CBT automotive newscast: October 22, 2021

Inside Automotive:

Chief Enthusiasm Officer Kenya Rutland on how to build diversity and inclusion in your dealership
After the nation’s civil unrest last summer, you may have noticed many companies making the decision to evaluate and adopt a more diverse and inclusive workplace. Well KJR Consulting has been behind the strategy for many large companies like Coca-Cola and Asbury Automotive Group. On this episode of Diversity in Automotive, we’re pleased to welcome the Principal and Chief Enthusiasm Officer at KJR Consulting, Kenya Rutland, to discuss training, coaching, and the importance of diversity and inclusion in our industry. Watch the complete segment here.

Headlines:

Stellantis and the National Business League have launched the pilot for the Nation’s first black supplier development program. The initial phase is part of a larger program to provide businesses with virtual training and give them access to an online marketplace with the goal of building “a bridge between public and private sectors to create business opportunities for black suppliers around the world. The pilot will run through Q1 of 2022.

Tesla notched a third consecutive record quarterly profit, earning $1.62 billion in Q3. Revenue jumped 57% to $13.8 billion, and automotive gross margins rose to 30.5%. Earlier this month, the EV maker said it delivered a record 241,300 EVs in Q3. The company is changing the battery chemistry that it uses in its standard range cars to a version with a lithium-iron-phosphate cathode. The move is likely a way for the automaker to increase profit margins on its fully electric cars, with the aim to not raise vehicle prices.

In more EV news, the United Auto Workers is telling its more than 400,000 members to urge elected officials to support proposed tax credits for union-made EVs. The proposed $4,500 tax credit has been controversial with automakers such as Toyota and Honda that produce vehicles with non-organized workers. The credit is part of a proposed $12,500 in tax incentives for the purchase of an EV. The EV incentive package is expected to cost about $15.6 billion.

Weekly jobless claims hit another pandemic-era low. First-time filings for unemployment benefits totaled 290,000 for the week ending October 16, down from the previous period. This was the second week in a row that claims ran below 300,000. Continuing claims also fell to their lowest since COVID began, dropping to 2.48 million, a from the previous week. According to data through October 2, the total of those receiving benefits under all state and federal programs fell by 369,992 to 3.28 million. Last year, that total was nearly 23.8 million.

News & Opinion:

Building a sales-minded parts team to grow your parts department
If you want to create meaningful growth in your parts department, you need to maximize sales online and over the counter. The way to do this is to train your parts advisors to become better salespeople. Let’s face it, most parts advisors are not trained to be salespeople. Customer interactions, upselling, and similar sales techniques are not as heavily focused on in the parts department compared to the sales department. However, taking a sales-minded approach in the parts department can make a world of difference in your parts department’s success and increase parts and accessories revenue. Read more

Tesla marks record deliveries in Q3, ninth straight profitable quarter
Tesla’s earnings were reported to investors on October 20, and the financial results paint the last quarter as bright despite the ongoing pandemic and supply chain issues. For the ninth straight quarter, Tesla has generated a profit from its operations, achieving a $2.0 billion operating income on a total gross profit of $3.66 billion. Markers for profitability were exemplary for Tesla in Q3 2021. The total GAAP gross margin rang in at an impressive 26.6% and the adjusted EBITDA margin was 23.3%. The carmaker ended the quarter with a free cash flow of $1.3 billion. Read more