The 2025 Predictions Episode with Steve Greenfield

Paul J Daly  0:01  
All right, rounding out the week with the one and only Steve Greenfield just feels like the right person to round out the week. We're gonna ask him about his predictions, give see if we get a sneak peek, but we're also gonna talk about what he said last year and whatever else comes up. Mid man was just in Kazakh two weeks ago. He's got something to say. The

Kyle Mountsier  0:20  
man who was in Kazakhstan. He's been all over the world this year. He's seeing a lot of stuff. You know what? It blows my mind. I asked Steve Greenfield, I was like, Okay, who does your social posting? Nope, it's him. That's crazy. Who writes the weekly email? Nope, it's him. Who writes all your speech? Yep, it's him, this man. I don't know if he actually sleeps. I don't know how you can with that many cats. I need. I need him.

Paul J Daly  0:50  
He's probably Steve actually has, like, the tree house, right? The cats live on the ground, and he climbs up into his tree house bunk bed to get away from the casting. So I don't know but, but Steve has always been an amazing friend of ASOTU, and he always has such astute insights, and he's always got this boyish smirk about him, like, oh, okay, I see what you're talking about there. Let's, let's make a little trouble. So we hope you enjoyed this clip of Steve Greenfield, where we're gonna try to get him to spill the tea on his 2025 predictions early. All right, there are a lot of smart people in the auto industry, but not many come close to the one and only Steve Greenfield, whether he's dealership consulting, speaking on stages from Dubai to Kazakhstan to Las Vegas, or shifting mo village the mobility investment landscape with his automotive ventures, He's, um, he's a one of one. We're gonna call him, and he's joining us now. Steve, thanks so much for being

Speaker 1  1:41  
here today. You're far too kind, Paul. It's really great to catch up and happy holidays. Oh man, it's

Paul J Daly  1:46  
so we've had definitely a wild year. You are always if, by the way, if you don't get Steve's email, go to automotive ventures.com and sign up for it. You cover everything going on in the mobility space today. You were talking about underwater drones, but you also have a lot of you work, but you also talk a lot about dealership operations and mostly about the technologies that are changing our industry. 2025, 2024, has been wild. What do you feel have been the most impactful things that have come out of 2024

Speaker 1  2:19  
so far? Oh, boy. I mean, there's a lot. Yeah, I think the big thing at the beginning of the year was the threat of Amazon, this Hyundai relationship, and that's been a slow burn, right? I mean, we were expecting that by mid year we'd have all the Hyundai stores on didn't happen, that by the end of the year they'd have like, a bunch, I think they may have announced like 10 or 20 additional OEMs. Didn't happen, and so they had some growing pains. And, you know, just within the last week, they've announced that they're going to, you know, all 50 states or whatever, with the Hyundai program. But it's been slower than ever. So that was going to be a disrupter, not really a big disrupter. You know, we've heard a lot about AI. You guys are publishing your newsletter now on AI, which is really awesome and good for you, for the benefit of the industry, really getting your their heads around. You guys are helping folks get their heads around what the implications might be. So thank you for that, and I think that that's a big thing to be paying attention to. You know, you and I have talked before about just the practicality around AI, really augmenting your current employees, right? Just think of it as a co pilot or a helper, you know, increasing their IQ points and increasing their productivity. That's what we're going to see, I think, you know, for the next six to nine months, that'll be the buzzworthy thing at nada. I think in the next month, you know, in New Orleans, is, is really like how the existing vendors are starting to use AI within their tools to help dealers drive more productivity per per employee.

Paul J Daly  3:41  
You know, there was a story yesterday that we covered a company, a FinTech company, called named Klarna, said that they, they actually hired 1000 less people this year, 1000 less because of AI. Basically, they went from 4500 not they let natural attrition of a tech company bring them down to 3500 didn't hire anyone to replace that, and they said they currently have AI agents doing the jobs of 700 humans when it comes to customer support. Do you think the customer support side is going to be the biggest player in the AI tech or do you think it's going to be something else in the auto industry?

Speaker 1  4:16  
Well, look, apply this to auto and I think that, well, 10 years from now, for sure, but we could bet, you know, a pizza on whether it's gonna be in five years. But 10 years from now, we will look back at the BDC like the rotary phone. Wow. People will be like, No, really? Dealer shop operations. They'll be like, you allowed humans to be the first line of defense on leads. You ever? How

Paul J Daly  4:39  
did you even do that? You're like, well, we kind of did it, yeah,

Speaker 1  4:42  
humans that can make, make errors, and, you know, can be replicated, and you can have, like, the perfect robot answer every lead, 24/7, perfectly every single time. Why would you have trusted that to a human? So just think, think this way that, you know, if that's 10 years from now, what has to happen the. Between now and then, obviously, the technology has to get better, and we have to be able to train the technology better. But there will be a bunch of roles at dealerships, you know, where there are repetitive tasks in front of computer screens that, you know, we don't have to fire people. But you know, when there's either turnover and or retirements, the dealers are all the option to say, you know. And you know, one of the things I like to talk about, you know, Paul, you know, I've talked about before, is something like 60 like 60% of a dealer's monthly cost structure is human capital. And, you know, the best way to drive profits to the bottom line is to do more work, more revenue with fewer people. I mean, it's a huge point of leverage for dealers to, like, slowly but surely take out human capital. The easy way to do it without firing people, you just drive more productivity, right? Yeah. So to your point, we don't to hire more people. We're generating more revenue, and our people are doing more work through automation, and they're obviously not smothering them and crushing them with the work. You know, their jobs are actually getting getting easier, yet we're driving more revenue, revenue over time, though. You know then you also start taking humans out, and you're getting more revenue, more productivity per sales person. And you can take costs out, and your dealers should be generating more profit over time as they look back and say, What has AI done for me?

Paul J Daly  6:19  
Let's look ahead to 2025, across the board, not just in AI. Can we get a sneak peek, maybe, at some of your predictions? Because you always release, I know you release predictions, and then you grade yourself at the end of the year next year, and then you put out new predictions. Can we get a sneak peek of any of your predictions? Well,

Speaker 1  6:36  
I have to admit, I haven't worked that on, but this good, I'll brainstorm on the spot here. So okay, the work in progress, but no, look, I'll just talk about macro trends in general, right? So we are about to see, you know, more M and A activity next year from really, really big companies than we've seen maybe in our lifetime. Because, well, think about big companies that say, look, while the government's looking the other way, and there's going to be almost zero scrutiny of anything anti competitive. I'm going to I'm going to rush move. I'm going to rush the gates, right? So if any big companies have been thinking about, you know, bank, bank mergers, pharmaceutical mergers, or whatever, I mean, now would be the window in the next, like, 18 months, yeah, to push them through, and once we see a couple of multi billion dollar or 100 billion dollar, $200 billion deals happen, it's gonna start giving people confidence. And I think then that will open up the IPO market, which, by the way, has been shut for a long time, right? So I don't know what the stock market's gonna do it. You know, it scares me a little bit when guys like Warren Buffett are amassing cash you know, and valuations that are all time high. So I'm not going to try to call the market one way or another, that's an errands game, but I think, at the same time, I think that what we're going to see is like big company M and A, which is going to then open up the floodgate for smaller company M and A, so you'll see a lot of automotive technology companies transacting, right? Um, probably not going IPO in the short term, but a lot of buy and sell activity. Or be like, oh my goodness, people are buying companies left, right and center, be a lot of cash flowing around, which I think is good, because a lot of pent up demand. So entrepreneurs who have been sitting for a long time waiting for an exit will finally have the window to do so. But don't be surprised if you know, in the next 18 months, you see a flurry of acquisitions, acquisitions by the big guys, you know, the Cox's, the Reynolds, the CDKs, etc. But even some of those big companies, they may take the opportunity to monetize and go and exit as well. Interesting.

Paul J Daly  8:35  
Well, Steve as always, thanks for opening our minds a little bit. Always. Great conversation. Happy holidays to you and your family and all of your cats, and we look forward to an amazing 2025 together.

Speaker 1  8:46  
Paul, just say thanks for everything you guys do for the industry. I really cherish the relationship and have a great holiday. Thank you.

Kyle Mountsier  8:56  
All right, write them down, fam. That's what you get. Steve Greenfield said it, let it be so, yeah, I mean, I'm, I don't know about you, but I'm paying attention. I'm turning the the bell on that guy's social media profile right on LinkedIn. I'm signing up for the weekly automotive news or automotive ventures email. Sign up for that. I'm coming to a sodu con. I'm going to the events that he's hanging out with, because he's just thinking about how industry partners, how dealers, how OEMs, engage in the current retail climate, but he's also doing that for the future. So there he is. There

Paul J Daly  9:32  
he is. Look, we hope you had an amazing Christmas week. We certainly had a great time spending it with you. Have a great weekend. We will see you here with just a couple days ago, before New Year's. You.

Transcribed by https://otter.ai

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