Welcome to this episode of The Friday 5 with Steve Greenfield, Founder and CEO of Automotive Ventures, an automotive technology consultancy that helps entrepreneurs raise capital and maximize the value of their business.
September Intel Automotive Business Report is out, and if you haven’t downloaded your copy yet, check out our in-depth analysis of automotive risk assessment, where we dig deep into the major industry trends that are most likely to impact operations and dealer profitability. You can get your free copy of the latest Intel report at AutomotiveVentures.com.
On Friday the 5th of this week, exciting news that Buick will be offering to buy out one of its US dealers who are unwilling to make the necessary investments – as the brand transitions to an all-electric lineup by the end of this decade .
Buick had 1,963 dealerships in the U.S. at the start of 2022. It’s worth noting that only 13 of those were stand-alone franchises — the majority have dual showrooms with GMC — so virtually every dealership taking a buyout would likely continue with other GM brands.
Buick does not plan to introduce any new internal combustion vehicles after 2024 – the year its first full electric vehicle is expected to arrive.
The Buick buyouts come after GM used a similar approach to eliminate about a third of its nearly 900 Cadillac dealerships in the United States since 2020. Cadillac offers have typically ranged between $300,000 and $500,000 per store.
The dollar amounts that Buick dealers will be offered to leave are unclear at this point.
Cadillac, like Buick, plans to stop selling gas-powered vehicles by 2030. GM requires Cadillac dealerships that have remained with the brand to invest an average of $200,000 in chargers, tooling and training for electric vehicles.
Buick was the only one of GM’s four U.S. brands to achieve an increase in sales in the automaker’s home country last year. It sold 179,799 vehicles, an increase of 11% over the previous year. This equates to just 92 new vehicles sold per Buick franchisee. But the situation has worsened this year – the brand’s sales in the United States fell 57% to 48,075 in the first half of 2022.
Hopefully the remaining Buick stores will be much more profitable after this downsizing.
And, as a result, the remaining Buick dealerships should see their valuations rise. If the brand’s transition to VE is successful. We’ll keep an eye out if other legacy OEM brands decide to go in the same direction as Cadillac and Buick and offer a financial incentive to buy out one of their US dealerships.
Companies to watch
Each week, we highlight interesting automotive technology companies to watch. If you read my Monthly Industry Intelligence Report, I feature a few companies each month, and we take the opportunity here on Friday the 5th to share some of these companies each week with you.
Today we have two companies to watch: One Dealer Lane and BiKube.
A dealer lane
One Dealer Lane is a digital motorsports platform. By eliminating the need for multiple systems and providing a centralized lending model, their system provides a seamless digital customer experience that improves productivity and profitability.
The reason I like One Dealer Lane is that the business was developed and built by dealers.
The company was born out of discussions between directors of Schomp Automotive Group and directors of Steamboat Powersports Dealer Group about the need for single-point sales software that enables dealers to deliver a more consistent and comprehensive customer experience in efficiency of the overall sales process, as well as the delivery of digital finance and insurance products.
One Dealer Lane was created to develop single point sales software initially capable of delivering a centralized loan center module integrated with bespoke motorsports protection products and designed to automate sales operations, offer transparency to customers and improve dealer results.
You can check out One Dealer Lane at www.OneDealerLane.com.
Our second company to watch this week is BiKube.
BiKube is an innovative new cycling safety product that communicates your presence directly to cars and trucks on the road, bypassing drivers who are often distracted, disengaged, disoriented or even hostile to cyclists.
Unlike other bicycle safety products on the market, BiKube does more than just warn the cyclist or driver of likely collisions. The BiKube incorporates patent-pending reflector technology that greatly amplifies the detectability of the cyclist to the vehicle’s collision avoidance systems, activating its automatic emergency braking capabilities to intervene and help prevent collisions with cyclists – which equals collision avoidance, not just collision warning!
The reason I love BiKube is that nearly 1,000 cyclists die and over 130,000 are injured in crashes that happen on US roads every year.
Don’t cars already have collision avoidance technology? Yes, the majority of vehicles are now equipped with sophisticated collision avoidance systems. But they were designed to see other cars which are large metal objects. Radar-based collision avoidance systems have great difficulty seeing small, non-metallic objects like pedestrians and cyclists.
Because cyclists have to share the road with cars and trucks, they are more at risk. Visibility is essential to be safe. BiKube increases the visibility of cyclists on vehicles and activates the collision avoidance system in cars to protect cyclists from collisions.
Radian’s BiKube optimizes the object detection capabilities of a vehicle’s own collision avoidance system.
You can check out BiKube at www.RadianBiKube.com.
If you’re an automotive tech entrepreneur working on a solution that helps car dealerships, we want to hear from you. We actively invest from the DealerFund Automotive Ventures.
If you are a dealer who wants to invest in AutoTech start-ups that benefit your business, let me know at Steve@automotiveventures.com. We are always accepting new investors in the fund.
The future of automotive retail has finally been released.
The book is my attempt to provide the industry with a framework for the various threats and opportunities swirling around and offer practical advice on how best to navigate the next 5-10 years.
In the book, I argue that our industry is going to see more change in the next 10 years than it has seen in the past 100.
You can find the new book on Amazon or just go to FutureofAutomotiveRetail.com.
If you have the opportunity to read it, write to me and tell me what you think. at Steve@automotiveventures.com. I would like to discuss it with you.
So that’s your weekly Friday the 5th, a quick recap of the big deals in automotive technology over the past week.
If you are a young automotive tech entrepreneur looking to raise money, or an entrepreneur trying to decide if and when to raise money or sell your business, I would love to talk with you.
Thanks for tuning in to CBT News for this week’s Friday Five, and see you next week!
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