Dealer Tech Tuesdays
Dealer Tech Tuesdays - Where we discuss all things dealership tech. The good, the bad, and the ugly. We believe tech can empower your dealership to conquer an ever-changing world.
Dealer Tech Tuesdays
S01E07 - The Paul and John Show - Future Proof Your Dealer - Electric Vehicles
Dealer Tech Tuesday is a podcast and Clubhouse room on the Automotive Innovations Club. It airs at 2pm EST every Tuesday. It is a discussion and QA for anyone in the automotive space. VTech Dealer IT hosts the show, bringing in experts in their respective fields.
This week's episode is with my co-hots Paul Jensen from the Qvale Auto Group. We discuss future-proofing your dealership and the effects of electric vehicles on your operation.
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Well, all right, everybody, it's 2 o'clock on a Tuesday. Everybody know what time that is. That is the Dealer Tech Tuesdays. We are today presenting the Paul and John Show Paul Jensen and I.
Speaker 1:Paul is the operations manager, executive member for the Cavaliato Group. So we're going to have kind of conversations about future proofing your dealership and what does that look like. Paul has done an incredible amount of heavy lifting on the project side for the dealership space and has had, has seen how the industry has been changing a little bit and requiring some future proofing, or what steps can you take to future proof your dealership towards the kind of changing landscape. So today we're going to talk a little bit about that and, without further ado, welcome Paul. Well, thank you John. So, paul, kind of before today that we got on the call, we were talking a little bit about future proofing the dealership and what does that look like? And how have the manufacturer's requirement changed over the last 24, 36 months? With the new landscape changing and moving towards electric vehicles, the electric grid, how have you guys seen that change and change in requirements for dealerships?
Speaker 2:So each of the manufacturers that you deal with generally have a requirement of some sort in terms of what the facility is going to look like, what the materials you use are and how you do that.
Speaker 2:And you know, in the last two to three years there's been a big shift toward the EV market and dealerships are being required to do some retrofitting, making sure you've got lifts and tools and chargers and things like that into the building. What I have found is that some of the manufacturers have a vision of what that's going to look like in five to ten years and some of them don't. In terms of what you should be looking at in the shop in order to get a battery out of an EV vehicle, you've got to have a wide stance lift. In-ground lifts don't really work because the posts are too narrow. If you've got overhead lifts in, generally they do work. Most of the dealerships that I've been involved in all have in-ground lifts and we've actually had to decommission some in-ground lifts and put some overhead lifts in in order to meet just the bare minimum requirements of that. So do you think?
Speaker 1:that you're expanding the footprint of the dealership or is that reducing the footprint of the dealership overall? The footprint of the dealership or is that reducing the footprint of the dealership overall? I mean, you would imagine that, with you know, the normal vehicle has 200,000 moving parts and an electric vehicle has a quarter of that. Would you think that the footprint would be smaller? Or is it just more technology heavy?
Speaker 2:I think you still need to have enough lifts to service the vehicles that you're going to have on the road. My personal opinion is that the service business is going to change from a maintenance-type operation to more of with the electric cars it's tires. Brakes are much less of an issue because they don't. You know they use regenerative braking, so your brake pads don't see the service interval that a gas car will. There's no more oil changes, no more coolant flushes, no more injector services. You've got to be able to do most of the software. Updates are going to start becoming over the line kind of thing where the car will download its own things. We'll be doing a lot of diagnosing of any issues and repairing just the mechanicals, the electric motors and body work. You know the body things that can go wrong. So I see the service business as going down in terms of that.
Speaker 1:But do you think that there's going to be some? You know a different type of problem where you're changing battery cells out. That you're doing. You know more software updates to vehicles, you know.
Speaker 2:Yeah, I think there will be.
Speaker 2:I don't know that it's going to how much it's going to affect the overall business. You know, when we've designed most of our new facilities, that we've done we've designed shops in the vicinity of a small shop from 11 to 12 lifts to a larger shop of 20 to 25 lifts. You know, big shops are 40 to 50 lifts. All the shops that we have designed over the last eight, nine years have all been designed to do double shift. So the big thing with a double shift is that you have to have two sets of toolboxes for the technicians and you have to have a plan for turning the lips over from one shift to the next. So our shops are designed so that we can double up on the toolboxes and still have enough room to run two shifts. So, capacity wise, a smart dealer once told me you know, don't overbuild your facility because that's something you have to pay for for 30 years. If you can get away with a smaller facility and a smaller footprint and still get the work out of it, you're much better off.
Speaker 1:Yeah, I mean that makes sense. I mean you've built in almost some expansion points, right. I mean you've built in almost some expansion points, right. It's like phase B and phase C that if you need an additional lift, you've already built the pits for it.
Speaker 2:We've got space to put those in. Yeah, we did that in one of our facilities where we already had a front-end machine.
Speaker 2:We were coming from a smaller facility to the larger facility, didn't have a big base of business, but we designed one of the bays in the new facility for the pit for a front end machine and then filled it in yeah so that when we get to the point that we need more space or a second front end machine, all you have to do is bust the top of it out and put a lift in yeah, you're in business, right, and so how are you building the grid?
Speaker 1:or you know, obviously electric vehicles need a massive amount of power. How are you prepping in that degree for the organization, right it's like, are you?
Speaker 2:talking to FPL and saying, no, we need chargers to meet the current needs of the vehicles that we see that are coming down the pipe now. So each manufacturer has a different requirement depending upon how you want to get in the game. You have to be careful that you have enough power coming into the building to service those additional chargers. One of the manufacturers is requiring that the dealership have a 350-kilowatt charger in the front of the building, which typically will require additional service to the building from the grid. That's wild. So you have to make sure that you've got. If you're doing any renovations or you're doing any plans for upgrading your facilities, keep all that in mind that there's going to be as we get further down the road, there'll be more demand for electrical power in the building.
Speaker 1:So are the manufacturers kind of pushing towards a place where the dealership is also going to become a gas station or air quotes electrical refill station, that they're going into a convenience store type situation? Or is it just going to be just straight up dealership only for the vehicles that are there and move forward, because you would see a natural integration of the refill? Gas stations are peppered across the United States, right, and the biggest problem with electrical vehicles is that the infrastructure doesn't necessarily exist. So Tesla has their recharge stations.
Speaker 2:You get range anxiety.
Speaker 1:You get range anxiety exactly. So would you see a future that would have a almost gas station type service at the dealership that you would say come refill, charge up and get some chips or whatever and some water and then be on your merry way to the next place? You would imagine that that integration would happen naturally, right.
Speaker 2:It is. That's happening already. What I think is going to happen is, as electric vehicles gain more momentum, you're going to see businesses anywhere that anybody parks cars putting in chargers that you basically put a credit card to and while you're in the store shopping, it charges the card and you pay for what you put in. Again, it's going to become a price thing is how much people are going to have to be aware of what they're paying for, the amount of power that they're putting in the cars. Our philosophy is that we provide free charging in front of the dealerships because we want you to hang around and look at the pretty new cars. Yeah, yeah, yeah. Porsche has with their new Taycan. All electric vehicle gives you three years of free charging at any Porsche dealer.
Speaker 2:That's why there's a requirement for having this supercharger put out front that will charge the car from 20% to 80% in about 15 or 20 minutes, so that people can come in, get a quick charge and get to 300 miles.
Speaker 1:Yeah, that's pretty. Yeah, I mean I would see that the most effective way to solve the infrastructure problem would be to just marry that service station and dealership together and say let's make the dealership more like a service station rather than make it its own point. Because if you drive anywhere in the US, you're going any major highway, there's a portion that has kind of dealer row and so if you're with your family and you're in the new E-Caravan or whatever E-Pacifica, you're pulling off to that location rather than waiting to charge at a new electric service station that they're going to be setting up and may or not, may or may not be setting up in the future what's interesting about that is is that there's an app that you can get on your phone that most of the ev people have, that tells you where your closest free charging is, no matter where it is.
Speaker 2:At our store in coral springs, we have a charger parked out front and we have people that pull in with all kinds of cars to plug in for a pre-charge. While they're sitting there, um, and they, they come in, get a cup of coffee and then, but you'll see, you'll see a leaf, you'll see a, a volt, you'll see a. Uh, you know, you'll see all kinds of cars there.
Speaker 2:And in fact, we had a car parked in one of the parking spots and one of the guys on the app gave us a little feedback get your cars out of the parking spot so we can use your charger.
Speaker 1:Yeah, that makes sense, jeez, do you see a place where you can buy, you know, windshield wiper fluid, cigarettes and you know, and a six pack of beer at a dealership in the future?
Speaker 2:normally parked for half an hour or more. The mall, um, you're gonna, if you've got free charging, people will come in and sit. You know, if they're desperate to find some electricity they'll pull in and park, but the dealership is is still going to be, a place to demo vehicles. Look at vehicles um service your, you know, when you have a problem, bring it in and we'll fix it, kind of thing. Do maintenance work and that stuff?
Speaker 1:But by and large I don't see the US is going to be the thing that's going to drive what that market is going to look like. Just Correct.
Speaker 7:Right, it's already started, though. In LA we were just there, we swapped house and cars with some friends of ours and they have a tesla and you could. They actually have parking spots now, like on the main streets, and all they're doing is they're breaking off the power line and they're putting a little box there and you can charge your. You know you can charge there and there you can start, like there you can buy into these two where you, where you can basically put up a spot. There's obviously permitting and zoning restrictions, but it's just so much easier, obviously, to tap into an electrical line than it is to dig underground, put in saying it's going to be tougher for service.
Speaker 7:When people's cars last longer, they don't have to get all the same things taken care of. And I don't know. I like the dealership idea, like you were saying, stop in here and kick it, but then, after seeing you know what I just saw there? It's like that's the future is that people are just going to have them. You know main, main streets off to the side and you can just park. You know eight in a row or whatever it is that's they're going to look like little parking meters.
Speaker 2:I mean, that's what they really do look like. They look like a parking meter with a cable hanging off of it and they're really easy to use. You walk up, you throw your credit card in front of it. It chip reads it, you plug in your car and you just pay. When you're done, you just unplug it and drive away.
Speaker 7:Exactly.
Speaker 1:So what? So it's what would long haul across the U S look like. Are you going into a neighborhood to charge up or are you going to a service station?
Speaker 7:No, they, I mean they have infrastructure now to go from East to West coast. You obviously have to follow specifics and again, like Paul was saying, the fear of not running out, but you just have to kind of stay on those highways Outside of that. Yeah, what does that look like? How do you get to podunk areas? You don't. You're still screwed.
Speaker 2:Well, you're going to see, in the rural areas it's going to take a much longer time to get the infrastructure in, because people in rural areas really have range anxiety, absolutely. I mean, john, if you could imagine down in West Texas where they don't talk about the amount of miles between cities or towns, it's how many hours does it take to get there? Yeah, from Amarillo to Midland.
Speaker 2:Yeah, so, but along major routes. You know, like Electrify America, which is Volkswagen's arm of electrification, they're investing billions of dollars, basically as part of the diesel gate issue, in building these charging stations, and that's where, when you're in a Tesla and you're driving and you need to get some power, it'll show you where all the charging stations are and which ones are free and which ones you pay, and it'll map the route out for you.
Speaker 1:Here's how you get from A to B and don't run out of juice stop as much as possible and whether that's you know a supercharger that does 15, 20 minutes, that you're filling gas and you're doing a bathroom break and buying a couple things or you're doing. That's going to happen. That momentum is going to happen somewhere and I'm curious to look at what the future is going to look like If dealerships are going to capitalize on that time and say, hey, by the way, do a test drive or whatever that looks like. Or you know, buy some chips and water and everybody take a bathroom break and then be on your merry way. That's the piece that I'm really interested about.
Speaker 1:It's like what is it going to look like five years from now? When is it going to look like 25 years from now? Because it's going to gradually turn the. You know that that cone is going to invert one way or another. It's going to say the. The amount of um fossil fuel vehicles out there is going to change to the lower percentage, but there's going to be something in between and a hybrid model throughout between now and then. That's going to look. That's going to be really interesting to look at it's going to take some time.
Speaker 2:Um, you know you, you read Ford and. Gm are going to be all electric and each model is going to have its own all-electric thing. Coming down the pike as the demand grows for charging and there's monetary reward for people to invest a little bit in the infrastructure, I think you'll see these charging stations popping up everywhere. Yeah.
Speaker 1:Yeah, it might be like those scooter models that you just have individual companies that create charging stations that people pay a credit card with and then there'll be a service station slash, car wash, slash, you know, convenience shop model, and then the dealers might have some piece of that. It's going to be interesting to see. Do you see a world where every single like in 25 years, the majority of service stations have invested in their infrastructure and created charging stations rather than gas stations? And they have. You know 30% of the vehicles going to gas and you know 70% of the vehicles going to charging stations rather than gas stations, and they have 30% of the vehicles going to gas and 70% of the vehicles going to charging stations. Is that a world that could be possible, or what does that look like?
Speaker 2:And personally I think you're going to see gas stations waning more like not being on every corner because you're not going to have the need, and you're going to see these charging little it's a kiosk or a meter.
Speaker 2:It looks just like a parking meter popping up all over the place that you can grab, whether you're there for for five minutes, ten minutes or an hour or parked overnight, because the car will will charge to its the point that it needs to be charged and shut the charging off and you pay for what you use. The thing with the electric car too, is that you know the cost per mile is much less with electric than it is with gas, so will the demand be there for fuel when everybody's going. I can buy this car at a reasonable price and it's much less to operate, as long as I don't have to drive 500 miles and make a bunch of stops. Yeah.
Speaker 1:Yeah, if you're not doing cross-country trips on a regular basis.
Speaker 2:Yeah, or you're not doing cross-country trips on a regular basis yeah, or you're not in a rural area. I think in the rural areas you're going to still see gas stations and internal combustion engines.
Speaker 1:Yeah, that's the conversation that you and I were having a couple years ago. It's like, what does it look like? You know the Google car or whatever that looks like, or the Apple car? That just is a you know four-wheeled bubble that comes, picks you up and then takes you to your places. Like, when is that happening? And the conversation went to. You know Marshall, michigan, where my family's from, is a town of 9,000 and has three dealerships in it. You know they have like a dial-up internet those.
Speaker 2:BNC markets. I think you're going to see, like when we did the project, we did a parking lot project out in California where we developed an 11-acre parking lot for off-site storage of vehicles and that long-term, that if the Uber model gets to a driverless vehicle, where you go to an app on your phone and you call up a vehicle and this bubble or whatever a car pulls up in front, the door opens, you get in, it takes you where you want to go and you get out, I think that in 10 years you're going to see that and it'll become a service. What do those cars do, or what do those devices do, whatever you want to call it, when they're not busy or they need to charge, yeah, when they're not busy or they need to charge.
Speaker 2:Well, if you've got a parking lot that has an automatic gate, the car could go to that lot, let itself in and I think you'll see inductive charging, just like you have inductive charging on phones, where the car pulls up over a pad and charges itself and whoever's operating the lot charges the car. And the cars are off the street. So I'm sure the city's not going to want these cars parked on the side of the road when not in use.
Speaker 5:They've got to have a place to go home oh that's a great conversation and the a really good person to talk with on the infrastructure lobbying side on that is tim jackson from the Colorado Auto Dealers Association. The city of Denver has been penciling that for about three years right now and they're way down the road of that exact concept that you're talking about. That he's been doing with the dealer body out there in Denver well Colorado because he's the CEO of the CADA. But Tim Jackson is well into those conversations, including DC.
Speaker 2:Excellent.
Speaker 5:So welcome, Gary.
Speaker 1:Good to have you, man. Hey, jeff, how's it going?
Speaker 5:Good, how are?
Speaker 1:you, good man, glad to have you.
Speaker 2:So, paul, do you think that there could be a world where that's a possibility? People that are in driving cars and people that are in the autonomous vehicles getting around. But I think that technology is well on its way to becoming more mainstream. I mean, you see now where you've got. You know, teslas are self-driving cars. Driving cars You're still required to be behind the wheel, but I believe that there's going to become some kind of a standard that all the vehicles are going to talk to each other. Bandwidth is going to get greater where all these things can take place and the safety of these vehicles will become more mainstream. And when that happens, or as that happens, you're going to see these things taking place. If you what's, what's the biggest cost to an Uber? It's got to be the driver, yeah Right. So if you can eliminate the driver, you've got a much better way of instant transportation.
Speaker 1:I mean how? How long do you think that we're? How far off do you think that we're from you? Know what do they call that level five autonomous vehicles that you, the bubble with four wheels that you walk into.
Speaker 4:What's today, Tuesday? Yeah, it's going to be a waste lot.
Speaker 1:Yeah, I'm just looking at the gas station market size in the US and it's $99 billion at the moment in 2021. And that's down from 2012 at the peak is like $150 billion market size, and so I mean, obviously something's taking a chunk out of it, and I think electric vehicles is going to be that way and I don't know what this curve looks like over, you know, the next 10 to 20 years, because that's where you know what's, I guess, applicable to our us and us being in the market for for those next 20 years.
Speaker 2:Well, it's going to become a. You know there's a. There's a tipping point where it becomes self-perpetuating. Where you've got enough infrastructure, the investment is there, there's a monetary return. They're more economical to drive. You've got manufacturers producing more content, say the different vehicles and more vehicles that are that are going to take this and I think it's going to. In the next 10 years it's going to become the mainstream. That you're going to see. Most everybody has an electric car, especially in urban areas. Yeah.
Speaker 2:You know the new cars that are coming out are are caught price right, very cost-effective. Volkswagen's ID four is a is a good example of that. That it's, you know it's a kind of a competes right with the same size vehicle in a gas car and is less to drive.
Speaker 1:Yeah, less to operate, yeah, absolutely. Yeah.
Speaker 1:Absolutely yeah. Yeah, the interesting thing will be like the vastness of the US market and non metro areas Right Is like the, as people call them, the flyover states is like if you're in Kansas or you're in Montana and what does the market look like? You know that's always the biggest challenge is, yeah, you can get, you know. You know you have gigabit fiber in San Francisco and Miami and New York, but you don't have that in the small rural areas of the US. It's like what is that going to look like over a long period of time? There's still places that have dial-up internet and what is that market going to look like over the long period of time?
Speaker 1:We see it within the dealership space all the time. You have dealers that are in the metro areas. If you're in South Florida, you know Texas, california, new York, you're implementing AI and you know you're pretty advanced in your operation. And if, because of the competitiveness of how, of what your peers are doing, if you're in, you know, a relatively smaller market or a B or C market, you're not going to necessarily have that competition. And the same thing I think applies to electric vehicles is it's going to be in the, you know, metro areas and the rural areas are going to be a little bit more, are going to be a lot later to adopt, and I think that's going to have a whole slow down the market.
Speaker 5:No, sorry, who is it?
Speaker 2:I was getting the oh, the other thing to remember. You know, we don't really want the manufacturers becoming the dealers Such thing as owning a Tesla dealership. Yeah.
Speaker 2:For you know the manufacturers. We want to keep a dealership structure. We believe, as dealers, that we provide as a selling dealer, as a as a uh. As a selling dealer, we provide value and making sure that it's the right product for you, that you get a fair price on the car and that we take care of you for service. Um, we think that's the best mode of of distribution. Um, because you know, as these other companies come in, they could put you out of business if you're not selling vehicles. Oh yeah, absolutely, If you don't have the product.
Speaker 1:Yeah, yeah. It gives all the it doesn't. It decentralizes the power if it's in the hands of the dealers rather than it being in the hands of the manufacturer, right.
Speaker 2:Absolutely.
Speaker 2:Yeah, if the manufacturers control the full pipe, you know, I guess, factory to consumer, absolutely the most part is what the stopgap that controls, that it creates competition and that competition creates a relatively more fair market, right yeah, so, getting back to if you're planning renovations or if you're planning a new dealership planning a new dealership, you really want to make sure that you've got enough future proofing for putting chargers in, making sure you've got enough power coming into the building, making sure you've got enough of the things the right lips so that you can service these. The manufacturers are also moving toward actually having battery containment buildings that you have to put on property. If they want to ship you a whole battery, they've got a place to drop it off and take out an old battery and or, if one of these things is compromised in an accident, that it's got a place to sit while they figure out how to discharge the battery. Because they've had a couple of fires in these things that are very difficult to lithium is kind of difficult to put out. Oh, I would imagine.
Speaker 1:Yeah, I can't imagine what the EPA regulations or whatever is going to look like for dealerships handling these.
Speaker 2:Well, as long as you're sending back what you're bringing in. That becomes the problem of whoever is making the battery or servicing the battery. Yeah. On the EV vehicles we have now. I've not had to or I'm not aware of anyone that's had to replace an entire battery unit. They have us take them out of the car, disassemble the battery, find the bad cell. They ship us a new cell. We put the new cell in. We ship the old cell back. Yeah, I mean, that's not an easy process.
Speaker 1:I mean, what type of level of job is that compared to? Is that like pulling a motor, or is that pulling out a drive?
Speaker 2:train. Well, yeah, so in a typical we're Audi and Volkswagen, so in a typical deal there the battery and motor assemblies come out as an assembly yeah and they're literally the bottom of the car.
Speaker 2:So that's why you have to have a wide lift so that you actually there's a table. You jack table underneath that, you lower the, the battery onto, um, and then you have you have to have a quarantined area where nobody's allowed to walk in. You've got a technician in a electric proof suit with electric proof gloves and a shield on so that if something does blow he doesn't get zapped, and um, basically, you take the motors off and then the battery has two or three different levels of things that come apart to getting to the root of where all the cells are based. You find you know you discharge the battery. Now you can work on it safely. You can take the old cell out, put the new cell in, you get it all wired up, start putting it back together with ours.
Speaker 2:You have to pressurize it with air pressure uh overnight, or for six or seven hours to ensure that the battery compartment is airtight so that water can't get in, and then you bolt all the mechanicals back on it and stick it back under the car and away you go. But it's a multi-day process and it takes a specially trained technician with special equipment to do that.
Speaker 1:It takes a specially trained technician with special equipment to do that. So do you think the EV technicians are going to turn into the way of kind of diesel technicians, that you have a small minority of technicians that are EV qualified rather than that being the norm right?
Speaker 2:Well're, we're sending people to school constantly. One of the things is that you've got to have a number of technicians available to to service the cars. I mean that's part of your training requirements. Is is what do you have for for that? Do you have? You know you have to have at least one, or if you're a large shop, you might have to have two or three. Technician turnover is always a chance for keeping guys and making sure that technicians are rare as hen's teeth now anyway. So if you've got good guys, you got to. You know you got to take care of them and keep them engaged, and the jobs have to pay well.
Speaker 1:Yeah, the crisis of the technician is vast and wide right, and the crisis of the EV technician is going to be even worse.
Speaker 2:Yeah.
Speaker 5:As these become more.
Speaker 2:But you know, as we get down the road, you know the the you also have to.
Speaker 2:Each technician ends up with his own protective gear, or pretty much his own protective gear with his own protective gear or pretty much his own protective gear, because you can't put mr five foot two in the suit for the six foot five guy, or vice versa yeah so you, you know, we find that as we get these guys trained, um and and there's plenty of training to getting them up to how to do it um, as they get to needing the equipment, you got to buy them the equipment to make sure that you've got that. So that's again part of the special tools and infrastructure that you need in order to do these things.
Speaker 1:What are you looking at, a setup for PPE on an EV technician? I'm sorry, say that again. How much are you looking at for a PPE for an EV technician?
Speaker 2:Oh, a couple grand, a couple two $3,000.
Speaker 1:Jeez, so besides having the you know 10 grand in tools you probably have to, the technician is going to look like, at an additional cost of about three or four grand, to have their own PPE, or the dealer has to provide that.
Speaker 2:Right, well, so far, the dealer provides all the PPE that we're using.
Speaker 1:Yeah, that's tough. That's a tough call.
Speaker 5:Yeah.
Speaker 2:So you know it's just how fast can you get these guys trained and how many are you really seeing? Like, so far we're not seeing a whole lot. I think I lost you, yeah.
Speaker 1:You're back, I'm back.
Speaker 2:So you know how. How fast are these cars going to become more mainstream and how many problems are you going to?
Speaker 1:see, that's kind of my question. These are more and more becoming computers, right Computers with big batteries and four wheels at the end of the day, and Microsoft and Apple have been doing this for 40 years at this point, ibm 40 years at this point, and there's still problems. So I don't really see, you know, there's no computer that's super reliable, that you don't have to turn off every once in a while, that you have to defrag the disk, that you might have to upgrade RAM, that you might have to pull a hard drive on, like how are they going to do this with rolling computers? Basically what it is. It's like how are you going?
Speaker 2:to take this in to reformat it and flash it. Yeah, you'll have software updates, but a software update's not going to fix a battery. You know those things. That's what I was saying earlier is that you're going to see more and more. You know the cars have a SIM card in them now and they're talking to the internet and you've got. All they need to do is download the update and run it, kind of like you do your. You know when you get an update on your phone.
Speaker 1:Yeah, and I think the this opens, this begs the question is like what does cybersecurity for that look like? It's like you can paralyze a police department by hacking into all of their vehicles and making them not start, or you kill every single vehicle.
Speaker 2:That's a whole other discussion it's a whole different bag of hair. Yeah, what do you do to secure these things? There's machines. Now I've seen where they walk up to the. They're within 10 feet of you. You push the button on your car. It grabs the code. Now you can get in the car and go.
Speaker 1:Oh geez. Yeah, I mean the more connectivity, the more entry points, the less mechanical something is, the more easily you can scale the mass kind of deployment of malware for it. Agreed, yeah.
Speaker 2:And there's no standard. There's no standard. That's part of the problem.
Speaker 1:There's no standard, yeah yeah, there's barely a standard now for dealership technology. Right for cybersecurity. I mean, there's some manufacturers that are relatively advanced in that world, but you know, the more that we're going towards electrification and technology, the more reliant you're going to be on some type of cybersecurity or some type of protection.
Speaker 2:That's a whole other realm of things to look at, that you know. But that's really going to have to come from the manufacturer and it's going to have to come from some kind of standardization. Yeah.
Speaker 1:Yeah, it's going to be more and more vulnerable every day. Just imagine driving down the road in your new Audi and then you get a bunch of pop-ups of selling you Slea, allison and Viagra right, getting spammed into your car.
Speaker 2:Well, you know you're driving down, somebody steals your car. If it's got OnStar on it, they can disable the car remotely. Now what happens when you're driving down the road? If you really wanted to do something to somebody. Cars have electric steering. Okay. Cars doing 60 miles an hour make a hard right.
Speaker 1:Oh yeah, absolutely you know, that's huge.
Speaker 2:Right. Or you know you have your phone connected to the car and can they get into your phone through the car to get into your personal, any of your?
Speaker 1:personal data.
Speaker 1:Yeah, and I think there's going to be a place that there's going to. There's going to be a decision that we have to make. It's like, just because we can doesn't mean we should, and I think, as far as national security, I think there's a big deal with that because if you have some type of coordinated attack, if maybe a police force has all have electric vehicles, or if you have government vehicles that are all electric, that you could potentially do something at mass scale without it's about minimizing the attack vector, I guess, as far as that goes, and putting all your eggs in that technology basket for efficiency or for, I don't know, in the name of saving money or being more efficient, it's going to create a whole new dynamic of problems that I'm going to be really interested to see. It's not like I can stop it or any of us in this room can really stop it, but I think we should start getting in front of it and say this is what the vulnerability of going down this road is.
Speaker 1:B-52 bombers are completely analog for a reason they're very effective. For a reason you can't hack into something that's completely mechanical. It's impossible unless you're a spy and you're, you know, doing something.
Speaker 2:And you're in the driver's seat.
Speaker 1:Exactly if you're in the driver's seat, like there's a reason why those things are so analog and you just can't do it right.
Speaker 1:You physically can't, there's no opportunity or no time to do it, so there's going to be something that's interesting to understand how they get access to that as the world becomes more technologically reliant. I agree, yeah. So, paul, what do you think that could be the two or three top things that people could take away from our conversation today? Just to prepare, not for 20 years or kind of the future of when Skynet becomes a self-aware and, you know, takes us all down. It's like what can they do in the next five years if you're building a dealership or you're in the process of doing a remodel? It's like what do you think something that tricks and tricks of the trade that people can do to prepare for the next, uh, you know, the following five years or the following 10 years to set themselves up for success rather than, um, you know, having to say crap. I wish I would have thought about adding, you know, a second circuit or the lift to well, I I think that to a build one you need to work with.
Speaker 2:If you're doing a new build, you need to work with your manufacturer to make sure that you've got a good understanding of the amount of vehicles that are going to be in the market for the next so many years. Have faith that the manufacturer is going to be able to put those cars on the road. Some manufacturers are very pie in the sky and want you to build huge mausoleums. You better have the business to back that or you're going to facilitate yourself into a nonprofit. Yeah.
Speaker 2:So make sure you build size-wise correctly. Yeah, so make sure you build size wise correctly. The second thing is is to make sure that, as you're designing it, that you one got a sufficient lift, because there you can go either way. With those where an in-ground lift is pretty much going to be, um, for an, you know, a current model vehicle, a gas engine vehicle, with the exception of. They do make in-ground lifts that are wide enough to do those, but they're very, very expensive and they take up the same amount of room as a as an overhead, but so doesn't, my mind doesn't, make a lot of sense to do that.
Speaker 2:Yeah, um, make sure you've got enough power, uh, coming into the building, or you've got enough infrastructure in the ground, even with extra conduit or whatever, to be able to pull power in the future should you need it, so that you're not digging up the road, coming in with underground wiring to your building and plan on having charging in very convenient spots. You're going to need chargers in the shop for cars during PDI and for servicing that are convenient to use and parking for your customers outside that they can come in and plug in. Um, either, you know, and, and you know, maybe have a snack bar that they can come in and visit with chips and coffee.
Speaker 1:Yeah Right, buy cigarettes.
Speaker 5:I don't know about buying cigarettes.
Speaker 1:Um. So, paul, what? What kind of um that don't? That's. That's, I think, really good advice to say be effective and flexible and and forward thinking to say I'm not going to necessarily do this now, but I'm going to put those you know six inch or 12 inch conduits to make sure that I can have power going through, coming into the property for whatever that looks like in the future and kind of future planning these things. And I know firsthand how you think and I've been there at the Blueprints and seeing you do that, which is brilliant. You said somebody's going to thank me later for doing this and I've seen you find those things as well. It's like, oh, there's a conduit here and somebody was thinking in the future and put these things here to kind of future-proof the dealership. And that's always a pleasant surprise to to to find Well, we, just, we just did that in Fort Lauderdale.
Speaker 2:We, you know, in 2015, we opened Audi Fort Lauderdale and um we ran the conduit with the wires, with the power out to the parking area, but didn't put the charging heads in.
Speaker 1:Yeah, I remember that.
Speaker 2:And this year it's a requirement, like if all Audi dealers have to have outside charging for customer parking. So you know, when we went out to okay, here's what are we going to buy for the charging heads to go in and open up the box and went everything's right here. Just buy the heads, bolt them on and wire them in.
Speaker 1:Yeah, that's, it's like.
Speaker 2:Rather than having to dig under the building and come up in the middle of a building to come out of the transformer.
Speaker 1:Do your future self a favor and think ahead. Yes, yeah, that's big. Um, yeah, I think that that's that that's really good advice is to start looking at thinking, you know, from a place of flexibility, to say what is the future going to require and how can I get as close as that target as possible? And i've've seen you do that firsthand.
Speaker 2:And if you're building a facility, you want to do the same thing even for your IT. Make sure you've got plenty of conduit for fiber and cable and copper or whatever else you're going to bring in, along with enough power, enough conduit to bring enough power into the building, if they're coming from the same place or not.
Speaker 1:Yeah, that's the. If you're building the dealership and designing it. I mean, I've gone from seeing some dealership builds that don't have an IT room and so you're obviously not thinking in the future and then to the other extreme, where you're setting your future self up for success with you and saying here's the IT room, this is where we're going to put additional drops and we're going to throw these cables here. We're going to put TVs in the service drive or in the service lane for update promise and super robust Wi-Fi. You make sure that the already delicate process of implementing new technology isn't hindered by a massive lift on the build or infrastructure. You know investment side. Right, that's correct. Yeah, that's huge.
Speaker 2:A little bit of planning and money now saves a ton of money in the future.
Speaker 1:Yeah, man, I'd say, yeah, I've seen it firsthand. Jeez, yeah, really yeah. So we got Kelly jumped in. Hey Kelly, how are you?
Speaker 6:Hey Lev, I'm good, how are?
Speaker 1:you Good, good, good. Welcome to Dealer Tech Tuesdays the Paul and John Show. Today we're talking about electrification of vehicles and what the future is going to look like. So, with Paul Jensen from the Cavalli Auto Group and uh, gary also joined us for a little bit we're going to have this on the podcast and record it to everybody to listen to in a future um, in the future date. So I'm really happy that you came. Came on. What's going on? How are you? How's your day been?
Speaker 6:Been good so far. You guys are talking about one of my favorite topics. I'm so excited.
Speaker 1:Good, good, good good.
Speaker 6:So do you drive an EV? I do not, so I used to work for Kia, and the car that I actually fell in love with was the Kia Niro which is an. Ev. It does have a PHEV vehicle as well. So one is EV, one is PHEV vehicle as well. So one is EV, one is PHEV. But I love that thing because there's one that the hybrid goes 50 miles per gallon.
Speaker 6:And two guys drove it cross-country, from California to New York and only filled up three times, three times in 3,000 miles. I was like floored. I did drive it from North Carolina to New York on a dealer trade. I was going to New York anyway, since I'm from there and my manager said well, since it's your deal, you drive it up. That's how they're getting the kind of price that they're getting on it. And, yes, the client knew it would have about 500 miles or so on it and it was on one tank and it was phenomenal, phenomenal, phenomenal vehicle. But I've been thinking about the Sorento EV and in the meantime, I do have a Kia K5, which it does not have a hybrid vehicle, where you can't get a K5 in hybrid. So that's what I have now. But I'm looking at a lot of different hybrids, including the Mercedes EQS, which I absolutely love the way that that thing looks. It is just a sexy vehicle in my perspective.
Speaker 2:But I'll go ahead and mute up there. Sexy vehicle in my perspective, but I'll go ahead and mute up there. Well, I think you're going to see a lot of the styling on these cars is going to really be a driving factor. A lot of the new full EVs that are coming out are just hot-looking cars to begin with.
Speaker 1:Yeah, yeah, I mean, I think that. Do you think that there's going to be a place where there's just two types of vehicles, which is going to be EVs and hybrids, that you have something that's, I think, the hybrid is around, is going to stay, has a lot? Is that everything is going to go from just straight gas to hybrid and then they'll be in the metro markets more towards hybrids and EVs than anything?
Speaker 2:Right, I think that's correct. You're going to see a lot of hybrid, because the hybrid gives you kind of the best of both worlds. You get your nice long range, good gas, gas mileage and you don't have that range anxiety yeah, yeah you know you can always stop the gas yeah, exactly, exactly yeah.
Speaker 1:And paul, I'm curious to see what. What do you guys? How do you guys handle receiving teslas in on trade? How does that dynamic work for you guys?
Speaker 2:um, we put money on the car and we charge them up and turn around and sell them.
Speaker 1:Do you guys try to sell them as a pre-owned or does that go straight to the auction we?
Speaker 2:have to sell them as pre-owned. We're not a Tesla dealer. We've taken them in trade several times across the board. Across the board. You just you know they have a value that you put on them just like any other car, and we clean them and make sure they're safe and plug them in and charge them up and turn around and sell them. I mean they're good used cars.
Speaker 1:Does Tesla have a used car program where they're buying out uh used teslas across the country, or are they only you?
Speaker 2:know I? I don't know, I would imagine they do.
Speaker 1:Um, my dentist is on his third and he just buys from them, so I'm sure that they've got some kind of a remarketing deal that they do yeah, that'll be interesting to see, like how evs and the straight-to-consumer model goes in the secondary market and after you know, they have this huge push of putting out ridiculous amounts of vehicles and then what is that going to do to the used car market and how the used car market behaves with Teslas. And, you know, giving them parts and getting them, you know, do the reconditioning for them. It's almost like they'll be. They have to deal with the dealer body, whether they like it or not, right, yeah? Hey.
Speaker 6:Acosta yeah. Oh, I'm sorry, paul, go ahead.
Speaker 5:No, no, go ahead.
Speaker 6:I was going to say. I don't remember whether it's in Texas or in Georgia, but I know that Hendrick Auto Group has put together a Tesla buying center where they're buying people's used Teslas because they can't sell new ones. Obviously right, but they're looking for pre-owned ones that they can sell and they're marketing it as a buying center specifically for Tesla. I just don't remember whether it's in Texas or in Georgia.
Speaker 6:I know it's one of the two, though, but I'll definitely find out for you, because there are and they're not the only one, there are dealer groups that are looking to maximize on the Tesla pre-owned market. Oh wow, Maximized on the Tesla pre-owned market.
Speaker 1:Oh wow, yeah, that's really interesting to see a large group like Hendrick to go to say, hey, I'm going to straight buy your used Tesla and then resell them and almost create a pseudo-Tesla dealership under you know, a used car Tesla dealership in Texas. Because they can't necessarily in Texas. Apparently they can't sell direct to consumers, so you have to. They have a roundabout way of legally purchasing a vehicle in the state of Texas because of the franchise.
Speaker 2:And then you have to purchase them out of state and they just deliver them in Texas.
Speaker 1:Yeah, exactly so you have to purchase them out of state and deliver them in the state of Texas, exactly so that's kind of what I was getting at is like what weird things are happening in the Tesla used car market and dealerships and how are dealerships capitalizing on that process? Because used cars is such a big piece of the automotive retail space is the secondary and tertiary markets.
Speaker 6:Yep, it's in Georgia. I just researched it. I looked it up, just wanted to give you guys the right place.
Speaker 1:Oh nice, yeah, Nice, All right, so we're about to wrap up, guys. If anybody would like to jump up and ask myself, Paul Gary or Kelly some questions, we'll be happy to answer anything that's bugging your mind.
Speaker 2:And or John. Do you have an email address that people that have questions can email in? Absolutely. And then we can always address them at a later date.
Speaker 1:Yeah. So the Paul and John shows. This is kind of I'll give a little bit of background. So Paul is one of my customers and I consider Paul one of my mentors, or, as Brad Paschal would call him, my car dad, kind of the guy that got me into the business, and we have regular conversations that are about a wide range of topics that I think are very constructive. So you know, on Dealer Tech, I host the Dealer Tech Tuesdays and we're going to have a recurring show called the Paul and John Show where we're going to put together technology operations builds, crazy stories that we put together. So if you're ever interested in asking us a question, you can send that question to podcast at vtechdealeritcom and then I'll print those out and I'll bring them in and Paul and I will kind of jump on those questions and get the or if you've got suggestions for topics.
Speaker 1:Yeah. Or if you have suggestions for topics, bring in awesome minds like Kelly and Gary and John to kind of tackle these things so we can tackle them together. That's why I love Clubhouse, because there's so much collaboration and I think it's us running towards the problem of the stigma that we have in our industry and it's an industry that I deeply love and I know that everybody that's on Clubhouse deeply loves. So, just trying to be part of that change and be better at what we do and kind of take away that stigma from this industry. So, with that said, I want to just say thanks to everybody and be better at what we do and kind of take away that stigma from this industry. So, with that said, I want to just say thanks to everybody. I think Michael is wanting to jump up, but you know we're at the kind of top of the hour, michael you have something for us?
Speaker 8:Yeah, thanks. Yeah, I've got an interesting tech that's in the auto industry. That's an antimicrobial solution, so it's a protectant. It's a tech in the way that. It's a technology, a patented technology, and what we're looking to do is mix in with others that are in the industry already and provide an additional revenue stream in the industry already and provide an additional revenue stream. I've had a little bit of barrier to entry in discussing it due to the fact that it's an advanced technology, so there's nothing else like it in the world, and we're appreciating the assistance around our residual surface protection.
Speaker 1:So Michael for the automotive space. If you'd like to pitch to dealers, there's a club on Clubhouse called Pitch Tank and it's on Wednesdays at, I believe, 955 am. So you can email Kyle Mounts here, yep, and he's the host of Contagious Auto, the Contagious Auto podcast, and you can give you know a straight-up pitch. You know, get all your stuff together and get a straight pitch to automotive owners, executives, other vendors like myself that are in there that will ask you questions. They'll give you a rating and you know you can drum up some business.
Speaker 1:But that's a great place to do that. It's called Pitch Tank and you can drum up some business, but that's a great place to do that. It's called Pitch Tank and if you look it up on, I think it's in our same club, the Automotive Innovations room. If you hit the little green house and follow everybody on stage and also follow the Automotive Innovations room, that information will be there. So that's a great place to pitch your product and get in front of the people that can make those decisions. Awesome, thank you. All right, anytime.
Speaker 8:All right guys.
Speaker 1:Well, we're at the top of the hour. No, anytime. Anytime we're at the top of the hour. Don't want to take anybody else's much more of anybody else's time. I appreciate everybody coming out. Thank you, paul. As always, you know, it's always fun to talk to you.
Speaker 2:John, thank you.
Speaker 1:Thanks Michael, thanks everybody for coming. This is going to be on Spotify, google Podcasts everywhere. Obviously, this is recorded. This is a recorded podcast. Anybody that wants to listen to the Dealer Tech Tuesdays podcast, jump in. Have great conversations with amazing automotive minds. We're trying to be podcast. Jump in, have great conversations with amazing automotive minds and you know, we're trying to be part of the solution and be part of the change that we want to see in the automotive space. Thank you, everybody and we'll see you next week. Bye, everybody.
Speaker 5:Thank you.