Time for Business

We know Lithia & Driveway aren’t ALL dealerships, but they are a publicly reported set of dealerships, so seeing their numbers is a thermometer under the tongue of the US industry in some ways.

We seem to have caught the market in a down moment today, but the only constant is change over there on Wall Street, so don’t take it personally.

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Dealership Vibes

Lithia & Driveway marked a historic high, with its fourth-quarter 2023 revenue reaching $7.7 billion, up 10% from the previous year.

• Net income, however, dipped by 13% to $216M, with earnings per share slipping 14% to $7.74

Franchise Dealers' service lanes saw an increase in January. Repair Order Volume increased 2.7% from December but was down 1.3% compared to January 2023.

• Repair Order Revenue climbed 3.3% over December and 4.3% year over year.

Wholesale values dipped about 0.9% since January and are down 13.8% year over year.

• Wholesale supply stands at 27 days. Higher than last year but below 2019 levels.
• Despite this, auction unit sales have increased about 9% YOY in January.
• Prices across vehicle types have declined by double digits with EVs losing 16.1% while non-EVs lost an average of 12.8%.

📉 At the time of writing, Lithia Motors Inc. is down 0.60% in the market.

Vending Machine Deliveries

Carvana has introduced same-day vehicle delivery in Sacramento, doubling down on the convenience of online car buying and selling. Local customers will receive their vehicles within hours of purchase. Private sellers will have drop-off options too, so there is a chance this marketplace expansion will draw private sellers away from buy centers and into Carvana's orbit.

📉 At the time of writing, Carvana Co is down 5.08% in the market.

Toyota's Investments

Toyota is making significant investments in their future, but maybe not ALL the investments they could make in the future.

The company is pumping $1.3B into Kentucky for the production of its new SU-EV (SUV + EV) as part of its shift toward sustainable transportation. It's part of a $17B investment plan in US electrification within their philosophy of "building where they sell."

However, the company has put wage negotiations in Japan on hold. Toyota wants to secure the talent for its ambitious global and future plans, and the labor union wants to secure the compensation those talented folks need. Here's hoping all parties return to the table in good faith soon.

📉 At the time of writing, Toyota Motor Corp is down 0.20% in the market.

Ford's Price Cuts

Ford is snipping the price of the 2023 Mach-E as the "make EVs profitable" campaign continues across the world's brands.

• With cuts up to $8K, some Mach-Es are available under $40K now.
• The adjustment places the Mach-E in a better position to compete with Tesla amid slowing demand, but it doesn't do much for the overall pricing question or charging concerns.  

📉 At the time of writing, Ford Motor Co is down 1.01% in the market

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LAD’s reports tell us about retail auto’s today. For example, seeing that Carvana is getting into deliveries tells us something about retail auto’s tomorrow.