#321 - Retail Market Update w Ben Wheat

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.

Hey guys, that, that Jeff, you kind of left me hanging there. Thanks, buddy. Anyway, so we, we are trying to, to appeal to independence across the board. We, we slant a lot buy here, pay here. So we're having to bring on experts hopefully every month. Right, Jeff? And really talk about retail market because unfortunately that's not much I really know about. Jeff probably knows more, which is bad to say than I do about retail. Anyway, so this week we have a friend, Ben Wheat, Indie Wholesale Direct. We talked to him a couple months ago, visited him when we were in Indy in October. I think it was just a great, neat setup. We enjoyed it. Ben, thanks for being here. Catch us up on what's going on out there.

Gentlemen, great to be back, you guys. And you know, we, we're plugging away. Tax time is upon us. Everything, everything seems to be going pretty good. Pretty, uh, pretty strong influx of tax money, influx of people. Uh, cars are staying strong at the auction. Still tough to get inventory. I'm sure that you guys are probably experiencing the same thing. How are you guys doing?

You know, tax season is winding down for us and we were talking about that before we came on the air and I think it is regional and maybe the colder weather climates. I was talking to Dan Real the other day about it and you know, that first quarter of yalls, it seems like in the colder weather climates is, is a little slower in, in South Carolina. In the south, it is wide open. It's our busiest time. And when April hits, we, we kind of start to land a plane. Our pilot here, you know, talking about landing the plane. But it's been strong. It's hard to buy cars right now, which is. I hadn't had that problem in a little bit.

Yeah, you know what? I, I feel like it might even be just demographic or, or customer profile based. Right. Like Luke and I are both very much buy here, pay here. Right. So our customers are the second they have their W2 in hand. And even before they're, they're getting their tax returns done, they're filing, they're, they're waiting for that return. Whereas Ben, you know, you deal in more of a prime type customer that, you know, a lot of those guys probably owe taxes. Right. They're probably not running out to file right away. They're waiting to gather all their W2s. They got some K1s from different businesses. They've got to get together or something. So maybe that's part of it too. Some of those people are a little bit late filers. I'm a filed yet. I don't plan on filing until August or what. I don't know. What's the second deadline?

Fifteenth, I think is our deadline.

October 5th.

Yeah, yeah, whatever. Who pushed this off till 2025 or something? Pay the penalty. So, so tell me this, Ben. Like, where are you seeing active buyers right now? Where are they coming in? Is it, is it the prime guys that are paying cash? Is it subprime? My sediment is this. And I barely, barely dabble in anything expensive. I have found that it's the middle ground that is the worst. I don't want a $50,000 SUV. I either want a $10,000 SUV or $110,000 SUV because having something in the middle just seems to sit forever. The 30, 40, $50,000 trucks go nowhere. But if I had an $80,000 brand new whatever, it would fly off the shelf tomorrow. Is that what you're seeing?

Yeah, 100%. And you, you touched on this quite a bit, I would say this time of year. And I wasn't really expecting this, but now that it's happened, it doesn't really surprise me. So we, most of our credit, most of our client base right now, our customer base is people looking for cheaper cars. By cheaper, I'm going to say, well, $400 payments are below obviously, or it tends to be $15,000 or less. Okay. And that is primarily right now what we're seeing. And it's funny that you touch on this because a lot of, I think more well to do customers are maybe gearing up to write a check or maybe, you know, they're on spring break or we haven't really talked about that yet, but spring break tends to slow us down a little bit. But we're seeing some, some cash. But we're seeing our average credit score the last 30 days we just talked about this last night was below 600. So we're seeing a ton, a ton of subprime. And we're closing those people. We're closing those people at 50%. So, you know, and, and you know, we're seeing some tax money, but it hasn't, I don't really think we've reached the peak yet like we talked about before the show. And, but our, our demographic is definitely that, that lower income and, and what have you. But I will also agree with your point too, that you know, Last week I sold a car for $400,000 and then I sold a whole bunch of cars for five to $15,000. So. But I do definitely agree with your sentiment in the middle ground is very, very tough. I think it would be tough to be a luxury dealer right now that's selling 12 year old Highline vehicles. I think that a lot of people that have money are buying new and definitely, you know, I have a, a really, really good friend at the Porsche dealer here in town and last month over 75% of their business was cash.

Wow.

Tough to be a finance manager there.

It's, it's the haves and the have nots. Right. It's like you either can afford a 400 payment or under, or you're just buying it cash. Yeah, it's like there's like no, no in between. Well, and no one's doing the 800 payment anymore.

Exactly. And their rate from, from Porsche Financial, their rate is, you know, 7, 8, 9% for a prime customer. You know, I mean, who's gonna do that?

What, what kind of car do you sell for 400 grand, man.

So I sold a 2024911 Dakar, which is that.

You got one?

Yeah, yeah. So that's a, kind of a funny story how I ended up with that. But I, they're great guys. I deal with them a lot. I bought, you know, three or four GT cars the last year and another dealer actually bought that car for an end user and, but yeah, I mean, obviously limited to 2500 examples. So you know, that's not going to be too hard to sell as long as you're reasonable. But heaven forbid, if you've got a, again, if you've got a one or two year old S class or seven series BMW or, I mean, no one can save you if you had a Maserati or, or maybe a high end Tesla, you know.

Yeah, yeah, yeah. My mind's definitely upside down. But the cheap Tesla is the Hertz ones. I'm selling the crap out of the.

Model threes for 20 grand. Yeah, yeah, yeah.

Those things are getting the tax credit and flying off the shelves. But who, Ben, real quick, who's easier to deal with? The $400,000 buyer or the $14,000 buyer?

So what I tend to find is with the, so anytime that I have a vehicle that's that expensive, it's going to be something that's very exclusive. So it means that, you know, I'm, I'm going to have the only one or there's not Going to be very many.

So.

And you guys know how that goes. That means that we kind of, you know, we kind of control the deck. So those guys typically are, are pretty easy to deal with. Again, very rarely is there going to be any back end involved in that. So it's just a straight front end deal. But, you know, we've also ran into problems with those customers as well. So it, it's really hard to, it's really hard to make any kind of real assessment on that. But typically with cars that expensive, it's just a wire transfer and a, and a transport truck away.

You know, you send them some photos. You never really talked to the guy, you know.

Well, we took this car, you know that this car had 35 miles on it. So.

Yeah. So what's gonna go wrong? That's, that's really interesting to me. It seems like it is still like such a mentality thing where you could have the high end buyer that just nitpicks the crap out of it. And then I have guys where I'm like, dude, you've just got to pull the trigger, man. Like, yeah, it's a Hertz car. It's gonna have some scratches on it. You're getting a killer deal. Plus four thousand dollar tax credit. Like, it's not gonna be perfect. Like, please just be okay with this. That, that kind of stuff blows my mind.

Well, 100%.

Yeah.

I think that one thing that we can all, all three of us will agree on, you guys, is the toughest deals are also the ones you make the least money on. It's always the ones you make no money that are the hardest deals.

That's a good question. Do you make the same on a 400,000? You don't have to tell me the dollar. But is that the same markup? Like, are you making three grand on both those cars?

No.

So absolutely not. And I would say that that's probably the profit on that 911 would be the cost of four or five of my normal cars that I sell.

Yeah.

Wow.

Substantially. There's, there's no way I would take that kind of risk for three or $4,000.

Hey, y', all, real quick. We want to put this ad early in the episode because time is ticking to get your tickets to buy here, pay here. United 2024 down in Las Vegas. We are three weeks away, I think.

Two weeks away, Jeff.

Two weeks away. So, yeah, it's in the end of April. Make sure you go to buy her payherunited.com. it's not too Late. Get your tickets, get your hotel room, get your flights. It's going to be a good old time.

Yeah, we're going to have a lot of fun at Bellagio. Get signed up, get out there. We are going to wrap it up every day and just meet all of y' all that we haven't met before and share some ideas. And I know I'm gonna learn something, Jeff, and hopefully people can learn some things too.

Yep. See you there.

Hey, Ben, what we, what I've seen in clients Columbia, South Carolina right now, and I want to know you feel anything out there. Less than a month ago, one of the very few established retailers in our, in our town went out of business. I heard they, they had some issues and they probably been in business 20, 25 years. They had some issues where the local credit unions weren't buying their deals anymore. They shut the doors and then another dealer who sold very high end cars that's been in business for about three years has shut the doors. And I know Jeff has an example or two in his area. What do you think is going on in this retail market?

Well, I mean, I, I can't speak to specifically what happened in, in your town with, with those dealers. I wonder if it was a, I wonder if there was some floor plan issues there or if there was some. It's just odd that just. Did you notice any shrinking there? I mean, did they just gradually reduce their presence or was it just one day, there's no cars on the lot.

Both. And then all of a sudden it's gone.

Right?

I, I don't know. It just seems like. I think we've heard of some floor plan issues coming down. Have you seen this or heard about it?

I mean, yeah, I mean we, we hear about stuff like that all the time in our town. Typically it's smaller dealers, you know, typically it's, you know, 30, 30 car guys. I mean you don't normally see large dealers, you know, you don't normally see that happening to them. But I definitely think that overall, overall, I think that there, there are some guys struggling for sure that I do know about and I do know that I would not want to be the guy starting a car dealership right now from ground zero. I think you guys could probably agree with that.

Yeah, for sure.

Yeah. There's a lot of headwinds right now. And the one, you know, we, the example in my town of a local dealer that did 100 cars a month pretty consistently for the last few years and the word on the street is their next gear Line got pulled and, you know, I drove by there this morning. They still have cars on the lot and I'll drive by this afternoon. I'm just waiting to see the trucks roll in and haul everything off and see where that settles. But man, that is such a, it's just such an alarm to me to say, okay, is my house in order? Like, do I've got my ducks in a row? Am I making sure that I'm in contact with all of my lenders or anyone that, you know, I, I have, like, they're looking for reasons to probably shut sketchy dealer down when things get tight, right? And as a dealer, if you start getting pinched on all ends and you're not watching out, they can come up and bite you. Right. That kind of stuff, I don't know, always gives me a lot of pause to make sure that I've got my ducks in a row.

Well, it's funny you mentioned that, but, you know, like with NextGear, they have an internal score. I think we touched on this the last time I was on the show. But I actually do know, know someone that, that is, that is an executive there. And so they, they have basically an internal score. And then every time there's an audit or every time you submit financials, there's all of these metrics that they look at. Okay? Then basically it's like as long as you stay above this number, they're going to let you keep your line open. And a lot of the dealers that think they're getting away with, you know, selling cars out of trust and think they're getting away with, you know, CIT, you know, fake CITs and fake bills of sale and this and that. They're really not. But next year, first and foremost, that is a, you know, basically a company designed, you know, they, they, they just are worried about a spread on their money, right? And then they know they're going to have losses. They're not scared of losses. They know they're going to have losses. So they just internally again, have these metrics and as long as you stay above, you know, X, Y or Z, they're going to let you stay in business. But it's not that they don't know that these dealers are, you know, are playing these games and, and like we talked about last time as well, I think a lot of the larger, the larger established dealers, I think use banks. I think they shy away from next year in afc. I just think you're going to get better terms. I mean, next year doesn't even use prime, they use some kind of internal, you know, internal rate and their average right now, because I asked this question actually when I was talking to him is their average percentage, if you take fees into consideration across the board is 15% which is just, I don't see how you can pay 15%.

You know, it's hard to do especially when margins are getting compressed like they are as well. How about, let's, let's talk about rates when it comes to these lenders. You mentioned Porsche earlier at 9%. Are you seeing any big lenders getting stronger or pulling back or rates fluctuating a lot?

I mean guys, I mean we obviously know, I mean that, that, that's going to, that's going to float with Prime. I think that to, to gain share, I do think there, there we've had some specials like you know, if you open a checking account with X amount of dollars in it, they'll drop, you know, 50 basis points off your auto loan, things like that. But I think our, our best rate right now on the indirect side that I've seen is somewhere just south of 7%. 48 months.

And that's. Oh, 48 months.

Super. Yeah.

Whoa, that's, that's interesting. That would make for some big car payments on bigger, on higher price stuff, wouldn't it?

And I saw Penfed, I did see a pen Fed loan check though for four and a half percent. So some, I mean, some again but I mean we can't compete with that. I mean that's something totally separate.

How does, how, how are, I mean, how's the credit union able to do four and a half percent?

Well, I mean Penfed I would assume has something to do with, I mean that is a, that is a government backed, you know that, that is a government backed credit union. So who knows how they get their money. But I just, again, I mean maybe, maybe they're fine with losing in the short term to gain market share. I mean, who knows? Yeah. Yeah.

That's interesting. How about the big boys like you know, Cap one or Ally, Any change in how they're doing business right now?

You know, it's so crazy because, so I'm not sure if you gentlemen use Cap 1 or not, but we're, we're a diamond tier dealer. So we do, I think That's a rolling 90 day average of 45, 50 deals a month. So that means we, we do get the best rates they offer. So they've got tier one through nine. Okay. And you know, at tier one we're going to see, depending on the car. I mean there's a lot of metrics, right. And the lowest I've seen with CAP1 is about 7%. But I've also seen them approve, they've approved people that have a cap one card. I've seen them approve 550s. So they're a big institutional lender that will take a chance on somebody that, you know, that has a credit card. I mean they'll give anybody a thousand dollars, you know, they'll give anybody a thousand dollar credit card. And I've, we've put customers in there, you guys, and you would not believe it. I mean it's, it's a Hail Mary and they'll approve, they'll approve a 550 credit score with. And they won't, there'll be no steps except for proof of resident. So it's just blows my mind.

But no difference in the last little bit from, from these companies.

I can't say that there has been, I mean if you're speaking directly, you know, of the first quarter, I, I have not, I have not seen a difference.

Interesting. Jeff. Buckeyes major sponsor, they always have been. And I tell you I was just going over my CPS numbers and my, my warranty numbers the other day and my VSC numbers and I tell you it is, it's a whole nother business and can really make you a lot of money if you, if you put in the effort into your reinsurance company as, as much effort as you put in your car company, I think you can make about the same amount of money. What do you think?

I think there's a lot of dealers that probably make more in their reinsurance company than their car company.

Yeah.

But one thing I've done just now is I'm actually doing my first borrow back. So I built up enough in my earned premium that I can actually borrow this back as a loan to my company, to my operating company. So for me that's great. I've got this awesome little forced savings account that was a little nest egg that is great to have in the account right now as I'm trying to grow and expand a little more. So instead of me going to a bank to try to get a couple hundred grand, I go to myself, get the couple hundred grand, pay myself interest it. It's a win. Win.

It is. And we've been doing that for years. I can't, I can't describe more than we already have over the years how important a reinsurance company is to your dealership. Call Buckeye, get it done. Get it done today. Don't, don't wait on it.

I think that's why we talked about this in previous episodes. But it is so important to have diversity in your lending pool, right? To have options. Because you're right, it, some of it makes no rhyme or reason and it's some internal upper VIP manager that decides, yes, we want to be more aggressive or we want to change our algorithm this way or that way, or we think now's the time to gain good market share because our number one competitor is getting tight. So to have those different options and you're like, whoa, whoa, whoa, I threw a 550 against the wall and it's stuck. Like I'm going to start throwing all my five fifties this way. I had no idea. Right, like, because these guys have been shooting them down. So I just think that just lends to like, you know, we talk about that. It's so important as a retail dealer to just have diversification in your lending, your banking options. Right. You've got to develop those relationships. And Ben's obviously done a great job getting to that tier with Ally, like giving them good deals, being on top of your paperwork. Hopefully you've got a pool that's performing well. Right. And that's, I guess. And they have some sort of internal gauge or tracking mechanism.

Well, yeah. And speaking of, speaking of pools, I mean, we're all familiar with cac, I assume, right? Credit acceptance. And I'm not sure if you gentlemen use them, but I would say they are probably one of the best barometers. Okay. So one good thing about them too, in case you gentlemen don't know, is if you're ever wondering about someone's pay stubs or someone's, someone's steps, send them through to cac because if there's something wrong, they'll catch it. So surprise. Cac. But they are buying extremely aggressively. And you made me think of this when you, you know, in your earlier point. So I would say they're buying very, very aggressively right now because they anticipate rates are going to go down. Okay, so. And I have noticed they have been. And by buying aggressively, I mean reduce fees, okay? Because let's be honest, their interest rate remains the same, but their fees change. Okay? So the fact that their fees have come down and they're trying to buy as much business as they can right now, I would say that they anticipate rates to go down quite a bit and, and maybe a lot of that pertains to tax time and you know, things like that But I, I definitely have noticed a shift gentlemen in, in their buying.

I was wondering if tax, if the tax season probably was something CAC would adjust how they buy during, during that season or not.

Yeah, I mean I think the reason too behind that maybe you do tend to see larger down payments during tax time. I think you gentlemen probably see the same. Yeah. You know, but, but the kind of an odd thing with CAC is they've modified their buying program, gentlemen. I mean we did a deal last week at, at 7% with CAC so they have a gold, you know, like, like a gold tier and buy, you know, they'll buy a 25 year old car. I mean they'll buy you know, a car with 200,000 miles. They' got again a ton of different metrics they use. But. And I don't know if you guys have, if you guys use them or have closed any pools, but I've got five pools paying now and they're all paying great except for the pool. With all my Covid deals, that pool is terrible.

Do you blame that on free money or messy pool? Free money or, or payment? Because maybe they bought too much car? What do you think? Or is it both?

Yes, I blame that on cac. Not, not, not pulling back in time and letting you know you're talking about people that maybe had $5,000 one time in their entire life and you know, they hadn't shifted, you know, they hadn't shifted their metrics yet. So they bought a car and they took a 600 payment and then you know, now that $600 cars, you know, well, maybe six months ago it was, it was repossessed.

So what do you, what do you see? Yeah, let's talk about.

I've got two, I've got two pools. I just want to talk about my pool real quick. Mine's a mud puddle. Less of a pool, more of a cesspool or a septic tank. I think two pools, half of one. Neither are paying anything. In fact, I think I might owe them money somehow. I don't know if that's possible, but it's, it's not good. Not good.

Well, yeah, so, so car payments. Car payments spiked I think around six months ago. Have you seen an average car payment coming down lately? We have seen a falling car payments because of car pricing. But the 6 and 7 and 1200 dollar a month car payments, are they still here? Are they here to stay on the retail side?

Well, I mean we all, we all read the same publications. I mean the average price of a. You Know, a used car in a new car is in an all time high. And I think that as long as rates continue to stay up, it's going to be tough for that to, for that to come down too much. But I mean, we all get a kick out of the customer that comes in and says they want to have a 200 payment, right?

Or 350 even.

Just feel like 350. Yeah, but, but maybe a little downtick, you know. But what we're running into, gentlemen, is we're people tanked in their trades, you know.

Oh man. So, so I read something yesterday that said negative equity, 20% of people with car loans are upside down currently. And the severity of that upside down is outrageous. Something like six or seven thousand dollars. How do we get out of this problem?

Cross your fingers that somebody steals your car, I guess, or somebody hits you. But I don't know. You know, I just, I mean it in all honesty for the customer, I don't see, I don't really see a way out because I don't think that obviously they're, I don't think their car is going to go up in value, you know, you know, whoever, whoever is at home right now thinking about trading their car in, just know that it is never going to be worth more than tax season 2024, you know, it's never going to be worth more. So I mean, it's only going to get worse. And I don't necessarily think that because let's, let's talk about something else. There, there was a massive shortage of lease returns during COVID or leases. Nobody was leasing. Okay, here we are almost three years later and guys, there is going to be no lease returns. So you know, most of the time those new car stores, that's how they got a lot of their inventory, right? Well now they're going to have to go to the auction to get cars because there's not going to be any lease returns and the market's going to stay strong. Gentlemen, on, you know, the used car market is not going to go down very much.

We talked a lot about that during COVID of hey guys, remember this will be a hangover. There will be, there will be an effect or caught, you know, an issue with this down the road of all these inflated MSRPs and over cost and full sticker and you know, back then you were rolling negative equity on top of negative equity. And yeah, now we're back to normal. So yes, you do have to, you do have to pay up eventually. And so people are stuck in these I mean really the only thing you do is just stay in the car, right. You just keep paying. And we knew there would be less, less leases, less ability to trade in. You know, that affects the new car stores quite a bit because now they don't have that recycle that they expect every two to three years it's got to be stretched out to four to five years or something. So it definitely, the whole food chain gets tightened up.

I think new car manufacturers are really trying to press leases currently though because of that. And so we'll see if that can, you know, the next couple years loosen it up. But you're right. When you, when you go to buy 21s and 22s at the auction, good luck they're not out there. So that's going to continue to be a problem.

Well, rental car companies too traditionally have gotten you know, the lion's share of, of those cars, you know, and that, you know, there's a saying when, when, when money's cheap, leases are, leases are steep. So now that money's expensive again, leases are much more attractive.

Right, right. Do you do any used car leasing Ben? Do you have any options for that?

We do, we do. Our only option. So Ally, we don't use Ally for leasing but Ally would do it. But it just, it never makes sense. But I've got for Highline customers, this is 100,000 and above cars there's a company, great guy Ross Dressel is our rep's name. Premier. So Premier Financial, they do basically it's a Highline lease with a balloon payment. So like let's say you buy a $300,000 car, right? Well you'll, you know, instead of a $5,000 a month payment, you'll have a $2,500 a month payment for five years with a, you know, with a five year balloon. But the beauty of that gentleman is that you don't pay all the sales tax up front because let's say you buy a 300000 car. Well in Indiana I'm owe $21,000 in sales tax. Well that allows me to make my, you know, sales tax payments, you know, one month at a time. And then if I go sell the car, I'm not eating, you know, the sales tax in an entirety because let's be honest, people tend to trade those cars quite a bit. Most people that buy $300,000 cars, they might have it for, have it for a year, then they're buying another, you know, exotic car, you know, this, that and the other and, and it, it's a really, really good program.

Interesting.

Yeah. What is your sentiment, Ben? I want to know how you feel about the upcoming, you know, two months, three months, year. Like, are you, are you being more aggressive on inventory? Are you trying to like downsize your average dollar sales price? Are there certain avenues you're not getting into? How, how, how are the, you know, high end, exotic, European or even electric vehicles? Do you see those as still being an opportunity or not?

Well, I mean three weeks ago I bought, I bought 86 cars in one day. What's that?

That would blow my mind. I don't even know.

So I, I absolutely never, I never let my foot off the gas when it comes to buying.

Okay, was that, was that on a Monday with at Carmax? Because I saw you buying like crazy on a couple places I was on. Okay.

Ye. So there are, there are some secret spots that I like to frequent. I was, I was actually buying down in your neck of the woods actually. But, but, but yeah. So to answer your question, no, I do not, I do not ever let my foot off the gas when it comes to buying. I have not. I, I bought like it sounds like you gentlemen have. I bought a couple model threes I couldn't resist. Okay. And you know, fear of missing out. So I bought a couple of those, sold those when Hertz unloaded all those. I just, you know, I, I just don't have good luck with, with electric cars. I had a, an electric Jaguar I lost I think 8, 500 on. I just think they depreciate so fast. But I think that the kiss of death for me is when we don't like if I take a week or two off or slow down. It's like, you know, we don't have that fresh inventory and it just seems like we just slow down a lot.

Yeah, I, I agree. I'm same here. But you, do you think, you think the market's gonna stay strong as it has been for the, for the next year? Ben, are you anticipating that?

You know, I think when these rates come down, I, I do think we'll see a reduction by the end of the year and I think that'll, that'll boost the market a little bit because I think maybe some people that have been sitting out might jump in. I, you know, I, I think that the, the market on the under twenty thousand dollar, you know, cars, I think that's going to, I really do. Because I think that that's, you know, that's where you have any time. That's where you have the most consumers buying. You know, if you look at the US as a whole, that 20,000 and under is where the most of the people, that's the arena they're in. And I just don't see that, I don't see that coming down.

Yeah, but where do you find them.

That'Ll look hard, don't you?

Well, I mean I find him at CarMax, but yeah, for me I can.

Find the under 20, I can't find the under 10. Right. And so now I'm like accumulating this whole buy here pay here a lot of like cars in their teens, which is very hard for me to sell and keep it an affordable payment because yes, anything under 10 grand retail, it'll be gone tomorrow. Right? I can. And so there's always a scale kind of regardless of what you're, the type of customer you're attracting. But, but staying at the most affordable reliable type car. With me not wanting to get into 200000 miles plus for a buy here pay here car like that, just to me, I just can't wrap my head around having that many miles still. But it's, it's always a continual battle. But it sounds to me like you've exercised and, and you've been hunting high and low underneath rocks to find good little honey holes where you've.

Well, I'm gonna, I'm gonna share with you guys a little, you know, a little trade secret. So I think the beauty of CarMax gentlemen is you have any time. Let's say grandma passes away, God rest her soul, right? Grandma's got a buick. It's a 15 year old car. She's only got 12,000 miles on it. That's the type of stuff that I buy. You know, I buy 15, 20 year old cars. Some of them still, still do book, I mean you know there, there is a classic book that banks will use and what I mean, you know, Grand Marquis Lincoln Town cars. I mean literally old cars that have no, they, I cannot keep them in stock. I mean people come in, they fight over them, they. It's almost like a, it's almost like a joker. You know if you have a deck, if you think of your dealer at your store as a deck of cards, that's the ace or the joker. It's like, you know, there's just specialty stuff that you can buy for. You know, like I just shipped an 11,000 mile 2011 Mazda Miata to California and we had it for 72 hours. I mean it's like, you know, these cars are just you know, I mean, it's. There's just a niche, and that's kind of what we do, is we, you know, it. It's like I told you guys, nobody wants to be the one trick pony, you know, or you should be the one trick pony. So it's like, you know, that's kind of why I shop there, is you just. You're never going to see those cars at the auction.

No, no, they don't show up at all. Do you buy from the public at all, Ben? Are you. Are you actively buying from the public, or is that not something you get into?

I do, but it's just, you know. Yeah, it's just. It's almost more trouble than it's worth.

And you're not going to get 86 in one day.

Yeah, exactly. I'm not going to get 86 in one day. And I just like, you know, you'd be surprised to how many cars at CarMax, they, they. They have announcements and there really isn't, you know, if they announce major engine defect. There's not really a major engine defect or major transmission. There's not really.

I've got. I've got one. I've got one sitting out there right now that. Because I. I typically go by that rule, but I've got one sitting out there right now. We just put an engine in because of a major engine.

They covered their butt.

They got me on that one. But that's okay. That's okay. They didn't get me. It said major engine defect and it needs an engine. But that was my fault. My fault.

I've noticed that with Mannheim a lot lately. They will put engine noise or engine tick or bad engine on everything.

They just cover.

And you'll listen to the video and you'll be like, no, that's. That's the normal noise that that engine makes. And they're. Yeah, they're just trying to cover their ass with everything. So it's green light, but major engine problem. It's like, come on, man, that's not green light. I love all the disclosures, the disclaimers at the end of these sales.

Yeah.

Ben. Hey, man, we really appreciate your time. This is always super informative. I wrote down, like three or four things that I need to go talk to my guys about, which also is probably hiding my contact information from my CAC rep because there's a lot of red on this report.

He's going to come.

They're going to come collected on this at some point because. Thanks so much. Appreciate your time, man.

Thanks a lot, guys. Good chat.

Thank you.

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