Special Guest Elon Musk, What Inventory Level?, 20 Years of Gmail

April 1, 2024
Happy April 1st as we roll into a fresh week, fresh month, and fresh quarter all at the same time. Today we’re talking about landing Elon Musk as a special guest. We also ask what we have learned as an industry about inventory levels, as well as looking back on 20 years of Gmail. 
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Show Notes with links:

In a decisive stance against e-commerce giant Amazon and competing OEMs like Hyundai, Toyota President Jack Hollis voiced a resolute "no" to selling cars on the platform at the Automotive Forum New York. Here's why Toyota is charting its own digital path:

  • Hollis emphasizes the risk of bypassing Toyota's established dealership system, calling it “a completely divergent path”, advocating for direct engagement with consumers through traditional channels.
  • Introduced in 2019, these digital retailing tools developed for Toyota and Lexus are continually refined based on dealer feedback, ensuring a tailored, seamless customer experience.
  • Toyota commits to enhancing the digital buying experience within its ecosystem, prioritizing the integration with dealership management systems and safeguarding customer privacy.
  • Quote from Jack Hollis: "For us to take the dealer's input and provide it so they have a tool to make it seamless for you, the customer — that, to me, we're all in on."

Inventory has been a hot topic in the industry and questions still loom whether OEMs can learn from more stringent inventory levels or whether flush inventory will return.

  • New-vehicle inventory last month reached 2.8 million vehicles, a 78-day supply, according to Cox Automotive, up about 1 million vehicles from where it had stood a year earlier.
  • Tight inventories during the pandemic led to a significant increase in industry profits, reaching $55 billion in annual dealer profits in 2022.
  • Despite the potential benefits of lean inventory management, factors like dealer competition and manufacturing overcapacity suggest this success may be hard to replicate.
  • J.D. Power analysis reveals a direct correlation between inventory levels and dealer margins, highlighting the profitability of operating with fewer vehicles to sell.
  • Automakers and dealers expressed intentions to maintain lower inventory levels, but the return to pre-pandemic inventory and incentive levels seems inevitable.
  • "We've learned [as an industry during the pandemic] that we can operate at lower inventory levels," said Tyson Jominy, vice president of data and analytics at J.D. Power.

20 years ago, Gmail burst onto the scene with an unbelievable offer: 1 gigabyte of free storage, revolutionizing email and quickly becoming a cornerstone of our digital lives. Now, with over 1.2 billion users, it's a staple, yet many wonder about its future role amidst evolving online communication tools.y

  • Despite its success, Gmail's role in daily communication has shifted, with platforms like Slack and WhatsApp taking precedence.
  • Over the years, Google enhanced Gmail with features like better search, themes, and smart replies, though its essence remains largely unchanged.
  • Gmail has evolved beyond a mere email service to become a crucial part of our online identity, critical for accessing various online services and accounts.
  • The future of Gmail might focus on making email management more intuitive and joyful, possibly transforming it into a digital assistant for our lives.
  • “We definitely recognize that Gmail is almost like an identity. It’s almost like it’s a representative of you in the outside world,” says Ilya Brown, Google’s VP of Gmail. “How do we help identity to evolve with [Gmail] users over time? We don’t have a solution yet, but we’ve been thinking about it.”

Paul J Daly: 0:00

Good morning, everybody, April 1 2024, we're starting a new week, a new day, a new quarter all at the same time. Today we're talking about landing Elon Musk as our special guests as well as inventory levels and 20 years of Gmail, the people that was a lot in one intro, Id they stopped.

Kyle Mountsier: 0:27

A lot figuratively and literally,

Paul J Daly: 0:30

like, not only did we get through a five, Saturday, five, Friday month of March, which I know we're going to see some amazing results from when the numbers are finally in. But also we start today, New day, new week, new month, new quarter, all at the same time. Like about a fresh start

Kyle Mountsier: 0:48

talking about this. Yeah, ready to go. You know, I will say this was interesting. So I got from a faithful listener, David Ortiz, I got a text on Friday afternoon, he was like, Hey, watch out for all of these like massive up swings and new car delivery retails. There is a ton of final pay action happening on on manufacturers that have fiscal year ends in March and the final pay dollars, were apparently on some of these models, like way too good to pass up. And so dealers are buying these cars into their local loaner and rental inventory, I'll take them off, right would be I could have a part to play in the difference between you know what actual new cars are retailed or not. So you know, we'll watch out for those numbers. I still think that March just overall, just from everything the sentiment that I'm hearing was a rockin month. Yeah.

Paul J Daly: 1:48

Oh, I think it was I think it was hey, like we can't bury the lead story here. You probably saw it if you get our daily email if you don't get it. You should go to a soda.com Get the daily email it's so much fun but today we announce that we have locked for our urine extravaganza, a special guest host Kyle the one and only Elon

Kyle Mountsier: 2:05

Musk he's come in some day where it's April in the year end some year

Paul J Daly: 2:14

I'm terrible I Fool's jokes just because we can't even

Kyle Mountsier: 2:18

be so disappointed and I know

Paul J Daly: 2:20

well if you read the email I think the email this year is a very good good tidy bounce know Elon Musk Well, who knows? Who knows actually maybe we gave ourselves till December to figure it out let's just start doing that question we don't they don't they in the in the on the Internet somewhere. Don't they call that manifesting just saying something? Yeah, it happens.

Kyle Mountsier: 2:38

I don't think that's our vibe man. So

Paul J Daly: 2:39

how it works out Dave Meltzer says it works either No, but we won't be having Elon Musk. But what we will be having is a soda con no April Fool's joke. Here, we are like 45 days away from a soda con 4647 in the 40s, may 15, and 16th. In Baltimore, go to ASOTU con.com. And check out just click on speakers. And look at the 50 Plus speakers. These are no slouches. These are very innovative dealers, industry partners, practitioners, sharing their best practices in a variety of sessions and workshops, go to agenda, click agenda by stage or agenda by day and just look through the practical things you're going to be learning whether it comes to running a mobile service department, marketing in a cookieless future, it comes to which sales methods are working best and how can you implement better practices in your store? BDC conversations, culture conversations, community conversations, and a very special keynote guest. I'll tell you about the keynote, the

Kyle Mountsier: 3:40

keynote we have two more keynote guests. The first night will be ending with Brian benstock with a hold on your butt's just ready to go. He's fired up like what I'm pumped about his every time I hear him now he's like he's just fired up, which I guess that's kind of like Brian benstock. Oh, natural, right. And then second night ending the entire thing is well, there are the author of unreasonable hospitality. We got to have him on like a almost hour long podcast last week, can't wait to release that because he's just as good if not better in person than the book or anything. Crazy. We've watched.

Paul J Daly: 4:21

He is he's very contextual with his conversation. I think we're really seeing that this week. So if you don't follow us on LinkedIn, it's a great place to follow us. We have a lot of conversations there. Post a lot of content just follow us. So do more than cars search it up. It'll show up. And then you also have the podcasts and all that stuff. But hey, let's get into some news. Should we get to it, shall we maybe I should say, in a decisive stance against ecommerce giant Amazon and competing OEMs like Hyundai Toyota President Jack Hollis has voiced a resolute no to selling cars on the Amazon platform at the recent automotive forum in New York last week. We were there we didn't catch this session now bummed about it. So basically, he He emphasized the risk of bypassing their established dealership network and program. I hear the crowd applause there was applause when he said this. And he called it a completely divergent path to go to Amazon and advocating for more direct engagement with the dealerships. So they rolled out, obviously their platform smartpath in 2019, and are working very hand in hand to make everything seamless. So it's smartpath with 302 monogram with Lexus. And, you know, they say we're still developing this. We're safeguarding customer privacy by doing this. And he also said, and he quotes for us to take the dealers input and provide it so they have a tool to make seem seamless for you, the customer that to me, we are all in on so a couple shots fired in that one, that well that's the

Kyle Mountsier: 5:46

trick here is that it's not like they have said no, we just don't want that type of purchase behavior, that type of interaction, and they desire that they just see a different path forward. Now they've spent billions of dollars on smart path and smart Pest Service and monogram, so that's probably one reason, right, don't want to shelve that type of product. But the other reason is, I think that they get a lot better ability to have the dealer you know, relationship integral into the technology process that the customers is is a part of, so we'll see if they can get more broad adoption on that as they as they start to, you know, refine that process. But hey, look, massive applause everybody standing Oh, all the OEMs go and see Toyota is doing it. I mean, can we just say

Paul J Daly: 6:36

I know well, we love you Jack Well, Jose Munoz was also on stage not at the same time but with a completely obviously different sentiment and others talking about the you know, the Amazon purchase experience on for Hyundai has been live for employees and they've had you know, a number of transactions and he said they've gone super well and everyone's happy. Also a very different sentiment just in general around Jack Hollis and Jose Munoz is really story of like two different paths in the automotive world. And you know, in the end, we'll see we'll see who wins who loses who does good who does bad not that has to be win lose. But just everyone kind of chooses their path no pun intended and go store Oh, speaking of choosing your path. Segue. So inventory has been a super hot topic over the last three or four years and questions still looming whether OEMs can learn from more stringent inventory levels or whether the flush robust inventory levels of 2019 shall return. new vehicle inventory last month reached 2.8 million vehicles which would be equated 78 day supply. According to Cox automotive up 1 million vehicles for where it was last year. Tight inventories during the pandemic obviously led to a significant increase in profits. And despite the potential benefits of Lean inventory management factors like dealer competition, manufacturing over capacity, they suggest that the success may be hard to replicate. And we might be going back to where we were we'll see JD Power analysts reveals a direct correlation between inventory levels and dealer margins highlighting profitability of operating with lower inventories. Here's a quote from Tyson Germany, we got to catch up with him at the show last week. He said we've learned as an industry during the pandemic that we can operate at lower inventory levels. So he says we've learned we can operate that way.

Kyle Mountsier: 8:27

That's the thing. That's that's what I don't think we've talked a little bit about this inventory thing. And I think that that's what we forget, is we have learned that we can do it. And and, you know, like the article actually says that there's kind of this like difference between an intentional or unintentional scientific approach to inventory management. And we kind of had the unintentional approach to a very scientific like a need to do it. Inventory Management, and now like we are, are not reaping the benefits as much on that you see things like for dramatically reducing the price of the maki in order to start to drive down the inventory levels and the day supply last month. They were successful, but it was still a change in the incentives on a vehicle. And then you see like, most recently, the model why Tesla raises prices again. So they're not having inventory levels. And so I just man, it's my target as you're working with your OEMs if you're a dealer or you're in the OEM seat, like figuring out as a dealer how to compete without inventory because that's one of the like, that's one of the questions is can a dealer have competitive advantage over the dealer down the street? You know, when they have less inventory? Exactly.

Paul J Daly: 9:48

I I think it's crazy, right? Because if the guy down the street has more colors, more trim packages, even if the desire and they have the one you want. I think it's very nearby possible for dealers to compete, I think this has to be regulated in tight partnership with the OEMs. But it kind of goes like this, you know, when people do the thing where they're like, Hey, I'm gonna narrow my, you know, my clothes closet, my wardrobe down to 30 pieces of clothing. Right? All in? Yep, you can do it. And you find out, you're like, I guess I can do it. Right. But the second, you don't have to do it, you know, the other option is nice. And then the other option is nice. And I think it's just human nature. We were saying this back in the day, we're like, I don't think we're gonna stay here. It's just I think there are too many coordinating pieces that all have to agree to do it at the same time. And there's always going to be the one that's like, Nah, we're gonna put some more inventory. I don't know. We'll see. But we've learned we can do it. But will we do it? I guess is the question. We can. But Willie, I could work out every day.

Kyle Mountsier: 10:51

Speaking of everybody doing the same thing at the same time,

Paul J Daly: 10:55

segue time.

Kyle Mountsier: 10:59

Now with over 1.2 billion users only 20 years ago, Gmail actually burst onto the scene, only 20 only 20 burst onto the scene with an unbelievable offer, get this the original offer on April 1, which was then also get it April Fool's Day. Gmail burst on the scene saying they were going to offer a massive, one gigabyte of free storage, a whole game. These days, it was up from the typical typical 15 kilobytes of, of free storage, it was other email tools. And so despite its massive success, Google is now facing kind of a turn of the tides of communication platforms in daily communication. With slack things like Slack and WhatsApp taking precedence. They obviously have upgraded a lot over the years with search themes, smart replies. However, its essence is basically the same and even its layout and format are essentially the same. The The other key to Gmail and what gmail you means for users is it's also the access point for a ton of their services, including things like Slack, as it is a as it's used as a single sign on option. A quote from Ilya Brown, Google's VP of Gmail said, we definitely recognize that Gmail is almost like an identity. It's almost like it's a representative of you in the outside world. How do we help identity to evolve with Gmail users over time? We don't have a solution yet, but we've been thinking about it. Yeah. Interesting that like, that's the move. It's like from email to identity. Yeah,

Paul J Daly: 12:46

I mean, we think about the I mean, your your Gmail account, your Gmail, email, even if you don't use it, is kind of your past key into a lot of different things that your ticket or a lot of things, it brings a lot of ease to your life. It'll be, you know, I think, depending on how efficient and integrated AI gets, that may be a reason to have like the AI integrations with Gmail work with so many other things that it makes it more reasonable to, like use it more leverage and more. But I mean, yeah, 20 years at Gmail makes first of all, just makes me feel older.

Kyle Mountsier: 13:17

Do you remember like, early Gmail, you would have been? Were you in college? Or

Paul J Daly: 13:23

just? No, I was. I was like, I was married. I was married for three years. Gotcha. And I remember,

Kyle Mountsier: 13:32

I'll put myself I was in high school. And I remember the whole like, Do you have any Gmail invitations left? Can Do you have any Gmail invitation sent an

Paul J Daly: 13:40

invitation invited to they run the clubhouse play in the beginning they did was wild. Yeah. Art. I didn't realize they ran that play. Yeah, that can you imagine now leading an invite to a Google thing? Right. It's like every everybody everywhere. All once my first email account was a Juno account. Yes. And I just remember.

Kyle Mountsier: 14:00

And you did you. Yeah, Juno and AOL. And for

Paul J Daly: 14:04

all the kids out there. Back in the day, when you were in college before you could have a phone in every room before you had internet. We had these like 50 foot telephone cable, like literally like the little clicking that you clicked into a phone. And you'd have to run it down the hallway, click it into the hall phone, click it into your computer and you log in and you hear that dude who do right and download your email and upload your email and you never send attachments for crying out loud. That would take all day. But just like texting you download and upload and then you unplug it. So the next person could do it. And then you read your email, and then you answer there was no like clicking on hot links. As crazy

Kyle Mountsier: 14:38

as that is just wild though. Dropbox, storage, Gmail, lots of things changed in 20 years.

Paul J Daly: 14:45

I know hats off to Gmail, though. I mean, where would we be without Gmail? moving the ball forward? Hey, like whatever you do on April 1. This quarter this week this month. We hope that you care about some people. We hope that you run your business more efficiently. We really hope you come to ASOTU CON are calm

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