Inside Automotive with Jim Fitzpatrick, powered by CBT News

How Clear Programs, More Bays, And Smarter AI Turn A Dealership Into A Market Winner

• Jim Fitzpatrick • Season 1 • Episode 28

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Sales surged after a slow start as clear Ford programs, tariff tailwinds, and aligned execution lifted confidence and profitability. Alex Perdikis unpacks tech capacity constraints, mobile service as a force multiplier, EV leasing strategy, and how AI boosts follow-up while keeping managers close to the deal.

• Ford pricing programs driving demand and clarity
• Consistent execution by managers and sales teams
• Fixed ops growth limited by bays, not techs
• Apprenticeship pipeline with local schools
• Ford Pro commercial service center plans
• EV leasing as the adoption lever in DC market
• Mobile service expanding capacity and visibility
• Community offer for furloughed government workers
• BDC skepticism and early manager involvement
• AI for follow-up, appraisals, and appointments
• TradeAgent AI scaling outreach with live valuations

Inside Automotive with Jim Fitzpatrick is powered by CBT News, your go-to source for the latest news, trends, and insights in retail automotive. Subscribe for more interviews with top industry leaders, dealership innovators, and experts shaping the future of automotive.

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Announcer:

Welcome to Inside Automotive with Jim Fitzpatrick.

Jim Fitzpatrick:

Hey everyone, Jim Fitzpatrick. Welcome into another edition of Inside Automotive right here at CBT News. Staying ahead of today's market shifts isn't just about reacting. It's about uh really adapting and finding solutions to run your business better. Joining us today to break down what he's seeing on the ground is Alex Perdikis, who's the CEO and owner of Koons Motors. Alex, thank you so much for taking the time out of your schedule to join us on the show.

Alex Perdikis:

Thank you for having me. I appreciate it.

Jim Fitzpatrick:

Sure. So there's a lot out there to talk about right now. First and foremost, how is business at your stores?

Alex Perdikis:

Uh business is strong. We're uh having a great year. Uh, I would say uh I've had conversations about this over the last uh month or so, but the first couple months of the year were a little bit dicey um here here in the DC market um for lots of different reasons. And then uh I have to tell you, the the tariff situation really worked in our you know in our favor. And from I'd say mid-March until through September, we've had a an incredibly strong run.

Jim Fitzpatrick:

And and why is that? Why why do you think it worked in your favor?

Alex Perdikis:

Well, I think for Ford, uh I'm a our we're we're you know, our primary business is Ford and Lincoln. We have Mazda also, but we have Ford and a couple Lincoln stores. Yeah. Um, so I would say our primarily for for the Ford business, they did a really great job with the with the America program, you know, with the America First Program and the employee pricing program for everybody in America. Just a great program. It was clear, it was concise. They were first to market with the message. Um, it was very easy to execute on. Um, and anyway, so it it just created excitement, synergies. Um, it was simple. And uh, you know, once you can do something with your with your team, especially with your salespeople and your managers, where everyone's working off the same song sheet, so to speak, um, everyone's excited about the program. Um, customers understand it, the pricing, everything is clear and concise. You know, that just that just builds a lot of consistency, confidence, and excitement. And so uh that really helped, you know, that really helped propel us. And um, not just from you know, from our sales standpoint, things were strong. Um, prof profitability was great. F and I had a great uh has had a great run. Good. Um and so, you know, so the sales side was great. And then, you know, as things kind of went on, you know, they were they've uh adjusted a few things um when the program ended, but uh Ford's kind of been at the you know in the forefront with these programs, yeah, which has been great for us. So they took the lead, you know.

Jim Fitzpatrick:

No question. And uh and and uh Jim Farley was talking about um not to switch gears here, but in terms of fixed ops, uh, that there's 6,000 service bays without technicians. Um comes at a time that you know the industry needs every technician they can get their hands on. How is that at your store? Are you short of technicians as well?

Alex Perdikis:

So we have we have uh we're kind of a unique situation. We've got 42 techs and 41 bays. So it's a little in our four business. So it's a little kind of, you know, we're not, we're definitely not, you know, we need space. We need more actual bays more than anything. So our our challenge is a is uh is a real estate facility, you know, uh constrict constriction, so to speak, or restriction, however you want to call it. Uh, we need to build out, we need to grow more. Um, you know, fortunately with our business, we've got some great leadership that grew from within in our fixed operation side. So that that leadership has done a great job kind of molding and growing the talent. Um, you know, it's never perfect, you know, we're always trying to get better. But um, but yeah, I mean, I don't that doesn't mean that we're not working towards the next generation of technicians because of what we have now. Um, but I will say, you know, we we work with the local trade groups and the trade associations and um we work close with uh there's a technician trade school here that we work with one of the local high schools where we'll bring on those technicians at a at a you know at a at a lower level, obviously an apprentice level um situation and get them in and grow them. I mean, that's really the best way we have found um, you know, to to really get the bet to really build up your service department is to bring the talent in and grow it. And they learn they learn your way, your way versus you know, trying to go out and poach, you know, some high talent. Um that's yeah doesn't always seem to work out the best for everybody when you do that. Yeah. Um you know, rather invest on the on the on the younger, lower, lower performing or lower talent level ones and grow them. So you know, it's a it's an issue, no question. You know, um, fortunately, we've had the right leadership and talent internally that we've been able to kind of you know buck that trend a little bit. Um, and fixed ops has had just a banner year parts.

Jim Fitzpatrick:

It seems as though since 2021, fixed ops has never taken their foot off the accelerator. Has that pretty much been the same at your group? That every month when I talk to fixed ops directors and dealers, they're like, Man, fixed ops is just cranking along and we're it's we're knocking the cover off the ball.

Alex Perdikis:

It is, it's cranking. And we, you know, I I I actually as a as a dealer owner, I feel more pressure to create more capacity.

Jim Fitzpatrick:

Yeah, right.

Alex Perdikis:

So again, talking about facilities. So yeah, um, you know, one of the big things on our radar this year has been uh we signed in a letter of intent with Ford, it's been now a couple years with the Ford Pro program. So in doing that, you know, we're we're gonna build a Ford Pro commercial commercial service center. Um and that's gonna you know be about 26 bays, you know, if we can squeeze in a few more, that'd be great. Wow. Um completely separate, you know, facility for commercial trucks and vans and you know that whole commercial line of work. That's awesome. Um, but our challenge is real estate. Yeah, you know, challenge is finding the right zoning, finding the right location, finding the right spot to do it. And um, you know, we've we've been working on that extensively over the last year to find the right location. So that's kind of top of mind for me. It's more, you know, we've got all this opportunity, we've got all this work. Again, you know, uh a great thing about being in the Ford business, you know, we've got a just a massive opportunity with the commercial, not just the commercial sales, but commercial servicing. And uh, you know, these people need their vans working, they need their refrigeration units, you know, working properly, they need their, you know, their cherry pickers working, they need all this stuff active. If if a if a truck, a van, whatever it might be, is off the road in the shop.

Jim Fitzpatrick:

It costs them thousands.

Alex Perdikis:

That's exactly opportunity cost is isn't is tremendous.

Jim Fitzpatrick:

So no question about it. Yeah. Hey, and in uh September we saw an increase as as high as I think 12% in terms of EVs, uh, due in large part because the you know the tax credit was ending September 30th. Um where do you guys stand on EVs? You had a good month probably in September. What's the inventory look like now and what is your take on it moving forward?

Alex Perdikis:

So the inventory is fairly healthy, you know, going into the fourth quarter. Um you know, I think we, you know, I love Ford's idea with you know doing the the kind of the the internal sale program to take the to be able to accept the tax credit, yeah, which from my understanding was actually approved by the IRS. So I don't know why we're reversing the program, but it is I don't know if you've heard about it, but we're reversing it now. So that is that is what it is, like you know, yeah um, but if if the IRS approved it, I don't know why we would change it. But that's again, not I'm not not to get in politics and so forth.

Jim Fitzpatrick:

But no, right.

Alex Perdikis:

Um so I thought they were on to something when they did that. It it that I thought that was smart and I was actually excited about it because we got we also have a good amount coming in. But I think you know, with the EV thing, um, obviously there was a big push to the end there to take advantage of the tax credit for the consumers. And so I think, you know, I think with with uh with Ford, it's gonna come down to leasing. I mean, that's my personal opinion. Like if we can do a really good job coming out with a strong residual, a good money factor, and just incentivize the heck out of that thing and lease it, uh, I think we'll do well with it. I mean, we've seen that across the board with Lightning, we've seen it with Machi. Yep. Um, I mean, obviously we've seen it even in our Mazda side with the with the plug-in, the CX90 and the CX70 plugins. Um, if you come out with a strong lease program, that customer that tends to resonate well with that, with that consumer in our market. Um, so it's gonna come down to incentives at the end of the day, right? Like like any, unfortunately, like anything else. But um, but there's, you know, we're we're just seven miles north of the Capitol, so of Washington, D.C. So we're not far from the Eve kind of the a big kind of EV hub, so to speak. Um Northern Virginia, there's a is a huge EV market. Yep. So I I mean, I think we're gonna have, you know, we're gonna have we're gonna get our share, you know, in this DC market. Um, and I mean, I'd like to get more of it, you know, if we had some more incentive to pass on to the customer. But um I think it's a great product. I think the Mach E, you know, toe-to-toe with you know, Tesla Model Three or any of these other vehicles, yeah, I think it just crushes it. It's a great product. Um, I like driving.

Jim Fitzpatrick:

You guys just had a SAU, but I mean Ford, Ford just was advertising a Mach E for $239 a month on a 24-month lease. Right, exactly. Three or four grand down, but but still that was an incredible number.

Alex Perdikis:

Exactly. It's a no-brainer. And then you couple that with, you know, the you know, it's obviously an EV. There's no get, you know, you're gonna be, you know, plugging it in your home or wherever, and right all in all, it's a great, it's a great commuter car, it's a great you know, car to have around the city, yeah. Um, you know, and so forth. Yeah, it's fantastic.

Jim Fitzpatrick:

You can't that's that that's the value of three black Uber rides right there.

Alex Perdikis:

Right, right, exactly.

Jim Fitzpatrick:

You might as well just lease the car.

Alex Perdikis:

Exactly. So so if the programs are if the programs are they don't have to be crazy, but if they're sufficiently, you know, supportive enough and um and the customer and it gets the customers just enough to make that decision, yeah. You know, I think we're gonna do well with it, you know. And I at the end of the day, it comes down to the product, you know. And I think I think Ford um and I think Barley and his team do a good job with the new product that's been coming out with generating excitement and um making it stand out and differentiating itself. Yeah.

Jim Fitzpatrick:

So yeah, for for sure, for sure. Um going back to service for just a quick second. Um are you guys doing the mobile service that Ford pushing?

Alex Perdikis:

Oh yeah, it's a huge part of our business. So we have five vehicles right now. Nice and um, and we're out, you know, we're out, we're constantly out on the road. Yeah. Um that's what that's a capacity um solver, so to speak. Yeah. Because you, you know, the more you can do, the more it increases your capacity in your shop because you've got you know these uh these vehicles out, you know, out on the road, whether they're in someone's home or maybe maybe at a commercial fleet center doing work in their in their parking lots. Yeah. That's that's taking the pressure off of us here on our lots and taking and opening up more bays. Right.

Jim Fitzpatrick:

And it also doesn't require necessarily a master tech, right? I mean, that could be, yeah.

Alex Perdikis:

No, but that's been a huge, that's been, you know, um, you know, not to not to show our cards too much, but you know, it's kind of one of those things like I'm surprised it's it I'm surprised more manufacturers haven't picked up on that more faster.

Jim Fitzpatrick:

Yeah.

Alex Perdikis:

Because it's such it's such a it's such an amazing thing. And it's not just for Ford, you know, it's for anything that any any pre-owned car that you, you know, that you own or any non-Ford that you own, any cars that we sell, we offer it. So we obviously offer it for Ford and Lincoln.

Jim Fitzpatrick:

Oh, I didn't I didn't I wasn't aware of that. Okay, so if they buy a car from your dealership at Koons, you'll service any vehicle uh mobile.

Alex Perdikis:

Exactly. Wow, that's cool. Yeah, we do Hondas, Toyotas, you know, Hyundai's. Um and actually right now, you you you you're talking me into it. So not not to bring up politics, but this is not political, but just being where we are in the government in the government workforce that we have, um, we actually came out with a program where we are um any any government employee that's been furloughed, okay. Um, we are offering free mobile service in your home. Wow, that's awesome. So for free. So we'll just come to your house, oil change, and the car and the vehicle does not have to be bought, you know, from our stores, nothing.

Jim Fitzpatrick:

So um Oh my gosh, that's an incredible program. Yeah.

Alex Perdikis:

So so it's a pretty good deal.

Jim Fitzpatrick:

And are you getting calls on that?

Alex Perdikis:

Oh yeah, oh yeah, we're doing several a day.

Jim Fitzpatrick:

That's fantastic.

Alex Perdikis:

We hope, you know, we hope we we show them what a cool experience the mobile service is.

Jim Fitzpatrick:

Yeah.

Alex Perdikis:

And then, and then you know, you hope to kind of bring them into the fold of your of your of your family, sure.

Jim Fitzpatrick:

So to speak. Sure.

Alex Perdikis:

Uh yeah, and it's just a small, I mean, it's really at the end of the day, it's not, it's it's not that big a deal, right?

Jim Fitzpatrick:

I know, but it's it's a it's a very nice gesture.

Alex Perdikis:

It's a good gesture, exactly. And we've gotten some great, I've gotten some really cool emails, oh, I bet I bet messages.

Jim Fitzpatrick:

Yeah, yeah. We don't I don't know how long it's gonna last, whether it lasts another day or whether it lasts another month, is which is some craziness, craziness going on there, that's for sure. Exactly. Yeah. And uh and and listen, when when one of those vehicles, those vans pulls up in a neighborhood and they're having their vehicles serviced, what happens? Everybody else that's on that cul-de-sac or that block goes, uh what's going on down there? I'm not my dealership, my dealership doesn't do that, you know.

Alex Perdikis:

Right, exactly. And it's got the you know, it's all it's like it's and it's a huge moving billboard. So it says, you know, Koons, motors, you know, mobile service, the phone numbers, you know, QR codes, you know, that whole thing. So um so it's great, it's great. And uh I had a I had a call from a former teacher of mine this morning actually, had a situation with uh check engine light. So hey, we're gonna get we're you know, he couldn't get to the store, he had to go to teach a class, and you know, my service director sent the mobile van out there, you know.

Jim Fitzpatrick:

Yeah. Well, maybe now he should have given you, he's thinking about giving you a better grade than he, you know. Exactly.

Alex Perdikis:

Yep. It's too late. That's okay though.

Jim Fitzpatrick:

Listen, I'll ask you this one this one question that I know you you're getting asked a lot, and and everybody's talking about it, but but how is AI uh impacting your your day-to-day business there? Uh everybody is just focused on all things AI. How is it gonna move the in-reedle? How are we gonna be able to do more in the auto industry on less, even if that means less headcount? I know a lot of dealers come on and go, no, no, no, we're gonna keep all of our people, but but at the end of the day, I can say that I see this as an opportunity to run a dealership on less headcount. And I know that that's not popular. I won't make you say it. Sure, but from my standpoint, I see that that's where this could go. I think this is it's a good thing for the auto industry because we've been trying to get our hands around expenses for so long. And I think that AI allows us to do that, whether it be service calls, follow-up calls, appointment setting, whatever it is, right?

Alex Perdikis:

Right. Definitely, yeah. So look, it depends on the structure of your business. So we, I'm not a very big pro BDC person as an operator. I never was as a manager, as a general manager, yeah. And now as a dealer owner, like I don't love the BDC concept because I've always felt like the best people on the phone, you know, are your salesman, you know, your general sales managers, your general managers, your use card directors. Sure. And and I'm talking from a sales standpoint at this at the moment, right now, not fixed ops, but I don't necessarily want a low-level BDC employee, you know, on that phone call. Yeah, that makes sense. I want I want the sales managers on that call. I want the sales manager knowing what's happening with that customer. I want that customer seeing that sales manager when they walk in, like, oh, hey, it's Jim. Oh yeah, Jim, I just you know, I just talked to you on the phone about the there's already a connection, right? So the the earlier a manager gets involved in a deal, the higher the success rate of the deal. So the closing ratio goes up and the gross profit goes up like 50%. I think industry is thinking we we found it with assumed the earlier a manager is involved in a deal, you got you're just gonna have a better shot at closing that deal and it's gonna be more profitable. Yep. So we want to try to get our managers involved quickly. We don't I'm not big into the BDC, you know, and and appointment set. I mean, it's important to make sure there's follow-up happening. Yeah. So where the AI comes in, okay, is and we do leverage AI. We use, we we're using actually three different companies right now for three different purposes.

Jim Fitzpatrick:

Okay.

Alex Perdikis:

And um, and so and we've seen we've seen massive success really across the board. And so um what I find is that the AI is handling that menial task and it's you know, and it's making sure that that consistent follow-up is happening. Yeah. Um, you're, you know, you gotta you gotta be careful with how you're messaging it at first, and you gotta be careful to make sure that it doesn't look too robotic.

Jim Fitzpatrick:

Yeah.

Alex Perdikis:

Um, and so uh, you know, I think I think what it's gonna do is obviously it's gonna free up our salespeople to spend more time with the with the customers one-on-one when they show up. It's gonna free them up to do a better job on a on a six-position walk around to go on a test drive. It's gonna free them up to do all sorts of things, and they're not gonna have to sit there and stress out about did I follow, you know, did I that my my daily work plan wasn't handled because I didn't follow up with X, Y, Z customers today. Let the AI do some of that stuff, right? So I don't necessarily think it's gonna replace salespeople, but I think it's gonna make them more efficient and more effective.

Jim Fitzpatrick:

Yeah, okay. I I would agree with that. But it but it might be able to offset some of, like you said, of BDC people or operators or receptionists or follow-up people or things like that.

Alex Perdikis:

So we're using it um, you know, not to get into other stuff, but you know, we've we developed another system that we're using with our tech company, and okay, and it's just been uh unbelievable the the response we're getting from the clients, yeah, the ease of use, the appointment setting, and then the AI sets an appointment and then and then it uh you know immediately turns it over to a group of managers. Um so Inride is a is an automotive tech company that that I own that we started years ago. Right. And long story short, uh the we recently developed our own agentic AI.

Jim Fitzpatrick:

Okay.

Alex Perdikis:

And so we call it's called TradeAgent AI. And so it's built to follow up with your with your with your database, yeah, your current database of existing sold customers. Okay, and it reaches out to them kind of bespoke based on what you're trying to you know trade in or what what your messaging wants to be, whether you're trying to go after certain vehicles, makes models, whatever it might be. It reaches out to them directly, offering is and it offers up um an opportunity to get an appraisal. It will give them a live evaluation, a live number on the spot. Wow. Based on answering a few questions.

Jim Fitzpatrick:

Yeah, we have a oh my gosh, that's that's fantastic.

Alex Perdikis:

We have a an API set up with uh an appraisal system that we developed, and then it goes for an appointment. And so wow, and then once the appointment's set, there's zero human involvement. Once the appointment's set, it goes right to uh right into the CRM and then it it hot leads, you know, hot emails the a group of managers. That is really cool.

Jim Fitzpatrick:

Again, again, what is the name of the company?

Alex Perdikis:

Uh it's Trade Agent AI um by InRide. So InRide's the company.

Jim Fitzpatrick:

Okay.

Alex Perdikis:

And Trade Agent AI is our is our you know is the product we're offering.

Jim Fitzpatrick:

Very cool. Yeah, it's really cool. And it can do it by the hundreds, you know, throughout 24-7.

Alex Perdikis:

Thousands.

Jim Fitzpatrick:

Thousands. I mean, yeah.

Alex Perdikis:

And we have a follow-up pattern that that we've developed using using our dealership uh mod or other dealerships as a as a guinea pig, more or less, right?

Jim Fitzpatrick:

So work out the kinks or whatever.

Alex Perdikis:

Perfect it, perfect it over time, and it's empathetic. It responds to, you know, like if you had a tragedy, it I mean it's it's it's crazy like what it does, and it's learning, and we we're teaching it different things as uh as we've gone along. So it's pretty it's pretty cool. So that's where I see if you use AI properly, yeah, like you can definitely you know leverage it, you know, leverage, leverage it and and not have and and definitely cut some cut some cost areas or more than anything and save time for your your people. That's kind of cool.

Jim Fitzpatrick:

Yeah, no question about it. Yeah.

Alex Perdikis:

Yeah.

Jim Fitzpatrick:

Yeah. And to have a staff doing that is would be almost impossible.

Alex Perdikis:

Impossible.

Jim Fitzpatrick:

You're right. I mean, you'd have to have to.

Alex Perdikis:

You don't have to worry about bad attitudes, you don't have to worry about people being sick, not showing up to work.

Jim Fitzpatrick:

Yep.

Alex Perdikis:

They're out back talking about the game last night, the Bears beat us, we're all angry.

Jim Fitzpatrick:

Or how much you're not paying them.

Alex Perdikis:

Yeah, right, exactly.

Jim Fitzpatrick:

Oh, wow. Alex Perdikas, CEO and owner of Koons Motors. Um, wow, thanks so much for uh joining us today. This this has been really good. We'll show some of the information here on the screen about that technology that he's talking about. Check it out. If if I could have somebody reaching out to my former owners and offering them uh, you know, uh appraisals right over the phone in real time. That's pretty cool. So

Alex Perdikis:

yeah- thank you, Jim. I appreciate it.

Jim Fitzpatrick:

Yep, absolutely. Thanks. Stay well. Absolutely. Thank you, buddy. Take care.

Announcer:

Thanks for watching Inside Automotive with Jim Fitzpatrick.