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Carvana, OEM Pressure & the Fight for the Future of the Dealership · Automotive Informants

• IgniteUps.ai: All right, welcome back. we this is automotive informants ⁓ we've got a special guest today. Zach is out. He's got family emergency had to get to. wish him bless ⁓ you know, prayers ⁓ going out his way. But Matt ⁓ Uber, I you know, glad you're on. We've we've met quite a while ago, I think sometime l last year, I wanna say, when I still was living in my my house before it got burned down, but well y it did. It was a is unfortunate electrical issue that happened at my home, but it is what it it is what it is. But I'm ⁓ the family's good, family safe. But Matt, you know, we we discuss headlines, the different things that are happening in our industry in automotive. And I really, know, you're you're a superstar in this space. Matt Uber - CallGradeIQ: Really I didn't know your house got burned down. IgniteUps.ai: I I I really believe that that your talent and what you bring and w in your company and what you do. think my audience would would like to hear more about it, but if you could give me a quick couple minutes of your intro and and who you are and so my audience knows who you are. Matt Uber - CallGradeIQ: Yeah, I appreciate that man. yeah, ⁓ fifteen years in the automotive industry, most that has been on the vendor side. a lot of the companies that you know of and the website and advertising side have played a part in ⁓ building and them from a position of head of sales, vice president of sales, most of it has been on the sales ⁓ I have a belief that I've used inside of the automotive vendor side. and the way I build and run teams is a hire from within. ⁓ Organically and use that. I call that my farm system. About three years ago, I walked away from the corporate landscape to create my own coaching and consulting business, and that's given me an opportunity to work with dozens of companies both in and outside of the automotive industry to be able to place that framework inside of their business. And last year I had a unique opportunity to start this process inside of a dealership, and I partnered with a ⁓ with a large automotive group in the state of California to build. outsourced BDC for them, a more of a centralized BDC for them, ⁓ was able to install this same process in there. So that's what we're working on in the business. Through that I've also created and installed the over 15 years of sales leadership experience into a platform ⁓ called Call that allows us to be able to ⁓ monitor, track, engage coaching opportunities ⁓ inside of store that with every single customer engagement that is happening in the store. So my main focus, Chris, coaching, developing people in and outside of the dealership primarily in automotive. IgniteUps.ai: That's awesome. You know, I I think you know, I'm I'm I'm big on on on coaching, developing and training people. And I I love what you're doing, man. It's ⁓ it's it's ⁓ it's always good to see someone like yourself doing plain, you know, helping dealers more importantly, but the people in the business helping them grow grow them. That's that's that's the what I feel is the most important. you know, we have ⁓ quite a few headlines to discuss. they're kind of all over the place. There but, you know, they all kind of, you know, could tie into each other. gonna kind of go through, you know, and just give the audience a a quick rundown. We got a couple of headlines, one ⁓ Bloomberg calling one of ⁓ these used car retailers a poster child. We'll get into that one. the next one we'll probably talk about is ⁓ a a manager put in prison for the next six years. ⁓ ⁓ just because he did some stuff that we can discuss. next thing we'll talk about is repossessions. this was an article from automotive news. love to get into that one. And then this this report came out yes just yesterday on that same used car retailer. this investigative reporting that was done by a car dealership guy. So ⁓ let's let's get right into it, Matt. You know, I I think we can we can start it in any direction, but do we can get right into the the meat of it or we can we can start with may a a softer ⁓ one Okay the these two things and this is like it probably could take up the whole conversation today, but Carvana Matt Uber - CallGradeIQ: Dive in. Let's dive in. We don't need to soften in there. Let's jump right into the deep brother. IgniteUps.ai: Bloomberg, I just posted about this yesterday because I read this article where Bloomberg called them the poster child. And I thought, Here we go. Cause cause they're the the haters come out the minute you say that word, right? It's like you almost don't even want to say that. They make you want like not want to say it, 'cause then you just you you hear all the comments and you're like, ⁓ my, here we go. Like they're crooks, they're criminals, we've heard it all. But Bloomberg's calling them the poster child. What are your thoughts? Matt Uber - CallGradeIQ: ⁓ look, I mean think they're a huge name. I think that they draw attention. I think all of those things help in that process. If they put the name of a very successful car operation that nobody heard, it wouldn't get the attention that ⁓ Carvana up there does. But look, the reality of it is, in my opinion, is Carvana a proven model. That at one point could have soared or could have failed, they've sustained and they've consistently grown. And I one of biggest things I get confused by in this space is why so dealers ⁓ demonize them and try to learn from them. So often I see narrative around Carvana is picking apart what they don't do perfectly ⁓ instead of figuring out they've gotten the market share that they've gotten to be identified. By anybody a poster child. that just the way I look at it. I tend to look at how I use the data in front of me to for me to get better, not make an excuse why I'm not good because somebody else is doing something I'm not able to do or not willing to do. That's just my two cents on it, Chris. What are your thoughts? IgniteUps.ai: Well, I think ⁓ I think you're right. I think it it's too easy it to ⁓ just say, ⁓ that's you know, I know what they're doing and this is what it is. It's just like someone that works out and exercises, right? Has a six pack or is in better shape than someone who's overweight, right? Like they'll make up every excuse why they can't eat right and they can't exercise, right? Then they're gonna say, well, you know, I just don't have time or I just you know, they make every excuse in the world and in the and and dealers are no different. You know, there's there's those like I always tell ⁓ some of the the the people that that I've I've I've I've worked with and I go, look, just like we see five car Freds on the sales floor, there is those types of people that are dealer operators too. Like there's those operators that are just coasting. They they it if they didn't have that nameplate that opportunity, they they wouldn't be in that that there's no way they if they had to really try and grow their business without the nameplate, they'd be in trouble. a lot of them I think take for granted that that franchise that they are running, the the brand really is what makes that that company and the they have this false that they are amazing because the is really what's carrying them. ⁓ You what I'm saying? And but there's a lot of really great operators. There's a lot of people ones that I've seen and worked with my last twenty three years in automotive and it it's amazing that they just don't want to look and learn. And then the best operators I know, the ones that are doing big numbers are always trying to see, okay, how can we, you know, what could we take from this? What good what's a best practice that we can apply in business model? Still have our same, you know, Chick-fil-A standard, where, you know, you're still talking to people and trying to, you know, do that face to face. But How can we, you know, maybe some of the friction and and help improve our systems and processes so that we can grow our business and ⁓ continue, you know, prospering? Matt Uber - CallGradeIQ: Yeah, ⁓ look, man, I I've trained hundreds of salespeople over the years, and one of the philosophies I have in training salespeople, and this is both in the store and outside the store, which is your success or lack thereof ties back to your pitch, pace, and your attitude. And why I focus on those three things, Chris, is because ⁓ three of those things are things that are within my control. Everything is outside noise, everything else is a distraction, everything else is an excuse. ⁓ And if you didn't make the sale that you wanted or have the month that you wanted, you always look back at how can I affect change within myself. see a lot of dealers over last 15 years who are very comfortable being status quo. I would tell you the one of the biggest challenges I have in talking to dealers is how do I get them to make change? Because one of the biggest differences or one of the biggest obstacles for me as a vendor selling to a store is not can I sell or show them the value in what we do, it's just the obstacle of change. I would say that's a lot of dealerships just have that challenge of change. So ⁓ in the process of writing a book right now, talking my system around how I develop people, and one of the stories ⁓ that kind came back to my memory in the writing of the book was. In one of my first sales jobs I ever did, I used to sell direct TV inside of Sam's Clubs and Best Buy. We'd stand at the front of the door, it was a hundred percent commission job, a thousand rejections a day, and we'd look for one or two people that would give us a yes. And every morning we come to the office and we practice our pitch. At the end of every day, we'd come to the office and we'd recap at the end of every day. And once a week, they would put out a report that says, Here are the top 20 people in the country who have been the top performers. And in that, they would share of what they did. They would tell Tell us how they did it, and then they would give their phone numbers. of the things that I did every single week is I would call every single person on that list and ask them for help. Ask them how they are doing it, what are they doing, and I would learn how to get better every single day. I see enough dealers looking at the market and saying, where the gap is in my process, and let me figure out how to solve it. ⁓ In most the solution is right inside of the four walls of your dealership, in on your people. What do think? IgniteUps.ai: Hundred percent. I think know, ⁓ I always bring this this this argument up where, you know, you do you wanna be McDonald's or do you wanna be Chick-fil-A? And McDonald's they put all kinds of robots and screens and they're trying to remove the the employee as as often as possible. And you look at Chick-fil-A and the people, I mean, they're in the drive thru, they're they're very much a part of the process and part of the equation, right? And one, you know, delivers an experience, the others, you you know fast and convenient. and I I really think that if you leaned in on just the experience and, you know, building your people, I think you can outperform a of dealers. I mean, I'll tell you most you know, I've I've I've had I've been fortunate enough to to you know to different stores across the country in the last three years and I I've been, you know, you know, God w ⁓ you know, I've been You know, I've been blessed to work with a lot of people over the years. ⁓ I'll tell you, our the that I've I've been a part of, we just executed and and played a high level that we've grown our business substantially. I mean, the reason one of the reasons why I looked at what Carvana was doing because one we helped take a store from 150 cars to a thousand cars a month. Matt Uber - CallGradeIQ: Course. IgniteUps.ai: I mean, that took us four years to do it. It took them eighteen months to do that. cl I mean, they didn't hit the thousand yet, but nine ninety eight, I mean, ⁓ a thousand cars, right? I mean, just ⁓ it's a rounding error. And and they probably, you know, wholesale, you know, a ton of cars out of that that that deal. But, you know, ties into the article that the car dealership guy published yesterday. And what he did was he he did some investigating because there's a lot of a lot of dealers that are like, ⁓ my god, that's not fair, 'cause I don't think it is. I think they're they're they're playing at a completely different game, a national game. Every dealer's kind of, you know, stuck to having to advertise in their primary market where they're just playing at a different level and Stellantis, it appears like they're just kind of like allowing I mean, they don't have to have a website provider, they don't are the approved vendors for chat or know, d you know, the different websites that they have, because they have their own website, own chat, things like that. And you look at their the investigative reporting, they they interviewed 40 dealers, general managers, brokers, attorneys, and most them were anonymous because they didn't want to get pushback. But think about one of the things that was kind of like eye-opening for me. Is in a market there's like in in was the market that they described. In the whole Pennsylvania market, 693 new CDJR were sold. And there's 99 dealerships. So think about that. In Pennsylvania, ⁓ there's 99 dealers D Jr dealerships, and collectively they all sold 693 cars. The largest local dealer in that market sold 40. 2,000 miles away is the Arizona store. And sold 24 cars in that market. So when you think about their reach where they're actually selling a lot of these cars, it kind of eye opening. I it it's interesting to see that, you know, they're not just, you know, they're they're playing a completely different game. And ⁓ it I don't I I do think there's, you know, from an allocation standpoint, where'd they get the inventory? 'Cause we had to like beg for inventory when we were doing it, buy inventory from other underperforming stores. I mean it was it was a process to grow that inventory. we never sold a thousand new cars because those were just new cars. We it like five, six hundred new and four or five hundred ⁓ used month. So it wasn't like you know, that was at a Toyota store, this CD Jr store. Like that that's that's interesting that they can they can have that kind of reach. Matt Uber - CallGradeIQ: Look, at the end of the day, what I heard you say is they're not restricted to some of the things that the other dealerships are restricted to, and I and I get that. and that's the question of whether you're whether you're yourself to play the game that the manufacturer is requiring you to play or not. Now, look, keep in mind, Chris, no CDJR has to use an approved web website provider. ⁓ They just out on some of the co-op money, and the co-op money is what they're ⁓ they're focusing right? That I mean, as a guy who's ⁓ been at been at dealer socket, been at team velocity, been at a lot of these. OEM programs that as they enter into the program, the primary advantage is yes, you get to use the co-op funds and then you just fall in line with what the manufacturer says. But there are plenty of dealers who do not use the approved providers, and reality is their approved providers are going to put a little bit of a governor in regards to what you can do. They they not incentivized to get the best outcome for you, they're incentivized for compliance. Those ⁓ primary website and advertising companies, of the thing that allows them to separate themselves from the marketplace to get into the space gets removed as soon as they get into the OEM programs. Competitive pricing, innovation. I mean, look from a dealer inspired perspective, and I don't mean no harm on these OEM and website providers, but ⁓ Dealer Inspire innovating as soon as they got acquired by Cars.com. Dealer.com stopped innovating as soon as they got acquired by Cox. ⁓ DealerOn hasn't been acquired, and they've grown more than anybody. Over the past five years, been more in an acquisition mode. The problem is these OEM programs don't you to be gritty to compete with things like a Carvana. And the reality is at the end of the day, Carvana, ⁓ number thing they have over almost every other business that I is they've got almost an unlimited budget to come in and out compete on visibility in a place where they have to cover the gap. ⁓ Because there's different levers we're pulling, right? From an advertising perspective, you're you're pulling. An organic presence and you're pulling a paid presence. And until your organic presence is there the market that you should already own because you've been in that market for a long time, then you have to play in the paid side. ⁓ my experience, too many dealers have focused far too much on the paid side without the emphasis of the organic side. So they have to always keep going back to the paid side to have presence and to get leads. To where if 10 years ago you would have invested in the organic side, you would have an organic presence in your community that would require require you to spend a lot less on advertising to go against company like Carvana who has a generally an unlimited budget to outperform you in that space. ⁓ IgniteUps.ai: No, I don't disagree. Well, but ⁓ let me just answer c a couple of things. Like one, so I'm I'm I'm a v on the vendor side now. I do I there are some conversion tools that I have on on websites and primarily my Stellantis stores, sometimes we get ⁓ approved and sometimes they say no, you're not approved vendor and we have to fight and go through that whole thing. So, you know, it it you still have to like, you know. get them to to a point where th they will approve you or else they'll just keep, you know, figuring out a way to just take you off of their dealer's website until you go and through their process and do all of that. but then it takes a year to get that that thing, you know, certified them. So, and and then Matt Uber - CallGradeIQ: There's so many dealers that I've talked to that have a OEM certified website by the manufacturer in the game that they're playing, but they don't drive any of their c any of their stores and their ad dollars to that process. And all they have to do to do that is to just give up the free money that's coming through the co-op side. And they maybe drive towards a group site or drive towards a self-branded site and they have to just spend their own money towards that and they're not restricted to any limitations on the tools that they're using. IgniteUps.ai: Well, ⁓ you know, I I I I can't speak for all OEMs. I can just tell you my experience so far with some of the Stellantis dealers that I have today. but I can tell you that, you know, what they do have their hands tied in in certain regards where they're not allowed to use every tool that I I I offer. And I can save them thousands a month, ⁓ because some of these tools that some of these vendors I mean and we can that could be a whole different conversation to say the least, 'cause when you think about you know, everybody having to kiss the ring and, you know, you know, get the, you know, pay out, you know, certain different other ⁓ Matt Uber - CallGradeIQ: Mm-hmm. Course. IgniteUps.ai: parts of the process just so that they can get into certain areas. It's it's un un it's unreal. You know, I I didn't really think about that ⁓ into this side of the fence until I was the knee deep in it. And it's it's interesting. but you know I I think about you know where these dealers could be, you their head could be at, especially if they're in Pennsylvania and, you know, the biggest dealer in Pennsylvania selling forty cars. you start wondering, okay, so what made these twenty-four customers that were in that market buy from Carvana instead of instead of them locally? And I think what you're right, I think they they those Carvana's done a great job with with their organic, their SEO creating different content that, you know, really speaks to everybody, but they're also spending a fortune in advertising. I'll tell you, they outspent CarMax by a hundred million dollars last year. So you gotta think they're spending three hundred million a year in advertising. you know, they're the s some of these dealers just w will never be able to compete with that. But If they, you know, focus on on a strategy in their own market, I I think they can still play at a high level and kind of convert some of those those opportunities. But they've just got to understand Matt Uber - CallGradeIQ: I think the other thing to add to that though, Chris, like you go to every mid major and you look at any like you search for any used car inventory in that, and I challenge you guys to do that. Go into Google ad preview, put in a zip code of a major market, put in any primary c commonly ⁓ sold used car the Google search into the Google ad preview, and will find Carvana in the number one spot ⁓ nine out of ten in any mid or major market in the country. any major vehicle. ⁓ right now and type in 2023 F-150 in Dallas, Texas. Put any zip code in there. And I bet you Carvana is number one spot on the paid ads for that aspect. And not just in Dallas. It's going to be in it, it would be in Amarillo. It would be in all of these mid-markets as well. And so there is that. But More importantly than the dollars they're spending, they're speaking to the audience and meeting the audience where the audience needs to be met. There's a reason why their market share has grown because they're removing the restriction that the consumer believes is still in the dealership buying process. And they make that a more comfortable buying experience, at least on perception. And we can always go into the details of what the reality is and what they're actually gonna get working with a local dealer and a dealer that can then serve. Service them and then execute all of the stuff that needs to be executed behind that process. But most of the consumers scared of the buying process and dealing with the dealer and that, not realizing that they're going to get the best deal possible when they have to deal with the local dealer. ⁓ a dealer who changes that perspective ⁓ their market closes the gap far faster, in my opinion, than trying to outspend Carvana, because it's not going to happen. Changing perspective with how the dealer in the community looks at you. is the number one gap, I believe you can close now. IgniteUps.ai: I don't disagree. I think you I think if you if you focus on on providing that that experience and and it's also, you know, creating that strategy. I'll tell you some of the strategies we did when I was at Charles Mond in Austin, Texas. and and you know, I I always hear people tell me, Hey, well you you you were running you were running a there was a Toyota store and th there's a reason why you guys got to a thousand and I'm just and you were in Austin in a fastest growing market. Yeah. Matt Uber - CallGradeIQ: Everybody wants to give you the excuse why you got jacked. You went to the gym and you ate right. I mean like come on. IgniteUps.ai: You know how hard y they don't understand how hard that was. Like what we actually had to do and grow and find property and as you know, you catch this lightning in the bottle of of a good team and you know, and then actually have to deploy all of the the the resources and everything and the the owners were I mean, they we couldn't have done it. I mean, it was a whole team effort. Like it was you talk about the perfect storm. And that that store had been there for, you know, a hundred years prior to us, or whate however long it was, but y you think about what it takes, I I I do believe that there is some strategies that you can deploy. I've written on several books about the strategies. and if they if they just deploy some of that stuff but do it and work it every day, I think too often dealers and I'm not I'm I'm not saying this is all dealers. ⁓ let's let me preface this. Matt Uber - CallGradeIQ: Most dealers are great. IgniteUps.ai: There are s yeah. Most the most of them are great. Some of ⁓ though, minute th it's like they've gotta just like they like someone told them a long time ago that when something's going good, you need to cut what you're doing so that you can, you know, save some kind of expense. And I and I think about that and I go and I look at those people and I'm thinking like Matt Uber - CallGradeIQ: Mm. IgniteUps.ai: Everything that you just did to get to where you're at and you're growing, you're number one, you're doing things, and now you wanna cut all of the the things that were making and helping you get to those big numbers, now you wanna cut all that, it's it's the craziest thing that I've ever seen. And and it's and it's wild that there there's there's a lot of dealers that that do those things and then, you know, after they cut all of those expenses and then ninety days pass and then they're trying to well, what happened? And And then they're calling you back and hey, can you help me out? And do things like that. And it's it's interesting because I've had to I've had to fight it at a lot of stores that I've helped run where the like, Yeah, we gotta cancel and I'm like, No, no, no, no, we gotta stay the course. It's it's what happens, the discipline, and we'll get there. Matt Uber - CallGradeIQ: What what's so under considered in that is the value of momentum, Chris. You mentioned like when you have a team and putting a team together. And always talk about this, which is you need that one person who sets the bar, and you need the next person who raises the bar. And then time that bar gets raised, now you have a new standard and then you build on that momentum. So when I work with dealerships, ⁓ specifically on farm system, the number one way ⁓ I ⁓ create Which is just changing the culture around what this store has to offer people. And when the people ⁓ something that's being offered to the store, they tend to then ⁓ something more to the customer. And so for me, everybody the stores I work with starts at entry level. They grow We give them a clear pathway to grow. And there's stores I am currently working with right now that says, I've you let me hire multiple BDC reps, give two. I can develop from the BDC. develop them to be a general manager ⁓ the next five years. But there's a lot of work that goes into that. But when people are hired with the purpose of you're going to do every step in the dealership to become a general manager in five years, ⁓ here are all the steps you have to do, and it's very clearly laid out. ⁓ level of ownership and leadership that follows just at the entry level ⁓ drastically. The amount of amazingly operators that operate. run into. And their story is I started as the porter. I started as the this, I was the porter, ⁓ I did this, then I was on the service side, then I got an opportunity to move to the sales side, and then I became a sales manager, and then I was a finance manager, ⁓ now I run this store. ⁓ years later, I was a porter, now I'm running the store. There's so many examples of that ⁓ somebody has a path of growth, and then there's a culture that that when you come, this can your future, and there's a very clear time. timeline on that, man, the impact it changes in the store, then turns to help out everybody outside the store and how you deal with the customers because the level of ownership ⁓ your store and for those customers change when it will eventually be your store in your mind. IgniteUps.ai: Yeah, no, I I I agree a hundred percent. But I I get back to the the same the same thing where you know everybody knows what it takes to be in good shape, but very few people wanna eat the the same things or just you know eat cleaner. no sugar, cut out the sugar. I mean, that's probably the hardest thing that I struggle with personally is just removing the sugar. and then we're exercising, right? And eighty percent of it's Matt Uber - CallGradeIQ: Well IgniteUps.ai: your diet, twenty percent is the exercise, but people people know the game plan, they just don't want to do it. when it's really just it's easy, but the discipline is what's hard. Like the the roadmap knowing and understanding what it is what it takes to get there, you know, it it's and and I've written about it for for years now. And it's because I do believe that people can get there. Just do they want to get there? And th there's too many people don't want to take shortcuts. Like getting back to some of these GMs you know, don't do the right thing always, there's this one general manager going to jail for six years. It was an article that ⁓ was written and this this GM apparently had two hundred and twenty-three transactions that he basically was, you know, signing off and you know, doing things to, you know, enrich himself instead of protecting his partner. And so he's gonna to prison for six years. What do you think about about that deal? Matt Uber - CallGradeIQ: Luke man, I don't know too much of the details. I've never sat in the general manager's seat. I'm sure there's a lot of things that people can do. There's bad apples in every scenario. and you know, I would I would just question ⁓ there not signs of this individual having that character before he got to sit in that seat? Because you don't get become a general manager easily. And often I've been in organizations, Chris, and I'm sure you've been in organizations like this too, ⁓ where reward the top performer but maybe not the best leader, where you perfor reward the person who sells the most cars, but maybe isn't the person who should be s leading the organization team. ⁓ I know anything about that. Individual. I don't know anything about the store, but I'd be interested to see when that guy led the organization, regardless of the fraud that he was doing, was that organization, was that store that he was leading increasing in performance or decreasing? I would bet that it was not increasing in performance, but I don't know. What do you know anything about him? IgniteUps.ai: No, you know, I didn't I didn't I'll all I was kind of interested in is what was doing specifically. Cause I've I've written a book with a a friend of mine and she was actually I worked with her for for many years. ⁓ she was our CFO at a couple of the organizations that I worked at, and we a book ⁓ called The Automotive the The Automotive Controllers Ultimate Playbook. And the reason why wrote or we wrote that book was because ⁓ We wanted to make sure that, you know, 'cause I've seen, you know, fraud, I've seen people do some unscrupulous things in the store, have had a f let go of quite a few people once we caught it, but we caught those kind of things because we had systems in place. And I I think a lot of times people forget that, you know, they just think this is the way it's always done instead of asking more questions and putting and figuring out ways to put the you know, do we have blind spots in our business? And how can we that those those kind we're aware of what's happening? And I I I think that as long as, you know, dealers have these types of systems and processes in place, they they can avoid some of this stuff. And I think what you did say though, I I did ⁓ I do agree with a lot of you know, had this somehow they got to the position that they're in. and so there was probably signs ⁓ Matt Uber - CallGradeIQ: Yeah. IgniteUps.ai: long time ago and some some dealers, you know there's a couple of books that I I or there's a interesting story that I I I learned about. one ⁓ was it was in the in the show called The Men Who Built America. I don't know if you've ever seen that show. It's a great show. I definitely recommend you s watching it. And story about I don't know if it was Car I think it was Carnegie. So Carnegie was a wealthy man ⁓ Did a lot of good things back in the day. but then he also hired a guy that was, ⁓ know, got the job done. He his fixer, right? He would go in, ⁓ fix make sure things were right. but this that worked for him, he knew he was stealing from him. But because his he and what he was doing, he kind of let slide because he said, Look, if I got rid of the guy. ⁓ It would have actually cost me more money than what he was stealing because I'd have to go and try to hire several people to do that. so there are some people I guess that about people that do things like that, and are okay with it. But I cause I'll think about Carlos Gone. You see that story on Netflix? Take a look at it. It's a great story. it's interesting because this This is a guy that somehow turned Nissan around, was ruthless on how he did it. Apparently, I'm not sure. this is just what I've heard from other people. you know, it's the the what he did though was he literally got this Nissan at the at the point was at, you know, on the brink of bankruptcy, and he somehow turned them around. They were like losing money every year, and then they became they were making billions every year with under his leadership. And he was buying a bunch of properties ⁓ but he was putting it in Nissan's the comp the organization's name. But they said that they were that he was enriching himself. that that wasn't really approved, yet he had to get the entire board to sign off on these properties he was buying. But they were also into Nissan's name, so I don't know how he was enriching himself, so I don't know. all the details, but I'm just going by what that Netflix story was. But now look here we are again where Nissan's at the point where they aren't doing as hot as they used to be. now they're talking about some type of merger with Honda and who you what that direction is gonna look like. I think Nissan as a brand is good good brand, but It it's definitely an interesting story. And you think about this guy that was supposedly in enriching himself was making them billions and now they're they got rid of him, tried to put him in jail. He escaped. I don't know if you know that, but he escaped jail. They him in some kind of luggage container and they like got him out of the country or else he they he felt like he was not gonna get a fair trial. And so he had some mercenaries Like take him out of the country and you know box. Matt Uber - CallGradeIQ: Now he's running one of the Chinese manufacturers that I'm just gonna I'm just let me ask you a question on Nissan. because I'm very interested in this. Obviously, I believe the reason why Nissan's struggling in today's landscape is because they had such a heavy share on the car. And with many of these manufacturers moving away the car and moving towards SUVs and trucks as primary models, is is that the primary thing that's causing Nissan? They just never really had a good SUV and truck market, and so now that the car market's just not in demand, that they don't carry the same value on the models they do that where the ultima and the maxima where their primary ones, those aren't necessarily in demand in today's world. So that why they're struggling or do you think it's just something bigger than that? IgniteUps.ai: You know, I don't I you know it's hard to say because they canceled their their big vans that they were selling. They canceled the Titan, right? Like they're no longer selling the Titan anymore. They canceled the Maxima. like I like they've just kind of and and then they were in a a point these last couple of years or this last year that they're just selling off all their factories to try to get money to, you know, grow their business because they just were out of money. and it it and it's interesting because I always thought Nissan had some pretty good models. Like, but then they s I felt like they were trying to be like everybody else. like Rogue is a I think is a nice one. But then they had the Murano. but I don't know. It it's just interesting because I I I do think they have some pretty cool tech. ⁓ and for the value, I thought it was it was a good value for for consumers. I know they had some transmission things on certain models, but of that, I I've I've helped run a s Nissan store and I thought it was great, great brand and I thought it was good, but you know, the i it's it's hard to to you know, I think part of what the the Chinese and the talks of what they're doing is that they're being able to be ⁓ innovative in instead of waiting six years to get a new model out, they can create new model every two to three years. And the because of how their their manufacturing is set up. And so I think part of what what's happened with some of these OEMs is innovation. Think about what what's w where's right? We ⁓ it's basically minivan and and there's no other real models there and and And and it's and it's just happening to a lot of in these OEMs and ⁓ I I don't know, tariffs. I mean you can you can try to pinpoint a bunch of different things, but I don't know. It's it's it's it's interesting to say the least. I think when you look at companies like that are winning today, I think some the technology and their actually have their own unique brand. I think companies like Tesla are are some of the things that I think some of these OEMs should kind of model after, especially with their FSD. But, you know, I I I think that everybody's kinda looked looks the same and has looked the same for quite some time now. Matt Uber - CallGradeIQ: Yeah. Yeah, you don't see too many just new like wild things coming in and and changing it. I mean i so much so, like we recently were looking to buy a car about a year ago ⁓ we ended up going with the BMW X five, but I really like the Audi, the ⁓ Think that's the the eight. come find out that actually shares the exact same body style as the Volkswagen, shares the exact same body style as the as the Lamborghini. It shares the like it's got ⁓ three or four different that exact same vehicle, just different brand on the front, because it's just ⁓ you know German manufacturing that sense. and I found that to be very interesting. And I now I look at the the Volkswagen, I'm like, why would you buy the Audi when you can get the Volkswagen's the exact same car with a different logo on the front in a sense. Obviously different engine, different different technology inside of it slightly, but yeah. Yeah, I I I find all of that very interesting. Not as a guy who's never run a store, never been in a store, just ⁓ considerably a car guy. I've driven the same F one fifty for the past, you almost ten years. I I do find it very interesting. The ⁓ the ups downs of these manufacturers. From, ⁓ you know, I like when I first entered the space, how ⁓ Hyundai was kind of like that like redheaded stepchild that never had really any attention and now they're they're, you know, a I would say a a pretty fast growing brand that seems to really getting a lot of market share. I mean IgniteUps.ai: Well look at what they're doing. I mean, th they've got a lot of uniqueness. Th some of their models, I mean, they're they're kinda setting the tone. I I think one could argue that they set the tone on the square body and everyone else saw man. They brought back the square body and they started creating new that looked more rugged and had a s like the square look where they kinda Matt Uber - CallGradeIQ: Yeah. Yeah. IgniteUps.ai: Most of these SUVs were kind of looking more and more like minivans until they started, you know, creating their their brand that and had a unique look to it, more rugged and they said, you know what? Then everybody just kind of rode that wave and on the OEM level. But then think about this. They're they're now putting type technology in their vehicles, ⁓ in China. But I don't know if when they're gonna bring it over to the United States. But I I really I think people are just sleeping on that and the OEM's really Matt Uber - CallGradeIQ: Yeah. Yeah. IgniteUps.ai: need to kind of wake up because that technology, like if you look at some of the the tech even in BYD, it's it could really put a a reason why they're stealing market share in the UK and Europe and all over the place because their technology not only is it cheaper But it's more advanced ⁓ they have the F S D capabilities that Tesla has. And and once you get like used to that, I don't ever want to drive any other way. ⁓ Matt Uber - CallGradeIQ: Do you I I've never I I don't know your opinion on this, and I don't know if I have a strong opinion yet, but I I assume you have a stronger one than I. Do you think in the Chinese manufacturers is a good or a bad thing for the automotive space in America? Not the manufacturers, but for just the automatic space. ⁓ IgniteUps.ai: Well, when it what l when it comes down to politics, could see why there's argument why they don't want ⁓ here. I can see, you know, ⁓ know, back in the day it was the Japanese that were coming and, you know, just gonna destroy the market and you know, it was it was a lot of it it it came down to a lot of politics and why they're not and I and I hear a lot of dealers and And OEMs and what they're saying, but the free market person in myself says, Man, you know what? Let's it it's only gonna help create innovation and you know, if if if we get our ass kicked, excuse my language, if we get our our our butts kicked, then it's our fault. Like we need to really own up to it and figure out how to be more competitive and and out innovate and do more. ⁓ and and that's that's that's really my thought process. I feel like if I get beat, it's on me and I gotta figure out how to do better. Matt Uber - CallGradeIQ: Yeah. Yeah, and and I mean I think it ties directly back to what we started off with, ⁓ i the carvana thing. Like if they can come in and they can take market share from these other manufacturers, like do the manufacturers deserve to be here? If they can come in and and i I think it creates more opportunity for dealers, assuming they have a dealer base that will be able to sell that as a new manufacturer. I think that if the consumers find now a more affordable car that can give them what they want to do, I mean I think unfortunately the we have have a chokehold on the space right now and the the the ⁓ What a consumer gets for the money is just unreasonable in today's world. And and I think for the general health of the industry, in external manufacturers that can ⁓ technology at a discounted cost creates a a better marketplace for for the consumer. and I mean we always talk about ⁓ why are the the car sales going down and market this and market that. I think this just Creates a additional benefit. I think it creates more used cars, it sells more new cars, it brings more to the marketplace, and I think it only helps us overall. But ⁓ do understand, and I generally think, removing myself from a political opinion on this, I do understand why the politics say, hey, ⁓ want to keep these out. I do think in general it's probably an overstated scare tactic on the ⁓ on the security that's involved into bringing the tech in here. I think that ⁓ mostly just trying to protect the interest of that do the lobbying from the manufacturer side. But once again, that's just not very well educated decision. It's just looking at it from the outside, looking in, not looking too deep into how I formed that opinion. IgniteUps.ai: Yeah, no, I agree. And right before we we're almost ⁓ but why this ties into the last article I wanted to kind of bring up. And repossessions are the highest levels since the Great Recession. And I read article, Automotive News, this just yesterday. talked about that, you know. Is this something like a dealer's problem? Is this, you know, what this looks like? And and I wanted to say a couple of things about it. And reality is one, the yes, there it was COVID that increased the the the market prices on a lot of them. And a lot of them people say, ⁓ well, that was the dealer being greedy. And and it's furthest from I mean, there were some, don't get me wrong, but the ninety percent of them I don't believe, because here's the problem: that you didn't have new car. Matt Uber - CallGradeIQ: There were plenty of them that were, but yes. IgniteUps.ai: Like you you there's a supply and demand issue. And then what are you gonna do? Go buy and so I was buying a lot of used cars for above market, above MSRP, five, ten grand over MSRP, in some cases twenty grand over MSRP or fifty grand o over MSRP on G Wagons, buying them used. And you think why am I gonna around and sell a new car when we finally get one? Why were we why would you sell it for something when the market dictates a different price? And I think people fail to understand that. And and then this is kind of a a long winded response, but when I think about what's going on with how how ⁓ high these prices have gotten. This our other article that came out that said that there's gonna be two million less new cars on the road by twenty forty. Matt Uber - CallGradeIQ: Absolutely agree with you. IgniteUps.ai: And it's because new car prices continue to interest everything about these payments are are through the roof. And there definitely a shift in just the when COVID happened because the the market basically stopped and everybody ran out of and and just trying to manufacture and you know di distancing and all these other things that the the market was doing to ⁓ Create this havoc on whole economy. We're we're now starting to see a lot of that. And you think about these $800,000 payments that, you know, four or five years ago were a $400 payment, it's it's getting kind of crazy. And so you start seeing all these repossessions. And I looking at comp our places like ⁓ Venezuela and Cuba and how they don't have any more new cars because they just fix their use cars because they're kind of in this position where everything's government owned and what you think that happens or anything changes ⁓ on on whole direction of of more are we gonna see more of this, you think? Matt Uber - CallGradeIQ: Yeah. I think there's gonna be a lot a lot more financial j ⁓ correction that's gonna happen in the next couple of years. I mean, I think we're gonna see it in the mortgages mortgage industry and the real estate industry. I think we're gonna see it in a lot of the correction that's ⁓ a like you said, ⁓ a rebound from happened in COVID and the decisions they make. If we look at our national debt, our national debt, like the individual national debt on credit cards, is through the roof. Like I I don't understand it. I don't know ⁓ how live in this life. I do think that social media is a huge ⁓ control. Contributing factor to how people live significantly over their means. And I think that it will get worse before it gets better. And now the question is: is there ways for these manufacturers to get creative? Like, like, ⁓ how you more cars while a separation and distance regards to differentiating yourself from the others? ⁓ I remember like back to the thing. The thing that made Hyundai ⁓ so unique back in the day they used to have the best warranty. On all the cars, right? they offer like a crazy warranty. one the things that might need to happen if we can't reduce the prices, why not extend the warranties and extend term on the loans, ⁓ making ⁓ vehicles affordable in a monthly cost aspect? If there's a who goes out and can put a guarantee behind the length of their lasting more than 150,000 miles, and you put a term that, that then can be backed by a warranty that can actually live the life the warranty. and the term of the deal, that that's a manufacturer that can ultimately win by cutting down the overall cost without reducing the of the vehicle, but actually making that vehicle more affordable. I've spent of five minutes thinking of that solution. I can imagine manufacturers have many better ideas than I do on that. What you what are your thoughts just in general? ⁓ IgniteUps.ai: think well, I think it's gonna be more of like a renter economy. Like I think about when you you talked about real estate. I mean real estate You know, my oldest daughter just turned thirty and there's no you know, the same area I bought my first home, she there's no way she could buy that home today with her you know, with her salary and what she does. and think the same thing in automotive. I think you're gonna see more and more lease, two maybe two year leases, maybe short gonna shorten those kind of cycles to ensure that Matt Uber - CallGradeIQ: But they're not even affordable either though, Chris. IgniteUps.ai: I know, but I think w if the the only thing that way that that will it happen is that it'll come to a point where you you're are gonna be f or consumers gonna be forced to buy the brand they don't want because it leases well. You know what I'm saying? But because they're getting a newer car that's doesn't have a lot of problems, but it's still a car that, you know, is good and doesn't cause them problems instead of buying a a pre owned one with a hundred thousand miles for thirty thousand dollars. Matt Uber - CallGradeIQ: Yeah, I mean the other thing that I mean, tying back to the real estate, doing the same analogy. I mean, I'm in a house right now that we've got a great interest rate. But my house doubled in price since I bought the car buy bought the house. my wife and I have considered buying a new house or relocating or kind of getting a little bit more out of the city. But ⁓ the reality is could go try to buy another house, turn our equity into that process, but our interest rate's gonna be significantly higher today than what we got on this house in the meantime. So it's not that we afford to move, it's just not a good financial. Decision to move. And there's probably a ton of consumers in the marketplace who could afford to buy a new car. It just doesn't make a lot of financial sense do so when you're in a vehicle. Like when I bought ⁓ truck, I got 0% interest five-year term. It's paid off a long time ago at this point. ⁓ like there's not a lot of those deals out there anymore. And again, this comes back to there has to be a place where I believe if you more new cars selled, you have to incentivize the customer to make it a good financial decision, it either has to be a cost break, ⁓ has to be a term break, it has to be protection on the length of the vehicle actually working during that period. There has to be something that makes a customer incentivized to make that move. And I think there's just ⁓ a lack of that in the space. IgniteUps.ai: I agree. it it's crazy that, you know, we're in a position right now and I just was listening a podcast yesterday where the guy says that this this there's no really short term fix for this, especially with the wars and all this other stuff happening. Realistically it's probably go on for another ten years. And just even the thought of that, I'm just thinking, man, that's that's it's gonna be a grind for sure. Well, ⁓ hey, Matt. I appreciate your time. I think we're we're right at the that mark. and I appreciate of the insight that you brought today. Before we go though, I always ask, could you kind of just, you know, what we think about everything that we discussed, and how can we help the dealers and or the operators apply some of these things to understand how to get better so that they don't, you know, look at some of these headlines as, you know. a a way to, you know, give up or you know, figure out a way to like actually do more and and get better. Matt Uber - CallGradeIQ: A a practice I follow every single day, I require this of all of my new hires, is everybody that comes onto my organization has to go do this process called the four Gs every day. And big part of that process is going thinking of ten things you're grateful for every day. And why that I do that and I have my employees do it, it changes ⁓ the mindset to look at what is going on in your life and finding the positive things that you can take ⁓ from that I would tell you every single thing that we discuss today from repos being ⁓ taking market share, all of that can be viewed ⁓ differently based off the lens in which you view that. I would tell you that at the end of the day, ⁓ is up to you to wake up in this morning. Eat well, to the gym, lift weights, get jacked, and you can do it. Don't make the excuses ⁓ why everybody else can do it, but you can't do it. Don't make the excuse, ⁓ they're just taking steroids, that's why they're more jacked than I am. You up, you do what you can do, control your destiny, ⁓ and will increase the likelihood of a positive outcome. Everything other than that ⁓ is noise, ⁓ creating and you can't change it anyway, so why waste energy on it? My biggest advice is. point the finger back at yourself and identify what can I do today to effect change, to reduce the market share being taken, to make sure my customers are taken care of, to make sure less customers of mine are being repo'd and more customers of mine are buying new vehicles. That would be my recommendation. IgniteUps.ai: agree with that. I think that's ⁓ some sage advice for for any business owner or entrepreneur in the space. I I think everything that she said it is spot on. I think most of the time you know people just need look in the mirror and understand like, hey, if it if it is to be, it's up to me. And you know it's one of things that one of my mentors used to say all the time. And I I, you know, it's the So Until next time, this is Automotive Informance. Thank you everyone for showing up today. Subscribe, share, and ⁓ we'll see you guys next week. Thank you.