#501 - 🪴 Mini Plant Makeover

TOGETHER WITH

Two weeks until we are all together again in Baltimore, MD, for ASOTU CON.

It’s going to be an energizing and (r)evolutionary event, but there is some homework to consider.

Picture the retail auto industry you want to be a part of. The dealership you want your friends and family to show at or even work in. The neighborhood business your neighbors need. Picture every detail you can.

Hold that picture in your mind and bring it to ASOTU CON 2023 September 25 - 27 so together we can bring it to life.

Keep Pushing Back
-Paul, Kyle, Chris & Kristi

TODAY’S LOT WALK

• DATA & INSIGHTS: The auto market remains uncertain as tense UAW negotiations continue. 🔎

• BUSINESS: Ford adopts Apple Maps, Volvo tightens its belt, and BMW invests in Mini plants. 🌱

• CULTURE: The future of ice cream (spoons)? 🥄

Reading time: 4 min and 18 secs

DATA & INSIGHT

Decoding Market Data

Each week, John Ellis and the Automotive Advisor team keep us up-to-date with the latest moves in the market. Let's dive into the most recent developments:

🎭 Economic Insights — Second-quarter real GDP growth has been revised down to a 2.1% YOY increase, highlighting economic fragility. While income losses remain minimal and August job growth surpassed expectations, there is a sense of unease among workers, particularly those with higher incomes. Consumer spending, on the other hand, is gaining momentum.

🪧 Union Negotiations & Supply Chain Risks — Ongoing contentious union negotiations pose potential disruptions to the North American vehicle supply chain.

📈 New Car Trends — The average days' supply of new vehicles in the U.S. currently sits at 58 days, the highest in two years. Though new car sales experienced a surge, the pace is beginning to level out.

📉 Used Car Trends — Used car sales continue to exhibit steady growth, fueled in large part by declining prices.

🔋 BEV Trends: BEVs are projected to account for 8% of August’s sales, in line with July’s figures. Ford reported a 61% growth of the Mach-E while Hyundai reported an 80% YOY growth of its hybrid and electric vehicles.

💪 Wholesale Market Stability — Wholesale markets are stabilizing, especially concerning three-year-old models, which benefits acquisition strategies. This equilibrium extends to the broader wholesale channel, as indicated by the stabilization of the two to six-year-old vehicle Black Book Index.

🚧 Market Softening and Challenges — While there's a robust YOY growth of 17% in August, the MOM increase is a more modest 3%, signaling potential market softening. Daily selling rates are experiencing a mild descent, and inventories have surged by 57% compared to mid-August 2022.

🤑 Financial Considerations — Rising interest rates and concerns about new vehicle affordability require close monitoring. Dealer-advertised inventories have remained steady at approximately 2.3M units since July.

TOGETHER WITH UPSTART

Expertly Crafting Cohesion

Upstart Auto Retail combines online and in-store digital retail capabilities with financing and manager tools to help you create a cohesive, omnichannel car-buying experience to:

🙌 Be everywhere. Meet car buyers across every touch point and on any device. Create a consistent digital retail experience that gives car buyers the ability to build their deals online and seamlessly pick up where they left off in your showroom.

🧱 Build trust. Deliver full transparency by staying with car buyers throughout the entire experience—all while boosting CSI scores and ratings. Manage deals including terms, APRs, discounts, and down payments in real-time.

🤝 Guide car buyers. Help car buyers along the way from adding F&I products and protection plans to providing the right loan offers. Improve customer satisfaction and increase PVR for your sales team.

BUSINESS

Industry Round-Up: Ford, BMW and Volvo

Apple Maps is set to join the EV nav party by expanding its reach to the Ford F-150 Lightning later this year. 🗺️

When synced with CarPlay, Apple Maps’ EV-focused routing feature carefully monitors the vehicle’s battery life, strategically plans re-charging pitstops, and provides real-time information on station availability, making it an invaluable tool for EV drivers on the go.

The function is slated to roll out in Q4 to 2022-23 models through a software update. ⚡️

Volvo announced plans to dedicate a hefty $88M toward boosting efficiencies and cutting costs long-term. As part of the cost-cutting criteria, Volvo has plans to tighten its belt globally by trimming over 10% of its white-collar workforce in the US and Canada. 🌎

CEO Jim Rowan says their goal is to shift entirely to EVs by 2030, a costly venture, thus necessitating the dramatic money-saving measures including early retirements and downsizing.

BMW is investing $750M in its UK plants to ramp up the transition of its Mini brand to fully electric production. 💰

Plans are for at least two electric models to be made at their plant in Oxford by 2026 and exclusively produce electric models by 2030.

BMW also intends to allocate investment funds to its plant in Swindon which makes parts for Mini models, but the future of their Hams Hall engine plant remains uncertain. 🏭

AROUND THE ASOTU-VERSE

Less Than A Fortnight

No, not the video game, the timeframe! As every modern person knows, a fortnight is 14 days and that’s one less than we have before ASOTU CON is upon us! 💃🕺

Don’t miss out on the S-tier speakers and topics we’ve assembled to ensure every guest leaves informed, connected, and encouraged to keep pushing back. 💪

CULTURE

Two Scoops Of Innovation

Tesla's Chinese division is teaming up with McDonald's to unveil 50K "Cyber Spoons" 🥄 inspired by the iconic Cybertruck design.

Elon Musk was skeptical 😲, but official Chinese social media confirms its legitimacy.

Accompanied by Cybertruck-themed packaging and priced at $4.00 USD, this unique spoon showcases the phrase "DON'T PANIC" 🚀 and is nestled in a "powered by Tesla" storage tube.

So, if you're a Tesla fan, catch a flight to China and save room for dessert. 🇨🇳 

Quick Hits

• Google is going head-to-head with the U.S. Department of Justice in a landmark antitrust case. ⚖️

• On Saturday, leaders at the G20 summit announced plans to construct a massive rail and shipping corridor that would link India with the Middle East and Europe. 🚂

• Smuckers is buying Hostess Brands in a $5.6B snack food deal. 🍇

History

• 1959: Bonanza premieres, the first regularly scheduled TV program presented in color. 🌈

• 1978: The sitcom, Taxi, is introduced on the ABC channel starring Danny DeVito, Marilu Henner, and Andy Kaufman. 🚕

• 1981: The animated cartoon series, The Smurfs, first broadcasts in North America. 💙