Todd Morning, President Trump, John Elway discussed on


It's difficult, for most people to estimate unless you're in the, business how much car prices change but I absolutely positively guarantee you there is nothing like a a typical year with a ten percent increase in the price of cars let's keep this. In mind first of all, not only our our cars fairly, expensive I mean I know cars are much much cheaper than houses but houses are probably the most expensive thing that. Most people buy cars are probably the second most expensive thing did most people by having the second most expensive thing in your life go up by ten percent even five percent is a, lot but go up by ten percent in in a year when your wages are probably going. Up, on. Average two percent In a year That's enormous That's. Absolutely enormous now I have a few more things to say. About this first, of all This gets more to a level of fundamental principle Why is it okay seriously just back. Away for a minute from any kind of partisanship Back away for? A. Minute. From any kind of conversation about Trump or anything like that And ask yourself this question why is it? Okay for the federal government to tell you that you have, to pay more for something why is it okay for the federal government to. Tell you you? Have to pay ten percent more for something and I'm telling you this why is it why would it be okay for the federal government to tell you that you had to pay ten percent? More for a for a, one dollars cheeseburger at McDonalds and make it a dollar ten why would that be okay even if it was only a dime Now from, the look what the cat dragged in files joining us online one our friend. My friend Todd? Mall the managing partner of the Elway dealerships you hear me talk about the Elway stores all the time on the show and I know Todd is an early riser and often driving to work? At this time so I, had a feeling he might be listening So good morning Todd Morning, rod I'm good so let me just restate the. Listener's question the listener steams to be laboring under the idea that fairly large increases. In car prices are a common occurrence on an annual basis and so that if a car price, goes up let's say close to ten percent in one year because of this government policy that that's really just normal normal get soaked up in the usual activity of the. Car, business anyway, I'm skeptical but I'm not. An expert so I'm asking you Ross we we don't see a ten percent increase annually typically we're in the two to four percent and a lot. Of, depends on, if it's a brand new. Model so I say From the ground. Up like that A joke a while back but chief Frank Down wind, up about four percent, from the previous bottle which you know again when you've got, a call model Just a little bit more for that technology and, all the retooling and, everything that they had to do Let's Okay so let's pick a moderately priced mid range sedan that you. Sell how about how about a Chevy? Impala what's average price for an? Average An average Chevy Impala typical consumer kind of buys. In, that car well still be empowered in the different levels you say. On a thirty five thousand dollar Paolo? AB at nine hundred dollar increase Backs. Year-over-year they really do try to keep that out we you know the more money that the car for less than two, us could afford that particular car and it's all about volume out. There. And of course they keep put a sentence on 'cause on a. Regular, basis to help defray those increases employ. Sells bottles but we never see a ten percent increase year over gear up okay This would, be a bad thing for our summers and it's certainly not to the dealers as well okay so let me let me get one last, question in with you in a relates a you just started going down the road. I wanted to go down how how price elastic is this market if if you saw a ten percent increase in, in? Most of your vehicles in the in the. Cost, it's cost, to you that you therefore after pass along to the consumers because you're actually not in. A in a particularly high margin business. It's not like you can have just absorb most of a ten percent cost increase how much do you think that crushes, consumer demand or willingness to buy a car at that new price. Point We would, probably see about a ten percent reduction in the desire for vehicles some people were. Moved down of the more expensive just to stay aligned with their budget but yeah we could also percents decrease Vehicle sales. Due to these tests and what's going on with the Texaco Canada NAFTA agreements okay so. Part of, President Trump's argument for doing this even though I'm skeptical of it let's just take him at his word that part of, his goal is to increase automotive jobs in the? United States of America if what if what you just described were to happen. A ten percent drop in sales at your at your stores because of this what would. That mean, for employment at your stores Well I think you, would see a similar job that employment as well We we have we have a great staff and T-ball your great people always but the volume and if the business, isn't there with change. The dynamics of. The dealership don't question about it All, right Todd hey. I appreciate your calling in and giving us some great information as always, drive safe to work Got it all right thanks all right Todd ball the. Managing partner of the John Elway stores I tell you what I get more. Listener emails about these kinds of questions so we'll we'll come back and and I want to talk about this a little more than I am going to get to. This Email that that starts with Ross I know. You hate Trump which is. Not true. I'll explain, right. 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