"The Lost Generation of CapEx" – How Dealers Can Win in a Commoditized Car Market | Michael Maroone, Chairman and CEO of Maroone USA.

New vehicle margins refer to the profit dealers make on the sale of brand-new cars. These margins have been shrinking due to increased competition, manufacturer pricing strategies, and market conditions.

Total deal economics refers to the overall profitability of a vehicle sale, including new and used car sales, financing, add-ons, and service contracts. Dealers analyze this to maximize their profits beyond just the sticker price.

Nimble private groups are smaller, privately owned dealership groups that can adapt quickly to market changes compared to larger public operators.

Public scale operators are large dealership groups that are publicly traded companies. They often have different strategies and resources compared to smaller, privately owned dealer groups.

A non-compete is a legal agreement that restricts an individual from working in the same industry or with competitors for a specified period after leaving a job.

CarMax is a large used car retailer in the United States known for its no-haggle pricing and large inventory of used vehicles.

AutoNation is one of the largest automotive retailers in the United States, operating numerous new and used car dealerships across many brands.

Tesla is an American electric vehicle and clean energy company known for its innovative electric cars and autonomous driving technology.

Carvana is an online used car retailer that allows customers to buy, finance, and trade in cars entirely online, with home delivery options.

OEM stands for Original Equipment Manufacturer, referring to companies that produce parts or vehicles that are sold under another brand or in partnership with other manufacturers.

The dealership model refers to the traditional system where car manufacturers sell vehicles through independently owned or franchised dealerships rather than directly to consumers. This model involves dealerships handling sales, financing, and service for customers.

New vehicle dealership franchises are authorized businesses that sell new cars from specific manufacturers. They operate under agreements with automakers to represent their brand and handle sales, service, and warranty work.

Direct to consumer refers to selling products, like cars, directly from the manufacturer to the buyer without intermediaries such as dealerships. This model can disrupt traditional dealership sales.

Online auto retailers are businesses that sell cars through internet platforms rather than physical dealerships. They often offer a more streamlined buying process and home delivery options.

The new car business refers to the industry segment involved in the manufacturing, marketing, and selling of brand-new vehicles to consumers.

The new car market refers to the industry and environment surrounding the sale and purchase of brand-new vehicles from manufacturers or dealerships.

Commoditized means that products have become very similar and interchangeable, often leading to price-based competition rather than differentiation by features or quality.

Dealer fees are additional charges added by car dealerships on top of the vehicle's price, often covering administrative costs, documentation, and other services. These fees can significantly increase the out-the-door price but may not always correspond to added value for the buyer.

F and I stands for Finance and Insurance, a department in car dealerships responsible for arranging financing, selling insurance products, and extended warranties. It is a major profit center for dealerships beyond the vehicle sale itself.

Parts and service refer to the maintenance, repairs, and replacement components sold by dealerships and repair shops. This area often generates significant profit for dealerships compared to new car sales.

Trades refer to trade-in vehicles that customers offer as partial payment towards a new vehicle purchase. Dealers often profit by reselling these used cars.

A lost leader is a product sold at a low price, often at break-even or a loss, to attract customers with the goal of making profits on other services or products.

New vehicle inventory refers to the stock of new cars that dealerships have available for sale. Managing this inventory efficiently is crucial for dealerships to maintain profitability and meet customer demand.

Catback refers to an aftermarket exhaust system that replaces the piping from the catalytic converter back to the muffler and exhaust tip, often improving performance and sound.

Commoditization in the automotive industry refers to the process where products become indistinguishable from each other, leading to competition mainly on price rather than features or innovation.

Hybrid technology combines an internal combustion engine with an electric motor to improve fuel efficiency and reduce emissions compared to traditional gasoline-only vehicles.

EV stands for electric vehicle, which runs entirely on electricity stored in batteries and produces zero tailpipe emissions.

Carfax is a company that provides vehicle history reports and data to help buyers and dealers understand a car's past, including accidents, ownership, and service records.

A trade-in is when a customer offers their current vehicle as partial payment toward the purchase of another vehicle, usually at a dealership. The value of the trade-in is deducted from the price of the new or used car being bought.

Used vehicle margins refer to the profit dealerships make on selling used cars, which tend to be lower per unit compared to new cars but can be supplemented by other fees and services.

Reconditioning money refers to the expenses dealerships spend to prepare used vehicles for sale, including cleaning, repairs, and maintenance.

A process engineer is someone who designs, analyzes, and improves business processes to increase efficiency and effectiveness, often applying systematic methods and technology.

Dealership framework agreements are contracts between dealerships and manufacturers or other parties that outline terms and conditions for vehicle sales and operations. They help provide certainty and structure for buyers and sellers during transactions.