#497 - 📈 All Mixed Up

TOGETHER WITH

Filming More Than Cars Episode 4 has begun, and we can’t wait to share more stories from the most vibrant industry on earth!

Spoiler: How do you feel about high-heeled basketball?

Keep Pushing Back
-Paul, Kyle, Chris & Kristi

TODAY’S LOT WALK

• Data & Insight: An economic update from the pros heading into the last month of Q3

• Business: Screens, scooters, and discounts in China

• Culture: More Than… Burritos?

Reading time: 4 mins 11 secs

DATA & INSIGHT

Navigating Toward Success

As we roll into the last month of the quarter, the Automotive Advisor gives us all the deets on the industry so that you can set yourself up for success for the remainder of the year. Here’s what you need to know:

🛍️ Economic Mixed Bag:

• Economic sentiment surged to its second-highest level in 21 months.

• The unemployment rate rose slightly to 3.8% in August.

• The labor force participation rate increased slightly to 62.8% after being flat since March.

• Consumer sentiment dips along with stock prices as gas prices and interest rates continue to rise.

☝️ Sales Trends Point Upward:

• August witnessed a substantial 19% YOY surge in sales, a testament to pent-up demand in the market.

• New vehicle sales are on the upswing, increasing by over 3% in August. Pent-up demand from consumers and businesses, especially in the form of rental fleets, continues to be fulfilled as new vehicle supply and pricing improve.

• The used car market maintains its strength, with a remarkable 9% increase in sales compared to last year.

👷 Wholesale Market Dynamics in Flux:

• Hinging on the outcome of the UAW strike, the wholesale market is on the brink of significant appreciation, especially for 2020-year models.

• If the strike happens or lingers until the deadline, we could see even more used car appreciation. Even a looming strike is enough to make the key players nervous.

🚧 Challenges to Profitability:

• Margin erosion is a growing concern — notably affecting 2 and 3-year-old models. This decline is impacting both luxury and non-luxury segments, translating into a dip in profitability.

• Don’t panic. Dealers are urged to maintain adaptability and flexibility in their strategies during these uncertain times. Navigating the opportunities and challenges that lie ahead will require keeping a close eye on the turbulent market dynamics (psst…that’s what we’re here for 😉).

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Change is inevitable, but improvement requires we stand together and push. We’re looking forward to pushing back with you!

BUSINESS

German Auto Maker News

BMW has so much going on. Their Neue Klasse EV is not only a watch tower of windows and screens. It will also feed data back to Amazon Web Services, including self-driving data that will be processed and used to develop driving assistance services across the brand's upcoming EVs.

Their CE 04 electric scooter will likely require people to use two hands and both eyes to drive since scooters just be like that. But with an 80-mile range and a 75 mph max speed, it's the perfect vehicle for jobs less than 40 miles away or grocery store trips when you only need things that fit in your pockets.

Audi's Q6 E-tron isn't a scooter, but it is another tally mark in the "Screen are in right now" column. There are three screens for the people sitting in the two front seats: one for the gauge cluster, one for infotainment, and then one just for the passenger prince/princess in all of us.

People seem hyped about it all. Audi anticipates a modest 2023 sales increase before a significant EV expansion in 2024. Despite trailing BMW and Mercedes in EV offerings, Audi plans to launch ten electric models by 2025, starting with the Q6.

Not enough people appreciate that you can't spell "Volkswagen" without "Swag." The German brand is working to keep its foothold in the world's largest auto market with big price cuts on its ID.4 EV in China. Now starting at $20k, the EV is almost 25% cheaper than its 2021 launch price of $26,700. Will it sell more cars? Sure! Will it make more money? 🤷‍♀️

CULTURE

Behind the Beans

According to a recent press release, Chipotle announced it is launching a brand new round of “Behind the Foil” snippets fresh for the Fall.

Hmm, wait a tick. This sounds super familiar…

They are:

• Expanding their documentary-style content series to highlight current employees and attract new talent.

• Featuring candid testimonials from dedicated team members to provide an unfiltered look into what it's really like to work in the business.

• Telling the real stories of the real people who service their customers.

• Showcasing all the benefits of working in their retail space, including competitive wages, growth plans, and bonuses.

Oh, yeah, now it’s ringing a bell…

“There is no better way to make Chipotle more visible, relevant, and loved than to feature our talented team members while sharing their authentic stories,” said the chief brand officer for the burrito biz.

Replace “Chipotle” with “the auto industry,” and this could be about “More Than Cars!” 👀

Quick Hits

• Loki Season 2 is coming October 6th to Disney+ 🍿

• Construction workers in China create a shortcut to the job site - through the Great Wall. 👷

• NYC tightens restrictions on short-term rentals, spelling the potential end of Airbnb in the area. 🏨

History

• 1716: The first lighthouse is built in North America in Boston. 💡

• 1891: Peugeot debuts the Type 3 Quadricycle. 🛺

• 1997: The funeral of Diana, Princess of Wales, is held at Westminster Abbey in London. 👑

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