This is about dealerships combining jobs that are usually done by different people. Instead of one person handling sales and another handling finance, one manager may do both—so the dealership needs strong leadership to keep everything running smoothly.
Lithia is a big company that owns and runs car dealerships. In this episode, they’re described as changing how employees are assigned—so one person may handle both sales management and finance tasks.
They’re talking about a dealership where the same manager handles both the sales side and the finance side. The concern is that it can make the process less effective unless the dealership has strong leadership and clear separation of responsibilities.
Dealers often measure results “per deal,” meaning per car sold. The speaker is saying that the profit from each transaction can get smaller under this staffing approach.
“Back end” is dealership-speak for the money made after the car sale, like financing-related products and add-ons. The episode argues that staffing changes can reduce how much profit the dealership makes from those items.
CarMax is a large used-car retailer. In this segment, they’re used as an example of a company that gets many customers to buy warranty add-ons, but still doesn’t necessarily make big profit on them.
“Warranty penetration” means how often customers say yes to an extended warranty. The episode is pointing out that even if a lot of people buy it, the dealership can still make less profit if the warranty is priced aggressively.
Group One is a dealership company. The episode compares how much profit they make from the “back end” (finance products and add-ons) versus other dealership groups.
A remote service advisor is like a service employee who helps customers from a distance—using phones or video instead of in-person. The guest says it can help prevent arguments from turning into violence.
Chick-fil-A is mentioned as an example of a brand experience. The point is about how customers feel when they’re greeted by people versus using automated/self-service options.
McDonald's is mentioned as another example of a brand experience. The speaker is using it to talk about what feels better to customers—talking to people or using automated systems.
The “service drive” is the part of a dealership where you pull in to get your car serviced. The hosts are talking about how the service advisor you get can make the experience better or worse.
An “upsell” is when the dealership tries to sell you extra work or upgrades on top of what you came in for. The hosts are saying good advisors do this in a way that keeps customers coming back.
A “virtual advisor” is like getting help from a computer or app instead of talking to a person at the dealership. It can guide you through buying or service steps, but it may not work as well if the internet or system goes down.
Gemini is Google’s AI assistant. Here it’s mentioned as another tool that could help people understand car problems without immediately needing a human expert.
ChatGPT is an AI program that you can talk to like a chatbot. In this context, the host is saying AI could help figure out what’s wrong with a car by using your description or images.
Grok is another AI chatbot. The idea being discussed is that you could use it to help identify what’s wrong with something—like a car—based on what you tell it or show it.
To “diagnose” a car problem means figuring out what’s actually causing the issue, not just guessing. The hosts are saying AI might help do that step faster, which could change job roles in repair shops.
EV means electric vehicle. The host is saying EVs may be easier to troubleshoot in some ways because they don’t have as many moving parts as gas cars, though the electrical systems can still be complex.
The Mercedes-Benz SL is a luxury roadster, meaning it’s made for driving with the top down. It’s designed to feel sporty but also comfortable and feature-rich. People mention it because it’s a well-known Mercedes model for open-air driving.
The Mercedes-Benz S-Class is a large luxury car meant to be very comfortable and quiet. It’s built to feel high-end, with lots of features and technology inside. People talk about it because it’s one of the brand’s most advanced sedans.
A car broker is a middle person who helps you get a car deal. If pricing is hard to compare, brokers can add value; if pricing becomes easy to see everywhere, their role can shrink.
Concept
mass kind of Dispersal
They’re talking about how deal info gets shared widely, so people in one state can see what people in other states are getting. When that happens, the “secret” local deals get harder to find.
In this context, “transparency” means car prices and deal terms are easier to see. If everyone can see the same info, it’s harder to get big discounts through negotiation.
“Delivered” is mentioned as a company/service that shares a lot of deal details. The hosts think that if everyone can see the deals, brokers may become less necessary.
CarEdge is mentioned as a service that shows deals more openly and charges a recurring fee. The hosts wonder if that kind of transparency eventually makes the service less valuable.
Rivian is an electric-vehicle brand. In this discussion, it’s mentioned as an example of selling cars more directly to customers, which can make pricing feel more uniform.
Direct-to-consumer means the company sells the car straight to you, instead of using the usual dealer negotiation process. The goal is often a simpler, more consistent “one price” experience.
Scout is mentioned as another brand using a direct-to-consumer style. The idea is that when the buying process is standardized, there’s less room for traditional deal middlemen.
Ferrari is a famous Italian car brand that people associate with beautiful, high-end sports cars. In this discussion, they’re saying Ferrari’s new EV idea doesn’t match what fans expect from the brand.
Puro Sangue is a Ferrari model that’s more like an SUV/crossover than a traditional sports car. The hosts mention it to argue Ferrari’s newer directions haven’t matched fan expectations.
Brand
Luca
“Luca” here refers to a well-known Ferrari leader. The hosts are using his comments to argue that Ferrari’s new direction could hurt what fans believe Ferrari stands for.
The Tesla Cybertruck is an electric pickup truck made by Tesla. It uses electricity instead of gasoline, and it has a very unusual, sharp-looking design. People bring it up because it’s a different kind of truck than most others on the road.
“All electrical vehicle” means a car that’s fully electric, not a gas-electric hybrid. The hosts are saying Lamborghini canceled that kind of plan after negative reactions.
Lamborghini is another famous Italian high-performance car brand. In this segment, they mention Lamborghini’s CEO to show that not every automaker is choosing the same EV strategy as Ferrari.
The Mercedes EQS is Mercedes’ electric luxury sedan. The speaker uses it to point out that Mercedes’ EV interior looked great, even if the overall EV push had business problems.
Term
Bud Light moment
“Bud Light moment” is a comparison to a real-world situation where a brand faced backlash and lost trust or identity with customers. Here, they’re saying Ferrari could be heading toward the same kind of brand backlash.
The DeLorean DMC-12 is a sports car with a stainless-steel look and doors that open upward like wings. It’s famous for its unusual appearance and has become well-known over time. People often bring it up because it stands out visually from most other cars.
“Quad motor” means the EV has four electric motors. More motors can help the car accelerate harder and grip better because it can control power to each wheel more precisely.
Jaguar is a luxury car brand. The host is using it as an example of something that went badly for a previous person, to make a joke about job risk.
LIVE
Zach Fritz: Welcome back to the Automotive Informants. My name is Zach and I've got my buddy Chris Martinez here with me today. Thanks for joining, Chris.
Chris J. Martinez: Thank you, Zach. ⁓ always good to have ⁓ this good topic session. Basically headlines, whether or not the ⁓ the they're just noise or if we can help dealers sell more, help them service more and just all around be be more profitable. but you know, you know, some of these headlines we have this week or this last week, there's there's several to unpack. I don't know if we'll be able to get through all of them. but
Chris J. Martinez: Which you know, we can go all over there's there's a bunch of them we can talk about. I don't know what which ones you wanna kinda go through, but ⁓ we can start off the Ferr well, I mean we've got Ferrari, we can talk about there's a couple of other ones that we were d discussing, but one of the ones that I I kinda wanted to just bring up to the top before we get into the the the more exciting one, like Ferrari, but ⁓ let's let's talk about group one. They're cutting
Zach Fritz: Well we gotta deep dive Ferrari. That's
Chris J. Martinez: 700 jobs and and this is like a two-part headline, right right. There's two like basically back to back. One group one seven hundred jobs cut and then a lithia headline that had almost similar there. So the seven hundred job cuts, what do you think ⁓ about the group one? L and I can read you exactly what what the seven hundred job cuts said. He they basically said that they're gonna be
Chris J. Martinez: Virtual F and I could be one of the biggest opportunities for the dealership. there they w actually cut one role I thought was kind of interesting was their deal scanners. Apparently had employees just scanned deals all day.
And and I I've been to stores that had that role and not to put anything bad against that role, but you think about, you know, some of these older stores that didn't really have they haven't been scanning their deals.
⁓ Since you know, I mean CarMax, we were doing that in two thousand two five, I think is when we started doing that. I think it was two thousand five. So it it's kind of interesting to see that but we scanning the the deals as they contract it.
So as soon as they were done, we just put ⁓ in a scanner. It just went right through everything and ⁓ boom, we were to go. But they are actually having
Chris J. Martinez: People go back years to scan all their deals. So what do you think about some of these cuts?
Zach Fritz: It's interesting to see. I mean, I think that it almost indicates a bigger shift across the industry where we are seeing tools come out and be implemented, you know, different forms of AI, different processes.
People, you know, I don't want to call it just kind of throwing crap at the wall and seeing if it sticks, but for lack of a better expression, it sort of is. And that's neither good nor bad necessarily, right?
I mean, the industry has to evolve with technology and as times modernize. But it is interesting to see it start to affect other parts of the dealership. Traditionally, it's mostly been just the service drive, where we've seen processes get implemented and jobs get eliminated.
And same thing with, you know, going back to detail, porters, parts departments. We are seeing it now roll to sales, finance, and other parts of the dealer floor.
Chris J. Martinez: Yeah, you're seeing that they're trying to simplify a lot of things and remove a lot of friction and I think that's where a lot of AI is coming into place. and I think that that was that's maybe part of some of the things that they're they're how they're cutting.
They didn't really, you know, dig deep into which roles and the only thing that they they kind of talked about was the virtual F and I, which is kind of interesting because it was similar to what Lithia's restructuring was doing.
And so you I've even seen it where some of the people were commenting on these posts that they were some of the sales managers were let go. The people just walked in and boom, they just got terminated.
so it's it's interesting to say the least. But you know, talking about Lithia, their restructuring plan,
Chris J. Martinez: kind of tied in with this specifically, they're doing virtual F and I assistance or not assistance, but actual contractors where they'll, you know, instead of having, know, fifty finance managers, they o maybe only need, you know, fifteen.
And they all work centrally or, you know, at home or I don't know how they're gonna they're working ⁓ but I imagine they're at a a a central location and as deal comes in, they're all in a rotation and it pops up on their screen and they kinda go through the
Chris J. Martinez: the whole contracts 'cause, you know, if they've got Docupad, they can do all of that on the pad and they walk ⁓ through where to sign and maybe there's two documents that the salesperson might hand ⁓ that they need to sign, but outside of that they they really don't need to have a finance manager at the store. So I think that's interesting.
Zach Fritz: Yeah. It's funny to me because I think the way I've traditionally seen it, I mean, in a dealer you've got, let's face it, most of the time it's a little slow, right? You get your small rushes here and there.
And so you do end up having a lot of downtime. I think that by basically consolidating what they're doing and having a finance manager who can cover multiple locations virtually, which finally we've gotten to that point, right?
I think one, it reduces some friction on the customer as well as stress, right? It's always a stressful moment whenever you've got all of your paperwork going to the finance manager, your salesman's running it back and forth, and it's like, well, let's see what my finance manager can do, right?
Like it's just weird and it's uncomfortable for a lot of people. So enjoy that. But then we are seeing I'm interested to see the pay structure for the finance managers, right? Especially if they're working deals across multiple locations versus
Chris J. Martinez: Well, from my yeah, my understanding, some of actually commented and they it was a definitely a substantial reduction in in in pay. ⁓ but then you think about like Lithia, they're they're moving more towards a hybrid model where they don't no longer have a dual role.
They they combine the role so that the sales manager now is the finance manager. So And I've s and I've been at stores where that that does work, but you need a a strong execution from the the management team to really build that culture.
And if you don't have that culture, that then it really all it does is it from an experienced side for a consumer is good. However, you end up you end up your per copy in the back end actually gets reduced.
It's actually when we s when we saw at one of our stores, we tested it and know, just trying to get the the whole culture.
Chris J. Martinez: And you know, you really need to be in the store it to really work. but if you can't and you're hiring people and you you just go through a bunch of people because what ends up happening, they end up running, you know, ⁓ smaller margins the back and you know, I've I've heard the argument where they say, Hey, look, you know, y you end up offsetting that because you reduce that margin, you still offset it offsets on the c the employee comp, but it's not really three hundred dollar margin reduction.
It's more like an eight hundred dollar margin reduction. And so you're you're not only just giving like offsetting c ⁓ compensation, but you're losing money. So I've seen it, know, and the the that part I've seen more often than the other part where they actually execute.
Because like CarMax, they had salespeople sell the product, but And they had high warranty penetration, but look at the margins that they had on there. And honest, I mean CarMex they they set the prices so you know they probably could ac actually make more money in the back end, but they just basically give those products away.
think they there's there's opportunity there if they can really sell to the team and more importantly have good people, good there to help manage that process.
Zach Fritz: I think that too, you know, this is this is probably one of my little more out there thoughts, but from the perspective of the type of talent you would need to perform in a dual role position like that, you would really need not just your A players, but your A plus players, right?
To set to sell it from a sales perspective, but then also finance, right? And not screw up on either side. So you would need a lot of coordination and a lot of buy-in from the team. But I also wonder, this also kind of potentially a slick move to maybe some of that talent or lack of talent, let's face it, that we've seen kind of flood into the industry over the past few years where people just really aren't cut out for it.
It's not, you know, the salespeople and the finance people of days of old, but instead we've kind of seen this different generation of people who really couldn't do much else that came into the dealership and just unfortunately aren't really cut out for it.
And a large group such as Group One or Lithia, it would probably turn some heads if they just came through and said, Hey, we're just gonna cut some of our less talented people.
Chris J. Martinez: Yeah, anytime you're doing that, it it really you if you keep a lot of the people there, but then they realize that you did that to their friends that they've been working with for a long time, that really could be detrimental.
So it you know, you're almost at in a position where you may need to like, you know, start all over, like, you know, hire a whole new team. I mean, that's And in in my experience and what I've seen and we've tested at multiple locations and different environments, it what happens is like specifically on the sales manager side, they're so involved in the deal that they're already sold on that idea that when they go to now contract the deal, they're already so emotionally involved in the deal that they're like, ⁓ this guy already said no, I'm not gonna be able to do it.
Chris J. Martinez: They just not don't try again. Right. Where now or the whole reason why they created the finance manager was to have that separation. They're no longer like married to the deal and it's like a fresh set of eyes, and you come in and you can still build value in the products and slow it down and and take control and and do those those upsells for the benefit of both the customer and the dealership. And I think that's
Chris J. Martinez: We'll see. I mean, I I've seen like the Walzer group, they they talk about it, and from what I've looked at or I've heard their their margins don't compare to like group one's back end margins or I think Auto Nation has the highest back end margins out there in the country.
I think they're running probably the biggest back end. but they also have some addendums and things like that, from what I hear, that get get added to the back. So ⁓ who knows? It's gonna be interesting.
The one part of this whole story that really caught my attention was the remote service advisor for lithia. What do you what do you think? What do you what does that look like? Is that just a ploy to
Zach Fritz: Mm-hmm. Yeah. do you want my perspective as a technician? Or do you want
Chris J. Martinez: I do. I want your perspective on on it all, Sarah. What do you think?
Zach Fritz: I mean, let me tell you, from a technician's perspective, a remote service advisor is absolutely amazing. And I think it is the best way to prevent workplace violence. So, but think, you know, it's tough because as a consumer walking into a dealership, it is nice to have that kind of in-person handoff, right? I the type of person I absolutely hate a kiosk. I don't want, I don't want to deal with it if I'm.
Chris J. Martinez: Ha ha ha. They're terrible. They're terrible. Those yeah.
Zach Fritz: Going somewhere I'd I want to deal with a person. It's the experience and it gonna be interesting. What your take?
Chris J. Martinez: Well, I'll I'll let me tell you my experience. just even like walking into Chick-fil-A versus McDonald's or even walking so just recently there was a business that just opened up down the street and then those Alsay bowls. I don't know if you've ever had one of those. They're pretty amazing. I have those, they're great snacks.
Chris J. Martinez: probably not the healthiest thing, but the fruit is amazing, right? But anyways, they opened up one. There's one literally five minutes further from this new location, but this new location was closer to my home, different company, different brand.
And so I said, Man, that I'm gonna go try it out. So I walk in, and the first thing they do is, ⁓ yeah, you gotta go order on that kiosk. And I was like, Okay. And so then I had struggled and was like doing it, and it just wasn't the easiest thing.
And and then it just took forever. And I finally l locked it in and hit submit, paid, did all that. It took it took me a while because it just wasn't that user friendly. Well, then by the time they got they gave me my my Os that bowl, ended up, you know, it wasn't as good as the other location, but it just wasn't the same like experience.
And guess what? Maybe two months later it closed down. So I think there's a lot to be said. The other location is a little bit you know, more friendly, hippie type, you know, people environment that, you know, just works.
and it it it's better. I mean, it was just the the the bowl better. But so I think people will w end up just move there's gonna be a percentage that just don't want that. They want to have that, you know, relationship and they've had that advisor for, you know, 20 years and they've done a great job and always recommended the services.
And so for me, I'd rather be more like Chick-fil-A. They're the on average their stores are more profitable than McDonald's. and because they they provide that experience where McDonald's, they do majority them have those kiosks.
Zach Fritz: There's definitely something there to be said about having that intrapersonal connection that, you know, it it's the intimacy, right? Of the intimacy of the deal, whether it be the intimacy out on the sales floor, right?
Dealing with a salesperson who's either great or they suck, and you know it pretty quickly, again, that's why talent exists in our industry. And it also applies to the service drive where you've got a great advisor or you can have a terrible advisor.
The great ones. Will always get you upsells, they will always sell service, and they keep customers coming back and they drive revenue for the sales floor. you've got the terrible ones who drive customers away.
Now what happens whenever we land in the middle and we have all these virtual advisors and what happens when the internet goes down?
Chris J. Martinez: There's always gonna be that, but here's the other the counter argument, okay? With Chat GPT and Gemini and all these news these new tools, you know, there was a a conversation that Elon Musk was having with somebody and he said, Look, real realistically, if you're going to school and you wanna be a doctor or lawyer, reality is don't go because in five years you just won't need ⁓ And I was just like, Man, so
Chris J. Martinez: You think about it, most know People in those type line of work are now asking AI. And so now you just start Grok or start Chat GPT, record and say, Okay, what is this sound? Why is this thing making noise?
And then it diagnoses it exactly. And so now do you just go in and you tell the computer, Hey, ⁓ this is what's wrong, this is what you need to do, and then the tech gets it and then confirms then it gets fixed.
And ⁓ at point advisor, do you still need it? And so that that's where I'm I think the counter argument is. because now you take pictures of things and it's it tells you exactly what's wrong with it and how to ⁓ it you, it'll even give you all the YouTube links to to fix it yourself, which is interesting.
Zach Fritz: I can tell you from first hand experience, without saying too much and violating an NDA, that technology is coming. There are technicians, mechanics, people who are highly, highly trained in the field of repair who, know, may or may not be training AI models for large scale deployment.
And that is coming. Now I don't think it'll come to robots actually physically performing the work because it does require some, you know. Dexterity. However, yeah, for diagnosis perspective and reducing the cost to fix the Gar, it is coming.
Chris J. Martinez: Well, if you have s seen lately, Tessa makes these robots. So, you know, they should be able to turn a wrench if you look at what they're doing. You know what I'm saying? So I don't know. ⁓ don't know. It's gonna be an interesting time to say the least. I think
Zach Fritz: That's I'd love to see them cuss out a service advisor.
Chris J. Martinez: what we're seeing in real time, how quickly things are iterating and and and expanding, I do think there are gonna be some some ways ⁓ are gonna completely reshape our industry let alone the whole world, right? But ⁓
Chris J. Martinez: Do I think it's gonna be this mass exodus or do I believe that it's just only gonna now you're gonna have different roles different places because now you can use technology at a whole different level and and perform at levels that you've never been able to?
And I think that's really the d direction I think this this is actually gonna go. I I don't think it's gonna be to a point where I do think some some j jobs and will be eliminated. I do I do think that, but it's only gonna create other opportunities for other people to peop for people to do other things.
And I think that's that's really what's gonna happen.
Zach Fritz: Absolutely. I mean, I look at from just a diagnostic perspective, you're familiar with C D T, right? From the Mercedes World and technicians. Those are the highest paid people in the shop and they don't even touch the car. They diagnose the car and pass it off.
Chris J. Martinez: Mm-hmm. Yep. Yeah. Well they they they go the all they do is diagnose it and say, Hey, this is exactly what's wrong. And so then that that role could be eliminated, I imagine, right? Yeah.
Zach Fritz: Absolutely. And I mean, we won't say it here, but you know that those those people are paid very, very well. And if we can reduce that, that's a cost savings for the customer, that's a cost savings for the dealership and
Chris J. Martinez: Yes, sir. Yes sir. But have you s and and that's why I think the allure of the EV it is so appealing because from a technology standpoint you don't have that many moving parts. challenge is is all the electrical that you do have. And when I've seen some of my techs or shop foreman diagnose the jobs I've ever seen.
Chris J. Martinez: And I'd walk back there and you'd see this whole I I I thought he had was like a bomb or something because you had wires and and I'm like, man, I don't even know how how you're doing that. And it's it always impressive to see ⁓ when they would, you dismantle some of these these vehicles and th they'd have like thousands of wires everywhere and I'm like, and you gotta put that back together? God bless you, man. I don't know how you're doing it.
Zach Fritz: Mm-hmm. Yeah. ⁓ some of these, you gotta think, you know, I'll throw out a couple facts. The Mercedes-Benz S class has more code written to its control modules than a Boeing seven forty-seven airplane, and those planes can land themselves.
That was always a common one. And that came around, you know, twenty sixteen to twenty eighteen. So I can only imagine now. there's a reason why people can diagnose electrical problems, right? There's a reason why people like myself, I got recruited out of the dealer world to go into ADOS because there is such a lack of talent.
So trying to retain that talent at a dealership level, especially for ICE vehicles, I mean, good God, man. can only imagine how difficult that is.
Chris J. Martinez: Yes, it's it's it's insane. And then now they have even the techs having you you know the the VR headsets just to try to diagnose and pinpoint some of these things and you're just like, Yeah, no, I get it. You know, it's it's They have live YouTube video on their face and like looking at the schematics of the vehicle and saying, Okay, that's where that issue is and that's kind of interesting. But
Zach Fritz: Yeah. Yeah. A lot less broken clips, which is a good thing.
Chris J. Martinez: Yes, a hundred percent. Cause you know what how how much those things can cost. But one ⁓ here's another kind of another headline that I wanted to get into before we walked into some of what the former president ⁓ of said. But there's a interest this is ⁓ one that's been getting a lot of attention online, specifically on on social media. And so ⁓ Dennis Walsh from Lot Law.
Chris J. Martinez: He gave a a candid take Delivered, the Tommy ⁓ from Delivered. He has brokering service, former automotive professional.
Chris J. Martinez: turned broker, started, you know, going online, recording his live negotiations with dealers, showing how bad some of these dealers are. and some of ⁓ it's actually quite embarrassing to see some of these these dealers and how they're, you know, the games they play.
And and I get it. I understand, you know, why some of these people might, you know, not wanna that information and I think it's interesting that he charges people a thousand dollars just to go in there and negotiate.
And, know, there are those dealers that are gonna take those deals because hey, they need to hit an objective and take the stair stare step money is out there. But Dennis basically argument was look, look, some of brokers are accidentally operating like unlicensed dealers.
So Dennis is a twenty-three year automotive veteran, but he's an attorney. And was about North Carolina broker laws specifically because ⁓ that's where Tommy from Delivered works out of and his core argument is North Carolina's statute doesn't just focus on where the buyer or vehicle is located, it focuses on the conduct.
Chris J. Martinez: So if someone is negotiating deals, collecting fees, arranging vehicle sales, working dealer communications, operating from inside the state, then that could argue that business activity itself is ⁓ is occurring there, even if the buyer and dealer are outside out of the state.
So then he says, According to the discussion, Carolina General Statute 20 306 may make arranging new vehicle sales for for a fee unlawful unless you're a licensed franchise dealer, distributor, rep, or actual owner of the vehicle.
So there's a no five car runway there. This is where things are interesting as more brokers marketplaces. They ⁓ so it's it's interesting to say that because they're negotiating doing that. The laws are speci are specific in North Carolina stating that if you're doing that, then you need to be a licensed dealer.
So I you know, I wonder if, you know, this is from an attorney that looked up the laws Tommy from Delivered Works out of. And so I if that, you know, and I and maybe, ⁓ you Tommy ⁓ had talked to an attorney.
Who knows? I don't know how. ⁓ They work out there, but it it's interesting. I'd I'd love to hear what Tommy has to say on that. and ⁓ does he need to go get a dealer license just to be a broker? I know.
Zach Fritz: So interesting to me, right? So I have my independent YouTube channel, and we have a lot of crossover audience, and it's to see the amount of comments I get that's like, hey, you should partner up with Tommy, you'll, you know, we have a lot in common.
But I was of watching this play out a little bit, and I recently watched an entire, I think it was some big news outlet that did a whole breakdown and interview of what Delivered is doing. And it's a really impressive model.
My only or thought here, in reference to what this attorney has said, is my understanding, Delivered has multiple people working underneath their umbrella and negotiating these deals. It's not just Tommy.
So would then it apply to where those quote unquote, I don't want to say brokers, but it kind of is, deal workers, negotiators are based out of themselves and working remotely. Or would this apply to wherever the company is based?
Chris J. Martinez: It's gonna be yeah, I mean, every state has di separate laws, then there's the whole national laws and you know, I don't know, but then you think about Car Edge that th you know, they
Chris J. Martinez: also tell you, hey, look, I'll we'll have our AI broker the deal for you and it's thirty dollars or fifty dollars, whatever they charge. you know, I don't know, do are they in the same position because now they're operating out of multiple states or where is it's where they're actually located and doing those negotiations.
I it's it's an interesting topic and and really there's there's three different types of b brokers in my mind. So the one there's those illegal brokers that are definitely out of out of you know, out of the country trying to get these new cars and, you know, ship them overseas, get around taxes, tariffs, and all that, right?
There's those. Those ones, they're real sneaky. They try to figure out ways to, you know, you know, tell the dealer that they're legit. And, you know, even after, know, all kinds of t checks, they still come out, you know, six months later that, hey yeah, that was a a broker.
Chris J. Martinez: ⁓ there's that one. Then there's the fleet tail guys that they're enterprise dealers or enterprise stores that go and say, Hey, I need to buy 20 cars. And those are hitting these big objectives, and so they they they don't mind selling them, you know, 20, 30 cars or fleet tailing them a month.
and then there's these ones that there's a reason why they're there is because dealers just aren't the easiest sometimes to do business with because they don't wanna give you pricing over the phone or best you know, best pricing the the they know they can haggle and it's a couple hundred bucks off or whatever it is.
So I don't know. I think the broker there's there's a reason why they they they exist, but then ⁓ the are there to protect the dealer. so I'm sure. What do you think?
Zach Fritz: If you look at it in the macro, I do have a strong opinion on this. Now, look, I think that consumers in general, we should always strive to do a better job of educating ourselves and learning how to negotiate and get a better deal.
Along those same lines, I do feel like the more prevalent that AI becomes, the more prevalent brokers become, the more prevalent we see this mass kind of Dispersal what deals look like in certain parts of the country and start to try to apply them to our local regions, we are starting to see kind of the art of the deal, if you will, erode.
We're starting to see deals where somebody's like, hey, yeah, I got X amount of dollars off of this new purchase. That's starting to go away because of all this transparency. Now, whether that's good or bad, I personally don't know.
But I think that we're starting to move towards a situation in which cars are just gonna cost what they cost. Because everybody thinks that, ⁓ well, this deal in North Carolina should also apply to a car in Southern California, when usually the car in North Carolina is a whole hell of a lot cheaper than the car in Southern California, just due to the fact that it's in California.
But if we see people start to expect these prices across the country that traditionally They don't get, well, where's the deals to be had? We're gonna stop seeing that.
Chris J. Martinez: Yeah, you know, it's it's it it is interesting because when I think about the rest of the world, right? The rest of the world they negotiate, that's just, you know, how it is. But the United States, you know, we've just been accustomed to just going in there and just, you know, paying full pop and, you know, on all these different places. But then when it comes to automotive, you know, we've just heard so many the consumer has heard so many bad things.
Chris J. Martinez: And I don't e i it's weird because there's been a lot of crazy things that you the stories you hear, right? and what what's funny is w I remember one before I got into the business, and this was I must have been eighteen, nineteen years old, and I remember a a friend of mine telling me I look like a used like a used car salesman because I had, you know, my hair slicked back and had my cell phone and And I go, man, and I kinda c cussed them out and I said, like, yeah, don't be comparing me.
Now if someone said that, I'm like, man, thank you. No, I appreciate that. You know, I I'm you know, I love my this this work this career path that I've gone down. But let's face it, we do have a bad ⁓ like automotive isn't the best, just like attorneys, they they everyone, ⁓ know, has something to say.
Chris J. Martinez: And, know, I don't know that the broker goes away and I think with these new people coming out, I think there's there's you know, the dealer's not gonna sit there and, you know, they're gonna try to I ⁓ you enforce some of the you know, their teams with attorneys and things like that, but I don't know who's gonna be the first to move.
Zach Fritz: My only issue that I have with what Delivered is doing is essentially they are taking, know, probably not all the deals they're doing, let's face it, but a majority of the deals and they're putting this out to the masses.
At what point, again, when there's no deals to be had because there's this mass transparency, at what point does it do this delivered basically eliminate? Broker. Same thing with what CarEdge is doing.
At what point do they show so many deals and create so many transparent dealerships? they then basically eliminate their value, right? Whether it be a thousand dollars a car, whether it be a certain monthly charge like CarEdge has, do they just become completely irrelevant?
You know, maybe it's a generation or two, but they are working towards obsolescence with the service that they provide.
Chris J. Martinez: Yeah. No, I think think it's gonna be ⁓ a pretty time with with now with AI and the things that people just access to. I mean information today. So w ⁓ we'll it's be you know, that whole hey, I didn't know argument y at point the amount of information there is, I mean those those kind of things, you know, maybe five years down the road they they may not be have an opportunity to have brokers or things like that because there's just everything is now s even more transparent than what it was that there's no no need for ⁓ So I don't know.
I don't know. Is this a is this a short term thing that they've got their, you know, fifteen minutes of fame and then
Chris J. Martinez: two years down the road that they're no longer because AI is just at a different level that you know you know think about Rivian direct to consumer scout direct to consumer is there a whole different model or ⁓ know format that we're gonna live in that everybody just pays one price? I don't know.
Zach Fritz: I think so. Yeah, it kind of follows the the line of right, like you you give away the secrets, right, and then you sell the implementation. Well, I think they they need to decide, are they a content creation company and that's how they're going to monetize, and show everybody what they're doing behind the scenes, or are they going to negotiate behind the scenes and continue to draw in uneducated consumers who find the value in that?
Because when everybody's educated, there is no value to being a broker anymore or charging if anybody can go out and do that on their own.
Chris J. Martinez: Well, th but then there are those people that just don't wanna like educate themselves, don't wanna use new technology. So then there's that percentage of people that are still maybe in that that place in life that they just, you know, wanna claim ignorance. I don't know. Well ⁓
Chris J. Martinez: Here's here's something that you could kinda speaking of I don't know if we want to say ignorance ⁓ or this is specifically. but think when you think about Ferrari, I mean Ferrari, I remember as a kid, you look at these the red Ferrari or you know, you got Miami Vice, you got all these people, like the posters, the wall art.
Like this is your vision board, the the Ferrari or even the Lamborghini, right? Lamborghini was always mine, but the Ferrari was always like right there. ⁓ and so the previous of Ferrari, his name is gosh, I'm gonna mess this up.
So let me let me see if I can just read really quickly. Like it's
Chris J. Martinez: When I when I read this or I saw it was a video, they had interviewed him. They were interviewing him. His name is Cordero de Montezamallo. and he his quote, in some some guys interviewing.
This is in Italian, so I wish I could read it in Italian. 'cause it would sound even like you're just listening to the guy and you're like, man, this guy you you could tell the dis dis like. Disgust in his voice, right?
The way he was talking about it. But he said, Look, if I said what I really think, he prefaced it that way, and then he said what he really thought. He said, would hurt Ferrari. We risk destroying a myth.
I'm very sorry about it. I hope they at least remove the prancing horse from the car. And then they asked him, Well, what should ⁓ we do with China? And then he said, At least this is one car the Chinese won't copy.
Zach Fritz: I have a lot to say here. I say disappointment is universal across every single language. That's a fact. You can hear it. And I think that this is one where it really is gonna shine through, especially with the Ferrari brand.
Now, Ferrari, I don't know what has been up their butt over the last decade, but it's not great. And the entire car community feels this way, whether it be Ferrari going after Influencers and people for modifying their cars.
That's ridiculous. I mean, people are bringing more clout to your brand, so it's never a bad thing. To Ferrari coming out with this new EV concept, or did you see the Puro Sangue that matched the Mazda a few years back?
They're think they've completely lost focus on what the brand used to stand for. And a highlight here, based off what Luca said, is It's a myth. And I think he means that in terms of Ferrari being this thing that people always strive for, they always wanted.
It was this car, this aspiration for most people, having the Lamborghini poster or the Ferrari poster on their wall as a child. And they've lost that. And I completely agree that the Chinese are not going to come out and copy this car because it looks like crap.
Chris J. Martinez: Well, here's the thing. If it didn't have the name Ferrari on it, you probably would have thought it was a cool cart. Like if say if it had Saturn you know, Pontiac, a Kia. And Kia, I mean some of the Kias look cool, but
Chris J. Martinez: You look at this and you're just thinking, man, this is not Ferrari. And I think that's really what most people look at. It's not that it's that ugly, but it's just 'cause it has the name Ferrari on it that you're like, that's not what I thought. When I think of Ferrari, I think of, you know, car, luxury, beautiful looking car.
Chris J. Martinez: That was not it. I think it it it's looks nice. and I'm I'm one of talk, right? I have the Cybertruck and that's to me I I like it because it's got that rugged like you know, ⁓ Batmobile, I wrapped it in a the black mat. So it it feels like that Batmobile, the dark night type of deal. But anyways, that Ferrari just look like a Ferrari. I I I'm I
Chris J. Martinez: You know, it's funny because I I I I posted on LinkedIn about it one of the the people, the comments was, Hey, look, first of all, nobody liked it. 'Cause I said, Well, there's the it's divided.
And they're like, No, no, no, there's no division here. Like nobody liked it. And and what's interesting is the the Lamborghini CEO, Steven told N B C He said on the automaker's decision to kill its all electrical vehicle.
he said that after seeing this backlash from Ferrari, he said it was the right way to go. So and that's when from the CEO of Lamborghini. And so you know they they were wise to to cancel that. I think that, you know, all these other companies, really should look and look at what happened with Mercedes, you know, Mercedes had to cancel the whole thing because it just wasn't profitable.
It they, you know, the dealers lost a ton of money. They didn't look like a Mercedes. And I think that was the biggest pushback even from the consumer that I heard. they did I mean I I thought they looked nice, but it just didn't look like a Mercedes, right?
Like you you saw that EQS super fast, beautiful interior. Their interior was second to none.
Chris J. Martinez: the exterior was less than a the allure of a Mercedes, right? So you would have thought Ferrari seen the the backlash there would have just put the brakes on the on their E V, but they went they kept going and it just wasn't the right roof.
Zach Fritz: You know, I've I've heard it phrased a few different ways. I've heard that this is Ferrari's Bud Light moment, which we'll keep the podcast clean here, but Bud Light did lose their brand identity for most of their consumers whenever that happened.
And I feel like Ferrari is doing the exact same thing here, where it's just like Mercedes. If Mercedes had come out and said, hey, we're gonna stick to our brand identity, we're gonna make something with Gol Wing Doors, right?
Bring back the nostalgia. We're gonna make it EV. We're gonna pump it out at an affordable price. It would have been successful. But instead, they want to go too far off the beaten path and pretend that there's something they're not.
Ferrari is not a brand that has the customer base to support them in a mass vehicle market. And especially if you look at the price that they want to charge for this EV, many Teslas could you buy for that?
Chris J. Martinez: It was terrible, sir. Six hundred and fifty thousand dollars. I mean that's the price tag. That's probably the r and then you look at the wheels. The wheels were just disgusting. They're I I was looking at it and I was just like, What were they thinking? Like it Yeah, and but it ⁓ but it
Zach Fritz: It's it's as if a DeLorean in a Dyson vacuum had a baby.
Chris J. Martinez: It's funny because if you think about what they built, take the emblem off. It actually might have been a cool car. But because it has that Ferrari, it just doesn't it it just kills the the the the whole look, know? That's how much of a an a brand that Ferrari has that change you just put that look on it, you're like, ⁓ that's not a Ferrari. But one of the the comments from
Chris J. Martinez: from LinkedIn was from a gentleman he talked we I I had said look have you seen Hamilton's review and at Hamilton you know as you know F1 race car driver I guys want broke all kinds of or won all kinds of medals and stuff ⁓ or trophies ⁓ and if listen to what he said he said yeah it was a nice key yeah I really the key he didn't talk about
Chris J. Martinez: you know, performance or styling, the look. fact that they even have a key was kinda just crazy to me. I mean, my Tesla I don't even need my key. I just walk to open the door, it's tied to my phone and let's move on. Like they actually had to have a key that you push in and it illuminates and I don't know, sir. It's ⁓ was disappointing to say the least. Yeah.
Zach Fritz: Yeah. Yeah. It's look at the price. That's my big thing is the price. For the price of that car, what is it? Six fifty?
Chris J. Martinez: Six hundred and fifty thousand.
Zach Fritz: I would buy a four hundred thirty scuderia. I would then go buy a Tesla for my EV, and then the rest, I'd go throw in USO stocks. I mean I just the rationale here makes sense. Who's gonna go spend six hundred and fifty thousand on a what EV Ferrari that looks ⁓ a DeLorean in a Dyson vacuum had a twisted love child? It's it's terrible.
Chris J. Martinez: Well look, I bet you it's fast because look, it's got a thousand thirty-five horsepower. That's pretty insane. Quad motor, all wheel drive setup, zero to sixty-two. don't even say zero to sixty, they say zero to sixty-two in two point five seconds. So that's fast. has about three hundred and thirty miles of range.
Chris J. Martinez: four wheel steering, torque vectoring, Ferrari developed drivetrain and battery architecture. So this is where the the the story was. And I saw it first on X and IV, which the who created the Apple, designed all the Apple products.
He he had he the also the the was influenced the design and interior direction. And if you look at the interior, they have a small little screen that looks like a small iPad. you would have thought they could have done it more futuristic.
Like, think about the the design Mercedes did. That whole dash screen, amazing. Like it's to me that that whole hyper screen that they have makes the EV ⁓ and for Mercedes. And then you look at Ferrari and it's just was a like a Kia look in the interior.
Like, I don't know. I the leather was probably super expensive. Probably was ⁓ you know, Chanel or Herma's leather and you know, I don't know. What do you think?
Zach Fritz: I mean, look at the new Mercedes, the what is it, the GT four door EV coupe that they just launched. It's eleven hundred horsepower, two point five seconds, zero to six. I mean, same specs, a fraction of the cost, and it looks far better. I mean everything that Ferrari launched with this car is irrelevant and already past date, but I guess that fits the Ferrari brand and what they've done for the past twenty years.
Chris J. Martinez: Yeah. Yeah, so who knows? They lost a lot of market share in their in their stock yesterday. And so who knows what's gonna happen of But I think that's ⁓ a good way to wrap it up. Zach, as always, let's ⁓ do some closing statements and and let's let's tighten it up here. What do you think?
Zach Fritz: Yeah. Well the robots are coming for everybody's jobs. There's nothing we can do about it. even Ferrari has slipped and world is ending.
Chris J. Martinez: The I think the future looks bright. I I truly believe we're in a whole new that you know I'm I'm gonna s I'm following closely what Lithia's doing because if w there's a new, better, easier way to implement certain things to help improve dealership operations and improve profitability, I'm all for it. what group one's doing, I'm I'm I'm gonna be following close
Chris J. Martinez: closely too. I think a lot of these companies are moving towards something like ⁓ what CarMax started, you know, long time ago and they're barely seems like they're kinda catching up at this point. ⁓ but we'll see. I think ⁓ it's gonna we're in interesting times with, you know, the robots and we'll I'm curious to see what if this guy keeps his job after you know deploying this E V 'cause you know what happened to the last guy who did the the Jaguar thing.
Chris J. Martinez: didn't make it after shortly after that. So we'll see. ⁓ I'm see what that looks like.
Zach Fritz: I think the perfect way to tie this up is don't ever go full Jaguar.
Chris J. Martinez: Even though the car the car looks nice, sir. I think it looks it looks good. I there's you know, but I know, I know exactly what you mean, sir. So don't go full full Jaguar, I guess. that's from a movie. I know that movie too. That's a really good movie. I don't know that we ever see a movie like that again. ⁓ it it was a great movie. But as always, Zach, it's great, great ⁓ talking with you. ⁓ And until next week, I'm sure we'll have
Chris J. Martinez: even more exciting headlines and and we'll give the audience our our honest take and our breakdown. So until next week. Thank you. Talk to you soon. Take care. Bye.
About this episode
Dealerships are cutting roles as AI and “virtual” workflows reshape auto retail—especially in F&I, where deal-scanning is being centralized and remote signing tools like Docupad help streamline paperwork. The hosts also weigh how combining sales and finance roles could change back-end profitability, and how service experiences may shift toward kiosks, AI “virtual advisors,” and even diagnosis-only steps. They pivot to broker licensing questions under North Carolina law and debate whether transparency will erode the broker’s “art of the deal.”
The conversation covers various automotive industry headlines, including job cuts, virtual F&I, dealership restructuring, and the impact of technology on the industry. It also delves into the role of AI, the future of automotive technicians, and the emergence of automotive brokers. The conversation covers a range of topics including the impact of AI and brokers on the automotive industry, the evolution of car pricing and negotiation, and the controversy surrounding Ferrari's new EV model. The discussion also delves into the future of dealership operations and the influence of technology on the automotive market.
Takeaways
Job cuts and dealership restructuring are indicative of a larger shift in the industry.
The integration of technology, AI, and virtual F&I is simplifying processes and reducing friction for customers. AI and brokers are reshaping the automotive industry
The future of car pricing and negotiation is evolving with the rise of transparency and technology
