Ford CFOs ‘Worry’, EV Charging Alliance, Starbucks Hits Hollywood

Paul J Daly: 0:11

Welcome to Wednesday, it is June 12 12. Yes, dozen days into June. Today we're talking about why Ford CFO said he's worried. Evie charging the lines. And Starbucks is hitting Hollywood. I mean, the people really weren't already in Hollywood, but different kind of way different kind of way.

‍Kyle Mountsier: 0:31

Less activation, the more you know.

Paul J Daly: 0:34

Yeah, more more spending a lot of money. A lot of money. Well, hopefully they fit them. If it's a money making venture, we'll talk about it. I'm sure it is something like that. Something like that. So it's been a weird start to the week. I feel like there's like, No, I just feel like the tone, maybe not wise, very, like mellow, not mellow, but like, monotone to me.

Kyle Mountsier: 1:00

Interesting. You know, I think like in the soda world,

Paul J Daly: 1:03

we go through these like phases. That's exactly why a second bottle

Kyle Mountsier: 1:07

or like we're in kind of like, we're in like, second or third gear right now. Like we live kind of the world, we live the world of like being in fourth or fifth gear.

Paul J Daly: 1:16

1000 RPMs, right. We're like in fifth

Kyle Mountsier: 1:19

gear, redlining most of the time, and we like back to like, second and third. And we can't right now. And so that's

Paul J Daly: 1:26

that's yeah, it was like it's it is it's kind of a time of retooling. We have some fun announcements coming up about the NADA show. And what's going to be going on there. We can't wait. By the way, if you want to partner with us for the NADA show. Last year was a ride last two years. We're going to have something for you soon. Yeah, that's going on more than cars is kind of like in this in this like simmering mode. Like we're moving a few things around. And we're trying to get retooled for that. Yeah, I guess that's probably why I mean, yesterday, there were some stuff like you know, Hague's letter to you know, open letter to Tesla, like that was that was kind of a thing and people talking about it. And they did a great job with the letter started some great conversations. I think I'll actually I think we're not covering the story. But the the Elon Musk pay package voters today?

Unknown: 2:08

Oh, that's

Kyle Mountsier: 2:10

an interesting one. Yeah. If you don't know what's going on, basically, the government is saying like, no, the board couldn't have given him that sort of pay package. And

Paul J Daly: 2:21

yeah, it was like a 55 billion. I mean, it's a lot of money. It's a lot of money, but over a lot of years, and it was tied to actual performance, right benchmarks that were hit. And so apparently, he came out yesterday and said that 90% of retail investors voted in favor of giving him the pay package. And so it's like the big institutional investors own about 40% of the company. So there are enough retail investors to like, push it through. But you know, who knows? I don't know, that's not even a story. Not even a story. It's a story. It's not even a story of the show, or just thanks for pondering these things. Why are we falling asleep? We do have a webinar coming up on June 26. With our friends at activator. This is our quick shot a soda wedge webinar 20 to 30 minutes tops, Kyle and I will be there we moderate our way through it. We're talking about reawakening your dealership talking about understanding shifts in community customer behavior, how to leverage your own data to do that, how to build trust, in customer focused marketing by using your own data. It's a whole thing. If you want to learn something, like show up for 2030 minutes in the middle of the day. 2pm all depending on where you are 2pm June 26. You can sign up for free at our website. ASOTU con.com.

Unknown: 3:31

Let's go yeah, let's get into

Paul J Daly: 3:34

it. All right. So this is a it's kind of something that everyone's feeling already and but now it's interesting, the Ford CFO John Lawler has expressed concerns about rising inventory levels across the industry, emphasizing the need for careful monitoring of supply and demand. So basically, he said Ford's dealers aim their goal is that Ford dealers have a 50 to 60 day supply on the ground. He said excess supply is going to hurt pricing. Though Ford hasn't yet been affected. We've seen some other OEMs as the Lantis note have a large day supply, pricing is being affected. So he says this is a quote from the Ford CFO, John Lawler. It worries me that the stock is building, one of the pitfalls you can run into if you're pushing product that there isn't necessarily what the consumer wants. It's really tough to move. This is fun. Within Ford, we call these ones those ones with pink polka dots. That's what they say if it's not spec, right. Oh, that one's got pink polka dots. It's great. It hasn't been a contagion on us yet. We're still seeing strength primarily because so much of our product is new. So right now the industry average day supply at total is 6076 days at the start of May. So we'll see what I mean should have data on June pretty soon. And notable Lawler is transitioning to vice chair next year to focus more on strategic initiatives while Sherry house will replace him as CFO.

Kyle Mountsier: 4:56

Yeah. You know, tell me something I didn't know, Mr. Lawler. But he said it. Yeah, I am surprised he said it, especially with some of the domestic brands having the most trouble when it comes to inventory and day supply, you know, with with some OEMs carrying 2030 day supply, even arguing that your brand should have a 50 to 60 day supply of new car inventory is aggressive. Like, I mean, so many this is what's so weird to me that in new cars, we feel like there is like kind of a standard to be okay with in that 60 days supply range. Yet so many dealers are on a 30 day supply or less in used cars, like you're saying that profitability and use cars comes from somewhere in that 20 to 25 day supply. Yep. And, and some people even have like 30 Day cuts on on inventory just to manage maintain that. But then on new cars are like yeah, no, we can be a little bit laxed on it. And that'll help profitability. Yeah, I

Paul J Daly: 6:02

think on new cars. I think part of it is that like when people buy a new car, they expect to get the package they want more sure use car. Yep. Right. So I think there's an argument to have a little more variety just in the US, right? It's our culture that you want to buy it, you want to drive it home right away, as opposed to like Europe, or during COVID times. When it was like, well, I'll take the one they have, or I'll wait for it. We don't like to wait. And you know, I think I think you know, Ray Charles could have seen that inventory was coming back back into COVID. Time, but everybody was hopeful.

Kyle Mountsier: 6:32

Yeah, I mean, well, the other thing about this, and I think this is where dealers and even some tech partners in the industry, and actually I a birdie told me that Ford is actually working on this at leveraging the combined inventory within the US to make sure that your day supply stays low is super important. Actually, one of the gentlemen that's now on board at Morgan, he's he's running a lot of their tech stuff. I met him at dmsc last week. And one of the things that he's looking at is, how do we look at our inbound stock as compared to the stock sitting at other dealers and basically merge those as our available inventory. And leverage each to make sure that we have pace on the, you know, a piece on our wholesale numbers so that we're getting the right inventory, but also that we recognize, hey, if the inventory is in the market, we have access to it, we just have to leverage other pieces of our inventory to get access to that. And I think that if as an industry, we can figure that out, we can actually reduce a supply across the

Paul J Daly: 7:43

board. Yeah, without a doubt. I mean, that means if you do that, I think dealers are like you're always worried about that competitive edge of having the right car. Sure. Right. But at the same time, like control over the right cars is feels like it's more uncertain than ever. And like dealers that have a strong other value propositions, like their marketing, their experience, their brand reputation, don't have to worry about that as much, right? Because people are like, I want to buy your iPod, right, which builds the case for brand. You know, doing new things. Speaking of this is a great segue. You're talking about collaborating, speaking and collaborating is a good one. We covered this story when it first kind of broke it was like a year year and a half ago, but Ayana I O N N A, an Eevee charging joint venture by seven US automakers. So it's BMW, GM, Honda, Hyundai, Kia, Mercedes and still Lantis have announced their headquarters will be in Durham, North Carolina right by our friends at reunion are close there and is expanding his leadership team to support the ambitious goal including adding executives formerly working for Evie connect massive charging network rivian lucid. Their headquarters is going to be Durham, North Carolina with a central lab connecting to interoperability and Customer Experience Center. So like everything's gonna be in one place. So his goal together is to install 30,000 chargers are going to hit it. Oh, wrong one.

Kyle Mountsier: 9:05

Close, you're close. I was back

Paul J Daly: 9:10

there plans to install over 30,000 charges by the year 2030, which is about 6000 a year if you can do basic math as a note right the most chargers ever installed in the year by the undisputed charging infrastructure leader Tesla. They've only installed a maximum of 4000 per year so we'll see if they can wow crease that by 50% is going to support all the standards and ACS NCCS. And this is cool each each station will have amenities restrooms, food service retail stores. Okay. So here's, here's a quote from I think this is the CEO. I didn't put it in here. Mr. Sumati. I think he's the CEO. He said the network in the US if you compare it to other parts of the world clearly needs work. It needs Ayana. And unlike this, it needs a lot more eye on us. So he's like not just us, but he's a lot Are people like us doing the same thing?

Kyle Mountsier: 10:01

It does. I think that that's the whole piece that we have to figure out right now. Right? Like, I mean, if you just look at gas stations and the number of contributors to the gas station network that is way more than what we have in the charging network, like no one company can own the entire grid. And, and so yeah, more of these have to pop up. I love like, the key thing for me here is is that there's a lab that also is going to be connected to customer experience centers, because they're going to do real world user data testing. They're thinking about how stations relate to what you do every single day. So restrooms foodservice retail stores, it's like, Oh, great. So we're gonna make gas stations, but just on a larger scale. What it has to happen because until we get to a 10 minute charging situation, you need something to do while your vehicle is charging for at minimum 30 minutes on on a supercharger. Right.

Paul J Daly: 10:57

Yeah, so I like it. I like it. I like the collaboration. I like that it's gonna be in North Carolina. I like that. They're thinking retail. It's good speaking, thinking retail. Segue.

Kyle Mountsier: 11:08

This one's close to our hearts. This is, you know, you know how we do stuff? Because not because you like Starbucks coffee? No, no, no, not because I like Starbucks. But because of what they're doing. Starbucks has announced the launch of Starbucks studios, marking its entry into the guests what film industry as it follows the trends of brands venturing into production. We know we know a brand that's doing that. Christy Kane, the Vice President of brand and partnerships, marketing at Starbucks, emphasizing the statement that Starbucks Studios is focused on producing content that fosters human connection, and joy. Man, I don't know like, Can we get a more than cars bumper here somehow? So Starbucks is partnering with sugar 23, founded by Academy Award winning producer Michael Sugar said ever have oh, it's absolutely good. Who said about the partnership and, and and the story. He said storytelling is deeply ingrained in what Starbucks does. And Starbucks Studios is a natural extension of these efforts. Together, we will harness the power of storytelling to foster connections, inspire, change, build a stronger sense of community. He said, we're excited to work alongside that the incredible Starbucks team and invite all of our collaborators in Hollywood and beyond to join us in creating premium entertainment.

Paul J Daly: 12:25

They go like another another example of a brand understanding what they need to do to contribute to community contribute to the feeling that they're trying to generate when people consider their brand or their industry, which is exactly the reason that we produce more than cars. And we're trying to get more dealers, more associations on board with doing this. Look, Starbucks knows what they're doing when it comes to ingratiating themselves with culture as an industry. We have plenty, plenty of community stories, we have plenty of stories of joy and progress and, you know, turnaround

Kyle Mountsier: 12:59

stories that could like I don't know, foster connections, inspire, change and build a stronger sense of Oh, pull

Paul J Daly: 13:05

that Starbucks quote something about that. I don't know. We think it's a good idea. We hope you think it's a good idea. Look, if you're wondering what we're talking about, just go to more than cars.tv more than cars.tv. There's a couple of Docu series that we produced that might have done this stuff. We hope you join them, watch them take care of one another. We will see you here tomorrow.

‍