Reimagining the Showroom, EV Charger Dollars, Global Labor Competition

SPEAKERS

Kyle Mountsier, Paul Daly

Paul Daly  00:30

All right, it is Monday, first day of June 2022. It felt like what it felt like the first day yesterday.

Kyle Mountsier  00:39

It was unbelievably

Paul Daly  00:41

hot, humid in Virginia. It's already hot and humid. You know me I'm a big heat baby. So when it gets above like Syracuse, it gets above 76. I'm like, What are we even doing up here? But we have a lot to talk about today we're talking about reimagining the showroom experience. Right spent our hand in the dirt we're also talking about evey charging infrastructure lagging behind actual demand, and why the UK is going to try to steal all of our best talent. I don't think we have music today.

Kyle Mountsier  01:09

We don't have music there's no music.

Paul Daly  01:12

When we roll we roll with the setup so we're in a hotel lobby right here we've just decided we just stopped caring about with anybody there we go. There's

Kyle Mountsier  01:19

everybody's walking past us

Paul Daly  01:21

it's great trucks the line nice

Kyle Mountsier  01:23

spot, actually really nice spot. Yeah, the we were if you watched or listen to yesterday's podcast, you know, we're hanging out with Liza Myers Borches her team here at Simon's sometimes him got to see him at cartomizers automotive, and one of their the CEO, they recommended this place called the draftsman. And it's a really unique like, mix of old and new. So we feel like we're in a little bit of a setting. So yeah, hopefully you're experiencing that a little bit with us this morning. All right, to

Paul Daly  01:52

frame this up this morning. You know, sometimes we mentioned Simon Sinek, because he always puts out like these little shots every morning in his email, and today's was specifically relevant. Sounds like this, a culture is strong when people work with each other, for each other in a culture is weak, when people work against each other, and for themselves. Yeah. And yesterday, I think we got a really great example of what it is when people work for each other. Right? And not for themselves. The CMA Carter Myers Automotive Group is really a great example of people going in the same direction for the same reason. And, you know, we see this in all different ways all across the industry, right? And it's always like, well, there's no one way to do it.

Kyle Mountsier  02:36

Yes, yeah. No, it when you see it, you know, what I love is when you get in these organizations, and some of the organizations that you and I have gotten to go in over the past year and years, when you start to talk to the teammates, and the people around it, you know, you go from like the leadership, and then you get down, you get to the teammates that are and Associates and employees. And it's always interesting to kind of hear how the take of the overall vision of the company is just like embedded. And almost, they sometimes even get more more passionate about the way that the brand is represented on the ground level. And when you see that, you know, there's a strong culture because it's like, no, you can't mess with this, because this is a part of who is a

Paul Daly  03:22

really great, great way to put it. You know, I almost think of it like like a great fabric. Yeah, right. It's all belongs together. But there's definitely different texture as you meet the different people. And yesterday, I can't tell you how many times you know, I went up to somebody, and they could not wait. They knew I was a visitor. Yes. And they could not wait to tell me about how great the company is

Kyle Mountsier  03:45

or their perspective about the company. Company. Yeah, it was kind of like, oh, you're a visitor, let me tell you the story. And that type of excitement I think for if you're in business, and that's the type of excitement that people instead of just like, Oh, hey, how you doing? Why are you here? This is my task that I do. This is my task. It's like, no, let me tell you the story behind why I'm here what I do you know, what we do? And like, it wasn't, it's not a facade, when that happens is just everyone kind of rolling together like the Simon Sinek thing.

Paul Daly  04:15

It's easy to think, you know, I want to caution people against hearing stories about you know, these organizations that we put on a pedestal, right, because every organization, man stuff is broke, right in every organization. And so there's no Disneyland when it comes to business, right? There's great culture, but other things are broken, right, like in asoto, our little growing community, right? Yeah, like people believe in what we're doing. They're good vibes. But there's also a lot that's broke. Right? Exactly.

Kyle Mountsier  04:47

I think that's important to point out is that we a lot of times, especially in automotive, we will start to kind of follow or even just in general there's kind of this like influencer nature, where it's like, oh, that they just may judge Just must have it all dialed in. Right we do it they're doing Yeah. And I think that one thing that you pointed out that you've been pointing out is that there's there's like, so many different ways to get really good business done. And as long as you're constantly approaching your business business with the the need for innovation, the need for excellence, the necessity to shift and change, then you're doing it right, because you're constantly challenging yourself. Speaking of stuff that stopped, right, speaking of constantly needing to innovate and change, Honda recently has come out with their newly redesigned showroom concept and actually was interesting, we were in the car yesterday talking to Liza about some of the plans that they have in the franchise's that they have and she mentioned Honda, we went to Ohio store with the Scott Simon's Honda store saying like their new reimagined, showroom is smaller, more compact, more like thoughtful on how to deliver an online to offline experience. And then we get online this morning, and we're kind of searching the interwebs and Jalopnik. You can see the link in the article has this article about how Honda plans to redesign dealerships, the quote is into modern retail spaces, that are basically terminals along the way to evey ownership, not destination. And I think that that's really important to think about this modern retail experience, but also that, that the that the showroom is not necessarily just the endpoint, that it's a part of the overall journey. Right and I've talked about this a lot is that designing a retail experience and not just a retail experience, but a visit experience, a service experience, along a journey and like mapping the overall ebb and flow of the customer journey in and out of your online and offline spaces and Honda's kind of taking that approach really seriously with with EVs and with, you know, a new generation of retail experience for auto.

Paul Daly  06:57

So what can a dealer do with this? You know, obviously don't have unless you're on an advisory council, right? You might not have direct say into what is going to happen. But for sure, there's something you can do, right there is there are things that you do have control over in your showroom, even if, like you're not up for a refresh, you're not up for building a new showroom? Like don't check out of the mindset that when someone walks or drives onto your property, not when they walk in your front door, when they drive onto your property. Right. It's just people assume that's where the customer parking is, oh, they'll see it. It's close to the building. No, actually, not. There might be, you know, three salespeople standing, you know, by the main entrance, who might make someone like go away from it? Yep. Right. And so there are things already that are happening in your store. And I bet if you spend like an hour, right, watching how people come in to service and sales and interact with your store, you're going to learn right away that like, oh, there are probably a few small improvements we can make. Yep. In that customer journey. So it's not like an all or nothing thing. Yes, large scale design and realizing like designing it from the ground up is important.

Kyle Mountsier  08:02

That's a whole structure. And the OEMs have to be involved in all that. But yes,

Paul Daly  08:06

don't check out.

Kyle Mountsier  08:07

Exactly think about the customer journey from like, lat to finish and where are they headed? What are they going through navigating? Is it clear? Is it is it you know, are there necessary movements that they need to make? In order for them to feel confident, right, there's this I was when I would send salespeople shopping, it was so funny to hear. And we would do mystery shops, and everybody does it. So everybody does it. Yeah. But it was so interesting always to hear the like the perception of like that, you know, they had just been hired at a dealership or something. And they would get this anxiousness and not really know where they know our game. And they know and they know someone will the game. And so think about that customer holding on your lot. How do they

Paul Daly  08:53

get the right exercise and empathy? It's so good. It's a great exercise. So don't check out. Pay attention to it, because it is the experience and even if you're an industry partner, right, maybe your front door is your website, think about how people now we have a lot more conversation around like website landing. And it's like, you know, people have full control over that experience. As far as like, I can go to another tab, I

Kyle Mountsier  09:13

can close the browser. Yeah, I don't want to get into the OEM program thing, but you know, I'm talking

Paul Daly  09:19

about if you're an industry partner, oh, yeah, you're trying to get dealers or other people to come into your ecosystem, right? It's still the front door. And there's still a journey involved and if your website doesn't involve taking someone through a journey, it's just like, here's all my stuff right? I do this and I do this and I do this in a battle out right like yes, you know, think about it journey mode. Okay, we're gonna move on. So EV, charging stations, Wall Street Journal article this morning saying we're predicting already that the charging infrastructure is going to be lagging behind Evie, rollout big surprise way. Really, really.

Kyle Mountsier  09:55

I'm really excited about this article article because it allows us to feel Are there necessitate a trigger pad that we have to make?

Paul Daly  10:03

I mean, it's, it's coming, you'll hear it in a second. So basically, the the Biden administration's plan may hand out $7.5 billion across the country to states to invest in the Evie charging infrastructure. And at that surface, that sounds really great. Yes, we need money. Infrastructure is important. It spurs around all kinds of business. There's one problem that states haven't spent the money they already have over four years ago. Remember the big mega VW scandal?

Kyle Mountsier  10:31

Do you remember that?

Paul Daly  10:32

So it's $2.8 billion settlement for environmental to increase environmental activity, because you know, the diesel thing, and they're polluting the environment more than they said, they were sort of like, Okay, we're gonna make you give all this money to make the environment better. Well, about 400, almost 500 million of that was handed out to states to build Evie, charging infrastructure. And at this point, less than half of the money has been spent four years later. So like Steve just aren't spending the money. I don't know if they're planning if they don't know what to do. But the government's about to give another 7.5 billion. And it's like, well, the states need to figure out how to start building incentive spending that

Kyle Mountsier  11:10

they should hand it to the public sector is what I think are the to the private sector, to the private what's happening right to the private sector, because I think that that would be a quicker way, because infrastructures are already tough from the public sector perspective, like look at the roads in your state. Right. And, yeah, I mean, it doesn't matter what state you're in, everybody's like. And so I do think that we have to figure out how to get the public money to the private sector.

Paul Daly  11:39

On the state world, right? If you look at the map, and the linked article, like some states have done that really well. Yep. And while some states have done it, done it, they've done it, like Texas, for instance, handed out most of their money, and they had an application project. And when applications open magically, I bet there was no conversations or previous relationships implied in any of this. But 85% of the money went right to shell corporation. So so that's probably not going to cut it either. I'm sure there was no Scotch or cigars, or no cowboy hats, around, drinks or anything with any of that. And but here's the thing, like convenience store owners were applying for it right? You think of the ways that people like spend a little bit of time and could charge in the fast network especially. And so like, this is just, this is just an element of infrastructure for candidates and catching up with neat because the need is not there. It's there. It's a really weird scenario like

Kyle Mountsier  12:34

chicken a little bit, right. But it also kind of all has to land at the same time in order for it to work. You know, the kind of numbers as they as they fall out is the Biden administration is saying they need 500,000 by Park charges by 2030. But a company called McKinsey and Company who's done a lot of research across like infrastructure needs, is saying that 1.2 million are needed, that's 700,000. Chargers,

Paul Daly  13:05

or half, even if we get to 500,000 or 700,000. Short. Currently, there are only 5000 Fast charging locations in the US a total of 10,000 fast chargers because if you don't know this about Evie technology you're about to but a fast charger will charge your battery like to 80% in about 30 minutes, which when you're charging feels still really good really long time. But if you don't have a fast charger, right, when which has to do with enough power going to that to eight hours. Yeah, there's a charge. Or you sit there for an hour and you get like 100 miles, right? Yeah, so obviously we're very far behind, or we're going to be very far behind. What can you do right now? Like I think it's a great opportunity to invest in the infrastructure in your dealership and become a spot where people know they can go for a fast charge.

Kyle Mountsier  13:51

fast charger coffee shop, boom, and it

Paul Daly  13:55

better be good coffee if he's around better be good coffee, or he's gonna spit on your fast charger and the way by No, but for real like this is a great time to like think a little bit more retail mindset with your store when talking about how are people welcomed into your property? Right fast charging stations. Look, you know what it's like when when you get the you get the reputation for like the fast Wi Fi. Like everyone's like I'm going to that place because they have the so fast charging stations we're going to behind you're already have the infrastructure in place to get most of this stuff built quickly. Absolutely. So yeah, little little retail opportunity. We got one more story. It's kind of tags off of something we've been talking about for the last I mean, probably the last six months, but we've talked about it yesterday. Yesterday, the labor shortage, the sands Demmick there's not enough people. We experienced it last night, right. So we had we had dinner with the CMA crew. And we're like, you know, we're traveling, we need some ice cream, right? And we're like, oh, this is a cool little ice cream shop. We walked in there was a line of about 10 people. Then we realized there's one older woman scooping ice cream by herself and I kept waiting for someone to come out of the out of the back.

Kyle Mountsier  14:59

I know I So too, and it was wild, because in this area, there was just a ton of restaurants a ton, a ton of movement of people. And yet in like, whatever it was seven or eight o'clock on a Tuesday, one person scooping ice cream. And so you know that it's every industry, it's every person. And now the most recent news is that the UK has created the opportunity for college graduates from 20 US schools that they prioritize, to give them visas without the need for a job. So if you think about like international visas, typically you need a firm job offer from a certain level of cooperation in order to get that visa for that, that work visa. But people with graduate and with master's degrees and associate's degrees and bachelor's degrees come on over two years. And anything PhD can get three years of a visa with only the need to prove that you can like live for one month there

Paul Daly  15:56

and right the strategy right? It's like, come here, right? meet somebody love, right. Find a reason to stay well and then work here.

Kyle Mountsier  16:03

It also says they can bring their families like they get the whole family gets a visa.

Paul Daly  16:08

So so look at the labor shortage is not it's global. Yeah, right. It really is a population thing. It really is, like a developed country, like we're going to compete for your talent. Yes. Which just doubles down on the mentality, like, have an amazing place to be, have an amazing place to work, have an amazing place to attract. It's an attractional labor market right

Kyle Mountsier  16:30

now it is and go into the unique spaces that I mean, literally a country is going to another country to solve labor shortages. What do you have to do to solve the labor shortages locally? If that's what's happening globally? You have to be inventive. You have to create resources and people network to be able to attract that that talent for

Paul Daly  16:52

sure. There you go. It's going to be another day in the dirt for us, right we're out going out of dealerships, getting our hands in the dirt figuring out how to make this industry better, how to encourage some people, we hope that you go out and encourage some people make them understand what it is to be in the industry where and make them understand what it is that we have the opportunity every day to serve one another to serve other people and have a lot of fun doing it.

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