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Episode #1127: We’re diving into major tariff relief for EU carmakers, Sonic Automotive’s EchoPark outpacing expectations, and how generative AI is rewriting the rules for online retail traffic.

Show Notes with links:

• The automotive industry is watching closely as the U.S. and EU hammer out a framework deal that could bring massive tariff relief for European automaker. The fine print could mean big savings and new market access.
  • The EU and U.S. announced a new trade framework aiming to reduce U.S. auto tariffs from 27.5% to 15%.
  • Relief would be retroactive to August 1 if the EU introduces enabling legislation this month.
  • In exchange, the EU pledged to cut tariffs on U.S. industrial goods and increase access for American agricultural products.
  • The deal may expand to include mutual recognition of auto safety standards and influence future U.S. agreements with Japan and South Korea.
  • EU Trade Commissioner Maros Sefcovic emphasized urgency: “It is the European Commission’s firm intention to make proposals by the end of this month.”
    
    
    
• Sonic Automotive just dropped its Q2 2025 earnings, and while a hefty impairment charge dented the bottom line, EchoPark's performance made sure the story stayed bullish.
  • Total revenue reached a record $3.7B, up 6% YoY.
  • Despite a $172.4M impairment charge, adjusted EPS surged 49% to $2.19, beating expectations.
  • EchoPark led the charge with $62.1M in gross profit (+22%) and a 679% increase in adjusted segment income.
  • Segment income rose from $3.9M to $11.7M — a 200% leap.
  • “EchoPark is just on fire,” said Sonic President Jeff Dyke.
    
    
    
• Adobe reports a massive 4,700% YoY increase in U.S. retail site traffic driven by generative AI platforms like ChatGPT and Gemini — a clear signal that AI is transforming the online shopping journey.
  • Traffic from gen-AI sources has grown monthly since the 2024 holiday season.
  • 90% of users trust gen-AI recommendations; bounce rates are down 27%.
  • Visits from AI referrals are 10% more engaged, with 32% longer durations.
  • The conversion gap between AI and non-AI traffic has shrunk from 49% in January to 23% in July.
  • “It’s allowing a very optimized, urgent, efficient journey,” said Adobe’s Vivek Pandya.

0:00 Intro with Paul J Daly and Kyle Mountsier
1:35 Next week, Paul and Erroll Bomar III will be at NAMAD next week
2:38 EU-US Finalizing New Trade Deal
4:35 EchoPark Boosts Sonic's Q2 Earnings
6:52 4700% Increase In Retail Traffic From GenAI Sites

Join Paul J Daly and Kyle Mountsier every morning for the Automotive State of the Union podcast as they connect the dots across car dealerships, retail trends, emerging tech like AI, and cultural shifts—bringing clarity, speed, and people-first insight to automotive leaders navigating a rapidly changing industry.

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Episode #1126: Today we’re joined by Steve Greenfield and talking about Hertz vehicles showing up on Amazon, VinFast’s new San Diego dealership kicking off a coast-to-coast franchise push, and how AI is helping Atlas become a surprisingly capable humanoid robot.

• Hertz has partnered with Amazon to list its used vehicles on the retail giant’s platform, giving customers a new way to shop for former rentals online. The move builds on the roughly one-third of Hertz’s vehicle sales that already go directly to consumers.
  • Shoppers can now browse and buy Hertz vehicles on Amazon, then pick them up in Dallas, Houston, L.A., or Seattle—with plans to expand to 45 U.S. locations.
  • Retail sales, add $1,000–$1,500 in value per vehicle for Hertz compared to wholesale channels.
  • Hertz is also expanding its “try before you buy” program to 100 cities and enhancing digital sales through platforms like Carvana and Autotrader.
  • “It is really important as well that we get more net out of what we’re selling,” said Hertz CEO Gil West.

• VinFast’s U.S. dealership network is taking shape with the grand opening of its first California franchise location in San Diego.
  • The new store, operated by Sunroad Automotive Group, offers sales, service, and test drives of the VF 8 and VF 9 electric SUVs.
  • The automaker plans to replace all 15 of its former company-owned California stores and now operates nearly 30 authorized dealerships across 14 states, with the company “recognizing the distinct advantages of this distribution channel” to maximize business efficiency.
  • California remains a key focus for the brand, which calls the state a “top priority” for EV growth.
  • The new location includes full support for warranty, repair, and maintenance using genuine VinFast parts.
  • “This event marks a pivotal moment in our strategy,” said Mike Nolte, VinFast’s U.S. VP of Sales and Marketing.

• Boston Dynamics and Toyota Research Institute are working to make humanoid robots useful in real life by teaching them complex, adaptable behaviors through massive AI models.
  • Many of us are familiar with Boston Dynamics, but Toyota Research Institute (TRI), a Toyota subsidiary, focuses on human-centered AI innovations in automated driving, energy, and materials to improve the human condition.
  • The Atlas robot is being trained with Large Behavior Models (LBMs) to handle complex, long tasks using proprioception (a robot’s internal sense of position and movement), vision, and language prompts.
  • These AI-driven policies allow Atlas to walk, crouch, grasp, and manipulate objects with surprising dexterity—even reacting intelligently when things go wrong.

Join Paul J Daly and Kyle Mountsier every morning for the Automotive State of the Union podcast as they connect the dots across car dealerships, retail trends, emerging tech like AI, and cultural shifts—bringing clarity, speed, and people-first insight to automotive leaders navigating a rapidly changing industry.

Get the Daily Push Back email at https://www.asotu.com/

JOIN the conversation on LinkedIn at: https://www.linkedin.com/company/asotu/

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Episode #1125: Today, we’re talking affordability trends, lead follow-up gaps, and a CEO who worked his way from intern to the top at Target.

• At the halfway mark of 2025, the Dave Cantin Group Market Outlook Report shows the U.S. retail auto market is a mix of high prices, resilient demand, and major structural shifts. Despite headwinds, smart dealers are still in the driver’s seat.
  • Affordability is the top issue, with 52.1% of buyers carrying negative equity and 84-month loans now nearly 20% of all new financing.
  • Consumers are sticking with their preferred segment but trading down in size and trim; value-focused models from brands like Buick and Mazda are gaining traction.
  • 40% of U.S. consumers say they’d buy a Chinese-made vehicle if it was 10% cheaper than other cars sold in the US, and 75% of dealers expect Chinese OEMs on U.S. lots within 12 months.
  • As OEMs take multi-billion-dollar tariff hits, dealers are thriving on a flexible playbook—parts, service, F&I, and used cars—with 61% of dealers expecting record revenue growth this year.
  • “U.S. dealers are proving once again how resilient they are and how sophisticated their customer-focused business models have become,” Dave Cantin Group CEO Dave Cantin said.

• Think the lead is dead after Day 3? Think again. A new Foureyes report analyzing over 8 million leads shows a 30-day close rate of just 16.2%, revealing how fast opportunities fall off — and where smart dealers can still win.
  • 73% of sales happen in the first 3 days, but 1 in 4 still close after that. Close rates drop from 12.4% to 2.3% on days 4–7.
  • Follow-up efforts also plunge after Day 3 — a “coincidence” that’s costing dealers real money.
  • Used vehicles close faster than new, but new car deals stretch further into the 30-day window.
  • Internet leads close slower but still produce late-month wins; leads created in the last week of the month have a 17.3% close rate.

• Target is making headlines as it promotes a true company insider to the top job. Michael Fiddelke, who started in 2003, will become CEO on February 1 — a move that reflects deep institutional knowledge but is sparking debate about the need for outside perspective.
  • Fiddelke joined Target as an intern and worked his way up through roles in merchandising, finance, operations, and HR.
  • He most recently served as COO and previously as CFO, giving him a broad view of the company’s levers.
  • He’ll succeed Brian Cornell, CEO since 2014, who will step into the executive chair role.
• “To be clear, we have work to do to reach our full potential,” Fiddelke said.

0:00 Intro with Paul J Daly and Kyle Mountsier
0:52 2025 Halftime Report on Dealer Reputation Webinar Later Today
1:31 New Auto Collabs episode with Technician Curtis Gardner
1:54 DCG Report Shows Affordability and Ch

Join Paul J Daly and Kyle Mountsier every morning for the Automotive State of the Union podcast as they connect the dots across car dealerships, retail trends, emerging tech like AI, and cultural shifts—bringing clarity, speed, and people-first insight to automotive leaders navigating a rapidly changing industry.

Get the Daily Push Back email at https://www.asotu.com/

JOIN the conversation on LinkedIn at: https://www.linkedin.com/company/asotu/