avoiding bullying, and ensuring curricula align with their values.
  • Financial support from government programs and nonprofits in several states is making homeschooling more accessible and appealing to a broader range of families.
  • Emerging Industry: The rise in homeschooling has spurred the growth of an industry dedicated to supporting homeschooling families, including platforms like OutSchool and companies like Prenda that facilitate microschools.

Paul Daly: 0:31

Okay, I have music playing. Playing good here. The Fader has to be up today. We got a few things to talk about. It's November 1, talking about things that are not so bad. Tesla's went in court and a homeschooler takeover the people Yes. To asset homeschooler takeover, wouldn't they see?

Kyle Mountsier: 0:48

Let's go talk to that one.

Paul Daly: 0:51

That actually I realized that phrase homeschooler takeover probably elicits a very

Kyle Mountsier: 0:57

there's like a shuttle. Like everybody's

Paul Daly: 0:59

there's probably a barrage Do you see zombies takeover? It's like a homeschool takeover. You see a lot of prairie dresses. You see a lot a lot of barefoot kids. Oh my god, we're gonna change that. For what we're all about changing perceptions.

Kyle Mountsier: 1:17

That's amazing. Hey, last night, so um, you know, the, the, the little the little thing around Halloween just real quick. And it's not about like, we had a ton of fun. We you know, we go out in the neighborhood. The thing at least we're home because three of them were sick. Oh, no. Yeah. So we had a ton of fun. The kids were out bail us out the whole nine yards. But I'm scrolling Instagram just like winding down at the night. You know, like we all do. And my buddy has shared a little thing that was like all parents, please. Let's stop talking about the the the tax on on goods like the parent tax. Right? And I was like, where's this going? Like, are you just mad at people talking about this? Because I talked about all the time they were like, no, no, no, this is a dictatorship. You will get what you deserve. You will only get the food rations of the candy that you deserve. And I get the top you know, I was like, Whoa, that's perfect. Like, oh, well parents just say and this is all my candy. I was like, Whoa, come on. It was

Paul Daly: 2:25

it was real fun to just see all the pictures as it always is and people text and pictures. Matt last year's family. They had the Super Mario brother theme going which is fantastic. We had Mario Luigi Princess Toadstool. It was good stuff. But it is November 1 now. And I woke up to snow. wasn't really expecting it. I mean, I woke up to 31 degrees. So if there was some participant it'd be crazy it it could have snowed in Nashville could have easily and we're about that same temperature you walk outside. It's not like biting cold, but it's like the most pleasant snow you're ever gonna see. Right? Everything's cleaned it is slow falling. Flakes. I'm like, This is what I love. Yeah, I'm gonna hate it in 90 days. Because I'll go 90 days and be like, Yeah, I can take this but like, February March, some of a

Kyle Mountsier: 3:15

good news isn't just to the next two weeks, you get to be in some nice warm, sunny weather. We are headed to use car week next week in Scottsdale, my first time. Have you ever been there? I've never been there. It's a great time. Like it's there record attendance this year as well. Which is really, really cool.

Paul Daly: 3:32

Those two aren't connected by the way, right that we know of.

Kyle Mountsier: 3:37

No knows. And and then the next week will be at Mater retail conference, the past group conference that that is in Florida. So we're excited to be in some sunny weather coming from the cold and connecting with dealers and industry partners and OEM reps. Because connections conversations are what drive our industry forward. So that's why we always love being in the dirt at those events. No,

Paul Daly: 4:00

can't wait can't wait for that. Also more than more than Episode Two is been officially launched. You can see it for free as well as the pilot episode. If you don't know what that is. It's actually our TV style Docu series, where Kyle and I travel around the dealerships across the country. And we tell the inspiring stories and we happen to start competing on a few different things. I'll let you know the who wins or not. There's more episodes coming. We eat hot wings in Buffalo. We try to do all the things and make it fun but guaranteed every time we've screened this and now we've probably in person have screened it in front of over 1000 people collectively. There are tears there are laughs There are incredible sentiments shared and I think you'll really enjoy it. We made this for you and it's such a great thing to show in a Morning Sales Meeting. Hey Go. Yes, really check it out more than if we can help you.

Unknown: 4:51

We can speaking I'm helping morning

Kyle Mountsier: 4:57


Paul Daly: 4:59

trying to find the Right segway, but

Kyle Mountsier: 5:00

as a matter of segue, we were so good yesterday. It was so good. Yes. All right. Well,

Paul Daly: 5:05

we'll come through for you if you're on the live stream, we got to come Friday. So check this out the UAW simultaneous strike against the big three initially stirred fears of some colossal financial damage for the big three. But as the dust settles, maybe the dust is settling. early indicators show that the $2.9 billion loss seems more manageable than critical, the UAW is 146,000 members have secured a 25% wage increase and sometimes more when you factor in cost of living. Some additional benefits Ford is facing and we heard about this talked about this a little bit yesterday, an additional increase of 850 to $900 cost per vehicle, which you know, where that's ended up on the sticker along with Volantis and GM plans to find more efficiencies and balance the escalated costs obviously are ongoing, but so it's the Lantis seemed to weather the strike better than Ford and GM. They had 3 billion in lost revenue, but only 800 wholly 800 million only lost profits. And so basically investors on all three, initially panic, we saw $40 billion in market cap go away from GM and Ford's value. But s&p recently upgraded Ford's credit rating, which is kind of a little bit of a silver lining Chris McNally and analysts with Evercore ISI optimistically noted, we believe that GM should be able to offset most of the UAW driven increased wages.

Kyle Mountsier: 6:32

They should be they vote off. Yeah, so early on, there were a lot of people talking about anywhere between a five and $8 billion impact to these OEMs from a revenue perspective. And so to only see 2.9 billion is is great. The other point of this, and we saw this through the articles, and through some of the stuff that was coming out of these manufacturers, is they weren't just cutting the people cost because they were they were having to let some people go at these at these factories. But they were also looking to reduce costs across manufacturing across marketing, and making sure that their expenses were in line as they moved to be able to efficiently you know, and be more efficient as they move to increase these wages. So it seems like the balance that Wall Street is saying that there's going to be balanced there. I also think that some of some of the change in the way that analysts are looking at and the West, the way the s&p is looking at the credit rating may be also due to the decreased focus on the Evie outlook

Paul Daly: 7:36

without a doubt. I mean, they say never waste a good crisis. And I think the I think specifically Ford and GM, use this situation as a major pass to be able to say we're cutting way back on this because if all of this EV like the reality setting in that the drop in consumer demand and a non strike period, they would be facing some very specific heat over this. But I think they pretty masterfully use this situation to scale back on that. And I think Wall Street's reacting to that. And I think the internal the CFO is like

Kyle Mountsier: 8:10

Thank you. Oh, they absolutely are

Paul Daly: 8:13

speaking of breathing sighs of relief. Segue. We'll take that as a segue. That's a good one that's going in a landmark decision Tesla triumph in its first US trial concerning a fatality and autopilot in the verdict favoring Tesla. It's underscoring a pivotal point that despite technological advancements, the responsibility of road safety ultimately rests on the driver. So the case was revolving around a 2019 incident or a model three veered off the road, resulting in a fatality and some severe industries injuries of the passengers. The jury after four days of deliberation, which is pretty long, concluded nine to three that there was no manufacturing defect in the vehicle. Tesla maintained that the driver was under the influence of alcohol at the time, and it was unclear if autopilot was even activated during the crash. Jonathan Michaels representing the plaintiff said the jury is prolonged deliberation suggests the verdict still casts a shadow of uncertainty. Tesla said the jury's conclusion was the right one.

Kyle Mountsier: 9:13

Yeah, I mean, Tesla is gonna hang their hat on this and so is like everyone that's looking at autopilot. There's still a lot of uncertainty because of the driver being under the influence. Like it wasn't the like the cut and dry case around autopilot where everything seemed to be, you know, where like, it was clear autopilot was on it was clear, the drive driver wasn't integrated, right? All of those things, I think, are still to be determined. But the more and more we go down this path, it's going to set more and more of a precedent. And this is the one big thing that we've been looking at regulators to really understand, like, Where does the onus fall? Is it on the manufacturer that drove all those And this doesn't just land on on on Tesla right now? Because there are autopilot It functions and feel Yes, that's all the stuff right there are Yeah and like recently crews had their their license revoked in a couple of cities. So they can't like do autonomous delivery of stuff. So there's there's a lot of impact to not just like full autonomous driving but also things like radar cruise control and and other things that take the ownership of driving at the manufacturer level. And so I'm interested to see like, what are the next ones? What what does this lineup after that, but Tesla I'm sure is just going to like they're just going to continually like make big big arrows back to this one.

Paul Daly: 10:38

No doubt. Hey, this crews been revoked in in Phoenix because we were planning on doing that. Or those that wave Oh, that was way Mo is Phoenix.

Kyle Mountsier: 10:48

So we're still we're still we got we got a week away from doing the way mo Okay, yeah.

Paul Daly: 10:53

Just like cats from a way mo coming your way.

Kyle Mountsier: 10:56

Yeah, we got a look at Nathan. He's he's typing he's typing stuff in our show notes. Just stop the cruise. Who's has ceased operations due to

Unknown: 11:07


Paul Daly: 11:09

I love it. So this is real time updates from time I'll always make sure the show is on point and now he's listening and he's like, Wait, whoa, let me get you two jokers in line. Let me Yeah. And now that there's pressure on him you know how hard it is to type when someone's watching you.

Kyle Mountsier: 11:25

issues related to crashes it was in San Francisco right. So they had their so they had their their license revoked to do the the autonomous driving in San Francisco. So Oh, they've cease operations everywhere. Due to San Francisco. Wow, that's even bigger. I didn't I didn't know the everywhere maybe we'll find that story go a little bit deeper on it tomorrow.

Paul Daly: 11:44

Sounds good. Sounds good. Speaking of learning things,

Unknown: 11:48


Kyle Mountsier: 11:52

as evidenced by yours truly homeschooling is experiencing a historic surge in the US. This trend transcends the common stereotypes of homeschooling, attracting a new diverse set of families for a variety of reasons. The reasons that are cited in, in the study noted that there may be dissatisfaction with traditional schooling, looking for a more value aligned education for for their children. Typically, historically, homeschooling has been reserved for a niche of religious families. But it's becoming more mainstream, seeing a 51% increase in the number of homeschooled children compared to the 2017 to 2018. That's, that's a ton, like 50% of the previous high. And it now includes more children than Catholic school. So that's just like one segment a pretty well, packaged school. That's huge. Some of the other concerns that parents cited, they want to cater to their children's unique needs, avoid bullying, and ensure curricula curriculum aligns with their specific values. I'll say this, like, just anecdotally, we moved to homeschooling this year in our house, and we're loving every minute of it, like we're two and a half months, and I think, and our kids are enjoying it. But the one thing you know, from from that, I think is still the big question mark is like, Can all of these new parents that are entering homeschool? Like, are they well equipped to train at the level and to guide at the level that that the school teachers are that have been educated on on teaching? So that's, that's kind of like the the outstanding, what's the impact five, seven years down the line from now?

Paul Daly: 13:38

Yeah. And if I'm an educator and I went to school to be a teacher and an educator, of course, that's my concern, right? Yeah. Because I learned that there's one way to do it, it's this way. There's also a lot of emerging industry bouncing up right, the entrepreneurs are stepping up, the innovators are stepping up. And now there are all these platforms available that were never available to homeschoolers, I want to call it out school companies like prenda that actually facilitate they call the micro school so you can have five to 20 students that kind of get together with a certified instructor. So a lot of things right innovation is pushing this growth. The reason I think this ties back to our industry, we're seeing an emergence of a lot of an entrepreneurial mentality when it comes to raising your family, auto industry, lots of family business, a lot of industry partners to small companies that sprung up to serve a need in automotive that have now with this remote work that is available. A lot of industry partners now are deploying remote work. There's just a greater intentionality that can happen at home. And what that means is that these people who are just naturally geared toward learning, growing, developing, educating are now we're seeing them bring their families into the mix. We're seeing more families around stores, we're seeing more families around industry partners, we've been homeschooling for our whole our oldest miles who works for SOTU. He's 17 he's gone through start to finish. We never homeschool Before all of our other kids homeschool, and I'll tell you what, it is amazing to bring our children into the entrepreneurial world. Nathan's typing show notes and he's homeschooled to all 12 years. Oh, you didn't know this, you didn't know this. But the bottom line is, this is an opportunity, I think, for the auto industry to bring the next generation along in a deeper way. If you can write everyone can homeschool, it's complicated. It's a lot of work. But the I think that the next generation of automotive, I think there's gonna be a very high percentage that were homeschooled. That's just my

Kyle Mountsier: 15:32

I agree. And then the other tie down to this is look at these these companies like outschool and prenda, that are taking market opportunity as entrepreneurs and going this is a new market segment that's rapidly growing. How can I serve that segment? And I think that auto dealers would do well to look at one of the rapidly growing segments that are parallel verticals to auto and how can they serve that industry? Well,

Paul Daly: 16:00

that's great, man. I like I like November 1, it feels good. November feels good already. Already. Whatever you're doing today, go out there. If it's snowing, enjoy the snow if it's not enjoying the sun, whatever you do, love a few people sell a few cars make a little bit of money.

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