As we head into the fifth month of a global pandemic and economic shutdown, there appears to be no end in sight to the political and ideological division confronting the United States. Citizen unrest and insurrection in Portland and Seattle have continued for more than 70 days, while most of the nation tries to move onward.
And now, the popular TikTok app is being threatened by President Trump of getting banned in the US due to its ties to the Chinese Communist Party. What could this mean for TikTok money makers, Big Tech, and his presidency? And would Microsoft’s acquisition of the Chinese company appease US lawmakers?
This week on the Mobility Tech & Connectivity Show, we discuss the impact of this divisive situation and the potential Microsoft buyout. We also take a deep dive with our Special Guest for the day – Steve Greenfield from Automotive Ventures, into how “Digital Retailing” (or Remote Retailing) players may benefit from the pandemic in the long-term.
And finally, it’s Used Car Week on the show and we have a panel discussion lined up to look at the state of the used car business and key developments. And we will be drawing the spotlight on a new website for service recalls with Guy Campbell from Marketcheck.
Also on this week’s program…
- Dealers Win Critical Court Decision Against CDK, Reynolds & Reynolds
- Early look at July’s used-car sales figures
- ADESA hosts 22-site digital sale for Hertz via Simulcast+
- Updates on Hertz Bankruptcy
- Is TradeRev The Next Big Thing for Dealership Wholesales?
The Mobility Tech & Connectivity Show
Airs Live Wednesday August 5th at 2 o’clock CST (US & Canada)
Digital/Remote Retailing: A Key Beneficiary of COVID-19
As we have discussed in previous episodes, automotive retailers became immediately strapped back in March when the pandemic crisis first hit and were restricted if not prohibited from selling cars inside of showrooms. This led to swift adaptations by all dealers to embrace or optimize their ability to conduct car sales remotely.
In the latest newsletter by Automotive Ventures, Greenfield includes an entire section on how consumer needs are changing rapidly, and how “digital retailing” players may benefit from the pandemic in the longer term. Some key takeaways from the report include:
- Due to COVID-19, the transition from offline-to- online is accelerating across industries
- Automotive Digital Retailing is positioned to address these consumer trends
- Dealerships have had to embrace digital solutions to remain relevant
- There are a number of digital solutions for dealerships; many are “certified” by OEMs
- Key Question: Where and how should investors place their bets to create the most value for Consumers,
- Dealers and OEMs in the Digital Retailing value chain?
- Fueling interest in the space is the comparative market capitalizations of Carvana ($26B) vs Carmax ($16B), the 21% Market Cap increase Lithia experienced from announcing www.driveway.com, a
Greenfield is Founder & CEO of Automotive Ventures, an automotive technology advisory firm that helps entrepreneurs raise money and maximize the value of their companies. The company also helps private equity firms conduct due diligence on automotive technology acquisitions, advises technology CEOs on strategy, and helps represent sellers at time of sale.
Recall Service Leads by Marketcheck
The internal systems you currently use to find and contact vehicle owners for recalls will only provide you with a small fraction of the owners in need of recall servicing. Marketcheck, a Data-as-a-Service company that supplies commodity insights to many of the top Automotive SaaS companies in the U.S. and Canada, can now provide you with the hundreds of thousands of owners that your current systems cannot discover, detect, or locate.
On any given day in the U.S., there are around 180,000 vehicles in Independent Dealership’s inventories which have non-repaired recalls. In Canada, around 5,400 non-repaired recalls.
The new website also locates recalls on Private Seller listings. Today there are around 13,000 FSBO listings which have open recalls. These leads are a perfect opportunity to invite a consumer who is looking to get a new car into your service department to repair a recall, service the vehicle, or even make a trade offer.
Unlock contact info and locations for thousands of vehicles with non-repaired recalls to generate more service hours and increase revenue to your service department.
Go to www.servicerecalls.com.
In the News…
Official Coronavirus updates, plus…
Dealers in Arizona scored a major victory late Friday when the U.S. District Court in Arizona ruled strongly in favor of a 2019 law that gives local dealerships greater ability to protect customer data that resides in dealer management systems.
Two dealer management system (DMS) providers, CDK and Reynolds & Reynolds, last August sued the State of Arizona to overturn the 2019 law, seeking an injunction to keep the law from ever going into effect. Late Friday, the court found that the DMS providers were ultimately unlikely to succeed on the merits of their case and denied their request for a preliminary injunction, paving the way for the law to go into effect.
The law was passed unanimously by the Arizona legislature in April 2019, where it was vigorously supported by the Arizona Automobile Dealers Association (AADA).
Used-car sales this month are likely to be down slightly from June, but beat-year ago figures by 9%. That’s according to the latest forecast from ALG, a subsidiary of TrueCar.
Specifically, ALG is forecasting 3,759,781 pre-owned sales for July, which would be 1% softer than June but a 9% year-over-year-hike. Not to mention, according to TrueCar’s data, there are many would-be new-car shoppers turning to used.
ADESA utilized its Simulcast+ digital auction platform last week to host a 22-site online sale on behalf of The Hertz Corp., selling cars digitally to buyers in 19 states during this single digital auction event.
The Simulcast+ platform, which ADESA first began using in April, is a new digital auction platform designed to simulate a live auction environment through a live streaming format that’s fully digitized and highly automated, parent company KAR Global said in a news release.
Hertz Global Holdings Inc. has struck a deal that will cut the debt it owes lenders who financed its rental car fleet to less than $5 billion from $11 billion by Dec. 31, the company’s main bankruptcy lawyer said in court Friday.
Under an agreement with the lenders, Hertz has agreed to sell 182,000 cars over the next few months, Tom Lauria told U.S. Bankruptcy Judge Mary Walrath. The deal requires Hertz to make $650 million in lease payments. The reduction in the $11 billion in vehicle debt is tied to the auto sales, Lauria said.
In an article published last year by Automotive Financing specialist Fabien R. MBOLLO, the author suggests that TradeRev, whose parent company is KAR, is a disruptor with the ambition of capturing upwards to 80% of dealer-to-dealer sales. Fabien suggests that traditional car auction companies should prepare for the storm that TradeRev is bringing to their once safe havens.