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Thursday is upon us and we’re breaking down Lithia Motors' strategic layoffs aimed at saving $150 million annually, Virginia's decision to reverse its adoption of California’s strict EV standards, as well as IKEA hiring Roblox workers (you read that right).

Show Notes with links:

• Lithia Motors is targeting $150 million in annual savings through strategic layoffs and other employee cost reductions, primarily focusing on U.S. positions.
  • Senior Director of Finance Jardon Jaramillo described the cuts as "very targeted" rather than a broad reduction as he said "We're not announcing a mass layoff.” "These are changes at the store level," and gave examples including taking action on "underperforming general managers."
  • The layoffs are part of a plan to eliminate $250 million in annual selling, general, and administrative expenses.
  • Additional savings will come from reducing inventory and third-party service provider costs.
  • Changes will include leadership adjustments at the store level, targeting underperforming general managers.
  • They will also be laying off 6 of their 13 communications employees
  • Efforts are also being made to improve storewide adoption of Lithia's online vehicle shopping platform, Driveway.
  • The 60-day plan, launched in May, aims to impact Lithia’s financial results significantly in Q3.
• Virginia’s Governor Glenn Youngkin announced the state’s withdrawal from California's stringent EV standards, citing a lack of legal obligation and insufficient consumer demand.
  • Virginia initially adopted California’s EV standards in 2021 under former Gov. Ralph Northam.
  • Governor Youngkin argues that the government shouldn’t dictate vehicle choices, advocating for less strict federal emissions rules.
  • Only 9% of vehicles sold in Virginia in 2023 were electric, reflecting weak consumer demand.
  • The Alliance for Automotive Innovation supports the move, stating that California’s EV standards may not suit other states due to varying consumer demand.
  • Environmental groups and Virginia Democrats criticized the move as undemocratic and potentially illegal.
  • The Biden administration has granted automakers more time to comply with federal emissions rules, aiming for over half of new-vehicle sales to be electric by the early 2030s.
  • "Virginians deserve the freedom to choose which vehicles best fit the needs of their families and businesses," said Youngkin.
    
    
• IKEA is launching a virtual store in Roblox and will pay players £13.15 or €14.80 per hour to work there. The store, dubbed “The Co-Worker,” will offer immersive career experiences.
• Players can create virtual homes using IKEA furniture and items.
• A limited number of players can apply for paid virtual career roles, with applications open from June 3 to June 16, 2024.
• Applicants must be 18 or ol

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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