#757 - 🚗 Weathering Storms and Surpluses

TOGETHER WITH

Our team is wrapping up episode four of “More Than Cars” with Mohawk Chevrolet this week, and we daresay it’s shaping up to be our best episode yet!

We’re piecing it all together as you read this, and we can’t wait to get it in front of your eyeballs soon.

In the meantime, if you haven’t seen Mohawks’s viral spin-off of “The Office” called “The Dealership,” you’re really missing out.

Don’t worry, we got you. 👊

Keep Pushing Back
-Paul, Kyle, Chris & Kristi

_{Was this email forwarded to you? Subscribe here!
Reading time: 4 min and 42 sec}

BUSINESS

Storms, Savings, Stockpiles and Support

Resiliency (or, lack thereof) seems to be the running theme in today’s email. Whether it’s rebounding from a natural disaster or overcoming disabilities, it’s all about how you bounce back and overcome. Let’s get into it.

. . .

Debby’s Deluge Disrupts Dealers

Hurricane Debby has been a real downer this week after making landfall in Florida on Monday. The destructive storm has dumped over 16 inches of rain, left hundreds-of-thousands in Florida without power, and resulted in more than 1,600 flights canceled.

• State Response — Florida Governor Ron DeSantis declared a state of emergency for 61 counties, and mobilized 3,000 National Guard members to help rescue hundreds from flooded homes.

• Dealership Response — Florida auto dealers are now in assessment mode as the water recedes and showrooms recover from power-outages. Ted Smith from the Florida Automobile Dealers Association says it's too soon to know the full impact (especially those strongest hit between Tallahassee and Jacksonville), but that dealers are working to keep their operations running as smoothly as possible and offering helping-hands where they can.

• Who’s Next? — Debby has it’s sights set on the Carolina’s next and officials are warning of more rain and flooding with up to 20 inches possible on the coast.

Audi Revives Costco Discounts

After a continued decline in U.S. sales, Audi decided to partner once again with retail giant Costco for another round of limited-time vehicle specials. Costco’s Auto Program is offering members enticing discounts — from $1,000 to $3,000 — on new 2024 or 2025 Audi models.

• Sales Push — Earlier this year, nearly 4,000 Audi Q5s were sold during a similar spring special. However, Audi's U.S. sales are still down 12% in the second quarter and 14% for the first half of 2024 compared to last year.

• Past Success — Costco Auto Program said more than 25,000 Audi vehicles were sold through program-approved dealerships in 2023 (with around 9,000 of them being Q5 crossovers). Audi is hoping these incentives in partnership with with the wholesaler will help them to meet or exceed those numbers this year.

Mo’ Inventory, Mo’ Problems

A new study from S&P Global Mobility shows us that automakers are facing an inventory surplus at the moment with new vehicle stocks up 57% YOY reaching nearly 2.9M cars.

• Surge in Supply — June marked the 13th consecutive month of inventory increases, with a 1.8% rise over May. Most vehicle segments have grown steadily, but compact SUVs have seen especially sharp spikes in inventory over the past year.

• Buyer’s Market — With three times the inventory but not three times the buyers, consumers have a wide array of choices but many vehicles are sitting in lots waiting for shoppers who can afford them.

We wanna know…

ToyotAbility Triumphs in Texas

Toyota's truck plant near San Antonio, Texas recently celebrated it’s ribbon-cutting ceremony for their ToyotAbility Production Center (TPC), where differently-abled workers are playing a key role in production.

• Long Time Coming — Along with Toyota Texas employees, the TPC project has been a collaborative effort with Texas Workforce Solutions, Mission Road Development Center, local government officials, and community leaders more than five years in the making.

• Innovative Inclusion — The new subassembly area brings workers with intellectual and developmental disabilities (an estimated 15.6% of San Antonians) into the heart of operations. Designed with optimal lighting and soundproofing, the center provides a comfortable environment and easy access to resources and amenities.

• Valuable Contributions — The team of six has produced more than a quarter-million parts for the Toyota Tundra and Sequoia since opening earlier this year.

TOGETHER WITH MOSAIC

Today’s The Day

The CARS Rule is currently under review at the 5th Circuit Court of Appeals. Oral arguments are scheduled for the week of October 7th and a decision on its fate could come by the end of the year.

How will it impact dealers?

Join Paul and Kyle along with Jim Ganther, CEO of Mosaic Compliance Solutions, today at 2:00PM EST to understand what to expect and how to stay ahead.

➡️ Register here! ⬅️

MORE THAN CARS MOMENTS

Paving the Way to a New Normal

After 43-year-old Amy Dicks was innocently caught in the crossfire of an Atlanta highway shootout back in April, she was tragically left paralyzed from the chest down.

The team at Toyota of Montgomery was deeply moved by Amy's situation and rallied together to make a difference. Upon returning home from months of rehabilitation in Atlanta, Amy was presented with a $100,000 accessible van in her color of choice. More than a dozen employees were present as Amy received her new 2024 Toyota Sienna.

Amy expressed her gratitude on social media, calling the donation a "Godsend" and thanking Brett Sutherlin and the dealership for their generosity. With the van, Amy says she can more easily transition into her new normal. Way to go, Toyota of Montgomery! 👏

AROUND THE ASOTU-VERSE

Coming Soon

👊 August 9-11th — VeeCon in Los Angeles, CA.

👨‍⚖️ August 19th — Paul and Kyle judging the Automotive Amplifiers Contest with Reynolds & Reynolds in Leesburg, VA.

🌴 August 20-24th — NAMAD Conference in Miami, FL.

🍎 September 16th — The Welcome Conference in NYC.

DATA & INSIGHT

Credit Crisis

The Federal Reserve Bank of New York’s Quarterly Report on Household Debt and Credit shows that debt in the U.S. has increased to $17.80T in Q2 2024, with credit card debt hitting a record $1.14T.

That’s $27B more that last year, a 5.8% increase.

Additionally, auto loan balances have also grown by $10B, reaching $1.63T.

The report also notes that delinquency transition rates for credit cards, auto loans, and mortgages have ticked-up slightly with approximately 9.1% of credit card balances and 8.0% of auto loan balances transitioned into delinquency over the past year.

Quick Hits

• Bentley has filed a patent for a “Flying B” drone that would be housed in the hood of the car. 🐝

• A federal judge ruled against Google on Monday saying that the company acted illegally in order to maintain its monopoly. 👨‍⚖️

• Elon Musk confirmed that a second trial patient has received a Neuralink implant. 🧠

History

• 1606: The first performance of Shakespeare's “Macbeth” is performed at Hampton Court Palace for King James I. 💀

• 1944: Volkswagen halts production for WWII. ⏸️

• 1948: American athlete, Alice Coachman, becomes the first black woman from any country to win an Olympic gold medal. 🥇

Thanks for reading, friend! May your Hump Day be as rewarding as it is productive. Hit us up here or on socials, and let us know what you’re working towards today.