Dealer Profits Stable, Fleet EV Transition, and Apple’s Beta

Paul J Daly  0:00  
Good morning. It is what day, Thursday. I thought it was Friday. My days are off again. It's october 24 my wife's birthday. Actually talking about dealer profits being stable fleet EV transitions and apples. Beta. Loved good talking about a good beta. You and I are kind of heavy, heavier beta users. I think, yeah, for sure. I mean, it kind of like our role as creators demands it a bit to try it. You got to try it. Yeah, this is this. But this is the first year I've really been a heavy beta user. And yes, and I will say that, I think the worst part of the like, I was really nervous that, like, stuff's not gonna work, right? Every once in a while, little glitch, little restart, but really hardly any. But the one thing that's most disappointing is that when you see the announcement, like, we just announced this, OS, like, the retail stuff, you're like, Oh, awesome. You're like, Oh, I've had this for four months. You

Kyle Mountsier  0:59  
know, what's annoying to me, actually, is because the betas actually, like, kind of reset your phone. They kind of give it like, hey, we'll reset the settings. Try all this again. Yep. Is Like, there are some things that every time the new beta comes out, you gotta go, like, little annoying again. It's all good. It's fine, it's fine. But hey, no, all right, we'll get to that.

Paul J Daly  1:22  
We had an awesome webinar yesterday with them all, from full throttle talking to water free TV. Look,

Kyle Mountsier  1:27  
that was good. Like, I think, I think people maybe just don't understand what's out there and what's available, and the number you are all like, Oh, can I be on can I advertise on Amazon Prime? Can

Paul J Daly  1:39  
I advertise on Netflix. Like, we know the big names, but I had no clue the amount of people that are watching free TV, like logged in, but free TV kind of blew my mind. And all the tracking and the matching back to IP addresses and things like that, like, it's legit. So if you're not sure what free TV is, we're talking about, like the Roku sticks when you turn the TV on, LG being a big player and having a big audience on free Samsung plus, so you can go to asotu.com and just register for the webinar. We did it yesterday, but you'll get the recording so that you can learn a lot from probably one of the smartest people on the topic. And look, the early movers are going to get the best stuff right. Scoop up. Other retailers are but not a lot of automotive, oh, more than cars. Episode Four, we're so excited releasing in just under three weeks from now. We're at Mohawk Chevrolet. This is, I will say, that we probably had, it's such a like a competitive environment that I think we had, like, disproportionate amount of competitive fun on this shoot, and you'll have to watch but there's a trailer online. You can see it on our YouTube channel, on our LinkedIn and, yeah, and there's a LinkedIn event, right? You can sign up so you can watch the premiere. Circle. Is it gonna be one o'clock? I think? Is it one o'clock Eastern? Two o'clock? Yes, no. Ethan giving us the mod one o'clock Eastern, just circle, pencil it in right now. More than cars premiere, November 13, 1pm Eastern, so you can be with us on the live stream while we release it. We can be in the chat in the comments, and it kind of experience it together. It's so much fun. I actually haven't seen the Final Cut yet. Neither have I ready for it. All right, sorry about some news. Yes, yes, yes. Okay, new data. We just funny. You and I mentioned this report. We were spent the week on dealer lots and talking to people. We've mentioned this report like three times so far, new data from the Presidio NCM benchmark shows a sharp drop in dealership profits. That the sharp drop may be starting to level off and stabilize after a tough year, average dealership pre tax profits dropped 30% 30.4% in 2024 but this is an improvement, actually, from earlier declines. Average dealer used vehicle margins are showing improvement, while new vehicle margins are continuing to shrink. Fix ops performance helped offset the declining profitability. Obviously keep has been going real strong. Uh, George careless of Presidio notes. Quote, The improvement is the strongest indicator yet that the retail automotive profit tumble could be stabilizing. When you look at the chart, you see it start level off. You're like, Oh, yep, okay.

Kyle Mountsier  4:17  
Well, what's what's encouraging about this, to me is it's leveling off, still at a higher margin than what we had in 2018, 2019, pre pandemic. And so even though everyone's feeling the impact of margin compression and different supply, especially on the new car side, it like, Don't believe the hype, that it's harder than it once was, like, we still have a better supply and demand situation than we had pre pandemic. Yeah, it's just that, like, when you experience these 140% increases over, you know, at some points you you get used to this weird time, but we're still in a very profitable time as it relates. To the history of automotive according to this report. So I think the news is good, the fact that it's stabilizing, we'll see what happens around election time. We're coming hot into the house, please. Can't come soon enough. Yeah. I mean, there's going to be stuff that, you know, comes and goes, ebbs and flows in that. So it's always something to watch out for every four years. But the stabilization and, you know, things like vehicles becoming a bit more affordable, interest rates coming a little bit more affordable. It's, I think it's going to play a good role in stabilization all the way through 2025,

Paul J Daly  5:31  
you know, I talked to on Tuesday. I was at a dealer round table@cars.com headquarters, talking to a number of dealers. And one dealer specifically was talking about how he's starting to see these boomerang sales people who were with him for a long time. He actually has up to pretty low retention rate, but obviously COVID hit, and then everyone's making a fortune goes. We didn't adjust our pay plans at all. He actually brought in a financial advisor into the store to coach his people on what to do while the money is good, and saying, like, Listen, he's like, just pretty soon you're gonna have to look back to your 2018, 2019, paychecks to be like, that is what? Oh, yeah, right. And, and so. And he said, a lot of them, some, some, maybe not a lot left, you know, looking for greener pastures. And now they're starting to come back and realizing, like, oh, okay, this is the news like that everywhere. And so, yeah, so I think we are coming to that kind of the tail end of the cycle, and maybe this report is a little bit of good news in that direction.

Unknown Speaker  6:31  
Yep, speaking

Paul J Daly  6:32  
of going in

Kyle Mountsier  6:33  
a direction, segue, the direction, actually direction.

Paul J Daly  6:38  
GM and Ford are both rolling out new tools to help fleet operators make a smooth transition to EVs, addressing concerns about cost charging and business impact. GMs. EV starter kit helps identify EV suitable drivers and routes, offering home charging solutions as well for its east which assist is analyzing vehicle uses to suggest which can be like, which vehicles in the fleet can be effectively and efficiently replaced by an EV? So Ford's tool so far is to analyze 38,000 vehicles, finding that half, more than half of them, 53% are actually suitable for EV replacement. GM is offering telematics and OnStar analytics to support their businesses, and this is where you really get a business, right? You give them a cost comparison that's gonna help you make a decision. Here's a quote from Nate McDonald Ford Pro's EV brand manager. He said, quote, Our solutions are aimed at making the transition easier and potentially reducing the total cost of ownership. So

Kyle Mountsier  7:37  
we've been saying forever, right? Yeah, like broken record, ship it into commercial first right there. There's there's already a precedent for, like, every single night, having it in the same place. There's a precedent for tracking and analytics. There's a precedent for telematics. There's a precedent for understanding that vehicles capacity, like all of that in the commercial ecosystem is already baked in, and so now you draft that over to an EV. And especially when you can think about like the you know, it mentions that they're kind of like figuring out, oh, these cars drive this certain amount of mileage, or these trucks drive this certain amount of mileage, they'd be best suited to transition to an EV because, like, they match the mileage ranges and the charging needs and all of that. Yeah, so it makes a ton of sense to kind of, like, analyze and test in that environment where it's controlled, it's understood, how to do There's

Paul J Daly  8:37  
historical data, apples to apples. Yeah, I love it. I mean, we had my first business, we had a big fleet of kind of small vans to, like, normal size vans. And I've been thinking about this, and I've seen some solutions out there where I'm like, Man, Evie would have been such an amazing solution. Does the same route every day. Don't have to stop for gas, like even things like that, right? Every morning, come back, plug it in, ready to go in the morning. So kind of sad that I missed that side of it, but I'm excited so the business side and the fleet side close to my heart, speaking of close to our hearts, stop segway.

Kyle Mountsier  9:12  
Circle back to this one. All right. We got to talk about it. This is honestly one of the most impressive iOS updates in the last like, we'll call it five or six years, but the iOS 18.2 developer beta that has just come out introduces new advanced AI tools and enhancing integration with GPT, extending the capabilities of Apple's ecosystem. So even if you're on the like public beta, and you have the Siri intelligence, you haven't gotten access to this like connection to GPT, that is supposed to revolutionize that feeling. Visual Intelligence also allows users to search using their camera on iPhone 16 models, which is okay, look, that's the one thing where it's like Google did it like eight years ago. Ai powered writing features and expanded read. National Support are part of this release. The GPT integration is set to enhance user interactions, obviously on Apple devices, giving GPT more access and integration with the Siri ecosystem. The Apple intelligence is obviously rolling out in stages, with things like series screen aware actions yet to arrive. So I can't wait for those. Siri's gonna have so much access to. You. Look,

Paul J Daly  10:23  
we had this conversation, Kyle. You were like, you're like, so I was just running the day after, and it just hit me, like, he download the beta. And pretty much, you're like, do you want Siri to have access to everything, everything, and you're running, and you did it. And then the next day you were thinking, like, Is that the right this?

Kyle Mountsier  10:41  
Yep, yep. You know. Who knows?

Paul J Daly  10:43  
We had a fascinating conversation about this last night around the table about all of this, like, where's the data really go? How

Kyle Mountsier  10:50  
tight is it? Do you know? Like, it says that it's only local. But is it really you never know. And one of the biggest things is, like, something to have a lot of fun with. Yeah.

Paul J Daly  10:58  
Well, part of the thing is like, like, can you can it be stopped at this point? Right? Like, someone's going to develop the tech, like, we can regulate it. But you know what it comes down to? And the joke we kept making was like, but can it help us answer our leads? That's like, the problem that no amount of art until our AI can solve is just like getting 100% of responded to and communicated, 20% response rate on all the leads. And like, the only solution that typically is like, I need more leads, right? No, right, no, no, that's not true. So I don't know whatever you're into today, we're hoping to respond in the leads download the beta. Have a little bit of fun. But aside from the tech, aside from the leads, aside from the beta, we have one thing we can do every day, all day, and that is Take care of the people we'll see here tomorrow. You

Transcribed by https://otter.ai

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