Latest / CBT Live / Can Mobile Service Keep Customers Loyal? Hidden Fees, VinSolutions Probe (10.27.26)
Transcript
- 0:01SPEAKER_03: How do dealers turn that first service visit into a customer who keeps coming back?
- 0:05SPEAKER_00: Plus, dealer pricing is still under the FTC's microscope.
- 0:09SPEAKER_00: What do dealers need to do to get and stay compliant?
- 0:12SPEAKER_00: All that and more coming up on CBT Live.
- 0:23SPEAKER_03: Hey everyone, welcome back to CBT Live, right here at the CBT Automotive Network.
- 0:27SPEAKER_03: Today's Tuesday, October 27th.
- 0:30SPEAKER_03: I'm joined by Bridget Fitzpatrick, my partner in crime.
- 0:34SPEAKER_00: Jim Fitzpatrick.
- 0:36SPEAKER_03: That's right.
- 0:37SPEAKER_00: Thank you so much for joining us today.
- 0:39SPEAKER_00: We really appreciate you being here.
- 0:40SPEAKER_03: Absolutely.
- 0:40SPEAKER_03: There's only five days left, folks, in this in this month to make it happen.
- 0:44SPEAKER_00: Four if you're Cherokee Mitsubishi, though.
- 0:46SPEAKER_03: Four.
- 0:47SPEAKER_03: Wow.
- 0:47SPEAKER_00: Not open on Saturdays.
- 0:49SPEAKER_03: Is he still on your radar then?
- 0:51SPEAKER_00: No, I mean I can't wait to see how that's going.
- 0:52SPEAKER_00: We're going to talk to Jonathan again before the end of the year.
- 0:55SPEAKER_03: Well, we better get him.
- 0:56SPEAKER_00: Giving it to the end of the year to see how it goes.
- 0:58SPEAKER_03: But don't call them on Saturday because they're closed.
- 1:00SPEAKER_00: Or call them.
- 1:01SPEAKER_00: They'll be available.
- 1:02SPEAKER_03: No, I think I think everyone in the industry is waiting to see how that uh that test goes.
- 1:06SPEAKER_03: Right.
- 1:06SPEAKER_03: You know?
- 1:07SPEAKER_03: I know.
- 1:07SPEAKER_03: It's like close on Saturday.
- 1:08SPEAKER_03: Wow, that's a that's a whole new deal right there.
- 1:10SPEAKER_03: Yeah, I know.
- 1:11SPEAKER_03: So there's a lot of a lot of people looking at that for sure.
- 1:14SPEAKER_03: Right.
- 1:14SPEAKER_00: I know.
- 1:15SPEAKER_00: Who knows?
- 1:16SPEAKER_03: Who knows?
- 1:16SPEAKER_03: But there's five works.
- 1:18SPEAKER_03: If you're not at that Mitsubishi store, there's five days left to make it happen.
- 1:22SPEAKER_03: As you all know, you're sitting on deals.
- 1:24SPEAKER_03: You can go out and get them, make it happen today.
- 1:26SPEAKER_03: For those of you that have already hit your your your uh your bonus level, uh you know you're sandbagging those deals until next month, right?
- 1:33SPEAKER_03: That's what I used to do.
- 1:34SPEAKER_03: I was a king of sandbagging.
- 1:36SPEAKER_00: Are you recommending that?
- 1:37SPEAKER_00: I don't think I'm not recommending that.
- 1:39SPEAKER_03: I'm just talking real to my fellow salespeople out there that are like I've already hit my 20 cars.
- 1:45SPEAKER_00: The managers and dealers are going shut up.
- 1:47SPEAKER_03: No, no, because you uh okay, dealers, here's what you gotta do.
- 1:50SPEAKER_03: You gotta you gotta okay, they hit the number of 20 cars, 25 cars, whatever it is.
- 1:54SPEAKER_03: Okay, if you're a salesperson, you're like, okay, what if I did 30 cars?
- 1:58SPEAKER_03: Okay.
- 1:59SPEAKER_03: So I mean I'm sorry, I didn't mean to be wasting your time.
- 2:03SPEAKER_03: I get how it works.
- 2:05SPEAKER_03: No, but if you're a salesperson, you go, oh, I'm holding back those next deals to see what next month's gonna bring so I can start the month off strong.
- 2:13SPEAKER_03: That's right.
- 2:14SPEAKER_03: He's knowing what I'm saying.
- 2:15SPEAKER_03: You guys know what I'm talking about saying, begging Sunday.
- 2:18SPEAKER_00: Anyway, we have a really great show coming up, Jim Sabino of All American Auto Group, on turning that first service visit into long-term customer loyalty.
- 2:28SPEAKER_00: And then we have Zach Shevska of Car Edge.
- 2:31SPEAKER_00: He joins us to talk about pricing transparency, hidden fees, and the dealer practices that can really erode customer trust.
- 2:38SPEAKER_03: So that picture looks like he's gonna jump out that window if dealers keep this up.
- 2:43SPEAKER_00: Well, he's he's busy, he's a busy guy.
- 2:46SPEAKER_00: Yes, for sure.
- 2:46SPEAKER_00: So there's no question about it.
- 2:48SPEAKER_00: Yeah, maybe one day he won't be busy anymore.
- 2:50SPEAKER_03: I'm glad Jim Sabino's on the show.
- 2:52SPEAKER_03: This guy knows service, like nobody's gonna be.
- 2:53SPEAKER_03: I know, I'm really excited about that conversation.
- 2:55SPEAKER_03: Incredible.
- 2:56SPEAKER_03: He he knows a little something about bringing the customers back, mobile service.
- 2:59SPEAKER_03: He's the guy we turn to.
- 3:00SPEAKER_00: That's right.
- 3:01SPEAKER_03: That everybody turns to.
- 3:02SPEAKER_00: I know.
- 3:02SPEAKER_03: You know?
- 3:03SPEAKER_00: Very cool.
- 3:03SPEAKER_03: He's on Ted Ng's show all the time.
- 3:05SPEAKER_00: Teddy.
- 3:06SPEAKER_03: He thinks he's so big.
- 3:08SPEAKER_03: No, Ted does a great job.
- 3:10SPEAKER_03: They do over there, yes.
- 3:12SPEAKER_03: He's got the students of uh, he does a great job.
- 3:15SPEAKER_03: I know.
- 3:15SPEAKER_00: He really does.
- 3:16SPEAKER_00: Love it.
- 3:17SPEAKER_00: So before we get to those great interviews, I do have a few stories.
- 3:20SPEAKER_00: The first one is the Cox Automotive story this morning.
- 3:23SPEAKER_00: Um they're investigating suspicious activity involving Vin Solutions, their CRM platform.
- 3:28SPEAKER_03: Look like you're upset with that.
- 3:29SPEAKER_00: And I am serious about this conversation when I get serious about my hands going on.
- 3:34SPEAKER_03: You're gonna give us a cheater.
- 3:35SPEAKER_00: But it is serious, it is serious.
- 3:37SPEAKER_00: I don't want to make light of this.
- 3:39SPEAKER_00: No, it's very serious.
- 3:40SPEAKER_00: A hacking group claims that it stole information, but Cox has not confirmed these claims, and the specific information the group says it obtained remains unverified.
- 3:49SPEAKER_00: Cox says the activity was quickly contained and affected a limited number of Vin Solutions dealers.
- 3:56SPEAKER_00: The company's working with outside cybersecurity experts to determine what data was involved.
- 4:01SPEAKER_04: Yep.
- 4:01SPEAKER_00: And the incident did not, this is what Cox is saying, the incident did not affect its other platforms, it did not involve encrypting malware, and did not disrupt dealers' use of Vin Solutions.
- 4:12SPEAKER_00: So it seems like a little back-end situation that they're gonna take care of and everything will be fine.
- 4:17SPEAKER_00: But I thought it was worth mentioning.
- 4:19SPEAKER_03: Sounds like Vin Solutions has already come up with a solution.
- 4:21SPEAKER_00: Yes, that's right.
- 4:22SPEAKER_00: Right.
- 4:23SPEAKER_00: I know.
- 4:24SPEAKER_03: That's right.
- 4:24SPEAKER_03: Well good.
- 4:25SPEAKER_00: Okay, and then yesterday we told you about Audi's plans for its first US factory in Georgia.
- 4:32SPEAKER_00: Yeah.
- 4:32SPEAKER_00: Now there's a new development involving how that announcement was made.
- 4:36SPEAKER_00: Yes, Audi CEO, Gernot Dolner, is facing criticism from German labor leaders after appearing alongside President Trump at the campaign rally to present the project.
- 4:46SPEAKER_00: The head of Germany's IG Metall Union said Metal.
- 4:52SPEAKER_03: It's a mouthful.
- 4:53SPEAKER_00: I know right.
- 4:53SPEAKER_00: Their union said the appearance violated the company's politically political neutrality guidelines.
- 5:00SPEAKER_00: So we'll see where this goes.
- 5:02SPEAKER_00: Audi is defending the decision, saying that it it accepted the invitation with the company's interest in mind.
- 5:08SPEAKER_03: Okay.
- 5:09SPEAKER_00: So and then there's also an important detail here that we didn't mention yesterday.
- 5:13SPEAKER_00: The proposal for the investment still needs approval from Volkswagen's supervisory board.
- 5:19SPEAKER_03: So they put the cart before the horse there or the Audi before the horse.
- 5:23SPEAKER_03: Unless they know something that's just like formality, they're gonna get yeah.
- 5:28SPEAKER_03: Right.
- 5:28SPEAKER_03: Because I can't imagine them getting up on stage with Trump and and not clearing that.
- 5:33SPEAKER_03: Right.
- 5:34SPEAKER_03: You know what I mean?
- 5:34SPEAKER_00: Mm-hmm.
- 5:35SPEAKER_03: So Yeah.
- 5:36SPEAKER_00: So we'll we'll keep following.
- 5:37SPEAKER_03: I wonder if Trump was checking out the guy's backside because it seems Trump.
- 5:42SPEAKER_00: He is all about that lately.
- 5:44SPEAKER_03: He's about that.
- 5:45SPEAKER_00: He's about Nicki Minaj's uh hers, and then uh a guy.
- 5:50SPEAKER_00: Right, the guy that was saying it had the shoulders of steel and the and the nice, you know, what he's very talented.
- 5:57SPEAKER_00: I mean never a dull moment on that front.
- 6:03SPEAKER_03: You could only laugh at this though.
- 6:04SPEAKER_00: No, no.
- 6:05SPEAKER_00: You can't.
- 6:05SPEAKER_00: I mean, there's nothing, nothing shocks me anymore.
- 6:08SPEAKER_00: It's just it's where we are.
- 6:10SPEAKER_03: That's right.
- 6:10SPEAKER_00: Um also Microsoft is offering voluntary buyouts to approximately 60,000 employees.
- 6:16SPEAKER_00: That's more than a quarter of its global workforce.
- 6:18SPEAKER_00: And why are they doing it?
- 6:19SPEAKER_00: Well, this is why the company is working to contain costs while major making major investments in artificial intelligence.
- 6:26SPEAKER_03: Yes.
- 6:26SPEAKER_03: So AI is AI a quarter of their workforce.
- 6:30SPEAKER_03: 60,000 employees?
- 6:32SPEAKER_00: 60,000.
- 6:32SPEAKER_00: Now that figure is the number of employees eligible for the offer.
- 6:36SPEAKER_00: It does not mean 60,000 have been laid off or that 60,000 agreed to leave.
- 6:41SPEAKER_03: Yeah, they usually do that right before Christmas.
- 6:44SPEAKER_03: Oh, yeah.
- 6:45SPEAKER_03: Okay, for those of you that didn't take the package, you're no longer with us.
- 6:50SPEAKER_00: I guess that's a a nice way before the layoffs.
- 6:53SPEAKER_00: Right.
- 6:53SPEAKER_00: Yeah.
- 6:54SPEAKER_00: You have this opportunity, right?
- 6:56SPEAKER_03: But this is probably layoffs are probably coming.
- 6:58SPEAKER_03: Right.
- 6:58SPEAKER_03: But I think the the the takeaway there for a lot of people is the AI, because we, you know, is is is clearly taking jobs.
- 7:05SPEAKER_03: Is clearly taking jobs.
- 7:06SPEAKER_03: There's no question about it.
- 7:07SPEAKER_00: Yes, clearly replacing people.
- 7:09SPEAKER_03: That's right.
- 7:09SPEAKER_00: So Microsoft says the voluntary program gives eligible employees the opportunity to leave with financial support and a career planning resource.
- 7:17SPEAKER_03: And free Microsoft software, which is nice if you don't have any computer.
- 7:21SPEAKER_03: That's in there.
- 7:22SPEAKER_03: So that's a nice package.
- 7:24SPEAKER_00: So we all know that Jim loves funny clips.
- 7:27SPEAKER_03: Yes, I do.
- 7:28SPEAKER_00: I love them too.
- 7:29SPEAKER_03: Yeah, Bridget found this one.
- 7:31SPEAKER_00: Yes, I have one for you today.
- 7:32SPEAKER_03: Let's let's okay.
- 7:33SPEAKER_03: Let's see what you call funny here.
- 7:35SPEAKER_00: Okay.
- 7:36SPEAKER_00: Let's check it out.
- 7:37SPEAKER_01: Let's check it out.
- 7:38SPEAKER_01: Sorry for the way my manager said this is the best price we can do on the vehicle there.
- 7:41SPEAKER_01: Can you go?
- 7:42SPEAKER_01: Any lower?
- 7:42SPEAKER_01: If I go any lower, do we have a deal?
- 7:44SPEAKER_01: Yeah.
- 7:45SPEAKER_01: Congratulations.
- 7:47unknown: Okay.
- 7:48SPEAKER_00: Silly humor, which I love.
- 7:50SPEAKER_00: And that comes from Review Chevy, Riley Stevenson.
- 7:54SPEAKER_00: So I thought that was clever and funny.
- 7:56SPEAKER_00: And I like it.
- 7:57SPEAKER_00: Thought I'd share that with the audience.
- 7:59SPEAKER_00: So anyway, that's right.
- 8:02SPEAKER_00: Okay.
- 8:03SPEAKER_00: How about we bring Jim Sabino on?
- 8:05SPEAKER_03: I'd love, I'd love to.
- 8:06SPEAKER_03: He's he's ready to go.
- 8:07SPEAKER_03: Uh, and and I want to hear what he has to say about all of this.
- 8:10SPEAKER_03: So uh the service drive is no longer the only way to keep customers coming back.
- 8:14SPEAKER_03: Dealers are taking service to the customer.
- 8:17SPEAKER_00: That's right.
- 8:18SPEAKER_00: Jim Sabino, fixed operations director at All American Auto Group, joins us now to talk first appointment retention, mobile service, and pickup and delivery and how these options can drive loyalty.
- 8:29SPEAKER_03: Wow.
- 8:30SPEAKER_00: Welcome into the show, Jim.
- 8:31SPEAKER_03: Good to see you.
- 8:32SPEAKER_02: Yeah, you too.
- 8:33SPEAKER_02: Good afternoon, Bridget and Jim.
- 8:35SPEAKER_02: Yeah.
- 8:35SPEAKER_02: Glad to be here.
- 8:36SPEAKER_00: Thank you for joining us.
- 8:37SPEAKER_00: Let's start with that first service appointment.
- 8:39SPEAKER_00: How important is it to get that first one, that first visit on the books before the customer even leaves the showroom?
- 8:47SPEAKER_02: It it's it's it's it's a massively uh important step in the process that a lot of dealers don't look at it that way, and they really are missing uh the opportunity for that customer attention to keep that customer under your roof.
- 9:02SPEAKER_02: Um, we do a first appointment at time of delivery.
- 9:05SPEAKER_02: There's not a vehicle that gets delivered at any of our stores that do not have a first appointment in the books at time of delivery, not one.
- 9:13SPEAKER_02: Same thing with used cars also.
- 9:15SPEAKER_02: Used cars are also getting uh first services set up, also.
- 9:18SPEAKER_02: Interesting.
- 9:19SPEAKER_02: It's incredibly, incredibly important um to start the cycle, the life cycle of your service customer.
- 9:26SPEAKER_02: Once the sale is complete, then we have to rely on the service revenue, and that's if they don't come into that service drive, there is no revenue being generated through that life cycle.
- 9:36SPEAKER_02: So it is an incredible important step that we take very seriously and we we um we do very well.
- 9:42SPEAKER_02: It takes a lot of work, but we do very well with it.
- 9:46SPEAKER_03: Walk me through logistically what that looks like.
- 9:49SPEAKER_03: Does the salesperson accompany the customer all the way back to the service drive and introduce them to a service advisor?
- 9:55SPEAKER_03: How how what does that look like?
- 9:57SPEAKER_02: Yeah, so it depends on the hours of operation, whether it is.
- 9:59SPEAKER_02: If service is open, then the there is a warm and very uh subtle uh introduction to service through the sales department.
- 10:06SPEAKER_02: They walk them back, introduce them either to a service advisor or right to the uh the cashier receptionist desk.
- 10:12SPEAKER_02: They make the appointment right there.
- 10:14SPEAKER_02: And typically um we offer mobile service for the first appointment, and and that is it's an introduction to mobile service if they've ever had it before.
- 10:22SPEAKER_02: Yeah.
- 10:23SPEAKER_02: Uh some of our repeating customers have already had it, they understand it, they get it, and they request it.
- 10:28SPEAKER_02: Um and then we also piggyback that with pickup and delivery.
- 10:31SPEAKER_02: Not every car is eligible for mobile service due to locations, due to maybe they live in an apartment complex, maybe they live um in an in where they park underground, so it's not really you know mobile service accessible.
- 10:44SPEAKER_02: Right.
- 10:45SPEAKER_02: So then at that time we offer pickup and delivery, which is another tremendously convenient option, and and people really take advantage of that too.
- 10:52SPEAKER_02: Okay.
- 10:53SPEAKER_02: Um whatever it takes to get that first service done, and we really raise the bar in a hospitality type of a format, right?
- 11:01SPEAKER_02: So we're in the service business, but we bring in a hospitality feel where it's welcoming and they want to come back, they want to return.
- 11:10SPEAKER_03: What so what happens if the service department is closed, sales department is open, whether it be on the weekends or or evenings or what have you?
- 11:18SPEAKER_03: Because as you know, a lot of deliveries might take place after seven or eight o'clock at night.
- 11:22SPEAKER_02: Of course, and that's a great point.
- 11:23SPEAKER_02: So a lot of that that happens.
- 11:25SPEAKER_02: They'll the following morning we get an email list on any deliveries done outside of the service hours.
- 11:30SPEAKER_02: Okay.
- 11:30SPEAKER_02: The next day, the next business day, whether it's Saturday, it's Monday, and if it's during the week, it's the next the next weekday.
- 11:36SPEAKER_02: We make a contact, we email them, and then we make a phone call as an introduction to the service department and just reconfirm the uh the appointment that was set.
- 11:44SPEAKER_02: The sales has the ability to set the appointment.
- 11:46SPEAKER_02: They can do it right through an app, they can do it through the online scheduler, um, which is very convenient.
- 11:51SPEAKER_02: And and we do the follow-up the following day if it's outside of service hours.
- 11:56SPEAKER_02: Okay.
- 11:56SPEAKER_00: Great.
- 11:57SPEAKER_00: So, what metrics do you watch to know whether your retention efforts are actually working?
- 12:02SPEAKER_00: Is that the next appointment booked, customer pay frequency, or longer-term return rates?
- 12:06SPEAKER_00: What do you what do you look at?
- 12:08SPEAKER_02: We look we look at them all, and and and you know, we're a Ford dealership, so Ford is very, very in tune with this too, and they send us weekly statistics of first appointment retained.
- 12:18SPEAKER_02: But so we do our own in-house through our CRM, and based and we base that up upon deliveries, um, appointments kept because every every absolute uh delivery has a appointment, so we kind of watch that.
- 12:31SPEAKER_02: If it's a missed appointment, we do remote like soft what we call as gentle nudges starting a week prior to the appointment date.
- 12:37SPEAKER_02: We start, you know, we do texting or emailing, very gentle, nothing, no, nothing crazy.
- 12:41SPEAKER_02: Um, just a hey, just a nice friendly reminder.
- 12:44SPEAKER_02: And if there's any questions or or changes that need to be done, please reach out.
- 12:47SPEAKER_02: We'll work with we'll accommodate their schedule.
- 12:49SPEAKER_02: Obviously, life happens, things, you know, things come up that aren't planned, or if they can't make it, we'll rearrange or schedule, it will change the pickup time, or the if it's a nine o'clock appointment and maybe they can't do it, maybe we'll set it at 2 or 2.30 in the afternoon the same day if that works.
- 13:03SPEAKER_02: So, whatever it takes to be convenient and make those appointments possible, we will.
- 13:07SPEAKER_02: And the metrics that we look at are a combination of our own and the ones that Ford Motor Company provides to us.
- 13:13SPEAKER_03: Thanks.
- 13:14SPEAKER_03: Once that first visit is over, Jim, what are the most effective things that a dealer can do to get that customer back?
- 13:23SPEAKER_02: Um, there's a lot of different things.
- 13:25SPEAKER_02: And and and you know, not one size doesn't fit all, so it's kind of preference to your staff and to the customers.
- 13:31SPEAKER_02: And one of the things that we do is we schedule the next appointment at completion.
- 13:36SPEAKER_02: So after that first one, we'll make the second one before they leave the dealership.
- 13:40SPEAKER_02: And if it's a virtual, if it's off-site where it's mobile, the mobile service coordinator will set that up in the CRM.
- 13:45SPEAKER_02: So it's there.
- 13:46SPEAKER_02: Doesn't mean it's a hard yes that you know on six months from now that you're gonna be available, but it's in the system.
- 13:52SPEAKER_02: So the reminder is there.
- 13:54SPEAKER_02: Um and and that's one of the things we do.
- 13:56SPEAKER_02: And then we have, you know, obviously some vendors that we work with very closely that kind of track um uh service appointment intervals.
- 14:05SPEAKER_02: And then Ford has a great tool called the VCP, which is vehicle care portal, which is a absolutely um uh phenomenal tool that the motor company provides to us, and it all works with connected vehicle data.
- 14:19SPEAKER_02: Okay, and that indicates vehicles you know, service is needed soon, vehicle service is needed now, um, any type of a fault, a check engine light, a low tire pressure, any type of thing that we can see.
- 14:29SPEAKER_02: If it's a connected vehicle, we have access to seal that information.
- 14:32SPEAKER_02: And it's real time, so we can reach out.
- 14:34SPEAKER_02: Once we see that, we can reach out and kind of address that with the customer.
- 14:38SPEAKER_02: And and you know, they're kind of shocked that we're reaching out, and it's based on a trigger that that we saw in a vehicle care portal, whether it's a check engine light or a reminder for an overdue uh oil change or tire rotation.
- 14:50SPEAKER_02: Who do you think you are?
- 14:51SPEAKER_03: Tesla?
- 14:54SPEAKER_03: No, that's pretty cool though.
- 14:55SPEAKER_03: That's a nice feature, without a doubt.
- 14:57SPEAKER_03: Where where do you see stores losing people between visits?
- 15:01SPEAKER_02: Um, not paying attention.
- 15:03SPEAKER_02: Yeah, not looking, not setting the first appointment is the first major, major fall.
- 15:08SPEAKER_02: That's that that's a fall off a cliff.
- 15:09SPEAKER_02: That's not even a misstep.
- 15:10SPEAKER_02: Yeah, if you don't get them at their first service at time of delivery, it's so hard to get them and recapture them in six months.
- 15:17SPEAKER_02: And if you don't get them for the first and get them locked in and committed, the the the second and third become that much more difficult to get them for those.
- 15:25SPEAKER_02: Right.
- 15:26SPEAKER_02: So the life cycle gets broken if you don't treat it right out of the gate, if you don't treat it properly, for sure.
- 15:34SPEAKER_00: So pickup and delivery, mobile service, loaners, all of these options come with costs and logistical challenges.
- 15:40SPEAKER_00: How do you decide how much convenience to offer while still protecting the profitability of the service department?
- 15:46SPEAKER_03: Yeah, it sounds like you're really overboard.
- 15:48SPEAKER_02: Well anyway.
- 15:49SPEAKER_02: Yes, so so yes, Bridget, you're you're very, very true.
- 15:52SPEAKER_02: Cost is an incredibly um uh a tough navigating road.
- 15:57SPEAKER_02: Um, loaners, we've decreased our fleet based on the pickup delivery and the mobile service.
- 16:01SPEAKER_02: So we've cut, we typically ran, I'm gonna tell you, before mobile service and pickup delivery really became a thing, we had about 75 loaner cars in each store.
- 16:11SPEAKER_02: Um the the let's use our parameters location as an example.
- 16:15SPEAKER_02: We current currently have about 25 loaners.
- 16:18SPEAKER_02: So we were able to reduce 50 loaners out of that fleet based on our pickup and delivery and our mobile service offerings.
- 16:25SPEAKER_02: Because they just the people don't need them.
- 16:27SPEAKER_02: If you can just take the service to them, yeah, then they don't need a loaner car because they can they can just operate, they can do go about their day if we're outside in the driveway or if we're outside in their parking lot.
- 16:38SPEAKER_02: Um pick up and delivery.
- 16:40SPEAKER_02: If they work from home and we send drivers to the house, grab the vehicle, bring it to the service department, get it serviced.
- 16:45SPEAKER_02: Yeah, complete it, bring it right back.
- 16:47SPEAKER_02: So no need for a loaner car.
- 16:49SPEAKER_02: So there's a huge cost savings there.
- 16:52SPEAKER_02: Um, but keeping the the revenue in your roof and not having a customer defect and go to an independent or to somebody else, it it it it it works.
- 17:03SPEAKER_02: And and it's not an easy thing because you have to manage it every single day.
- 17:06SPEAKER_02: Yeah, you have to maximize your schedule, you have to run efficient routes in your mobile service vans, um, the drivers, you know, that everything has a cost.
- 17:13SPEAKER_02: Everything has a cost.
- 17:14SPEAKER_02: But when it's managed properly and efficiently, it does pencil out.
- 17:19SPEAKER_03: Do any of the service advisors see mobile service, Jim, as competition or a threat to their income if they're not writing that service, or or are they writing that service?
- 17:30SPEAKER_02: No, no, we have dedicated mobile service coordinators that handle all that.
- 17:34SPEAKER_02: In the beginning, that's another great question and point.
- 17:36SPEAKER_02: In the beginning, yes, the service advisors were a little uh uneasy about it.
- 17:41SPEAKER_02: They thought, oh, yeah, losing money, this is ridiculous.
- 17:43SPEAKER_02: You know, it's the it that's the normal remote.
- 17:46SPEAKER_02: Of course.
- 17:47SPEAKER_02: Um once they saw, you know, that it wasn't hurting them versus helping the store in a hole, then they all bought into it.
- 17:54SPEAKER_02: And honestly, some of them, um this is really a good story, is that a lot of times where we have special order parts, and if it can be done mobily, the service advisor will talk to the mobile service team and have those parts installed on a mobile service job to prevent the customer from returning to the dealership for a second or possibly a third visit.
- 18:15SPEAKER_02: Right.
- 18:15SPEAKER_02: So that helps them and it brings a lot of credibility to the customer because um you know the the advisor thought enough of them not to inconvenience them with another trip back to the store.
- 18:25SPEAKER_02: That hey, let me bring the part to you and we'll install it at your house.
- 18:28SPEAKER_03: Do you ever which works out really well?
- 18:30SPEAKER_03: Oh, I would imagine.
- 18:30SPEAKER_03: Do you ever ask yourself how the industry or how you were in the industry this long without mobile service?
- 18:36SPEAKER_03: It seems like you know what I mean?
- 18:38SPEAKER_03: It seems like uh one of these how come we weren't always doing this?
- 18:42SPEAKER_02: Yeah.
- 18:43SPEAKER_02: True point, true, very true.
- 18:44SPEAKER_02: And it does, it does increase so much the convenience level.
- 18:48SPEAKER_02: Uh, it increases our capacity without expanding, you know, days, brick and mortar.
- 18:52SPEAKER_02: Um, and and you know, true, true uh transparency.
- 18:55SPEAKER_02: In the beginning, I wasn't a believer.
- 18:58SPEAKER_02: I I full, I've got to tell you, I was not a believer.
- 19:01SPEAKER_02: Uh, and I saw this, I saw Ford rolling this out, and I'm like, I I you know, I had the typical no, this isn't gonna work.
- 19:10SPEAKER_02: Um, and then I think I've I don't know if I said this on your show, but I I've said this, I've watched Ed, as we all know, Ed Roberts down.
- 19:18SPEAKER_02: And I and I watched him grow and grow and grow, and and I'm like, wow, he's onto something big.
- 19:24SPEAKER_02: Yeah.
- 19:25SPEAKER_02: I sat in the background and I took notes and I took notes and I watched and I watched and I watched.
- 19:29SPEAKER_02: And then I just we started growing and growing and growing, and you know, not at his level, but you know, maybe one day, but we we have grown out, you know, we started with one, yeah.
- 19:37SPEAKER_02: We started with one van, and we currently have 17 across the fleet.
- 19:40SPEAKER_02: Oh my gosh.
- 19:41SPEAKER_02: Oh wow.
- 19:41SPEAKER_02: It's a respectable number, you know, compared to what's out there throughout the country, you know, Ed being probably the biggest, and not probably is the biggest in the country, Ed and Jeremy.
- 19:49SPEAKER_02: Um, but but it it is um it it's humbling to know that that I I I was I I kept an open mind, a very, very open mind.
- 19:59SPEAKER_02: Yeah.
- 19:59SPEAKER_02: Because I, you know, it was a hard, that wasn't a hard no, but it was a no.
- 20:02SPEAKER_02: I was like, this is it, they're crazy, this is gonna work, and and here we are now.
- 20:06SPEAKER_02: And I'm I'm bought in Hookland Sinker, it's a success story, it works.
- 20:10SPEAKER_02: I'm a believer.
- 20:10SPEAKER_02: Yeah.
- 20:11SPEAKER_02: Um and and you where where's it it should have come out 15, 20 years ago.
- 20:15SPEAKER_03: That's the two.
- 20:16SPEAKER_03: I'm told by a Ford dealer that the majority of Ford dealers still don't offer it.
- 20:21SPEAKER_03: Is that is that true?
- 20:23SPEAKER_03: Um, not to get you in trouble out of anything.
- 20:28SPEAKER_02: I mean, there's approximately there's approximately 45 mobile service units, 4,500.
- 20:33SPEAKER_02: I apologize, 4,500 mobile service units from Ford, Ford Lincoln under in the country.
- 20:38SPEAKER_02: Okay.
- 20:38SPEAKER_02: So it's a decent amount.
- 20:39SPEAKER_02: A lot of the small, the small, small little dealers in the rural areas don't offer it.
- 20:44SPEAKER_02: It just doesn't make sense when their customers are 30, 40, 50 miles away from them.
- 20:48SPEAKER_02: It just doesn't make sense.
- 20:49SPEAKER_02: Yeah, they create small little populations.
- 20:51SPEAKER_02: Um, but a lot of the city and suburbs are are doing, or they have them.
- 20:58SPEAKER_02: They have at least one.
- 20:58SPEAKER_02: They're they're bought into it.
- 20:59SPEAKER_02: Ford has done a great job supporting it, um, promoting it, helping the dealers uh market it.
- 21:05SPEAKER_02: And and it it if if you're not in it, um, you're missing out as a Ford dealer.
- 21:10SPEAKER_03: Yeah, I'm surprised other OEMs haven't followed suit on this.
- 21:13SPEAKER_03: So the what the way Ford has, because every they're starting to.
- 21:17SPEAKER_02: I'm not starting to, they have been.
- 21:19SPEAKER_02: Some dealers have uh OEMs have really kind of watched Ford the end's success story, but Ford is so far down the road uh in its deployment of vans, in its marketing, and in you know, the the just the awareness campaign that it's it's you know, there are a lot of Mercedes Hyundai.
- 21:34SPEAKER_02: There's a couple of GMs started it.
- 21:36SPEAKER_02: I'm not sure where they are with it now, but there are some out there that that are trying to uh to make it work.
- 21:42SPEAKER_03: Yeah, because this this works as much for service and fixed ops as it does for sales.
- 21:46SPEAKER_03: Because after you purchase that that Ford, you know, from your company uh there at All American Auto Group, um you know, you're not gonna be as apt to jump brands bec if in the event that other brand doesn't have mobile service and you're
- 22:02SPEAKER_02: Correct.
- 22:07SPEAKER_02: So Ford calls it the a remote experience, right?
- 22:10SPEAKER_02: Remote experience is either going to be a mobile service or a pickup and delivery.
- 22:12SPEAKER_02: Okay.
- 22:12SPEAKER_02: When you put them two together, it's yes, it it spells convenient in capital bold letters.
- 22:17SPEAKER_02: Yeah.
- 22:18SPEAKER_02: Yeah.
- 22:18SPEAKER_02: Every every step of the way.
- 22:19SPEAKER_02: Sure.
- 22:20SPEAKER_00: So mobile service can handle routine maintenance and certain repairs, but the service drive also creates opportunities for inspections, additional work, or even trading conversations.
- 22:30SPEAKER_00: How do you make sure you're not giving up those opportunities when you take the service experience to the customer?
- 22:36SPEAKER_02: Correct.
- 22:37SPEAKER_02: And also great, great point, Bridget.
- 22:39SPEAKER_02: So my analogy is very simple.
- 22:41SPEAKER_02: So our mobile service vans are like an urgent care, and our service drive is like a hospital.
- 22:47SPEAKER_02: So that that that's really the way it is.
- 22:48SPEAKER_02: And you know, we do simple, quick and easy, uh light maintenance repairs, and then we do a lot of recalls.
- 22:54SPEAKER_02: Okay.
- 22:55SPEAKER_02: We do a we do a lot.
- 22:56SPEAKER_02: Seven out of ten recalls from Ford Motor Company can be done on the road.
- 23:01SPEAKER_02: So those vans are really booked every day with recalls, every single day, which is which is a big plus.
- 23:06SPEAKER_02: It fills a lot of the gaps.
- 23:08SPEAKER_02: Um we do multi-point inspections on the road, but they're not as thorough as they are as in-shop inspections, but we do provide them.
- 23:16SPEAKER_02: Okay.
- 23:16SPEAKER_02: Um and the service drive acquisition, as you brought up, is kind of done digitally.
- 23:22SPEAKER_02: It's not like where if it's in the service drive, used car manager or whoever handles that acquisition part will come out and put his eyes on the or hit his or her eye on the vehicle, kind of eyeball it, meet and greet the customer, um, and kind of have a little conversation right there.
- 23:37SPEAKER_02: Mobile service, it's gener, you know, our used car acquisition is generated through open ROs.
- 23:42SPEAKER_02: So every open RO, whether it's in shop or off-site in the mobile, is that gets into the CRM and then they start the process.
- 23:49SPEAKER_02: They started data mining and seeing if there's any equity and things like that.
- 23:53SPEAKER_02: And then if they have to, they'll reach out to the text or email the customer and ask them if they're interested, if they're up exploring opportunities to you know, trading in or you know, trading up.
- 24:02SPEAKER_02: And um, and and it's not as clean as it is in shop, but there still is opportunities when it's off site.
- 24:08SPEAKER_03: Yeah.
- 24:09SPEAKER_03: Yeah.
- 24:10SPEAKER_03: That makes sense.
- 24:10SPEAKER_03: Yeah, that makes sense.
- 24:11SPEAKER_03: By the way, how is business at your at your store?
- 24:15SPEAKER_02: It it it's business is is good.
- 24:17SPEAKER_02: It it's not, you know, listen, it's been a it's been a uh an up and down year.
- 24:21SPEAKER_02: It hasn't been a banner, you know, knock down the wall year, but it's you know, we've had good months, we've had okay months.
- 24:26SPEAKER_02: Okay.
- 24:27SPEAKER_02: Um October is is a decent month, September was a very good month.
- 24:30SPEAKER_02: Um, as you know, you know, on the sales side, it it it really dictated.
- 24:33SPEAKER_02: The manufacturer dictates a lot of you know on interest rates, on rebates, on incentives and stuff like that.
- 24:39SPEAKER_02: So that kind of dictates and sets the pace for the front.
- 24:42SPEAKER_02: The back is steady.
- 24:43SPEAKER_02: We're we're very, very blessed.
- 24:45SPEAKER_02: Um, we have a very good um fleet uh service department, we have a very good penetration into that market, and then we've we've hyper, hyper focus on retail customers uh because that that's really the life, that's the lifeblood of the of the dealership.
- 24:58SPEAKER_02: So if you can keep that customer in your life cycle in the service department, I I think that market data is showing 70 or 73 percent of that those times the customer will repurchase from you.
- 25:10SPEAKER_02: Yeah, if they defect and go to an independent or possibly another store or something like that, that dramatically drops.
- 25:16SPEAKER_02: So we we know that and we take that very seriously.
- 25:19SPEAKER_02: That's why we put such a big emphasis on keeping them in your under your roof for service.
- 25:25SPEAKER_02: So with the time when the car is two years, three years old, so that used car acquisition can start to take place.
- 25:30SPEAKER_02: Plus, we want the revenue that every time the car comes through the service drive, right?
- 25:34SPEAKER_02: So it's as the older the car gets, the usually the the ROs increase in dollar amount and parts more parts in labor are required than the first and second and third visits.
- 25:44SPEAKER_02: Um but if if they're not under your roof and they're not coming to you for service, it's it that's a huge, huge miss and a possibility of a miss in the sales department for their next repurchase.
- 25:54SPEAKER_02: Totally agree.
- 25:55SPEAKER_02: Yep.
- 25:56SPEAKER_03: The the showroom sells the first car, service department sells every car thereafter, right?
- 26:01SPEAKER_03: Correct.
- 26:02SPEAKER_03: Correct.
- 26:02SPEAKER_02: And and we are dialed dialed into that.
- 26:06SPEAKER_00: Before we let you go, how are you making sure the customer knows, especially for things like recalls, that you have this available once they've left the showroom?
- 26:15SPEAKER_02: We we we always market and camp, we do market campaigns, email campaigns, uh, we we do all kinds of we do um uh events like throughout like with sidewalks.
- 26:25SPEAKER_02: You know, we do all kinds of like you know, municipality events or or um you know, uh uh like Memorial Day parades and things like that.
- 26:32SPEAKER_02: And we do a lot of marketing, and our vans are on the road all day, right?
- 26:35SPEAKER_02: So you see the vans driving around town, you see them on the highway, you see them in in a parking lot, you see them in your neighbor's driveway.
- 26:40SPEAKER_02: That's great.
- 26:41SPEAKER_02: Um so we constantly campaign and we have banners and and all kinds of handouts in the dealership promoting mobile service, promoting pickup and delivery.
- 26:49SPEAKER_02: It's in our showroom, it's in our service drive, it's in our cashier, it's it's a little banner in front of every service advisor desk.
- 26:56SPEAKER_02: Um so so we do market it, and then obviously we we get the benefit of Ford marketing, and they promote it and they push it.
- 27:03SPEAKER_02: So they that's on a national level, and then we do it within our active database and our CRM.
- 27:08SPEAKER_02: That's that we do campaigns.
- 27:09SPEAKER_02: We do social media, we're big on social media as far as you know promoting uh zero percent.
- 27:13SPEAKER_02: Now Ford just came out with zero percent interest for the next two weeks on Explorer F-150.
- 27:17SPEAKER_02: So we're doing massive campaigns through social media on that.
- 27:20SPEAKER_02: Um, and then we do we do kind of uh comedy skits and then we do serious skits with our service advisors, with our technicians, our mobile service team, things like that.
- 27:30SPEAKER_02: And it's just an awareness, it's a campaign.
- 27:32SPEAKER_02: And and that's what you have to do.
- 27:33SPEAKER_02: You have to constantly give the people a reminder what you offer.
- 27:37SPEAKER_02: That's right.
- 27:38SPEAKER_02: Constantly.
- 27:38SPEAKER_02: Don't don't ever let them forget about you.
- 27:40SPEAKER_02: Always remind them that we're here.
- 27:42SPEAKER_02: That's right.
- 27:42SPEAKER_00: 100%.
- 27:43SPEAKER_02: Great approach.
- 27:44SPEAKER_02: Yeah, great approach.
- 27:44SPEAKER_00: Jim Sabino, fixed operations director at All American Auto Group.
- 27:48SPEAKER_00: Thank you so much for joining us.
- 27:49SPEAKER_00: This has been great.
- 27:50SPEAKER_03: Great catching up with you.
- 27:51SPEAKER_03: Thank you.
- 27:51SPEAKER_03: Thank you.
- 27:52SPEAKER_03: Thank you.
- 27:53SPEAKER_03: Thank you.
- 27:53SPEAKER_03: Yeah, he's on it.
- 27:54SPEAKER_03: He is on it.
- 27:55SPEAKER_00: Yes.
- 27:56SPEAKER_00: That was um that last question was we have a link in, and I didn't even I didn't know they did the recalls.
- 28:01SPEAKER_00: They would come out for recalls.
- 28:02SPEAKER_00: So and we've gotten the recall letters on a couple of things and still need to have them done.
- 28:06SPEAKER_00: Yeah, we're here.
- 28:07SPEAKER_03: And I was wondering too at the recalls, because as you know, recalls make a lot of money for dealers because that card comes in for a recall, and obviously the recall is free, but then it's an opportunity for the service advisor to upsell from there and say, Oh, by the way, you know, we do a walk around presentation and you know, or not presentation, but right uh MPI a multi-point inspection and sell sell more.
- 28:27SPEAKER_03: But so that's interesting.
- 28:28SPEAKER_03: But uh yeah, he's killing it.
- 28:30SPEAKER_03: Wow, oh my god.
- 28:31SPEAKER_03: And he sounds so enthused about it.
- 28:32SPEAKER_03: I know he's probably written a 200% absorption rate in that store.
- 28:37SPEAKER_00: Good for him.
- 28:38SPEAKER_03: Good for him.
- 28:39SPEAKER_00: So we have before our next guest comes on, we do have a video that you want to.
- 28:43SPEAKER_03: I yeah, I do I do have a video that I want to show here because it sets up the next guest that we've got coming on.
- 28:49SPEAKER_03: And and many in the industry have seen this young man and the work that he and his dad do.
- 28:54SPEAKER_03: We've had them on the show.
- 28:55SPEAKER_03: These guys, these guys are great.
- 28:57SPEAKER_03: Uh his dad, I think, is my age.
- 28:58SPEAKER_03: We you know, he got into the business around the time I got into the business, and uh they do great work.
- 29:03SPEAKER_03: Um, and they've put together a company, but I want to show you this video because I think it speaks for itself and what they do, and then we can talk uh to Zach on the on the tail end and on the other side of this.
- 29:14SPEAKER_01: So let's let's roll that.
- 29:16SPEAKER_01: Southtown Auto Group in Noonan, Georgia.
- 29:19SPEAKER_01: You just got caught red-handed by Car Edge, and it's your turn to get exposed.
- 29:22SPEAKER_01: For those of you that are unfamiliar, my name's Zach with a company called CarEdge, and every single day we shop thousands of dealerships nationwide for our car buying service, and we keep track of every single message and then grade dealers based on their transparency from A to F.
- 29:35SPEAKER_01: A couple days ago, we had a customer interested in purchasing this 2026 Chevy Silverado Colorado LT from Southtown Auto Group in Noonan, Georgia.
- 29:42SPEAKER_01: And you can see here on their website they have the price listed at$32,835.
- 29:48SPEAKER_01: If I click on that pricing disclaimer, you can see here a modal pops up, includes all applicably applicable, excuse me, factory incentives which may not combine with special APR.
- 29:57SPEAKER_01: Okay.
- 29:57SPEAKER_01: Now, as part of our car buying service, we keep track of every message between us and blue and the dealership in white.
- 30:02SPEAKER_01: And you can see here we go back and forth with the dealership and we ask them for the price, and you can see there it's$39,055.
- 30:09SPEAKER_01: So again, what's advertised on the dealer website is$32,835, and then their$897 dock fee.
- 30:15SPEAKER_01: And they quote us$39,055.
- 30:18SPEAKER_01: We push back, and then the dealership says, where are you getting the$33 number from?
- 30:21SPEAKER_01: And you can see the dealer says here, you are looking at the internet price, which in order to get that price, you must have a trade-in of$2012 or newer and also finance with GM to get that price.
- 30:30SPEAKER_01: Now, this is the dealer website right now.
- 30:32SPEAKER_01: Where does it say that up here?
- 30:33SPEAKER_01: I literally click on pricing disclaimer, and again, it doesn't say that anywhere.
- 30:38SPEAKER_01: To make matters worse, if you go on Car Guru's and you find this vehicle on Car Guru's website, they also advertise it at$33,732.
- 30:45SPEAKER_01: So the dealer's price plus the dock fee.
- 30:47SPEAKER_01: And Car Guru says, hey, yeah, this price includes the dealer fee, which you can see right there, the$32,835 plus$897.
- 30:53SPEAKER_01: Nowhere on here does it mention that there are these things that are contingent to actually get that price.
- 30:58SPEAKER_01: And now to be clear here, New York City actually just filed a lawsuit against Car Gurus for this type of stuff.
- 31:03SPEAKER_01: And all year the FTC's been going after car dealerships for doing this as well.
- 31:07SPEAKER_01: What's even crazier is if you go to the lawsuit from New York City against Car Gurus, you'll actually see that they're citing Car Edge down there in the Dealer Transparency Index.
- 31:15SPEAKER_01: And so it shouldn't be too surprising that Southtown Chevrolet Buick GMC gets a C grade from CarEdge.
- 31:20SPEAKER_01: Some of their car deals don't have these games, but many of them do, and that's why they have a C.
- 31:24SPEAKER_01: Now we've graded 24,391 dealers nationwide.
- 31:27SPEAKER_01: Just go to CarEdge.com, click on Find Dealers up there at the top.
- 31:30SPEAKER_01: And we have a growing network, 163 certified transparent dealers that just commit to upfront pricing, no hidden fees, or surprise add-ons.
- 31:37SPEAKER_01: So Southtown Auto Group and Car Gurus, please do better.
- 31:40SPEAKER_01: This type of stuff makes it really hard for good dealers to compete, and obviously it wastes customers' time.
- 31:45SPEAKER_01: Alright, folks, let me know what city, state, and dealership you want me to do next.
- 31:49SPEAKER_00: So as you can see, the price a dealer advertises and the price a customer actually pays doesn't always match.
- 31:56SPEAKER_00: So more scrutiny with the FTC.
- 31:58SPEAKER_03: That's right.
- 32:00SPEAKER_03: Zach Shevska, president and CEO of CarEdge, joins us to talk about dealer pricing practices and why transparency is becoming a bigger issue for the entire industry.
- 32:09SPEAKER_03: Zach, welcome back to CBT.
- 32:11SPEAKER_03: Very much appreciate it.
- 32:12SPEAKER_03: Welcome.
- 32:13SPEAKER_03: Your producer told me we were going to talk fantasy football.
- 32:15SPEAKER_01: So I'm caught entirely up there.
- 32:17SPEAKER_01: No, that's all.
- 32:19SPEAKER_01: I'm just teasing.
- 32:20SPEAKER_01: Thank you guys.
- 32:21SPEAKER_01: Grateful to be here as always.
- 32:22SPEAKER_03: Yes.
- 32:23SPEAKER_03: And of course, you know, for the last two minutes there, we watched that video that you do, and uh you do a good job at them.
- 32:29SPEAKER_03: Very thorough.
- 32:30SPEAKER_03: Uh I'm gonna get a lot of hate mail because I had you on the show.
- 32:33SPEAKER_03: No, no, we won't.
- 32:34SPEAKER_03: We won't.
- 32:35SPEAKER_03: It's important to it's very important.
- 32:37SPEAKER_03: It's so much work to do if we get anybody that says you shouldn't have had him on.
- 32:41SPEAKER_03: Because I think the work that you're doing, you're bringing it to light to dealers and to the Southtown Motors to say, hey, A, do you know that this is happening right now in your dealership?
- 32:51SPEAKER_03: Because I, as a former dealer myself, there there's a lot of things that happen inside of dealerships, especially the larger the group, that the that sometimes the dealer principal doesn't know, but they're on the hook for this, not that particular manager or marketing manager, what have you.
- 33:04SPEAKER_03: So talk to us about this.
- 33:06SPEAKER_03: This this is just a problem that just exists big time, right?
- 33:10SPEAKER_01: Still, still.
- 33:11SPEAKER_01: I mean, Jim, I've been in the business seven years.
- 33:13SPEAKER_01: I appreciate you know mentioning my dad and great guy.
- 33:16SPEAKER_01: Bridget for both of you.
- 33:17SPEAKER_01: Like my observation, super naive, you know, I'm 31, I'm early in my career.
- 33:22SPEAKER_01: My observation is that there is no commercial incentive to be transparent.
- 33:25SPEAKER_01: There are a handful of groups out there that have demonstrated this that it can work.
- 33:28SPEAKER_01: I'm thinking of the Schamps, I'm thinking the Mullinaxes, the Earl Stewarts.
- 33:32SPEAKER_01: There are examples of dealers who have, for you know, many decades now demonstrated that there is a different business model, but the endemic business model is one that the third-party marketplaces, whether they mean to or not, endorse.
- 33:45SPEAKER_01: It's one that is incredibly profitable, and it's one that it's very difficult for dealers who have operated in those ways to transition away from because the path to become a transparent dealer typically means many years of making less money, and obviously on the staff side, having to retrain people or maybe letting go of people who have been, you know, supporting you for decades or many, many years.
- 34:06SPEAKER_01: And so for me, with the work that we do at CarEdge, it's all about how do we build a commercial incentive to be transparent, to be fair, and to be efficient.
- 34:14SPEAKER_01: And um, you know, FTC threats and things like that, sure, that's real.
- 34:18SPEAKER_01: That's the stick.
- 34:19SPEAKER_01: The carrot is, in my opinion, a better business model, happier staffs, uh, and quite frankly, better competition against the carvanas of the world because I'm actually the biggest proponent of the franchise dealer system.
- 34:29SPEAKER_01: I I don't want to see the world become every single vehicle is bought and sold at Carvana.
- 34:34SPEAKER_01: Yeah.
- 34:34SPEAKER_01: We should just lead with transparency, fairness, and efficiency.
- 34:36SPEAKER_01: And I recognize it's a it's a difficult, challenging path to get there, but it's a worthy pursuit.
- 34:41SPEAKER_03: Yeah, there's no question.
- 34:42SPEAKER_03: And uh there's so many dealers that are still, you know, not on board with this.
- 34:47SPEAKER_03: And uh I'm sure that when they see uh, you know, items like this that you're pushing out on on the internet, then uh they're you know sitting there going, oh my god, when are we gonna get hit?
- 34:56SPEAKER_03: You know, it's either from the FTC or it's gonna be from Zach doing his thing out there that that they don't want consumers in their market to see either.
- 35:05SPEAKER_03: So the you know, the the remedy dealers, and back me up on this, Zach, is just set up and fly right.
- 35:11SPEAKER_03: You know, do what you're supposed to be doing.
- 35:13SPEAKER_03: Every dealer that I talk to since the FTC rulings and the fact they've come down on dealers have said this is a good thing for our industry.
- 35:21SPEAKER_03: It's gonna level the playing field, it's gonna take away that stigma that everybody has towards dealers and car salesmen, and uh, and and let's get that behind us as quickly as we can.
- 35:31SPEAKER_03: It's not gonna go any, you know, quickly overnight or anything just because of this, but it can certainly be the first step on the on the journey, right?
- 35:40SPEAKER_01: Definitely.
- 35:41SPEAKER_01: And and again, to double down on it, I'm human just like the you know, everyone else who's a part of producing this show, both of you, the people that are watching, incentives drive behavior.
- 35:50SPEAKER_01: Right.
- 35:50SPEAKER_01: And the FTC threat is certainly real in the sense that do you really want to be associated in a press release that I think maybe hurts your blue sky value, something like that.
- 35:58SPEAKER_01: That's right.
- 35:59SPEAKER_01: There are so many states where the AG is very obviously looking the other way.
- 36:03SPEAKER_01: And you know, with all due respect to the city of New York, is there actually going to be anything that comes from this lawsuit against cargoers?
- 36:09SPEAKER_01: I'd be surprised.
- 36:10SPEAKER_01: Yeah, I'd be very surprised.
- 36:11SPEAKER_01: And so I think uh as consumers or as proponents of a transparent industry, our desire or aspiration for regulators to be the force of change, I think that's misguided.
- 36:22SPEAKER_01: I think it comes back to being capitalists.
- 36:24SPEAKER_01: And the businesses that win in a capitalist society are the ones that provide better goods and services.
- 36:29SPEAKER_01: And we're selling a commodity, okay?
- 36:31SPEAKER_01: Obviously, Carfax did a lot of work way back when, whether you like them or not, or auto check and whatnot with vehicle history reports.
- 36:37SPEAKER_01: We've moved past an era of pricing transparency with some of the prior marketing and listings companies.
- 36:42SPEAKER_01: We're in the AI era now, and I think what we've been able to expose at Car Edge, our shopping agent has shopped dealers 160,000 times since July of 2025.
- 36:50SPEAKER_01: I had no clue when I started this seven years ago I was going to be talking about AI.
- 36:54SPEAKER_01: I'm not the guy who's gonna say, you know, in 2019 I was using AI.
- 36:57SPEAKER_01: No, I wasn't.
- 36:58SPEAKER_01: I had no clue what it was, and neither do most people.
- 37:00SPEAKER_01: But we're in a moment where it can bring such levels of transparency that then also represent an opportunity for industry to look in the mirror and say, are we operating most efficiently?
- 37:09SPEAKER_01: Is spending, you know, X thousands of dollars a month on all the third-party marketplace websites yielding for us?
- 37:14SPEAKER_01: Is spending all that money on high turnover roles within the dealership, the BDC, the sales professional roles, et cetera, is that actually the most efficient model?
- 37:22SPEAKER_01: And you know, I do think it's gonna be a long game here to lead with transparency, but again, how do we make it so it's commercially viable and successful to be that dealership and dealer group?
- 37:31SPEAKER_01: And it's so humbling for me, you know, Jim and Bridget, that we see this behavior change day in and day out at Car Edge.
- 37:37SPEAKER_01: We built a certification program where you can't buy the A-grade, but you can buy a brand license to let the world know that you're an A-graded dealer.
- 37:43SPEAKER_01: So we've tried to approach this commercially in a way that you know sustains our values, but also gives dealers an opportunity to have that validation.
- 37:51SPEAKER_01: And um, the success stories are my favorites the one where we called out a dealer, then we fly to their dealership a month later after they changed how they practice, and we can come full circle.
- 37:58SPEAKER_01: That's the intent, is how do we actually drive change here?
- 38:01SPEAKER_03: Very, very good.
- 38:02SPEAKER_03: Does every dealer out there have a grade in your plan or in your program?
- 38:07SPEAKER_01: We've got 24,000 dealerships that have been graded.
- 38:10SPEAKER_01: This is a bit of a maybe a misnomer about our company at Car Edge.
- 38:13SPEAKER_01: We don't just send a bot out to all 60,000 dealers nationwide.
- 38:16SPEAKER_01: Customers pay CarEdge$50 and they use our AI shopping agent to stay anonymous and have that agent represent them and get information on their behalf.
- 38:25SPEAKER_01: And so the dealers that we shop are the dealers that the consumer sends their agent to.
- 38:29SPEAKER_01: It's the dealers that we've we've been able to reach because the customer on the other side actually wants to buy a car.
- 38:35SPEAKER_01: This is a mind-boggling stat as well.
- 38:37SPEAKER_01: The sales conversion rate of our customers who use AI is three times that of our customers who don't use AI.
- 38:45SPEAKER_01: And we already have some pretty high sales conversion rates because car hedge customers are pretty educated and low funnel.
- 38:51SPEAKER_01: And so for industry, it's a it's a wake-up call.
- 38:54SPEAKER_01: Not every dealer has a grade.
- 38:55SPEAKER_01: If you don't have a grade, you can request a mystery shop from us.
- 38:57SPEAKER_01: But the 24,000 dealers we have graded is because 160,000 people have asked them for pricing.
- 39:02SPEAKER_01: And sadly, some dealers refuse to give pricing out online, which obviously is another thing that we bring light to uh through the dealer transparency index as well.
- 39:10SPEAKER_00: So, Zach, of these transactions that you're doing, what would you say the percentages that are actually getting it right?
- 39:16SPEAKER_00: Because at the end of the day, it really is just doing the right thing.
- 39:19SPEAKER_00: So I know we're painting with a broad brush.
- 39:20SPEAKER_00: So what is what does that look like?
- 39:22SPEAKER_01: 60% of dealers in the index have an A-grade.
- 39:25SPEAKER_01: Great.
- 39:26SPEAKER_01: Okay.
- 39:26SPEAKER_01: Great.
- 39:26SPEAKER_01: That's good news.
- 39:27SPEAKER_01: Yes, it's incredible.
- 39:28SPEAKER_01: Progress.
- 39:29SPEAKER_01: Fantastic.
- 39:29SPEAKER_01: It's the long tail where there are opportunities to improve.
- 39:33SPEAKER_01: And I will communicate on the your program, and if anyone calls me directly or our team, the intent here is to help you understand how we grade.
- 39:40SPEAKER_01: We have a very public grading methodology page.
- 39:42SPEAKER_01: If you do not list out your doc fee, uh, but you actually turn out to be a dealer that has gotten rid of doc fees.
- 39:48SPEAKER_01: Well, right now we might be harming you because we look for fee itemization as a data quality indicator because that seems reasonable to us.
- 39:54SPEAKER_01: That's what we've done for a while now.
- 39:56SPEAKER_01: But there are some dealers, Mullin X, for example, or or others, they have no doc fee.
- 40:02SPEAKER_01: Great, tell us, inform us.
- 40:03SPEAKER_01: We have a little report button on every dealer page.
- 40:05SPEAKER_01: We update it.
- 40:06SPEAKER_01: You know, so we're very transparent in our methodology, and 60% of dealers already in the current methodology, and we haven't talked to all 24,000 of them, have an A grade.
- 40:14SPEAKER_01: And so that to me is really inspiring.
- 40:16SPEAKER_01: Obviously, there's a lot of work to do with the long tail of dealers there, you know, the 10% or so that have an F.
- 40:21SPEAKER_01: Okay, like maybe this has been working for you historically, but ChatGPT is now quoting that F grade.
- 40:26SPEAKER_01: That's probably not what you want, you know.
- 40:27SPEAKER_01: So let's get to work to improve that.
- 40:28SPEAKER_01: That's right.
- 40:29SPEAKER_03: Yeah, that's right.
- 40:29SPEAKER_03: You know, as you know, there um Tommy, uh, don't know his, I forget his last name, but uh, we've had him on the show as well.
- 40:34SPEAKER_03: McCullough.
- 40:35SPEAKER_03: McCullough, is that his is that his name?
- 40:37SPEAKER_03: Um, and and we you know, we all see those videos if you're in the industry, if you're a consumer, you see the videos.
- 40:42SPEAKER_03: And there's still, you know, he calls around and he says, Hey, I'm looking at a vehicle on your website, and here's the price.
- 40:47SPEAKER_03: And of course, he gets the runaround more times than not on the on the particular car that he's looking for.
- 40:53SPEAKER_03: He's usually looking for uh cars in high demand, you know, and those are the ones that they say, well, uh, you know, it is on there, but yet we've added some things to it, and you're not gonna be able to buy it for that.
- 41:04SPEAKER_03: And and he'll, you know, come back and say, Well, that's not that's not uh on your website, you know, so that's not that's not FTC compliant, and you can't do that and what have you.
- 41:12SPEAKER_03: So I think all of this, all of you in, you know, outside the dealer uh family, I sh I guess you could say, or the the landscape, that are these third parties like your company that have that have really brought this to light, not just with dealers, but also with consumers, to say, hey, this is this is something that you've got to be aware of.
- 41:32SPEAKER_03: And and of course, I'm probably gonna hear from dealer friends of mine that say, well, you know, what are you doing?
- 41:36SPEAKER_03: You know, you're you're really you're supporting these guys, but we're only supporting you if the dealers are not adhering to what the FTC's laying down.
- 41:45SPEAKER_03: In other words, if there's not a problem, then there's not a problem to report on, right?
- 41:49SPEAKER_01: I I completely agree.
- 41:51SPEAKER_01: And you know, I find that content to be incredibly, you know, amusing, just like everyone else, and and uh and entertaining, right?
- 41:57SPEAKER_01: It's the it's the core kind of friction of car buying.
- 42:00SPEAKER_01: Again, 60% of the dealers we've interacted with, there is no friction.
- 42:04SPEAKER_01: It's easy, it's simple.
- 42:05SPEAKER_01: And so I think a lot of what I've observed in my experience in the auto industry is that that adage of a few bad apples can ruin the bunch actually is true.
- 42:14SPEAKER_01: Yeah, I mean, that is a hundred percent true.
- 42:16SPEAKER_01: And so there has not been a level playing field for really thoughtful and good operators to win on.
- 42:24SPEAKER_01: And again, the examples I have, countless examples.
- 42:26SPEAKER_01: I mean, some of the videos you're putting up on the screen shocker, y'all.
- 42:29SPEAKER_01: I get phone calls on the other side of them saying, like, all right, what do we got to do?
- 42:32SPEAKER_01: What's going on?
- 42:33SPEAKER_01: And you know, what's the path?
- 42:34SPEAKER_01: And so many of these people that I talk to communicate to me their desire to operate differently, but it's not profitable too because their competition, a handful of people on their competitive competitive set, are not doing it.
- 42:45SPEAKER_01: And so I think the thing that we've done that feels very noble and novel is that we've done something that's scalable.
- 42:51SPEAKER_01: If you chat GPT right now, best Toyota dealer in Austin, best Chevy dealer in Detroit, I encourage you folks, do it.
- 42:58SPEAKER_01: It cites car edge dealer transparency index, okay?
- 43:02SPEAKER_01: This has legs, this has efficacy, and it can be and is the first the very early innings of trying to drive that commercial incentive to win through transparency.
- 43:11SPEAKER_01: And that's my goal.
- 43:11SPEAKER_01: That's been my goal.
- 43:12SPEAKER_01: And if you research me and my family, you know, why we've never owned dealerships.
- 43:16SPEAKER_01: My dad worked in them for 43 years, and 1983 Press of Atlantic City.
- 43:20SPEAKER_01: My dad's on the cover talking about how it takes two to have a trustworthy transaction in auto.
- 43:24SPEAKER_01: Like this is in our blood, and that's the aspiration.
- 43:26SPEAKER_03: Yeah, yeah.
- 43:27SPEAKER_03: Your dad's a great guy, and uh I love talking to him when he was on, and uh he and I got into the business around the same time.
- 43:33SPEAKER_03: And it was the Wild West back then.
- 43:35SPEAKER_03: You know, it was we played all these games that you know the dealers, it's funny.
- 43:39SPEAKER_03: There's friends of mine that have dealerships that say, Well, you know, we we don't do that, we don't do that.
- 43:44SPEAKER_03: No, but you used to do that for many years until you know the internet hit, and uh it that that too kind of leveled the playing field with pricing and dealers and and people can shop a little bit easier and what have you.
- 43:57SPEAKER_03: But uh but this is a real thing, it's not going away anytime soon.
- 44:00SPEAKER_03: Wanted to have you on to get your take on uh what's going on with car gurus and what have you.
- 44:05SPEAKER_03: And I agree with you.
- 44:06SPEAKER_03: I don't know that much will come of it.
- 44:08SPEAKER_03: But do you agree with us that that those third-party lead providers and those uh search sites do pretty much sit at the crossroads of what's happening in on the internet with car shoppers and that they've got to put some teeth in their in their policies?
- 44:25SPEAKER_01: Oh, I mean uh Andy Wright, who I think you've had on this program many times.
- 44:29SPEAKER_01: Uh very passionate about it.
- 44:31SPEAKER_01: Yeah.
- 44:31SPEAKER_01: Yeah, I mean his go read his LinkedIn's and ex posts over many years now.
- 44:35SPEAKER_01: He he's at the nail on the head in perpetuity.
- 44:37SPEAKER_01: I remember Alex Vetter one time, who's no longer the CEO over at Cars Responding on X, and it's just like, okay, but do something about it.
- 44:44SPEAKER_01: And you know, I'm the young entrepreneur who has a lot of uh chutzpah, I guess.
- 44:49SPEAKER_01: And you know, the joy I had at NADA my first time going and you know, talking to Alex or talking to other CEOs in the industry, it's like, hey, I think your model's broken.
- 44:58SPEAKER_01: And it's like, all right, kid, you know, stay in your lane.
- 45:01SPEAKER_01: So I think the model's broken, and I think dealers, I have very few dealers I talk to that you know come to me and they're like, yeah, I'm thrilled that my auto trader bill went up this year.
- 45:08SPEAKER_01: Like very few.
- 45:09SPEAKER_01: And one of the really fun things for me is this disintermediation of the third-party marketplaces as consumers use more agentic shopping tools like cars as an example, but also, you know, uh obviously ChatGPT and whatnot, but also then Muse or Grokbot.
- 45:22SPEAKER_01: Consumers are turning to these AI tools to help them shop in shocker.
- 45:26SPEAKER_01: Yes.
- 45:26SPEAKER_01: Those tools are not going to Carfax or Cars.com or Car Gurus, they're going directly to the dealership.
- 45:32SPEAKER_01: And a lot of the work that we're doing is to enable dealers to be ready for that agentich commerce to support it.
- 45:37SPEAKER_01: And so to me, I see a I see a huge savings opportunity for dealers on the horizon here.
- 45:42SPEAKER_01: It's gonna take some time.
- 45:43SPEAKER_01: And for those incumbent third-party marketplaces, I think, you know, humbly with all due respect, they'll be bummed they never made an offer to buy car edge.
- 45:50SPEAKER_01: Not that we're selling, but you know, they're they're I think they're gonna go like dinosaurs.
- 45:54SPEAKER_01: I think uh, radio folks.
- 45:58SPEAKER_03: That's right.
- 45:58SPEAKER_03: Hey, before I let you go, if you could uh ask every dealer principal to audit one thing in their pricing process this week, what would it be?
- 46:06SPEAKER_01: Do you give pricing uh inline online or or in writing?
- 46:10SPEAKER_01: Um and if you don't, really look in the mirror and wonder if you're if you're losing to to your peers.
- 46:16SPEAKER_01: Okay.
- 46:16SPEAKER_01: Okay.
- 46:16SPEAKER_01: Yeah.
- 46:17SPEAKER_00: We also had a comment from one of our viewers, if you don't mind.
- 46:20SPEAKER_00: Yeah.
- 46:20SPEAKER_03: Yeah, what's that look like?
- 46:22SPEAKER_00: That is from Rich Mix77.
- 46:25SPEAKER_03: Okay.
- 46:25SPEAKER_03: And it's uh how much of this is the dealer's fault versus web providers?
- 46:30SPEAKER_01: So my answer may shock people, especially uh because most of my videos are calling out dealers.
- 46:35SPEAKER_01: I think a lot of this is the third-party marketplaces.
- 46:38SPEAKER_01: The intent and the purpose of a third-party marketplace across any category, not just auto, is to make commerce more efficient.
- 46:43SPEAKER_01: The most successful business model we've seen over the past few decades, taking cargoers to a three billion dollar valuation, true car at its height, one and a half billion dollar company.
- 46:51SPEAKER_04: Yeah.
- 46:52SPEAKER_01: What was the business model?
- 46:53SPEAKER_01: It was a lead sales.
- 46:54SPEAKER_01: Yeah.
- 46:55SPEAKER_01: You know, I'm going to disintermediate the customer from the dealer, add friction, but I I solved the friction.
- 46:59SPEAKER_01: So yeah, no, I blame a significant amount of this on the third-party marketplaces, and then those few bad apples that ruin it for the bunch.
- 47:06SPEAKER_01: Yeah, I agree.
- 47:07SPEAKER_01: I agree.
- 47:08SPEAKER_01: For sure.
- 47:09SPEAKER_00: All right, Zach, thank you so much for joining us, president and CEO of CarEd, Zach Shevska.
- 47:15SPEAKER_00: Thank you so much.
- 47:15SPEAKER_00: We really appreciate it.
- 47:16SPEAKER_03: Please say hello to your dad for us.
- 47:17SPEAKER_03: Yeah.
- 47:17SPEAKER_03: Thank you both so much.
- 47:18SPEAKER_03: All right, take care.
- 47:20SPEAKER_00: Yep.
- 47:21SPEAKER_03: Wow, amazing.
- 47:22SPEAKER_03: I know.
- 47:22SPEAKER_03: And and you know, he's he's a young entrepreneur that said, wait a minute, there's an opportunity here.
- 47:26SPEAKER_03: Yeah.
- 47:26SPEAKER_03: I mean, we can clean this up, but at the same time, maybe make a buck or two.
- 47:29SPEAKER_03: I know.
- 47:29SPEAKER_00: I was happy to hear though that 60% of the transactions or the calls that are that they make are good, right?
- 47:37SPEAKER_00: That's actually more than I thought it was going to be.
- 47:39SPEAKER_00: Me too.
- 47:39SPEAKER_03: Um I was surprised at that number too.
- 47:41SPEAKER_00: I'm sure it's more than it was a year ago.
- 47:44SPEAKER_00: Yeah.
- 47:44SPEAKER_00: Um, so that's great.
- 47:45SPEAKER_00: The progress is is good, and we will take it.
- 47:48SPEAKER_03: I know.
- 47:48SPEAKER_00: And you know, speaking of that topic, I would like to thank our topic?
- 47:52SPEAKER_00: The FTC and watching pricing.
- 47:55SPEAKER_00: It's a perfect segue into our sponsor of the day.
- 47:59SPEAKER_00: That's right.
- 48:00SPEAKER_00: This is a great solution.
- 48:00SPEAKER_00: Radar by Auto AI uses artificial intelligence to monitor your dealership's vehicle listings and digital ads, identifying potential compliance issues before they become costly problems.
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- 48:21SPEAKER_00: All of that can be done through radar.autoai.incree compliance scan from them.
- 48:28SPEAKER_03: So that's right.
- 48:30SPEAKER_00: Anything we can do to help the situation.
- 48:32SPEAKER_03: Well, you got two remedies right there.
- 48:34SPEAKER_03: Right.
- 48:34SPEAKER_03: Actually, from what I'm understanding, you could actually do both.
- 48:37SPEAKER_03: You could you could actually these are these are not expensive uh uh uh uh programs here, and and but they work and they're a heck of a lot cheaper than millions of dollars in fines.
- 48:53SPEAKER_00: We gotta we've gotta get it right.
- 48:55SPEAKER_00: That's right.
- 48:55SPEAKER_03: Used car week is coming up.
- 48:57SPEAKER_00: It is coming up.
- 48:58SPEAKER_00: Wow.
- 49:00SPEAKER_03: Yeah, I just thought about that.
- 49:01SPEAKER_03: Used Car Week's coming up and we're gonna be there and you need to be there too.
- 49:05SPEAKER_00: November 16th through the 19th in San Diego.
- 49:08SPEAKER_00: We will be there.
- 49:09SPEAKER_00: We'll bring you the live show directly from the show floor, which will be um out in San Diego, like I said.
- 49:14SPEAKER_00: So still noon Eastern, but we'll be filming at nine o'clock.
- 49:18SPEAKER_00: You know what San Diego stands for?
- 49:22SPEAKER_00: Oh, if you if you know, you know.
- 49:24SPEAKER_03: You know, you know.
- 49:26SPEAKER_00: So anyway, yes, we're looking forward to seeing everybody out there doing some interviews and bringing all the great coverage that we catch out there to you.
- 49:33SPEAKER_03: Sure.
- 49:34SPEAKER_03: If you're it's gonna be a used car year in 2027, folks, for sure.
- 49:39SPEAKER_03: Another strong used car year.
- 49:40SPEAKER_03: And uh, and I'm telling you, I've been to this week, you gotta go.
- 49:44SPEAKER_03: Whether you're buying them, selling them, transporting them, financing them, marketing them, everything is under one roof right there at Used Car Week.
- 49:53SPEAKER_03: So and by the way, stay come by and say hello to Bridget and I.
- 49:57SPEAKER_03: We're gonna be uh shooting the live show from there and also doing a uh ton of interviews.
- 50:02SPEAKER_03: So come on by if you want to be interviewed, then then let us know.
- 50:07SPEAKER_00: We'll be know what head over to cbtnews.com to get more great conversations like you saw here today and the coverage that we get from Used Car Week.
- 50:15SPEAKER_00: And while you're there, be sure to sign up for our newsletter to get more stories, more content to help you run your dealerships better.
- 50:22SPEAKER_00: So um we are here for you.
- 50:23SPEAKER_00: Um so please sign up for the newsletter and also all the social media channels.
- 50:27SPEAKER_00: There's so much follow.
- 50:29SPEAKER_00: It's all free, which is cool.
- 50:30SPEAKER_00: This is all free.
- 50:31SPEAKER_00: We are supported by our wonderful advertising community, like people like Radar?
- 50:38SPEAKER_00: Radar.
- 50:40SPEAKER_00: So many others.
- 50:41SPEAKER_03: So many others.
- 50:41SPEAKER_03: So thank you.
- 50:42SPEAKER_03: It's been a great show.
- 50:43SPEAKER_03: Too many to mention in this segment.
- 50:46SPEAKER_03: But thanks for watching.
- 50:47SPEAKER_03: We'll see you right back here tomorrow at noon Eastern for another edition of CBT Live.
- 50:51SPEAKER_03: Go out and make it a great day.
- 50:53SPEAKER_03: Five days left.
- 50:54SPEAKER_03: These are the five days that matter.
- 50:56SPEAKER_03: And don't be sandbagging.
- 50:57SPEAKER_03: See you tomorrow.
- 51:03SPEAKER_04: Close it up, and then we're going to be able to