Inside Automotive with Jim Fitzpatrick, powered by CBT News

Steve Greenfield on Profitability, Tariffs, and AI in Auto Retail

• Jim Fitzpatrick • Season 1 • Episode 36

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In this episode of Inside Automotive, Steve Greenfield, CEO of Automotive Ventures, breaks down the current state of the retail automotive industry and explains why dealer profitability remains strong despite tariffs, economic pressure, and shifting market dynamics. He highlights how the industry has transitioned from volume-driven strategies to more disciplined, profit-focused operations, and offers practical guidance on where AI is delivering real value for dealerships.

Key topics explored:

  • Why dealer profitability remains elevated compared to pre-2020 levels
  • How tariffs are impacting automakers more than retailers
  • The shift toward operational efficiency and stable revenue despite lower SAAR
  • Practical, high-impact applications of AI in sales, service, and CRM
  • Evaluating new technology ahead of NADA 2026 with an ROI-first mindset
  • How digital-first competitors like Tesla and Carvana are reshaping consumer expectations

Greenfield also shares examples of AI tools improving warranty processing and workflow efficiency, emphasizing the importance of adopting technologies that demonstrate measurable, strategic outcomes.

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 CBTnews.com. Innovation in the auto industry shows no signs of slowing down, as many of you know. Few people have a better pulse on these trends than our next guest. You know him well. Joining us in the studio is Mr. Steve Greenfield, CEO and founder of Automotive Ventures and host of the Future of Automotive right here at the CBT Automotive Network. We're so happy to have him in the studio. This guy's all over the world. Steve's constantly on the move meeting with innovators across the globe. He's here to share what's hot, what's not, what we should be focused on, some maybe some new innovations out there that we need to keep an eye on as well. So, Steve, what a pleasure to have you in the studio.

Steve Greenfield:

This is always great. Always great to be here. So thank you for having me.

Jim Fitzpatrick:

Well, we appreciate all of the content that you give to our viewers over probably the last five or six years now, right? I mean it's been it's been fantastic. So we appreciate it, and I know they appreciate it. So let's kind of jump right in here from your perspective, and as I mentioned, you're all over the globe. I mean, you're you're an international guy now, right? So uh and you've got your hands, as I said, on the pulse of all things. How would you describe the overall state of automotive retail today?

Steve Greenfield:

Yeah, well, it's been resilient, right? I mean, I think you look at the beginning of the year, a lot of people were concerned with the tariffs, so the SAAR would get a big hit. That's right. And for whatever reason, consumers continue to buy. Yeah. I think a lot of that is because of the convenience and the the um the opportunity that dealers provide. You think of dealers? Dealers will sell. You give them cars, they will sell cars.

Jim Fitzpatrick:

That's right, right. That's right.

Steve Greenfield:

And the the production has continued, yeah, and dealers have been able to sell. I think tariffs have largely affect the OEMs so far. They've absorbed the losses, they haven't passed them through to the dealer, right? And only a few of them have really uh represented that in a higher MSRP. Sure. What happens next year? I don't know, but I cut up with Jonathan Smoke from Cox Automotive yesterday. He feels yes next year is gonna be a good year as well. Okay, you know, solid, not a record-breaking year from a SAARS standpoint, but pretty resilient. And there is an upside as well next year, depending on the economy. So I think that um it's been good for dealers. Yeah, you know, they continue to be profitable, not as profitable as 2022.

Jim Fitzpatrick:

No, no, no. But that was a high water market-

Steve Greenfield:

But more profitable than pre-COVID still. Yeah. And they figure out ways to run their operations with less cost, which is great.

Jim Fitzpatrick:

Right.

Steve Greenfield:

Cost discipline has been contained through. And I think that um luckily enough, the consumer keeps buying cars and servicing their cars. So for the time being, we've got to really keep a close eye on consumer confidence, but for the time being, things are good in dealer land.

Jim Fitzpatrick:

That's right. And I think since COVID, would you agree that dealers are like, hey, if we don't hit 17 and a half million SAAR or chase 18 million, you know, one day or whatever, is not that doesn't matter to us. It's all about now how much money we can make out of our dealership. And if it's on less cars and we hold stronger gross profits, then so be it, right?

Steve Greenfield:

Yeah. I mean, Kevin Tynan, who you know quite well, is now over at Presidio, he he really articulates this better than I've seen any any other analyst. And the fact that with MSRP inflation, now that the average new car is 50 grand, when you multiply that by 16 million, the actual value of cars that we're selling is much more than it was ever in the past. True. So while we fixate on SAAR, but remember SAAR was at a $30,000 car.

Jim Fitzpatrick:

That's right.

Steve Greenfield:

Right pre-COVID. Now we're at a $50,000 car. Multiply that by $16 million or whatever we're running at. And actually the value of cars, which means dealers' opportunity to get gross margin off that value of cars is higher. The OEMs are actually calculated. OEMs are less fixated on number of cars and more on total revenue. Right. That's what Wall Street wants. Yeah. And how much margin you can make off that revenue. So I think you know, we are fixated so much on SAAR, and that isn't necessarily the way. And Kevin was the one that really opened my eyes to that.

Jim Fitzpatrick:

Yeah, it's a good point. Yeah, that's a good point. Yeah, it really is, no question about it. Um, you got a front row seat on all these emerging technologies, obviously, with with your with your company. You're looking at these companies, you're investing in some of them around the world, and and uh what what what's new in the way of innovations and some of the trends that you see out there? And what what what are the ones that you're keeping your eye on? Or maybe investing in.

Steve Greenfield:

Yeah, sure. So so uh as you see in the press, everything is all AI all the time. I I do worry that you know dealers are already getting numb to that.

Jim Fitzpatrick:

Yeah.

Steve Greenfield:

And you know, everyone's got some AI widget for their selling. By NADA, every single booth is gonna have something AI related. And dealers aren't gonna be able to discern between them, right? So but I think it is interesting. There are some interesting use cases. I think the most powerful one we've seen out of the gate is just phone answering. Yeah, there's a number of these companies out there, dealers can literally never miss a call again during working hours and after hours. And the dealers I've talked to said these are well worth the money they're paying because now it's my first line of defense. And a younger generation of folks, not us, but a younger generation, are now used to not getting a human on the call anyway. They might prefer not talking to a human. I want to get through to Delta and talk to someone, but a lot of younger people I don't think do. And you know, AI now is getting smart enough to take the in-bound calls. What gets me really excited will be phase two of that, where where they can mine the CRM. And like, you know, I've got a BMW out here in the parking lot. Uh last time I was in for service was two years ago, I hate to say that, and they rolled me up for a $3,000 job. How many times do you think that BMW dealership in Atlanta? I won't name the one. Right, right. There's only a couple has contacted me. Hey Steve, um, I'm a little concerned. I haven't seen you come back in for that $3,000 job. We'd love to have you back in.

Jim Fitzpatrick:

Right.

Steve Greenfield:

In two years, not once. Not one, not once. Not once. Wow. And this is a sophisticated owner, I can tell you.

Jim Fitzpatrick:

Yeah.

Steve Greenfield:

Um, but you know, I so I think there's all kinds of opportunities. AI should be harvesting, mining the CRM, finding opportunities like that, right, and um plucking them out and then figuring out how I want to engage text, email, phone calls, whatever it is. And they make it really easy for me to say, yeah, I want to get that $3,000 job done.

Jim Fitzpatrick:

Of course.

Steve Greenfield:

Um some dealers do a good job of this, but I think that um we are on the cusp now of unlocking all kinds of better consumer experiences and more revenue and profit for dealers off of just like very simple applications of AI.

Jim Fitzpatrick:

That's right, that's right. And even with companies that are that consider themselves progressive and advanced companies that have got, you know, call centers that are size of a football field to handle all of their different calls coming in, AI still blows that away. Right? I mean, the the the the biggest call center in the world can't handle what AI does 24-7 around the clock, whether they're receiving phone calls to set appointments, or out outgo, you know, outbound calls as well, right? Yeah. I mean, there's just you just can't do it.

Steve Greenfield:

You can't do it. I mean, you know, if you took the best salespeople on the face of the earth, you've probably met them. These people sell like 40, 50 cars a month fairly consistently. And like when I've seen these interviews with these people, it's just that they have a really big Rolodex and they're very thoughtful. That's right. You know, they they they reach out to you on your birthday.

Jim Fitzpatrick:

That's right.

Steve Greenfield:

And they say, Jim, how is life going?

Jim Fitzpatrick:

Yeah.

Steve Greenfield:

How are your kids doing? They they know your wife's name, they know your kid's name, etc. And they're just very thoughtful, building long-term value with you. So you you would never think of buying a car from anyone else. Yeah. And you're gonna go back to you know, Bob or whoever it is who's your salesperson. Um we could AI should be able to uniquely replicate that. You know, take those algorithms, whatever those activities are that are in the heads of the best people, best best salesperson, best FI manager, best fix ops person, best technician, and then distill that down to their essence, replicate them, and now every dealer's the the the the tide will rise, all ships, right? Every dealer should be a great operator because we're gonna be able to complement humans, even if they're new employees, with the best practices in America of the best operating dealers. And this is really, I think, the unlock for AI. We have to see that. But I think when when that happens, there'll be plenty of companies for folks like me to invest in, sure. And all kinds of benefits for dealers overall, to just like augment their employees with best practices, real-time best practices, kind of like guardrails that will keep them out of trouble, but make sure they're on the straight and narrow at all times to just be doing the best things to generate more revenue and profit. So I I think that we are very close to seeing this kind of unlock for dealers.

Jim Fitzpatrick:

And there we should say too that there's some dealers, I mean, there's some vendors out there, uh, as you know, you know, you go for for these dealers that are visiting NADA in just a few months where they say they have AI. They're still kind of working on the AI. You know what I mean? I've heard from dealers that say, ah, this company sold me uh not a bill of goods per se, but they said we have AI, this is what we'll do, and at the end of the day, it ain't working that way, right? But they got you in to say we got AI. We got AI. That's right. Check the box.

Steve Greenfield:

Do you do you see some of that out there where you're like, what I would recommend for if I'm a dealer, NADA is now in two months or three months, whatever it is. I'd say, look, start with what your business objectives are. Okay, right? Because it is gonna be you you will you will get numb walking that floor with a lot of people pitching you a lot of stuff, and you won't be able to know what's real, what isn't real. But you know, if I want to um have uh increase productivity for my salespeople.

Jim Fitzpatrick:

Yeah.

Steve Greenfield:

My salespeople sell 10 cars a month, and next year I want them to sell 12 cars a month, right? Then that's a challenge for a vendor. You say, how do you help me hit my business objectives? If I want to increase my fixed operation absorption overall next calendar year, these are things where I would have a strategy, come to NADA with the strategy, talk to probably your existing vendors and challenge them, but then any vendor that's pitching some crazy AI thing, align it back to what your business objectives are for next year. Because I think it is going to be tantalizing for a dealer to say, oh, I'm gonna go try this, I'm gonna go try this. I know, I know. And rather than chasing shiny objects, reconciling it back to what they want to accomplish next year, what improvements in the business do they want to make, I think will be a good lens through which they can challenge their existing vendors and look at new vendors and not get enamored with some new AI widget that may or may not provide value aligned with where you want the ship to go.

Jim Fitzpatrick:

Right, right. So that's great advice, yeah, there's no question about it. Because there's, as I said, there's so many companies out there that are ringing the AI bell, and it as some of you have even sat here and said, we weren't quite ready yet, but we're ready now, okay? But they sold some packages to dealers, and I think they were maybe using the dealers a little bit of a guinea pig out there, right? Yeah, yeah. But um, so in terms of uh 2026, as because it's right around the corner, um, another good year in the business from your perspective, from all things that you're watching and and and the people that you're speaking to, we should have another good year.

Steve Greenfield:

Yeah, I think so. I mean, we talk about dealers overall. Well, I think the consumer demand will still be there, right? We'll see what happens with consumer confidence overall, but for the time being, it seems like the current administration has their fingers on the pulse of consumer confidence overall.

Jim Fitzpatrick:

Yeah.

Steve Greenfield:

I think dealers have proven themselves. Like I've been in the industry for 25 years. It's amazing. Every single year, they're profitable.

Jim Fitzpatrick:

Yeah.

Steve Greenfield:

Um, they can they can uh reallocate resources and their people into the departments depending on, you know, I get squeezed on new car, I can go to used car. I get squeezed on a new car and go to F&I, I can go into fixed operations, etc. Dealers have been proven to be very resilient and innovative in terms of allocating resources around. I think that fixed ops is gonna continue to be a more important area. Yeah. I think of dealers like there are controllables and uncontrollables. What I can't control is if my OEM makes good product that consumers want. What I can't control is how much front-end gross the OEM is gonna permit me to have. The things I can control is which used cars I stock.

Jim Fitzpatrick:

Yeah.

Steve Greenfield:

Uh I can control how much I invest in my F&I managers to attach more products and drive more back end PVR.

Jim Fitzpatrick:

That's right.

Steve Greenfield:

I can I can um definitely focus on how sophisticated my fixed operations are, selling more parts, selling more service overall. So I think dealers just have to really look at their entire operation through what can I control? What levers can I pull to grow? Where should I not worry, not lose any sleep, um, and um focus on those areas where they can grow and then work with their vendors to say, look, I need to energize more absorption or fixed ops revenue, profitability. Um, how can you help me?

Jim Fitzpatrick:

Right.

Steve Greenfield:

And if the answer is like we can't help, then maybe it's time to look at another vendor.

Jim Fitzpatrick:

That's right.

Steve Greenfield:

But you need to really be crisp around the things you can control and where you can get the most advantage for the least amount of effort.

Jim Fitzpatrick:

Yeah, for sure, for sure. And for those dealers that are out there, you know, I've heard I've spoken to some of them where they, you know, that some of these vendors, man, they'll have you sign up for a one-year contract that you can't get out of, right? Only to find out that they didn't quite have the technology that they presented themselves as, you know. So be careful of that too, dealers, that uh, you know, you don't sign in.

Steve Greenfield:

I think m most vendors now, thankfully, are like month to month.

Jim Fitzpatrick:

Yeah.

Steve Greenfield:

And and realize they have to prove their value every month or they don't re-up.

Jim Fitzpatrick:

For sure.

Steve Greenfield:

Uh but yeah, I mean I I I would echo exactly what you said. Uh when you start talking about a year or longer, you gotta really question what you're getting into.

Jim Fitzpatrick:

I know. Even though it's uh might be appealing to go, well, if you sign a 24-month contract, will you really bring that monthly rate down a year in and all of a sudden guess what? You just sign up for two years with the wrong vendor, you know, because they don't have what you what you thought. Well, so let's talk about used cars since you you mentioned that. Um that is a sticky field right now. I mean, with the price of used cars, and then the every dealer is challenged in the acquisition of these cars, everyone's buying cars out of the service lane, which seems to be a successful way to go, buying them off the road. Um, any thoughts on on the used car business?

Steve Greenfield:

No, just that I mean you know car Carvana wants to get to now to three three million cars sold a year. That's a longer term goal. They've been very successful buying cars off the street. CarMax is the same as well. So I think dealers need to up their game, right? It used to be that if you built a good centralized buying center you know in your local area, you could have at it, right? And you could pick off the cherries and pull in really good cars off the street. Now I think that everyone, the competition's increasing. So dealers need to um increase their game themselves, hire great people, um, look to their vendors at where they can help, but they need to figure out how they can continue to get a good source of vehicles. I think a lot of dealers are fatigued about the auctions with fees, right? I hear that a lot. I guess that's primarily what's driven Carvana and CarMax to get independent. That's right. Say, look, we're just gonna like build our own competency with buying cars directly off the street. They've been very successful, but I think studying those experiences of a dealer, like go through and sell a car to Carvana, sell a car to CarMax and see what they do. Um I think and then replicate the those elements that you think are really good and sticky with the consumer. But um I think that the the challenge, the beautiful thing about America, there's a lot of competition. Yeah, the bad thing about America, there's a lot of competition. I think every year it's gonna get you know more and more intense. You get these really big players that have unlimited budgets and they have really good customer experience. And you know, I talk to people in Uber rides around the world or whatever, and you talk to them, they're like, Yeah, I just sold my car to Carvana. And when you ask them, how was it? Like my dentist, actually, here not too long ago. I did too. She's like, she's like, you know, very sophisticated. I've been with her for 20 years.

Jim Fitzpatrick:

Yeah.

Steve Greenfield:

And she said, I recently bought a car from Carvana. I said, Well, what'd you buy? She said, I bought like a two-year-old Mercedes.

Jim Fitzpatrick:

Okay.

Steve Greenfield:

I said, Well, how was the experience? She said, It was amazing. And this is a dentist, a sophisticated. She said, She said, I went to the vending machine and I put in the coin and it went and retrieved my car and brought it. And when the this is what she said, literally. She said, when the car came down, it spun around and there was a halo over top of my car.

Jim Fitzpatrick:

Wow.

Steve Greenfield:

And she said, I still have that coin at home. Oh my gosh. I'm thinking to myself, like, there is something to this. Like, it was the experience of buying more than the car. That's right.

Jim Fitzpatrick:

That's right.

Steve Greenfield:

That that and so I mean, we have a lot to learn, I think, from these companies that are intensely focused on the consumer experience. And how does a dealer build their own version of that? That's right. Right? And not just simply make it a transaction where like get more out the door. Because these these people, like, I I am I guarantee you she will buy her next car from Carvana.

Jim Fitzpatrick:

Yeah, I've heard that from a number of people. That's crazy. A number of uh family members uh have purchased from Carvana. Sorry about that dealers, but a number of family members have, and they said the same thing. My our next car will definitely be through Carvana, not because of the car, because you can buy that car anywhere, but because of the overall experience. And uh so I think we do have a lot to learn. I, sorry to tell you, sold my car to Carvana. And but before that, I said, well, listen, I'm in the industry. Let me call around to it's a BMW, let me call around to some BMW dealerships and see if they want to buy, you know, my car. And uh it was in mint condition, it was a 645 BMW and or 650 BMW, and uh great condition, low miles, the whole deal. Everybody wanted me to bring it by the store to take a look at it. Before they give you a price. Before they give me a price. They gave me a range, give you a price. Well, we gotta but we gotta see it. I'm busy here in the studio. I'm like, let me just let me see what I can do with Carvana. Took a picture of the license plate, right? Sent it over. They're like, oh yeah, boom, here's here's the price. If it's what you say, here's the price, and we'll come out and pick it up. The guy came up with the flatbed truck. Here's your check, Mr. Fitzpatrick. Thank you very much, and off goes the car. Exact number that they told me online without ever seeing the car was what the check was made out for.

Steve Greenfield:

Yep.

Jim Fitzpatrick:

And I mean, you you can't beat that. You can't beat that. You know, and and this is what franchise dealers are up against. Right, you know?

Steve Greenfield:

And this is how Carvana buys whatever they're buying, 700,000 cars a year or something off the street. Incredible. And it's only gonna grow, right? So that's what dealers are gonna feel, like that's what you're competing with. That's right. That kind of convenient experience, transparent and convenient experience. And dealers might fight it because they want you to come in. They didn't want to give you the. They lost you. No, but they lost you. And I think that this is exactly you need to be mystery shopping, not only the other dealers in your marketplace, but these big marketplaces just to understand what is state of the art and what are consumers, how are consumers processing these experiences now? Because that's your competition. That's right.

Jim Fitzpatrick:

And you had a great idea there to for dealers to actually sell a car to Carvana, as many dealer friends of mine have purchased a car from Tesla to see how it goes, how it drives, but more overall, what was the experience like? You know what I mean? And um uh it it it to see firsthand what is it that is so appealing to consumers that they're gonna buy a car online and take delivery of it at $100,000 or whatever the price is. And a lot of dealers have said, wow, they were really amazed with how that whole process went down. You know? I mean, not the whole, it wasn't a perfect situation in every case, but it was an eye-opener for many dealers.

Steve Greenfield:

Yeah, I've never heard I've heard of dealers mystery shopping and selling cars to Carvana to their credit. I've never heard of them recording, like video recording the entire process. Yeah. And then sitting back in their sales meeting and playing it back. And then doing a play-by-play, like the NFL really, right? Pause. What are we hearing here?

Jim Fitzpatrick:

Yeah.

Steve Greenfield:

What elements of this should we we mimic?

Jim Fitzpatrick:

Right.

Steve Greenfield:

And what elements are we like, okay, we're never gonna do that. That's right. But let's be very deliberate with what our strategy is overall. And I think that uh that that needs to be done. Yeah because this is the competition.

Jim Fitzpatrick:

I uh whether we like it or not. That's right. And in fact, it was funny because I said to this one particular dealer, I said, Well, do you guys have a flatbed car uh truck that you can come out and pick the vehicle up? Because otherwise I've got to have uh you know a car behind me, my wife's gotta drop me off, whatever the case might be. And they said, Oh no, no, no, you gotta you gotta drop the vehicle off. We don't we don't have a a truck that's gonna that's gonna do that. Well, now I gotta take my wife's schedule and have her follow me out to the dealership. And as you know, in Atlanta, that's a two, three hour deal in Atlanta, right? In in traffic. And uh, but Carvana was like, nope, we'll come right out, don't worry about it, we'll be there at two o'clock. And sure enough, two o'clock came and the truck was sitting out there and and uh gave him the title and the key, and they were off in like 15 minutes. You know, it was it was really, really something to see. Yeah, so um so in terms of investments and opportunities, I know that's something that you live in every single day. What uh what's new, what's hot, what are what are dealers looking at right now? What are you what talk to us about maybe some of the big wins that you've got.

Steve Greenfield:

Yeah, yeah. So um, you know, I I'm really intrigued with this fact that uh 60% of a dealer's cost structure is human capital. I think AI is uniquely positioned to make all of your employees more effective, right? Increase more.

Jim Fitzpatrick:

Maybe less head capital.

Steve Greenfield:

Well, I think over time, that's definitely it. Like you know, I think that the the second phase of this is gonna be as people leave, right? Whether they quit or retire, right. You might be like, oh, I don't need to replace Sally or whoever or whoever it is, it's in the back office. But I think um right now I would be encouraging your employees to experiment with this and try to drive productivity. Yeah, I know for me right now, I mean, I use Chat GPT fairly frequently. Yeah, I mean, I don't know if you're using it too, but like just small little tweaks, right, that might you make your life easier. And things that used to take three hours now can make take five minutes. That's right. And it's amazing to me. Like, okay, well, I'll just give them three hours of my life back.

Jim Fitzpatrick:

Yeah.

Steve Greenfield:

And I think the same thing with your employees, like, you know, just being making sure they have a little bit of education around these tools and then giving them a little bit of empowerment just to stretch the boundaries a little bit, see how they might make their own lives easier. The good thing about humans is we're all lazy. Yeah. And we like to make our lives easier. And if you give me, if you give me a tool that will make my life easier, I'm likely to use it. I'm gonna like it and at work that drives more productivity. But to your point, then I do think that that's 60% of a dealer's cost structure. Five years from now, that's gonna be less. That might be 50% or 40%. All of that saving is gonna flow through to a dealer's bottom line. I believe in the future dealers are gonna be more productive because of AI, more profitable, and worth more because of AI, because we'll be operating bigger businesses with fewer humans, which can be scary, can be scary, but that that that's really the hope that I have overall. Um, you know, one of the best examples we have, well, the best company we've invested in by far is WarrCloud. Okay. You know, Jim Roche.

Jim Fitzpatrick:

Incredible, incredible guy, incredible company. Not a doubt-

Steve Greenfield:

I'm on the board of that company. We invested five years ago. It was our first investment, our best investment.

Jim Fitzpatrick:

And tell tell the audience what WarrCloud does. What the solution is-

Steve Greenfield:

It simply automates warranty claims back to the OEM. Yep. So typically a dealer either outsources that or has a clerk who manages that process. You put in WarrCloud, um, that clerk can go off and do something else. Um we replace the clerk, uh, dealers get paid faster.

Jim Fitzpatrick:

Yep.

Steve Greenfield:

Um and so it's a cash flow, a positive cash flow issue. Um, they also get paid more. Because what we found for across all the dealers, we have about 800 dealers on WarrCloud now. Um, you know, on average, dealers make 15% more per RO.

Jim Fitzpatrick:

Whoa.

Steve Greenfield:

Because there are reimbursements that that clerk may not be aware of. Right because it knows which boxes to check and how to submit. Wow. So dealers can take out the cost of the clerk, get paid faster, and get more revenue per RO. It's really a no-brainer value proposition for those dealers that have adopted. So um and Jim Roche, as you've met at the most. He's like, I just wish we had more entrepreneurs like him. I mean, he's just like an unbelievable entrepreneur, super steady hand. Yep.

Jim Fitzpatrick:

And by the way, he's had other successes in the auto space. So he needs to be.

Steve Greenfield:

He's written two books on fixed ops. I mean, he knows fix ops so well. Yeah. He's a subject matter expert, and I just think the world of him. So I mean we're very appreciative for Jim and what he's built, and it'll be a great outcome for that.

Jim Fitzpatrick:

And then that's that's a textbook case of like you said, where it's gonna be one of those areas that it can replace a human uh uh that you're paying for, you know what I mean, at the rate of forty, fifty, sixty, eighty thousand dollars a year. Those rates just keep going up. It's incredible. We've got to be paying people to join the organization. But uh but these are real huge savings. And uh the number of the dealers that I will talk to on air will say, well, AI is great, and you know, it's not gonna replace people, but it will give them a great tool, but I know it's gonna replace it. Yeah, yeah, yeah, yeah. This has got to do that. It will, right? I mean, and I'm not gonna hold them to it because obviously their staff is listening, like, oh, I better look for a job. But at the end of the day, the this has to, you know, bring down the headcount, bring down the human expense, and uh and it will, and it's doing it now.

Steve Greenfield:

Yeah, it will. And yeah, the learning experience from WarrCloud is how many roles at a dealership? I mean, you've run stores, I've never run stores, but I've walked around enough centralized accounting offices, and you talk to these people and say, what do you do? Well, I reconcile bank statements at the end of the day, week, or month, or I reconcile part statements and have a 50-page part statement in PDF that I have to open the bank account and reconcile all the stuff. And this is just, yeah, exactly right. We'll we will be able to automate all those roles to free those people up to do higher value things, right? But I do think over time dealers will say, Yeah, that's interesting. I'm I'm actually running my operation with far fewer people, right? Operating better with fewer errors, that's right, more efficiently and faster, and I'm more profitable. That's right. And that's a beautiful world for our dealers. And I think that uh you know AI will uniquely unlock more profitability for dealers, and I want to find vendors that are gonna help dealers on that journey.

Jim Fitzpatrick:

That's right, that's right, no question about it. Um will WarrCloud be out at NADA?

Steve Greenfield:

Yes, they will.

Jim Fitzpatrick:

Awesome. Check them out. If you're out there dealers, it's gonna be a big show.

Steve Greenfield:

And I hear you have a bigger booth at NADA.

Jim Fitzpatrick:

Boy, we are right in the middle of it all. I thank my friends over at NADA. We've got great positioning. Um we'll we'll I think we already have some 30 interviews lined up for the CBT stage, and uh it's always a big event for us because we are at the same time.

Steve Greenfield:

So, Jim, if I'm a vendor out there and I'm listening and I want to get on stage, how do I get on stage before?

Jim Fitzpatrick:

Come on, sell me, sell me. All our sales department. But it's really we it's amazing because we offer this package every year. We have now for you know probably 10 years. And uh, but so it's really we've priced it right. You know, you get an interview before NADA to drive traffic to your booth, and then we you get an interview at NADA that goes out immediately to all the social media outlets and on our website and everything else. And uh, and it's amazing because we'll make the announcement that we're now taking orders and it sells out very quickly for everybody that's already done it. They're like, this is a deal. Yeah, it's a no-brainer. Especially if you don't have a great location at NADA. Yeah, it helps to drive traffic over to your over to your website. So ask thanks for asking me about that.

Steve Greenfield:

No, of course, and I look forward to you. You and I always catch up out there. Oh, absolutely. Absolutely, absolutely. And seeing the bigger booth this year.

Jim Fitzpatrick:

Little bit bigger footprint in it in right in the middle. We're right next to Cox Automotive, right across from uh the the pavilion for NADA.

Steve Greenfield:

Primo Real Estate now, right? Wow. They must like you.

Jim Fitzpatrick:

I'm telling you. 13 years later, you got finally. That's right, that's right. No, but again, thank you so much for all of the great content that you provided uh to us and our viewers. They get so much out of it. We're so happy about all your successes with your companies. And I mean, you nailed it. You said, wait a minute, these these dealers are making money, but at the same time, they're also they're they're the guinea pig for all of these great technologies that are out there. And I know a number of dealers have said, well, how do we get in on that? You know, these companies are getting sold for hundreds of millions of dollars, and you've got dealers that go, well, wait a second, we were a big part of that that company's success. You know, we were we were kind of the the the beta for for in many cases, and uh you've been able to successfully bring those those parties together, you know, to say

Steve Greenfield:

Yeah, I mean i it's it's not really a secret, but more than half of our investors across our three funds are dealer principles. And I know they don't think that I'm the best investor in the world, but what they do get, we're now seeing 300 companies a month. Wow. They get visibility in those companies. That's great, and we always have space for direct investment from dealers. So I can't number name the number of dealers that have invested alongside us. When we invest, we do all the work, we we kick the tires, we do the diligence, et cetera. We we get confidence that we want to invest, right, and then there's space left for dealers to invest alongside.

Jim Fitzpatrick:

That's great.

Steve Greenfield:

So I think it's been great. I think that um, you know, the more that dealers are directing their our own money and investing in these solutions, the better. Right. Um and uh yeah, I'm excited to be on this journey, and I'm very honored to be trusted with so many of these dealers' money. Yeah. Um and uh it's been a great learning experience for me. I've I've learned a lot from our dealer pressure.

Jim Fitzpatrick:

Oh, I bet, I bet. And it comes at a good time because a lot of dealers, if they're not buying other dealerships, they're coming off of you know, pretty good five years. Last five years have been very good, and they want to deploy that capital, and if it could be in a technology that they're currently using among all of their stores, and uh it it's a no-brainer, right?

Steve Greenfield:

Yeah, I I get enough guys that have their wealth manager, Goldman Sachs or whatever, like, hey, I'm in some like healthcare or biotech fund. You're in the car business. I have no idea what these things are. I get these reports, and I've I can't even read these reports. The stuff that we invest in, they understand. Yeah, they can influence, they can take them to their 20 groups, and they can spread the gospel. I think that you know it's been a good fit. It's been a really good fit.

Jim Fitzpatrick:

Oh, no question about it. No question. Well, congratulations on all your success. We appreciate you and uh love what you're doing for us. So thank you. Uh uh it's it's just been great. So Steve Greenfield, CEO and founder of Automotive Ventures, all the information on the screen right here. If you got a little jingle and you want to get in on some of these great deals that Steve's put together, like WarrCloud, give him a call. You know, you're not gonna be uh sorry. In fact, count me in on you should cut me in because here you go just for giving you the little fire school finance. That's great. Thanks so much.

Steve Greenfield:

Thanks, Jim.

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Thanks for watching Inside Automotive with Jim Fitzpatrick.