CBT automotive newscast: April 9, 2021

Featured Interview:

Automotive expert David Lewis on how car dealers can avoid bad habits during successful sales periods
Today on CBT News, we welcomed back David Lewis to the show. Lewis is the President and CEO of David Lewis and Associates and host of the CBT original show Straight Talk. Lewis joins host Jim Fitzpatrick to discuss how car dealers can carry momentum into the second quarter of 2021 and beyond. Lewis opens the conversation by warning car dealers to be cautious of falling into bad habits while experiencing success. He looks back to last year when car dealers were fearful after the lockdowns forced by the COVID-19 pandemic. Watch the full segment here.

Top Headlines:

The Biden Administration’s $174 billion proposal to boost electric vehicle production, calls for $100 billion in new consumer rebates, and $15 billion to build 500,000 new electric vehicle charging stations. The EV rebates are part of Biden’s $2.3 trillion infrastructure and jobs proposal, which could assist automakers like tesla and general motors, which no longer qualify for $7,500 tax credits after selling more than 200,000 zero-emission models. The White House has declined to say how the $100 billion would be distributed.

Mercedes-Benz was first in luxury sales in the first quarter of 2021. However, BMW and Lexus are closing the gap quickly. Lexus was within 4,000 sales of Mercedes, while BMW trailed Lexus by a little more than 2,800 vehicles. The luxury vehicle segment continues to heat up, as total U.S. luxury sales rose 20% to 547,903 vehicles in Q1.

General Motors is looking to expand its opportunities to generate revenue beyond selling cars. CEO Mary Barra told Reuters that GM is currently looking into other segments such as insurance, ride-sharing, software, and flying taxis. Barra said, “we have very significant growth opportunities and different margin opportunity initiatives to invest in.”

Bozard Ford Lincoln, a dealership based in St. Augustine, Florida, has expanded to include a Ford’s Garage restaurant. The dealership is the first of its kind to include a popular restaurant franchise. Customers have the unique experience to walk through the showroom directly into the restaurant where they can order a burger, chicken wings, salmon salad, homemade meatloaf, shrimp and lobster mac & cheese, and more. Bozard is likely the first of many dealers to expand into the restaurant business.

News & Opinion:

Record high wholesale prices reflect tight used inventory, strong sales
The cost per unit to purchase inventory for the used car lot continues to increase as the second quarter of 2021 kicks off. The Manheim Used Vehicle Index for March reached a record high of 179.2, reflecting an increase of 26.2% from the same time last year. From the previous month, the Index rose by nearly 6%, adjusted for mix, mileage, and the season. Chief economist at Cox Automotive, Jonathan Smoke, said, “It is not uncommon to see a spring bounce in wholesale prices, but a 26.2% increase is a leap by any measure. We continue to experience high demand and limited supply. Read more

Tougher tailpipe emissions coming under Biden Administration
The Biden administration does not seem to be backing down regarding tougher environmental regulations. This week, the head of the Environmental Protection Agency, Michael Regan, announced that the EPA is planning to propose tougher tailpipe emissions rules by the end of July, which would involve rewriting former-President Trump’s less stringent guidelines. Regan quoted “the urgency of the climate crisis” and added that “the science indicates we have a short window in time to reverse the path that we’re on and mitigate against certain climate impacts. Read more