Used Car Only List, UAW Takes a Beating, Gen Alpha Influencers

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We’re coming in hot after an insane ASOTU CON as we dive into Carvana's recovery in 2023, the UAW's setback at a Mercedes plant, and how Gen Alpha kids are shaping their parents' buying decisions.

Show Notes with links:

• Automotive News’ second ever Used Only List reiterates that 2023 was a pivotal year for used-vehicle-only retailers, with CarMax still in front, Carvana recovering its position despite numerous challenges, and some other players falling off the board.
  • CarMax tops the list again, selling 765,572 used vehicles, down 5.2% from the previous year.
  • Carvana sold 312,847 used vehicles in 2023, down 24%, but focused on profitability.
  • Vroom and Shift Technologies faced significant setbacks, with Shift filing for bankruptcy and Vroom winding down operations.
  • DriveTime Automotive saw a 7.2% increase, selling 110,027 used vehicles.
  • Sonic Automotive’s EchoPark increased sales by 15%, selling 73,676 vehicles.
  • Carvana CEO Ernie Garcia said, "We were not super well positioned to handle all of that change, nor were many of our peers."
    
    
    
• The UAW faced a significant setback as 56% of workers at the Mercedes plant in Alabama voted against unionization, marking a blow to the union's efforts to organize more Southern facilities.
  • Over 90% of the factory's 5,000 eligible workers voted, with 56% opposing the union with Mercedes officials actively campaigning against unionization, presenting their plans to address employee concerns
  • Mercedes worker Melissa Howell said, "We have the company’s ear, for the first time in a long time."
  • Another worker, Rick Webster, said, "The No. 1 issue for me is a better work-life balance."
  • The defeat is a major setback for UAW President Shawn Fain, who has revitalized the union with a combative approach.
  • The UAW plans to continue its $40 million organization drive targeting various factories, including Hyundai and Toyota plants.
  • UAW President Shawn Fain said, "While this loss stings, these workers keep their heads held high. We fight the good fight and continue forward."

• Gen Alpha, children aged 8 to 13, may not be the foremost generation on every brand’s radar yet, but it’s time retailers start thinking about them and their interests. Here are the numbers according to a new survey conducted by DKC’s analytics group:
  • 95% of Gen Alpha parents learn about new products or brands from their child.
  • 49% of these parents’ purchasing decisions are influenced by their child’s opinion.
  • About 90% of Gen Alpha children find ways to make money through chores, allowance, and online selling.
  • 91% of parents say their children love to shop, with 92% finding “interesting new products.”
  • Top retailers for Gen Alpha kids include Walmart, Amazon, Target, Nike, GameStop, Five Below, Shein, Costco, Dollar Tree, and Sephora.

Hosts: Paul J Daly and Kyle Mountsier

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Episode Transcript

Paul J Daly (00:22):
Monday, May 12, we just spent a week with hundreds
and hundreds of you. But todaywe're back in the saddle, it
feels really good. Talking aboutthe used car only list, UAW
taking a beating and generationAlpha influencers, the people
really want to know, back to it.
We could do a week of recapshows, which is the problem
right now, what's good? Do Iactually proper recap is in

(00:45):
order this year, actually,

Kyle Mountsier (00:48):
I am, like, I know that our team is getting
in. And we've got a little bitof like, it's gonna take some
time to get our hands around allthe content and pull together
all the panels and do themulticam cuts and all that
stuff. But man, there's somesessions that I heard about that
I couldn't go to that I'mexcited to just like, grab some

(01:09):
popcorn, get a little drink, andjust sit back and watch. So
yeah,

Paul J Daly (01:14):
I know, there's, that's the hard part is you you
go and you see so much, but youmiss so much. But we kind of
have been known to hit therecord button constantly. So if
you came, thank you so much tothe event, if you didn't come,
you should check your emailinbox, because there is an email
that we sent out yesterday, thatincludes all of the photos from

(01:35):
our Nashville team, a wholelibrary of photos, so you can
find yourself find your friends,post them, we were basically
like, these photos aren't ours,these photos belong to the
community that showed up. Socheck your inbox, because when
we sent it like Sundayafternoon, within like a few
minutes, we had a 51% clickthrough rate on that sucker. I

(01:56):
want these jokers you'll see,you

Kyle Mountsier (01:59):
know, over and over last week, there was this
sentiment, and this is what Iwant the automotive community to
continue with is that when youaligned heart set mindset, the
understanding the pursuit of abetter customer and employee
experience, the speed toconnection, band partnership,

(02:23):
like the betterment of ourindustry is so much faster. And
that's actually something thatyou can do on a daily basis.
Like you do not have to comecombative to every conversation
and we realize that in personlast week, but you don't have to
forget about that today. No,

Paul J Daly (02:42):
no, please carry that forward. That was probably
one of the most memorablecompliments is even after the
welcome reception. People werelike that was the best welcome
reception I've ever been to. Andit wasn't literally anything not
fancy. I mean, there was imaginethis. There was magic. It was a
nice room, but you had a few 100people, and you had drinks, and
you had a little music. Andthat's it. We didn't even have

(03:05):
name tags, because we had anissue with the printer. So
nobody had a name tag and wemight carry over the room
better, I think I don't know. Ithink it did. People like as the
best why because the environmentthat was created there was one
to speed connection and so muchmore to share. Thank you if you
were there, if you weren'tthere. We will do it again. We

(03:28):
actually Kyle and I this morningare signing the contract for
next year. So pull out your 2025calendar open your app. This is
the first public The first isit. We're gonna talk about it
right now. I mean yeah, here weare having a soda con 2025. The
same week we did this year sothe week of May 12. It's the
week after Mother's Day 2025 Wehave a graphic and everything.

(03:50):
Look at this 2012 That looksamazing. 12 Three 616 circle the
week. We'll have more detailscoming soon. Colin I inked the
contract as you're walking onstage this year. So please
circle it. Put a pin in it. Moredetails to follow but no one
should have the thing like oh Ididn't know it was coming this

(04:11):
year. Knowing that no one shouldhave that excuse. All right.
Let's talk about some news andwe have a full two week of work
to get into. So Automotive Newssecond ever used car only list
are used deal as they call itthey used only list it's the
people who sell used cars onlyreiterates the 2023 was a
pivotal year for used vehicleonly retailers Carmax still up

(04:34):
front No surprise there. Carvanais recovering despite a lot of
challenges last year and someother players that were on the
list last year are falling offthe list or have fallen off the
list. So car backs top of thelist sold 765,000 Plus vehicles
which is down five and a half5.2% from the previous year.
Carvanha sold 312,000 vehiclesin 2023. Down 24% year over

(04:58):
year, however, they're focusedon profit ability now, room and
shift technologies facesignificant setbacks you know,
shift filed for bankruptcy roomwound down other use car
operations drive time, which isactually car Carvana was a spin
off of drive time saw 7.2%increase selling 110,000 us

(05:18):
vehicles, Sonic automotives EchoPark increased sales by 15%
Selling 73,000 vehicles CarvanhaCEO Ernie Garcia said, we're not
super, we were not super wellpositioned to handle all of the
change, nor were many of ourpeers. But now we're seeing some
people, the people who are ableto pivot still in the game
putting down

Kyle Mountsier (05:39):
I mean, you know, when you look back at
2023, it's wildly differentalready than q1 of 2024. Like
these are gross up numbers for2023. We're seeing the pace of
some of these groups in 2024,especially on the US market pick
up already. It's interesting tome that in an affordability
crunch, they were able toactually succeed with the drive

(06:01):
time side of the business. Imean, I saw advertising left and
right kind of makes sense ifthey were able to have the right
cars, plus it's their owncaptive financing, that allows
them to potentially buy deeperin the market rather than have
to go after banks that maybeheld back on on resources last
year. So that's kind of like akey insight to me, but you know,

(06:22):
Carvana down 24% Carmax down5.2% It's no wonder that US cars
just had a little bit struggledlast year compared to previous
years. And reality is it's likewe're up so high the few years
before that, like this is just anormalization. You know,

Paul J Daly (06:38):
the great normalization we talked about
that a little bit. I was gonnathinking of a great segue
because this one deserves asegue. Do we still have the let
me see. Let me see.

Kyle Mountsier (06:51):
I Do I Do I have given

Paul J Daly (06:54):
you a W update?
Yes, the UAW faced a significantsetback. As 56% of workers at
the Mercedes plant and anAlabama voted against
unionization. Marking a blow tothe union's efforts to organize
some more southern facilitiesover 90% of the factories. 5000
eligible workers voted that's agreat turnout and a good

(07:17):
representation of the actualintent. 56% oppose the unions
with Mercedes officials havebeen actively campaigning
against unionization, presentingtheir plans to address the
employee concerns. So they saidthis is how we're going to fix
the problems. Don't vote for theUnion. Mercedes worker Melissa
House said we have the company'sear for the first time in a long

(07:38):
time. Another worker RickWebster said the number one
issue for me is a better worklife balance. The defeat
obviously a major setback forUAW president Shawn fain who has
been revitalizing the union withhis we'll call it a combative
approach. The UAW plans in theirlittle bit, they're going to
continue their $40 millionorganization drive targeting

(07:59):
various factories, includingthose operated by Hyundai and
Toyota Shan Fein said, whilethis loss stings, these workers
keep their heads held high, wefight the good fight and
continue forward.

Kyle Mountsier (08:13):
Well, you know, I mean, this is the first it's
the first one kind of shocking,honestly, after a few weeks ago,
locking down VW and Chattanoogaright now it is, I honestly it's
another German manufacturer,right? Yeah, exactly. And so
interesting to see thathappening, you know, and and it

(08:33):
would have voted better for themgoing into the Hyundai and
Toyota plants Hyundai having apresence in Alabama Toyota in in
Tennessee. But, you know, thismay be a little bit of the
downward slide because Hyundaiand Toyota as as manufacturers
are, like, have much betteremployee morale, at least the
perspective the publicperspective of it. So, you know,

(08:56):
we'll see if like, the pace cancontinue, or, you know,

Paul J Daly (09:01):
or if this looks like the Philadelphia Eagles
2023 24 season, after they lostthat one. It was not pretty
after that.

Kyle Mountsier (09:12):
Great way to put it.

Paul J Daly (09:14):
Obviously, speaking of inhabiting segue, whether
you're ready or not, here theycome.

Kyle Mountsier (09:22):
We're saying it live on the show Gen. Alpha.
Yes. Ladies and gentlemen, wehave set the words Gen alpha
children aged eight to 13,

Paul J Daly (09:32):
which is a lot of our collection, by the way.
Yeah. 2093 years.

Kyle Mountsier (09:37):
Yeah, may not be the foremost generation on
everyone's brand radar yet, butit's time retailers start
thinking about them and theirinterests. Here's some numbers
from a survey conducted by dkC's analytics group. Here's how
they go. 95% of Gen Alphaparents learn about new products
or brands from their child. Wow.
14 9% of these parentspurchasing decisions are

(10:01):
influenced by their child'sopinion. I got some things to
say about that. About 90% of Genalpha children find ways to make
money through chores allowanceand online selling getting

Paul J Daly (10:14):
that you're getting that paper dollar bill

Kyle Mountsier (10:17):
91% of parents say their children love to shop
with 92% finding interesting newproducts. Here's where they like
to where they like to go toshop. Walmart, Amazon, target
Nike Gamestop Five Below shine Ihate that Plasco Dollar Tree and

(10:38):
Sephora of all places. Oh boyNo, I wonder who's eight year
olds that are typing on Robloxright now. You know what I mean?
Oh

Paul J Daly (10:47):
my gosh, dude, that's freaking an awesome
insight. Maybe not five belowbut Walmart certainly as wow
that says Amazon

Kyle Mountsier (10:56):
and big target is all in Roblox is all in all
of those games that kids areplaying

Paul J Daly (11:02):
the point. The point of the survey is to show
that purchasing power is now inthe hands of this gen alphas
anybody born after 2010basically. And I think this just
paints the case for large scalebroad brand building in what is
cool, what is interesting, whatconnects what looks fun, what

(11:23):
looks easy. And yeah, trying tothink about like what purchasing
decisions now. Now I'm likeanalyzing like, what do we buy?
That because our own, like, ourGen alpha, right? Like one of
ours is four. So nothing reallythere going on yet. The other
ones are 12 You know, the otherone is 12. And then I also have

(11:44):
a 15 year old a 17 year old soit's like, tough for me you'd be
a better litmus test because allof these kids are like

Kyle Mountsier (11:50):
you, you experienced and you've you've
noted this to me like they'reyour understanding of like new
brands, you have new productswithout a dumbing from their,
their cultural understanding isdefinitely yeah, like and that's
a piece for us. Right? That'strue. But then, you know, when
it comes to like, purchasingdecisions being influenced by

(12:12):
the child's opinion, I mean, Idon't know does like the type of
applesauce we buy cow.

Paul J Daly (12:19):
Well, I mean, let's talk back to some of the
comments you've made beforeabout your kids asking you are
we getting a Tesla?

Kyle Mountsier (12:25):
Well, okay, so that's what I was about to bring
up right? Is I think thatcultural moment things are
definitely in these kids earsand especially when it comes to
car brands. Now I know that ourkids are obviously close to auto
but you know with themconsistently saying like Dad,
you should get a Tesla when arewe getting a Tesla? When are we

(12:47):
getting an Eevee like that'sgoing to be in the ears of a lot
of parents these days is thatevey conversation is gonna be in
the swing especially when youthink about these like these
roadblocks or these thesevirtual games are all of these
new Evie manufacturers areactually placing their vehicles
in the game. These kids aregoing to be all over

Paul J Daly (13:08):
that it's funny I've just as you keep saying
Roblox I'm like, look fordealership put a giant banner up
front with the Roblox logo waslike $100 in roebucks. With
every test drive, every kiddriving by would notice that
sign word. It's Oh, everyfreaking kid would notice the
Roblox sign that and they JefraVilla Do it, do it. I have a

(13:33):
couple dealers, we need to callright now and be like, Look,
it's gonna cost you $100 Forthis banner, it's worth trying.
I think I think that's what wehave. Oh, man, look, if you have
don't follow us on LinkedIn,follow us Soto on LinkedIn.
We're gonna be posting a lot ofshow content. We're going to be
releasing a lot of show contentto people's about the show. We
have a great community, geteverybody else in here. They

(13:53):
need to be here.