TrueCar - DealerTrack (ALG) Relationship: The words of a DealerTrack Employee

I received this email about eight hours ago from an employee of DealerTrack. They asked me that I kept it discreet so I will not be mentioning who it was that sent this to me. It is amazing that DealerTrack's own employees have certain opinions about DealerTrack selling ALG to TrueCar. Does it mean that DealerTrack's own employees are against this deal too? I know that I myself could not work for a company that would allow something like this (no matter how much money I was getting paid). Anyway, here is the email with more inside information by someone whose name cannot be disclosed. Friends, enjoy this as much as I did.

> So the press release reads "DealerTrack sells ALG to TrueCar." Why would DT part ways with their most unique data brand, in an age where data rules all, you ask? Well, actually they didn't. In the "selling" of ALG, DT gets: an equity stake in TrueCar, scores a seat on their board, receives a perpetual/royalty free ALG license, secures a multi year agreement to retain operating duties, and banks a very high stack of millions of dollars. What did they give up other than some future subscription revenue, of which they are going to share in anyway?
>
> This isn't a sell your dealership to AutoNation/take the money and run type of a transaction. This is Pops handing off to Junior. Son here's how we do it. This is nothing more than "let's just go ahead and transfer the title and put this thing in your name, wink." DealerTrack had to have anticiapted the outcry of moving dealer data, and this was their way of staying off the battlefield.
>
> So why would TrueCar agree to such a one sided expensive deal? Imagine all the financial and lender information that DT has access to, or the amount of data contained in the DT DMS (Arkona), imagine the number of credit applications submitted through their portal each day, the scanned deal jackets, the AAX inventory metrics, TriVin's electronic titles, etc... The amount of data is maddening, it's deafening. But with every one of these keystrokes from these modules and business units comes a corresponding digital imprint, an imprint that is filed and sorted, and sent to the DT data vault for future use.
>
> Welcome to the future.

> Many of us have seen A&E's Storage Wars where entrepreneurs will bid for access and ownership to the contents of storage lockers that are in default. Invariably there is a guy in the back of the auction crowd with a funny hat that is always nodding his head and mumbling, "uh hum". Let's call him Scott. And Scott will do whatever it takes, at any cost, to get the keys. He just wants to go in and take a peek around. Here's a check.
>
> And whether you think it's your data, or legally it's theirs, or you like the TrueCar business model or you don't, that's up for you to decide. One thing is for sure, DealerTrack just made a truckload of money.

> Zig, meet Zag.

4 members like this

Comment

You need to be a member of DealerELITE.net to add comments!

Join DealerELITE.net

Comment by Keith Shetterly on December 17, 2011 at 8:32pm: Grant Cardone also said TrueCar was our friend. Not only did his statements help them, by your definition, it also helped him. I explained to him that notoriety marketing has its limits. Benedict Arnold was notorious, too.

Anyway, in marketing, there is a war and there is a battle. Wars are not won by winning all battles; nor are they won without casualties.

My first casualty will not be my personal integrity.

Honda is a negative, generated by the very notoriety of TrueCar helped along here in these blogs; a battle with with the casualty of Honda's support lost and TrueCar in the press. Oh well.

Anyway, my suggestion is that you use your skills and apply at www.truecar.com/hiring.html. That seems to fit your personal take on this much better.

Thanks.

Comment by Arnold Tijerina on December 17, 2011 at 7:44pm: One of the penalties for non-compliance back in 2003 for advertising below-invoice pricing was withholding the advertising dollars given to the dealer. Isn't that what you're referring to, Keith, when you say "co-op"?

If dealers started doing it through Cars.com, Honda would have the same stance, and they'd enforce it the same way, and it'd be specific to Cars.com, and timely. It's only specific to TrueCar because that's where it's happening right now. Honda can't stop TrueCar from publishing pricing. All they can do is punish dealers who participate in TrueCar's program.

The data available to consumers isn't going to go anyway. In fact, I think it's going to grow. All this publicity (like this article and all the other articles) only have consumers rooting FOR TrueCar. This is great PR for TrueCar. Consumers that read these articles are CHEERING for TrueCar.

As Grant Cardone says, if you don't have haters, you're not succeeding.

Comment by Keith Shetterly on December 17, 2011 at 4:19pm: The enforcement via co-op denial is timely, new, and specific w/regards to TrueCar.

Comment by Arnold Tijerina on December 17, 2011 at 4:13pm: Reality is that Honda has had policies regarding their dealers advertising below-invoice pricing for many years (at least since 2003). This isn't Honda "going to war" against TrueCar. This is Honda enforcing policies that have existed for many years. It can be spun any way anyone wants to spin it but this is nothing new in regards to Honda's policies and the ramifications of dealers not following them.

Comment by James A. Ziegler on December 16, 2011 at 3:17pm: Okay Honda has taken a courageous stand and banned TrueCar pricing with it's dealers. I know for a fact VW is strongly considering doing the same. I hope VW realizes that they've just began to get some incredible momentum in the market AND now is NOT the time to allow an invader like truecar to devalue the brand in the public's eyes. No matter what you sell, TrueCar cheapens your brand.

Group 1 made sure their dealers cancelled after looking at the exposure of having these people rooting around in their DMS, especially with AutoNation's CEO on the board of Truecar...

Group 1 was smart enough to see the writing on the wall and run as from away from these people as possible. When is Asbury, Penske, Sonic and others going to awaken and realize they people appear to be a huge threat? Even large private groups like Rick Hendrick should be looking at the evident danger we're all perceiving here.

Where are Ford, General Motors and especially...where is Toyota in this escalating skirmish? I am embarrassed that mark Reuss, president of general motors would actually go to TrueCar Headquarters and play with Painter showing him a 750HP Camaro.

I did not mention Nissan because their dealers are using Truecar to sell way below invoice so they can collect stair step money. You guys are smiling now BUT if Nissan takes away the program, you're screwed royally because of the benchmarks you set with TrueCar making your brand image "Ultra Cheap Nissan"

Does Mark Reuss NOT understand that his dealers are being raided by these people cheapening the product down to unprofitable and below? I find it hard to believe that Reuss would publicly suck up to these people if he truly understood.

There are a few investigations of TrueCar popping up here and there AND we're still urging dealers to put more emphasis with your dealer associations to get off of the sidelines and represent us... I know a couple of associations are doing their best while others limped off of the battlefield without firing a shot... weak.

I am especially disturbed about Toyota staying quiet while Honda takes a stand. It's like sending a message that Toyota has less value.

This thing will gather increasing momentum and I predict TrueCar will find some high-profile weak suck who will sellout their integrity for the publicity or hard cash and take a stand publicly backing them and betraying dealers.

Of course, this is all a lot of conjecture, speculation, supposition and opinion...I might be wrong. :)

Comment by Stan Sher on December 15, 2011 at 1:49pm: Please read "Scott Painter (CEO of TrueCar) speaks to Stan Sher (President of D...

Comment by James A. Ziegler on December 15, 2011 at 1:33pm: Dealer just told me he was interviewed by investigator from the Louisiana Motor Vehicle Commission that is investigating ZAG/Truecar with an upcoming hearing. They took a hard look at his records.

Comment by James A. Ziegler on December 15, 2011 at 11:39am: Painter is suddenly everywhere defending TrueCar BUT like your pappy always said... "Cockroaches always run when you shine a light on them"

Comment by Stan Sher on December 15, 2011 at 11:37am: I am listening to the call with Jerry T and Scott Painter right now and it is exactly how the call went with me. We had similar questions and the answers were exactly the same.

Comment by Stan Sher on December 15, 2011 at 11:37am: Thanks. They are going after you too. I want to hear about your call.