Is Nissan The Right Honda Partner?, CA Dealers Push Back on Scout, Overpriced Fast Food

Paul J Daly  0:01  
It is Monday, December 30. A lot of people don't really know what day it is, but we're talking about Honda and Nissan little updates, California suing Scout overpriced fast food, and Kyle and I have near zero inboxes. Ladies and gentlemen, that's probably the biggest news of the day. We just massive. It's funny, we didn't talk a lot last week because the Christmas and holidays and kind of had a more of a fluid work schedule. A lot of people were off, and we just realized that we both kind of like came into the office air quotes on late last week just to manage the months of our inboxes. It

Kyle Mountsier  0:39  
was magical. Nobody was bothering me. No slack. Messages coming in. And it was just like, yep, tick that one off, tick that one off, tick that one off. And it felt so good. I went into the weekend just like,

Paul J Daly  0:51  
you know, how many emails Did you unsubscribe from?

Kyle Mountsier  0:55  
I see I'm pretty good at that. On the normal right. It was like, legit work that had to get done. So I did

Paul J Daly  1:02  
a lot of unsubscribing as well. You know, I kind of the way I subscribe to emails, and I absorb a lot of information just through subject lines. And first, like, paragraphs, a bunch of different fronts. Some are creative fronts. Some are news. Some are right. And so I'm always like, oh. And then eventually I'm like, You know what? I haven't opened or cared about this thing in like, two I haven't done anything. It's gone. It's gone. It's gone. So I don't know, we still got two days left, today, tomorrow, and the end

Kyle Mountsier  1:28  
of the year, I know. I mean, you know what's cool is the few dealers that I have kind of like rubbed shoulders with and texted with the end of the year is doing really good, like people are heads down, and they are selling a lot of cars, servicing a lot of cars, so I'm excited. I think the last two days of this year are going to be roaring for a lot of people. Yeah,

Paul J Daly  1:49  
we got it. We got we got two days left, right. Everybody's on the push. So good. I was just, I was just in a dealership. Had to drop my vehicle off for the first time at a new dealership. And the service advisor actually came from a sales department in another dealership. He went from sales to service advisor, and he said he loves it. He loves it. And they're, they're jamming

Kyle Mountsier  2:09  
over there too. I'm here. We're hearing more of that. We heard that last week on what a podcast, or something like that. And then, yeah, so many people going and then yeah, it's people are figuring out that Services is a jam. There's

Paul J Daly  2:22  
a consistency thing to service that, yes, the sales side of the business just isn't for everyone. You know, right?

Kyle Mountsier  2:28  
Yeah, you have, you have to be willing to put in some work that doesn't feel like work all the time. Yes, and service, you're like always doing something, product, productive for sure. This week

Paul J Daly  2:36  
definitely going to be a little bit of a of a jittery one with, uh, New Year's right in the middle. But we've got some new content for you to listen to if you're looking for podcasts or something to feed your brain with. Give you a little inspiration. Spoke with Carol Marshall with active engage, talking about human connection in data driven auto industry, we had a Carol has just been a great friend for a lot of years. She's, she's always, I mean, she is just a people oriented leader, period, right? Does a lot of data, does a lot of tech. So that's our Auto Collabs podcast. Auto Collabs also big thing. Nada parties.com it's not quite January, but it's about to be January, and the second that happens, all people are focused on are what they're doing at the NADA show, or, like the vast majority of the

Kyle Mountsier  3:21  
industry during after lots of people in the industry gonna be worried about it. We've got 22 parties sitting on nada parties com, from all the way from Wednesday to Saturday evening. So

you get even Wednesday people doing things on Wednesday. Fam. So whatever you What are you? You got going on during the day? We've got you covered for the night time. So check them out. Plan, plan your little journey all the way across New Orleans. And if you haven't signed up for the wait list of our party, do so, because we have a feeling we'll be able to scroll a couple people out don't respond on the last minute. And also, if you are on the current list, just know we're going to be calling you the week before to make sure you're going to be there, because that thing is already sold out and we want is already sold out, and we want to make

Paul J Daly  4:04  
sure we get max capacity. Yeah, and if you don't respond, unfortunately, you're not going to be able to get in. We're at max capacity, but make sure you're on the wait list, because we will be trying our best to get you in, just because. All right, there's been a lot of drama. Actually, it's really strategically over the holidays drama, but Honda CEO, toshira, Mia, what is it? Mimi, I don't know. Maybe

Kyle Mountsier  4:24  
you go for it. EBay. Toshihiro. Toshi hero. EBay. Without that, he faced an awkward

Paul J Daly  4:31  
press moment when asked, here's the question, why would Nisa? Why will Nissan make a good business partner? And he said, That's a difficult one, trying to explain the rationale I feel so bad for the comment violates broader skepticism and questions surrounding the partnership. Basically, Honda, solid hybrid lineup struggles with EV Development After parting ways with GM. Meanwhile, Nissan a lot of financial instability, declining EV market share despite its history as. An early leader with the leaf. You know something about that? Kyle Nissan's robust manufacturing network supply chain could potentially align with Honda's hybrid expertise. Now, Nishan shares went up about 60% when they were talking about, like, Hey, we're gonna wants to be with Honda. Like, wow, actually, share sliding a little bit after as it's developed a little bit more, all the excitement is coming down. Both companies do face uphill battles. For sure, any meaningful results from a merger might take three to five years. Oh, at least. Here's the analyst, Julie boot. She says, ideally, it would have been a healthy and financially sound company, rather than Nissan. So we've obviously had, we had Brian benstock, if you haven't seen it, we had Brian benstock make some comments on this right before we left for the break. And this is something obviously everyone's watching. There's more at play than just, yeah, like,

Kyle Mountsier  5:55  
I think, I mean, there's two major things at play. One is purchasing power. We know that. The other one is political, you know, that kind of impacts to this. And so I think there's kind of some unspoken stuff probably happening outside of the boundaries of just the partnership. But, you know, it either, either way, when you look at two global brands that are are clearly doing fine when it comes to just like the entirety of where they push vehicles into you're gonna get just like support from being bigger, I think so. I'm sure there's strong, some strategic maneuvering that we're not aware of, and I agree with the estimation of three to five years like, those are, those are two front runners that have been competitors for a quite some time. So seeing the strategic alignments happen over a longer timeline instead of initially, is probably going to be where, where this all draws out. Yeah,

Paul J Daly  6:53  
without that, well, we'll see. I think everybody's in the like, we're just in it for the ride, Honda dealers, Nissan dealers, like, there's really not much anyone can do but pay attention. Yep, yes. Hey, good morning. Everyone on live stream. Hey, Cape mayor, it's good to see you on Good morning. This morning. Good morning. Merry Christmas. Pre Happy New Year. And all the all the other, all the interesting stories happening like while everyone's on on vacation and break California New Car Dealers Association, they are pushing back against Volkswagen Group and scout motors, accusing them of violating state law by taking direct to consumer refundable deposits for their upcoming Scout laws. Money is changing hands now. California's amended Vehicle Code effective January 1 2024 prohibits automakers or their affiliates from direct to consumer sales if they already have a franchise. Dealership network in the state Tesla is exempt, and it has, as it has never, operated through franchisees. Dealers are arguing scouts model excludes VW, 50 franchisees, cutting them out of scouts, EV sales opportunities. Scout is insisting it's independent from VW, despite having leadership that was shared at one point, the California New Car Dealers Association is evaluating legal action of scout and VW do not comply with the law, saying, quote, VW has chosen to launch the scout brand in a matter in a manner that is brazenly unlawful.

Kyle Mountsier  8:17  
We are in a part of that company that owns 100% of us. We're totally not a part of that.

Paul J Daly  8:23  
And that is and that we took the leadership from and placed him over here. Nothing,

Kyle Mountsier  8:27  
literally, 100%

Paul J Daly  8:30  
Paul, 100% dollars have gone into any of this. None

Kyle Mountsier  8:34  
of that has gone into it. And I know you've been digging for

Paul J Daly  8:37  
pickup truck for years, dealers,

Kyle Mountsier  8:42  
we're gonna throw this other thing over here and not call it yours. Thank you very much. It's tough to pass that one. Yeah, this one's tough to get past. I'm surprised, honestly. I mean, we know a few of the people you know over at cncda, and obviously they are pushing back. Saw some of the LinkedIn posts about how they're responding, what the communication pattern is here. I think it's bold to come from California first, because you wouldn't expect that, especially when dealing with a net new brand, when they've already given so much to Tesla, like there's some grounds for a net new company coming in and doing this type of thing. So they must feel like there's a really strong leg to stand in. Obviously, there's recent vehicle code that gives them a lot of leverage, because it's a very recent ruling. So interesting to see what happens here. I think that scout is going to have some reckoning across states. And anytime you see California come out with something like this this early, you're gonna see other states just fall right in line, and we'll see what happens. You

Paul J Daly  9:47  
know, there's, I feel like there's so much opportunity to leverage the dealer network, to deliver these vehicles, to show them off, to test drive them like I know it's complicated, but, man, to bypass it like that. That I just Well, and here's

Kyle Mountsier  10:01  
the thing, like as dealers, VW dealers are some of the from what I have experienced, they're typically like, they swing more savvy. They swing more customer centric. They have already, like VW owners are already a lot more loyal. They're loyal. Why wouldn't you leverage all that brand loyalty? I don't

Paul J Daly  10:24  
get it. I mean, I just don't get it because, you know, Daniel Gover was on the show. He said, Scout motors. And he goes, Who? Who? Right. Scout has a massive lift. Just speaking from a brand build perspective, and what you need to build a consumer brand from the ground up, nobody. I mean, such a small percentage of people remember the old Scout vehicles, right, right? It's just not that iconic. They're trying to bring it back and make it iconic. And I think they just have a much, much bigger lift to get that to be someone's like, prime choice, top of mind. However, like you said, you siphon from the VW brand, right? Scout from VW, right? A VW, a brand, all of a sudden, all the VW owners look and say, oh, right, but they, they can't, they can't do that,

Kyle Mountsier  11:07  
yeah, it's even harder when all you're really building is a land rivian, a land

Paul J Daly  11:14  
that's so good, it's pretty much it is. I mean, the cars are gorgeous. They are gorgeous.

Kyle Mountsier  11:18  
It's just a land rivian. Land,

Paul J Daly  11:20  
rivian Oh, my God, okay, speaking of gorgeous, I don't

Kyle Mountsier  11:24  
have any segue, just stop it. Oh, it was bad joke. Bad joke on a Monday. I think it's a good joke. It worked. It worked. The recent study has named Shake Shack and five guys as a most America's most overpriced fast food chain bait over the premium pricing for burgers and fries is really worth it. A company called properly analyzed 57,000 Google reviews highlighting Shake Shack as the most overpriced, not just expensive, overpriced chain, followed by five guys and sugar factory, key terms like expensive and not worth the money, dominated a lot of customer feedback back in March, a viral receipt for $22 for a cheeseburger, bacon cheeseburger, soda and fries obviously led to a lot of widespread backlash for five guys with one post asking, what is the right amount these days, Shake Shack has raised prices twice in 2024 3% of March, One and a half percent in October, citing inflation pressures, still Shake Shack. They're making money strong. Q3, earnings, 14% revenue surge, 17 new locations. CO Robin Lynch said, we're proud of the results. As we grow total grew total revenue with positive traffic. Listen, people still showing up. Well, the question

Paul J Daly  12:40  
is, like, what is overpriced? Because if people show up, like the person who bought the $22 burger, fries and soda, I guarantee every bit, I guarantee you, when they walk out the front door of that of that five guys, they could within eyesight, see a McDonald's and a Burger King, absolutely right. And if you want to pay $12 you can go to McDonald's or Burger King, that's right, but if you want, if you want, I mean, it's just, well, I think that's just the position here. Like, yeah, we, we're, like, a lot of people still remember going and getting a Big Mac meal for 589,

Kyle Mountsier  13:10  
right? Or

Paul J Daly  13:12  
222, cheeseburger meals for 299, we were just telling my kids mom, I used to eat at McDonald's for six bucks total.

Kyle Mountsier  13:18  
Easy, and that's just not a reality. Like, no Chick fil A, we come out of Chick fil A, and I'm like, they took my wallet too. It's crazy,

Paul J Daly  13:28  
right? Mortgage showing up. But,

Kyle Mountsier  13:30  
like, personal, I've never seen a Shake Shack. Not busy, not. You ever been to a Shake Shack? And it's like, where did all people go? Not, it doesn't happen,

Paul J Daly  13:39  
right? Never actually. So it's funny, like when that Shake Shack picture come up, Nathan, you put that back up, this specific Shake Shack model. It conjured, it conjured a feeling for me, because I don't know if you remember you and I had were dealing with one of the most toughest, the toughest business, like forks in the road. I mean, it was, it was a year and a half ago, so we figured it out. But we were like, in there, we're like, what are we gonna do about this? Yeah, hit a Shake Shack that looked just like that, and

Kyle Mountsier  14:11  
that burger was stellar. Oh, I would

Paul J Daly  14:13  
have paid $50 for that burger. Timing perfect that I wasn't buying a burger. I was buying solace.

Kyle Mountsier  14:21  
And yes, and

Speaker 1  14:22  
I'll say every time I go into a Five Guys and that that the fries are just like, just overflowing. And you're like, how this is not a small, this is a double extra large. They do that everywhere else. Yeah, the whole thing. And by the way, I think it's worth since we're just commentating at this point, I think it's worth mentioning that if you're ever in the airport, Atlanta airport, I can't remember, is it B terminal or C terminal? There's a Five Guys. I think it's a terminal. There's a Five Guys. And the staff there is always entertaining. They're always great. We've been there several times. And when we say entertaining,

Kyle Mountsier  14:55  
like, it's not just the entertainment, like you would entertaining. Okay, yeah, it's amazing, entertaining.

Paul J Daly  15:02  
So if you ever do that, go to that five guys. Make sure you tell them we sent you to which they'll have probably some entertaining response, because they're upbeat, they're energetic, the food's always good. And that's just little airport recommendations for Paul little echo, at the beginning of the year, we'll travel here, actually, just start off 2025, right? Go to five guys in the Atlanta airport term, we'll see That's right, don't we sent you look whatever you're doing. Close out the year strong. We have two days until it's 2025 we'll see you tomorrow morning.