3 Big Groups Back Over 30 Day Supply, Smoke Reviews Q1, A Big Lot Of Guerilla Marketing

Paul Daly: 0:00Yo, I think we both just realized that oh, we do have intro music. We do have an airport. hotel room. Today we're talking about the three groups, big groups being back over a 30 day supply, Jonathan smoke and a big life. Guerilla Marketing really cool. little while, whilst as I said the word guerilla marketing, I realized gorillas

‍Kyle Mountsier: 0:23

I feel like I say gorillas anytime I go to Cincinnati because of how rhombi but that's, that's okay.

Paul Daly: 0:29

I get it. I get it. Well,

Kyle Mountsier: 0:31

I don't know if you know, the whole Cincinnati thing.

Paul Daly: 0:33

Not not really down on all the Cincinnati news. But like some of it, maybe every once in a while. We hit a little bit of a milestone last month, which we all like gave ourselves a little hotline, the

Kyle Mountsier: 0:43

virtual Yeah,

Paul Daly: 0:44

last month is the first month we got over 5000 downloads of the podcast in 30 day period. So 5000 people listening or 5000 listens to the show last month. So hey, thank you for being here. Thank you for giving us a little bit of your time. Hopefully, we give something back to you. Because man, we really work really hard every morning to bring this show to you. As you can see, from the fact that neither of us are in the studio today

Kyle Mountsier: 1:08

doing it anywhere. Yeah, if you're one of those one, two or three listeners then it's it is it's our our pleasure and honor to have you hanging out with us in the mornings or in the afternoons wherever you listen and just Thanks for Thanks for sharing it out and being a part of the community.

Paul Daly: 1:24

That's a good point. If you're not listening, or if you're not watching a Kyle's in an airport, I'm in a hotel thing. We're both on our way converging on Tampa to get real, real rent. And we were ready for the big premiere tomorrow night, Tuesday night. More than cars, the TV show style doc series that we've been doing, man we've gotten through the edits. We've showed family members and friends and boy, are we ready to do this premiere. We're talking red carpet concessions of screening of the show. And you know, like the typical fun that an associate brings to a digital dealer party. And guess what?

Kyle Mountsier: 1:57

Yeah, it's gonna be a full on party. Don't just think you're gonna be sitting there in a theater. We're gonna go full party mode. There's swag. Everybody's there's I've already had like three people ask me, I'm not even coming to Danville, but can I get the swag? So for all of those that are here, for all those that are here, be lucky count yourself lucky that you're getting the swag. So

Paul Daly: 2:17

yeah, yes, he hasn't for you. It'll mean we got some good, good, good first time swag for silver. So if you've been in the crew for a while, you're gonna get something fresh this time because that's how we have to roll. We got to get into some news because Kyle's on the move. I'm on the move, and we got to write to it. So for the first time in over two years, at least three of the major public vehicle retailers reported a 30 plus day supply in new car inventory. Oh my goodness, we might be making it back. Asbury, it's 30 days, up from 10 days a year earlier. And they were at 26 in q4. So they're creeping up Saina kits 31 days, up from 15 days a year earlier, and 24 in q4, and Big Daddy Lithia hit 52 days to fly up from 27. Today we're almost at a 30 day supply a year ago. They were 47 in q4. So Lithia is at 52 Sonic 31 Asbury 30 and the other Publix are also not far behind. Thomas King, president of JD Power data and analytics said in a statement as we look into May, the asymmetrical market positions of each manufacturer meaning like the different positions of like a Toyota, and it's the Lantis. Right, very different, he says, could become even more apparent the brands with higher inventory levels are likely going to start participating in get this Kyle Memorial Day savings. You use that as an example you but you wouldn't believe it.

Kyle Mountsier: 3:40

You wouldn't believe it. Yeah, I look. Here's the thing. I sent

Unknown: 3:44

you videos yesterday, I was rolling past I was in Kentucky rolling past a couple four things. One is they have a whole lot of holding space at a speedway there. And the last time I went by, which was Thanksgiving, packed to the brim couldn't fit another car on that Speedway or the parking lots and and now there was maybe 100 trucks out there. They were waiting for

Kyle Mountsier: 4:12

the series, right? Yeah, so like every manufacturer, and that's going to contribute to every dealer group just having more and more days supply, especially the manufacturers that have the greater day supply that need the wholesalers cars that are waiting on ships that are starting to bring back production. And so we're gonna see that and the new and the use side because then you get a little bit more used car inventory people trend toward new, actually, I was talking to another dealer over the weekend that for the first time ever they had a larger volume of new car sales than used car sales. They're like, Oh, I'm rarely used car franchise dealer right? They just they just do more use Oh, they had a and not just higher, double the number of new cars than Used Cars. Right So it's just like this whole different market. And when you look at these Publix and the rising day supply, we're going to start to see incentives, we're going to start to see price shabby shoppers, you know, people are going to be looking for competitive market. So just be aware of that in the conversations that you're having with consumers right now.

Paul Daly: 5:18

Yeah, well, Lithia CEO, Chris holds, who noted on an earnings call that the volume of vehicles on the ground and the increase in fleet business is indicating a return to broad consumer incentives. So we're back. We're gonna we're gonna be back. Just let's

Kyle Mountsier: 5:33

energy's off trucks. Guys.

Paul Daly: 5:35

We knew it's happening. I appreciate all the optimism. We're pretty optimistic so much. But when this was happening, we're like, yeah, I don't think so. Why? Well, because, you know, publicly traded or OEMs are, you know, benchmarked on vehicles wholesale, not vehicles retail. So here we go. Speaking of we don't have to Mystic guys, I hope this is such an optimistic guy stop. Our friend Jonathan smoke chief economist at Cox automotive broke down the q1 trends regarding movement in new and used car sales in the markets as the markets begin to moderate and some new car buyers who were forced into the used car market because of pricing. While they're now actually starting to move back. Smoke said the retail market is showing clear changes in momentum in March, as new vehicle sales were up 9% year over year and US sales declined 6% year over year, he specifically notice that there are more lower cost new car options on the market that just weren't there a year ago. So he said now use car market. It's the traditional used car market buyers that are left and they're the most challenged in the terms of credit conditions and affordability. And so supply is still down in the US market prices are still high. So he says again another another tailor.

Kyle Mountsier: 6:50

It's so interesting because right now use cars are kind of a trailing indicator of the way that the market is going we're seeing continued use car prices being high a limited amount of inventory. And and because people were holding their used cars longer we're seeing used cars with with higher mileage isn't we ever seen. So people are moving to new cars because the incentives and the pricing is getting closer to the affordability and the availability and the availability is sitting there right. So you're seeing this kind of like weird market where used cars have have yet to to keep up with the new car trajectory. And we really won't see used cars change until all of these fleet vehicles that are headed into rentals start to come out of use car inventory and we see rising, rising wholesales of used cars, especially late model. So it's going to be kind of a weird summer I think when we're looking at the data on on new and used cars.

Paul Daly: 7:42

Oh yeah, for sure. Um, he also indicated and this is something that that you still, I guess that that we saw coming but it's here already that battery electric vehicles are becoming more active participant in the used car market, citing that KBB instant cash offers have increased 144% on EVs year over year. And he also noted that BV sales at dealerships Rose 32% year over year and he's calling EVs and V EVs, the biggest potential growth, biggest potential for growth in 2023. And moving forward. So EVs are now hitting the used car markets, people are starting those cycles. And that's going to

Unknown: 8:24

be a whole other thing, especially with the this question marks around what incentives apply to use vehicles it's going to be, that's that whole market. And the end, just the conversation at the dealership level is still something that most dealerships have only ever, you know, had one, two, maybe a couple and

Paul Daly: 8:41

everyone gathered around it, I checked it out when it came in, everyone wants to drive it once so we can get some experience. But that's a whole Wild West. And then what's it actually worth? And what's the battery at? And like, how are we going to do this thing? We're in for it. But hey, that's why dealers who are the most savvy who pay the most attention, who are the most entrepreneurial tend to come out ahead of these things, because they're not afraid of it. Right. The ones that are buying those making the KBB instant cash offers starting to move in through their dealerships and learn about them have their text learned about them and like they're just going to be the front runners in the next year. Speaking of I would say the front runners but I can't, so we don't Yes. Thank you, you know, even though

Kyle Mountsier: 9:25

don't read the story, don't read the story, but track with the story the story yet. We called this last week we called this next door we didn't there about this. I'm so excited. Read it, read it go.

Paul Daly: 9:40

In one of the best guerilla marketing tactics we've seen in quite a while and if you don't know what guerilla marketing is, you should but if you don't, it's like think of guerrilla warfare. It's not symmetrical. It's like Oh, someone with a lesser force is able to use you know, unconventional tactics to actually get a lot of hold. So do a little education there. So in one of the best grilling Marketing taxes we've seen in a while both Big Lots. And the Container Store will be accepting those 20% off coupons from the now bankrupt. Bed Bath and Beyond car last week, we were like, what about those 20% coupons? Just gonna pick them up, man. Last late last week, Big Lots said they would apply any of those coupons to purchases over $50 through May 7. This is a quote from the CEO of Big Lots, I love him use it as an opportunity to push down the brand. He said Our mission is to help people live big and save lots, which means we're always thinking of ways to step up to deliver even more value to customers. I love it. He bought the mission out and he launched that sucker in there. And the Container Store has taken an even more aggressive approach. And the coupons are good at The Container Store until May 31. So a whole month. And so you know, even though it's not a perfect mix, as far as like what Bed Bath and Beyond carried, and what Big Lots are the containers stored carried, or even the vibe is different in all those stores. But hey, there's enough mix over and shoot PR value alone, right?

Kyle Mountsier: 11:03

It's worth just the PR launch. And here this is what blows my mind is that Big Lots isn't bankrupt. But Bed Bath and Beyond is I don't know how that works. Right?

Paul Daly: 11:14

Hey, man. Big crowded? Well, you look at retailers. I mean, if you think about that, traditionally speaking when you go through times of economic pressure and economic downturn, you know, stores like big locks, Dollar General, they seem to just thrive, right? People are looking for the value, especially when you're carrying name brands. And so that's quite, that's close to our hearts. Not only do we talk about the 20% coupons, I mean, I think some dealers should give them a 20% coupon thing. It could just be like this total mean thing. Like if you have a 20% Bed Bath and Beyond arts, oil changes, like our service, right? Let's do All right, so you can roll that outro Nathan, we're on the ground. We hope to see you in Tampa. If you're going to be there. Come say hi. You can get the tickets to that after party. What is it? What do we call it a screening? asotux.com If not, we'll be talking to you real soon.

Unknown: 12:17

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