#316 - Putting AI In Automotive Inspections

This is the Independent Dealer Podcast, Education by Dealers for Dealers. Now, here are your hosts, Luke Godwin and Jeff Watson.

Hello and welcome to the Independent Dealer Podcast, brought to you by Buckeye Dealership Consulting. Luke, there's one thing I always argue that we could use more of, and it's not fancy software. It's not, it's not bells and whistles, it's not more caffeine. What is it?

It's more intelligence.

From.

From you, Jeff, not from me. I'm. I'm intelligent enough.

Yeah, yeah, you got it coming out your ears and you make sure everyone knows it. But for the rest of us, there is a level of additional intelligence and we leverage technology for these things. Right. To make our job easier, faster, quicker, get more insights.

I think you just, I think you just like this, this artificial intelligence just so you don't have to work as much. Jeff.

No, that's absolutely it. If I could get the same productivity with less work, yeah, sign me up, man. And I love spending an extra 4.99amonth on some new widget, so that's really exciting too. But what's going on here? And we've got Mr. Elrond from Raven AI, who's going to talk to us about how AI is helping condition reports. Never thought about that, Right. I always thought AI was going to replace my salesman, you know, know my mechanics, my title girl, my lot boy, myself. But he's using it to help replace and make condition reports more, I don't know, consistent. Easy, Elon, thank you for being here. Maybe tell us, how did you get into this? Where did this come from? And what is this Raven AI, thanks.

And really appreciate the opportunity to be here and, and talk to you guys. You know, the main idea behind Raven was to use ordinary cameras like the ones we have in every dealership, CCTV type cameras, or our mobile phones to enhance condition reports. So we all know condition reports are highly subjective. They're really dependent on the person that is completing them with all the tools we can put at their disposal in the end of the day, if they have an interest to show more damage, less damage, report something or miss something, that kind of comes down to them, which creates a real problem of trust in our industry. So what we set out to do is actually make that more consistent and bring more information to the table using artificial intelligence.

Yeah, what's, what's so funny? What's so funny is like if you surveyed 100 dealers, there's going to be a pretty, pretty big consistency when it comes to what is the one problem with buying virtually and that's going to be the subjectivity of a condition report and how someone took a picture or what the grade was. Why did it take so long to, to get someone an artificial intelligence bottom of doing this for us? What, why did you take so long to come to market? Come on, what's wrong with you?

Yeah, it's, it's a good question. I think it's a, you know, the, the first of all, the tech itself has gone a long way. It's come a long way since the beginning and the models that allow us to do what we do are there finally. Also, the processing power within mobile phones has really improved. The things you can do today with cameras are amazing. And then it took some time for us to actually persuade dealers and other players to get there and use artificial intelligence. That was the main point. And I think for our perspective, we came to this actually collecting data from other industries that allow us to come to that sort of quality. So we actually started in rental car companies and collected like billions of data points from those cars, accumulated that body of knowledge about car's physical condition and now bringing it into the dealership space.

Hey everybody, real quick. Talking about AI and just using technology to be smarter with what you're doing in your job. We switched over to Blitzpay and why they haven't instituted an AI agent yet. On the collection side, I do, you know, I keep pushing them for it. Hopefully it's in the works. But it has automated and speeded up my collections process because it's so easy to get payments from customers. Send them a text link, we set it up on auto text, they text back with their payment or they log into their portal, do their own thing. It's really, really sped up and helped our collections.

Yeah, for sure. Jeff, I shared with you the other day, our last two Friday closes have been the best delinquency numbers we've ever had. And I, I keep a lot of records and I, I contribute a good bit of that to, to my collector's hard work, but also the ability to be helped with how Blitzpay can get payments in the door. So switch, get it done, save some money and get better collections because that's what it's all about.

Make sure you call them and say that the independent dealer sent you because they do have a promo code when you say that Luke and Jeff sent you over. So it's really important when you contact them, say Luke and Jeff told me to come, they're going to give you three months of the software system for free and three months of the Cash Network, which I heard is launched. It's in beta with some dealers and they're working through some of the bugs. But within the next 30, 60, 90 days, that cash Network will be open to everyone. Which means for me, amazing. I have a lot of cash payers because of my demographic of customer. No longer do I have to worry about deposits in the office. I look forward to that day where I'm not counting deposits and making sure the cash was brought in and worrying if we had a big collections day and I didn't make it to the bank. So that's going to be awesome. Really look forward to that. But call the guys at Blitzpay. Get signed up now.

I mean, I know nothing about technology. Everybody on the podcast knows that, Jeff knows that. And I never even would have thought about having to, to pull the data before you can use the data. Is, I mean, is that how this. I mean, I guess if you talked about being in the rental car space before this and I mean how many cars are rented every day and that data builds kind of quickly right on the shape of the car, everything.

Absolutely. That's. That was, that was a great leap forward for us. So we're talking like thousands of cars from every like US airport that is going through. These are massive volumes. And you can actually track the car like sometimes, like within three days the car would come back slightly dirty, slightly damaged and you would start building your intelligence on that car, the profile of that car, how it's being used. And that's what really dealers are looking for. If you think about a dealer communicating with the customer, the only way for them to actually promote the deal is to get them in. Like they'd call someone up, just get in, come make an appointment and that's a win. You know that they're kind of halfway there the moment they step through the door. But how do you get them in and how do you use their information that they're giving you to increase the likelihood of a transaction? A tradesman. That's what we're busy doing.

That's really interesting when you talk about pooling the data. You it there's probably certain cars where you could pull that data. You know, I think they call it the Camry corner. Is that what they call it? Luke, have you ever heard that term, the Toyota Camry? Every single Toyota Camry within like a, I don't know, it was like 2012 to 2018. They all have that dented in corner, that little corner squished in on the rear bumper. Every single one of them. I think there's like entire Twitter pages or Reddit pages dedicated to the Camry corner. But I bet you could find that with certain cars. Like, hey, you know, I mean, I know every single Tesla is curved rash, right, because they're slightly wider than a typical car. So every single Tesla.

Ask my wife. Ask my wife about that.

Ask her about my Yukon. I about came ung glued on that.

One the other day. But.

So give me the practical application, Elon. You're saying that dealers take your software or they send it to the customer, or the customer can use it somehow to upload or send the dealer videos or pictures of their car, and this thing will scan it and overlay damages or tell the dealer what is not. Right?

Right. So what happens is the dealer would engage the customer, whether it's direct from the CRM in an automated fashion or as part of a conversation. You know, you're calling up the dealer, you've got your Camry, you know what's wrong with it. They probably know what's wrong with it. But, you know, they'll say, come over. I'll give you the market price. I'll give you a good price. And you'll say, oh, but, you know, I. I want to know exactly how much you're going to give me. I don't want the, you know, whatever the KBB figure that I have because I know it's low ball. I can get better number from someone else, maybe from Carvana for someone else. And you say, and then you go, okay, but I'll need a bit of information. And then they'll send you the link. And the moment you open the link, the AI experience just kind of takes over. And not in a freaky way, in a very fun way, just tells you to walk around your car and allows you to show the car at its glory, with the dents, with the scratches, but also in general, just making sure that the car is actually not that damaged. And what we give back to the dealer on the other end and, and pretty much instantly is a condition report that says, this car is probably a 4.5, a 4.8. It's not a 3, it's not a 2. It's something you want to go for. And by the way, we already create your remarketing shot so if the car is completely clean, they can actually post it for sale.

Oh, just takes out the background.

And yeah, you can do all of that. All the. All the images are already cataloged and you've got the condition report. You've got everything in the vdp. You can put it on your website. That's done the whole trade already. You just need to sign the check.

And that's. I mean, so Jeff and I both have a vehicle buying center. And a lot of the issue in the figure that it gives to the consumer is that it's always, not always, but 90% of the time really high for the condition that the car is, that the car is currently in. The ability to, to send this to a customer to get a real condition grade is. I mean, it's. That takes a lot of the, the guesswork out. It saves your. Saves everybody time.

Hey, Jeff.

Reinsurance, we talk about all the time. Last week we spent a whole episode talking about getting larger backyard grosses that you're a big fan of. So big fan. And reinsurance is the way to do it. You could set up to, to not automate, but really essentially automate your warranty penetration. Right. Or your CPI penetration. And really that's what we're looking for. We're looking to use our reinsurance company to make more money in the dealership. And Buckeye is the place to. To go to get that done.

Yeah. I want to share with you an interesting situation. I have two of the guys from Buckeye are flying out here to my dealership to help me do my first remittance and get my staff trained. So I mean to have two of them come from across the country. I don't know where Jason's from, Bent Armpit, Alabama or something.

Oh, no, he's. He's from Florida. Come on. From South Carolina, but he lives in Florida.

He's flying across the country to come here to my little town, to my little dealership to make sure that I get everything submitted right and help my guys get lined up. That's come in. Right. I wouldn't do that. I wouldn't fly across for 24 hours to be, you know, help somebody. But these guys are doing it, so it's really, really awesome. It just shows Buckeye is committed to each and every dealer, regardless of their size, to help them get it set up and get it running right. So if you haven't set up your reinsurance, your CPI, your VCs, all your acronyms, call the guys at Buckeye, get your acronyms lined up.

Will it do the same on the interior or do you not have that data yet?

So we are. The inspection includes interior as well. Obviously, if the engine is not running and they're failing to report that, obviously that's, yeah. Deal breaker. But other than that, all the usual things that you walk around checking are in there.

I mean, that leads me to a whole series of questions, but do you. Does it compare itself to other cars of that year? Make, mile? So it's like, hey, you're not a. You're not a perfect CR. You know, you're not a 4.8, but based on the other cars, because of your age and miles, you actually are a 4.8. Because, yeah, it's a 2000 Camry and you've got a dented bumper, but all of them do. Does it compare it against other peers, or does it just say a perfect car just rolled off the showroom floor and you're not that.

So there. There. We do. In the analysis, we do take into account some similar cars in your category may not be a Camry, but should be like, you know, an executive sedan or whatever that is in the year make model to do the analysis. The grade itself is really standardized to the industry. It's as if your used car manager would come and say, look, I think we need to budget two grand for recon on this car. That's what it means because it adjusts the price accordingly.

Can it. Can it tell if a panel's been painted? Does it. Can it see that kind of stuff, or is that just, like, way beyond it?

It is looking for that, for sure. If the panel. Yeah, it's. It's interesting. I can talk for hours about the technology, but it's designed to look as. As a human professional would look at it. So we're doing a walk around. So you're actually looking at different viewpoints and you're actually filtering out, like, things like reflections that could look like dents.

Yeah.

And then, you know, if the. If the panel was slightly painted, we will probably pick this up and flag it. But if it's like super professionally painted, obviously that's difficult to see.

Yeah. But if it's eggshell or dripped or something, you'd be able to maybe pick that up in the cr. Does it do the same for wheels and tires? I mean, could it read. Could it read a tire and be like, hey, that thing's out of date or it's expired. Like, we're picking up the text on the tire, and you need to know these things are all weather cracked or outdated.

That seems like a lot there, Jeff.

That's a lot. So a lot of this stuff is either rolled out or in the process of being rolled out because dealers are asking us exactly these questions. You're right. But I think the beauty of the solution is that it just hands all the information out in a way that your appraiser, your used car manager is used to seeing. So it's a super summary, but also allows you to investigate with really high quality images. So we will tell you. Okay, look, we think out of the four tires, two kind of need replacement. And we think it's going to be like an allowance of like 500 bucks or whatever that is incorporated into the analysis. So you really just get it. The only thing you need to do is phone up the customer and say, this is the price I'm getting you. I am telling you this is the best price you will get without coming in.

That's, I mean, of course, if a customer takes the time to, to walk through this process, they're serious buyers and serious traders. So I know that the, the penetration or the, the conversion of this customers is super high.

Hey, one more time with the acronyms by here, pay here, United. Make sure you guys are signed up because it is coming. It is just around the corner, actually.

Yep. Less than. Well, right. A month and a half away, Jeff. We're going to be out there in sunny Las Vegas just down from you, way across the country from me, and we're going to be wrapping up every afternoon, getting the dealers, taking all that knowledge you get during the day, Jeff, and we're going to try to condense it down into about an hour of back and forth, getting acronyms squared away that you don't understand and learn how to put those things into, into play in your dealership.

Yeah, it's going to be 100% worth the cost, guys. That's one thing that we can make a absolute statement on and we can stand on it. Luke will buy you a drink. If he's wrong, you will get value out of it based on the cost. So your flight, your hotels, your time out of the dealership, guaranteed at the end of the week, you will go home with more value than what you spent to be there. So it's worth it. It is 100% worth it. By the time it happens, tax time will be over. You'll be able to take your head up, you'll need a break, you'll want to go let loose. So it's a great time to come down here and be with other dealers and be in Vegas. So we'll see you there.

Hey, Jeff, just, just before we close on that, I was reading a book today and a quote in the book really got my attention. The person who stops stuttering, studying merely because they have finished school is forever hopelessly do to mediocrity.

Interesting.

And so you got to be in these places. You got to listen to us. You do this, you're never going to be mediocre. Why is it Carvana or, or Carmax, Are they using things like this? Is this, you know, is this. Are you competing with their, their technology or is. Are you selling their technology?

It's interesting. Carvana and Carmax, because of the quantities that they buy, they allow themselves to. Allow themselves to make some mistakes here and there on condition they don't care.

About a dented bumper.

I mean, that happens. I mean we, we do to it at a smaller volume.

Right and then. But dealers do care. I mean, that could make or break your profit for the month. If you go wrong on like three trades, you're done. Right. So in some, some cases. So they need these tools much more.

Yeah, everything I has has a dented bumper, so I don't really like. But Elrond, can I put something on your wish list too while we're talking about this? Because you mentioned those dealer things. Is there a way where AI, you know, this product or a product similar could. It seems like if you're talking about, you know, that 2000 Camry or that, you know, V6 engine, that series, those engines do they have like, this might be way out of the scope. So I don't know where I'm going, but they have like a sound signature. Couldn't you record audio of every engine type maybe from one or two different locations? And AI could go in and say, hey, the sound signature of this engine is off. Here's what we think it is. Like, is that where this product goes? Where, like not only are you doing outside condition reports, but now you're like analyzing the sound of the engine, the sound of the muffler and saying, hey, this engine doesn't sound right. It's not meeting the spec of what that engine should be.

Flag it. You know, Jeff, Jeff, usually you say the stupidest, stupidest things in the world, but this is actually pretty intelligent.

No, that was, that's very intelligent and it's definitely one of those things. When we talked about tires and tread depth and things like that, definitely in, in progress. But there's so much going on. I mean, with electric vehicles, the parameters for checking condition keep changing. Yeah, we just, we're late. Focused on just helping the dealers get to that trade much more quickly without.

Where are dealers going to see this? How can they start using this Product and get a hold of you guys if they want. If they say, hey, this is a big deal for me. I need something like this. Where are they going to see it? Demo it, Check you guys out.

R A V I N AI is our website. You can leave your details there. We'll get back to you within the day and give you a. A free demo and you go from there.

And.

And where?

So you mentioned earlier that some independent auctions are using. This is. I mean, have you seen an increase in. In adoption, I guess by auctions and dealers when they're. When they're doing it?

Yes. So dealers that work with us actually see an uptick of over 10 times on their trades. It's. It's crazy like that. If you email a customer, a group of customers, just asking them, make an appointment, call us or send us pictures, most of them will not do it. But if you send them a link and say, I'll, I'll pay you the best price on the market. Given this appraisal. And the appraisal needs to be professional. Once they, the customers do it, it's almost certain to be a trade. So it's incremental trades for these dealers.

Could this thing, could this thing also run on my security cameras and track all my inventory and send me an email when something gets a new dent or comes back from a test drive with a new scratch? That would be pretty cool because then I could backtrack the cameras and go fire the kid that backed into the wall.

Really find out that is possible. Yes, we have. We have also still the fixed camera systems and we're rolling those out in addition to the mobile solution.

Oh man. Yeah. Well, from an auction application, that's huge, right? Like, like you said in the beginning to put a pin in this. I know you got a couple seconds, but if the auctions implement this and just standardize that exterior condition report. It's so silly. Like, oh, this thing's a 3. 5 and you're like, no, it's got like two scratches. Who are you? Like, you think it's perfect, it's fine. Or the vice versa. So, yeah, the standardization through a non bias AI would be incredible.

Yeah. Why can't you. Yeah, why can't you call Cox and get into bit us today and implement it? Because that would be really, really nice. Anyway.

Hey, we appreciate your time. People can go to Raven AI.

Yeah, it's R A V I N AI AI.

Cool. Hey, thanks so much for your time. We appreciate it, guys.

Thank you for listening. Please leave us a review. We'll catch you in the next episode.