They mention “Mercedes-Benz North Olmsted” as Doug’s dealership. It matters because he’s giving a dealer’s perspective on what’s happening in the market.
This means how many new cars are sitting at dealers and available to buy. Fewer cars usually means higher prices, and more cars usually means more deals.
This is an average of the prices sellers advertise for cars. It shows how pricey cars are getting, even though the final price can be different after deals and discounts.
Concept
new baseline
A “new baseline” is the new normal price level. If people keep paying higher prices, businesses often stop lowering them and treat that higher level as the starting point.
“Supply got cut” describes a reduction in the number of cars available to sell, often due to manufacturing disruptions or logistics problems. In car markets, reduced supply can tighten availability and help keep prices elevated.
Incentives are discounts or deal offers that make a car cheaper to buy. The point here is that if tariffs make cars cost more, companies may have less room to offer big discounts.
Tariffs are extra taxes on imported products. If cars from Europe get taxed more, carmakers often have to either raise prices or offer fewer discounts to protect their profits.
APR is the interest rate on car financing. A “special APR” means the lender is offering a lower promotional interest rate, which can make the loan cheaper.
Ford is another automaker being compared in the hosts’ pricing analysis. They say Ford’s price increases were also higher than inflation over the period they studied.
Cox Automotive is a company that collects and analyzes car-market data. Here, they’re the source for the inventory and pricing trend numbers the hosts are discussing.
“Days supply of inventory” tells you how many days dealerships could keep selling cars with the cars they currently have. More days usually means cars are moving slower; fewer days usually means they’re selling faster.
“Day supply” is a way for a car dealer to estimate how long their current car stock will last. It’s based on how fast they’ve been selling cars recently.
“Trailing several months” means they look at sales from the recent past. Instead of guessing, they use what happened over the last few months to make the estimate.
It means the dealership shows you the best deal right away, before any back-and-forth. You don’t have to ask for discounts or negotiate to get the good price.
It means the dealership figures out the deal price ahead of time. So you don’t have to negotiate or wait for discounts to be “worked out” during the buying process.
Instead of bargaining over the price, the dealership sets a clear deal upfront. That makes buying a car quicker and less stressful because you don’t have to negotiate.
“Move the metal” means sell the cars that are sitting on the lot. The hosts are saying dealers are trying hard to keep sales moving despite high prices.
Concept
dealer level
“Dealer level” just means what the car stores themselves are doing. In this context, it’s about dealerships trying to sell cars even when prices are high.
The Federal Trade Commission is a U.S. agency that helps protect consumers. Here, they’re looking into car dealers that may be posting misleading prices online.
Deceptive pricing means a car price is shown in a way that isn’t really what you’ll end up paying. The show says the FTC is targeting dealers who may be using misleading online price listings.
“Bait and switch” is when a dealer advertises a tempting price to get you interested, but then the deal you actually get is different. The episode links this to misleading pricing tactics.
“Fine print” is the small, detailed wording in an offer that can change what you actually get. Here, it’s being used to describe rules that most people don’t meet.
Concept
dealer add-ons / added requirements
The dealer is basically saying the price only applies if you meet extra conditions. If you don’t, the price goes up.
Loan-to-value is how big your loan is compared to what the car is worth. If the loan is too big for the car’s value, banks get nervous and may not approve the deal.
Concept
leasing vs buying
Buying means you’re paying to own the car; leasing is more like paying to drive it for a few years. The host is suggesting leasing can help avoid getting stuck owing more than the car is worth.
“84 months” means the loan is about seven years long. Since cars usually lose value quickly at first, a long loan can make it harder to sell or trade without owing money.
“72 months” is how long the loan lasts—about six years. Longer loans can make the monthly payment smaller, but you may pay more interest and you can end up owing more than the car is worth.
The Toyota RAV4 is a compact SUV that’s easy to live with. It’s a common choice for people who want one car that works for daily driving and occasional trips.
The Toyota Tundra is Toyota’s full-size pickup. It’s meant for heavier jobs like towing and hauling, but it can still be comfortable for everyday driving.
Trading in means you turn in your current car to the dealer and use the value toward a new purchase. The dealer’s offer matters a lot for how much you still have to pay.
A lease is like renting a car for a few years with an option to return it. You’re usually not buying the car at the end, which can reduce the risk of being stuck with a loan.
EVs are electric cars that run on electricity from a battery instead of using gas as the main power source. Incentives can make them cheaper to buy, which affects financing decisions.
Plug-in hybrids can charge like an electric car, but they also have a gas engine for longer trips. They sometimes get special incentives that can affect the deal.
Depreciation is how much a vehicle’s value drops over time. The speaker is warning that making only the minimum payment won’t “outrace” depreciation, meaning the car may keep losing value faster than the loan balance is shrinking.
The McLaren 570S is a fast, expensive sports car designed for performance driving. It’s not a daily commuter—more of a specialty car. The podcast brings it up while talking about credit or affordability.
A co-signer is a second person who promises to pay the loan if the main borrower can’t. Lenders use it to reduce their risk.
Concept
bottom line price
“Bottom line price” means the final total you’d have to pay. The point here is that even if the dealership gives a clear total, it still might be too expensive for the buyer.
Loan approval is when a bank or lender decides whether it will finance your car purchase. If you’re not approved, you can’t buy the car using that financing.
Bad credit means your past borrowing and payments make lenders think you might be a higher risk. In this conversation, it’s why some people couldn’t get car financing.
Penske is a big company that runs parts of the car business, like dealerships. Here, the hosts mention it to explain what kind of uniform/dress code they had to follow at work.
Dealer reviews are customer ratings and comments about how a car dealership treats buyers. The hosts are saying you can use those reviews to help choose which dealer to shop.
“Out-the-door price” means the full total you pay to buy the car. It includes the car price plus taxes and fees, so it’s the best way to compare different dealers.
A dock fee is a charge for getting the car from the delivery point to the dealership. It’s usually listed on the paperwork, so you can compare it across dealers.
Term
contribution margin
Contribution margin is a way to see how much money is left after paying the costs that change with each sale. It helps you understand whether sales are actually helping the business make money.
LIVE
Hey campers, it's Jan from Toyota!
This summer we're headed to Camp Toyota and the fun starts now!
We're kicking things off by kicking up mud.
Jump in campers, we're going off-roading in a four-runner.
Next, we're heading to the hot springs in a RAV4.
And finally, park your Tundras and Tacomas around the campfire
because we're roasting marshmallows.
Your summer start here!
Dealer in between may vary, so you're participating in Toyota Dealer for Details event and stream first.
Toyota, let's go places!
It's noon here in Ventner City, New Jersey, and I'm putting my phone on silent.
And this is Car Edge Live for Tuesday, May 5th.
Cinco de Mayo, everybody!
Get your Mexican food in today!
With your hosts, me, Ray, here in Ventner City and Zach hanging out in Washington, DC.
And, and, we might actually have a guest today.
I've heard, I don't know.
Indeed, Pops, but before we get into today's show, a friendly reminder to everyone
that today's show is brought to you by CarEdge.com.
Folks, if we can help you out, check out CarEdge.com to learn more about all the work that me, my dad,
and our incredible team do back at CarEdge.com.
For today's show, we do have a guest.
We are so excited to welcome him.
We'll plumb up on the screen right here.
He's a little shorter than me and my dad.
We've got Doug Horner from Ben's and Bowtie's.
Doug, how are you doing this morning?
Wonderful.
Sorry for my delay, everybody.
No, you're here right on time, Doug.
You're here right on time.
We start at noon Eastern and you are right on the money.
Dad, for those in our community that don't know, they probably do know, Doug.
I'm going to pull up his channels right here really quickly.
Doug has done an incredible job doing what I think so many people in the automotive industry want to do,
but a lot of them struggle to do.
He's built such an incredible social following over at Mercedes-Benz North Olmsted.
You can see it right here, dad, over on Instagram and here on YouTube,
as well as over on TikTok, all the places I try and get you to go every once in a while.
But Doug, we're grateful to have you on the show today to get your take on what's going on in the car market
and, pops, I'll leave it up to you first.
We've got Doug.
He runs a Mercedes-Benz dealership.
What do we want to learn from him today, dad?
Well, before we learn anything, Doug, don't take this wrong when I ask,
but what came first, the Benzes or the bowties?
The Benzes came first.
Okay.
And why the bowties?
Back in 2014, I was a salesperson at the time and I was looking for a way
to kind of stand out on the sales floor a little bit.
And I had just learned how to tie a bow tie for a friend's wedding.
And I thought, you know, at Mercedes dealership, we're in suit and tie every day.
Sure.
So I thought, you know, I'll start wearing a bow tie because in Ohio, nobody really wears bow ties.
And I thought at the time, if people forget my name, they'll probably remember the bow tie.
So that was kind of my thought process at the time.
And it just sort of stuck after that.
If I may, I remember in the 60s, mid-afternoon daytime talk shows, and there was a gentleman who came on one of the shows
and he said, you know, everybody can be the same.
The difference.
Dare to be different.
And I'd say you've done that.
And congratulations to you for realizing that even if they couldn't remember your name,
he's the guy with the bow tie.
There you go.
There was a salesman in the Atlantic City area where I worked, Nigel the Englishman.
And he had, he had a mustache that came and hung like down to here.
Nobody could remember his name, but everybody could describe him.
And he was one of the top performing salespeople in the Atlantic City area because of that.
There you go.
Yeah, I love that.
Okay, Zach, you can go down.
No, no, I mean, Dad, you know, just keep going, keep rippin' on bow tie.
Anyway, Doug, we're grateful to have you here.
I think everyone in our community already knows who you are.
So we'll leave you, you don't have to do the brief introduction.
Doug, let's start here.
Me and my dad on this show all the time covered the state of the car market.
We'd love to get our tape on it.
I'm going to pull something up on the screen.
This is on the homepage of Automotive News and we look at it every single day.
It's today's average marketed price as well as new vehicle inventory.
I love when an ad pops up and pushes it somewhere else on the screen.
There we go.
So we're at an average marketed listed price of $51,477 in the new car market right now.
That's up $785 from just a month ago and it's up almost $1,500 year over the year.
I want to start here, Doug.
What's your take on what's going on in the car market right now?
Especially what are you seeing at your dealership and obviously more broadly?
What do you think's going on here in the new car market?
Well, I know that when we were in COVID and every manufacturer started raising prices aggressively
because of what consumers were paying slash what dealers were charging.
However, you want to, you know, make that out.
Somebody said something to me once where it stuck with me.
They're like, listen, people adjust very quickly to elevated prices and manufacturers don't
have a history of dropping them.
Once they've realized that somebody will pay it, that kind of becomes the new baseline
and they move up from there.
So it's like this unfortunate because COVID happened the way it did and supply got cut,
demand went through the roof, all of a sudden prices got jacked up.
The baseline very quickly moved up and now manufacturers really don't see a reason to
go backwards.
So we've got these crazy high average prices which are, I mean, they're just breaking record
after record, which is not a good thing and it was every manufacturer, right?
It wasn't just luxury cars becoming more expensive.
I mean, just about, you know, Stellantis was very famously raising prices on Jeeps,
you know, more so than most manufacturers, but it's just now that that baseline has
been set, it's going to take a lot of work for the price to go back down.
I'm hoping that we can get more incentives that will start to push it down, but I worry
that, you know, unless consumers start pushing back, it's probably just going to keep going
up.
Here's a question for you with the Trump administration announcing that there could be increased tariffs
on EU cars, which, well, would impact Mercedes-Benz.
How do you think that might play out if in fact the tariffs do go from 15% to 25%?
Would that preclude Mercedes from increasing incentives since that could cut into their
profits so dramatically?
Yeah, it definitely can cut into their profits.
I mean, the tariffs have been such an interesting thing because I don't think any manufacturer
wants to be the first one to make a move here.
Like, nobody really wants to be the one that started passing along that increased cost
to their consumers.
So most of them have been eating the majority of it or passing it along in less obvious
ways, right?
Maybe a reduced incentive or an interest rate, a special APR that's a little bit higher.
But it's hard to say because Mercedes has in general barely raised prices on any cars,
like just very normal year-over-year increases.
So if they are passing that along, it's in such a subtle way that I really can't detect
it because we also have better incentives this year than we've had in a long, long time.
So Mercedes is doing their part.
But yeah, it stands to reason that manufacturers at some point are going to want to stop taking
the hit to their bottom line.
Obviously, the tariff thing could might.
There's a chance it happens.
There's also a chance it doesn't happen.
What the reality is right now, their dug is for the broader market prices have gone up.
Mercedes-Benz, like you said, maybe not as obvious that there have been significant
price increases.
You mentioned Stellantis earlier.
We did the research.
They were the number one abuser when it came to price increases over the last decade.
Ford, the number two when we did the analysis, both significantly above the inflation rate.
That being said, we were looking at the latest data.
We've been analyzing this ever since it came out on April 16th.
This is from Cox Automotive.
Day supply falls in March after elevated readings in January and February.
And we love to look at this chart down here, Doug, that shows the day supply of inventory by Grand.
And I am especially interested in your take care on Mercedes because Mercedes here nationally,
at least this is what Cox Automotive reports, has a 104 days supply of inventory significantly
above the nationwide average.
Can you talk to us a little bit, my dad?
I usually cue this question up for him.
But since you're here with us today and you're on a car dealership, I'll ask you,
what does day supply mean for you as a general manager?
Does this matter to you?
And what do you make of Mercedes-Benz being up there at 104?
Yeah.
So the most simple explanation of day supply is, let's say, for example, I had 200 new cars
in stock based on the current sales rate of the last trailing several months.
It would take me 104 days in this instance to sell all of those vehicles, right?
So it's basically saying, how many days will it take to sell all of the cars that are currently on the ground
based on sales volumes over the last couple of months?
So it's definitely something that we look at.
I don't pay too much attention to it because I kind of consider that to be an out of my control type of thing.
And I like to focus on the things that I can control, which is what am I going to do with the inventory I have?
What am I going to do with the programs that I have?
What are we going to do from a social media and marketing perspective so that I'm well below that number?
And the dealers that are asleep at the wheel on the other end are going to be responsible for keeping the average where it is, right?
But we try to operate independently of data like that because I don't want to sit here and be like, oh, wow, what was me?
We're above the nation's average, so I guess things are going to be terrible.
No, we're going to go out there and figure out how do we make it a 60-day supply of inventory?
How have you done that?
Well, social media has helped a lot.
I'll tell you that.
I mean, it's really, it's two things.
We moved to a best price upfront model about two years ago, and we're very proud about that.
And when I say best price upfront, some people hear that and they're like, oh, you just charged everybody.
I'm a Serbian call today.
No, that's not what that means at all, right?
It means it is a very aggressive price that is pre-negotiated, pre-discounted.
You don't have to ask for it.
You get it.
This person gets it.
Everyone gets it when they walk in, which means that everything that we do is about speed and efficiency.
We want to make it the easiest car you've ever bought.
We're very similar to what your mission is, which is make car buying easy, fun, enjoyable, transparent.
And we understand that that works for probably 95% of the market.
There's 5% that love the back and forth and want to go on lease hacker and figure out the cheapest car in the world and all this, that and the other.
That's not going to be us.
But when you're committed to making it fast, easy, quick, transparent like we are, and you're proud of that and you're then putting it out on the internet for everyone to see, people seek you out, right?
Because everyone, they see my videos, they're like, I generally understand what it's going to be like to buy a car from Mercedes-Benz and North Olmsted, and I'm here for that.
And so it brings us a lot of business.
Excellent.
And the reason I say excellent is, at one time I helped one of the dealerships that I worked with move to a negotiation-free selling process where it finally dawned on the owner that, you know, let's just make it easy for people.
Why is it that we've convinced ourselves it's a much better process if we just make it difficult?
Right.
And the auto industry has fallen into that and been in that mindset for 100 plus years.
And, you know, I remember back in the mid 80s when I was at an Nissan dealership and we were building a new facility.
And I sat down with the owner and I said, well, what do you think of the idea that instead of having desks and having the salesperson sit on one side of the desk and the customer sit on the other side of the desk, we don't have desks.
We have coffee tables and we have sofas and we have love seats and we have chairs and we just take away all the artificial barriers and we just make it easier for people.
And he looked at me and he said, you're out of your mind.
Okay.
I don't think I was out of my mind, but I think I might have been 30 years ahead of my time.
Because we're asking people to spend a lot of money.
And why shouldn't it be pleasant?
Agreed.
100%.
Absolutely, it should be.
So we have on one side of the car market right now an affordability crisis on the new car side of things.
Excuse me, a lot of innovation at the dealer level to figure out ways to move the metal to get things going.
There are quite a few other big stories in the auto industry I'd like to get your take on.
I know we're only having for about 10 more minutes like your busy guy over there running your dealership.
I'd like to get your take on what happened earlier this year with the Federal Trade Commission.
I think this is a really, really important story and one that obviously your work of being transparent and building through social media definitely aligns with.
It was earlier this year back in March the FTC sent letters to 97 dealership groups about deceptive pricing.
It was then documented over an automotive news that this is happening in a more widespread fashion.
And we were grateful to contribute here to the automotive news's journalism on what's happening with bait and switch pricing and all sorts of things that the FTC is going after.
What is your take on what the FTC is doing here?
And in layman's terms for our community as well.
It's like they've heard us talk about it already.
But what's going on right now with pricing that the FTC and what's your take on this?
My take is good.
You know, finally, right?
This it's also ridiculous that we that they even have to do this.
But the idea here really is that they want to make sure that dealers that are publishing prices online that are either fake or highly conditional or meant to deceive in any kind of way.
They're basically trying to take the prices that look too good to be true.
And then when you get halfway or into the middle of the fine print, there's some ridiculous disclaimer that disqualifies 98% of people.
They want to get rid of that.
And it just needs to be transparent upfront.
I mean, this is how the business should be.
And it's sad that it's gotten to this point that they would have to do something like this.
But it's obviously very necessary if it's reached this point to get rid of the bad actors that put a price.
I'll give you an example.
You put a price online that includes all of these conditional incentives like you had to be military and a first responder all at the same time.
And also you had to go to college overseas.
Who knows some crazy combination of things that like wouldn't apply to really anybody.
Would it be possible?
I guess maybe for that particular brand.
And then, you know, somebody shows up and they want to buy the car for that price.
And then that's when the dealer was like, oh, well, by the way, did you go to Oxford in England and you're also in the military and you're a paramedic?
Oh, if not, I'm sorry, the price of six ran higher.
Right.
That is the kind of stuff that they want to discourage.
And if this is what they have to do to do that, then great.
Can I ask you a silly question?
How long how long have you been in the car business?
Since 2010.
So coming up on 16 years.
And in your 16 years, how much has the business changed and how much has it changed for the better of your opinion?
Well, in some ways it's changed a lot and in some ways it's changed not at all, which probably is not a very helpful answer.
But for me, I was really fortunate that when I started in the business, I just happened to be at a store that had a really great operational team that did things.
They were very ahead of their time.
They were really leaning into the internet and, you know, selling cars aggressively online and they had a great process.
So I learned the business in like the best possible way.
And I think a lot of people that are in this industry don't realize that if you ended up at the wrong dealership when you started and got bad training, you're kind of like, you're just, it's almost impossible to recover from.
But people don't know any better, right?
You end up where you end up and you get the training you get.
So to me, the industry hasn't changed a ton because I've always had the attitude of just make it as easy as possible, make it quick and give everyone a fair deal that they don't have to argue for for days.
And if they want a price, give them a price, all that kind of stuff.
But I do think that dealers that have been reluctant to do that are slowly coming around to it and that's good.
So I think that we have less and less bad dealerships every year, but it's still not going at the speed that I'd like it to go.
I definitely think you're part of the, you're a change agent, demonstrating, hey, you can operate a dealership differently.
This is how you can do it.
There's a bit of a playbook that I think you with Benzes and Bowties, what you've created there is quite frankly a playbook.
Others could run if they invested in it the way that you have.
I mean, I don't want to speak for you, but I imagine you get stopped in public.
You have a social following and people trust you and like you.
And that's a very different way from the car business operating 16 years ago when you started.
So I commend you for the work you've done to be that open and building your community.
I want to ask you one other question here.
And again, I know you've got a business to run.
And this question is around negative equity.
We have been looking at the data from Edmonds.
I mean, every single quarter they put it out, we do some studies as well.
The most recent data we got Doug was super alarming.
I mean, beyond super alarming.
The rate at which people are underwater on their car loans is growing and the amount that they're underwater is over $7,000.
The research shows that then those that come to the dealership with negative equity end up spending $932 a month on their new car payment.
You were actually quoted in the Wall Street Journal's article on this who talked to us a little bit about what the Wall Street Journal was asking you about negative equity,
what you're seeing with negative equity and your take on this dynamic in the car market.
Is it a good thing for the car market or a bad thing for the car market?
No, it's definitely not a good thing.
That's for sure.
I mean, just mechanically, it's bad because it makes deals harder to get approved.
That's just like the mechanical answer.
And that's for loan to value, which is just obviously every car has a certain value assigned to it by a bank.
And if you're, let's say that value is 50 grand and you're requesting 80 grand to buy it, the bank's going to say,
I'm not giving you 80 grand to buy something worth 50.
So that's the mechanical answers that it's not good for anybody.
The real life answer is that, yeah, it's terrible.
It's terrible for consumers to be in these positions.
And a lot of, you know, trust me, it comes up all the time in my videos.
That's probably why the Wall Street Journal reached out, which I was both, I felt very proud and also a little offended at the same time.
It was just jokingly that they saw my content was like, we got to talk to this guy about negative equity.
But what I see out there a lot is consumers that are just not being honest with themselves in a couple of situations.
And what I mean by that is that people talk themselves into long-term loans because they believe they'll keep the car for a long time
when they don't have a pattern of ever doing that.
And that's a very quick way to get into bad negative equity situations.
I see a lot of people who buy cars that should be leasing cars.
And people, they always look at me and they're like, oh, you want me to lease because it's better for you.
No, statistically, and I'm sure you all do the research on this, every lender I talk to, every manufacturer I've ever talked to,
all the data shows that most Americans, not all Americans, but most Americans are going to get a new car or a car that is new to them within three years.
No matter how they pay for it, whether they pay cash, whether they lease, whether they finance.
So if you're one of those people, don't finance a car for 72 months or 84 months because in two to three years when you go to get a new one,
you're going to be underwater.
It's just how it's going to go.
So, and then I also see, here's the big one, people buying the wrong car for the right price, which is they get,
and I'm not saying don't do your research, of course do your research.
Make sure you're getting a great deal, but if you get too into the weeds of what's the best deal for me,
you're probably going to buy a car that you don't like or doesn't serve your needs.
It doesn't make you, you know, let's be honest, cars are a big part of the American culture.
They're an emotional experience.
Most of us are in a car every day unless we live in a major city.
So you better love what that thing is if you're going to be making a big payment on it every month.
If you buy the wrong car because you got hooked by the deal,
then that's where you show up here a year or two later in nasty negative equity situations because you hate the car you bought.
So you really got to figure out what's the car that I'm going to love and meet my needs
and then how long am I really going to keep it and buy accordingly.
Hey campers, it's Jan from Toyota.
This summer, we're headed to Camp Toyota and the fun starts now.
We're kicking things off by kicking up mud.
Jump in campers, we're going off-roading in a forerunner.
Next, we're heading to the hot springs in a RAV4.
And finally, park your tundras and Tacomas around the campfire because we're roasting marshmallows.
Your summer start here.
Dealer in between Mayberry, so you're participating Toyota Dealer for details event and stream first.
Toyota, let's go places.
That is such great advice because one of the things I found out when I was running a mini store is so many of our mini customers would buy the car.
And I think it was 70 or 80% came back in two and a half or three years to trade it in to get a new one.
And it was like, folks, you should be leasing the damn thing.
You know, admit who you are, that you want a new car every two and a half to three years.
Sign up for a three year lease and guess what, you can do that.
Exactly.
But we are a society of people who usually want more than what they can afford.
And in order to make it appear as if it's affordable, they agree to finance it for a much longer term than is reasonable.
And I would imagine when you see negative equity, you see in numbers that are typically way higher than 7183 dollars.
I believe you had an electric pickup truck, the guy was 40 grand flipped.
Yeah.
Recently.
What did you do for him?
What was the outcome of that?
Were you able to help him?
So, you know, back a year ago when there was all kinds of free government money on EVs and plug-in hybrids, we had a mechanical route to go with people, right?
To kind of absorb that negative equity.
But now when I see people in that situation that don't have a huge down payment to offset it, and sometimes you'd be surprised.
Sometimes people with plenty of money end up in these positions and they do have the ability to dig themselves out of it.
But sometimes it's somebody that cannot dig themselves out of it.
And in those situations, what we do is we just try to give them a little advice.
And my advice in those situations is, look, if I were you, what I would do is I would throw every extra dollar I can comfortably throw at it every month to try to get out.
Don't make the minimum payment because clearly you're not going to outrace this depreciation, right?
So if you can throw another 200 bucks a month at it, do that and just keep chipping away at it until you get into a more manageable spot.
But, you know, I would caution you not to try to find some dealer out there that's going to take that 40 grand negative equity and bury it into some deal somewhere
because they're going to take the problem you have now and probably make it twice as bad overnight.
Doug, your phone's been ringing.
He got people in your office.
Where can folks find you?
We've got your YouTube channel here pulled up on the screen.
If people want to learn more about you or Benz and Bowties or your dealership, where should we send them?
Yeah, so really any of the platforms, Benz and Bowties on all platforms, obviously if you subscribe on YouTube, there's some longer and more involved content there.
TikTok, Instagram, any of the other ones, you're going to get the same videos, so whichever your preferred platform is.
But I appreciate you guys having me on.
Doug, you're welcome anytime.
I think you and my dad, it would be awesome one day to just like get you for an hour even.
I feel like you guys can just riff on how you see eye to eye about the car business.
Thanks for taking time out of your busy day.
We appreciate it.
And again, check out Benz and Bowties, everyone.
And if you want to see Doug back on the show in the future, leave us a comment down below and let us know.
Doug, thanks so much.
We appreciate it.
My pleasure.
Doug, I really appreciate you being here today.
See you, Doug.
Likewise.
Thanks, Ray.
Thanks, Doug.
Talk to you soon.
Awesome when we get guests like that.
It really is.
And Doug, you did a great job.
There's a playbook.
There's a playbook to be run there leading with transparency as a general manager to show
that you can do things differently.
We have said on our show so many times that you can do it that way and then you can differentiate
yourself from everybody else.
And if somebody just interested in beating you up for the last possible dollar, then Doug's
store is probably not the store to go to.
But if you want to be able to get that really fair price up front so you don't have to go
through the hours worth of negotiations, then that's the type of story you need to go to.
And whether it be through the use of social media like Doug's doing or whether the way
you advertise the store about how easy you make it for folks, they're amazing.
I don't agree with you.
I don't think you advertise and get the same outcome as waking up every day.
This guy's been doing it for years.
Years.
He's been waking up every day and making videos.
You cannot advertise your way into that type of trust that you build with people, in my
opinion.
Well, I think that can be part of it.
I'm not saying it's all of it, but I think it can be part of it.
If you're going to do it differently than your competitors, you have to give the customers
a reason why your difference is beneficial to them.
And I think Doug has figured out a way to do it utilizing social media.
There are other avenues as well, but yeah, he is living proof.
The dealership that he helps run is living proof that you can do it right.
That's not to say that he doesn't face challenges with customers on a daily basis because somebody
can walk in with $40,000 worth of negative equity or $20,000 worth of negative equity
or unrealistic expectations.
That's part and parcel of the car business as well.
But the price aspect of it, which is normally the hardest aspect of it, becomes the simplest
aspect of it.
And that's what I admire.
Excuse me.
That's good to see Brandon from CarQuestions answered.
Appreciate you tuning in, Brandon.
And I like this question.
I'm bummed I didn't get to ask Doug this, but many people don't know this.
Brandon asks, how often do you see customers out of new business trying to get a loan on
one of your vehicles?
Most people don't know this.
You worked at a Mercedes-Benz dealership.
My dad has worked for a Mercedes-Benz before, and I think one of the reasons you didn't
like it was because of this exact challenge.
A lot of people that would come in to try and buy a Mercedes-Benz, yeah, I'll let you
share, but yeah.
Well, what I found when I was at the Mercedes-Benz dealership that I was at, it was so many
people said, well, if I can't buy a car, I might as well try to buy the car.
I can't buy because I don't have the credit to buy it anyway.
Okay.
But I'd really like to see myself in a Mercedes-Benz.
And I remember we had a couple one time.
And I believe their credit score was like in the 560s or 570s, and it's like, what are
we doing?
Why would you even think?
Well, let us get a co-signer, okay?
And then they brought their son who had limited credit, had like a 700 credit score, but his
high credit was a $500 or $1,000 credit card.
Well, that's not getting the Mercedes-Benz.
And then they brought two other people that had credit scores similar to theirs in the
560, 570 range, and it was like, okay, well, if I can't get the car, I'm just really not
going to get the car I really want.
And I'm going to go waste my time and their time, and it's unfortunate.
A lot of this, and we've been talking about it for years, is part of it is the customer's
responsibility to understand what it is they can or cannot buy and to truly understand
what they can or cannot afford.
And so dealerships can make it easy and give you a bottom line price.
But if that bottom line price is still way more than what you can or cannot afford, what
the hell difference does it make?
So there's a responsibility on the customer to do some research and understand where they
are in their lives and what it looks like.
Yeah.
I remember you coming home from work and occasionally complaining about, you know, people come in,
they want to buy a Mercedes-Benz, but they just, they can't, we can't get them approved
for a loan.
There's just like no possible way.
There's no way.
Yeah.
I remember, I remember hearing that.
That was why I left.
You know, if I was going to beat my head against the wall trying to get people that had bad
credit financed for something, I was at least going to do it, trying to get them financed
for a reasonable price car where they stood a shot as opposed to an unreasonable price
car where there was no opportunity for it to happen.
Dad, we had this comment come in, did they require you a wear a bow tie?
I know, but you, you used to wear suits and ties to work every day.
I mean, there was a phase of your career, how long, decades, you wore suits to work.
I, you know, when I worked at the, at the Nissan store here in the Atlantic City area,
and I used to, you know, I went through a phase and I really did, I wore suits every
day.
And I remember one day getting on my hands and knees, looking under a car and getting
grease on my suit or ripping the suit at my, and I was like, what the hell am I doing?
And then later in my career, I got back into that again.
But yeah, when you worked at Penske, didn't you at the Acura dealership, didn't you wear
a suit?
We had to, when, when I worked for the Penske realization, we had to wear black pants, a
black belt, black shoes, white shirt.
The only thing we could choose was our tie color.
But otherwise it was white shirt, black pants, black belt, black shoes, black socks, pick
a tie.
That's it, buddy.
The only thing you got to worry about every day, you knew how you were going to dress.
It was just a question of what tie do I want to pick today?
And then when we, when, when at least in, in the Arizona market, when Roger realized
how frigging hot it was all the time, he said, okay, let's go to polo shirts.
But they had to be the Penske polo shirts with the black pants, the black belt, the
black shoes, and the black socks.
Yeah.
Car business, baby.
Hey, you know, we, we've spent a lot of time today talking about Doug and his dealership
and all the way he's done with Ben's and Bowtie's, a friendly reminder, back at CarEdge.com.
We've pretty much built like a Yelp dealer reviews capability.
So go to dealer reviews, click on ratings and overview.
This ratings and overview comes from all of the dealers that we reach out to 54,303 verified
out the door price quotes.
We then grade dealers from A to F. I encourage everyone to look at the dealer reviews, look
at the map.
You can break down this map by state, by brand, by grade.
So I encourage everyone to spend some time over here on the CarEdge dealer reviews when
they're doing their research for their next vehicle.
You can find some A rated Mercedes dealerships out there and maybe some C rated ones that
are not so transparent.
So trying to help out as best we can here to help you find dealers that are maybe worth
your time.
And, you know, let's look at this one really quickly, dad, you know, negotiate.
We've gotten five quotes from this dealership.
We know, you know, that they have, what is it here?
They do $599 in add-ons on all their cars.
Their quoted price is about 3% higher than their online advertised price.
Their Dock fee is just under the Utah average.
So good data here, back on the CarEdge platform for the dealer ratings and dealer reviews.
From Rich, we had a very kind contribution coming here.
This is very generous of you.
I found a car for pops that won't require butter and a shoehorn to get it in the Ducati
Type 41 Royale Kellner.
Got it.
Got it.
Okay.
So it's not going to require butter and a shoehorn?
Royale.
Kubei.
What was it, dad?
Kellner?
Kellner.
K-E-L-L-N-E-R.
Oh, yeah.
Okay.
Yeah.
The rock in this.
Yeah.
I can see you getting in and out of this.
Oh, yeah.
That would, oh, absolutely.
Oh, and yeah, I could, I would even get one of those outfits so that I could really look
and dress the part.
The Argyle socks are special.
I wouldn't have been allowed to wear those at Penske, but, but yeah, that's beautiful.
That is a big, big giant car.
That's a big giant car indeed.
Holy cow.
Look how long the hood is.
No, it's a long hood, man.
It's a big car.
I bet you it's got a giant engine.
I bet you it does indeed.
All right, folks.
If you found today's show helpful, useful, valuable, informative, entertaining, please
give a like on the video and subscribe to the channel.
Looking forward, we've got another guest joining us tomorrow, a mechanic.
We've got a mechanic joined in the show tomorrow, so we've got to think up some questions.
We want to ask our mechanic guests, so stay tuned for that.
We'll have more guests on the show in the near future as well.
We appreciate Doug joining us today.
Of course.
And dad, let's do it all again.
Oh, let's share with everyone.
We were not here yesterday, dad.
We were not.
Because?
Yes.
I cannot believe I'm saying this.
I was a guest lecturer at Dartmouth College up in New Hampshire yesterday on the carbine
process, and it was behavioral economics.
Two behavioral economics lectures that I went at Dartmouth College with a professor
up there who does research on consumer finance, consumer credit, and teaches behavioral economics.
What a cool moment for me, man.
I had so much fun.
So much fun.
The kids, the kids, the young adults were super engaged and asking lots of questions,
and it felt so good.
It felt like I was teaching the next generation.
It was so cool, man.
Yeah.
And what I found interesting about it, and I will share this, is when you told me you
were going up to Dartmouth to be a guest lecturer, I looked up Dartmouth, and I believe the tuition
is about $65,000 a year.
That's just the tuition.
That's not books.
That's not room and board.
That's just the tuition.
And that they accept 5.4% of all the applicants that apply.
And I'm thinking to myself, these are kids that are at the highest academic levels to
be able to get accepted there, are paying a fortune to suddenly be lectured by a college
dropout.
The irony in that was just, I could not get over that.
That we're taking, I mean, if the parents found out that their children were being lectured
by a college dropout after their drop in $65,000, $75,000, $800,000 a year for that education,
the parents have to be saying, what are we doing here?
No, I think it was great.
I am so proud of you for that.
Thank you.
It was really cool.
It was an economics to be clear, but behavioral economics, and obviously I can talk about
the car market and some of the biases that are present in the car market.
But so many of the kids in the room, dad, are interested in becoming entrepreneurs.
They ask me questions about starting the business.
They did a ton of research on me on my personal website.
It was so fun.
It was so rewarding.
And yeah, definitely give them a different perspective, which I think is partly what
a college experience is supposed to do as well.
Well, one would hope.
The idea behind college is to open your mind up to all types of perspectives, not just
the one that you've grown up with.
Yeah, absolutely.
I was also impressed with how diverse it was.
So many kids from young adults again, from different countries that were there.
I met a woman from Georgia.
I was like, the country Georgia.
I was like, I've heard an accent from the South before.
She's like, no, from Europe.
Whoa.
So yeah, really cool experience.
And thank you.
Thank you for this kind of contribution.
I'm really proud.
I'm really proud too.
And also kind of hilarious because I kind of looked like I could have been one of the
students as well.
So yeah, but anyway, you know, another thing, dad, I'll just mention it now.
We're not going to have a show next Tuesday, most likely a week from today because I will
be keynoting the, actually, I guess we can do the show afterwards.
I'll have to, I'll have to see.
Let me see.
Give me one second.
Yes.
Yes.
You're, you're keynoting something.
I'm keynoting.
And dad, I got to tell you, yeah, you know, I've done a lot of public speaking, so I think
I'm okay.
Yeah.
Yeah.
The auto industry AI conference.
Let me pull this up for you though.
Where is it?
It's at Maryland Live.
So it's actually very close to where I live.
It's in Maryland.
Oh, yeah.
Yeah.
But wait a second, stay with me for a second.
Yeah.
Should I come and, and, and view you or are they going to charge me for a ticket?
I mean, we could get you in, but I don't, I don't, no, you don't want to come down.
It's fine.
Wait for it.
Give me a second here.
We're trying to give you as much time as you need, but, you know, we are, we are the
stage that I'm going to be presenting on dad is this, wow, that's a pretty big ass
stage.
Yeah, it's massive.
Yeah.
Wow.
That's going to be me.
Wow.
Wow.
I hope you have stuff prepared.
I'm working on it.
Oh, that's good.
Yeah.
But it'll end up being back on, it'll end up being back on YouTube.
So I can't wait, can't wait for everyone in our community because it's, to be clear,
it's an industry event.
Wow.
I can't wait for our community to see the way that I communicate to the automotive industry.
Yeah.
I think they would, I think they would be pleased with how you, how you articulate what
you hope the future of the industry is.
Yeah.
100%.
Anyway, y'all, thanks for tuning in to today's show and for listening to all my antics for
the past 10 minutes.
Dad, let's do it again tomorrow.
Sound good?
Uh, I'll be back.
I promise.
Yeah.
Absolutely.
All right, y'all.
Thanks for tuning in.
Love you, dad.
Love you too, handsome.
See y'all back here tomorrow, everybody.
Hey campers, it's Jan from Toyota.
This summer we're headed to Camp Toyota and the fun starts now we're kicking things off
by kicking up mud.
Jump in campers, we're going off-roading in a forerunner.
Next, we're heading to the hot springs in a rad four.
And finally, park your tundras and Tacomas around the campfire because we're roasting
marshmallows.
Your summer start here.
Dealer in between Mayberry, so you're participating Toyota Dealer for details event and stream
first.
Toyota, let's go places.
If you liked the show, please take a moment to rate, review and subscribe.
It really does help the show to grow.
Thank you for listening.
About this episode
Rising new-car prices, tariffs, and inventory levels set the tone as Doug Horner explains why elevated prices often stick once buyers accept them. The conversation then shifts to dealership transparency, with a best-price-upfront model, FTC scrutiny of deceptive online pricing, and the growing drag of negative equity on approvals. The hosts also dig into why long loan terms can trap frequent traders underwater, while closing with personal notes about a Dartmouth lecture and industry events.
Today on CarEdge Live, Ray and Zach are joined by Doug Horner of Benz&Bowties. Tune in to learn more! Hosted by Simplecast, an AdsWizz company. See https://pcm.adswizz.com
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