ASOTU Stranded, Trade Convos in Service, Rate Cut, and Pumpkin Spice

Paul J Daly: 0:06

Yo. It has been a wild week. It's Friday. Soda is straight up stranded. We'll tell you all about that the second. We're also talking about trade conversations in the service lane, rate cuts potential. And I don't want to say about pumpkin spice. Oh, I know I had to say it.

‍Kyle Mountsier: 0:24

I was gonna, I was gonna be halfway happy the entire show until that like I was hoping to not have to think about that for another three and a half minutes. At least.

Paul J Daly: 0:34

No no no. So we spent tell the story. We spent our week on the ground with dealers, OEMs, industry partners, and we were Reynolds and Reynolds event, we were at the name at event in Miami. You got out last night. There was some weather. There was a big mess up. Nathan and I, our flight got delayed, so we couldn't make our connection. So we switched flight from Miami. We ended up taking a car, driving it to Orlando. I rented a car from Avis, and it was a Mitsubishi Outlander. We have more about that. Just wow. Let me just say, Wow, there and, and, dude, I get home restricted. Yeah, I

Kyle Mountsier: 1:12

get home my my Wi Fi is completely down. Comcast cannot come out for another week. They're so backed up. So

Paul J Daly: 1:19

you're at home, but I'm at a coffee shop living outside as well. We're both doing the outside. We're slumming it here. We're what a man found a little spot.

Kyle Mountsier: 1:32

Oh, look. Oh yeah, you're slumming it. You're

Paul J Daly: 1:33

just having such a hard time. Dave in Orlando, there's Nathan producing the show. All right, you might get out of here now. And so we finally, we drove three and a half hours from Miami to Orlando, and we were able to book a flight from Orlando. All the flights into Syracuse are booked because it's everybody's going back to su this weekend. Oh, literally, that's what it is. We figured it out. Finally, you cannot get into Syracuse today at all if you're trying to fly there. So we're taking Spirit Airlines. First time ever on spirit to Rochester, which is an hour and a half away. My wife's gonna drive out and pick us up, so we get to ride the big banana boat in the sky. Is what I call it, dude. I'm

Kyle Mountsier: 2:09

telling you what. I've been on a spirit flight from Nashville to Vegas, and that is, like, you know, your body experiences something different in that cardboard.

Paul J Daly: 2:19

So my body felt like experienced something different than the Outlander on that three and a half hour trip.

Kyle Mountsier: 2:24

So at least you had a little padding, like you're you're about to jump in a Recaro, like racing seat for three hours, hours. Yeah, yeah, it's gonna be intense.

Paul J Daly: 2:34

I'll tell you, it's gonna be good, but I'll tell you what, a lot of people in the industry understand, what it's like to get stranded when we travel. But it's part of the reward, the reward is being with the amazing people in this industry, and boy, do we have some great stories and content to share from our time on the ground this week, but today, there'll be more coming out for that. Again, one more. Thank you to our friends at TrueCar plus for making it so that we could come out to the name at event, get so many of the good things that are happening in that community, out to the rest of the industry. Couldn't do without you. We have some more content coming, because you allowed us to do that soon. So thank you to Matt Jones and the team at TrueCar plus for letting us do that, allowing us to do that. But we still do have some news. We have a job to do today.

Kyle Mountsier: 3:15

Kyle, yeah, real quick, real quick before we get to that. Because, you know, people, some people wonder, like, Why do you get in Why do you get in person for events? And so last yesterday, Jimmy Douglas and Igor skinder are on LinkedIn talking about how they got connected two years ago at or, I think actually a year ago, oh, I know, con, right? And so they're, they're getting connected there, right? The things that they've done even since then, Winnie Gore was with VW, and now he, you know, he's left and doing his own thing, and then what plug has been able to do since then. And then yesterday, we're like, rolling out of Neymar, and these two people come storming up to us, right? And we get connected to two of the most dynamic New Dealers, only four months as husband, wife owners, husband, wife, super dynamic. And

Paul J Daly: 4:11

can we get turned car dealer?

Kyle Mountsier: 4:14

Then we get to interview them. We can't wait to release that so we get connected other people get to connected. Like I know that people see us around at these events, they wonder, why? What's the, you know, what's the purpose of being away from a store, being away from a company or or, like, the connections that you make are literally almost impossible if you don't have that in person thing. So, like, they, yeah, getting, getting to one or two of these a year. I just think, I just don't know why everybody isn't at least leaning into, like, one or two events. You don't have to go to all of them, but just a couple. And

Paul J Daly: 4:48

if you need help convincing your boss to send you, you send them our way, and we'll, we'll spend a little time with them. We hope that one event, if you can go to one, is a soda con that's in May. You got plenty of time to plan for it. It's in May. Uh, the week after Mother's Day, you can go to asotu con.com, sign up there, and, uh, boy, is it going to be a thing this year. Let's get into some movies. Let's go. It's kind of, it's kind of light, lightish news, but great conversation around this, a new survey has revealed that most dealerships aren't leveraging the service drive as a source of quality use vehicles by discussing trade in options with service customers. 60% of mass market customers were not asked about their vehicles. Trade in value during their service visit, and 61% from luxury customers, which is probably even the bigger surprise, only 24% of mass market and 23% of luxury customers had trade in conversations at all. Damon John the Shark Tank shark was on the stage basically. He said there are three ways you can interact with customers. This was one of the keynotes yesterday. He said, you can acquire a customer. You can upsell a customer, or this is where this comes in. You can make them buy more frequently.

Kyle Mountsier: 6:00

Yep, I'll never forget. Man, this was like early covid And and I had been working on this at the stores that I was at for quite some time, just like figuring out how to go from service to sales and back to service and make that just like a repeat thing, where every three years. And I heard Brian benstock, and I'm sure someone said it before, but he said the words trade and cycle management as a way to increase market share. And you know the philosophy that he has in his stories, every single person gets a value every single time they get in service, and they get a real introduction to a real person that's interested in buying their car, and that's what yields him the four or 5% return on every ro it back into the sales department every single month. And if you, if you look at four or 5% over 36 months, you get over 100% retention in under three years. Like the math just works. You just have to put in the work, and you have to do it every single time, every customer absolutely

Paul J Daly: 7:00

you know, we had a we had a great dinner with Liza borches And Danny zazlovsky and Glenn Lundy. And Glenn who many people know, has just opened his very first store, this used car store called 800% elite auto, said he's trying to calibrate his team when it comes to someone coming in with a trade or having a trade conversation, of someone that walks in the door and he was like, we need to recalibrate. We're not in the business of selling cars. We're in the business of acquiring customers. And even if that's a trade lane conversation, right? You're you're acquiring a customer for the second time. Is how I throw that. So there you go. Go into the weekend with a little bit of that in your brain, because that's going to help. That's going to work. Speaking of things that may or may not work, I don't know. Whoa,

Kyle Mountsier: 7:45

okay,

Paul J Daly: 7:47

segway, I know it's hard when I'm not triggering it, but Nathan's doing a great job over there. He's actually sipping on my tie the Fed. The Fed is widely expected to cut interest rates soon, but the big question is how much relief will come Fed Chair Jerome Powell will address inflation and potential rate cuts in his upcoming speech in Jackson. Hole Wyoming today, the Fed has kept rates high since 2022 trying to keep inflation in check, but the market is anticipating a rate cut in September, with a good chance for a 25 basis point cut, or point two 5% and a smaller chance of maybe half a percent. He remains data driven, cautioning against cutting rates too soon to avoid like inflation raring back up. You got to make sure the fire's out right. We don't want to put any any fuel in the fire. The Fed's Austin Goolsby said, quote, This is not what an overheating economy looks like, signaling a shift in the economic conditions. Yeah, this

Kyle Mountsier: 8:43

is, I mean, on all the people rejoiced, right? There hasn't been much. You know, we saw the change in the jobs report earlier this week. There wasn't much, really market reaction. I think everybody kind of expected that adjustment. And so then you see coming on the heels of that, the potential for up to three, three and a half percent in under 18 months. Reduction in rate that gets us back into a really, really healthy place. It's not too light on interest rates, but also not too heavy. You know, a lot of dealer groups and dealerships have been recognizing how rates are impacting their rental and their and their mortgage factors, because most, most of these are not on yet a variable

Paul J Daly: 9:27

rate, right? Exactly. So New Dealers Exactly. So

Kyle Mountsier: 9:32

I think that this is, this is welcome news for dealers. It's welcome news for consumers. And I have a sneaking suspicion that as we get into spring of next year, normal, you know, inventories normalized even more, and then we get into a place where we've got great interest rates on these vehicles, probably you're going to see, on the heels of rate drops, manufacturers getting back into more regular, 1.9 point 9% aprs and. And you're going to see another bump in the economy as we head into spring, which is going to go really great. Well, let's

Paul J Daly: 10:04

let's hope so. Speaking of heading into spring, fall segway, while we still have a month of summer left,

Kyle Mountsier: 10:13

season's changing. I'm telling you what. Actually, it felt more like fall in Miami than it did in Knoxville today.

Paul J Daly: 10:20

I'll tell you, it was crazy, yeah, but

Kyle Mountsier: 10:23

can't even believe I have to read this story. Paul, the ever divisive, divisive by me, particularly, pumpkin spice latte is back, arriving earlier this year, ever earlier than ever this year, and it is releasing its fall menu yesterday, sparking both yes joy and yes outrage. The Pumpkin Spice Latte has been a fall favorite since its debut in 2003 with 20 million crazy people buying them annually. Social media is buzzing with excitement and frustration, obviously over the early release 2022, study showed that 55% of online pumpkin spice posts are positive with 8% negative.

Paul J Daly: 11:03

Okay, well, I'm not a huge pumpkin spice fan, especially not from Starbucks. No. Hate. It's just that it's, you know, it's not the authentic pumpkin spice. And I was so put out when we were at used car week last year, and I walked in and the temperature like it was, like it is right now. And this was probably because it was a little warmer and there was pumpkin spice and cream. Pumpkin spice and Christmas stuff out. It just all feels wrong to me. This is just even making it worse. The fact that pumpkin spice is going, it's August 23 Kyle, it is August 23 in New York. No one's even back to school yet. Like, there's pool parties. Like, I don't know, I'm not a fan. So if you're a dealer, I do not suggest that you jump on the pumpkin spice bandwagon yet. Please don't save it, though, because the second the air starts to get crisp, start thinking about how you can rock on some pumpkin spice. Put those burnt orange cars out front. That's right. Grab yourself a big like salt shaker, fill it with pumpkin spice and make them make a spectacle. Yeah. Look, if you've

Kyle Mountsier: 12:02

got 20 million sold annually, and the social media is buzzing about it, why not create content around it? Why not be a part of that? I see how you feel out there. You

Paul J Daly: 12:10

got, you got a hunker. They're just, it's just a fan. I

Kyle Mountsier: 12:12

got a hunker. That's it. They're, they're a fan of pumpkin spice. Uh, yeah. But I mean, why not lean into it? It's a cultural moment that anybody can take advantage of. That's why we talk about these things. This is a cultural moment that your store can actually take advantage of. Why not even today make fun of it. Go, go down. Get your a whole store, a bunch a bunch of pumpkin spice lattes. Create some social media content, ice, yeah. I mean, this is, this is a way to swim in the river, just like, drop it in the river and live with the culture, and it allows you to be culturally relevant and gain attention.

Paul J Daly: 12:47

All right, we have to get the comments today. We don't usually do this, but there's so many live streams. I think, I think it's the headline that that we wrote. So do stranded, if you were like, what's going on? Joshua org, comment on pumpkin spice. Haha. My wife sent me a pic of her pumpkin. Frap yesterday. Damien Boudreau just gives us a laughing emoji. Beth Carol. Carol, our friend said Miami was a tough one to get out of. We dealt with a four hour delay. Got home yesterday at 2am safe travels. Glad you got home. A LinkedIn user gave us clappy hands. Doug Classen, a regular on the show, says, Good luck on spirit, that's a one and done experience. Roll the outro music, if we can. And our one and on, Jordan Cox says, I'm just here for the NSYNC tickets. I think he's making fun of our sunglasses today. Go out there. Size of cars. Love some people drink some pumpkin spice, if you dare the

Unknown: 13:42

match.

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