CBT automotive newscast: October 26, 2021

Inside Automotive:

Morgan Automotive’s Brett Morgan discusses the group’s latest acquisition
It has been an incredibly active year of acquisitions in retail automotive. The latest news coming from Morgan Auto Group of Tampa, Florida. The Group, ranked number 11 of the top 150 dealership groups in the U.S., purchased Reeves Import Motorcars, adding a few new luxury brands to their already extensive portfolio. Joining us now to discuss the Group’s latest acquisition and what it means overall is Brett Morgan, CEO of Morgan Automotive Group. Watch the complete segment here.

Headlines:

General Motors and Ford are likely to show investors both the positive and negative financial impacts of the ongoing chip crisis after Q3 results post this week. Both GM and Ford had to idle assembly lines with lost production and a rise in supply-chain costs. However, GM and Ford have been able to offset that pressure thanks to strong demand for their full-size trucks and SUVs, which allowed them to cut back on discounts and maintain strong profits.

Speaking of General Motors, the automaker has revealed two new high-end GMC Sierra 1500 pickups, including the Denali Ultimate that has a starting price of more than $80,000, making it the most expensive, full-size, half-ton pickup on the market. The other new pickup is the AT4X, a more luxurious and off-road capable pickup, starting at $74,995. The vehicles are scheduled to hit the market in the spring of next year.

Hertz has ordered 100,000 Tesla cars for delivery by the end of 2022, as an investment to build the largest EV rental fleet in North America. EVs will comprise more than 20% of the company’s global fleet with the current order. Hertz plans to install thousands of EV chargers in its network with a combination of level 2 and DC fast charging in about 65 markets by the end of 2022 and more than 100 markets by the end of 2023.

In more EV news, Mercedes-Benz plans to cut their margin by half a percentage point, to 13%, to help cover the expense of EVs. The reduction will come out of the dealers’ 6% “trade margin”, which is the difference between a vehicle’s invoice and its sticker price. Daimler aims to invest more than $46 billion between 2022 and 2030 to develop EVs and become an all-electric brand in markets ready for the switch. Dimitris Psillakis, Mercedes-Benz CEO said that the transition to EVs would not affect retailer margins.

HBO’s “Last Week Tonight with John Oliver,” wrote a commercial script and offered it to one car dealer for free as long as it agreed to shoot it, word for word before even reading it. Minnesota dealership, Zumbrota Ford accepted the challenge and the ad has now gone viral, racking up over three million views.

News & Opinion:

Hertz places largest fleet order of Tesla EVs to date
Early on Monday, rental car company Hertz confirmed in a press release that they have ordered 100,000 Tesla EVs for their fleet operations. The deal is worth $4.2 billion, and the vehicles are to be delivered to Hertz by the end of 2022. In addition to the EV purchases, Hertz will implement their own charging infrastructure across its operations globally. Former Ford CEO Mark Fields is the recently appointed CEO at Hertz. He states in the release, “Electric vehicles are now mainstream, and we’ve only just begun to see rising global demand and interest. Read more

How to help struggling F&I managers embrace change
When someone has done the same job for years, the exact same way every day, it can be a challenge to get them to embrace change. With F&I, the old way of working a deal has changed a lot over the decades and with it, managers have had to adapt. New products, new presentation methods, new compliance rules, and regulations. The list goes on and on. But what do you do if you have an F&I manager who won’t embrace change – not even a change that makes them better at their job or could help them achieve their goals quicker? How do you reach them? Read more