How Tariffs and EVs Are Reshaping American Dealerships with Andy Long, GM at Royal South Toyota

Andy Long shares the fascinating journey from high school teacher to dealer principal of Royal Auto Group, weaving together family legacy, automotive industry insights, and personal growth across three generations of leadership.

• Royal Auto Group began in 1969 when Andy's grandfather purchased a Chevrolet dealership in Bloomington, Indiana
• The company now operates three locations with six brands: Toyota, Mazda, Volvo, Subaru, Volkswagen, and Audi
• Andy initially pursued teaching before joining the dealership for a "one-year internship" that evolved into a lifelong career
• Car buying has transformed dramatically – from multiple dealership visits to primarily online research and communication
• New car sales operate on thin margins as a volume business, while used cars offer more profit potential due to their uniqueness
• Current tariffs are significantly impacting manufacturers, who are largely absorbing costs rather than raising consumer prices
• The electric vehicle market faces challenges despite government incentives – consumer adoption has slowed amid concerns about range, infrastructure, and cost
• Pending legislation in California could mandate elimination of new gasoline vehicles, creating major industry uncertainty
• Balancing work and family differently than his grandfather led to a pivotal confrontation that transformed their relationship
• Andy's grandfather's late-in-life spiritual transformation became one of his most meaningful memories

Episode Transcript

Speaker 1 (00:01):
You're listening to Risk and Resolve, and now for
your hosts, ben Conner and ToddHufford.
Welcome back to another episodeof Risk and Resolve.
I'm your co-host, ben Conner,with Todd Hufford, and today an
extra special guest, a reallygood friend of mine from my high

(00:24):
school days, the dealerprincipal with the Royal Auto
Group, andy Long.
Andy, thanks for joining ustoday.

Speaker 2 (00:36):
Yeah, good to be with you guys today.

Speaker 1 (00:39):
Yeah, I'm really excited just to have a
conversation with a good friendand to talk about the car
business.

Speaker 2 (00:49):
I love talking about the car business, so that part
is very easy.

Speaker 1 (00:52):
So we'll get to do that and we'll get to talk about
family business and then evenmaybe go into our friendship
group that we've warmly namedman Bash, and we'll explain that
here in a little bit.
But, andy, thanks for joiningus and if you wouldn't mind,
give us a flyover, if you will,of the Royal Auto Group and what

(01:15):
you're doing on a day-to-daybasis professionally.

Speaker 2 (01:18):
Okay, so the Royal Auto Group is a collection of
dealerships here in southernIndiana.
Bloomington, indiana, is ourheadquarters.
That's where we're located.
We started back in 1969 when mygrandfather on my mom's side
came up from El Paso, texas, andbought into a dealership in

(01:40):
Bloomington, indiana.
As the story goes, he wasactually maybe allocated or had
an opportunity to buy into oneoff of Fall Creek in
Indianapolis and he went upthere, took a look at it didn't
love that location, maybe asmuch and there was a gentleman
down in Bloomington named DaveMcIntyre who had a Chevrolet

(02:03):
dealership here and he wastrying to sell it and move back
up to the Indianapolis areawhere he had been a Chevrolet
dealership previously.
And so then my grandfatherpivoted and came down to
Bloomington love the town, lovethe university vibe, and so then
he bought Dave McIntyreChevrolet.
It became Royal Chevrolet in1969.

(02:23):
And Dave went up toIndianapolis and got back in the
Chevrolet.
It became Royal Chevrolet in1969.
And Dave went up to Indianapolisand got back in the Chevrolet
game up there.
So we've been here since 69.
And we grew from a Chevroletstore through at the zenith of
the empire, maybe it was 21brands and 13 rooftops across
two states 21 brands and 13rooftops across two states.

(02:43):
And then since maybe 2010, wefocused on Bloomington.
We used a partner model.
So he, my grandfather, came upin an organization that usually
had an equity partner as thegeneral manager, boots on the
ground, day-to-day operator, andso then he continued that.

(03:04):
So he had various dealershipswith a partner that was on site
that would run the day-to-dayoperator.
And so then he continued that.
So he had various dealershipswith a partner that was onsite
that would run the day-to-day,and the last 15 years of his
life he sold off his interestsoutside of Bloomington and even
inside Bloomington to those verydeserving partners.
And so we've got three rooftopsand six brands here in

(03:24):
Bloomington currently.
So we've got a Toyota store,which is kind of our flagship
building, a Mazda, volvodealership.
That's here on our south campusand then over closer to the
university on the east side oftown we've got a Subaru,
volkswagen, audi dealership so,um, so did you?

Speaker 1 (03:47):
obviously, there's a family tie, uh, with your
grandfather, um, but what was?
What was your journey?
Uh, as you went to college andthought about your career path,
like how did the dots connect toto finally end up going to
Royal?

Speaker 2 (04:04):
That's a fun story, one that I enjoy telling.
I'll give it an abbreviatedversion of that, which is
through my own personal failure.
So I, my grandfather, had fivedaughters and so it kind of
skipped a generation where hedidn't have.
Uh, none of his five daughtershad an interest in joining the
family business full time.

(04:25):
I think they probably allworked there at various times
throughout their lives highschool, and college,
post-college but none of themwanted to work full time there
and none of the son-in-lawswanted to work full time or
wanted to do it, for aftertrying it for a while, none of
them stuck, so it kind ofskipped a generation.
That's all going on in thebackground, but when I was going

(04:52):
to school and then when I wentto Taylor University, there was
no plan for me to to follow inmy grandfather's footsteps or to
join the car biz.
I didn't have any interest inthat.
I worked there every summerfrom when I was 12 all the way
through college, so I wouldusually do a few weeks to a
month in.
Bloomington, where I would workas a lot porter taking out the

(05:12):
trash, washing cars.
The joke was that I learned howto smoke a cigarette down to
its butt without ashing it asingle time, while also washing
a car, and that was like thetrue test of if you were a great
lot porter, if you could dothat.
In the 90s and early 2000s,which I mastered, which maybe

(05:33):
was part of my career path Iexhibited some real talent for
washing cars early on, takingout the trash.
I went to Taylor and had aninterest in teaching and so I
played sports.
Taylor is a real small school sothey let people play sports if
you have a desire and I reallyliked that and so I thought, hey

(05:56):
, I'm going to be a teacher anda coach.
And so I graduated with anEnglish education degree,
secondary for middle school andhigh school, got my
certification, got my teachinglicense.
But I did my student teachingin IPS Indianapolis Public
School.
And that was very differentthan my own education background

(06:18):
, which was both public andprivate, but in a suburb, not
the city, in a little bitdifferent environment.
And so I thought, hey, if Icould teach there, I can teach
anywhere and I'm not intimidatedby whatever the tough
educational environment might be.
But they ran me out of Dodge sofast and that was a really

(06:43):
eye-opening experience.
I thought I had a lot of answersas a young teacher and I did
not have the answers for some ofthe questions that were being
asked in the IPS district andthat gave me real pause.
And so I was like, man, I don'tknow what I'm going to do, but
I don't think I want to be ateacher.
And so I took the LSAT maybe,was going to go back to law

(07:06):
school, and at that time mygrandfather kind of slid over
and was like, hey, you know,what you could do is you could
do a one year internship at oneof our dealerships in
Bloomington, earn some money.
It'll look good on your resumefor law school and you don't
have to go right back to school.
You just finished school.
You don't want to get back inthe classroom right away, so

(07:28):
this would be kind of a goodopportunity to just do something
different for a little bit.

Speaker 1 (07:31):
And I said okay.

Speaker 2 (07:33):
I would be happy to do that.
I've worked in variousdepartments, like I said, all
growing up, so I was kind offamiliar with the dealership
world.
I moved to Bloomington, Istarted working full time and
they kind of moved me aroundwhere I started in central
office and I saw a couple ofdifferent departments, and then

(07:54):
my primary duty at that time wasthat we were just starting to
sell cars using the interwebs.
This was brand new, and so wewe didn't really have a process
for that, and I was wellqualified because I could type
with both hands.
I remember I uh, I replaced, uh,a gentleman named Alan who

(08:18):
would would smoke with one handand he would type with one
finger, and that was to then andhe was like the internet guru
because he had he held thatmantle before I got there.
And so I remember when I gotthere, like my first couple
weeks, like I would like typewith both hands and like I
didn't need to look at thecomputer or the keyboard because
I was an english major and I,you know, I could type a bunch

(08:41):
of words per minute.

Speaker 1 (08:42):
You were a whiz.

Speaker 2 (08:44):
They thought that was black magic and even Alan was
like you got to take my job, I'mgoing to go do something else.
This isn't going to work, so Idid that for a year.

Speaker 1 (08:55):
You can't fire me, I resign, right, yeah, he saw the
writing on the wall.

Speaker 2 (08:59):
Good guy.

Speaker 3 (09:02):
Technology comes at you really quick, just like
right now.

Speaker 2 (09:04):
I think if I went back to the sales floor I'd be
way out of touch, right.
So we wished Alan all the best.
He was a good dude, but yeah.
So I did that for a year and atthe end of that year I really
enjoyed it more than I thought Idid, and it had elements of a
lot of things that I wasinterested in.
It was different.
Every day You're dealing withpeople.

Speaker 3 (09:26):
There's some theatrics involved.

Speaker 2 (09:27):
I was like theater.
I was on the debate team ormock trial team in high school
and had an interest in likepoint, counterpoint and not
argumentation but persuasion,and so I liked the day to day.
And so then he asked me.
My grandfather was like well,hey, if you want to stick around

(09:48):
, you can.
Your internship is done.
If you want to join full time,we've got a spot for you.
And I said, yeah, I would liketo do that.
So I spent five years workingat our East side location, which
at the time was a Nissan,volkswagen, audi, subaru,
lincoln, mercury all in the samebuilding, which I think we had

(10:11):
the most franchises all in onebuilding in the state of Indiana
, probably in the Midwest, andso that was my upbringing.
For five years I worked at thatlocation doing sales on the
digital side the.
Internet world, which wasevolving every year, and then a

(10:32):
position became open at theToyota store.
So I was promoted and placed asa sales manager at the Toyota
store.
And that's like the guy ifyou're negotiating on a car
dealer, if you're trying to buya vehicle, when the sales guy is
like, well, I don't know, Ihave to go, let me check with my
manager.
I was that guy.
I was the manager that theywould go check with and I was

(10:54):
the guy that would come out andtry to give you reason to buy
the car from Royal today versussomeone else at some other time.
So that was my role for aboutseven years, from 2010 to about
2017.
And then I kind of moved into apseudo executive role where I

(11:18):
was the general manager.
I wasn't locking up every night, that was someone else.
That was my protege.
I wasn't locking up every night, that was someone else that was
my protege, a guy named Mikewho kind of took my spot.
And then I learned full timefrom our business partner who's
still here, a guy named Brad whoworked closely with my
grandfather, and then so Ilearned from him over the last

(11:41):
several years and then in 22,when my grandfather passed away.
At that point I was the de factodealer principal, making the
decisions on an executive levelday to day, and so then that
title went to me and I was thedealer principal and was able to
buy the majority of shares andbecome the dealer principal,

(12:04):
majority owner at the Toyotastore.
So, and that brings- us totoday.

Speaker 1 (12:10):
All the way to today.
So back when your grandfatherasked you hey, or told you,
asked you, I don't know what itwas, but why don't you come work
?
Asked you, I don't know what itwas, but why don't you come
work?
And this internship thing Wasyour grandfather the kind of guy

(12:35):
that he knew that was the hook,or is he the guy that was just
like?
No, that was just the offer.
He had no intention of it goingfurther than a year.
Yeah, that's a good question.

Speaker 2 (12:42):
I think he was a very good salesperson.
I mean, clearly he didn'tfinish high school, he didn't go
to college, he was veryself-made.
He started selling cars when hewas in high school and then did
that full time and kind of lefthis educational opportunities
and started selling cars at avery young age and turned out to

(13:04):
be really good at it, and so hewas a natural salesperson.
I think maybe he saw some ofthat in me and the joke goes is
that none of the son-in-lawswanted to work for him full time
because he was a really toughdude to work for.
So he came from nothing and hebuilt a very successful business
, but he was a tough dude towork for, very exacting, he had

(13:29):
high standards, was demanding.
His secret to success was justto work longer and harder than
most of his competitors.
And you mix that with a goodsense for business and
opportunity and risk and he didreally well.
But he was tough to work for.
So the joke was that he had tomellow out and skip the
generation.
He realized, hey, I can eithersell it to a larger dealership

(13:53):
entity or sell it to a rival, orto sell it to somebody, or I
can have my family join me inthis, but I'm going to need to
maybe downshift just a bit andbecome a little bit more
approachable as an owner and asa boss.
And so, looking back, I thinkthat he was trying to give me an
on-ramp into the the family biz, but he didn't.

(14:17):
He certainly didn't present itthat way at the time.
It was very much just like hey,if you want to, you want to do
this one thing for a year, noproblem, no strings attached.
But then, behind the scenes,talking to some of the, we've
got two partners who have beenhere since the 90s and both of
those gentlemen I work for theywere my direct bosses when I

(14:38):
started and they were both like,oh no, he was definitely
telling us, like, let him, youknow, let him come in later if
he needs to leave for a weekendor if he wants to take a car
home under the like I have gotto move some furniture.
Let him take that SUV withfancy wheels, which I did almost
every weekend.
I found a reason to like borrowa car from the dealership.

(15:01):
So he was definitely trying toget, uh, pique my interest in
the business.
So and then.
But it was a very soft offerand it was like, hey, if you
want to do this, no problem.
And then at the end of thatyear it was like, hey, what do
you think?
Um, and I really I did.
I loved it.
I loved aspects of it for sure.
So my wife bethel will we?

(15:23):
We joke about this now, but itwas kind of tough at the time,
not kind of it was exceedinglyrough, but so I worked kind of
like a nine to five, no weekends, during that internship year
and during that year I wasdating beth, who's now my wife.
We had met in high school eagles, fly higher and heritage
Christian.
We went to different colleges,started dating about halfway

(15:46):
through and had been dating along distance.
She lived in Indy and I livedin Bloomington, so I went home
every weekend or she would comedown and she would actually stay
at my grandparents' house, andso then I was.
We got engaged during that yearand so she had only we'd only
been kind of in the same state,dating each other when I had a

(16:07):
pretty flexible schedule and Ihad my weekends free.
So when we got back from ourhoneymoon I had committed to
joining the car businessfull-time and my grandfather was
like hey when you're.
You know, because you're comingon full-time now you're going to
work a traditional car scheduleand I was like sure that sounds
great.
And that's like bell to bell,which is kind of a euphemism in

(16:30):
the business for like you openat eight and you stay until we
close the dealership at eightand you lock the doors up and
you leave when we close, andevery Saturday until we die,
because Saturday is a big volumeday, all of our customers are
off work so they can come in anddo some shopping.
So usually that's a biggerretail day for us, important in

(16:50):
the car business.
So we went from seeing eachother every weekend to when we
got married and we're back fromour honeymoon.
I was like, hey, by the way,I'm going to work a different
schedule than you've just seenfor a year and that's going to
be every day, eight to eight andevery Saturday until we die.
And so that was a very abruptadjustment for a young married

(17:13):
couple.
But that was what was expectedin our field, in the Royal biz.
It was just hey, if you'regoing to be a manager or on the
sales team, you're going to justwork a ton of hours and that's
the difference.
That's what we expected andthat's what I did.
So that was really difficultbut looking back, I'm
appreciative of that time that Ikind of put in my dues and I

(17:37):
missed a lot of social stuff.
I missed a lot of kid stuff.
We've got four kids now so thatwas difficult, difficult but
probably needed, and it's givenme a real appreciation for the
sacrifices that a lot of ouremployees make every day.
Uh, being part of our team,we've tried to to curb the
expectations a little bit, alignthem more with the

(17:59):
family-friendly schedule, so wedon't work those hours anymore,
but it's still a lot of work andso I appreciate people that put
in that time for the Royalorganization and I'm probably
more appreciative because I didthat for a while.
I did that for, you know, along time 11 years.

Speaker 3 (18:21):
Well, maybe if we added an attorney to this call,
we'd have an attorney and aninsurance agent and a car
salesman, which would be themost unlistened to podcast ever.
I was reflecting on thesimilarities of really your
business and our business.
We represent carriers, yourepresent manufacturers.
We're out for the interests ofour customers.

(18:42):
You're out for the interests ofyour customers.
We're out for the interest ofour customers, you're out for
the interest of your customers.
But it's that delicate balancebetween meeting the needs of the
customers and servicing, in ourcase, their policies and, in
your case, servicing theirvehicle.
Give us a breakdown of thecomponents of a traditional
dealership, from parts toservice, to new to used, and
maybe give us percentages on,maybe, where some of that
revenue is coming from.

Speaker 2 (19:10):
Those are good questions.
So a lot of people aren't awarethat each dealership is its own
franchise.
So maybe similar to aChick-fil-A or what you guys do
is you represent those carriersbut you're your own business.
Similarly, I represent thebrands here in Bloomington like
Toyota, mazda, volvo, but Idon't work for them.
I'm not an employee of Volvo.
I run a dealership, a brick andmortar business.

(19:31):
We have our own customer baseand I am the authorized seller
and servicer of those brands.
So I'm the only Toyota guy intown, I'm the only Volvo, only
Subaru, volkswagen, audi, mazdaand so my goal is to represent
those brands, the six that I'vegot here in Bloomington.
In my market area, which is alittle bit larger than

(19:55):
Bloomington it stretches up to,you know, south of Indianapolis
for some of my brands and west,over almost a terahertz down
south past Bedford.
So if somebody wants to buy oneof the brands that I've got,
I'm going to represent thosebrands.
I try to keep the vehicles instock for them to come and do

(20:15):
research, test drive.
They can buy one here whenthey've got a problem
mechanically or if they justneed to maintenance their
vehicle, they could do that here.
We've got a full line servicedepartment, parts department,
and we also have a body shop ora collision center.
So if you get into an accidentand your insurance carrier says

(20:36):
you could fix it with OEM partsor that's OEM is kind of like
the slang in our industry forthe official brand you could do
that here as well.
So but we may sell um at our twolarger dealerships.
We may sell a hundred a monthright now is kind of our, our

(20:59):
benchmark.
That was higher pre COVID, forsure.
Uh, a good month.
We may may sell 120 or 150,both new and used combined, and
the brands will have peaks andvalleys.
So you may have a really goodSubaru month and Toyota may be
down a little bit.
Or Mazda may have a great monthand Volvo may be a little slow.
So that varies.
We try to shoot for 100 to 120new and used every month and we

(21:24):
may be servicing 50 to 60 carsevery day.
So we may have 50 to 60customers coming in saying I
need an oil change or I popped atire or something even larger,
like hey, I think I've got aweird electrical problem with my
older Toyota and then, we fixthose and then we may see
another.

(21:46):
It varies in the body shop, butit could be as many as 50 to 60
in a month, sometimes less.
So all those things are workingday to day and we're trying to
interface and one of my jobs,along with my partner who's our
executive VP, is just to try tomake sure that we're
communicating within all thosedepartments to try to service

(22:07):
those customers.

Speaker 3 (22:09):
I've always heard that used cars are a bit more
profitable to a dealership thannew cars.
Is that truth, or do you needto debunk that?

Speaker 2 (22:18):
It can be true.
So for a long time ourdealership sold more used cars
than new.
Traditionally we were a usedcar.
That was one of our focuses,and so we would sell one and a
half used, sometimes even twoused cars for every new that we
sold, and pre-COVID for sure.

(22:39):
New cars is a volume game.
You want to sell as many as youcan.
I've got the exact same car,usually within maybe a few
different options, as acompeting dealership in Columbus
or in Greenwood, indiana,they've got a red Camry, I've
got a red Camry, and so it's whocan provide the best service,

(23:02):
give the customer the bestexperience and often who can
offer the most competitive price.
And those factors all kind ofcome together.
But that means that there's acutthroat amount of competition
between all the dealershipstrying to sell a customer that
new car and then after thatwe're hoping to get that
customer back for service.

(23:22):
We want them to do their tiresand their brakes and their wiper
blades here.
We want to care for thatcustomer for as long as they own
that vehicle really low,because it's just the market
drives it down.

(23:44):
There's a lot of competition andused cars are a little bit
different in that if you tradefor a really nice, you know, two
year old Toyota Sequoia withlow miles.
There's probably not anidentical one anywhere close,
and so they're kind of likefingerprints or snowflakes in
that every used car is a littledifferent, and so it's very hard

(24:09):
to say, hey, I'm interested inthis car that you've got on your
lot.
I can buy the exact same car ata different dealership.
We would counter and say, well,it's not going to be the exact
same car, it doesn't have thesame pedigree, ownership history
, maintenance records, thecondition is a little bit
different, the price isdifferent.
So it's usually a little biteasier to hold gross profit on a
used car.

(24:29):
You're still going to pricewithin market and I think across
the board we make way less thancustomers assume that we make.
We think, oh, we're makingthousands on every transaction,
but often on a new car the frontprofit may be a negative number
and that you're just gettingthat customer here and then
hoping that you can establish arelationship and keep that

(24:52):
relationship for years and tryto make it back in that way.

Speaker 1 (24:57):
Andy, is there, like on the new cars, because you
also have to manage arelationship with the brand,
right?
So is there incentive then that, hey, we, we may not make money
on this, Obviously we want tocare for the customer over time,
but we also want to show the,the, the brand, that we're able

(25:19):
to move vehicles and like howdoes that is that true and does
that help you?
And like what does that looklike?

Speaker 2 (25:24):
Yeah, so it's.
I wouldn't say pay to play, butwe've invested, you know,
millions of dollars in a brickand mortar facility.
Using our Toyota store as anexample, we had a big renovation
where we spent almost a milliondollars just on the front
portal that is that kind oficonic white tiled rectangle

(25:46):
that goes over our front door.
So there's a lot of expense torepresent these brands in our
area, and they also dictate whatour sales efficiency should be,
based on all sorts of metricsthat they get from registration
data, from the state and theirown sales data.
So they come up usually with anobjective saying hey, we think

(26:08):
that you should be selling thismany new Mazdas every month, and
then it's our responsibility tostay within that acceptable
range.
So we want to sell as many aswe can, but we certainly we have
an obligation as part of ourfranchise agreement that we're
going to represent the brand ina sales efficiency or compliant

(26:28):
manner, and so that means thereis a ton of pressure to hit our
objectives, to sell theappropriate number of cars, to
be sales efficient in our area,and that usually comes at the

(26:51):
expense of well, hey, if wewaited longer, if we waited for
the exact customer who wantedthis car we may be able to sell
it for a higher profit or ahigher transaction price.
be able to sell it for a higherprofit or a higher transaction
price, but we would rather giveup the profit, get the customer
report the sale and then kind ofmove on from that.
So the new car game is for surevery volume oriented.

Speaker 3 (27:13):
What percentage do you sell within the footprint of
your market versus, obviously,online?
You're attracting people fromout of your market.
You're even probably shippingthem.

Speaker 2 (27:23):
You may not even talk to the customer in real life,
yeah, so that's changedremarkably since I started in
the business, which was it wouldhave been maybe unusual to
correspond with someone via theemail.
We didn't even have textingreally when I started, but it
used to be that you would calland maybe you would call two or

(27:43):
three different dealerships.
I'll call the guy in Greenwood,I'll call a guy in Fort Wayne,
I'll call a guy in Bloomington,find a salesperson, try to get
some information about what thebest price would be on a
particular car, and then youmake a trip and you may make two
or three different stops atvarious dealerships, look at
them, collect the information,then make a final decision.
So the shopping process was alot longer over the last 20

(28:07):
years.
It's really changed and thecustomers can do so much more
research online.
They can go to these veryrobust OEM websites where they
can get all sorts of informationconfigure a car, get pricing,
get availability.
They can see in terms of Toyota, they can see exactly what I
have in my parking lot just inreal time, the same as I can,

(28:31):
and so there's a lot moreinformation out there.
That means less trips.
So it's very uncommon that acustomer would go to two or
three dealerships.
Usually that's all done viaemail or texting and you know
what you're trying to get andyou usually have a pretty good
idea of what you're going to payfor it before you would drive
over, whether it's drive downthe street to your local guy or

(28:51):
drive across town becausethey've got something different,
or drive from here to St Louisbecause they've got an
exceptionally rare car.
So I, as a small town, half ofmy business is repeat and so
I've got maybe a largerpercentage of customers from my
PMA or primary market area thatI focus on because I'm a small

(29:13):
town Indiana guy and I don'thave as many people coming from
out of state, but we'll shipseveral cars every month to
customers that we never meet inperson.

Speaker 3 (29:23):
So roughly, what percentage do you think is out
of your PMA, sold out of yourPMA?

Speaker 2 (29:27):
We'd like to sell maybe 70% of customers that are
here in my backyard or in myarea, but there could be 25 to
30% on a given month that wehappen to have the car that
they're looking for.
And it's much easier now thanit was 20 years ago to just say
hey, I can call this guy, I'm inMemphis, tennessee, but I know

(29:51):
that this guy will sell me aproduct.
I can trust that process and hecan even ship it to my driveway
.
I don't have to spend, you know, a month searching for the car.
I don't even have to spend myweekend driving up there to get
it and then drive it back.
So that happens more frequentlynow than it did, for sure, but
we still try to focus above 60%for sure of my own customers.

Speaker 1 (30:16):
There's been seemingly some shakeup in the
car business over the last fewmonths and even recently, one
being tariffs and and obviouslywhen the tariff conversation
comes up, the auto industry iswhat gets zoomed into.
So I was just curious to getyour take on kind of what your

(30:41):
visibility has been to tariffsand how that's impacted you all,
or perceived impact for you all.

Speaker 2 (30:50):
Yeah, that has been a wild ride, and so I want to be
careful to say hey, we'reneutral on that subject.
We're not advocating for oragainst the idea of tariff.
That's a bigger picture thing,but I can speak to how specific
auto tariffs are changing oraffecting the retail world and

(31:13):
how consumers would interactwith my dealership in the face
of these tariffs.
I would say that I probablydidn't know much about or hadn't
paid attention to import exportstuff.
I know that we represent a lotof international brands.
We've got German brands, we'vegot Japanese brands, I have a
Swedish brand and so I know thatthese cars are coming from

(31:35):
somewhere.
But each of these brands thatwe would have have a
manufacturing presence in the US, but they also import cars
globally from all over the worldand I probably didn't have a
great understanding of how allthese components came and fit
together and got assembled andthen were shipped to a final
assembly place until theconversation about tariffs came

(31:58):
up.
But it is on the top of all.
Of our only partners are reallygrappling with this issue right
now and how it's affecting theirprices on a short term.
None of the brands that werepresent have changed their
pricing structure to consumers.
So none of them have said, hey,we got to pass this tariff on

(32:23):
to our consumers.
We're going to raise the retailprice of the car that we're
selling.
Some of the brands that werepresent have said, hey, we are
racking up huge tariff bills,like multi-million dollars,
every single day that we're openfor business, every single day

(32:44):
that we're open for business.
We cannot sustain that and weneed to change our wholesale
arrangement or our wholesalepricing with the dealers.
So and it kind of it comes inand out of focus as some of
these tariff deadlines come andgo, or there's an extension or
there's, you know, an exemptionthat comes up.
That's been really difficult tonavigate as we're often

(33:05):
ordering two to three to fourmonths ahead.
So we're trying to plan on well, what's our volume going to be
like in August or October andhow many cards do we need to
have on order for those times?
But I have a brand that werepresent that has changed their
wholesale arrangement andthey've said hey, we're the
price point with the tariffs.

(33:27):
If the tariffs go into effecton May 3rd or continue to go
into effect, that price, if wewere to add it to the price of
the car, it would make the carunsellable.
No one's going to buy a carthat suddenly is 25 or 50
percent more expensive.
They'll just wait and so none ofthe brands want to kill their
sales and so none of them havechanged the consumer facing

(33:50):
price.
But they are all absorbing hugetariff bills and some of them
are beginning to pass those onto dealers saying, hey, we can't
do this alone.
We're going to change yourmargin structure, so you're
going to need to participate,you need to take less, have less
profit, if any profit, on thefront end of these sales,

(34:11):
because we can't change theretail price that's set but we
can't continue to pay thesetariffs.
So that was in development justlast week and we're kind of
waiting.
There was some language thatcame out earlier this week about
Trump alleviating some of thetariffs that are automobile
facing.
So we'll see how that plays out.

(34:32):
But it's literally been like,you know, day to day.
There may be something thatchanges.
I went to a big conference forone of the brands I represent
down in Texas.
They hosted the national dealerbody, so almost 300 dealers and
I know that this is a grade A,primo executive level
presentation with a slide deckand audio visual that they had

(34:56):
created probably months priorand they were scrambling last
minute because there had been abig tariff announcement 48 hours
before our meeting and so thewhole tone of the meeting was
kind of changed in that.
Okay, well, we've got this newinformation about how tariffs
are going to apply to ourspecific brand because we're

(35:17):
bringing in cars.
This car is not made here inthe US, so it has been a wild
ride.
If I was going to guess, Iwould say I just cannot imagine
tariffs continuing in this way.
At some point the dam will breakand some of these manufacturers

(35:38):
will say, hey, we have got toraise prices because we cannot
absorb these tariffs on our own.
And at that point, if thatchanges, then I think that the
administration will react reallyquickly because that's a direct
increase to cost to consumers,a tariff that goes across, and

(36:02):
then all these brands are like,yep, we have to, we're gonna
have to raise the price of thistruck by 25.
That would slump the autoindustry and I don't know that's
not.
That's not good for me, forsure.
But we're often thought of as avanguard of the larger economic
trends, and so nobody wants tosee a big slump or a recession

(36:24):
in car buying because that'sgoing to have trickle down
effect.
So if I had to guess, I wouldsay something gets resolved,
maybe before that happens.

Speaker 3 (36:31):
You've got a lot of different brands.
I'm thinking Subaru having goneto Purdue.
Obviously they've got a bigfactory up in Lafayette.
Toyota's got a presence inIndiana.
Do you kind of start wargamingwhich brands might fare better
on that because they'reassembling more in the US?
Does that become part of theconversation you guys have?

Speaker 2 (36:50):
Yeah, we've thought about that.
Or another wrinkle to that waslast month when they announced
these tariffs and said, hey,like these are going to go into
effect, these tariffs and said,hey, like these are going to go
into effect, there's going to be25 percent import export on
these cars coming in, even forbrands that assemble vehicles,
or a good chunk of theirvehicles.

(37:10):
Like Toyota builds a millioncars in the US but they also
import, you know, not quite thatmany, but a good chunk.
So they're doing both.
But there was some question oflike, hey, if the tariff date is
X date, like early April, ifthe tariffs go into effect that
date, everything that gets intothe US before then would be

(37:33):
pre-tariff and would not betariff.
So the gamble was, hey, would wewant to try to get a hold of a
large shipment of cars, way morethan we would need, gambling
that if there was a tariffincrease, all the other cars
that were coming in after thattariff effective date would be
seven, eight, $10,000 moreexpensive than the one that's in

(37:53):
my parking lot.
As it turned out, that hasn'treally happened and the
manufacturers have absorbedthose.
But there was definitely somestrategizing about hey, should
we make some big play and inhindsight that would have been a
big risk, and I think we didn'thave the appetite for that, and
so we just kind of stood patand said, hey, we're going to

(38:14):
buy and sell within marketwithin our normal time frame and
we'll participate, I guess notas a gambler that's out ahead of
that curve, but just witheverybody in the normal group of
wait and see.
And as it turned out, it waskind of much to do about nothing
so far.

Speaker 3 (38:31):
So far.
So basically, you're not buyingthe quote unquote futures on
the Toyota Highlanders and theSequoias by loading up the
bathroom shelves with rolls androlls of toilet paper or, in
this case, tens of thousands ofdollars of cars.
You're just taking it as itcomes.

Speaker 2 (38:48):
Yeah, millions, and millions of dollars of inventory
Millions.
So it's a big gamble and no, wesaid no thanks.
We had the opportunity, likefrom Volvo as an example,
they've got a lot of vehiclesthat are in port, which means
they've been unloaded from theboat but are waiting in a giant
logistics parking lot, and so itwould have been possible to say
, hey, let's take 50 EX-90s or50 XC-60s and bring them in.

(39:15):
Even that's way more than wewould need for a two month,
three month period.
But so we did not do that, andit turned out that that didn't
save us or lose us any money, soholding fast was probably the
right strategy in that case.
It's hard to time governmenttariffs, as it turns out, nobody
has the algorithm for that yet.

(39:36):
Yeah, absolutely, andy, youmentioned something to me.
Absolutely.

Speaker 1 (39:39):
Andy, you mentioned something to me Gosh, I think it
might have been even yesterdayabout a California law that
passed.
That is just interesting forthe car business.

Speaker 2 (39:57):
Can you share a little bit about that?
Yeah, this is man.
This has been the mostinteresting topic outside of
tariffs this used to be thetopic that everybody was talking
about but the role of BEVs, orbattery electric vehicles, in
the US marketplace.
And to give just a little bitof backstory before I talk about
the CARB states or the onesthat are following California
and their emissions policiessince Tesla started so the 2010s

(40:23):
, that decade or maybe evenearlier, as they got going very
small company but saw tremendousgrowth and they were able to
bypass the traditional dealernetwork, which I'm not a huge
fan of.
They are selling direct toconsumer.
So just like you buy your iPhone, you can go online and buy it.

(40:44):
You can go online and buy aTesla.
They also have brick and mortardealerships, but they're all
corporately owned.
They don't go through afranchise dealer network like
most of our legacy manufacturersdo, and so that was very novel
and is a threat maybe to someonelike me who has a traditional

(41:04):
distribution type role for theproducts that I represent.
But they saw a huge growth asEVs were coming up and they
really dominated that originalEV space.
So even up until the last fiveyears they had huge market share
.
Five years they had huge marketshare and they were seeing, you

(41:25):
know, like and we're talkingabout small, small numbers like
they had point zero, 1% of themarket share point, you know,
point 5%.
They've made it up to 1%, whichis a huge number of, you know,
16 to 18 million cars sold.
They could sell a quartermillion cars every year, but
they saw huge growth on verysmall numbers.
And all of these other legacymanufacturers noticed this and

(41:48):
said, hey, the growth is goingto be in EVs.
We have got to get into the EVgame.
And so if you look at thenumber of nameplates of electric
vehicles from 10 years ago,they were like a handful Tesla
dominated, you know, nissan hadan EV, mitsubishi had a weird EV

(42:12):
at the time but real smallnumbers.
Now every brand that sells a carin America just about offers
some sort of completely batteryelectric vehicle for the US
market and the US market withChina.
Those are the two biggestmarkets globally.
So if you have a presence herein the US, that's what's
required to be a major player onthe global stage.
You've got to be able to sellcars in the US.

(42:32):
We've got a ton of car buyers,same with China.
You've got to be able to sellin that market.
And so EV saw this huge increasewhere everybody's scrambling to
get an EV and they're doublingsome years on a very low
percentage, doubling their spacein the market.
And so everyone was justbetting the farm that EVs were

(42:55):
going to continue to have thisjust meteoric growth, growth.
Now there are, last count, over30 different nameplates of
electric vehicles that you couldbuy, and so the market is
saturated with different optionsand at some point over the last
few years the market kind ofturned and there was this weird

(43:19):
sentiment there's hugecompetition.
Everybody's got an electricvehicle.
None of them go more than 300miles, most of them go 200 and
change.
They're all fairly expensive,so they're way more expensive
than a traditional Prius oranother hybrid vehicle, a Ford

(43:40):
Escape hybrid.
They're more expensive thantheir hybrid counterparts.
They're usually very expensivebecause the R&D and the raw
materials needed to make thebatteries, and so there was this
weird slowdown where peoplestarted paying more attention to
like.
Okay, hey, like, what are theadvantages of an EV, does it?

(44:00):
have the range I need Are thesegood cars?
And it's kind of become a focalpoint or a debate within the
auto market.
Those who follow it would belike, hey, what is the role of
an EV in our market?
Do we have the infrastructureto?
If everybody joined the EV cluband we were all driving an

(44:22):
electric vehicle, does our powergrid support that?
Do we have enough power in ourgrid to support, you know, 10
more million EVs on the road?
And so there was some debate andthey kind of started slowing
down.
There was market saturation andthen EV has just tumbled the
last couple of years andconcurrently with this, elon has

(44:47):
aligned himself with Trump, andso what was like a very cool
and hip, maybe liberal and youngtech brand has become kind of
lumped with a very politicalvibe.
Probably unintended for peoplethat bought a Tesla in the last
couple of years.
They probably weren't thinkinglike, hey, this is going to be

(45:08):
the equivalent of a MAGA hat orsome sort of political statement
, but that's kind of what it isright now, and so Tesla has seen
dramatic drops in sale.
All other EVs have also slowedway, way down, and that market
right now is really beingpropped up by these very big

(45:30):
government rebates.
You can get a $7,500 governmentrebate if you lease an EV
across the board.
Just about everybody qualifiesfor that, and so that makes a
$60,000 car darn near 50, makesa $50,000 car very affordable
for the average consumer, and sothere's a lot of turmoil in

(45:54):
what would happen if thatgovernment and the current
administration has alreadytalked about maybe pulling back
from that and taking that orreducing that, that EV credit.

Speaker 3 (46:05):
But to your point.
So like, all right.
So what that's?

Speaker 2 (46:07):
the.
I've spent too much timetalking about the backstory of
the EV market.
But California and some othermaybe more liberal leaning
states that were faster to adoptthe EV market have said hey, we
want to do our own emissions,tailpipe emissions standards, so

(46:27):
we want to set our own limits.
And California is such a bigstate, just like the US is a big
market globally.
California is a big state inthe US and so manufacturers
kowtow to what California wantsto do because they got a ton of
people there that buy cars Hugemarket, you got to be able to
sell cars there.
So over the last couple ofdecades they've been like hey,

(46:49):
we'll set our own tailpipeemissions and we're going to try
to make it stricter than thegeneral US.
So to drive a car in Californiait's got to hit a certain
requirement.
That's often way different thanIndiana, and so this month

(47:09):
California is going to be votingon a state bill that would
essentially phase out oreliminate gas cars.
So they're trying to say hey allthe way up to 2030, 2035, the
percentage of EV cars that theOEMs, that the manufacturers,
are going to be able to sell inour state go up every year until

(47:33):
they're 100% no hybrids, no gascars, no internal combustion
engines, no gasoline by a datethat's not too far off in the
future.
Those mirror and to me that'scrazy talk, because as a market
we're nowhere near that.
We don't have a car that can go400 miles, yet there's no way

(47:56):
that an EV fits every individualdriver.
They don't fit long haultruckers, yet they don't have
that technology.
The infrastructure to driveacross country is barely there.
If you don't have access to acharging system at your house or
in your neighborhood or at yourworkplace, where are you going
to charge your car?
So there's a lot of wildlogistic questions that we have

(48:17):
to answer before we wouldmandate hey, you're not allowed
to buy a gas car anymore or youcan't sell them here brand new
in California.
But they're voting on that thismonth in California and there
are 11 other states thatbasically mimic whatever
California does.
They've kind of formed acoalition and they're all going
to do the same thing.

(48:38):
So New York, a lot of theNortheast states in the Pacific
Northwest have all kind ofbanded together and say, hey,
we're going to do our own laws,our state laws, in relation to
how vehicle manufacturers cansell new cars in terms of the
emissions that they produce, andso it's maybe from a good place
.
Hey, we want to reducegreenhouse gases.

(48:59):
But we're kind of we're jumpingto start a little bit and we're
saying, hey, we're going tomandate that you have to buy an
EV by 10 years in the future,when maybe the market isn't
there quite yet.
People aren't ready for that.

Speaker 3 (49:15):
So that's what's happening right now.

Speaker 2 (49:17):
And it's.
There's so much other newsheadlines going on in the market
that I don't I'm not aware ofthat, probably outside of my
industry.
And so I know about it becauseI'm getting internal memos and
briefs from the brands Irepresent saying hey, you should
be aware of this, this shouldbe on your radar.
But I don't know if people inmy that I go to church with know

(49:41):
about this, because it's notsomething that people are
yelling and screaming about.

Speaker 3 (49:45):
But that's what is absolutely crazy, and that's
happening this month and wouldhave huge implications, right?

Speaker 2 (49:52):
So it's going to either penalize all these, these
car companies, maybe with a$20,000 per vehicle sold penalty
, so you'd rack up huge bills.
You wouldn't sell cars inCalifornia, you'd miss out on
that market.
Very, very unstable in terms ofhow you plan for that.

Speaker 1 (50:13):
What a wild energy conversation around that.
Because it might be an emission.
I'm not an energy expert by anyany stretch of the imagination,
but I know it takes energy tocharge a car.
So, um, you know, maybe you'reyou're solving one problem by

(50:35):
perception and just creating awhole nother issue, because I
don't think california wouldever be able to get the energy
to support that.
And so what would you do inthat environment?
And does that kind of a betjust force people just to leave
the state?

Speaker 2 (50:52):
Yeah, there would be some big questions for, like,
could a brand in the US surviveif you're not selling cars in
California and New York and thePacific Northwest?
I mean maybe, but that's a hugechunk of market share.
So that's why, even if they'rewhat, I would think those are
half cocked ideas, those are notfully baked yet.

(51:14):
They maybe come from a goodplace, but you've not.
The market isn't ready for thattype of legislation where
you're dictating what a customercan buy.
But yeah, we can't ignore thembecause that's a lot of market
share that those statesrepresent.
So one of the brands that Irepresent, toyota, was caught a
bunch of flack over the lastfive years for not being

(51:36):
aggressive enough in the BEVspace.
So they weren't bringing BEVsto market.
They didn't have plans to bringmore.
They have one and that's it sofar.
And that's it so far.
But they believe and I can kindof parrot that because I think
that's the best way for themarket would be hey, give
consumers a choice.
Do you want a gasoline engine?

(51:57):
Do you want a hybrid?
Do you want a plug in hybrid?
Do you want to be EV?
Do you want even a hydrogenfuel cell vehicle, which they
offer out in California?
So there are different avenuesthat a customer can take, based
on their own driving habits andwhat they need.
So I think that's maybe abetter way.
Hey, give customers choice.
They'll choose the one that'sthe best, and if you make a

(52:19):
great product, they'll buy it.

Speaker 1 (52:21):
That's right, free market.

Speaker 2 (52:23):
Yeah, but mandating and saying, hey, you have to buy
it or you can't make those carsgasoline cars after a certain
date, whether the market's goingto buy your product or not, is
wild.
It is and I can say that someof our slowest selling and
post-COVID was just an absoluterush.
Everybody had PPP money andinventory was small because the

(52:49):
factory shut down and there's apsychological trigger for
American buyers when you say youcan't buy something, that
that's all they want to buy, soyou're like don't tell me I
can't buy.

Speaker 1 (53:00):
Don't tell Americans what to do.

Speaker 2 (53:01):
I'm going to buy that car, no matter what.
And you're like you could justwait a year.
And they're like, nah, I'mgoing to buy it right now.

Speaker 1 (53:06):
End of the free baby.

Speaker 2 (53:10):
Don't tell me what to do, and so inventories are
still struggling to get back towhere we were pre-COVID.
We're not quite there yet.
Some of the brands like Honda,toyota, lexus aren't close.
We're still less than 20 dayssupply on the ground.
We finished with an 11-daysupply.
That's really tight inventory,really nuts compared to

(53:33):
pre-covid, but uh yeah, there'sjust.
It's been a wild ride inventorywise and trying to figure out
hey, how do we plan for thefuture?
So customers that are lookingfor bevs and are getting these
big rebates right now you canget a heck of a deal on a bev
because they's some of theslowest selling models out there
, right?
So the shine is kind of off.

(53:55):
There's a reticence, maybe kindof a wait and see, on BEVs
right now, and so whileeverybody offers them, they are
often the slowest selling, mostheavily discounted models in a
brand's lineup.
And so there's this weirdjuxtaposition where the previous
administration and they weresubsidizing this.

(54:19):
They were saying, hey, we haveto create these rules.
We've got greenhouse emissiongas rules that are going to
eliminate gasoline-powered carsby some date in the future and
in the meantime, we're going topay everybody a big chunk of
money to buy this car.
Maybe you hadn't previouslythought about doing an EV, but
we're going to give you $7,500if you buy it and you try it.

(54:42):
These are huge market factors,bigger than any disrupting
factor in our market that I canremember.
This is bigger than maybe theinternet.
Is that, hey, you can getalmost 10 grand of free money if
you buy this car that maybeyou're not ready to buy or we

(55:04):
want you to try it?
So without that, we'll see.
But a lot of these brands Salesare still slowed.

Speaker 1 (55:08):
Even with that, sales to try it.
So without that we'll see.
But a lot of these brands Salesare still slowed.
Even with that, sales are stillslowed.
So, it probably should betelling us something.

Speaker 2 (55:15):
And the final thought on that, and I can keep going
because this is so fascinatingto me.
But so right now, all thesebrands are still actively, right
now, bringing new EVs to market, because it takes three or four
years to R&D a car and then tolaunch it, and so they've
invested billions of dollars tobring these EVs to market, and

(55:39):
I'm currently demoing an EV.
They're cool.
I like EVs, I think they'rereally neat, but I've got access
to a charging station here atwork, so maybe it's easier for
me to drive one.
But there are brands that arebringing these EVs to market
right now brand new stuff, evenin the midst of this very I

(56:00):
would call it an EV slump.
They've had this in the worksfor three years and there's no
stopping it.
They're bringing it to marketeven though they know it's going
to struggle to sell in the USmarket and in Europe.
So we're in the middle of thatright now, where it's too late
to go back, and there'll be moreEVs that are scheduled to

(56:20):
launch over the next couple ofyears that are going to be money
losers for some of these brands, who have spent billions of
dollars to develop and bringthem to market, only to find out
that the market has radicallychanged and that the buyers that
they thought were waiting arenot waiting for those cars.

Speaker 1 (56:38):
Well, maybe they're the ones that are going to be
lobbying the Californialegislature to get that thing
passed then so they can sellthose cars.

Speaker 2 (56:45):
But I think there's a split allegiance there.
There's what the market woulddictate and what you can dictate
to the market, and if you're onthe other side of that coin,
you want there to be some sortof incentive, either your
company or your consumer, to buythose EVs.
There's got to be something.

Speaker 1 (57:02):
Yeah, I mean, they spent four years building so
they could recognize that pot ofgold at the end of the rainbow.
So whether it's there or youcan force it to be there, it
doesn't really matter.
Maybe from their perspective.

Speaker 2 (57:15):
They got to move that hill somehow.

Speaker 1 (57:19):
I know we have maybe 10 minutes left.
There's a couple of things Idid want to make sure that we
discussed and I wanted to spendsome time talking about your
grandfather, mr Royal, and Iknow you kind of gave us a
little bit of just somecharacteristics of him and his

(57:41):
business acumen and just how hejust understood business and was
a tough, tough man.
Um, but you had, you had theblessing honor of working with
him for, uh, a decade, uh,actually probably more or less
like 15 years.
What were some of yourtakeaways in working with your

(58:03):
grandfather of lessons learnedor just other things that, uh,
you really want to share aboutyour experience and working with
Mr Royal?

Speaker 2 (58:14):
Yeah, well, that's a big topic.
I was very fortunate to workwith my mentor every day, so by
the time I got into the businesshe had some trusted partners
two of those we still have whodid a lot of the day-to-day
management for him.
And so when I was coming up,one of the things that he would

(58:36):
like to do is that he would showup to the dealership and he
would come to the sales tower.
A lot of our dealerships had aphysical office.
In one of them we actually hada tower that was elevated over
the showroom and one of them weactually had like a tower that
was elevated over the showroomand it was kind of like where
the sales managers would hangout and have their pcs and and
do some of their paperwork andcommunicate with the sales guys,

(58:57):
and he would go up there and hewould just kind of set up camp
and the joke was that whoeverthe junior sales manager was at
the time would would literallygive him the chair.
You'd have to go like work in adifferent office while he was
hanging out in your chair atyour desk at your pc.
But he just wanted to likerelate to.
Hey, this reminds me of.

(59:17):
I saw the same thing in 79,when, when gas prices went
really high, or I saw this inthe 80s when the the income tax
went up, or whatever the casemay be.
So he loved to tell storiesabout experiences that he had
had in the business throughouthis career.
And so one of my favorite thingsand I was very fortunate to be

(59:41):
able to do this, because he letme do it, but kind of collect as
an oral historian, stories fromhis past, and he was very keen
on doing that over the last fewyears of his life, when he was
essentially retired and duringCOVID, he took that very
seriously because he had somehealth issues and so he didn't

(01:00:02):
leave his home to come to workhardly at all.
So I would go there every dayand try to talk with him for an
hour, give him an update on whatthe dealerships were doing, and
during that time he would relaystories about, you know, when
he was a semi-professional racecar driver or when he bought out
his first partner or when hebought his first import store.

(01:00:26):
So that was far and away themost important aspect of our
relationship, was not nearly inthe day to day of like, hey, how
do you do this, or how do Iwork with this customer, how do
I work with this manufacturer?
But big picture stuff,nostalgic memories that he
wanted to share, that he thoughtwere important enough to pass

(01:00:47):
on.
So I was very fortunate to beable to do that for several
years and then during COVID Idid that almost every day and I
really that was super valuablefor me.

Speaker 1 (01:01:00):
So that was like it sounded, like he got to a point
where he was trying to impartthe business on you, which was
more than just how many new carsare we selling?
What are the metrics in theservice department?
Yeah, it was bigger than that.
It was the thing of 50 years orhowever long you did it for.

Speaker 2 (01:01:22):
Yeah, it was like that book.
I think we, if we all grew up inIndiana I think it was required
reading fourth or fifth gradebut the giver where you know the
premises, like this old guy,has collected all these memories
for a society and then hepasses them down to one
designated, you know, receiverof all these memories.

(01:01:44):
And I kind of felt that sameway where you know he wanted to
tell me a story about aninteraction that he had with a
factory higher up and how itspoke to what he thought factory
relations should be.
But you know, it's a story from30 years ago and he still
remembers it really clearly andthinks that it has significance.
So I was very fortunate to beable to take on all of these

(01:02:06):
memories.
And then I'm trying my bestwith some of our younger guys on
staff, guys and gals.
How do I distill all of thesememories and stories that he
shared and then give them to ouryounger employees in a way
that's meaningful to them?
How do they learn from theseroyal stories from way back in

(01:02:31):
the day?
Because there's a lot ofsignificance and information and
helpful precedents that comefrom those, and so that's one of
the things that I try to spendsome time on and try to flow
that information down to theyounger generation.
And I'm older now, older now,I'm in my forties and so I'm not
that younger generation anymore.
I'm definitely, uh, on theolder side, and so now there's a

(01:02:55):
group of people that areyounger than me that I think
it's important to try to connectwith the founder of our
dealership, who many of themnever met in their lives.

Speaker 1 (01:03:04):
What are some uh, what are some other moments that
really stand out to you as likejust you know, mr Royal,
moments that you're like I willnever forget when.
What are some of those moments?

Speaker 2 (01:03:20):
Well, I've got two, one's more personal, maybe not a
business, not as much business,but one of them is he fired me,
so we got into a disagreementabout what the work life family
balance should be at thedealership and he had lived his
entire life under the premise ofif you don't work so hard,

(01:03:46):
someone else is going to comeand steal your business.
Or if you let your foot off thegas for a minute, your business
is going to come and steal yourbusiness.
Or if you let your foot off thegas for a minute, your business
is going to go downhill, maybeforever.
So he, that was like ingrainedin him.
And you know he had, he hadfive daughters, he had a huge
family and he, he did all ofthis with a really rigorous work

(01:04:06):
schedule and probably and Ithink that all of this with a
really rigorous work schedule,and probably and I think that
all of my aunts and my mom wouldall say, yeah, he plays, he
loved us.
He loved us by providing for us.
We did not see him at schoolfunctions or sporting events.
He didn't go to church withthem.
He was focused on business.

(01:04:26):
So he would come home.
He would sometimes cook in theevenings for them.
He loved to on business, so hewould come home, he would
sometimes cook in the eveningsfor them.
He loved to cook, loved togrocery shop, but that was how
he showed his love for them isby provision, by providing for
them through tons of hours ofthe dealership.
And so then I think my familyethos is different and that

(01:04:48):
family was more important.
Being there with our family,with my kids, is more important,
or it looks different.
And so we got to it in a prettybig disagreement the biggest
one that we ever had about whatdoes that look like and can you
succeed in business by balancingfamily and work in a different
way than his generation had,family and work in a different

(01:05:09):
way than his generation had.
And at the time he said, nope,that's, there's no way to do
that.
You got to go.
Your, your radical ideas don'thave a place in the Royal group.
And so he fired me.
And then, uh, I actually Itried to give my two weeks
because I said, hey, if we can'tcome to some sort of agreement
where I'm not locking up thedealership every night, I cannot

(01:05:30):
work here I've got four kids.
I've got.
You know, two of them came homewithin 60 days of each other.
So I went from two to four in aperiod of about 60 days and it
was bonkers at our house and Ineeded a different balance and
he was like there's just not aplace for that.
So I tried to quit and he saidI don't need your two weeks,
you're fired, we?

(01:05:50):
We thought about it for uh,maybe three or four days.
He kind of came back and saidhey, don't try to sell your
house, we'll, we'll, we'll workit out and we'll try to figure
something out.
So then he that was kind of thegateway to him saying look, I
trust you enough that I'm goingto allow you to run the
dealership very differently thanI did, in terms of you're there

(01:06:12):
every day, you're the oneclosing up, you're the one
locking the store, and that'sjust how it is.
I know that he did not agreewith me even until his dying day
.
He was probably very nervousthat I was taking this very
different approach to trying tobalance.
What does family and work lifelook like within the auto retail
business?
But he trusted me enough to saylook, you're going to sink or

(01:06:35):
swim.
Those are the decisions thatyou're going to make and it's
going to affect our dealership,but you're making them, so I'll
allow you to do it.
So that was a big deal.
I remember that.
And then, on a more personalnote, he was not interested in
spiritual things or organizedchurch or religion.
He had a bad experience growingup in Texas and so he kind of

(01:07:00):
had a cynical and jaded view ofchurch, although his wife went
to church, was a huge supporterof their local church for 60
years the same one and so he wasthe de facto provider for this
local church, even though hedidn't like church.
It would say that he wasn't abig fan.
But when he was 88, he calledme one night and said Andy, I

(01:07:26):
want you to know that I became aChristian.
I asked Jesus to be the Lord ofmy life.
I admit that I need a savior.
I can't do it all by myself.
And I just wanted you to know,and that was something that I
had been praying for forliterally my entire life, and it
was a huge surprise to have ananswer to prayer like that, but

(01:07:51):
one that I will always remember,and that was a huge deal.
That was at the end of hisworking career, and so he had
maybe more time to reflect.
But that brought us closer in away that I didn't think I was
going to experience in my life.
So those two memories areprobably bookends of the the

(01:08:22):
royal legacy and maybe changedhis opinion on self-sufficiency
towards the end of his life andrealized he needed Jesus, he
needed a Savior.
He couldn't do that by himself.
He had been self-sufficient solong.
So that was a big change, andso I think about the balance

(01:08:46):
between those two and I thinkabout both of those almost every
day.

Speaker 1 (01:08:52):
That's incredible, you know.
I think about thecourageousness of that
conversation between the two ofyou.
You know, I can only thinkabout what, the what the wives
were saying behind the scenesfor level heads maybe to prevail
.
Um, also, what kind of occursto me too is like just to think

(01:09:13):
of, like at the end of his life,and just that mr royals, like
one of his best friends, endedup being his grandson, you know,
and doing like life together.
Like that's pretty incredible,you know, and just what, just
what a interesting thing tothink about a 40, a 40, actually

(01:09:35):
a 30 something at that time andan 80 something being like buds
.
That's really cool, andy.
Thanks for joining us.
A couple of things before we goReal quick to go real quick.

Speaker 3 (01:09:50):
Ben Sure, annie.
When I think about that story,I can't help but get a visual of
my favorite movie, which isSecondhand Lions.
Do you know that movie?

Speaker 2 (01:09:58):
I do.
I'm familiar with that movie.

Speaker 3 (01:10:00):
You are him, and there's actually physical
resemblance to the actor in themovie as well, where you know,
of course, the, the, the nephew,if you will, or the great
nephew goes and lives with thetwo old guys, which is
essentially what you did.
You live with your grandfatherin his business and I just can't
help but think that the twomemories you have is of him

(01:10:21):
firing you, but then, ultimately, I think he fired himself.

Speaker 1 (01:10:26):
Yep.

Speaker 3 (01:10:27):
Yeah, fired himself as the leader of his own life.
So what a great story.
Thanks for sharing it.

Speaker 1 (01:10:32):
You just set the record straight.
You mentioned being at collegeand you know playing sports and
since it was such a smallcollege that anyone can play,
but and I think we probably needto put the link in the show
notes but do you not hold theworld record for the most amount

(01:10:54):
of goals scored in the leastamount of time in the soccer
program at Taylor University?

Speaker 2 (01:11:01):
Well, they don't keep great records but I'm probably
a candidate for the quickestpair of goals scored in a soccer
home match, for sure.
And it just so happened thatthe the finest, flukiest moment
of my athletic career, because Iwas a career-long bench warmer,

(01:11:22):
uh, but happened to have thisfunny, you know fortune smile of
me on that day.
Then I had it on film, which mywife laughs about, because I do
have a tendency to pass on thatlink, uh, and talk about glory
days.
And I've got it on film whichis more than a lot of people can
say they can only talk about Icould show them.

Speaker 1 (01:11:41):
So that's right.
That's right.
How many goals did you score?
Appreciate it.
So you scored two goals in howmany seconds?

Speaker 2 (01:11:49):
It was 30 seconds real time Game time.
It was only maybe a few seconds.

Speaker 1 (01:11:55):
So two goals in 30 seconds real time.
That is epic.
We'll put the link to YouTube,the YouTube link on the show
notes.
So we'll have to have you back,cause we didn't even get to
cover man bash and whatintentional friendship looks
like.
So we'll have to.
We'll have to talk about that.

(01:12:16):
But, uh, we usually close theepisode, uh, with two questions,
um, and the first one being, um, what is a risk that you have
taken that has changed your life?

Speaker 2 (01:12:32):
I think the risk was going into the auto business.
So that wasn't a stated goalwhen I went to college or even
when I graduated, and that wasvery different than what I
thought I was going to be doingand that was a big risk at the
time for me.
What I thought maybe was kindof settling for something that

(01:12:52):
you know I wasn't planning for.
It wasn't as prestigious Ithought as getting a degree or
getting a graduate degree orgoing back for more schooling,
and so that was a very differentpath than I thought I was going
to take and it was a risk.
I didn't know if I was going tobe good at it or would like it
or would find fulfillment in it.

(01:13:12):
So a huge life altering risk,as it turned out, that has
served me really well and I'mvery blessed to have found a
career field that I really enjoy.

Speaker 3 (01:13:27):
Andy, your second question and last question is
what is left yet unfinished,that you have the resolve to
complete?

Speaker 2 (01:13:35):
Ooh, that's a tough one.
But one word or theme that hascome up a lot in my professional
career has been legacy.
So I'm carrying on my family'slegacy, mr Royal's legacy.
There's a lot of pressure thatcomes with that to maintain it,

(01:13:55):
and so at this stage in my lifeI'm interested in how do I not
only carry on my family's legacy, but how do I establish my own
legacy?
How do I lead the RoyalAutomotive Group in the next 20

(01:14:15):
years, in the next 30 years orhowever long the Lord will allow
me to do that?

Speaker 3 (01:14:20):
Very cool.

Speaker 1 (01:14:22):
Well, andy, thanks again for joining us, and to all
our listeners, thanks forjoining us again for another
episode of the Risk and Resolvepod.
We'll catch you next time.

Speaker 3 (01:14:35):
Thanks for tuning in to Risk and Resolve.
See you next time.