OEM Dips, Lots of Summer Trips, and the Art of Haptic EV Motorcycles

May 4, 2022
We can’t believe we didn’t work in a May the 4th be with you story as we’re talking about the consumer mindset today. Despite inflation and record-low OEM production, consumers are planning a big summer according to indicators, and we think Retail Auto should have something to do with making it happen!
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Several OEMs report double-digit drops in deliveries for April YoY. Each company pointed to ongoing supply chain issues pulling down day supply, leading to lower delivery volumes year-over-year. 

  1. Kia -16%
  2. Hyundai - 20%
  3. Toyota - 23%
  4. Honda - 40%
  5. Genesis  +45% (5k v 3200)
  6. Experts watching the situation hold to a return to normal inventory levels in 2023, but admit the balance between inventory and customer-facing inflation is delicate and can lead to unpredictable blips in the business.
  7. Take away for Auto Dealers: This is why focusing on the things you CAN control separates the winners from the losers. Process, company culture, and brand deployment lead to increased market-share. 


Air BnB  showing very strong Summer demand w bookings at higher than usual prices

  1. “...said it expects to post its first (ever since it’s founding in 2008) full-year net profit this year after its revenue climbed 70% last quarter as people continued to book suburban rentals despite hosts raising prices.”
  2. “Revenue was helped by customers booking a record number of nights and so-called experiences during the quarter and hosts raising nightly rates because of inflation. Airbnb’s gross bookings—the value of bookings made on its platform—grew 67% to $17.2 billion, a record.”
  3. Take away for Auto Dealers: The consumer mindset is all about having a great, post-pandemic Summer. Help them do it. 


Harley Davidson’s EV Brand “Livewire” is about to release the Del Mar, a middleweight motorcycle built around LiveWire’s Arrow platform, which includes a battery pack, electronics, and motor, in a single unit that the company can then build various bikes around

  1. Expected to be much cheaper than the Live Wire 1 which MSRPs over $21k
  2. 0-60 3 seconds   146-195 miles per charge 
  3. 80 mins full charge
  4. Haptic pulse
  5. Take away for Auto Dealers: Even though you don’t sell bikes, buy one and put it in your showroom as a conversation starter around EVs. All the motorcyclists will come see it…and their other car is a car. 

SPEAKERS

Kyle Mountsier,Paul Daly

 

Paul Daly 00:23

Don'tknow if we just say an upfront fee with you even at a graphic for it, but we'regonna talk about other stuff Oh em dip summer trips and the art of haptic Eviemotorcycles people oh man, we got all kinds of names for the graphic all theall the May the fourth gifs GIFs, whatever you want, of course, is with ustoday. So you know Isaac, our producer is a huge Star Wars fan and a huge LEGOfan. So like all come together Danielle has built in May the fourth easter eggsinto our Asana workflow. It's unbelievable.

 

Kyle Mountsier 01:03

It'sit's complete team mentality. You know, I love Star Wars. It's always you know,I've seen every one of them watch, watch the original trilogy growing up,watched all of the new Mandalorian and all of that type of stuff. But it'sstill you know, it's not quite a holiday for me so but I you know, play along.Yeah, may the fourth right

 

Paul Daly 01:25

therewas there was a time in my life when I would have watched Obi Wan Kenobi mowhis lawn, right.

 

Kyle Mountsier 01:32

Likethis is really just like looking at actually been like, yeah, he

 

Paul Daly 01:39

Iwonder, I wonder when I feel like maybe the fourth is like a recent phenomena.Maybe it was like more of a nerdy one. But I wonder when it actually started.Isaac, if you know when it started, feel free to jump in and just let us know.I feel like outside the last like five to eight years. I don't remember talkingabout it.

 

Kyle Mountsier 01:58

1979election of Britain's Margaret Thatcher, though. Celebrate May the fourth akaStar Wars Day.

 

Paul Daly 02:09

Look atthat. You know what year was born in 1970. That

 

Kyle Mountsier 02:13

goodout? Actually you are always remember of all things. All things may 4. Youknow, I doubt that. All right, well. Here it is. Okay, so to celebrate hervictory, her party took a half page advertisement in the May 4 1979 issue ofthe London Evening News that read May the Fourth be with you, Maggie.Congratulations. No, that is a genius level marketing like expert level unlockthat's unbelievably lasted 43 years

 

Paul Daly 02:47

so far.It became a part of culture,

 

Kyle Mountsier 02:51

likeinternational culture because of a campaign in 1979. Come on now. Good.

 

Paul Daly 02:58

It's sogood. Well, talking about culture and doing things that shape culture. ThisMonday, May 9, we are having a family reunion remix live in Tampa. Evening,Tampa evening, seven o'clock was I wanted to say the time Yes. And

 

Kyle Mountsier 03:13

I'm inseven to 10 we're going to be at American social right across the water fromthe convention center. So if you're going to digital dealer, or if you justlive in Tampa, and you work at a dealership, if you are drawn over, you do nothave to be in there for digital dealer to attend this event. We've actually gotpeople driving in flying event in particularly for this event. You know, Paul,actually, I was on a I don't know if anyone knows. But Jim Ziegler named himselfthe alpha dog back in the day and kind of like a stalwart of our industry froma training especially finance side perspective, and has always led a lot youknow, he had the internet battle plan for years and years was kind of one ofthe first people to show that you could send videos via flip phone, right? Sohe was like, Gee, he was like the early Steve rustler. Right. And yeah, and soyeah, without that, yeah. So like,

 

Paul Daly 04:05

all theStar Wars references. Nate, you missed this. You missed all sorry.

 

Kyle Mountsier 04:09

But Iwas on with him and a few other people that are coming as well as speaking. Andthe all the energy was like, Yeah, we're excited about going to the sessionsand hearing who's speaking and, you know, it's always you know, Kevin Frey andGreg Gifford and incredible people that are speaking. But all of the energy isalways around kind of like what happens in the wings, right? What whatconversations and energy and, you know, Greg was like, here's the thing, I'mgonna be there. And if you want to ask me an SEO question, ask away like, I'mnot charging consulting dollars at the asoto family reunion. That's right. Oh,that's incredible. You're gonna be sitting there with David Zbyszek, one of themost profitable dealers of all time, right? So you've got the opportunity toand everybody's a regular person. You don't have to go up and and be like, Ohmy goodness. Now I'm walking up to Have a quote unquote, you know, influence orin the automotive industry like everybody's a regular person, just engage, askquestions dive in. And that's what that event can be all about. It's not justabout the, you know, the fun and the party and the food and all that type ofstuff.

 

Paul Daly 05:15

So twoevents. Yeah, exactly. This is not just like, get it, get your drink and findyour way to the next thing, like, there's going to be a lot of fun, there'sgoing to be swag, there's gonna be giveaways. But more than that, they're gonnabe very meaningful conversations that are happening. And always do, I wouldrather have 10 minutes, five minutes with someone in a setting like that, thenlisten to a one hour keynote because I'm going to get more insight in thosefive minutes. So we hope you'll join us. If you are a dealer work for a dealerif you know any dealers in the Greater Tampa area, anyone with them really likean hour's drive, please let them know this is going on, even if you can't bethere. Because dealers if you work for dealer, you get to go for free thanks toour friends at auto phi, who paid for all the dealer tickets. So, you know, thetickets are starting to sell a lot faster now, now that we're getting closehappens every time, right? People are like, Oh, what am I going to do onMonday? I think it was like 35 tickets yesterday. By the way, it's like theonly thing to do on Monday night. So yeah, you don't want to be the one thatcan't go because we sold out tickets go to a so to.com as ot you just click onthe little banner at the top, reserve your tickets. Now even if you're a dealerand you go in for free, you still need a ticket. It's a ticketed event, therewill be people at the door. And that that is what it is also have pitch tankcoming up today at 10 o'clock Eastern. So if you're watching the live stream,just about 45 minutes from now, pitch tank on clubhouse, where three industrypartners will pitch their product very short three minute pitches. When was thelast time you got a three minute pitch from a

 

Kyle Mountsier 06:41

like,and all the people rejoiced, right?

 

Paul Daly 06:44

Right.So think about this nine minutes of listening and you can get three pitches.And not only that, but we have, in my opinion, some of the biggest experts inthe tech space. In the dealer space, we're gonna have dealers, we're gonna haveindustry partners, sharp minds, asking questions about the pitch, maybeshooting some holes in the pitch with with a good good mentality wait with theSpirit. And that way they can ask questions that maybe you didn't even know youshould ask or maybe questions that you wanted to ask. And you were just wereembarrassed to ask at the end, the pitches are all rated. So there will be awinner. The winner will be featured tomorrow's email last week, we have a lotof fun. And look, these are just always a great time to learn. So if you'rethere one hour, you will get three pitches and lots of insight and a lot offun. So just check that out on clubhouse. If you do. What's our club,automotive state ot to Union union, or so to SOTU dot club, we'll get you thereas well. Let's talk about a little news. Shall we do

 

Kyle Mountsier 07:39

it?Let's do it. Man, we're talking to OEMs this morning. And you know, we're kindof starting to get all of the April data rolled in. And, you know, I don'tthink anyone in the auto industry was like really, but just to see the data ofa lot of companies still struggling with supply chain issues and looking atlower delivery volumes in the 16 to upwards of 40% with Honda. So lowerdelivery volumes Kia 16%, down Hyundai 20% down, Toyota 23%. Down and Honda 40%down on total deliveries in April. Now here's the crazy one. And it's

 

Paul Daly 08:17

yearover year, APR year over year last year at the label and April of last year,guess what we were talking about?

 

Kyle Mountsier 08:23

Chipshortage. Yep. It was the very first time when things were really were reallyhitting right because that was late, late March, early April, where all of thesupply chain issues kind of got jammed up.

 

Paul Daly 08:33

Peoplewere like, I think this is going to be a problem.

 

Kyle Mountsier 08:37

Just forand then everyone was worried. Back by August

 

Paul Daly 08:41

tothree, we'll have you guys all stocked up by q3. You can take that to the bank,

 

Kyle Mountsier 08:45

take itto the bank, right? Yeah, and then Genesis coming out flying with a 45%increase. So continued attention on Highline brands. We've been talking aboutthis for a while that island brands are managing supply chain a little bitbetter, because they're pushing chips toward that, obviously Hyundai pushingchips probably toward the high lines of Genesee, let's

 

Paul Daly 09:07

behonest, they have to push that many chips. They didn't have to push them at1800. Right. So it's worth saying it's first saying that brands alive andkicking.

 

Kyle Mountsier 09:16

Yeah,injured. And so now like all all of the focus is on 2023 for coming back withsupply. And that feels realistic to me that feels the most realistic, right?Like,

 

Paul Daly 09:27

let's behonest, it's going to be another nine months CZ.

 

Kyle Mountsier 09:30

Yes,definitely. You know, and this is we kind of we've been leaning into thistakeaway. And I think this is where I want to spend a little bit of time is focusingon what you can control, right? Used inventory acquisition, and making surethat your brand deployment that your culture which is a part of your branddeployment, our sound setup solid so that when things do return, that you'reready to go, and again, controlling your used car inventory, right becausethat's something that you can go purchase from the consumer. And sure that youhave quality, you know, merchandising setup, like that's things that you cancontrol that that are that are day to day blocking and tackling to be set upfor when new car comes back, that that is just kind of like a part of the flowof the store. Right? Yeah.

 

Paul Daly 10:16

I mean,like, it's easy to listen to all the high level data and stats. And we'vewrestled over this, right? Because we want to present usable things everyday tothe audience, that we can actually improve the industry. And look, when wereport and say, Hey, like year over year, April or April, these OEMs are down,like what are we supposed to do with that? Well, first of all, it's like,realize there's so much in there, we can't control what was the last time youtried to control what an OEM does, and we're successful at it.

 

Kyle Mountsier 10:42

Well,that's a loaded, you just loaded that. When was the

 

Paul Daly 10:46

lasttime that was actually right. So the point behind that is like, there are 1000things that we can control on the ground. And the most profitable dealers,guess what they look at what the OEMs doing, they blink twice, and then they justkeep going about what they were

 

Kyle Mountsier 11:00

alreadydoing. And then they go talk to their fixed ops director

 

Paul Daly 11:03

rightafter that's absolutely right. And guess what they continue to do? Crush It,crush it. So that's the takeaway on that story is like Focus, focus on thethings you can control. Think about it be informed, and then all the thingsthat Kyle just mentioned, right your operations, your fixed ops, your branddeployment, your company culture, when you do those, right, guess what thattranslates to market share it trends, it always translates to market share. Sowhether the pie is this big of inventory, or if it's this big, you want thebiggest percentage of it because the pie will get bigger again. And when it does,you're gonna have more of it

 

Kyle Mountsier 11:35

timemarket opportunity for you, right, you're gonna get inventory quicker, all ofthe things right if retention is set up services set up, and CPO volume is setup. The manufacturer is going to look that well. So focus on the things you cancontrol No,

 

Paul Daly 11:48

no doubtand everybody else. Another thing we try to focus on this next news story isabout indicators. We try to look at Broad indicators not just from automotive,right because a lot of times Automotive is the indicator that other industrieslook to retail indicators what's going on in automotive, so that means we don'treally have a direct place to look but we like to look at other things andculture in travel and hospitality right consumer mindset. Airbnb is showingvery, very strong summer demand with bookings increased bookings at higher thanusual prices. They said from from this Wall Street Journal article said theyexpect their first ever profitable quarter since founding in 2008. First ever,

 

Kyle Mountsier 12:29

I can'tbelieve it. Because I mean, just to be real. I looked at the place where thefamily normally goes to the beach. Yep. It will be 45% more expensive to go tothe same place this year. Oh, last year 45%. Which is a lot. That's a lot ofmoney. Yeah.

 

Paul Daly 12:49

It wasit was probably a lot of money before.

 

Kyle Mountsier 12:51

Well,okay. So like two years ago, mid pandemic we went to we always got the sameplace. Like it's just where we get your thing. Yeah, it's just our thing. Twoyears ago, it was like, wow, that's cheap. Last year, it was like, okay, thathurt a little bit. This year. It's like,

 

Paul Daly 13:07

I don'tknow. We might, we might buy a fire pit and some marshmallows, and a couplebags of sand and sit outside. Exactly. So their first profitable quarter ever.If you remember, Amazon was not profitable for a really long time. And I kindof ironically, or Amazon just had its first unprofitable quarter in a long timelast month. So people consumer dollars, right shifting to getting away.Shifting to this experience. It says revenue is held by customers booking arecord number of nights and so called experiences during the quarter and hostsraising nightly rates, their gross bookings, which is the value of bookingsmade on the platform grew 67% to $17.2 billion, which is a record. And here'sthe takeaway, right? Right. This indicator number one, people are willing tospend money to get away spend money to like, you know, their mindsets about havinga great post pandemic summer, right? Yeah, help them do it dealers

 

Kyle Mountsier 14:06

helpthem do it. Because, you know, if you've been on Google Flights recently, orsouthwest.com or any of those places, you know full well that thing up andthey're expensive. And so the affinity to maybe purchase that new vehicle orthat that certified pre owned or something to get away for this summer, rightmaybe load up the family in the van or whatever it may be the affinity to dothat is going to be a lot higher than maybe you know grabbing the flights oryou know traveling in a different way. So like, probably your marketingmessages, your campaigns your everything should be should like we typically dothis summer travel thing, but like your service stuff should be focused on howto get people to their experience. lean

 

Paul Daly 14:52

into it,right? Yeah, you have a great summer plan. The last thing you need to worryabout is your vehicle. Exactly right. lean into it right not forever, but ithey when you take that cultural momentum we say this all the time right theinternet and cultural momentum is a river right don't drop a boulder in themiddle of it trying to tell by this by that right build a little boat let itfloat on top of the river here's a little help right people are the indicatorsays people are excited and willing to pay more money to get out of town thelittle boat with your marketing and be like we're going to help you to screwthat

 

Kyle Mountsier 15:21

get onthe stream I mean Jared Kilwa is out help out here building his boat he'sinvited me to his to his beach house yeah luckily he's you know he's not gonnahit me over the head with a two by four with the with the money so let's Yeah,

 

Paul Daly 15:35

yeah,Bobby Rossa jumps in looks like the communities get you covered. Yep, there yougo. everyone's coming to your place. This last story near and dear to my hearta little skeptical. Definitely as a motorcyclist, but Harley Davidsons, Eviebrand, they create a brand called Live Wire is about about to release their DelMar, which is their second release. It's a bit of weight motorcycle builtaround their arrow platform, which is a battery pack of electronics, theinverter and the motor in the single unit that they're going to build a lot ofbikes around. I gotta say, the Eevee motorcycle thing has been gone. Wow, Idon't know that's gonna be

 

Kyle Mountsier 16:09

on thismotorcycle. But like my thing is when I think of a motorcycle, what do youthink of that noise? Down, Right? Like that's just like the first thing thatcomes to your mind. Like my son takes a motorcycle and runs it around thehouse, like making the noise and the sounds every time

 

Paul Daly 16:26

that'sreally think about it that way. Now what sound is he going to make their firstvehicle, their first motorcycle, the Livewire one that has an MSRP of over 21grand actually goes zero to 60 in three seconds, um, goes about 150 ish mileson a charge takes 18 minutes to charge up. And here's the one point and thennow I'm talking about their first bike, right? The specs haven't been releasedfor the new one. But it's, it's going to be much more affordable. They'resaying, or people are speculating. And it has a haptic pulse to it. So youthink when you use your phone, right, and he got the little little pop up, popup, right? So I'm like, Okay, well, maybe you can get creative with the hapticpulse, because that really does kind of add to the experience of using yourphone. Right? Okay, maybe you're riding it and you get the haptic going on. Andlike it gives you a little feeling. But then I'll tell you what, my favoritebike to ride I have two bikes. The favorite one to ride is my 1979 that you'reon, isn't it? Yeah, you feel it is a little loud, but it feels like you're sittingon an engine. It feels like there's

 

Kyle Mountsier 17:24

nothingabout that. It's similar to like, I you know, I tried to get an electric mowerone time. Well, the one thing that I love about mowing is like the enginerequires you to kind of like wear headphones or just like be stoked it all out.Right? Yeah. And I feel like that's very similar to a lot of motorcycledrivers. It's like, look when I'm on my motorcycle, and nobody talking. Right?We're doing a thing right now. So

 

Paul Daly 17:53

zero to60 in three seconds. You're still focusing on anything else. Right? That's whatthey say they say if you if your mind if you're thinking about a bunch of otherthings, right? Because it's important to be focused on your motorcycle right?Because one little one little thoughtless moment could mean you're dead. Solike if you're thinking about other things, it just means you're not going fastenough right? Just gotta go fast just gotta go. So um, you know our takeaway islike look dealers even though you don't sell bikes, right? Most there's a hugemotorcycle community right? This is a huge transition, right? You're trying toeducate people about EVs? Right? There's buzz around it, like buy one of thesethings and put it in your showroom that's what I think

 

Kyle Mountsier 18:34

youshould do. Yeah, drop yourself like an Eevee and old car a motorcycle, evenlike an A and you know, whatever your brand has on the showroom and just createan education matrix for that.

 

Paul Daly 18:48

That's agreat idea because we know you don't have any inventory to put

 

Kyle Mountsier 18:52

Rightexactly. Yeah, you don't have a genius Come on. Let's go

 

Paul Daly 18:57

if youdo that, please send us a picture and let us know because we're going to startencouraging other dealers we put some

 

Kyle Mountsier 19:02

of thosestands with like a timeline up right and so people can kind of walk it andexperience that yeah, use it make some content and just

 

Paul Daly 19:09

makesome content about it. Have a little community event about to get themotorcycle community and come out right because there are there are other caris a car.

 

Kyle Mountsier 19:17

Yes,exactly. On rainy days, right.

 

Paul Daly 19:20

That'sYes. In upstate New York. You can ride your motorcycle for specifically two anda half weeks. That's great. Oh, that's all we got for you today. We hope youtake away a little something from this look. Go to the party. If you're inTampa may not be there. Pitch tank we're about to jump into that room, cipheranything. Focus on what you can control and go bust it out.