{"version":"1.0.0","episode":{"title":"#421 - The Auto Cave Model: Parts, Process, & Overcoming Margin Compression","url":"http://getcarcurious.com/episodes/421-the-auto-cave-model-parts-process-overcoming-margin-compression","audioUrl":"https://anchor.fm/s/8164a88/podcast/play/116406645/https%3A%2F%2Fd3ctxlq1ktw2nl.cloudfront.net%2Fstaging%2F2026-2-4%2F419309613-44100-2-523876a8ddf8b.mp3","description":"In this episode of the Independent Dealer Podcast, hosts Jeff Watson and Luke Godwin tour The Auto Cave in Dallas, Texas with Mitchell Briggs — a buy here pay here operation built around a focused inventory strategy, an on-site parts yard, and a relentless pursuit of margin. If you have ever felt squeezed on recon costs, this episode will change the way you think about your buy box.What You'll Learn:Why zeroing in on Hyundai and Kia transforms shop efficiency and parts availabilityHow to reverse-engineer a lower cost basis by buying cars with known problemsHow Mitchell generated nearly $20,000 in parts sales in a single month from cars he would have otherwise scrappedHow The Auto Cave cut average recon costs by $650 per car — and what that means at 80-100 units a monthHow smaller dealers can apply this model without seven acres and 35 liftsKey Takeaways:Every make and model has a known common problem — buy it with that problem and fix it cheaper than anyone elseCatalytic converters, door lock actuators, headlights, taillights, and engines are where the money hides in your scrap carsThe BHPH dealer who masters the car side of the business wins on every layer: wholesale margin, retail margin, and APRSupport the businesses that support the podcast:Buckeye Risk Services https://theindependentdealer.com/buckeyeBlytzPay - https://theindependentdealer.com/blytzpayIturan GPS - https://theindependentdealer.com/ituranWebsite: www.theindependentdealer.comEmail: info@independentdealer.comFacebook Group: @independentautogroupLuke Godwin: @lukegodwinJeff Watson: /sendtojeffwLike, subscribe, and share this episode with a dealer who is ready to stop leaving money in the junkyard.\n"},"annotations":[{"startTime":38.5,"endTime":48.1,"type":"concept","title":"boneyard","url":"/glossary/boneyard","quote":"Mitch, this is a boneyard. Mitch, this is a boneyard. This is it. Man, this is cool. This is what the money's made. This is where you got money laying all over the place.","canonicalId":"concept:boneyard","priority":0.9,"confidence":0.95,"source":"hybrid-fuzzy+gpt-4.1-mini","data":{"explanation":"A boneyard is a place where damaged, totaled, or end-of-life vehicles are stored and often dismantled for parts. It serves as a source of used components for repairs or rebuilding other vehicles.","simplifiedExplanation":"A boneyard is like a big parking lot full of old or broken cars. People take parts from these cars to fix other cars or sell the parts."}},{"startTime":67.2,"endTime":73.2,"type":"brand","title":"Kia","url":"/glossary/kia","quote":"\"For us, it's the Hyundai Kia, the 2.0 and 2.4. When you do that as a dealer...\"","canonicalId":"brand:kia","priority":0.9,"confidence":1.0,"source":"hybrid-fuzzy+gpt-4.1-mini","data":{"explanation":"Kia is a South Korean automotive brand and sister company to Hyundai. Kia produces a variety of cars and SUVs known for their value, warranty coverage, and design.","simplifiedExplanation":"Kia is a car company from South Korea that makes cars and SUVs. They are known for being affordable and having good warranties."}},{"startTime":82.8,"endTime":86.5,"type":"part","title":"clock spring","url":"/glossary/clock-spring","quote":"\"...when you need a door, when you need a clock spring, when you need a steering wheel assembly...\"","canonicalId":"part:clock-spring","priority":0.5,"confidence":0.95,"source":"hybrid-fuzzy+gpt-4.1-mini","data":{"explanation":"A clock spring is a component in the steering wheel assembly that maintains electrical connections for the airbag, horn, and other controls while allowing the wheel to turn.","simplifiedExplanation":"A clock spring is a part inside the steering wheel that helps keep the airbag and buttons working even when you turn the wheel."}},{"startTime":82.8,"endTime":86.5,"type":"part","title":"steering wheel assembly","url":"/glossary/steering-wheel-assembly","quote":"\"...when you need a clock spring, when you need a steering wheel assembly, when you need a module...\"","canonicalId":"part:steering-wheel-assembly","priority":0.5,"confidence":0.95,"source":"hybrid-fuzzy+gpt-4.1-mini","data":{"explanation":"The steering wheel assembly includes the steering wheel and its associated components such as the hub, controls, and sometimes the airbag module.","simplifiedExplanation":"The steering wheel assembly is the whole steering wheel part you hold and the pieces connected to it."}},{"startTime":89.4,"endTime":93.6,"type":"concept","title":"parts inventory","url":"/glossary/parts-inventory","quote":"\"Yeah. How many cars do you have in the parts inventory? Parts inventory. We've got about 100 junk cars.\"","canonicalId":"concept:parts-inventory","priority":0.5,"confidence":0.95,"source":"hybrid-fuzzy+gpt-4.1-mini","data":{"explanation":"Parts inventory refers to the stockpile of used or new automotive parts that a dealer or repair shop keeps on hand to quickly service vehicles. Having a large parts inventory improves repair efficiency and reduces wait times for customers.","simplifiedExplanation":"Parts inventory means having a collection of car parts ready to use. This helps mechanics fix cars faster because they don't have to wait to order parts."}},{"startTime":93.6,"endTime":95.5,"type":"term","title":"junk cars","url":"/glossary/junk-cars","quote":"\"Parts inventory. We've got about 100 junk cars. 100 junk cars. Now, it takes space to do this...\"","canonicalId":"term:junk-cars","priority":0.5,"confidence":0.95,"source":"hybrid-fuzzy+gpt-4.1-mini","data":{"explanation":"Junk cars are vehicles that are no longer roadworthy or economically repairable but can be used as sources for spare parts. They are often kept in salvage yards or parts inventories.","simplifiedExplanation":"Junk cars are old or broken cars that can't be driven anymore but have parts that can be used to fix other cars."}},{"startTime":119.3,"endTime":123.9,"type":"concept","title":"buy box","url":"/glossary/buy-box","quote":"\"Okay, so you have to have, you mentioned your buy box, like you got your target of cars, that you as a dealership have decided are the best for your buy here, pay it, right?\"","canonicalId":"concept:buy-box","priority":0.9,"confidence":0.95,"source":"hybrid-fuzzy+gpt-4.1-mini","data":{"explanation":"A buy box is a set of criteria or target parameters that a dealership or buyer uses to decide which vehicles to purchase. It helps focus on cars that fit specific needs such as price, condition, and demand.","simplifiedExplanation":"A buy box is like a checklist that a car dealer uses to pick which cars to buy. It helps them choose cars that are good deals and will sell well."}},{"startTime":150.94,"endTime":154.5,"type":"concept","title":"common problem","url":"/glossary/common-problem","quote":"Yeah, 100. Name the year-making model. I'll tell you the common problem behind it. So we figure if every vehicle has a common problem, why not just buy it with the problem already existing?","canonicalId":"concept:common-problem","priority":0.9,"confidence":0.95,"source":"hybrid-fuzzy+gpt-4.1-mini","data":{"explanation":"A common problem refers to a known recurring issue or defect that many vehicles of a particular make and model experience. Understanding these issues helps buyers anticipate repairs and maintenance needs.","simplifiedExplanation":"Some cars have problems that happen a lot with that model. Knowing these problems helps you be ready to fix them if you buy that car."}},{"startTime":199.36,"endTime":203.08,"type":"car","title":"Chevrolet Silverado","url":"/cars/chevrolet/silverado","image":"https://upload.wikimedia.org/wikipedia/commons/0/04/2022_Chevrolet_Silverado_1500_Z71.png","quote":"this with a few models like Silverados or Tahoe's. I'm not buying them unless they have bad transmissions, right?","canonicalId":"car:chevrolet:silverado","priority":0.5,"source":"hybrid-fuzzy+gpt-4.1-mini","data":{"explanation":"The Chevrolet Silverado is a full-size pickup truck known for its durability and popularity in the American truck market. It has had various model years with known transmission issues that some buyers consider when purchasing used examples.","simplifiedExplanation":"The Chevrolet Silverado is a big pickup truck. Some older ones have problems with their transmission, which is the part that helps the truck change gears.","imageAttribution":"LukaCali (CC BY-SA 4.0)"}},{"startTime":199.4,"endTime":203.1,"type":"car","title":"Chevrolet Tahoe","url":"/cars/chevrolet/tahoe","image":"https://upload.wikimedia.org/wikipedia/commons/5/54/2024_Chevrolet_Tahoe_5.3_High_Country_V8%2C_06-20-2024.jpg","quote":"this with a few models like Silverados or Tahoe's. I'm not buying them unless they have bad transmissions, right?","canonicalId":"car:chevrolet:tahoe","priority":0.5,"confidence":0.95,"source":"hybrid-fuzzy+gpt-4.1-mini","data":{"explanation":"The Chevrolet Tahoe is a full-size SUV that shares many components with the Silverado pickup, including transmissions that have known issues in certain model years.","simplifiedExplanation":"The Chevrolet Tahoe is a big SUV. Like the Silverado truck, some older Tahoes have problems with their transmission, which helps the vehicle change gears.","imageAttribution":"Ethan Llamas (CC BY-SA 4.0)"}},{"startTime":203.1,"endTime":206.2,"type":"term","title":"transmission","url":"/glossary/transmission","quote":"I'm not buying them unless they have bad transmissions, right? Because I know that I'm going to have to put one in it.","canonicalId":"term:transmission","priority":0.9,"confidence":1.0,"source":"hybrid-fuzzy+gpt-4.1-mini","data":{"explanation":"A transmission is a mechanical component in a vehicle that transmits power from the engine to the wheels, allowing the vehicle to change gears and adjust speed and torque.","simplifiedExplanation":"The transmission is the part of the car that helps it change gears so it can go faster or slower."}},{"startTime":214.1,"endTime":218.3,"type":"term","title":"market price","url":"/glossary/market-price","quote":"Yeah, I'd say reverse engineer it. So there's a market price on every single part, right? So find out how to be below market on that specific part.","canonicalId":"term:market-price","priority":0.5,"confidence":0.95,"source":"hybrid-fuzzy+gpt-4.1-mini","data":{"explanation":"Market price refers to the typical cost of a part or vehicle based on current supply and demand conditions in the automotive market.","simplifiedExplanation":"Market price is how much something usually costs when you buy or sell it."}},{"startTime":259.1,"endTime":263.3,"type":"concept","title":"fix and flip","url":"/glossary/fix-and-flip","quote":"\"That's interesting that you can increase margin. I didn't even think about that. It's a fix and flip. They're building equity in the car, sweat equity.\"","canonicalId":"concept:fix-and-flip","priority":0.9,"confidence":0.95,"source":"hybrid-fuzzy+gpt-4.1-mini","data":{"explanation":"A fix and flip is a process where a vehicle is purchased in need of repair, fixed up to improve its condition and value, and then sold for a profit. This approach involves investing time, money, and labor to increase the car's market worth.","simplifiedExplanation":"Fix and flip means buying a car that needs work, fixing it, and then selling it to make money. It's like fixing something broken and selling it for more than you paid."}},{"startTime":316.5,"endTime":322.5,"type":"term","title":"engine rebuild","url":"/glossary/engine-rebuild","quote":"So I have a guy who specializes in engine rebuilds. So his name's Angel. Do we do a bunch of them? No.","canonicalId":"term:engine-rebuild","priority":0.5,"confidence":0.95,"source":"hybrid-fuzzy+gpt-4.1-mini","data":{"explanation":"An engine rebuild involves disassembling an engine, inspecting and replacing worn or damaged parts, and reassembling it to restore performance and reliability.","simplifiedExplanation":"An engine rebuild means taking an engine apart, fixing or replacing broken parts, and putting it back together so it runs like new."}},{"startTime":341.6,"endTime":347.5,"type":"concept","title":"economies of scale","url":"/glossary/economies-of-scale","quote":"And then the next step from that is having the same tech work on the same car. And that leads us into the economies of scale. When you talk about, okay, I've got guys that are specializing in this, now they're beating the book consistently.","canonicalId":"concept:economies-of-scale","priority":0.5,"confidence":0.95,"source":"hybrid-fuzzy+gpt-4.1-mini","data":{"explanation":"Economies of scale refer to the cost advantages that businesses obtain due to the scale of operation, with cost per unit of output decreasing with increasing scale. In automotive contexts, buying parts or services in bulk can reduce costs significantly.","simplifiedExplanation":"When you buy a lot of something at once, like car parts, it usually costs less per item. This helps businesses save money when they work on many cars."}},{"startTime":367.0,"endTime":380.4,"type":"term","title":"buy here, pay here dealers","url":"/glossary/buy-here-pay-here-dealers","quote":"I think a common thing that buy here, pay here dealers forget is that they, they're not just in the finance business. They're in the car business, right? And part of the car business is a whole another world called the wholesale world, right? So a lot of times buy here, pay here dealers, they skip the wholesale part, they go straight into buying a depreciating asset at retail value.","canonicalId":"term:buy-here-pay-here-dealers","priority":0.5,"confidence":0.95,"source":"hybrid-fuzzy+gpt-4.1-mini","data":{"explanation":"Buy here, pay here dealers are car dealerships that offer in-house financing directly to customers, often bypassing traditional banks. They typically sell used cars and finance buyers with poor credit but may have higher prices and interest rates.","simplifiedExplanation":"These are car dealers who let you buy a car and pay them back directly, instead of going through a bank. They usually sell used cars and help people who might not get loans elsewhere."}},{"startTime":386.64,"endTime":391.2,"type":"term","title":"wholesale price","url":"/glossary/wholesale-price","quote":"...if you are actually in the car business, you buy it at wholesale price, you fix it, you make that wholesale margin...","canonicalId":"term:wholesale-price","priority":0.5,"confidence":0.95,"source":"hybrid-fuzzy+gpt-4.1-mini","data":{"explanation":"Wholesale price is the amount a dealer or business pays to acquire a vehicle or part before any repairs or retail markup. It is typically lower than the retail price and represents the cost basis for profit calculations.","simplifiedExplanation":"Wholesale price is what a dealer pays to get a car or part before fixing it and selling it to someone else. It's usually cheaper than what you pay at a store."}},{"startTime":396.1,"endTime":400.7,"type":"term","title":"APR","url":"/glossary/apr","quote":"...you make your retail margin, then you make your APR. And that's how you make money.","canonicalId":"term:apr","priority":0.5,"confidence":0.95,"source":"hybrid-fuzzy+gpt-4.1-mini","data":{"explanation":"APR stands for Annual Percentage Rate, which is the yearly interest rate charged on financing or loans. In car sales, it can refer to the interest earned on financing deals, contributing to overall profit.","simplifiedExplanation":"APR means the yearly interest rate you pay if you borrow money to buy a car. For sellers, it's another way to make money from the deal."}},{"startTime":428.6,"endTime":433.3,"type":"concept","title":"parts car","url":"/glossary/parts-car","quote":"I have six and a half acres, I have all these parts cars. So it depends on how deep you want to go.","canonicalId":"concept:parts-car","priority":0.5,"confidence":0.95,"source":"hybrid-fuzzy+gpt-4.1-mini","data":{"explanation":"A parts car is a vehicle kept primarily to be dismantled for usable parts to repair or restore other vehicles. It is often not roadworthy itself.","simplifiedExplanation":"A parts car is a car that someone keeps so they can take parts from it to fix other cars."}},{"startTime":514.2,"endTime":519.7,"type":"term","title":"total loss","url":"/glossary/total-loss","quote":"50% of them. I mean, half we fix half are total loss. And so then, you, you have parts where you can fix your CPI cars too.","canonicalId":"term:total-loss","priority":0.5,"confidence":0.95,"source":"hybrid-fuzzy+gpt-4.1-mini","data":{"explanation":"A total loss is when the cost to repair a damaged vehicle exceeds its market value, leading insurers to declare it uneconomical to fix and pay out the claim instead.","simplifiedExplanation":"If a car is a total loss, it means fixing it would cost more than the car is worth, so the insurance company pays money instead of repairing it."}},{"startTime":539.28,"endTime":544.3,"type":"car","title":"Hyundai Sonata","url":"/cars/hyundai/sonata","image":"https://upload.wikimedia.org/wikipedia/commons/7/7c/0_Hyundai_Sonata_%28DN8%29fl_1.jpg","quote":"... on what we have. So for example, if I have a  11 Sonata that smashed from the front end and I have an 11 ...","canonicalId":"car:hyundai:sonata","priority":0.5,"source":"hybrid-fuzzy+gpt-4.1-mini","data":{"explanation":"The Hyundai Sonata is a midsize sedan known for its value, fuel efficiency, and modern features. The 2011 model year marked a generation with improved styling and technology, making it a popular choice in the used car market. It might be discussed in the context of repairs or parts interchangeability, especially after front-end damage.","simplifiedExplanation":"The Hyundai Sonata is a comfortable car that many people use for everyday driving. The 2011 version is a bit older but still has good features and is easy to fix if it gets damaged in the front. People might talk about it when they need to replace parts after an accident.","imageAttribution":"Benespit (CC BY-SA 4.0)"}},{"startTime":554.9,"endTime":560.2,"type":"concept","title":"collision insurance repair facility","url":"/glossary/collision-insurance-repair-facility","quote":"We're car star certified. So, you know, we're collision insurance repair facility.","canonicalId":"concept:collision-insurance-repair-facility","priority":0.5,"confidence":0.95,"source":"hybrid-fuzzy+gpt-4.1-mini","data":{"explanation":"A collision insurance repair facility is a shop authorized to repair vehicles damaged in accidents, often working directly with insurance companies.","simplifiedExplanation":"It's a place that fixes cars after crashes and works with insurance companies to get the repairs done."}},{"startTime":554.9,"endTime":560.2,"type":"concept","title":"car star certified","url":"/glossary/car-star-certified","quote":"Yeah, we do. We're car star certified. So, you know, we're collision insurance repair facility.","canonicalId":"concept:car-star-certified","priority":0.5,"confidence":0.95,"source":"hybrid-fuzzy+gpt-4.1-mini","data":{"explanation":"Car Star Certified refers to a network of certified collision repair facilities that meet specific standards for quality and insurance repair work.","simplifiedExplanation":"Car Star Certified means the shop is approved to fix cars after accidents and meets certain quality rules."}},{"startTime":640.3,"endTime":645.7,"type":"term","title":"service contracts","url":"/glossary/service-contracts","quote":"...My customers have options of warranties and service contracts, gap. I think it's just been great, Jeff...","canonicalId":"term:service-contracts","priority":0.5,"confidence":0.95,"source":"hybrid-fuzzy+gpt-4.1-mini","data":{"explanation":"Service contracts are agreements that cover specific maintenance or repairs beyond the standard warranty period, often sold separately to extend coverage.","simplifiedExplanation":"A service contract is like extra protection for your car that helps pay for repairs or maintenance after the usual warranty ends."}},{"startTime":640.3,"endTime":645.7,"type":"term","title":"gap","url":"/glossary/gap","quote":"...My customers have options of warranties and service contracts, gap. I think it's just been great, Jeff...","canonicalId":"term:gap","priority":0.5,"confidence":0.95,"source":"hybrid-fuzzy+gpt-4.1-mini","data":{"explanation":"Gap insurance covers the difference between what you owe on a car loan and the car's actual cash value if the vehicle is totaled or stolen.","simplifiedExplanation":"Gap insurance helps pay off your car loan if your car is damaged or stolen and the insurance company pays less than what you still owe."}},{"startTime":640.3,"endTime":645.7,"type":"term","title":"warranties","url":"/glossary/warranties","quote":"...My customers have options of warranties and service contracts, gap. I think it's just been great, Jeff...","canonicalId":"term:warranties","priority":0.5,"confidence":0.95,"source":"hybrid-fuzzy+gpt-4.1-mini","data":{"explanation":"Warranties are agreements that cover certain repairs or defects for a specified period after purchasing a vehicle, providing protection against unexpected repair costs.","simplifiedExplanation":"A warranty is like a promise from the seller that if your car breaks or has problems within a certain time, they will fix it for you without extra cost."}},{"startTime":659.9,"endTime":664.9,"type":"concept","title":"reinsurance","url":"/glossary/reinsurance","quote":"You can set up a reinsurance company. You can ensure your own stop giving money to those third party providers that aren't going to cover your stuff anyways.","canonicalId":"concept:reinsurance","priority":0.5,"confidence":0.95,"source":"hybrid-fuzzy+gpt-4.1-mini","data":{"explanation":"Reinsurance is insurance purchased by an insurance company from another insurer to manage risk and reduce potential losses. It helps companies keep claims and payouts manageable by sharing risk with other firms.","simplifiedExplanation":"Reinsurance is like insurance for insurance companies. It helps them not lose too much money if many people make claims at once."}},{"startTime":700.3,"endTime":710.82,"type":"concept","title":"reconditioning","url":"/glossary/reconditioning","quote":"and we bought it for 1700 bucks with fees. So we buy this car, we slap it onto the ticket of the car we're reconditioning.","canonicalId":"concept:reconditioning","priority":0.5,"confidence":0.95,"source":"hybrid-fuzzy+gpt-4.1-mini","data":{"explanation":"Reconditioning refers to the process of repairing and restoring used vehicles to a better condition for resale. It often involves mechanical repairs, cosmetic fixes, and parts replacement to improve the car's value and reliability.","simplifiedExplanation":"Reconditioning means fixing up a used car to make it look and work better before selling it again."}},{"startTime":775.0,"endTime":780.0,"type":"concept","title":"high mileage","url":"/glossary/high-mileage","quote":"...being 190,000 miles, the book on it has really came down massively. So you've taken that big book hit...","canonicalId":"concept:high-mileage","priority":0.5,"confidence":0.95,"source":"hybrid-fuzzy+gpt-4.1-mini","data":{"explanation":"High mileage refers to a vehicle that has been driven a large number of miles, often indicating more wear and potential maintenance needs.","simplifiedExplanation":"High mileage means the car has been driven a lot, so it might need more repairs or care."}},{"startTime":806.58,"endTime":806.6,"type":"term","title":"repo","url":"/glossary/repo","quote":"you say, Hey, if I get a CPI or a repo or a claim that's close to 200, that's just not sellable.","canonicalId":"term:repo","priority":0.5,"confidence":0.95,"source":"hybrid-fuzzy+gpt-4.1-mini","data":{"explanation":"Repo is short for repossession, which means a lender takes back a vehicle due to missed payments. Repossession affects the vehicle's history and resale value.","simplifiedExplanation":"Repo means the bank or lender took the car back because the owner didn't pay, which can make it harder to sell."}},{"startTime":1305.5,"endTime":1310.0,"type":"term","title":"catalytic converters","url":"/glossary/catalytic-converter","quote":"So we kind of found that in our cats over the years, catalytic converters, they, they did go off. They disappeared.","canonicalId":"term:catalytic-converter","priority":0.9,"confidence":1.0,"source":"hybrid-fuzzy+gpt-4.1-mini","data":{"explanation":"Catalytic converters are emissions control devices installed in a vehicle's exhaust system to reduce harmful pollutants by converting them into less harmful gases before they exit the tailpipe.","simplifiedExplanation":"A catalytic converter is a part of a car that cleans the exhaust to make it less dirty and harmful for the air."}}],"speakers":[{"id":"s1","name":"Jeff Watson","role":"host"},{"id":"s2","name":"amp; Luke Godwin","role":"host"}],"transcripts":[{"url":"http://getcarcurious.com/episodes/421-the-auto-cave-model-parts-process-overcoming-margin-compression/transcript.vtt","type":"text/vtt"}]}