Ram trucks are big pickup trucks made by a company called Stellantis. The company lost a lot of money recently, which might be making it hard for them to keep making or selling these trucks easily.
The Jeep Grand Cherokee is a big SUV that many people like because it can drive on rough roads and is comfortable inside. Right now, there are a lot of these cars sitting unsold for a long time, which means dealers are having trouble selling them.
The Jeep Wagoneer is a big, fancy SUV. The new 2025 version is electric, meaning it runs on batteries instead of gas, and Jeep is trying it out to see if people like it.
"Days on the market" means how many days a car has been for sale. If it's been a long time, it might mean not many people want it or the price is too high.
"Dealer desperation" means the car sellers really want to sell their cars because they have too many and not enough buyers. This can help you get a better deal.
The Ford Edge is a medium-sized SUV that many people buy for everyday use. Ford is charging extra money for a certain window feature, which means you have to pay more to get it.
A hybrid car uses both gas and electricity to help it go farther without using as much fuel. The hybrid trim means that version of the car has this technology.
The Subaru Forester is a small SUV that can drive on all types of roads and weather. It's popular for families and people who want a reliable car that can handle snow or rain.
The Toyota RAV4 is a small SUV that many people buy because it's reliable and easy to drive. It competes with other similar cars, and how much it costs can make a big difference to buyers.
The Toyota Camry is a popular car that many people trust because it lasts a long time. Toyota has tried charging for extra features or power upgrades in new ways, which has caused some problems.
The Ford Mustang Mach-E is an electric car that looks sporty and has a storage space under the hood called a frunk. Ford is charging extra money for this storage space, which some people find surprising because it used to be free.
LIVE
It's noon here in Ventner City, New Jersey, and our nation's capital, Washington, D.C.,
and this is Courage Live for Thursday, February 26th. Oh my goodness, only two days left in this
monthly. And your host today as normal are me, Ray here sitting in my living room in Ventner City,
and Zach Wells sitting in front of his bike in D.C. How are you today, handsome, and may I say,
what a good-looking top you're wearing today. Yeah, you know, a new shirt had to show everyone
that I do have more than a handful of t-shirts. Happy Thursday, February 26th. Thanks for tuning
in for another episode of Car Edge Live. I'm fired up. I'm in a great mood, Dad. Very excited to be
here with you. Excited to talk about an automaker that has lost $26 billion in just one year and
what that means for our community. But before we do, we must remind everyone that today's show is
brought to you by CarEdge.com, putting the edge in car buying. For those of you that are unfamiliar,
it's year six now. My dad and I have been providing with our incredible team a car buying service that
takes care of research, dealer outreach, and even negotiation. We learn what matters to you, contact
dealers, and compare real offers to help you get the best deal without the stress. Dad, you just
scroll down a little bit. You can learn about us being in the Wall Street Journal, Bloomberg, ABC,
the Today Show consumer reports. We've had such success thanks to this community. And to thank
our community, we are offering a promotion right now, $200 off our car buying service,
20% off CarEdge Pro. And as we've been talking about all week, we have a new product, the CarEdge
dealer ratings program, CarEdge.com slash dealer dash ratings. Continue to seek out feedback and
input here. Really excited about what we've built. You can come here. You can go to reports. You can
look at brand report cards. You want to find a good Toyota dealer? Boom. Go work with Tracy
Toyota. They're an a-rated dealer. They don't do add-ons. They have a good dock fee. They negotiate,
and you can even come here, folks, and see those negotiations from original out the door price
quote. Boom. To final out the door price quote, you've got all the receipts you need to make sure
that you're getting a good deal. Spend some time back at CarEdge.com slash dealer dash ratings.
You ready to jump into the show, pups? I believe I am. All right. We're going to start here. We're
talking about our beloved friends, Stellantis. They confirmed their full year loss debt. It'll be
$26 billion, and for the first time since 2011, that means profit sharing checks at the automaker
will be $0. Stellantis said, waving the flag, the yellow flag, maybe even a bit of a maroon to red
flag. This is bad, man. $26 billion loss is a huge, huge, huge hit for this automaker that's
obviously struggling not only here in America, but globally. Yes. The worst part about it,
if I may, at least in my mind, and I know there's a lot of haters out there who are going to say,
some of the problems that the legacy manufacturers in the United States are having is because of the
UAW contracts that were negotiated back in 2023. The only thing I will say to that is the manufacturers
agreed to them. They didn't think they were as bad as a lot of the public seems to think.
The sad reality is that these contracts that were negotiated include for every one of the UAW
employees, workers, and profit sharing. For the first time in 15 years, there will be no profit
sharing check from Stellantis. For context, Ford and GM are at about $6,600 in profit sharing from
the most recent years. Even amidst their struggles, they still were able to contribute that amount of
money to all their employees, which is tremendous. Yes. As an online, hourly employee, you are
counting on those profit sharing checks. You are looking forward to that as part of your
income for the year. To know that when Ford and GM employees will be cashing their profit sharing
checks over the next couple of weeks, that you suddenly will be out $3,000, $4,000, excuse me,
$5,000, that's harmful for a lot of people that are finding it difficult and are living paycheck
to paycheck. That's one part of the story. The other is, obviously, the automaker is struggling.
If you've been in the market or thinking about going into the market for a Stellantis product,
Chrysler Dodge Jeep Ram, the desperation level after a $26 billion loss just got notched up.
There's two stories here. I love that you go the angle of what does this mean for the average Joe,
for the people who are impacted by a $0 profit sharing check. The other one is the car buying
story, Dad, which is the desperation level, the alarm just went up even higher.
Yeah, but the average Joe came afford to be a car buyer. That all ties in and that impacts the
local economy. Now, the people that I think it doesn't impact are the C-suite executives
at Stellantis. My guess is that they won't get as big a bonus this year, but they're still going
to make their millions upon millions of dollars. Now, the good news for consumers, if there is good
news for consumers here, is, well, to help make up for that loss, that perhaps just perhaps they'll
have to become more aggressive in marketing and incentivizing the sale of cars either through
direct consumer incentives or factory to dealership incentives that would encourage
the dealerships to take a lower profit. That I think remains to be seen because there's only
so much money to go around and as much as we would like to think that they're going to take
whatever remaining dollars they haven't put in towards incentives, they might be thinking we
need to hold on to those dollars. I don't know. I hear you, but dad, I think the desperation level
is as high as it can possibly go and one of the ways that you can get Wall Street to love you
again is to show growth. You and I have been doing this professionally with CarEdge for six years.
You've been a professional in your career for over 50 years at this point and I've been in my
career for now a dozen. You know what makes people happy? Growth. The whole equation, the whole
conversation changes in any context if you're growing, if the chart goes up and to the right.
I think that Solanthus' hand is forced here, dad. You cannot come off the heels of what was it,
like almost a $6 billion loss in the first half of the year and a $20 billion loss in the second
half of the year. A lot of this to be clear, write downs of their e-vegetes, but even when
you take that up, they still would have lost money for the year. You got to show growth.
That's the only way that I think they're going to win back favor of investors of the market and
quite frankly, most importantly, of their customers. We've already started to see some signs on that.
Solanthus' bet is that we can go back to having V8 and the engine away from hybrid powertrains
and lowering prices. We've seen them do that. They've reduced MSRPs, which just leads into the
second story I want to talk about today with another automaker who's also waving the desperation,
flagging the desperation bell is sounding, but the $26 billion loss, dad. No one else is even in
spitting distance of that big of a loss. This is more than the market capitalization of other
automakers. It's in the context. This is huge. No. Listen, there's not a lot of businesses that can
afford a $26 billion loss or a $26 billion right off. I get that. It does not bode well.
It saves them on taxes that'll be owed all over the world. There are some positives for Solanthus on
this. Yes, with the new executives that they have in place, they have made a concerted effort,
at least in North America, to try and bring back the vehicles at the price points, the pricing
levels that their customers always wanted. I mean, when Carlos Taveras was the CEO,
he abandoned their customers. He made it plain and clear that they were just going to go up
market and keep raising prices. And as they did that, they kept losing sales and losing market
share. So, yes, they're moving in the right direction to win back their previous customers
to create that loyalty that had existed for a long period of time until they just blew it up.
But even though they're trying to win back their customers, are their customers in a position to
contribute to actually buying the vehicles even at a lower price point today? So, it'll be interesting
to see. But we have seen signs that what they're attempting to do is actually helping to increase
sales, which ultimately should help to increase market share. It has positively reduced stagnant
inventory levels that had been sitting around for 18 months or so. So, the moves they're making
seem to be moves that are moving them in the right direction. What begs to be answered is,
did they wait too long to do this? Is there enough consumer sentiment out there that says,
okay, with lower prices, I'll come back and look at these brands again? That, I think, is an open
question and remains to be seen. Y'all know me. I love doing live experiments. I'm over here on
the CarEdge CarSearch with the CarEdge.com picked shop new. And what I did is I went to Jeep U
Vehicles for Sale model year 2025 to 2025. We still have almost 51,686 brand new Jeep vehicles from
the prior model years sitting on dealer lots right now. And many of these, as you can see,
122 days, 154 days, 160 days on the market. These, and especially if I were to put in here now,
are they 4x ease? Are they hybrid powertrains? These are the vehicles that over the next 60
to 90 days, I think customers like, look at this Jeep Grand Cherokee, 305 days. There is immense
desperation at both the OEM level and at the dealer level. And I would love if you could speak to
this for a moment. Talk about that relationship. Talk about your factory representative coming to
you and saying, hey, figure out ways to sell more cars. Because it's the latest that again,
when they lose $26 billion like they did, when they have, in this case, 51,000 left over Jeeps
for sale. We haven't even done Dodge. We haven't even done Ram. They've got 100,000 plus left over
cars out there. What's the conversation like at the Monday sales team meeting? What's the
conversation like with your factory rep? How are they trying to motivate and incentivize the sale
of these vehicles? Well, I will tell you that when your factory rep comes to visit and he sits down
with the GM and he sits down with the new car manager, and the first thing that he's going,
he or she is going to go over is your aged inventory report. He or she will have a listing of all of
your vehicles that have been sitting around forever. And the first question he or she will ask is,
what are you doing to move these units? What type of incentives have you put on these vehicles
for your salespeople? What type of incentives have you put on these units for your customers?
Where are these units? Are they clean? Are they ready to go? Are there any issues with any of them?
Have you made sure that the batteries are good, that the cars have been detailed and
are shiny and near the showroom? And those conversations are not necessarily the conversation
that the new car manager or the GM wants to be having with their factory rep, because the factory
rep when they do that are pointing out every deficiency you have as a manager. And pointing
out that you haven't been doing your job and managing your inventory to the best of your ability.
So if I was the new car manager or I was the GM, trust me, every one of those bad boys would be
right around the showroom. They would all be clean. They would be clean two or three times a week.
They would be driven occasionally to make sure that there's no issues. And if it were me,
I would put huge incentives on these vehicles. Incentives such as you sell one of them, it's a
$750 minimum commission, plus I'll pay you a dollar for every day that it has sat on the lot.
So if it's been sitting there for 300 days, you're getting $1,050 for selling it. Well,
that carries some weight with a sales associate. Let me show you another example here, Dad. Again,
this is just a live experiment, 2025 Jeep Wagoneer S. Remember these? These are the all-electric
Wagoneers. MSRP is $67,790. The seller's price, the asking price $42,897. This dealer is discounting
this, at least advertising it with a $25,000 discount. And why are they doing that? You come
down here, Dad, and you look at the market conditions, 335 days on the market. But even
more importantly, a 1,845-day supply. There are 41 of these for sale within 100 miles of this one,
yet only one has sold in the last 45 days. Again, I am back to the desperation
that's the Lantus at the corporate level and at the dealer level are feeling right now. The good
news, what this means for you is if you had been eyeing, and I know it's not that many people
out there eyeing this type of vehicle, this 2025 Wagoneer S limited, but the few people that were,
yeah, go into your local dealership, the desperation, pull that up, show them that data,
and they're going to say, you know what? Take it away, pretty please, any price. Well,
we just need to get rid of it. What I would like you to do, you found that vehicle. Now I want
you to go to our transparency index and pull up that dealer and see just how transparent that
dealer is so that we can try and figure out if that $25,000 discount is real or fictitious.
It is the transparency of dealers that are going to make it easier for customers to want to buy
from them. It looks like, Dad, we don't have any data on that particular deal with the board.
What we do have just looking is that the Orisman dealerships that we do have
have an A rating for transparency. Yeah, they're not doing add-ons from the other Orisman dealerships
that we do have data from. You can see here, their dock fee is quite high, but that's what it is in
Maryland nowadays, I guess, but they're not doing add-ons. So that's good. But yeah, we don't have
data. I just typed in Orisman, and again, this vehicle that we're looking at is that Orisman
CDJ are a buoy. We don't have data from that particular dealership, but it is that, again,
even without how transparent the dealer is, it's a sign of desperation when you're advertising
a $25,000 discount and when there's a 1,845 days supply of inventory, everyone in the industry,
including consumers, should have access to this information to be informed about what a fair
deal is on this stuff. And the automaker that lost $26 billion, yeah, this is what it means for you.
If you are one of those rare people who wants that car, know that you have all the leverage
in the world and that the dealer and the automaker have all the desperation in the
world to get rid of it. And you know what the scary part is? The $25,000 discount might not
be big enough to move it, okay? Because there was only one person in the last 45 days to buy one
of those. That could be the only person in that area that has any interest at any price. So,
yeah, if you are interested in that type of vehicle, yeah, I'd go to the dealer and I would
print out that page that shows that there's an 1,845 day supply, that there's 45 of them for sale,
that one has sold in the last 45 days, that you have a legitimate buyer that A would like to buy
it has the ability to buy it. Are you going to let me walk away and not figure out a way to sell
me that vehicle? Because if you do, the likelihood of some other fool walking in here and suggesting
that they'd like to take that off your hands is pretty damn remote, I would say.
Yeah, yeah. Dad, I cannot get over just how big of an impact this type of corporate malfeasance
is ultimately having downstream on buyers. Again, you're interested in any of these vehicles which,
you know, more power to you. We're not here to judge what you want to get or not. If you want
to jeep wagon, what was it? A jeep wagon here, S limited? Power to you. Just do not pay anywhere.
Near sticker price and do not go in there. When they say, well, we add window edge to all of our
vehicles, so sorry, it's a 500. Tell them you've sat on this vehicle for a year. There's 41 others
for sale within 100 miles of this one and your parent brand just lost $26 billion. You want to
make a deal? Let's make a deal. It's just really important to understand the lay of the land as
you're navigating this. Yeah, you need, as a consumer, you need to understand your leverage
if and when you have it and how to use it. Now, you could walk into a Toyota dealership
and you don't have that same type of leverage. Yeah, I mean, to be clear, this is opposite
ends of the spectrum. This is as good as it gets. My point was going to be, you have to tailor your
conversation as a consumer at that dealership with the true level of whatever leverage you may
or may not have. You can't walk into a Toyota dealership as a hard ass and say, well, if you
don't give me 10% off, I'm not buying it. It doesn't work that way. Well, Dad, you and I both know
that our video on Saturday is actually one of our most recent AI negotiation experiments. We
sent our AI agent to a hundred Toyota dealers and we got pricing back. This is just like the
videos we've done in the past for the 104 dealers. I'm not going to give you all the information
here yet, but this is going to be our Saturday video. It does show some of the gamesmanship
in buying a Toyota RAV for a $9,000 price spread. You're going to have to tune into that
on Saturday over on the main car edge channel. Different leverage points. We should probably
do one for Jeep as well, but also some of the same gains show up regardless of where you
go. Now, Dad, let's turn our attention here to Subaru. There's a little bit of desperation
coming from this automaker. 2026 Forester pricing has been confirmed and Subaru is decreasing the
MSRP of this Forester by up to $2,015 on the limited hybrid trim. Look at this chart, Dad.
They're changing year over year from 2025 to 2026. They're adding more functionality,
more features in the new model year, and they're decreasing the price by four figures
on the Forester. This is really interesting. It comes on the heels of Subaru also saying we need
to grow sales significantly. Dad, they're going to be trying to sell a bunch of Foresters is what
this tells me. The reason they were able to do it is they have moved much of their Forester
production to Indiana. Some of the savings there for moving that production to Indiana
is what's allowing them to lower the pricing. They realize that at a lower price point,
they can better compete against one of their major competitors, which is the Toyota RAV4.
If they can price the Forester significantly below the cost of a RAV4, they should be able to
move more Foresters moving forward. If I'm looking at that and I'm reminded of when,
I guess it was 1999, when Acura came out with a new and improved TL, lowered the price by $5,000
and increased the standard equipment level significantly. Those were selling at MSRP for
like a year and a half. We couldn't keep them in stock. Everything was pre-sold. This to me
indicates that a Subaru really does get it and they are figuring out the levers to pull
when it comes to trying to increase their sales moving forward. My guess is in many cases,
these will be significantly $3,000, $4,000, $5,000 less expensive than comparable Toyota
RAV4 hybrids and Subaru dealers, even if they're in short supply, still seem to be of the mindset
to negotiate with their customers. Where your Toyota dealer might not, your local Subaru dealer
probably will, you'll find it to be a better value. I would think this is going to be huge
for Subaru. I want to pull up on the screen. We do have back on the new dealer ratings. Again,
this is still in beta, so you might run into some bugs, but we have the best Subaru dealers ranked
nationwide right now based on how transparent they are. I encourage everyone to come here,
whether it be the best or I could scroll all the way down here and I could unfortunately find some
Subaru dealers that you probably shouldn't go and do business with, or I shouldn't say you
shouldn't go do business with, you should just be very mindful. It's up to you. Be very mindful,
you can see here, for example, this dealership's adding some add-ons to their vehicles. You can see
the capital VIP protection. Did I, whoops, they pulled up the capital VIP protection. Did I ask
for that? Not sure. It's on a used car. Yeah, exactly. Deposit, non refundable, goes to purchase
price. Man, I love that we have all the receipts for everything here. It's really pretty incredible,
but I dropped that link in the chat because, again, while this is in beta, this is early,
if you are thinking about a Subaru, you know this. The 2025 Foresters, we're seeing big discounts in
0% APR. Why? Because the 2026s have a $1,000 to $2,000 MSRP reduction. What's the motivation
going to be for customers to buy a 25 once the 2026s are out? Again, use the new resource we have
to make an informed decision about which dealership you choose to go spend your time with. There's
mind-boggling to me. This falls into the path of other manufacturers making what was previously
standard equipment, something you have to pay for. We've seen this at times with subscriptions,
you got to see how you can get more horsepower out of your car. Toyota got in a lot of trouble
maybe a year or two ago when ultimately you had to subscribe to remote start your vehicle.
This concept of standard equipment becoming something you have to pay for is something
that we don't like here at CarEdge. Now, Dad, Ford is charging $495 for you to have a frunk
in your Mustang Mach-E. To be clear here, this has previously been just standard equipment. You buy
a Ford Mustang Mach-E, it has a frunk. Yeah. Has it? Now you're going to have, what was that?
Guess what? It still has a frunk. Yeah. To be clear here, you're paying $400. I'm just going
to reiterate, the 2026 Ford Mustang Mach-E of the electric crossover no longer offers a front
trunk as standard equipment. Instead, it's a $495 option, though the starting price of the vehicle
has been lowered $150 to make up for the lost underhood storage. If you want to open your
frunk, you want to have a frunk, you got to pay 500 bucks. I read, I was like, what is going on?
What? Something's no sense to me. And the frunk's there. What's the frunk? What's the frunk?
What's the frunk? Because the frunk is there. It's not like the frunk is gone. It might be a
software issue just to be able to unlock it, to get to it. It is one of the most ridiculous
things that I've ever seen. You're lowering the price $150. Meanwhile, it's still there,
but if you want to be able to access it, it's $495. Well, okay, well, why don't you lower the price
$495? And if a frunk is worth $495, well, then lower the price. If you're taking the availability
of it away, I see things like that. I love this comment that are enough people buying the Maki
to care. No, we're still going to talk about it because it's ridiculous. But those who are,
who might have possibly wanted to utilize it, and the reason for it did this is because they
realized through research afterward that people are not utilizing the frunk as much as they thought
they would. And then the frunk has gotten smaller because they had to put in a bigger heat pump
or something. And so the usable interior space of the frunk is smaller than it's been, and people
weren't basically using it in the first place. That would be like saying, all the stuff that
came standard in my Mazda that I don't use, I shouldn't have access to because, well, I don't
use it anyway. But what if I wanted to? What if there was a time where I said, where I had a
Mustang Maki, and I said, damn, I need that extra frunk space. This is that one time. It's already
in the car. Why can't I access it? So that's the type of short-sighted nonsense that these
manufacturers do. And then they wonder why consumers don't think highly of them. Well,
you know, if you expect your dealers to operate in a straightforward way, which you do expect,
but you know it's not happening, maybe sometimes the dealers just mirror the actions of the
manufacturer. And this is, in my opinion, one of those cases. The damn thing has a frunk. Just
leave it alone. If somebody needs it three years down the road, then they can have access to it.
They don't need to pay extra. Dad, the quote here, quote, we were learning that customers were using
their frunk, but perhaps not as much as we had originally intended Teddy Ankeny, Ford's Mustang
Maki brand manager, told the electric duo on YouTube, quote, so in order to kind of preserve
that customer choice, we made it optional for the 2026 model gear. That makes no sense. That is
like mind-meltingly illogical to me. To preserve choice, we made it optional and you have to pay
for it because people aren't using it. What? And I don't know this individual. I don't know this man.
Maybe it was set out of context. Like, I want to give all the benefit of the doubt in the world.
This one makes zero sense. Well, it's just corporate speak. It's corporate speak. Yeah,
it means nothing. Yeah, they mean nothing. We want to share with you that we can have such
convoluted thinking that at some point as a customer, you're going to look at us and go,
these people should seek mental health advice. Okay, because there's no way you can even put
that in words and expect people to look at and go, oh yeah, that makes total sense. Doesn't make
any sense. It's already in the car. Stop it. Stop acting like the greedy sons of guns that you are.
Okay, when you do this stuff, try being honest. Say, you know what, not enough people are using it
and the people who don't want to use it do want to use it. They're going to have to pay for it.
And that's just the way it's going to be because, well, we can use the extra money. Just be honest.
But there's no honesty in this country, period. I mean, nobody will ever admit an honest thing.
It's like, well, I got to think of a way to color this so it doesn't make me look as bad as I really
am. Just be honest. There's an opportunity for us to make more money by doing it this way for the
people who might actually utilize a frunk. Okay, great. There's some honest people out there,
folks. They're back at CarEdge.com. My dad and I are so proud for the past six years of what we've
been able to build and the services we're able to provide. Again, for those of you that are
unfamiliar at CarEdge, we provide a car buying service that takes care of research, dealer
outreach, and even negotiation. We learn what matters. Do contact dealers, compare real offers,
and help you get the best deal without the stress. Again, we have a promotion running $200 off our
car buying service, 20% off CarEdge Pro. And this Saturday, we've got a really, really, really good
video over on the CarEdge main channel. You can check out the data early. I'll drop the link in
the chat. It's CarEdge.com slash experiments, if you want to learn and get the data early. But
we've got all the information from contacting 100 Toyota dealers for a similarly priced Toyota
RAV4. And you will not believe what happens next. Actually, many of you will believe what happens
next. So check it out. That video will be dropping on Saturday, but the data's up on the CarEdge
website if you want to check it over. First, dad, again, a great show. We'll be back tomorrow with
more CarEdge live. I'm certain there will be more things that we want to talk about. But holy cow,
what a show for today. Absolutely. Thank you for finding some of these topics. And I guess,
you know, the real thanks go to the morons that are running these major companies because, you
know, we couldn't do what we do. We couldn't discuss what we discuss if there wasn't some moron
in a C-suite going, hey, we need to lose $26 billion. Or, you know, wouldn't it be nice to charge $495
for a frunk? You know, so thanks. Thanks to the good folks at Stalantis in Florida for making our
job easier, in my opinion. We'll see you tomorrow, folks.
If you liked the show, please take a moment to rate, review, and subscribe. It really does help
the show to grow. Thank you for listening.
About this episode
Stellantis reported a staggering $26 billion loss for the year, marking the first time since 2011 that its UAW employees will receive no profit-sharing checks. The hosts discuss the impact on workers living paycheck to paycheck and the automaker's struggle to regain market share amid inventory glut and pricing challenges. They explore how Stellantis is attempting to win back customers by lowering prices and reintroducing V8 engines, while also highlighting the pressure on dealerships to move aged inventory through incentives. The episode offers insight into the broader implications for consumers and the auto industry.
Today on CarEdge Live, Ray and Zach discuss the latest losses at Stellantis and others. Tune in to learn more! Hosted by Simplecast, an AdsWizz company. See https://pcm.adswizz.com
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