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Tesla is killing Colorado’s auto industry!

No, not really, but it sure sounds that way in a news story about a new Colorado law….

“A bipartisan bill introduced this month in Colorado legislature to allow any automaker to directly retail their battery electric vehicles to consumers is a direct frontal assault on state franchise laws in Colorado and nationwide. If passed and signed into law, it would do grave and lasting damage to Colorado’s franchise auto dealers. Notably […] the fledgling bill is rightly opposed by the Colorado Automobile Dealer’s Association.”

So, I have some thoughts on this, and if you’re a fan of the show, you can probably guess what I’m about to say. 

First of all: this article is a couple weeks old, and the bill passed. Tesla can sell to consumers in Colorado. It’s happening. I can understand the dealers’ worries here, but in fighting this bill they were only delaying the inevitable… 

Before this law passed in Colorado, Tesla was already selling direct-to-consumer in other states… So they aren’t really disrupting anything in Colorado that they hadn’t already disrupted elsewhere. Colorado dealers would be better served learning from the states where Tesla has already set up shop, rather than fighting to stop Tesla from coming to their home state.

Secondly: Even if a state’s law says Tesla can’t sell direct-to-consumer, people in that state are still going to buy Teslas! Case in point: Tesla tried this in Texas – didn’t work there – and you see more Teslas in Dallas than probably anywhere, because it’s the outlaw thing to do!

Third: Nobody listens to me! Time and time again, I’ve talked about Tesla’s advantage over dealerships, and time and time again, companies act surprised when they pay the price for underestimating Tesla! 

Listen: If you’re a Ford dealer with all this money invested in your dealership and a franchise agreement with the manufacturer… you’re probably gonna get hit pretty hard by Tesla doing their thing. But that’s just because their approach works better than yours. It is what it is.

Companies like Ford might feel confident that they can still sell F-150s right now, but let’s see how they do once Tesla’s truck hits the market! Speaking of which, I had an interesting conversation with Jeremy on this week’s show about the design of the new Tesla Cybertruck…. 

…And by “interesting,” I mean we fundamentally disagree on it. I’m sure you’re all familiar with what I’m talking about, because it blew up on the internet after its unveiling. The Cybertruck has been divisive, to say the least. Jeremy can’t stand the design because it looks like something out of a 70s – 80s sci-fi movie, but here’s the thing: I really think that works in its favor.

To anyone who has kids, how many times was there a toy that all the kids wanted for Christmas but it was out of stock? They’re already predicting that’s what’s gonna happen, and we already have an indicator of it. Hot Wheels collaborated with Tesla on a $400 Cybertruck toy, and it’s already sold out!

The scam that these toy companies pull, which happens to parents every year, is that these toys probably aren’t going to be back in stock by Christmas. What’s gonna happen is little Johnny’s Christmas is ruined because he was a good boy all year for Santa but that holly jolly con artist didn’t pull through with the Hot Wheels Cybertruck. He’s going to realize Santa isn’t real, be bitter about his parents lying to him, and it’s going to make them feel pretty guilty.

Then, come February, guess what’s available in mass quantity?

That’s what toy companies do! They create something everybody wants, but they don’t make it available when everyone outside the lucky few needs it. Then, they end up getting something similar from the same brand as a consolation prize to hold their little Johnny over until they get the genuine article in February. But that was the crack in the dam and, by then, Johnny already knows Santa isn’t real.

Hell, I even put myself on the waiting list for one (the toy, not the truck; I’m not in the market for an actual truck) Why not? I don’t particularly like or dislike it, but that’s not what matters. I think, strategically, it’s smart because it pushes the envelope and gets noticed, even if it’s polarizing.

To better understand the business model here, you need to realize that there’s 350 million Americans and Elon Musk only needs 2 million to like it for the Cybertruck to be a success. I think it’s much smarter to get a loyal audience than trying to get everybody to like it. It’s definitely polarizing, yeah, but do you think it would have been talked about nearly as much if it was a GM pickup? If it had a borning, non-confrontational design where it could fit in anywhere but not stand out?

The standard American pickup we’re all used to has its spot in the market – don’t get me wrong – but I think it’s super smart for Elon to come in aggressively with this out there, stylized truck and that’s why you either love it or you hate it. Oddly enough, that’s a great place to be with a product.

Trucks are the highest selling vehicles, and they also create a lot of emotion. In the end, it’s way better to create that emotion and have people pick a side like they do with Ford vs. Chevy than it is to play safe down the middle, and that’s why I think it’ll work.

Q&A

With that, let’s break it up with some audience questions before I get into the 5 Sales Mistakes Advisors Make. Remember to submit your questions to [email protected] or on our YouTube or LinkedIn and, if we end up using your question on the show, we’re going to send you our sincerest thanks and some swag.

“I am looking to get some more advisor training, but my dealer is not a training kind of dealership. Do you have service advisor training separate from the dealer experience? I am very impressed by the podcast and the info in there. I have made my way to #1 at my dealer because of the information, but I am hungry for more. Please help. It’s hard in Lincoln, Nebraska.”

Here’s an idea: go to a dealer that does provide training. There’s hundreds of them; we got a roster here at Chris Collins Inc.

Jeremy gives some solid advice on this week’s show about investing in your own career. I once spent a total of $200,000 in one year on training for myself, but that’s just because I’m one of those crazy people who actually likes learning new skills. I’ve always been a fan of going to different kinds of training, because even if it doesn’t seem like it applies to what I’m doing, I always learn something.

“Hi, Chris. I am researching inspection software. I am a service advisor for Dave Smith Alfa Romeo and Maserati in Coeur d’Alene, Idaho. We currently have MPI, but do not use it consistently. What digital inspection software do you recommend? I would like to see us use one that is easy on the techs, and helpful for our guests.”

My feeling is that digital inspections, most of the time, slow the process down because we don’t have a consistent system, and if you can’t do it on paper, you can’t do it digitally. I always start with a good, old-fashioned two paper inspection sheet; getting the techs to do it right under the car. It’s easy, it’s fast, and stapled to every RO. But if you can’t do it on paper, you can’t do it digitally.

If you get good at paper, you’ll be good at doing it digitally, but we often buy the software thinking it’s a magic pill but it’s not. Garbage in, garbage out.

Top 5

Now let’s talk about the top 5 mistakes that advisors make in sales presentations. These are the mistakes that are directly cost them sales, so you’re really going to want to pay attention and see if you’re spotting these in your shop:

1. They are not prepared for the presentation.
   They simply pick up the phone and they wing it. How do you prepare for a sales presentation? You’ve got to have the customer’s primary concern dealt with and have an A, B, and C game plan for what needs to be addressed; have all the numbers ready so that they can make a decision without needing a calculator.
2. They’re not focused.
   They’re just not focused on their job, the customer, or the outcome; they’re distracted. 100% of your energy and passion needs to be put into the presentation, and a pro needs to lock themselves off from the outside world. Listen to customer clues and deal with objections before you move forward.
3. T vs. R: Transactional versus Relationship.
   I’ve dealt with people before where I could tell they didn’t care about me at all, and that was at the DMV and with the TSA. A lot of advisors treat their customers worse than the TSA agents do (minus the cavity search). I’ve never had a TSA person so much as to ask me how my day is. They could care less. For things to go from transactional to a relationship with a customer, you got to understand that the decision you’re helping your client make today ahs financial consequences in the long term, and you got to be there for them every step of the way.
4. They didn’t pet the dog.
   Over 80% of successful sales depend on what you do at the vehicle drop off. When the customer comes in, they judge based on that initial face time whether you genuinely care about them or not. Some advisors think that customers are cattle who need to be corralled into the slaughterhouse to feed the business, but customers obviously don’t want to be treated that way; no one does! They’ll be able to tell if you do, so you need to build a strategy for connecting with the customer on a personal level. The second thing is you got to plant the seed for later on that you’re going to do the inspection so they don’t get caught off-guard when you call them later.
   If you start off the presentation with, “Hey, my technician checked it out and found some things that should be addressed,” then you’re the hero.
5. They do NOT have a sales coach.
   There are plenty of things a sales coach would help a service advisor out on, especially with presentations. Just thinking about myself, the first one is mindset and tools. The second one is roleplaying and practice. A lot of advisors don’t have any tools, and they’re practicing every day through trial by fire with live customers. That’s not only the most expensive form of practice with any sales job, it’s damned wasteful, too.
   The biggest thing I would say when I’m coaching advisors is to shut up. What I mean by that is most advisors talk people out of it. They either sound nervous or they see the sale through their wallet. The point of the sale isn’t to improve the value of the customer’s car, the value you’re selling is that the service is going to keep them safe when they drive their family around, or go to work or school. That sort of thing.

And the bonus 6th mistake is… It’s all the Parts Department’s fault.

With that, I hope you got some tools that’ll make you think a little bit different, and I hope this week’s show makes you laugh a little bit. Thank you to everyone who submitted a question; always appreciated. We’ll see you again next week on Service Drive Revolution!