Good morning. It is Thursday, July 30th. It's the 30th. One day left. It's the Automotive State of the Union. I'm Paul Jay Daly. That's Kyle.
Today we're talking about Carvana's record run Zoox, no steering wheel, that's approved, and some technicians starting, uh, pretty early in their career, I would say. We love it. We love to see it.
Favorite type of story, actually. We love it. This is a great-- I mean, look, normally Thursday's a bit of a lull. This can be- This is a good Thursday... we got, we got a little, we got a little spice.
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Carvana-- Oh man, I had a segue into the first story. Oh. I said, "Speaking of working," and I missed the thing. It's always a good day when we have a segue- It's, it's okay. It's okay... into the first story.
But this is great. Carvana just put up its biggest quarter ever, selling more than 197,000 vehicles, generating 7 point billion in revenue.
They're scaling production, expanding their Odessa capacity, and says the long-term target of 3 million an- annual sales is firmly on the table. I remember when Ernie Garcia said 1 million was the goal.
That was their big audacious goal. Q2 sales up 38% year over year, double the company's volume two years ago. Wow.
Carvana's now, uh, pacing towards 800,000 vehicles this year while reaffirming its goal of reaching 3 million annual sales sometime between, we'll say, the year 2030 and 2035. Uh- We'll see...
three more Odessa sites joined Carvana's retail production network, bringing the total to 19. They can support 1.5 million units of reconditioning- [laughs]...
and distribution, with, uh, room to eventually hit that 3 million mark. Higher income shoppers are becoming a bigger growth engine.
Customers earning, uh, more than $1,000 a-- $100,000 a year increased to more than six-- increased more than 60% year over year as they have now a mix of higher priced vehicles. The new vehicles probably help.
CEO Ernie Garcia summed up the opportunity saying, quote, "The sales volume puts us at 2% market share of the used car market and 1.5% of the auto retail market as a whole."
There's two stories that are super important for every single detailer, uh, retailer to be paying attention to right now.
The story number one is how to get your reconditioning centralized and the throughput extremely fast.
If you are a multi-location dealer and you're not thinking about reconditioning centers that are offsite, that are solely dedicated to make sure, the, making sure the throughput of your used cars is dialed in so that your merchandising hits early and that you can turn your used car inventory a lot faster than if it went through the regular shop, then you're crazy.
That's what you can learn from Carvana there.
The other thing that you can learn from Carvana is that if people that are purchasing that have household income over $100,000 are looking for a more convenient way to purchase because the rest of their life is oriented around convenience, Uber, Lyft, Uber Eats, DoorDash, because they have access to spend the extra money to get that, then how do you figure out how to make sure that high income earners are getting a, an additional level of convenience and experience through delivery or online retailing or a, uh, a better shopping experience that prioritizes the experience for them?
Those two things are where Carvana is actually, i- is winning. They've only still got 2% market share, so it's not like they're beating everyone.
It's just that they're doing the right things well, the things that they do best, and you can learn from them. Well, I'm gonna see your two things and raise you two things. Get, get on.
First of all, my f- my first thing is how do you come up with these commentary points so quickly? I'm so impressed. [laughs] So impressed. That's my first thing.
My second thing is, [laughs] the first time I met Ernie, he was talking about they, they had, I don't know, half a percent, a four tenths of a percent, and he was telling this room full of dealers, he was saying, "Listen, our goal is to hit 1%, and we think that's far out in the future."
But granted, this was close to, I don't know, seven years ago, and they've surpassed it- Wow... and they're picking up velocity, and now they're saying 2030, 2035, right? That's pretty far out into the future.
But I think one thing Carvana has proven is that they can weather the storm and they can execute. I think that's what we're seeing right now, is the- Man... the, the true- Weather the storm. Talk about it...
the trueness of them being able to execute in the midst of headwinds, and I think that's gonna continue, and I think there's a lot for the industry to learn from Carvana, especially now that they're a new car dealer, right?
Yeah. Oh. At the, at the table, folks. There's gonna be so much to learn. I know. Look forward to- Speaking of being at the table. Woo. Stop. Very nice. Segway. Time. [upbeat music] Feeling on a Thursday.
Amazon Zoox, you know, that little toaster-looking autonomous vehicle- [laughs]...
just cleared a major regulatory hurdle, becoming the first company approved in the US to commercially deploy robo taxis that are paid with no steering wheel, no pedals. Wow.
Uh, it's a limited approval, closely monitored, and it still needs some clearance before passengers can start paying, but, uh, National Highway Transportation Asso- uh, something Association, NHTSA- They approved Zoox to commercially deploy up to 2,500 of these robotaxis a year for the next two years.
Unlike Waymo, it's fully electric. It's like you step into this, like, little transport vehicle. There's no steering wheel. Seats face one another. It's a different experience than riding in a car, for sure.
Uh, they carry test passengers. We see them when we're at the, you know, NADA show in Vegas. If you're in San Francisco, you've seen them.
Um, but now this new exemption allows them to actually charge for the rides as well, so now it's like a full commercial unit.
Um, you know, they have some added reporting requirements covering, like, crashes or if they stop improperly, but we know everyone else is having trouble with that, too. So, I don't...
I wonder what those extra requirements are. Um, so NHTSA administrator, Jonathan Morrison, said, quote, "We have the ability to pull the exemption if we see major safety issues," so dad's watching.
One thing I don't understand is, is how this differs from what Tesla's doing with the robotaxi.
It, I think it's just because there's no steering wheel or pedals, and something new is always a little bit- Is that what it is? Yeah, yeah, yeah... un- Absolutely. That's, that's the only difference, really. Yeah.
It's like this is fully autonomous with no way for someone to get... How, how do they- I mean, this is- How do they drive- Let, let me tell you... this thing if it's, like, like, not talking to the, the mothership?
Do they just, like, pick it up? Like- You just gotta pick it up. Yeah... is there, like, a secret compartment where, like, a little joystick comes out? Whoop. [laughs] That, that's kinda how I imagine it to be.
I mean, seeing these things run around Vegas, and having been to San Francisco, this is, for large cities that have, like, interconnected- Yeah... very, very resilient, like, streets, blocks- Boulevard and streets.
Yeah... these things are amazing. So good. They, they are so easy to maneuver. They get in tight spaces. You think about their ability to just, like, pull up, get, grab a, grab a crew, and roll out.
Um, I, I, I see these going rapidly into many cities. $2,500, uh, 2,500 of them a year is not many, still.
Uh, so I'm interested to see, like, when the ramp happens, because that's only gonna supply, you know, a few cities. Uh, but- I mean, I feel like this is, like- Man... this has Nashville written all over it.
Bro, these, these would rip around- Bro, and they need-... downtown Nashville... like, a button- Are you kidding me?... that's, like, bridezilla mode, right? G- Yes... 'cause it's all the bride... Right?
And just- Oh, dude, people would be branding these things all o- all over the place. And Amazon has a massive foothold in, in Nashville. They sure do. So, I see them coming here quickly. Oh, my gosh.
So, and we already have Waymo, so it's like there's a, there's a precedent for some of this stuff. I wanna bring one of those big, like, gigantic JBL boom boxes into one of these. Oh. And, like, a little disco ball.
[laughs] You know what I want? I want, like, a cowboy hat attached to the top of one. That's a g- You, you, h- Well, you came up with- We got a business... the toaster idea, too.
Gotta get the one with the toast outside of it. Dude, yeah, you just got, like, bread sticking- Sticking out the top... out of the top. Oh, my goodness. Come on. Oh, we, the football helmets.
Like, we can do the whole thing. All right. Oh. Speaking of childish ideas. Stop. Segway. Time. [upbeat music] Not really a childish idea. [laughs] This one we absolutely love.
Sinclair College is giving middle school students an early look under the hood and into the industry's future.
It's a three-day automotive technology camp that mixes practical owners, uh, ownership skills, helping dealers and schools build tomorrow's workforce.
14 students, ages 12 to 15, are learning how to change oil, jumpstart vehicles, remove batteries, and rebuild small engines.
Campers also experience ride-alongs in electric and self-driving vehicles, uh, connecting traditional shop skills with emerging automotive technology.
Voss Auto Group sponsors the camp as part of its longtime, uh, partnership with Sinclair, and sees the program as an early technician recruiting pipeline.
Sinclair says roughly 110 students work in their local repair, repair shops during any given semester, and 95- Woo... percent of graduates find industry employment within one month- Come on... 'cause we need them, fam.
Yeah. [laughs] Let's go. Voss service manager, Tim Whalen, said, "We like to bring young people in and help them become a professional technician." More of- Snaps on this one... this in the industry.
It is the easiest thing to deploy. There... You don't have to look around. I don't care if you're rural. I don't care if you're an urban dealership. There are students- Yeah...
everywhere who are thinking- It's too easy... through and deciding what they're trying to do when they grow up. We know they're hearing a lot, "Is college worth it? Is it not worth it?" All this stuff.
There are kids that are technically oriented already. Cars are so much fun. Ugh. EVs are even more fun.
To get them in, get them around all the stuff, and be like, "Hey, you could do this every day, and make really good money, and get all the things that everyone says, like, you should have to wanna get when you're..."
Like, get a house, and provide for you, get pets. Or if you wanna travel. And forget about all that college nonsense. If you want that electronic stuff, if you want your own car, right?
All of those things are possible through this very lane. And, I mean, can't celebrate this enough. Hats off to the people of Voss Auto Group.
Everyone else who's not doing something like this should reach out, pay attention, um, and, and do more of it. I mean- Done... gosh. Shift it.
It's easy to make this an industry when people fight to join, when you're doing- It's easy... stuff like this. It's right there. They're not even fighting to join. They're like, "I'm in." They, no fight included.
They're like, "I'm a part of it. You should be a part of it, too." We'll see you here tomorrow morning. Go get that email we talked about in the beginning, too.
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