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Episode #1039: Today we’re talking about Carvana's record-setting quarter and bold new goal, Ford’s strategic price hikes post-tariffs, and why Google’s stock took a beating after an Apple exec dropped a courtroom AI bomb.

Show Notes with links:

• Carvana has bounced back in a major way, setting a new quarterly record for used-vehicle sales and showcasing the company’s transformation from high-growth chaos to sustainable profitability, even amid looming tariff concerns.
  • Q1 retail sales hit 133,898 units, up 46% year over year—beating their prior record by 16,000 vehicles.
  • Net income reached $373M; revenue surged 38% to $4.2B.
  • Tariffs caused a temporary demand bump, but Carvana is now focused on adapting inventory to price-sensitive consumer behavior.
  • Carvana aims to sell 3 million vehicles annually within 5–10 years, targeting a 13.5% adjusted EBITDA margin by fully utilizing its existing infrastructure like ADESA megasites and inspection centers.
  • CEO Ernie Garcia emphasized flexibility: “We’ve got significant margin to work with… and significant cash balances.”

• As the auto industry adjusts to newly announced tariffs, Ford is selectively increasing prices on several 2025 models while shielding current dealer inventory.
  • Starting May 2, 2025 Mavericks, Bronco Sports, and Mach-Es (all produced in Mexico) will see MSRP increases of $600–$2,000, depending on trim and features.
  • Existing stock and vehicles already in transit will keep their original sticker prices.
  • Earlier this week, Ford withdrew its 2025 outlook, citing $1.5B in expected tariff-related earnings impact.
  • Ford is one of the first major automakers to publicly respond to the impact of the tariffs with pricing strategy.
  • “We can’t forecast what we can’t see,” said one executive privately

• In a courtroom twist, an Apple executive may have confirmed Google’s worst fear—that AI is starting to eat into its search dominance.
  • Eddy Cue, Apple’s services chief, testified that Safari searches dipped in April for the first time ever, likely due to users turning to AI tools like ChatGPT and Perplexity.
  • Cue expects Apple will eventually add AI search engines as user-selectable options in Safari.
  • The revelation came during Google’s antitrust trial, where Apple disclosed it receives over $20B annually to keep Google the default.
  • Google stock fell more than 7% following Cue’s testimony, wiping out tens of billions in market cap. They responded by saying “we continue to see overall query growth,” especially from Apple platforms.

Join Paul J Daly and Kyle Mountsier every morning for the Automotive State of the Union podcast as they connect the dots across car dealerships, retail trends, emerging tech like AI, and cultural shifts—bringing clarity, speed, and people-first insight to automotive leaders navigating a rapidly changing industry.

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