Perdikis on Gov. Shutdown, Wood on Recent Buy Sell, Huff on Used Philosophy | Daily Dealer Live
About this episode
C.M. Dark hosts a lively discussion on the current state of the automotive industry, featuring insights from Alex Perdicas on navigating the government shutdown's impact on sales, and Michael Wood on improving dealership performance. The episode highlights Lithia Motors' recent acquisitions, the challenges in the used car market, and strategies for managing subprime financing. Nick Huff shares his approach to sourcing used cars and the importance of maintaining strong relationships with customers. The conversation emphasizes community engagement and adapting to market changes, making it a valuable listen for industry professionals.
Lithia Motors
"...Lithia Motors is back in the headlines after acquiring Porsche, Beverly Hills and Audi Santa..."
Lithia Motors is a big company that owns many car dealerships in the U.S., selling different car brands.
Lithia Motors is one of the largest automotive retailers in the United States, operating numerous dealerships across various brands. They focus on acquiring and managing dealerships to increase their market presence.
Porsche
"...Lithia Motors is back in the headlines after acquiring Porsche, Beverly Hills and Audi Santa..."
Porsche is a famous car company from Germany that makes fast and luxurious cars, like the 911 sports car.
Porsche is a renowned German automobile manufacturer known for its high-performance sports cars, SUVs, and sedans. The brand is famous for models like the Porsche 911 and Cayenne.
Audi
"...acquiring Porsche, Beverly Hills and Audi Santa..."
Audi is another well-known car brand from Germany that makes luxury cars, known for their quality and technology.
Audi is a German automobile manufacturer that is part of the Volkswagen Group. Known for its luxury vehicles, Audi combines performance with advanced technology and design.
Hyundai
"Automotive has picked up right-way Hyundai in Jamesboro, Virginia from Mark Wright. The newly renamed Williamsboro Hyundai continues Fred Timbrook Jr.'s steady expansion along the eastern seaboard."
Hyundai is a car company from South Korea that makes many types of vehicles, including sedans and SUVs. They are known for making affordable and reliable cars.
Hyundai is a South Korean automotive manufacturer known for producing a wide range of vehicles, from compact cars to SUVs. The brand has gained popularity for its value, reliability, and warranty offerings.
Mazda
"...expansion along the eastern seaboard. Timbrook has now grown to 20 dealerships adding several Hyundai, Mazda and Chevy stores in the past year alone."
Mazda is another car company from Japan that makes cars known for being fun to drive. They have a reputation for stylish designs and good performance.
Mazda is a Japanese automaker recognized for its innovative engineering and sporty vehicles. The brand is particularly known for its use of the rotary engine and its focus on driving dynamics.
Chevrolet
"...expansion along the eastern seaboard. Timbrook has now grown to 20 dealerships adding several Hyundai, Mazda and Chevy stores in the past year alone."
Chevrolet, or Chevy, is a well-known car brand in the United States that makes many types of vehicles, including trucks and sports cars. They are famous for models like the Corvette and Silverado.
Chevrolet, often referred to as Chevy, is an American automobile brand known for a wide range of vehicles, including trucks, SUVs, and sports cars. It is a subsidiary of General Motors and has a long history in the automotive industry.
average transaction price
"According to Edmunds, the average transaction price for three-year-old vehicles hit $31,067 in Q3."
The average transaction price is the usual price people pay for cars after they negotiate. It helps show how much people are spending on cars these days.
The average transaction price refers to the typical amount paid by consumers for vehicles after negotiations and discounts. It serves as a key indicator of market trends and consumer spending in the automotive industry.
federal tax credit
"But EVs were the exception ahead of the federal tax credit cutoff. They sold faster than any other segment averaging just 34 days on lot."
The federal tax credit is money the government gives back to you when you buy an electric car. It helps lower the price you pay for the car.
The federal tax credit for electric vehicles (EVs) is a financial incentive provided by the government to encourage the purchase of EVs. This credit can significantly reduce the overall cost of the vehicle for buyers, making it more affordable.
subprime loans
"...but Cox says lenders offset that by writing more subprime loans, stretching loan terms past 72 months and allowing smaller down payments."
Subprime loans are loans given to people who might have trouble paying them back because of bad credit. They usually have higher interest rates because of this risk.
Subprime loans are offered to borrowers with lower credit scores, indicating a higher risk of default. These loans typically come with higher interest rates to compensate for the increased risk.
upside down on a loan
"...when many of these customers return to the dealership in a more precarious financial position, a.k.a. upside down on that 72 or Heaven Help Us 84-month loan."
If you're 'upside down' on a loan, it means you owe more money than your car is worth. This can make it hard to sell or trade in your car without losing money.
Being 'upside down' on a loan means that the borrower owes more on the loan than the asset is currently worth. This situation can lead to financial difficulties, especially when trying to sell or trade in the vehicle.
Subaru
"Finally, up today, Subaru is tapping the brakes on its EV plans. The automaker says it's retooling..."
Subaru is a car company from Japan that makes vehicles known for being safe and good for driving in tough weather conditions.
Subaru is a Japanese automaker known for its all-wheel-drive vehicles and a strong reputation for safety and reliability. They have a loyal customer base, particularly among outdoor enthusiasts.
EV
"Finally, up today, Subaru is tapping the brakes on its EV plans. The automaker says it's retooling..."
An EV, or electric vehicle, is a car that runs on electricity instead of gas. They are better for the environment and can save you money on fuel.
EV stands for electric vehicle, which is a type of vehicle that is powered entirely by electricity rather than gasoline or diesel. EVs are known for being environmentally friendly and often have lower operating costs.
hybrids
"...what customers actually want right now, which is more hybrids and fuel-efficient gas models."
Hybrids are cars that use both gas and electricity to run. This helps them use less fuel and produce fewer emissions than regular cars.
Hybrids are vehicles that use both an internal combustion engine and an electric motor to improve fuel efficiency and reduce emissions. They can run on either or both power sources, depending on driving conditions.
Lincoln
"...anybody that owns a Ford Lincoln or Mazda, and it does not have to be purchased from any, any of the Coons Motors dealerships. Okay. So anybody in the DMV that owns a Ford Lincoln or Mazda, that it was..."
Lincoln is a luxury car brand that is part of Ford. They make high-end cars that focus on comfort and style, similar to brands like Lexus or BMW.
Lincoln is the luxury vehicle division of Ford Motor Company, known for producing premium sedans and SUVs. The brand emphasizes comfort, technology, and upscale features.
Ford
"...anybody that owns a Ford Lincoln or Mazda, and it does not have to be purchased from any, any of the Coons Motors dealerships. Okay. So anybody in the DMV that owns a Ford Lincoln or Mazda, that it was..."
Ford is a well-known car company that makes many types of vehicles, like trucks and cars. They have been around for a long time and are famous for making the first cars that were affordable for many people.
Ford is a major American automotive manufacturer known for producing a wide range of vehicles, including cars, trucks, and SUVs. Founded by Henry Ford in 1903, the company is famous for its innovative assembly line production techniques.
tire rotation
"...free and home old change, right? That's straightforward. And obviously comes with tire rotation and so forth as well..."
Tire rotation means changing the position of your car's tires so they wear evenly and last longer.
Tire rotation is the practice of moving tires from one position on a vehicle to another to ensure even wear and extend their lifespan.
transmission
"...they got their car in for service, and they're staring at a $6,000 transmission bill. And, you know, they got to make a decision..."
The transmission is like the part of the car that helps it change gears and move. It connects the engine to the wheels, making sure the car can drive smoothly.
The transmission is a crucial component in a vehicle that transfers power from the engine to the wheels, allowing the car to move. It can be either automatic or manual, affecting how the vehicle operates and performs.
Stellantis
"...we're also a volume Stellantis dealer. So we are put into that play of the..."
Stellantis is a large car company that makes many different brands of vehicles. It was created when two big car companies joined together.
Stellantis is a multinational automotive manufacturing corporation formed from the merger of Fiat Chrysler Automobiles and PSA Group. It encompasses a variety of well-known automotive brands, including Jeep, Dodge, Chrysler, and Peugeot.
stair step program
"...For everybody who's not familiar with the stair step program, in particular Stalantis, tell us what it is."
A stair step program is a way for car manufacturers to reward dealers for selling more cars. The more cars they sell, the bigger the bonuses they can earn, similar to climbing stairs.
A stair step program is an incentive structure used by automakers to encourage dealerships to sell more vehicles. Dealers earn bonuses based on the number of cars sold, with increasing rewards at different sales thresholds, hence the term 'stair step.'
subprime customers
"...those subprime customers you keep for life. Let's get into, you know, a little bit of the how..."
Subprime customers are people who have lower credit scores, making it harder for them to get loans. Car dealerships often work with these customers to help them buy cars and keep them as long-term clients.
Subprime customers are individuals with lower credit scores who may have difficulty securing traditional financing for a vehicle. Dealerships often target this demographic to sell cars, as they can build long-term relationships with these customers.
trade-ins
"...we're sourcing a lot from our trade-ins, our new car department, which is our favorite way..."
Trade-ins happen when someone gives their old car to a dealership to help pay for a new one. This helps the dealership get more used cars to sell.
Trade-ins refer to the practice of customers exchanging their old vehicles as part of the payment for a new or used car. This is a common way for dealerships to acquire used inventory.
street purchase
"...we're also very aggressive from what we call a street purchase, you know, acquisition front..."
Street purchases are when dealerships buy cars directly from people in the community who want to sell them. This helps the dealership get more cars to sell.
Street purchases involve acquiring vehicles directly from individuals in the community who want to sell their cars. This method allows dealerships to expand their inventory without relying solely on trade-ins or auctions.
flat commission
"Well, in summary, it's just a flat commission we pay per car they buy. And we recently changed it."
A flat commission means that salespeople earn a set amount of money for each car they buy, no matter how much the car costs. This encourages them to buy more cars quickly.
A flat commission is a fixed amount paid to sales staff for each sale they make, regardless of the sale price. This incentivizes salespeople to acquire more cars quickly, as their earnings are directly tied to the number of transactions they complete.
$10,000 to $20,000 cars
"which for our area is, you know, 10,000 to 20,000 dollar cars. And for those cars, just to throw a number out there..."
$10,000 to $20,000 cars are vehicles that cost between ten and twenty thousand dollars. These are usually more affordable options for many buyers.
This price range refers to the typical market value of the cars being acquired by the sales staff. Cars in this range are often considered affordable and appealing to a wide range of buyers, making them easier to sell quickly.
synergy between departments
"...what are you doing to maintain synergy between these departments? Well, we have a good person in place that manages our reconditioning for the majority of our pre-owned cars..."
Synergy means working together effectively. Here, it means the used car department and the service department are cooperating to do their jobs better, which helps the dealership run smoothly.
Synergy between departments refers to the collaborative interaction between different areas of a business, in this case, the used car and service departments. This collaboration can enhance efficiency and improve the overall performance of the dealership.
reconditioning
"...manages our reconditioning for the majority of our pre-owned cars. And again, he's just like our other managers..."
Reconditioning is fixing up used cars so they look and work better before selling them. It includes cleaning and making any necessary repairs.
Reconditioning refers to the process of repairing and refurbishing used cars to bring them up to a saleable condition. This can include mechanical repairs, cleaning, and cosmetic touch-ups to enhance the vehicle's appeal.
Nissan
"so in some of those OEMs that do stair step. So Stellantis, Hyundai, Nissan, some of those,"
Nissan is a car company from Japan that makes a variety of vehicles, including electric cars and popular sedans.
Nissan is a Japanese automotive manufacturer known for its diverse lineup, including electric vehicles like the Leaf and popular models like the Altima and Rogue.
Carvana
"... How do you deal with CarMax and Carvana offers that walk into your store? ..."
Carvana is a company that lets you buy and sell used cars online, often delivering them right to your home.
Carvana is an online used car retailer that allows customers to buy, sell, and trade cars through a digital platform, often featuring home delivery.
CarMax
"... How do you deal with CarMax and Carvana offers that walk into your store? ..."
CarMax is a company that sells used cars at set prices, making it easier for people to buy without negotiating.
CarMax is a used car retailer known for its no-haggle pricing and large inventory of vehicles. It simplifies the car buying process by offering fixed prices.
Infiniti
"...it was Mercedes Benz. It was Infinity. It was JLR, Jag Land Rover,..."
Infiniti is a luxury car brand that comes from Nissan. They make high-end cars that are designed for comfort and style.
Infiniti is the luxury vehicle division of the Japanese automaker Nissan. It offers a range of premium sedans and SUVs that focus on performance and comfort.
Jaguar Land Rover
"...It was Infinity. It was JLR, Jag Land Rover,..."
Jaguar Land Rover is a company that makes luxury cars. Jaguar is known for sporty cars, while Land Rover makes tough, off-road vehicles.
Jaguar Land Rover is a British automotive company that produces luxury vehicles under the Jaguar and Land Rover brands. They are known for their stylish designs and off-road capabilities.
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