The Fed raised rates by .75 bringing the benchmark rate to over 1.5
Facebook leaked memo reveals direction to make feed look more like Tiktok
Is 3D parts printing in Fixed Ops departments on the horizon
Costco is selling a Bugatti EV for $920 with no destination fees
Kyle Mountsier, Paul Daly
Paul Daly 00:26
So when you walk in here, there's just a really big open space.
Kyle Mountsier 00:29
We want to bring legacy and innovation together in a way that only conversations around a soda community can. This is
Paul Daly 00:36
just a beautiful social layout, we have elevated layers of seating, we have all this natural light. And this is the space where there's going to be a lot of podcasting, and conversations and business done. And one of the coolest features about this room. No, it's not just because it has bathrooms. And it is that there is this amazing outdoor space. This is
Kyle Mountsier 00:55
one of the many outdoor spaces here at a soda con at XFINITY live. What we really think is going to be neat about this space is it is covered. But you get this nice space to have conversations really get together between dealers, industry partners, and have a nice space to get away a little bit get outside of the energy to drive innovation forward.
Paul Daly 01:14
When the keynote is overflowed, it's going to be shown on the screen here. But this is the room where we're holding all the conferences around operations. So all things use cars, that's going to happen in this room, as well as all types of conversations around operations.
Kyle Mountsier 01:29
So we're really excited to host a series of conversations, things from pitch tank to talking GA four or social media marketing, media mix, modeling, and even the technology that's coming into the automotive space.
Paul Daly 01:43
So this is the Broad Street bullies room. It's legendary. It's in your face, and there's just some thick emotion in this room. So if you are into culture, leadership sales, this room just has a vibe to
Kyle Mountsier 01:56
it. Welcome to PBR. PBR is the host of the asoto con marketing and technology breakout rooms. So what's gonna come out of this room is a lot of things that we're hoping to see crafted and created actually, not things that maybe are just already solutions that have had but solutions that we need to have in the automotive space in order to progress and move forward and solve the customer experience.
Paul Daly 02:19
So if you've ever been to an auto conference, this is the one that started out if you're sick of auto conferences in general or you just need something a little different. asotucon is the place to be September 11 through 13th Go to a soda con.com getting tickets now oh man starting out with little cribs this morning. We're also going to talk about that we're gonna talk about pumping interest rates summer shorts and going on 3d parts printing and a $920 Bugatti.
Kyle Mountsier 02:50
The people really want to know why. Look, I love this shot the shock and awe factor of wait a second you're telling me that there's a $920 booth Gotti who got to lean in when someone says that
Paul Daly 03:09
we're gonna we're gonna talk about that the end of the show, because it's the fun one, but it's a real thing. It's a real thing we promise. Like we just showed the video for us. So do cribs, where you and I you know last week in Philly, we walked through all the different event spaces, not all of them. Actually, we didn't even show them all in that video, it would have taken too long, we had a VIP lounge, we have an outdoor garage space that's like looks like it's open air. But it's actually all enclosed. And we've been talking about a show to con is shaping up. I mean, honestly, the last couple of days better than I thought it was going to and I thought I had pretty high hopes, right? We swing big. But a couple big things have happened in the last couple days. Number one, we locked in a presenting collaborator, we're going to have some more announcement myths about that. We have probably over a dozen other collaborators that have said yes. And we're starting to build out activations that we probably have another five or six more that are about to like, talk and commit. And yesterday, we got the word that our our feature keynote is a full go full lock. So exciting. Are we announcing that yet?
Kyle Mountsier 04:13
I may or may not have said the name yesterday,
Paul Daly 04:16
I used to go back and let's do it. Oh, wait on announcing it. If you
Kyle Mountsier 04:19
want to go back and listen, you can do that for the Wednesday, June 15 episode and you you know for the people that paid attention, you get that but we'll make sure that there's a there's a really strong announcement here coming soon because I think that it's just going to be an intriguing conversation that a lot of times like you know, just hearing from outside automotive that
Paul Daly 04:43
he's gonna make trouble. He's a full on troublemaker. We're gonna have him on a podcast. We're going going to be launching a new podcast. We haven't talked about this either called Auto collabs. It's incoming deeper conversations that will be guests on that podcast you'll get you'll get to know him quite a bit before you get to us. Otakon if you haven't already pre registered, you should do it right now at a soda con.com Because we only have 50 industry partner tickets. I hate it that that's the case. But we have space limitations. And the only way you can get one is if you're on that list, we're going to do a drawing to see who gets to buy one. I also want to talk about the Monday night party we were just going to have a concert. Monday night just became like a much bigger better event. Monday night now instead of just having a band which we know the band now is going to have it has all these restaurants in the rooms it's going to have what is it silent disco?
Kyle Mountsier 05:35
Disco, which I thought was completely weird. But I like researched a little bit on like people get
Paul Daly 05:44
it looks so yeah, silent disco, you can look it up, we'll tell you what it's gonna be later, we're gonna have karaoke. And one of the restaurants we're gonna have DJs, two different DJs in two different rooms. And then we're going to top it off Kyle with a band that you knew of before this, and I've gotten introduced to Why don't you talk about the band for Yeah,
Kyle Mountsier 05:59
so well. Okay, not a full lock on this band, but we're going to talk about it just oh, maybe we shouldn't talk about it, then we shouldn't talk about it. Okay, we're not gonna talk about it. We shouldn't talk about even though we're talking about it. But I promise you that if this band or the couple other that we're looking at, or
Paul Daly 06:15
somebody just chimes in, he was so pumped, I got some moose,
Kyle Mountsier 06:19
I've seen your bod, I've seen him, this guy's gonna be on the floor just crushed. Everybody's gonna be like DJ room, one DJ room to silent disco, and then all of a sudden, he's gonna be doing karaoke, he's gonna be on the stage, I know this is gonna happen. It's gonna be so good. I'm excited. Well, okay, we want to get into it. Also, we do want, we do want to let you know that like a lot of content that we're putting out. And if you miss the daily pod, or if you're interested in what's going on across the Saudi landscape, we really press into our LinkedIn, and just curating community around there. And we know a ton of automotive industry professionals are around that space. So make sure if you haven't followed us on LinkedIn, or Facebook, those are just the places that we that we play most often, and that we talk and have conversation throughout the day. So you can follow us at a so do on any of those platforms. And we'd love to just have the conversation throughout the day because the podcast is a great place to stay. But we've got that conversation that
Paul Daly 07:17
great place to start. Yeah. So specifically, LinkedIn, right? Go to LinkedIn search as OT, you follow the page and engage with the content. Because Kyle and I are in there on a regular basis, engaging with comments, thoughts, we're re sharing posts, and like, hey, LinkedIn is kind of been kind of in our spot. So it's our job to come to LinkedIn with us and hang out. If you're listening to the podcast, we'd love it if you'd leave us a review. Or if you're watching the live stream, just hit the like button, hit the little hands, give us a little love. Let us know you're out there. And it's been fun to watch the live stream audience grow. All right, people are not watching ESPN, because they're watching the show. So we got to show him some substance. And not just a lot of fun. I heard this. So yesterday, we talked about the thought that the Fed was likely going to raise rates by three quarters of a point, you've seen it everywhere. We don't need to give you all the news. But they did indeed decide that they were going to raise rates by point 75 basis points or point seven 5%, which is bringing the benchmark rate to a point and a half, basically 1.5. It's been 0% for a really, really long time. And also the 18 officials that were in this meeting, they came out and they said look, it's likely that the rate is going to be raised to 3%, or maybe even as high as 3.35375%. By the end of the year. I don't know about you, but they're saying that I don't really believe much of what they say isn't like I think a lot of it is is authentic, and what they're saying it but not much has panned out to be, you know, as optimistic as people thought it was so so but either way, I think we're looking at probably a minimum of three points. So, you know, we'll see what the markets react, but they do these things, they say these announcements and remember
Kyle Mountsier 08:52
that three points is is like the wholesale rate for banks. So you're right, four to five points in interest rates in in rates. So retail, you know, interesting. I like to keep my ear to the ground. And I was like, this is something that I want to contextualize for what's happening in auto right now. So I jumped on clubhouse this morning, which I don't do very often in the morning anymore, and there's some automotive people chatting around. And two really, really strong operators. I asked the question Hey, what what is what do you think or what are you seeing already is happening because of interest rate hikes. Granted, it's not so much in the like subprime or even near prime that it's affecting things. And it's not actually affecting purchasing behavior, whether or not people are or are not purchasing, but what they are seeing is an uptick in cash or light cash. So credit unions coming into the market so people are doing less at dealership financing, especially on luxury or higher price vehicles and so you're seeing more cash, instead of keeping that cash people are spending it because the interest rates are are higher than what the market
Paul Daly 09:59
is is that is that translate to to higher downpayment, like when you say more cash, or you're talking
Kyle Mountsier 10:04
about no more cash, like full cash deals. So, someone, someone that said like that typical, you know, most, most dealerships try and hover in that like 70 plus or minus finance penetration, they were seeing that trend downwards into that 55 to 60%. Cash or like cash, outside financing range. So really an interesting move. It's like people still have the money. But they're you they're utilizing that money in different ways, because of the way that the stock market is acting in the way that interest rates are acting. So yeah, it's not like people are stopping spending. They're just stopping spending in the habits that they were spending it, which was financing at low interest rates and holding their cash in the market.
Paul Daly 10:44
Wow, that's a great real time insight from some really great operators. Fed Chair Jerome Powell says that at this point, chances are slowing the economy enough to avoid recession or shrinking. So look, the takeaway is this. We talked about affordability yesterday, we talked about it a lot. Our boy Brian benstock says when's the time to fix the roof? Right when the sun is shining? Right. And
Kyle Mountsier 11:07
that's my best. Definitely wouldn't the drizzle starting look?
Paul Daly 11:12
Like? Did I just feel you felt that too? Yeah, right? Like, look, efficiency is going to be such a key part of profitability in the next 12 to 24 months that look across the board, we're talking with dealers that are looking at dialing in their marketing spends again, now if you know what marketing spend, we're gonna get into marketing for second, when there's no inventory, or when cuts their marketing spend. But guess what's going to happen as inventory comes up, you're going to need to compete for the buyers again. And if your marketing ecosystem is sloppy, and bloated, and not put together, guess what? You're going to lose? So efficiency across the board. Obviously, we've gotten a lot of operational efficiencies over the last few years, the pandemic really put that forward. I think we've gotten lazy on our marketing.
Kyle Mountsier 11:54
Yeah, I agree. And well, maybe maybe lazy isn't the right word. But I do think that that we've shifted in titles, right in title in our marketing and, and also, we have shifted our focus to a lot of service, you know, a lot of user acquisition. And what my fear is, is that we just like a lot of dealerships might whiplash back to sales when they start to lose transactions, and they go like, straight into transaction mode. And customers aren't going to be ready for that because the pandemic has forced a different type of conversation in marketing. And if you whiplash everyone into sale mode, or transaction mindset or anything like that, there's going to be zero stickiness there. Right. So
Paul Daly 12:41
speaking of fast transition. Facebook, in a leaked memo from Facebook, they revealed their new direction to look a lot more like tick tock, right. You know, what tick tock videos are, that's my fast transition thing, right? A lot of fast transitions, a lot of movement. This is a quote from The Verge article, the meta executive in charge of Facebook, Tom Allison spelled out the plan that rather than prioritize posts from accounts that people actually follow, Facebook's main feed, like tick tock will start heavily showing you recommended posts regardless of where they came from. Yeah, not the stuff that you want to see anymore, or from the people that you connect with. But things that Facebook knows you're like, Oh,
Kyle Mountsier 13:26
someone actually on Instagram, I think they've already started this move on Instagram, they Oh, for sure. Anyone recognize that? Basically, everything that that you see in your Instagram feed is recommended. And for you and sponsored posts, basically,
Paul Daly 13:40
it always catches me by surprise, because I'm like, I get like, four or five reels deep. I'm like, what? I don't know, we're the people that I know. Right? Yeah, the people that I know, it's very
Kyle Mountsier 13:51
interesting. So I think and I think that as a whole, I think I don't know that they didn't really say this in the article. But the reality that both Instagram and Tiktok are what I would call immersive or full screen experiences, right? And Facebook is nothing like that. Actually, LinkedIn is actually pressed more into kind of a full swing and experience. Yeah. Oh, and mobile for sure. They were moved on mobile, a lot of like that noise. And I don't think Facebook has really gone that way. So it's interesting because a Facebook user probably likes that. And so I'm interested to see how you know as they transition into this like immersive experience, which is really what they're saying they're gonna do. You know, do they do they keep users that does it? Does it stay sticky? Or does like that copycat mode actually hurt them?
Paul Daly 14:41
Yeah, I don't know. It worked really good for Instagram, right really became a very quick tick tock competitor. In related news, right YouTube shorts, which is like YouTube's version of reels and kind of Tik Tok format, has 1.5 billion views just last month, right? Like my kids watch YouTube shorts, right? It's like one of those things. That's format of quick transitions. You know, bite sized chunks, I'm sure it's destroying our mental ability to like, keep attention, right? It's destroying us as as like, you know, like being thoughtful people probably. But it's just look just what people, these platforms give people what they want. Right? And that's really how it reacts. And another interesting move, you know, remember several years ago Facebook, separated messenger, right messenger, separate app, Facebook, separate app right there, all these privacy concerns and these integrations while Facebook's bringing them back together, to more closely mirror the Tick Tock messaging function, where it just shows up in Notifications show up like right within their feet. So So Brian Ortega comments, Facebook equals Get off my lawn. So good. So Facebook is now Clint Eastwood, which is a great personification of them, I think, as a media
Kyle Mountsier 15:51
platform. Well, and I always thought, like, they acquired WhatsApp around the same exact time that they move messenger out of Facebook, it's like you basically have two messaging apps now. And granted, WhatsApp and audiences are in the US, right? But you know, if they want to, like make sure that everyone's kind of playing in their own sandbox
Paul Daly 16:12
that they just wanted to make sure they had all the information, honestly, because you think about it that was in the transition, what was it was in a transition time when a lot of a lot of, you know, communication was going dark, right? So behind the wall of private messaging, and things like that. And so they kind of wrap their arms around that. But like, here's the deal. You got to give the people what they want. So we were talking about marketing. Let's talk about marketing for another second. Yeah. Go ahead. I got you. Because you got me see, that's how it works. He just,
Kyle Mountsier 16:39
I think I got you. It's like, hey, we were talking, everybody was talking about vertical content, vertical content, vertical content a few years ago. And I think that it's much more it's not even just vertical content, it's immersive content, and the way that people are communicating.
Paul Daly 16:56
So how are you when you say immersive? You mean, it takes over your entire screen? Right? Yeah.
Kyle Mountsier 17:01
And thinking about like, that's what people are. That's how people are interacting with the content that you provide them, whether it be in stories, or in reels, or in tic TOCs. Or in whatever like the the move to messaging and this new app interface UI that Facebook is after. Like, you have to understand that your content has to like have that immersive feeling that inline content, and not feel sponsored or not feel just like contrived to distract attention, and you have to stop the scroll, whether it be an ad or organic content and thinking about the way that people are engaging in interacting, like as someone that is vying for attention you have to do that's right.
Paul Daly 17:45
That's pretty much it. I was gonna say, there you go. You now see, I gotta give the people what they want. Fixed sob story here, pick this up in the automotive news fixed ops section or whatever story about 3d parts, printing parts departments, like now this is over the horizon, right? So this is not happening right now. So it's not like, oh, my gosh, can I get my 3d printer? Well, maybe if you're good enough, you could. But Curtis, wild parts manager at Murray Honda in Chilliwack, British Columbia talk to us about the application of 3d printing in house, talking about the fact that they've had cars sitting there for months and months, that they just need like one little part for one little and the car is down, that would apart that would fully be fully able to be produced by a small 3d printer. Right with the right material loaded into it. And the right plans molded into it prints out 10 minutes later, you put it in the car, the customer goes home. Right? Talk about practical,
Kyle Mountsier 18:39
it is. For me, it's a no brainer. Like you have to get. You just have to get closer to the edge to the customer. Yeah, the closest you can get to so why wouldn't? Why wouldn't OEMs license the CAD drawings for that stuff?
Paul Daly 18:55
Right? Because IP, intellectual property came up as a major concern. Sure, right. But here's the thing like you can solve that problem. And like you can still buy other parts, right? If the plans are there's the printing machine is connected to some level of I don't know, maybe that's even something to do with Blockchain. Who even knows? But 3d printing parts? You know, they say this possible in five years? I think it would be possible way sooner than that. And the parts shortage, right? We're talking about reducing our dependency on outside sources, right? It's not even like, oh, well, this international issue. It's not even that. I mean, look, we had issues where we just couldn't ship especially this one is in Canada, we just couldn't ship stuff. Why? Because people were protesting on the bridge. It was like practical,
Kyle Mountsier 19:35
right? And just, there's just not enough workers to get the stuff shipped. There's like, right 1000
Paul Daly 19:41
reasons why you should have a 3d parts printer that's printing those easy to make parts, relatively speaking, that can be installed and get the customer on their way. And look, if you even have a drone, you could fly these 3d printed parts to other stores that need them as well. Right?
Kyle Mountsier 19:56
Uh, speaking of delivery segue man I messed it up I was good. You could hop on your 18.5 mile per hour 242 pound capacity 20 to 25 mile rainy day the word Bugatti
Paul Daly 20:22
we're calling it a Scoogati it's a Scoogati so Costco actually is selling this is an awesome article I found on Jalopnik they're selling a Bugatti scooter through Costco. It's $920 little pricey for electric scooter. But it isn't Bugatti and it legit is a Bugatti, right. It's not like someone bought the name badge. They did partner to develop this with a company like Kyle said, almost 90 miles an hour, which is fast. If you're on a scooter, you're like a super fast Yeah, 242 pounds capacity. So it can handle a big person 20 to 25 mile range. Like that's far. Yeah, that is far. I mean, you can almost pay someone through a marathon on that. I mean, you probably run out before that because of lower speed in the torque. Right. But I mean, you're gonna be close enough. It's got headlights, taillights, turn signals, and some of the early reviews say they commented on the premium packaging. I don't know. Maybe Maybe we'll get one and give it away to the community for people that share it.
Kyle Mountsier 21:18
Don't you think that we aren't too proud to go from the hotel at a soda con? To the asoto kind of it on
Paul Daly 21:25
Regatta? Every morning who got it? Got it? We may need to have that happen. Well, look, we tried to take you on a little bit of a trip this morning. Out of school, gaudy. Look, things are changing. Things are happening. asoto cones coming I don't know what to tell you to do right now. But all I can tell you to do is that you need to do something. So go do it.