Executive Profile with Jim Fitzpatrick, Powered by CBT News

She Refused to Sell and Built an Empire Instead: Carina Diehl's Dealership Journey

• CBT News • Season 1 • Episode 5

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The remarkable journey of Carina Diehl from grief-stricken widow to powerful automotive industry leader exemplifies resilience in its purest form. After tragically losing her husband Matt at just 46 years old, Carina faced a pivotal decision: sell their single dealership or step into an unfamiliar industry to preserve their shared dream. Despite being advised to sell and having minimal experience, she chose the harder path.

Walking into the dealership with determination, Carina learned the business from scratch, often hiding her knowledge gaps behind closed office doors while seeking guidance from industry contacts. When one manufacturer refused to approve her as dealer principal, she boldly threatened to contact national news outlets about their treatment of "a widow with two children" – they approved her the next day. This moment perfectly captures Karina's defining characteristic: when someone tells her she can't do something, it becomes her mission to prove them wrong.

Fast forward to today, and Diehl Automotive Group has expanded to 22 dealerships across eight campuses with 13 franchises and eight collision centers. This growth occurred organically, starting with a second dealership purchase when her daughter left for college – a decision her accountant advised against. Beyond business expansion, what makes Carina's leadership distinctive is her commitment to work-life balance for employees. By encouraging flexible scheduling for family commitments and ensuring team members take regular time off, she's created a culture that cultivates loyalty and productivity.

Looking ahead, Carina continues building a legacy for her family, with her son actively involved in operations and her son-in-law recently joining the business. Her story demonstrates that even in traditionally male-dominated industries, extraordinary determination can overcome seemingly insurmountable obstacles. Subscribe now to hear more inspiring leadership journeys that challenge conventional wisdom and reveal the human stories behind business success.

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Jim Fitzpatrick:

This is the Executive Profile, exclusively on CBT News. Recently, I had the opportunity to travel to Pittsburgh, Pennsylvania, and speak with the owner and CEO of Diehl Automotive Group, Karina Diehl. Karina is a remarkable dealer principal who has triumphed over some of life's toughest adversities to get where she is today. After tragically losing her husband, Matt, in 2007, Karina had a choice to make, either sell her family's dealership or dive head first into the business without much experience in the automotive industry. Karina decided that preserving the family's legacy was of the utmost importance, and she went on to learn every aspect of the dealership operation, and she did it well.

Jim Fitzpatrick:

Fast forward to 2024 and Diehl Automotive Group has grown to an astounding 22 dealerships and eight collision centers, where her son and daughter are integral parts of the group's operation. Karina Diehl just won't take no for an answer. We sat down with her in one of her newest collision centers. Check it out. Karina Deal, thank you so much for allowing us to come by and spend some time with you. Your story is so inspiring so we wanted to come out here, meet you person to person and get the whole story.

Karina Diehl:

Oh my gosh, thank you for having me. Absolutely this is super cool.

Jim Fitzpatrick:

Sure, so for some of the people out there in the automotive industry although there's probably not that many, because you've made a big splash out there with your very inspiring story tell our audience uh, take us back and tell us how you got into the auto industry and how you ended up running 22 different franchises.

Karina Diehl:

Wow, I got him by default, quite frankly. Um, my husband was the car dealer and he died. He broke his ankle, got a plate and six screws. Four weeks later he was brain dead. He broke his ankle, got a plate and six screws. Four weeks later he was brain dead, paralyzed, and we took him off of life support.

Karina Diehl:

So then it unbelievable 46 years old. So then it became a decision of what do I do? We had two children. When he died, Rachel was 12, and Matt was 18. And of course, the sharks came swimming. You know you want to sell the store, but how many stores did you have at the time?

Jim Fitzpatrick:

We had one.

Karina Diehl:

Okay, we had 70 employees, one location. But you know, I wanted to keep it for his legacy and for what we had dreamed about. So it was about. Four weeks later I walked into the dealership and decided I was going to be the car dealer.

Jim Fitzpatrick:

What a story. Right, and up until that point had you played a role in the dealership operation?

Karina Diehl:

I did some minor things. I was the stay-at-home parent. I was raising the kids. I was involved in their lives and Matt was the one doing that, so it was kind of a traditional relationship.

Jim Fitzpatrick:

Right, sure, sure, sure. That's as it is in so many cases with dealers today. Right, and so you make the decision at that point in time. No, I'm gonna, I'm gonna be the dealer principal and we're gonna run this thing.

Karina Diehl:

Crazy.

Karina Diehl:

Yeah so I went in and I would keep the door closed because I didn't know what I was doing. Quite frankly, you know, sure, and what the staff would do was daily. They would bring in everything Matt was looking at, sure. So back then we had all the paper right, like they'd put a dock on my desk that was this big. But I'd call people there were so many wonderful people helping me behind the scenes and I'd call them and say, hey, this is called dock. What do I do with that, you know, and they'd walk me through it. But I would never let anyone else know. I didn't know. It was really important, you know. And then one day the controller knocks on the door and comes in and Lisa said you know, the ladies don't know what to do when the doors close. When Matt had the door closed, you weren't allowed to disturb them. I was like open the door.

Jim Fitzpatrick:

Yeah, yeah.

Karina Diehl:

And that's when it really began and probably really hit me because I was learning so much.

Jim Fitzpatrick:

I'm still learning today. Yeah, of course you know it's such a crazy business. There's no question about it. And from that point, were the OEMs okay with everything? Oh, no, not even a little bit.

Karina Diehl:

No, I was a wife coming in and one of the manufacturers really didn't want to approve me. So, I spent about eight, eight months. I would have to give him a daily list of tasks that I did, and I did it with my attorney. Crazy right, wow.

Jim Fitzpatrick:

But I wasn't qualified yeah, yeah even though we had a great staff yes, so finally you're selling cars, you're making money.

Karina Diehl:

We're still doing everything we were doing you know. And finally, the dealer placement guy called me, who I loved, and he said listen, in the history of this company, carina, they've never had this situation and they're not going to approve you. Oh my gosh. Now, ok, I have two kids to feed and I have 70 team members that we're feeding. And that's when I said, ok, if this is what you're going to do, I'm on the phone, I'm going to call. I'm on the phone. I'm going to call every national news agency.

Karina Diehl:

And I'm going to tell them how you're going to take a widow with two children's livelihood away.

Jim Fitzpatrick:

They approved me the next day, interestingly, how that happens, right.

Karina Diehl:

But maybe they needed to know I would or could Right you know when. I look back at it, I think, boy I was palsy. Yeah, sure, Right. You know, when I look back at it, I think, boy I was palsy. Yeah, sure, you know but I had kids to fight for and a family I was feeding Sure.

Jim Fitzpatrick:

Do you think it's the same way today? Do you think their reaction would be the same today? I, you know, I don't know. Yeah, that's interesting, I don't know how they look at qualifications.

Karina Diehl:

I do know, though, that we were a stable company.

Jim Fitzpatrick:

That's the catcher right there. I can see if you were losing money and they were concerned and they said, hey, we've got to get a real operator in there that knows the industry maybe better than you at the time.

Karina Diehl:

Absolutely, but for a company that is doing.

Jim Fitzpatrick:

Well, let's just back off and let them do well.

Karina Diehl:

Yeah, yeah, I mean. The good news is we're partners now and I've acquired a few more of their stores. That's great. You know we get along really well.

Jim Fitzpatrick:

That's fantastic. So you've got the store, you're running it and kind of walk me through, because now you're at 22 franchises.

Karina Diehl:

We're at 22 dealerships.

Jim Fitzpatrick:

Okay 22 dealerships, Eight campuses Okay two dealers eight campuses, okay, 13 franchises. Wow, eight collision centers. Oh my gosh, that is fantastic.

Karina Diehl:

Thank you, oh my gosh, your husband's got to be looking down going that, or she's totally nuts, you know, I'm not sure what he's thinking sure, what was the first store that you bought after that original store that you took over? So fast forward. So Rachel was still my daughter, our daughter was still at home. Okay, at that time, and you know, her world changed dramatically of course so we became best buds, we were inseparable, sure?

Karina Diehl:

so now she's getting ready to go to college. Yeah, which was going to be a total change in my life, yeah, and hers sure, ultimately, instead of buying a handbag, I went and bought another store. So sure, that's what you do.

Jim Fitzpatrick:

Yeah, that's what you do Cut it out of the ball, but now I'm gonna go.

Karina Diehl:

Well, I knew I needed to fill a lot of that void, because we had been together alone for so long that my best friend was leaving me. And I did it. My accountant said don't do it. Everybody told me not to do it. But the minute.

Jim Fitzpatrick:

you tell me that that seems to be the Carina brand, right.

Karina Diehl:

I mean that you built.

Jim Fitzpatrick:

It's like don't tell her, don't do it.

Karina Diehl:

And I totally agree with you. I think that's how I roll and I knew I needed something and I spent 12 hours a day.

Jim Fitzpatrick:

And that store successful and I'm so proud of it. I would imagine, too, that other OEMs maybe came knocking and said we've got this incredible female operator and dealer. We want her on our team as well. Did you find some of that?

Karina Diehl:

No, no, okay, can we get them to come knocking?

Jim Fitzpatrick:

right, no, but do you know what I mean? I mean, it's a great story and you're a great operator. You would think that they would say look, we need somebody like that as a dealer. I would hope someday they will, they will, but you've got to fight for everyone.

Karina Diehl:

And I'm still fighting yeah, not as hard, as I used to, but yes, that's something.

Jim Fitzpatrick:

So you've got all of these franchises. The expansion plans are continuing.

Karina Diehl:

They are. I mean first of all, let me be very clear. I don't do this alone. This is a group effort. We have a tremendous team. My son's very involved in the business. I have key reports. Yes, expansion is always in the picture. I'm getting older, but my son's really good at spending my money.

Jim Fitzpatrick:

I thought he was not watching today, or maybe you wanted to be watching today, right? Yeah, yeah, yeah.

Karina Diehl:

No, we joke about it.

Jim Fitzpatrick:

Sure.

Karina Diehl:

Down the road I see us buying more stores.

Jim Fitzpatrick:

That's great, that's fantastic.

Karina Diehl:

Yeah, wow, I do.

Jim Fitzpatrick:

That's fantastic. Do you get and I've asked this to a number of dealers here recently but because the M&A activity is so strong out there, do you get calls periodically of people that say, hey, karina, do you want to sell?

Karina Diehl:

Oh, all the time.

Jim Fitzpatrick:

Oh, you do All the time. I get emails, I get calls and we're not for sale right now. Yeah, not doing it?

Karina Diehl:

No, I'm not there. I mean, I'm building a legacy for my family, for my grandchildren. Sure, sure I don't listen. You never know, right, you don't know what the years bring on, Sure, sure.

Jim Fitzpatrick:

I was in where we met earlier today at the Solanus store and you had these incredible motivational sayings all over the walls in that dealership. Tell me about that. What was the motivation behind putting those up there?

Karina Diehl:

they're very inspiring they are you don't typically see those in car dealerships you don't, I would tell you they were some of the sayings that got me through life that still do. You know. I'll walk in there and look around and and it touches me personally- yeah, yeah and I have people that come in and take pictures and relate, which is, again, you don't see them in dealerships. But I think when you look around, it's very motivational.

Jim Fitzpatrick:

There's no question about it, I found myself. I couldn't stop reading until the last one.

Karina Diehl:

Exactly, one was better than the next.

Jim Fitzpatrick:

That was a very, very nice idea.

Karina Diehl:

Thank you, there's no question.

Jim Fitzpatrick:

So you're probably uniquely qualified to answer this question, I would say and that is how do we get more females into this great industry? I mean, you are living proof that females can run dealerships very successfully, in many cases better than their male counterparts.

Karina Diehl:

I totally agree with that. I totally agree. I think we, as women, have to get out there many cases better than their male counterparts. I totally agree with that. I totally agree. I think we as women have to get out there. We have to hit these young women when they're in high school. We have to hit them at the trade schools. We have to offer opportunities. I think that women still believe, even younger women, it's all about men. You know, you think of car dealerships, you think about men.

Jim Fitzpatrick:

I know it's male-dominated.

Karina Diehl:

Totally about men. Yeah, you know, you think of car dealerships, you think about man. I know it's male dominated, totally yeah, but but there are so many phenomenal opportunities for women, whether it's as a technician office, I mean sales management. The sky's the limit, if you choose it. I, internet departments, rental department. There's so many opportunities. But we as women, right, need to go out and grab these young women, sure, and and let them bring intern with us. Let us let them see the career opportunities that were offered.

Jim Fitzpatrick:

or would we speak to women that are in the industry? They will say you know, I couldn't. I I got out of the industry, you know, because the hours are so long, right, and I can't make it to the Little League game or to the recital. Or you know it's, the hours are so long, right, and I can't make it to the Little League game or to the recital, or you know, it's too demanding and of course, the pay it fluctuates so much if they're in sales or maybe they're writing service or what have you. Do you think that we need a fundamental change as to how we manage that process?

Karina Diehl:

We Deal. Automotive Group does not but.

Karina Diehl:

I think as a whole, the world has changed. I was on the phone today with a controller. He this morning got to watch his daughter dance. Oh, that's great. But the reality is I encourage people to have a life. Look, if you need to leave to go to your kids, please leave and go watch your kid play ball. Go enjoy them growing up. Because if you don't give people the opportunity to have a quality of life in their work environment, to enjoy their family, it's hard to retain them. So I'm a firm believer and I encourage that internally. I think pay is great, but I think women and I've had single parent women work for me and I'm the first to say, yeah, you can't get in until 9.30 because you have to put your child on the bus. It's okay, I lived that life. I understand being a single parent, but I do believe that employers as a whole need to allow people to have a quality of life.

Jim Fitzpatrick:

I encourage that that's great. That's fantastic. And for dealers that are listening, listen up, because that needs to be the case. Out there we still hear of the old you've got to be here from bell to bell and then some. And if you get promoted, you've got to be here at the dealership even more, and that doesn't always work well. For some of the females that try to succeed, I don't think it works well for anyone no you're right, it's a good point. I think my people Kind of old school.

Karina Diehl:

It's very old school. My people work five days a week. There's got to be a quality of life Right. I have them take long weekends, obviously not the end of the month. Right, I make sure that they take a long weekend to rejuvenate. You can't function well at work if you have no home life. Right, right.

Jim Fitzpatrick:

That's right. You can't. They'll begin to resent you right as an employer. Your wife or your husband will resent you your kids won't know you growing up.

Karina Diehl:

I think it's really important. I know when I took over I lost a great portion of Rachel's high school years, you know, by virtue of just having to dig in and build, and I wouldn't want anyone to miss those games that I missed.

Jim Fitzpatrick:

Yeah, for sure. Speaking of attracting and retaining employees, does Deal have any kind of a program for that to go out and get good candidates to come in? That's a tough game today, isn't it?

Karina Diehl:

It's a tough game. I think that where we sit, being a family business and you certainly know that a lot of these big conglomerates are coming in buying stores and they're corporate now we're still a family and I preach family, family values time, quality of time. So I think that's a big opportunity. I think pay matters and I think to the millennial generation, they want time. They don't really care about pay. You know they don't want to work 12 hours, but I don't have anyone in my organization. I have a few people, but they choose to do that.

Jim Fitzpatrick:

I was going to say, yeah Right, you always get them. But yeah, no question about it. So the stores are all doing great. You're looking at opportunities as they come along. You're not selling, I mean you're in for the long haul.

Karina Diehl:

I'm in for the long haul.

Jim Fitzpatrick:

I'm always looking at stores. If they pencil, sure, and if and when you think about a succession plan do the. Do the kids want to get into the?

Karina Diehl:

business and take over. Or is it too soon to know?

Jim Fitzpatrick:

well, oh, my son definitely and he's been a driving force.

Karina Diehl:

Yeah, he's spending the money. He's a driving force, but he's super smart and he is always looking out for us.

Jim Fitzpatrick:

Yeah so do you more like his dad or his mom?

Karina Diehl:

He's definitely like his dad.

Jim Fitzpatrick:

Okay.

Karina Diehl:

He's quiet, he's somewhat introverted, super smart yeah, but he's certainly looking at the long-term play. Okay For our family, which includes his sister he has four children, his wife and from that standpoint I see the deal name being around for a long time, that's pretty cool. Unless I decide to sell before I die.

Jim Fitzpatrick:

Right. That's always the alternative, that's right. But if this is good and the kids are running the deal and you can, leave that as a legacy one day, then that's pretty cool.

Karina Diehl:

It is, it is.

Jim Fitzpatrick:

Yeah, many dealers are in your same situation where they feel they're going to pass it on to their children and then maybe their grandchildren, right?

Karina Diehl:

So the first generation builds it, the second generation keeps it going and the third messes it up right, isn't it usually at about the third gen where they're a little silver spoon Sure?

Jim Fitzpatrick:

And they don't have the passion maybe that the founders did to make it go. They look at it as well. This is kind of a big paycheck, but otherwise it wasn't my idea to get into the car business per se, right.

Karina Diehl:

It's true, and that's how I bought a group. I mean the third generation just.

Jim Fitzpatrick:

Yeah, they didn't want it, they didn't care, right, right.

Karina Diehl:

Which was a buy for me.

Jim Fitzpatrick:

Sure, sure, it's a good opportunity for you, yeah, so let's change gears a little bit and talk about some things here that dealers are faced with today. As you know, the EV situation has got the industry kind of on edge. And to say are we doing EVs? Are we not doing it? What the consumers are still saying, we don't think we want them right now, at least not at this pace that the OEMs are wanting to get them out there and states are changing laws to say we're going to be all EV by 2035. And what is your take on the EV situation Makes my head spin, you know we aren't in California, we aren't in Texas and we aren't in Florida.

Karina Diehl:

I have EVs sitting on my lots. I personally am not comfortable with the range yet as a vehicle that I would drive daily because of the amount of mileage I put on my car. I think that that's probably a general consensus, right? We don't trust them. We live in the Midwest climate, et cetera. The infrastructure is not there. I would like to see the manufacturers stay with hybrids. I get what the different laws are and the different states are requiring. I don't want to be with a manufacturer that's going all EV in the next three or four years.

Karina Diehl:

It scares me Again my counterparts in California. They sell a lot of them, right, there's more infrastructure there. I can't tell you that if you drive the PA Turnpike, which will take you about six hours, there might be an EV station. I don't even know.

Jim Fitzpatrick:

Yeah, yeah, I wouldn't risk. It Right, right, and you're not there yet, yourself.

Karina Diehl:

I'm not even there.

Jim Fitzpatrick:

Yeah Right, I'm not a believer in it, sure, sure. So you think the industry needs to pump the brakes on that?

Karina Diehl:

A little bit. Yeah, yeah, yeah, I get what the government's demanding, sure, but when I look at it from a retail standpoint, which is where you know we always tip for the OEM and us and then the government has their roles.

Jim Fitzpatrick:

Are the consumers coming into your stores, at least asking about them or test driving them?

Karina Diehl:

You know we have a lot of EVs sitting around. Okay, we do. Hybrids are great. We're moving hybrids, yeah.

Jim Fitzpatrick:

What do you do with those EVs as you look down the road and say, oh, these things are, you know, 120 days, 180 days, pay a lot of floor plan yeah.

Karina Diehl:

Yeah, I don need it. I mean, pay a lot of floor plan, yeah, yeah, I don't know what we do with them and and I'm struggling with that when I look at our aged inventory. I, you know, we discounted as much as we can. We know on a wholesale level that they're horrible. Yeah, I mean, they drop in value substantially. If you see what's happening at the auctions with them and it's I know it's terrible.

Karina Diehl:

you know you get these people that buy them and come and trade them in and we're giving them what value is and they're about to fall over because they paid $70,000 for a car that's worth $30,000.

Jim Fitzpatrick:

Oh my gosh, I know it's terrible, yeah, and that'll get around a neighborhood real quick. It does Make sure you don't buy an EV.

Karina Diehl:

It does.

Jim Fitzpatrick:

On that topic of gross profits and sale prices and such, during COVID we saw dealers that were charging over sticker price because they had the car and many say in the industry that may have hurt us in a big way. And maybe the OEMs took note of that and said, hey, maybe we do need to play more of a role in the sales process, directly with our consumers, so that the dealers don't abuse the customer on pricing and maybe some other areas. But where did you stand on that during COVID? That's a tough one, right.

Karina Diehl:

It was a tough one because we as dealers it's supply and demand. Were we gouging people? I don't think we were. I think if I only had two of a particular vehicle and I wasn't getting one for a week, we had to be at sticker or we had to be over because, that's what the competition was doing.

Karina Diehl:

Am I concerned about the fallout in the next few years of these trade-ins where people paid so much money for the used car? I see that as such a problem moving forward when they go because those prices were escalated as well, and where were they going to? How upside down are they going to be? That's right, Insanity right.

Jim Fitzpatrick:

That's right, because it seems like we didn't really learn too much in the industry. I mean, it seems like three years ago was yesterday, in the sense that I think that for a little while the industry said, oh, maybe the OEMs learned. We learned as dealers, we can make money on these cars. We don't need to have a three or four month supply. Maybe we need a 30 day supply, maybe just a 45 day supply. That seems to not have lasted that long and now we're back to Lots filling up and every dealer fighting each other for that deal kind of a race to the bottom.

Karina Diehl:

It does seem like we're right back to where we are Inventory wise. We're not quite there yet, and there are certainly certain manufacturers I'd love to have more inventory versus others. It's very concerning and I agree you would have thought that that if we carried a 30-day supply or a 45-day supply, it would have been a perfect sweet spot, right right, and Tesla, you know they seem to, and this kind of gets back to the EV situation.

Jim Fitzpatrick:

But they're more of a you order the car, they build it, they send it to you. Of course it's EV. They are selling now by far more EVs than any other manufacturer out there. Of course it's a direct-to-consumer sales approach. It looks like there's some manufacturers that are looking at that situation very closely. That are the legacy manufacturers out there. One comes to mind Hyundai. I know that you've got a couple of Hyundai stores. Amazon and Hyundai just came out together and said there. One comes to mind, hyundai. I know that you've got a couple of Hyundai stores. Amazon and Hyundai just came out together and said oh, we're going into partnership here to get our vehicles on Amazon. What is your take on that as a dealer?

Karina Diehl:

I find it very interesting and very complicated. So I don't have enough information and I think they're still trying to work through it as to what their process would be. I just don't see it as a simple solution to selling a car right yes, if you're in my zip code or however the market area that they're going to give me that product. But they would be dictating the price, I assume, but we also know that every car is not the same. Dictating the price, I assume, but we also know that every car is not the same. So for a consumer to click on a button for a $60,000 car, do they understand their option? There are so many complexities there. I'm not sure that it can work At times going to tell and then you talk about the trades and the values and where do we as the dealer fall? So I find it very interesting. I don't have enough information to truly have an educated conversation.

Karina Diehl:

Yeah but it is, it's yeah it's a unique concept, but it's not like buying dish detergent.

Jim Fitzpatrick:

Yeah, it's just not that simple, right, you know where you don't like it.

Karina Diehl:

You stick it in the package and you drop it back off.

Jim Fitzpatrick:

You can't just do that right. Yeah, it's interesting to me, as somebody that's in the media and follows these stories, that they kind of did a ready shoot aim on the announcement where it was. All we're going to tell you is that we're going to come out with something together, but we're not going to give you the details.

Karina Diehl:

I was shocked as well. I actually called my son and said because he's deeper in the trenches with all of this stuff and said, hey, matt, what do?

Jim Fitzpatrick:

you know, about this.

Karina Diehl:

He's like I don't know much yet. This is all new and I've talked to some of the higher ups, that, some of the other manufacturers, and they don't understand it. They don't believe it's going to work or it's a good concept. So I don't know what the timeline is. On that you may know more than I do.

Jim Fitzpatrick:

Yeah, and I don't know anything. I don't either, you know, it's not like.

Karina Diehl:

I've been getting emails about it, sure, it's crazy. I think if it can work and be beneficial for all of us spectacular.

Jim Fitzpatrick:

Yeah. What are some of the other issues that you see as a threat to the industry? As you sit here over all of these stores and these collision centers, Do you see anything on the horizon that you say we've got to be careful of this or that?

Karina Diehl:

Well, interest rates are brutal right now and inventory. I just see the cost of vehicles just skyrocketing Affordability. Affordability is brutal right and I see the cost of everything skyrocketing. I go to the grocery store very infrequently and I'm like appalled at what?

Jim Fitzpatrick:

things cost.

Karina Diehl:

New car vehicles are becoming expensive, you know. Yes, you can get a Corolla at a reasonable price and you can get a Mitsubishi, and all of the franchises we have have these smaller units available.

Jim Fitzpatrick:

That's not what they want, though that's not what you know.

Karina Diehl:

I mean, you have that consumer right, but the cost of cars is going to get prohibited and I don't know how people afford them. You know, do we go from 84 months to 160 months?

Jim Fitzpatrick:

Right.

Karina Diehl:

Like where does it stop?

Jim Fitzpatrick:

Right, that's right, and the numbers are increasing on the terms that we're seeing, absolutely.

Karina Diehl:

You know 70 and 84 months.

Jim Fitzpatrick:

And you're wondering even on that average price of almost $50,000 on a new car, how is that individual building any kind of equity to even trade that vehicle in in the next three years? Right, it's crazy. It's crazy yeah.

Karina Diehl:

Yeah, there are a lot of warning signs, but as a car dealer I'm so accustomed to adapting to what's given to us. You know you don't have a lot of choice. We run companies and we make decisions that benefit us on or benefit all of us when we have to you know again with interest rates and floor plan expense. Right now I'm all over my people on age new inventory, yeah. Right, I mean when I'm looking at a new car that I've had in stock for 160 days. Somebody better have an answer days.

Jim Fitzpatrick:

somebody better have an answer you know it starts to get under my skin, because again, when we look at the cost to floor plan. All of these vehicles. That's right. Yeah, there's no question about it. In terms of some of these disruptors that we've seen out there Tesla, rivian, lucid they have really made inroads on this direct toumer. Do you think that's a threat to the industry? Or do you just as some dealers say, let them do whatever they want to do and we're good?

Karina Diehl:

You know, do I feel it's a threat? I don't. I believe that we, as dealers, offer a heck of a lot. Go try to get your Tesla serviced. Go see how long it takes. At least you can communicate with us on a daily basis. You can find out where we're located. It's easy. If I'm a Toyota dealer, we're all over the country. Yeah, of course, right. We have service centers. We have the years of experience behind us. Does it scare me If the whole world went that way? Yeah, I mean, but I don't believe they'll get rid of the franchise model. People like to deal with human beings as well. I think ordering a car online is great yeah, right, but I also think you need to come in and touch it and feel it and be a part of it.

Jim Fitzpatrick:

Sure, let me talk to you about fixed ops. This was an area that blew up after COVID, right?

Jim Fitzpatrick:

Oh my gosh, yeah, yeah, yeah, it was incredible, and we saw retailers picking cars up from consumers, bringing them in, bringing the loaner car if there was one available to the consumer. We even saw companies and now there's some of the publics that are getting into the mobile business where they'll send the technician out to your house and fix it right there. And I know I'm dropping a lot on you with this question, but how did you fare through all of that in the last couple of years? With regard to fixed stops, we fared well.

Karina Diehl:

I will tell you that I'm all about picking up a customer's car. If we have a loaner available, leaving it with them, I think that's a good. If we have a loaner available, leaving it with them, I think that's a good. Mileage matters, right. I'm not going to have my drivers or team go 50 miles, but I think it's really great for the consumer.

Jim Fitzpatrick:

And did you do that during that time and that stayed with you? We did. We did it prior actually.

Karina Diehl:

So I thought that was always a good compliment to our service department, the mobile side of it. We have to do it for a few of our manufacturers.

Jim Fitzpatrick:

Oh really, they've been mandated.

Karina Diehl:

One has yeah, and 7% of our ROs have to be tied to a mobile repair.

Jim Fitzpatrick:

Really, oh, yeah, yeah, yeah. You've got to love these manufacturers that sit in the ivory tower the rules and say somebody says you know what, let's make it 7%.

Karina Diehl:

Yeah, like who decided that was the number. But in reality, short of doing an update or a dyad, look, we aren't changing tires in someone's driveway.

Jim Fitzpatrick:

It's not. There's no safety. They don't even want it.

Karina Diehl:

They don't want it, we don't want it. So the mobile side I can put wipers on your car. Sure, I can do updates, possibly do a diagnostic test.

Jim Fitzpatrick:

Right, right okay.

Karina Diehl:

Thereafter I don't see it as viable. Yeah yeah, again we have shops with lifts and equipment and tools to anticipate everything and yet again some of the manufacturers are requiring us to do it. You know, that's the difference between the OEM and the retail side we live at everyand you are on the retail side, so you totally understand. It's not that simple as getting a van out on the road with a toolbox.

Jim Fitzpatrick:

And a technician, which are hard enough to come by right now they are so yeah.

Karina Diehl:

That want to be mobile and I know that some of the EV startups are using that model I don't see it being successful.

Jim Fitzpatrick:

Yeah, yeah. A lot of dealers that I talked to during COVID and it was all the rage to digital retailing that was something we heard so much about.

Jim Fitzpatrick:

We reported on it a lot at CBT News. Some dealers said yeah, as many as 10% or 15% of the deals we do are delivered right to the home. Many as 10 or 15 percent of the deals we do are delivered right to the home. The entire deal is done online. This is the future, although the reality is that dip back down substantially and now just a few deals a month are done that way. What's your take on digital retailing? You think that's the future of the business, or I think to a degree.

Karina Diehl:

Okay I, I do. I think digital retailing to a degree will always be there. I would be that consumer. But I also believe that people like to touch and feel. Look, it's a huge investment, right, you're buying a home, you're buying a car, or you're buying a car and renting a home, right? So I think there's a lot to be said about feeling it, touching it, driving it. I think there's ways to make the processes easier and quicker, which is what the average consumer would like. Nobody wants to be in the store for five hours.

Jim Fitzpatrick:

Yeah, no, that's true, that's true. We do need to work on that in this industry, don't we? Because consumers are still saying why does it take so long to buy a car?

Karina Diehl:

Right. But they also forget, Jim, that they're the ones that pick out the color.

Jim Fitzpatrick:

Yeah.

Karina Diehl:

They test drive the car, then we run the credit app, they negotiate the deal.

Karina Diehl:

They negotiate the deal. Then we run the credit app and we have to run a few banks if they're not way up there, so then we have to get them bought. And then we have to push. The government forces us to push what 40 pieces of paper that you have to sign and we have to dot every I and cross every t. I don't know how we streamline it unless the credit app's done, but we need the car and the cost. We're trying Listen, it is, we're trying. But we also try to explain to the consumer that it just doesn't. Now, you know, you can do a portion of it and come back.

Jim Fitzpatrick:

Yeah, yeah, right, we are seeing more consumers do more of the process online, right, yes? And then when they get to the store, oh, I already did the credit app. I already know what my trade is worth. I've already picked out the car. Here's the stock number. Are you seeing that as well? Different beast? Yes.

Karina Diehl:

And we do do that. We will also give the consumer a car and a gift card to go eat something that's a good idea, right?

Jim Fitzpatrick:

So they aren, aren't?

Karina Diehl:

crawling through their skin, killing us on CSI scores.

Jim Fitzpatrick:

Right. So it makes them happy, and it makes us happy that they're out for a little bit. Sure sure. Now we're sitting in this incredible collision center. That really is just beautiful. It doesn't look like a collision center. In fact, you know it looks like we're sitting in an upscale hotel lobby, so you did a great job here. What motivated you to get into the collision business? That's something that some dealers say. I don't have the stomach for that. I'd rather buy another car dealership.

Karina Diehl:

I would tell you we're really good at it and I have a tremendous director who's been a large part of our growth being in the collision side. If you don't know what you're doing, I wouldn't recommend it at all. I mean, we're up to eight collision centers and we're going to continue to grow.

Jim Fitzpatrick:

I mean imagine what it feeds on fixed. Yeah, that's right, you know it keeps our customer coming back.

Karina Diehl:

The minute we get a loss, our team is notified so we can help the customer get in their next vehicle. Yeah, part sales.

Jim Fitzpatrick:

Yeah, for sure, it's huge, For sure.

Karina Diehl:

But you have to know what you're doing.

Jim Fitzpatrick:

Yeah, when you and your husband when he was still alive and running the stores, would you talk about growing the business to this level that you're at today? Was this something that you all said? We're going for it here, we're going to get 22 different franchises or located now. Never, no, never talked about it.

Karina Diehl:

No, never, and it's just snowballed.

Jim Fitzpatrick:

Yeah, it's great.

Karina Diehl:

It's been quite a journey. Oh my gosh. No question about it. But you know, I leave a legacy for my family in doing so.

Jim Fitzpatrick:

Karina, so many dealers around the country have you know their charities that they're passionate about. Okay, and I know you are as well, talk to us about that and your commitment to those you are as well.

Karina Diehl:

Talk to us about that and your commitment to those. It's so important in my life to give back. You know I grew up my dad was carpenter. Didn't grow up with very much so I really understand a lot of what the world needs. I will tell you that it's embedded in me to give back Children's Hospital. I've given them half a million in the last five years.

Jim Fitzpatrick:

I commit $100,000 a year.

Karina Diehl:

They saved my grandson's life. Oh my gosh, wow. That's a story in and of itself. We spent six months, day and night, in the hospital with the little guy.

Jim Fitzpatrick:

He's fabulous now.

Karina Diehl:

But it takes people like us to give back. I bought bulletproof vests for police officers that's great. I bought a SWAT truck recently for the SWAT team. Sure, you name the charity, I'm there. That's great, but I think that more people need to give, yeah for sure. You know I can't give my time, but I can make donations and make the world a better place. I sponsor a month-long pet adoption at the Humane Society where I pay for every animal that's adopted. Oh, that's cool.

Karina Diehl:

Like so many cool things we can do Of course you know that obviously work well for our reputation, but more importantly it makes the world a better place.

Jim Fitzpatrick:

Yeah, no question about it, and so many other dealers that I've spoken to and had the pleasure of interviewing share those same sentiments. It seems like the dealer community is very charitable, aren't they?

Karina Diehl:

I think we are. I think we all understand how lucky we are to be where we are, and the ability to give back is such a gift. That's great. That's fantastic no-transcript Money into the entities. We haven't had that full sit-down talk, but there's trust there, so my children will be protected. I'm not sure how it all plays out. My son's taking a more active role than my daughter cares too, which I'm still working on, her, uh.

Jim Fitzpatrick:

But when you say, working on it, you'd like to see her in a bigger role, I would, I would she.

Karina Diehl:

She hasn't quite found her groove and doesn't really want to be a part of it. But I but listen. I reeled my son-in-law and her husband, who's an engineer, by training. Wow, that's great. It's great Like young, smart people coming in the business. So I plan on being alive for another 20 years. Give or take, right, right, right.

Jim Fitzpatrick:

Got a little runway, as they say, I do.

Karina Diehl:

I do. I'm going to continue to watch the world play out and see where it takes me.

Jim Fitzpatrick:

That's fantastic. That's great. What do you do? I know that this is your passion and you're in the stores all the time, but what do you do on your free time? What's your passion outside of the car business?

Karina Diehl:

You know, that's interesting. I call myself a weekend warrior, okay Right, because during the week I the ocean, I love to do anything I can get my hands on sure, sure, and then that's it right. Any grandkids, yet four grandchildren, my son four, three, two and one, although one just turned five. They're a busy family and they're super cute.

Jim Fitzpatrick:

And, yeah, is it your hope that they get into the business one day?

Karina Diehl:

I want them to find whatever makes them happy sure you know whether our six grandkids or or the four or eight or right they they. They're gonna be lucky enough to choose to be. They're going to be lucky enough to choose to be whatever that they want to be. Would I like to see this continue? I would. Yeah, yeah, but again if it's going to fall apart, then I'd rather see it be sold.

Jim Fitzpatrick:

Sure sure. What advice would you give to your younger self? You know, sitting there, maybe in your early 20s, and all that you know now about life and the car business and everything else.

Karina Diehl:

That's such an interesting question I really would have to think about that.

Jim Fitzpatrick:

What advice would I give? We'll have to go back and interview again. Yeah, we're going to have to do that again.

Karina Diehl:

Maybe not be so crazy sometimes, Sure sure.

Jim Fitzpatrick:

What would your husband think of all of this?

Karina Diehl:

I would think he'd be really proud. I would think he would think I was totally nuts. You know, four weeks before he died for whatever random reason, four weeks before he broke his ankle, he told me, if anything ever happened to him to sell the stores, that it would eat me alive.

Jim Fitzpatrick:

No, kidding, bizarre, right Bizarre when I think about it. So young, 46, 47.

Karina Diehl:

Yeah, and I look back and think there was a part of it that did eat me alive for a long time. This, this is a tough business. It is you know when you sit at the top and you're watching your cash flow every day, which you've been in the retail side. I mean cash flow's king, and that's right. Um you know, it can really eat you alive. But, um you know, would I do it all again.

Jim Fitzpatrick:

I would, you would. I would Karina Diehl, owner and president of Diehl Automotive.

Karina Diehl:

Thank you so much, oh my gosh, thank you. This has been such a pleasure Thank you.

Jim Fitzpatrick:

This has been great. I know that our viewers and our subscribers will get a lot out of your visit with us, so thank you, oh my gosh. Cbt News.