Welcome back to the podcast today, guys. Here today, I actually have somebody worth talking to. Someone my guy lucky. He's got a lot of likeminded, thoughts that I have. And this podcast I think, is going to be pretty dope because I don't think we're going to argue very much. We're just going to both talk about all the bad things going on right now. Lucky, you got a car dealership and ah, I kind of sell cars. I mean, I don't sell cars as a profession. I sell cars more of as a hobby. I have a lot of cars because the rental car industry and, you know, I have kind of pretty decent experience. I mean, I consider myself what would be equal to any car dealer in the city based on what I do on a daily basis.
I think you're being too nice that's the reason why I wanted to sit down with you is, is just the fact that this is your business and you're offsetting your risk by selling your cars. You have more experience than, I'd say, about 90% of the dealers and wholesalers I deal with. I mean, the stuff they pay is just ridiculous funny and the lack of education is even mind blowing.
But I own my cars unlike any other dealer.
Yeah, I was about to say that.
So I was thinking, right as we kind of impromptu had this podcast, I was like, you know, why don't we talk about all the just absolutely mental things that have happened over the past year, year and a half, with with car purchase prices, with the idea of people that were once making 50,000, $60,000 a year, now owning vehicles that cost $100,000. It's not a small metric. This is a really large number. And that's why I kind of want to talk to you because I watch your videos. Because there's not a lot of people in our generation or our marketplace that talk about the reality of what's happening behind closed doors. So give me just a little bit of like, your opinion right now based on we could talk about specifics like the G wagon or some ridiculous things like the urus, how they're going for 100%, even 150% over sticker, which is absolutely mental. But let me know what you think is kind of like the current status and how we got here.
Well, you actually hit a nail on the head. We're not even going to pick anything exotic or anything unique or something. We know that the msrp is ridiculous. We're just going to talk about regular people buying cars. Let's just say a dodge charger. Okay? Everybody knows that's like decent car, 30,000 and $40,000, right? During the Pandemic, we saw all these stimulus ballers. They were making $4,000 a month. They weren't paying their rent. Household was making eight grand. They put $10,000 down on an overpriced. Now $60,000 Dodge charger, average payment, I think on the newer models was around $1,000 a month for a Dodge charger. Dodge charger.
The metric for the average car payment in the United States is over $720. That's real.
So that means it's like a corolla. It's several hundred dollars a month, right?
Because if it's average, the average car would be like a $30,000 Toyota corolla. Correct. So they're paying $10,000 over sticker for a corolla at $700 a month. I don't see this ending well.
No. All these people during the stimulus time were buying these cars, right, and we're like, they have the money, they're liquid, whatever else. But now fast forward. You sing like just like I'm saying, it's slowing down. My business is slowing down. I'm watching Vegas slow down, which we're a busy city. That's why we're here, because we have work all the time. And I'm watching these people that used to make $4,000. They're not making $2,500 a month, and now they're being even laid off. Rents doubled, gas has doubled, their insurance, their food. So now technically, they probably thought they could afford that $1,000 payment. They can't even afford it now. So within one year, the market changed.
Let's just put it in perspective, right? You have $8,000 family income. That's not taxed. I mean, you can elect to have it taxed, but that's not necessarily what anybody did when they were getting that unemployment. I guarantee you they're passing a tax. So everybody was getting $1,000 a week, and they were paying with no bills. So a BMW payment seemed easy because they didn't have rent.
And it went on for a really long time. The rent stopped for a long time. And actually, I think right now I'm pretty sure it was California who passed a bill saying that they have to pay you one month's rent to evict you now.
Yeah, I saw that, too. It blew my mind.
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And then they got to take I've heard that it was like almost a month and a half to two month process to start the eviction. So then they get another two months of free rent where they're not paying, and now this stuff it's I can't believe it. And then I hear these people like, oh, well, you know, the economy's good, the economy's strong, and I don't know who they're talking to. I mean, you're a business owner. I was paying rent the whole time. I'm sure you were your landlord. He doesn't accept all I have COVID.
I really I'm going to have that conversation with them eventually.
And so it's like, we my landlord. The first thing he did, he called, hey, you know, you have to pay commercial rent. You don't have a moratorium on regular rent. And I'm like, no, I know I don't have to pay my apartment. I'm still am. But I'm also going to pay on my commercial real estate. And it blew my mind. And then now that we're facing this shortage, where every day I'm going out buying repos, I'm watching these, like, we picked up that Aston Martin was out front there. I picked it up from a small bank in California. I won't mention the name, but they had for their exotic cars there that we picked up. And one thing they had in common was not only did they have an exotic car loan with this company, they also had a PPP loan with this bank. So soon as they got the PPP money, magically, within 60 days, they're putting 150k down on some of these exotic cars, and now the PPP money's gone. All of a sudden, these exotic highland cars start popping up. And I think, for me, that's what I feel. That what drove our market nuts.
You know, like $100,000 over msrp for a G wagon. Like the Hurricanes, you buy them for two and a quarter. Now what are they selling for three and a quarter? You don't even have to do anything. And it just blows my mind. You could probably talk more about that because what is some of the because can we talk about the Sto? I remember you bought it.
You wrecked it or not you excuse me, a customer wrecked it. You got paid. They crashed it again. You got paid again. And then didn't you sell it again and make some extra money on top of that?
The sto is really stupid. The car was $390,000, and when it got wrecked, it was totaled. The market value of the car was around five and a quarter, which wasn't that much higher at the time because I had a very early Sto. So when new cars like stos or svjs or really crazy cars come out, the first handful of cars don't go over sticker to the crazy extent, as the middle tier does, right? Because not a lot of people know where the market is going to be, right? So before they were 200 over sticker, they were about 100 over sticker. I wasn't able four or five months went by, car sat and sat and sat, and Liberty Mutual totaled the car, and I got paid. I then bought the car back from the insurance, which I typically do 99% of the time. Very rarely do I ever not buy them back because I have the ability to fix them, and or if they're really bad, I use them for spare parts.
You know, think of me a motor could be worth, you know, $20,000 on ebay, but to me, it could be three months of rental. For me, not waiting to have that extra motor of one blows or something like that, that could save me $90,000 right. Just by having it in stock. So I buy the sto back, and I'm like, you know what? It's carbon. I'll fiberglass it back together. I'll fix it. No big deal. And I'll use it as a display car.
We get it from the body shop, and a woman, obviously wasn't thinking clearly, drove and took the front of the car off again.
Because I remember that it wasn't that, like, the day you got no, it.
Was the minute we left the body shop. It wasn't the day. It was leaving the body shop. At the end exit of the body shop, it happened, and she didn't have insurance, so I actually did not get paid. Again, the car was damaged, but the value of the car was literally, at that point, $200 sticker. So I was able to sell a damaged salvage title Sto four sticker. So pretty wild. I definitely did not want that to go down that way because I don't want the market to be like this. Like, right now, my competitors in the car industry are pricing their cars so low because Vegas has slowed down by 70%, 60% of high end travelers. They're literally renting hurricanes down the street for five, $600 a day.
And they think they have no recourse for that. Now they're going to find out real quick that they do have recourse because the cars are depreciating. So when a hurricane was 325, it's now 250?
In an hour. It just takes one car to go through auction in an hour, and it's gone. I had asked him, Martin dbx last week that had an issue with the front hood. I replaced the hood, did some paint work on it. It was the mmr, and it was 170. Dealer offered me 165. 3 hours later, he's like, nope, can't pay that anymore. One just went through auction for this. I ended up selling it for 140 in a day. It dropped $25,000 in a day.
You know, and so not a lot of people understand that. And dealers have a really hard time. They floor cars. On your channel, you talk about car flooring and financing and stuff like that. I don't for the cars, and I have a way to make income back. So let's say I did buy a car for too much. I could rent it down. I wouldn't make any profit, but I could throw it in the rental fleet for three months, make maybe $30,000, and basically buy the purchase price of that car down so I don't lose physical money. dealerships don't have that opportunity.
They've got a car sitting there.
Then you hit it right on the head. They don't have any money. Every dealer I know, it's all floored. Yeah, it's all credit. They they don't have any money to their name. They're all buying these crazy cars. And to them, it's another $100 at the auction. So if they're competing with somebody like a buyer like myself, or even somebody like you, you're using cash. Cash buyers are more discerning. We look at the numbers, we pay more attention to that. These guys just another $1,000 on my flooring line. Let's just keep bidding it up. And now I'm watching that all these dealers have all this overpriced inventory.
Oh, my God, I feel bad.
If you're watching this, you're a dealer. If you have any overpriced inventory, 30 to 60 days, sell everything you can. You can always go back to the auction, replace it. You need to write that depreciation wave down, because now that the repos are coming in and then we also have all these dealers that have all these lines of credit. They can't pay. They can't sell anything. I won't mention names here, but I see a lot of dealers here in Vegas with really high end inventory, and it's been there, like, three or four months now. They did the whole, well, I can't replace it, you have to pay sticker. Not anymore. Those days are gone.
The thing is, people don't get why the market went up. The market went up because everybody had free money, right?
You put $6 trillion into the market, and they're going to spend it. Well, it's spent. And the people that had $6 trillion don't have it anymore. They've got a G Wagon that they paid 300 grand for that has a sticker of 164. They've got Rolls royce Cullinan that they paid 550,000 for with a sticker of 365. They have all this overpriced stuff, and maybe they have it paid off in cash. That's really cool. That actually devalues the market more.
Because a lot of people are willing to take if they bought her 500, they're willing to take 400 back because it's 400 in their pocket that they can then put back in for bills or whatever versus guys that have huge loans that have to take, at the minimum, their payoff. So the payoff situation causes a lot of confusion because there's an inventor that I'm trying to buy right now with a blown motor, okay? I happen to have an event that's motor just sitting back there, waiting for a right opportunity, right? I bought it because I built a twin turbo car, and I was like, let me just get a spare motor.
Insurance just in case.
And it's just sitting back there on a pallet. And so this blown motor eventor comes up. It's been tuned by a performance shop in California that wanted to spin a lot of fire, right? People don't really understand what that does. An engine, anyways. Boom, boom, boom. Blows a rod, needs a motor now, an event thrower motor at the dealer is like $200,000.
So this guy's got this 18 event with 6000 miles. His payoff is 280. I offer him 220. So if the car is really worth 250, probably he can't sell it for us. Whether or not he has the money or not in his checking account to pay the difference and sell it, he's more in mind saying, I'm just going to sit on it, make the payment until the market goes up. This isn't real estate, dude. I told him, I was like, what do you think is going to happen? That car, you know that that car prior to the Pandemic was worth like 200 off sticker. Like your sticker is 587. The car was worth 387 before you bought it. And you paid 550 for the car. Because you're dipshit, right? It doesn't make you right, it makes you stupid. Now the car is worth I told him, I'll give you 280 for the car. I'll pay your loan off, break you even. Because I've got this mortgage are sitting here, I can put a motor in it and I could turn it around and sell it for maybe 445, 450 right now, because the ventilator markets come down to about 100k wholesale, right?
There were 650. Now they're like 550. But no dealers are willing to pay 550 because they see the trend. So now, as a dealer, they're going to want to hit it under mmr, way under mmr, because they see mmr Data is 30 days behind.
So it's not there yet. And it's like a falling rock, just like crypto, right? If the market shows that bitcoin is 22,000, but it just was 28,000, chances are it's going to be 18,000 real quick. So don't go and buy it for 22 when it's going to turn into 18.
No, and that's that's something that I'm seeing a lot of these dealers doing is we talked about the subprime market on my channel where just regular people, cheap affordable cars, that's part of the issue that is going down as far as value. But one of the first things, indicators we see is the exotic car market. That market takes a big hit. We're talking 10%, 15%, sometimes a month. And what I've seen, like, I had a similar issue with you. I ran that Aston to give me the Vin.com. They were going to give me 150k for that car. So I was cleaning up, getting ready, I was waiting for the title to come in and finally came in. I went back there to redo price. It dropped to $131,000. So I lost almost $20,000 from two weeks. Now people are laughing like, well, that's a lot of money. I don't see that's not normal. You got to remember, if you lose 10% on a Toyota corolla, it's a couple of $100. When you talk 10% on like a $500,000 car, 50 grand, yeah. You're talking big chunks of money literally.
Just happened to me. I just cleaned out, like, eight cars because I saw this trend happening. And I just bought a brand new Rolls royce phantom. Brand new, 2022. spec it myself. And I was like, dude, I am going to take a big bath on this car.
Is that the colony?
No. The conan. I just sold also because same thing. The conan, my pink and tear conan was worth 100 over sticker. And I'm sitting here thinking, okay, I can keep this car six months. My wife's going to love it. Everything, it's superficial, all super nice, but at the end of the day, like, it's still going to be worth less. And I told my wife, I said, you know, if you want, we can sell this car right now. And I bet you I can get 40,000 over sticker for it. And it was a high sticker, you know, it was a 400 and something, $38,000 sticker, which is high for cullinan. She agreed. She was like, I don't care if I have this car. Like, it doesn't matter to me. She's so like, my wife is so opposite of me. I'm like, super pretentious.
And she's just like she's the balance that gives you levelness.
Exactly. So we sold that one. And then my phantom was actually supposed to arrive in five months after the cullinan came two weeks later. And I was like, I wonder if Rolls royce saw this coming too. Were they rushed production?
Rust production? People canceling allocations?
Or maybe they had a lot of cancellations in other countries because the markets are different everywhere, but as a manufacturer, they share the whole world. So car showed up super early, and I just knew it. I just knew for a fact I had to sell that car the second I got it.
You know that feeling you get like you're watching the market and you see it trending down? You're like, okay, let me hedge myself. Let me get rid of some of these cars, and I'll just wait and maybe buy some, like, a little bit later. I don't know why more people are not doing this. We can talk about this. And that's another reason why I wanted to bring you on here, is because this is something just the way guess car guys think. Real car guys, not these broker jokers. Everyone out there trying to flip exotic cars. And it's like so we're watching this trend. And even today, like, at the auction, I was watching guys over here at mannheim bid 510 $15,000 over mmr on not even like a really nice mclaren, like a high mileage, like 20,000 miles mclaren. I hate mclaren. I think you gave them just as much as I do. I mean, they're beautiful cars for the first 2000 miles. What I heard is something you said. You only keep your cars 5000 miles.
By max, from zero to 5000. I won't take a car over 5000 miles yeah.
I've been on so many rallies where it's like, we start with, like, five.
Mclaren and you end up with zero.
None of them.
Everybody that has either classic cars, whatever else, makes it to the end of the rally, and then it's like, where's all the they're all gone.
They're all gone, yeah. And they never make it.
I can't believe with that much money and spending, but I'm watching these people pay for it. And then another thing that's kind of making me mad, which I'd like to talk to you about, is these clowns that everybody jumped into the rental car game. I've been making fun of these guys a lot on my channel, and now that I'm here with you, you're the only other person I know. I think it's you, me, and then probably Rob over there on the East Coast that actually rented out cars with a real license and real insurance. Where the rest of these guys? I don't even know. I'm still shocked that these guys are not shut down, because I remember telling you off camera, like, when I got my dealer's license, I put rentals on my sign. Like, the next week, the dmv was knocking on my door, where's your rental license? And I'm like, oh, was it under a different llc's name? Here's my license. Here's my insurance. Here's my bond. They let me go. But then if you're not a licensed company here in Vegas, people don't understand, like, the reason why I'll let Houston go off on these guys.
But I want to go off them first when I'm trying to rent out a car. And, you know, even, like, I did regular cars. You did nice cars. I was doing Nissan altimas, and I was renting them out for, like, 50, $60 a day. That's what it costs for my insurance, my bond. You know, the pay down depreciation mileage. And I had these guys on, like, turtle or just running them off the streets for 40, $30 a day, and it just killed the market. And then I tried to do a few high end cars.
Not even chance.
The thing is, with rentals, most people try to rent their car to make their car payment. That's not the right way to do it. But honestly, you can keep this rental business. I built a big brand, big social status, and a big kind of enticing looking business to copy. But the rental car industry is inconsistent, and that's why I've transitioned into food, because I want consistency, and I want those customers to come back, and I want to be able to control the situation a lot better.
For me, in order for you to rent my car, you first have to, A, travel to Las Vegas, b, have more than usually one day or two days of leisure time, then C, have $2,000 to rent the car and then have the proper insurance in order to drive the car. And then the important thing is the maturity level to operate the car in a safe manner. And so there's a lot of factors that go into my business that are just kind of over it. I mean, actually, this week I'm selling all my auto cycles. I didn't want to have that customer anymore. Plus, like I said, on touro, I rent slingshots and vander halls and stuff because I pay them right. I pay 40,000 or $50,000 for vanderhall, and I know what it takes to operate those, you know, so they're about $350 a day to $380 a day, depending on what it is. And I mean, it could be higher based on the cans for the sports games and stuff. But you go on turo, you can rent a slingshot for, like, $60 now.
Yeah, it's like a race to the bottom. On touro.
It's a race to the bottom.
Turo was good because it gave people the opportunity to jump in, but then it gave everybody false pretenses. So now they're no longer renting on Turtle. These guys are getting, like, storefront offices like ours and trying to rent them out to the general public. And one thing that I think that will be really good is, like, we talked about how, like, the insurance, the correct paperwork, checking people's ID, checking their insurance, verifying it. There's so many cars out here not insured. They're under somebody else's name, and they're like they borrowed, like, give me your car, Houston. I'm going to rent it out to my buddy, and I'm going to give you a piece. I'm going to keep a vig. Like, I feel like that's nice, 90% of the rental.
No, it really is. And that's the worst part.
I think it's funny how when we talk about the rental business, everybody wants to do it. And I used to sell a lot of classes on my channel, and I stopped doing it because the rental business is good, but it's not what it's cracked up to be. And it's funny because everybody I talk to that owns a rental car business, we all say the same thing when people ask, is it lucrative? Is it good to get into? I was like, no, it's a freaking headache. It's a nightmare.
My YouTube channel doesn't make that much money, and it pays more net profit than my rental car business.
Yeah, I made a joke when I told people that, when they're like, well, how did you make your money? I was like, off a loss of use. What do you mean? What's that? I was like, when they crashed my car, the insurance company pays me for all the days they're out. So it's pretty bad when I'm talking to people like yourself that are in the industry, and we're saying, like, this is how we actually make our money. Like, from when they crash our cars in total amount, and they don't believe.
Us but the car industry sucks, man. If you want to be in the car industry, you need to do as a hop lobby. So I'm not going to close royalty because I spent a lot of time and it's kind of like my baby. But I'm not going to expand royalty. I mean, I was considering to split my fleet. I'm going to go to Hawaii tomorrow and get like a little location there, split my fleet. Because I don't really want to close up shop because I have a lot of employees here that rely on this and they're good. So I'm going to help bring up the revenue a little bit. But in Las Vegas, definitely the rental business in a major city like Los Angeles, Las Vegas, Miami, maybe Dallas, honolulu or something like that, they're the only really areas you can even do this. You can see, oh, everybody calls me all the time. There's no rental car company in Kansas City, Missouri. We should put a hurricane here. And it's like, dude, I love that you want to do that. And I love the passion, but out of the 1500 to 1800 people that rent for me per month, two or three of them live in Las Vegas.
Yeah, that's it. So I don't see how any locals anywhere are going to do that. They do this on vacation, right? Los Angeles. Same thing there. They do it for movies. They do it for production. They do it for a lot of different things. And if you have a really good in in that industry, it's super cool. I used to do a lot of production work, but then they took it in house. They were renting cars so many times, they just bought them. Studio has the money now. Just buy a lambo and let it sit there.
Old props for the movie houses. And then I realized after I built it, they put it in their prop warehouse and they don't need us anymore. Okay, I got you this one time and they were going to burn it up on six other films, but same thing. They had shells of lambo, shells of ferraris. But like you said, I get these calls that people like, oh, I want to open one up in Atlanta, Georgia. I'm like, don't do it. I want to open one up in Tennessee. I keep telling people, don't do it. Vegas has the volume, I think, like the big cities you talked about, they have that type of market. But when I see people like, well, there's nobody else here, I was like, there's a reason why it's like you're not rocket scientists. We're not creating something new. It's just the market is just not there.
The rental car business is so cash intensive. If you have enough money to start this business, I can give you like, I just started the fund for my chicken business, right? And a lot of people like, I've got 1000 plus. Franchise applications. And not everybody has enough money to open a franchise. Takes plus or minus $600,000 to open one store. That's with your fees and all your opening stuff, it's a lot of money.
But a lot of people have, like, $200,000. And so I made this fund where you can buy 5% of a corporate store for 100 grand. That 5% of a corporate store for $100,000 is more guaranteed. It is safer. Now, you can buy up to 25%, right? So if you have 500 grand, you can buy 25%. And that would pay you, based on my current projections, like, 15,000 a month.
Net, that's me sending you a check for you to make $15,000 a month net from cars. You would need probably four Hurricanes in Vegas.
Because you got to consider that there's a building, there's rent, there's employees, there's insurance. I mean, my insurance is about $2,500 a month per car.
Now, it was about $3,200. But I got them to come down a little bit because I paid so many payments and whatever. And it's just like, once you add all that in and you have really high volume, you have to advertise on Google, spend 50, 60, $70,000 a month on Google Ads. My dream is to actually just turn all of that off, have an organic website with ten lambos, ten Hurricanes, right. Or maybe a couple of ferraris and a couple of maybe porsches, right?
Very small, diverse fleet. And do no advertising. Just wait for the phone to ring.
More of a boutique set up.
That's it. I swear to you, that's how no. Out of the same building I'm in right now.
Hotel would be better, but you can't really wash the cars in a hotel. That's a big problem. And what a lot of people see is, in order to do the volumes that I'm talking about, you have to have a car wash, you have to have a service center. You have a tire machine, or you're just renting subpar products.
Or $100,000 svj Motor just lying in the back on a pallet. I'm glad we're talking about this, because in my channel, I tell people all the time, and they don't believe me. When you're insurance, like, you hit it right there, it's $2,500.
That's per car. You have to have 25 cars to even get that policy. Right. It's, like, so ass backwards of what you think would reality would be to be in this business.
Yeah, I'd like to talk a little bit about that because I think that's probably one of the most interesting things that people don't understand. Like, part of my channel, I tell people, like, if you start a rental car company, like you said, you have to have 10, 15, 20 cars just to start your policy. And then on top of that, most of these people, their cars in their name has to be in your llc's name. Or some sort of corporation can't be in your personal name. And then on top of that, you're going to have to have a starting cost of I think when I started mine, it was like 1220 grand, but I was able to piggyback off my dealer's license insurance. But I remember my rent for a Nissan altima went from one hundred dollars to three hundred and fifty dollars a month. Which doesn't seem like a whole lot, but to compare to what you're doing, like $2,500 a month, your first two days of a rental is pretty much overhead and insurance, not even including cost of the car or maintenance.
Yeah, that's even a really good point. You're talking about two days of a rental.
I'm renting the car for basically $1,850 a day or $900 a day. It's on two days of profit. You're maybe making 1213 percent net profit in every rental when you factor depreciation and maintenance tires and all that stuff. So you need to rent the car just like 1012 times just to break even on what it costs to own the car.
And then if you rent the car more, your expenses go up.
It's not like you're renting a car and ten times breaks you even 1112 13, 1415 is cash. It's not because the variable expenses go up with it. So it scales taxes, scale insurance, scales employee scale. Car wash is crazy, dude. I spend $30,000 a month on fixed costs just to have a car wash.
He has the most epic detail bay the lights, the epoxy floors.
It's not even done, dude. I literally half asked it, too. It's crazy because my vision of that place and what I really, truly needed to do was another 50 grand. And I was like, oh my God, I'm spending so much money on this business. And I opened it up to the public so they can come wash cars so I can kind of recoup some of that investment. Yeah, but I spent $500,000 on that car wash. Wow. So do you know how many cars they have to wash in order for it to make money? Like a bajillion.
Like a bajillion. It's like somebody like yourself that has a high end facility that's got to spend that extra money to have that over the top detail bay. I think these are some of the things that make you guys so much further apart than the competition. Because when you said my competition in town, I only know one other person that actually has a license, which is still kind of half half. But everybody else, they're not even close. They're like four dudes renting out a lambo together.
There's really nobody in town that competes with me. You can rent a Hurricane somewhere else. It's not really a competitor. They don't have the same kind of cars. They don't have the same stuff. I mean, look, even if they got better cars than me, right? It's a different experience. The person that you're referring to is a 400 square foot office in a parking lot. We're not talking about the same thing. You're talking about going to Del taco, and I'm talking about going to javier's. They both sell tacos. They're just different quality. It's a different experience, a different customer service. It's a different also, not a lot of people understand this, but you get what you pay for, right? Let me just give you a little story. I have a hurricane that gets rented. They go out to Valley, a fire, they pick up a rock, get a flat tire. What happens?
Well, usually we send a tow truck, pick them up, but I think you have a tire truck, don't you?
Yeah. In a normal rental car company, they're like, hey, here's a tow truck's number. Get it back to us. Your time. Your clock is still ticking. Because they're not prepared to do anything, I take it a step further, and I include with my rentals the ability for me to go out there. I have hundreds and hundreds of spare wheels and tires in my warehouse. I throw one in the van. I get out there, I change it for them. The time it takes me to get there, 30, 40 minutes. Ten minutes to fix the car. And then my guy comes back, I add that extra 30, 40 minutes their time. Say sorry, guys. Now, if they cause the issue, I might charge them for a tire, right? They were doing donuts or some stupid stuff. I'll charge them for a tire. But I'm going to go out there, and I'm going to make sure that they're getting back on the road within reasonable time. I have that ability, right? The other shop guys, the other guys in town that have lambos, they just have to send that car to discount tire. They have to wait for a tire to come in.
They don't stock the tires. Half the time, the guys call me for tires anyways, and it's a really stupid process because that happens all the time, right? Little tiny things. Flat tires. Flat tires or bent rims or any of those little things. I can put the car right back on the road in 10 seconds, but those guys can't. And so when you rent there, you take that risk in any hazard or any maintenance, too. I mean, you get an engine light or you get a tpms light. People that pay $2,000 don't know what that means. And when they see that on a landboard, they're like, oh, my God, I'm broke.
Yeah, I'm broke. That's the first thing that they think of. So look, at the end of the day, don't rent cars, please. If anybody calls me and ask me how to do it, I tell them not to.
Yeah, that's the same thing.
If you offer me $50,000, set up a rental car company for you, I would say sorry, I'm not interested. Literally, I don't care. There's no amount of money that is going to let me help you fail. I don't care how smart you are, how much money you have. This industry is not able to support itself anymore. The cars cost too much, the insurance is out of whack and there's not enough customers that will give you the inflated prices of rental rates that you need to survive. I didn't raise my prices for inflation, but everybody else did. Tires are $900 when they used to be 350.
Like fuel cost and oil cost and service cost, employee cost, all of it went up. But do you see my prices at $3,000 a day? Because that's what they should be. Yeah, they're not yeah.
See, this is the fact that people watching this understanding all the expenses that we talk about, like, he just broke down all of them. So remember this, when you guys come over here to Vegas and you're like, bro, hook me up. Give me a rental for $500, most likely we're going to tell you to go pound stamp. That was one of the biggest things I sold my dealership and got out of the car business. Just want to do wholesaling was just how often do people like, I don't mind my friends ask me for like free service or a hook up, but it's everybody like if they watch your YouTube channel because I think it's different for you because I didn't do YouTube. I did Facebook ads and so I had people come in like ask me for free stuff. But I could imagine what you guys deal with. How often do you get people coming in? Especially I won't mention youtubers names directly, but like youtubers themselves, do they come in bug you guys a lot for free?
Shit, I haven't had a single youtuber ever offer to pay me, actually.
It's just so dumb. Honestly. We could talk about this business so that I can't think anymore. I'm never going to give anybody answer. They think they're going to hear the amount of people that are in this industry now that think they're going to make money. I mean, there's guys that sell courses on how to do this. They try to come up with every which way it is to make you think you're going to do a profit, but you're not, right? So it's funny because when those guys online, like the top rated guy online selling courses or whatever, I shouldn't even say this, but it's all fake, man. I don't know why people believe it.
Oh, it's not. I've got sent courses and I'm like, this guy is talking about getting leases and other people's names, renting it out with like a contract or your attorney wrote up. I'm like, none of this shit is legal.
It's all fake. It's not real. You can't do any of that stuff. It's not renting a house. The world was set up. Real estate and airbnb is set up because it's a logical thing to buy a home and rent it to somebody, right? That's a basic necessity for someone to stay in a bed and not sleep on the streets. But it's not a basic necessity to drive a luxury car. So logically, people aren't designed to loan their cars to other people and let them have fun in them, right? But when it comes to a home or airbnb, if you want to buy a three or $400,000 asset and rent it on airbnb, it's a challenging business. You could maybe make a few thousand dollars net a month. And maybe if you have a million dollar house or something like that, you can make a little bit more. But you're going to have the same challenges that I have renting a car with people that are abusing it. They're having too much fun in the car. They do the same thing in the house, right? They leverage a very expensive house and have ten people sleep in it.
Obviously, that causes extra wear and tear. It's a lot of hassle. People make big messes. But ultimately, the laws are there to protect a homeowner. In this case, the laws are not there to protect the car rental company.
Oh, yeah. 100%.
If I say lucky, here's my car. Go have fun. 4 hours and you decide to come back in seven days. That's a civil matter. That's not a stolen car matter or nothing like that. That's why I can shut my car. I have the ability to do everything with my car. Yeah. There's no end in sight. I mean, I actually went through this. I had a person rent a car and then they decided to steal it, right. They just took off to California, and this is the first time it had happened. I called the police. I'm like, hey, some guy stole my car. Go get it. They're like, well, you have a rental contract. And I said, yeah, I did. For 4 hours. It's been a day?
Yeah. Oh, it's embezzlement. It's a civil matter.
Exactly. So ten days. They have to be gone for a minimum of ten days for it to be considered a stolen car. Even though I can tell them where they are, they will not intervene. And so that's Nevada. Now, it could be different in other states, but why would you want to be in a business where you have no control?
I tell the horror stories all the time. Same thing. People taking my cars, leaving them in the desert, losing them on the strip. I gpsed every single car I had because I had so many people that I don't know what casino was at. I was drunk. Go find it. And they would just like, mail me or FedEx me the key or drop it off in my dropbox. So now it's like I literally paid my guys more money GPSing them is.
A very simple thing. Now my systems are so sophisticated that I can talk to you through my gpses.
Yeah, that was the next one I was going to get. We had geforce trackers every time they were doing donuts, going through different things. I had all the racetrack geofenced. I had all the towyards. I mean, stuff like this that you guys don't really get to hear, which is kind of neat, just the fact that we have to do this to protect it. And I was doing this on Nissan altima. You're doing this on $300,000 cars. And these systems, I remember the one I had was like four or $500 bucks with the starter disabler, the tracking and everything.
I do multiple systems on the cars. Now, the biggest defense I have is just choosing who I rent to at this point. Right now, I don't care who you are. Walk through my door, I'll tell you if you're going to be good or bad, I can just feel it and have the energy, right? And so that's one of the reasons why I definitely think you should never get in the car rental business, because it might seem easy on the surface. Oh, well, they're going to come in, they're going to pick up this Nissan gtr, give it to him for $500. See you later. And a boss says to the employee, employee gets the car, checks the insurance, doesn't know what he's looking at, right? assumes it's good. Guy gives them $500, takes the gtr, ends up in another state, it gets impounded. Now, how are you going to get it out 30 days later? You've spent 2000 $3,000 in impound fees. You've lost all your rental. You finally get it out and it's got damaged wheels, it's got a cracked windshield, three, $4,000 more in damage. Before you would know it, you lost 1015 grand, one car rental because you weren't there to oversee it.
All for some stupid little piece of paper that you didn't read, right? Standard non stop. Happens all the time, right? And so at the end of the day, when you own these assets, like when I have these cars or my cars, I don't drive those cars home. I don't give a flight about what those cars do. They are tools for me to make money. I don't care if it's an svj, if it's an sto, if it's an F eight, doesn't matter. Occasionally, when we get a brand, brand new car like the sf 90, I'll take it home once I didn't get to drive them.
However, you had it for like a month, and then you're like, yeah, I sold it.
It was too fast. I didn't want to risk on a dying. I've had a very good I have no injury accidents and over 55 some thousand rentals, zero injury accidents. And that one was where I was like, you know what? This is dangerous. It made my turbo hurricane look slow. Feel slow. It was wicked.
I would have drove it.
Yeah, I mean, I took her on the block. I actually just drove up, down the street. I didn't go home in that car. I went down Dean Martin back to Dean Martin. Down Dean Martin. Back to De Martin. Gave every one of my employees a ride, made two of them throw up. I got a headache myself. Parked the car, never touch it again. And it got rented multiple times. But I felt like when it got rented, it was a lot of speed alerts on that car. A lot of issues, a lot of potential things. And so I sold it.
But like that being said, a lot of people rent cars because they think they can just drive one for free, right? Like, oh, George is not renting. Let me just take it out for dinner.
That's like a drug dealer using his own cocaine. It doesn't work like that.
You cannot ever touch those cars. You cannot ever involve yourself in driving them as your own, because then, A, you're faking your lifestyle mentally, and it's going to ruin your brain. People think that they're rich when they're driving these cars and they're not theirs. The rental car company is paying for them. I can write a check for every single car out there five times over. And at the end of the day, when you take that knowledge and you apply it to this industry, it makes you smart.
But if I have to go out there and finance a leased hurricane and I'm making $3,500 payment or something like that and I want to use it on Saturday night, I should not be in this business.
100%. When we first started, we did a lot of stuff that wasn't right. And we're speaking from, I guess, a point of angle of experience. Like, you put a super experience. You bought a car you couldn't afford when you first started. You were renting it out.
Actually, let me rephrase that.
So the way I first started was I had a good job. I got injured. I had one $800 car payment, and so I had a broken back. I got in a really bad car accident, and then I couldn't afford it because I wasn't able to work. So then I go around to see if I could rent the car because I was trying to think that maybe I could rent it maybe three or four days a week and not have to get rid of my car. But this is like, when I'm 24 years old. I mean, I was so naive.
Like, it worked out to where someone gave me an opportunity to rent my car, but the second I started to rent it, I realized that this is not my car anymore. I mean, it's getting trashed, right? smells terrible. Okay. I felt like I was using someone else's stuff.
And so I ended up buying I left the gtr as a rental, and then I bought myself a gallardo.
The gtr could pay for my gallardo. That was my theory.
Then the gallardo was like, this is cool. I'll rent the gallardo, I'll buy myself a four, five, eight. Now I got a nice car. This is cool. I'll leave the four, five, eight. I'll buy myself a mclaren MP 412 C. Now I got the best one. And then I wanted an inventor. Basically, before I knew it, every three, four months, I was getting a new car for the fleet, and I thought I would love it, to drive it myself. And that was going to be my car.
Even down to the BMW I ate, I did that with. And before a year went by and I was driving a fiat 500 Electric.
Like a little dinky car. And that's what I wanted to take home every day. I mean, I did technically buy a Rolls royce Ghost. That was the longest one that was not in the fleet. I bought the Ghost and I was like I used it to pick up our customers. Before, when royalty was super small, I could pick up every customer from my hotel and schedule them out through the day. I was doing five rentals a day, pick up and drop them off, have everybody was one perfect experience. Super boutique. It was great. So that car was actually the car I drove the most. And then I ended up getting a little bigger and renting that one as well. Going to the fiat 500, just having a simple, small, quiet car that wasn't flashy. And now, fast forward eight years later, I've got a koenigsegg, a pagani, a bugatti, all these wild hypercars.
I was going to say, what do you think is like like about $12 million sitting right here out there?
Unfortunately, there is about 12 million.
The only chicken sandwiches I could have for that much money.
If you were to do this right now, if you had to sell all your cars and let's say you're going to sell royalty, what would you do next? I know you're doing the chicken thing. I think that's already going. But if you sold all your cars and everything else and you were liquid, what would you start next? What would be your next adventure, your next journey?
If I had to do something other than the restaurants, because the restaurants is my plan. I mean, essentially, the way I looked at it 15 months ago when I started the chicken business is I wanted to do something else. I started before the Pandemic officially started.
We were talking about this in 18.
Yeah. It has a 19 probably right around there.
I really wanted to be in the restaurant business because I saw the future and I saw my revenues dropping and I saw the increases going up for the cost. And I was thinking to myself, restaurants where I got to be because everybody needs to eat, right? So if I had to choose something else besides restaurants, I would probably take it. it'd be a large amount of money that I would have.
I would probably go into, like, apartment complexes, some larger real estate type investment. I've been hanging out with Graham, Stephen and Ryan Penieta more than I should.
And so these guys have got me thinking, my real estate might I would develop real estate projects. What I learned from Ryan a couple of weeks ago was he bought a 0% occupied, almost abandoned apartment complex, rehabbed it for X amount of dollars, got it essentially 50 or 60% occupied, and then was able to sell it and make a net profit of over four or $5 million.
And I think his total investment in that was less than his net profit. So I think he put, like, 3 million in to buy it and rehab it and then made, like, four or five. And so that's the most attractive thing for me, because I want to sell a product that has a lot of buyers, and real estate is always going to have the most amount of buyers for any business. And I think second is food, right? Because food is the most scalable business as far as a brick and mortar company. You can put a houston's hot chicken in any state, any city, any country, and anywhere in the world, and someone's going to go eat there.
Well, they had Forbes put a list of the three recession proof businesses. There is fast food, okay, alcohol. And then there's payday loan stores.
So these three that's payday loans, that'll be our I'm down payday loans, loan sharks.
But my friend, fucking, we got a Rolls royce ghost. The guy didn't pay on it all the way from La. To here. borrowed seventy K. I think at the time, it was worth, like a buck 80. Guy paid, like, three months. I think it was like seven grand a month for three months. Wind up not paying. Kept the car. He sold it. I'm like, okay, where's my cut? Well, this is my business, my license. I was like, I fuck you. More people.
He mentioned this a couple of days ago, was payday loans, right? Payday loans are solid. When I was a cable guy, I was just driving down what I was referencing right now was I was driving down sahara. I had to go pick up a check at Mercedes. I sold them one of my vans, and they had to pay me for it when they got the title. And I go to pick up this check, and I remember this place called Cash Kingdom right across from Mercedes on sahara. And I did the cable install there when I was, like, 19. I'm like, I'm 33 now.
It's still going strong.
I don't know how many people are actively walking in and out of that place. But if anybody needs a loan, I will give you $1,000. And if you just pay me back $20 a week for the rest of your life? Yeah, that's basically what it is.
Yeah. A lot of these repo companies I'll go to, where I pick up the payday loans, the title loans, we're talking 2300% on a vehicle, sometimes even higher when it's like a non secured loan. And so now they have a title for collateral. They're still getting this insane interest rate and they're taking like a $3,000 car. And I've looked at some of the contracts, these poor people over the last two years that paid like 8000, $6,000 for this $3,000 loan. And they still owe three grand.
And they wind up getting the car back. So it blows my mind. But, you know, I mean, I know it's kind of bad, but I mean, just the money, you see?
And at the end of the day, I had an employee, multiple employees, that would go to 2345. Payday loan companies take 1000 from each one. In Nevada, you can get $1,000 sight unseen. Basically with the driver's license. One of my employees went to like eight of them, got like $8,000.
Bought a bunch of dumb stuff, playstations and shoes and just shit at $20 a week.
He was paying $160 a week. And yeah, he just paid $160 a week for a long time and never paid him off. So I went in, I helped him, I paid all of his balances off. I refinanced all that for him for one payment. And it took him a year to pay me back with a moderate and like very low interest.
And I charge him like 89% compared to 300%.
Yeah, 300%. He'd be paying until he retired.
He would never end up paying it off. And then their collections are this, they're that. These guys, they get stuck in some crazy stuff. But my point is essentially like the car rental business is cash intensive. It's not like you can go and leverage your credit $50,000 and you can get three lambos. It's not like that. If it was like that, then I would recommend it because there'd be a low acquisition cost for these cars. But there's an extremely high acquisition cost.
The transport industry, same thing. High acquisition cost.
You need a truck, you need a trailer, you need insurance. transporting cars, five, $600 to and from California seems very lucrative. I could do ten a week. Shit, I could make $10,000 a week or $8,000 a week. But once you factor in everything that goes involved into the labor and the employees and everything, maybe you could make $2,500 a week from the initial 5710 thousand dollars you think you're going to make. The same thing happens with car rentals and anything related to automotive stuff. Right. That's a brand new story.
I'm surprised you we talked about this for a long time with your brand and everything else. Like the way you kind of turned royalty into, like, the houston's hot chicken grew YouTube brand, your personal brand. I'm still shocked that you don't own a car dealership.
I have a car dealer license, but it's just you kind of have to choose one side or the other, right? You got to choose to be a car rental company or choose to be a car dealer. I think I'm changing my opinion on that as see, when the economy gets bad, it's easy for me to sell cars, right? Because then I have the best cars in the market. But you know how attractive it is to buy and sell wholesale to get paid in 30 seconds? Yeah, just so easy.
Preaching to the choir. No overhead, no crazy bills. But I can see you with your brand, like, crushing every exotic highline dealer that's here in Vegas, also in La. And maybe even scottsdale, because a lot of these guys, like, they watch our channels. And, I mean, just the reach you have, I think, alone is like a dealer spending 2030 $40,000 a month on Google.
You crush everybody.
Look, I thought about doing I haven't offered reality TV shows for three or four years now. And every once in a while I go a little bit more and I'm like, maybe it's time for me to do this. And I was actually offered to be on the show with Rd whittington Million Dollar Wheels or something.
And I was offered to be on that show to be rd's adversary. And me and Rd are not cool because he screwed me on my bugatti situation, but that's a different story. And I was offered to be his adversary, and that was, like, the closest I'd ever come to wine show because I was like, I'll do this for free, man. But then they wrote it in there that I would have to not do YouTube. And I was like, oh, I can't really do that right now. So I passed on it. But I was pretty stoked about that situation. And I was thinking to myself, like, guys like that, they go up there and they make this whole fake story about how they can sign this law Ferrari, and then they sell it to this celebrity and do this, and it's all fake. It's like selling sunset. I mean, these houses, some of these houses aren't even for sale. They just go there, they tour them, they bring a fake buyer, they set it up, and then boom, it's 40 million. Oh, you can afford it. Write this check. I'm an investment baker from England.
Here's a $40 million check. Thanks for my house.
Oh, it's just one week. We closed. Deal. Yeah, exactly.
Commission is $600,000. Yes.
No, that's why the car business reality shows never worked. Because if they actually meet car, guys. One, we cuss like a sailor. So, I mean, there's no way we can be on TV. So it's like we're off the mic. Like, we're just going at it. But dealing with regular people, we can't. And the fact that we do some hard decisions, like when you have to tell people, hey, look, I don't feel comfortable running you. I did it all the time. Like, hey, sir, your credit is garbage. You've never paid a bill ever in your life. I can't give you a car. I'm an asshole. I'm a jerk. I'm whatever else. But that's something you can't really put on camera. But I think the fact that now you can I was about to say probably now.
Yeah, with a little different now you can.
Because I'm thinking about opening up a dealership as well, because I see the economy turning. I know how over leveraged a lot of these dealers are. And every time I talk to some of these guys, I admit I know a lot, but I don't know at all. So I'm always learning for everybody. None of these guys want to learn.
They all think they know everything.
Yeah. I don't know if it's dealer syndrome or what, but it's like, we'll get into a room, and they always want to know how much money you're making, what are you selling? And then I'm, oh, this is what I did, and this is what I didn't. What about you? They never want to share any information, okay? And the worst thing is, in our realm, there's only so many exotic cars in Vegas, and we know who owns most of them. So when I see, oh, I bought this for this, I'm like, no, you didn't. That's consigned, bro. You don't own that car. You couldn't even afford that car. It's like they're just giving it to you on consignment to sell it.
And so that's the thing. I think, that you could break through in this particular market, because I don't.
Know if you know this lucky, but my first ever little business venture, I wrote a book called how to Avoid the Repo Man. I was 18, and I worked at a repo company here in town. It was one of my first jobs, and I wrote a book about how to understand the repo process, because not only people understood it, and I was thinking about going and getting that and basically republishing that book. It's short. It's I think it's like 40 or 50 pages. And I sold it in 2010 or eleven right around that time, like $5. And I was watching your video, and I was like, you know what? I should go out and re put this information out. Maybe I would do some good again. But then at the same time, I was like, why help the stupid if they wanted to go out and buy these ridiculous cars? BMW five series jack in the box manager guy why help them? Let them all learn a lesson. And then I'll go to the auction with you, and we'll buy 20 BMW five series for 50% on the dollar, and then we'll sell them to people who can then turn and forward them.
Because those guys that were not able to spend 20 over sticker, because the guys are working a jack in the box said, oh, I can afford $864 a month. Yeah, no problem, I'll take that car.
Yeah, I remember in my dealership, and I did a few videos on my channel where I talked about how I used to tell people, hey, you can't afford this car. You can't afford the maintenance, you can't afford the insurance. I wouldn't do it. The depreciation blah, blah, blah. I would give them reasons not to buy a car. And everyone thinks dealers are jerks and we're mean people, and a lot of that's not the case. Like, we tell people, you can't buy this car. You won't be able to buy a house because your dti is screwed up. Of course you have kids. You want to buy maybe a nice car for your wife. Well, that's screwed because you just buried yourself in this new BMW, and it's just like, no matter what we do, like you said, you can literally lead them to a path of financial freedom, and they will just stare in the face and be like, I want the BMW.
What's really funny is that those guys that did that, and they went all over sticker, anybody that can actually afford that payment, that wants to pay for that payment after, it's worth less. Cool. Be my guest. What I want to see is all the dealers that were taxing 50 mostly, just like Mercedes, BMW, Audi, those guys. Sure. All the other dealers, too, like kia, I heard was crazy.
Yes. 60 grand on a palisade.
Yeah, I heard that was wicked.
And so those are their customers, right?
They cannot now trade out of those cars to get new ones. Yeah, they're buried they're buried beyond belief. And so whose responsibility is it going to be?
I think now, listen, all these metrics, there's no way they're accurate because I know what the cars are selling for, but I think it only said, like, 26% of cars are underwater or paid for over sticker. It's got to be 70, 80%.
I bet you it was probably 90% of cars sold between June 2020 to current that were all sold over sticker. And if you go to trade those cars back in, they're going to be worth under sticker. Of course.
Plus, don't forget tax. You lose 10% right off the top. Any of the dealer fees and any of the insurances that you bought or any of the Gap or this or that, all those guys, they can't buy cars again. They're stuck.
They're buried for the next two, three.
Years, even two or three years, they're buried for four.
I mean, usually you get buried in your car for about three years before you can get your way out of it and break even. Now you added 30% overprice. It's going to take you an additional year and a half to get out of that. Because don't forget, they're not on five year loans. They're all seven year loans.
Yeah, I've seen some. Yeah, they were like, 84 months.
All of them?
They're all on seven year loan.
It blows my mind. And the worst thing was, we didn't see that not only with the new cars over msrp, we were seeing the subprime market, like, regular cars going for 170% of ltv. So these banks were like, okay, well, inflation, everything else, cars are going up. Go ahead and lend up to 170. So now on a $15,000 car, these guys are getting, like, 2023 grand, 24 grand.
And then it's like and now they're financing this car, and as soon as.
The market eight grand, 24 on it.
You know, it blows my mind. So it's like, it's just a recipe for disaster. So I'm very interested to see what's going to happen in the next six to eight months, because I think how people walked away from houses in oh eight. I think people are going to start walking away from cars.
Well, that's exactly what's going to happen. That's the key housing market is not going to crash like it did in oh eight. It's not possible. Yeah, all the the homes have been paid in cash. It's too hard to get a home loan these days. Nobody has five, six houses like they did. Yeah, but there's a lot of people that got four or five cars. I got 38 cars myself. I mean, luckily, all but two are paid for. I'm okay in all those cars, and I bought them.
But bring a trailer by my best friend recently out of those. I have a lot of collectible cars that are not the standard cars that we're talking about. I just sold my 1996 456 gt, which is a V twelve gated manual, ferrari Green on Tan. I mean, I purchased that car in the low 50s about a year ago, and I sold it for $72,000. So that was a modest increase. And I think if I would have sold it about six, seven months earlier, probably got 100, that would have been great. But I didn't want to sell it then. Now starting to sell through some of my stuff, my acura, nsx's, my Land over Defenders. Those types of cars, I believe, are not really affected by this dramatic drop because they're so rare. They don't have an mmr, number one, they don't have a lot of transactions. And so if you guys still want to be in the car business after all the things that I said no, and Lucky said no, if you're going to buy cars by very low production manual transmission cars or V Twelve. V Ten, very rare engine model cars. Because when everything is electric and everything is hybrid in the next couple of years, the most value you're going to have is in the stuff that people have emotion to.
So anything that's gated and anything that sounds like a V Twelve, that's my only advice.
And stick to those.
Yeah. I mean, I'm pretty much similar to the same thing. If you can afford those cars, go for it. If you're a new dealer or your rental car company, you're trying to start out, go the budget way, get regular economy.
Yeah, I'm talking about buying them and holding them. That's what I'm saying. I don't want you can't buy those and sell them immediately. You buy them and hold them, and that's an investment in the car world. Make your money somewhere else. You're not going to make money in the car business right now. If you're trying to become an automotive dealer, you better be a very popular person and you better have a long list of people that you can sell to organically. Because paying to get your customers is impossible these days. It's so expensive, very deep pockets, and there's not a huge reward at the end of the tunnel. That's why take my best advice and stay away. I don't care how big your dealer is, unless you have a new franchise store with the huge deep pockets of financing, all the extra warranties and all the extra stuff, you're not going to make money, right? Like the kia store will make money because there's a demand and there's manufacturer.
Rebates after we sell so many. I used same thing. Everyone thought that I was bawling, out of control. I added $2 million flooring line. You see 100 cars on my lot. Each car cost me $500,000 a month with my interest, interest and everything. So at the end of the day, people ask like, man, you must be rich, dude. I was walk away with like 150k after paying. My employees made more than I did. Yeah, everybody made more than I did. But Vegas, we had a really bad market and everything else. But I know it's getting hot in here. I want to finish off with one thing. We're talking about how car payments and everything are crazy. And I don't know if you're okay with discussing this. Could you tell us what a car payment is on some of your hypercars? Because I think people have no idea what it would take for someone to get financed. Even you with the background and credit and money, what did you have to put down? What did the monthly payments are? And some of the criteria you have to have to get something like this.
You can't go out and finance a hypercar. So in order to buy a koenigsegg, a Pagani, a bugatti, you have to pay cash for it. But I have a very good relationship with a private bank that I was able to take 50% of the value on that car back because I wanted to open more chicken restaurants.
And so yes, I have money. But I also want to have your.
Capital work for you.
I'm holding more cash now than I ever have before. I used to have, like, 200 grand in my bank account. I'm sorry that that sounds pretentious, because I'm not trying to be that way, but when you're operating a business that has a $430,000 overhead every month, having a couple of hundred thousand dollars is very, very little of cash.
And now I have upwards of ten multiples of that.
I mean, way more. Because I see the economy is changing and I want to have that opportunity to be able to buy in those good deals and get them real quick and have the cash ready. So I took a loan on the pagani and the koenigs egg. My bugatti did not? Because I don't know that car doesn't have the value the other ones do.
The value on the konigsegg is close to 5 million.
It's a mid force. And the value of the Pagani is about two six to seven. So I took 50% on both of those cars through a private bank. I pay 35,000 for the konigsegg and about 20,000 for the pagani. But those aren't standard car payments, right? So I don't want to confuse anybody with those.
I want to give people an instinct, because everyone was like, wow, I want to have these cars in my driveway. And I don't think they realize how expensive.
Well, my insurance is $12,000 a month.
Yeah. And $12,000 a month on top of that. These cars are sitting here. You don't rent them.
Correct. Never, ever would it be a rental, let alone people. I don't even let me sit in them. Yeah, that's the thing. That's why I don't even want this business. Because I don't want people to assume that all my hard work from all the other things that I do outside of royalty is because I rent my cars. Like that's why I want to keep them in my house. But then I feel bad because people fly from all over the world to come see these cars, and I'm like.
Like I'm never going to see it. Yeah.
I'll leave them in the showroom just because I want to be nice and I want people to take pictures with them. And I do. That kind of like a momentum for people that are traveling here. But I didn't finance those cars because I didn't have the money. That's the difference.
Like when I go to buy a car. If you can't write a check for it, you probably shouldn't own it. You should make that money work for you better. There's a lot of people that will tell you, look, take the 300 grand, buy a rental house. It'll give you the rental amount of money per month to go finance the land. Like, the house will make more money and you can just lease the lambo.
I can totally tell you been hanging on Ryan and Graham.
Yeah, well, exactly. But I mean, I share so much common interest with them, and honestly, I started holding more cash. Talking to Graham, graham really opened my eyes to maybe saying, look, you're a little too heavy in these things. And I was like, man, maybe you're right. And it really feels good to have the ability to just write a check for everything on the spot and not have to sell something to pay for something. I used to have a lot more than 38 cars and big cars. Like, really big.
I know you had a warehouse right behind us. It was full of full of cars. You only see this, like, small sliver here, but you got a whole warehouse not even open to the public over there.
And so now that I've taken my money back on those and look, those cars, in my mind are tokens of my success. And I want to look at them every day, and I really, really like them. They're amazing to just to be around. But I didn't make that money from royalty. Royalty doesn't make money to pay for that kind of stuff. I mean, if I got a company, BMW Seven Series, I'd be lucky. So it's the chicken business, and it's the dramatic amount of restaurants that you can have. Every restaurant that I have makes a little over $50,000 to $60,000 a month, net. Some of them are making 90.
With alcohol. So when you think about that, if I have ten restaurants, I mean, that's bringing in net profits, five, $600,000 a month.
You know, so for me to pay 50 grand a month for my cars isn't that big of a deal, because that money that I use to loan against them is making me that much money. So one store for 5000, $600,000 can net 50,000 a month in my pocket.
So if I just do ten stores, it's $500,000. That's one koenigsegg. So, yeah, I do want those cars, but at the end of the day, I want the assets of the business more, because that business will turn into 100 X, 200 X or 250 X of its value over a three, four year period if I scale it big enough.
And then I'll get that big nine figure paycheck, and then we'll have a different type of podcast, actually.
Yeah, exactly. By that time, it'd be completely different.
It'll be a different podcast. I'll have gold mics.
I appreciate you taking the time. I know we literally did this. I walked in to say, hi, I picked up a vehicle from you, and then we're like, you got 20 minutes. You want to do a podcast or you do a quick thing. And here we are. But if you have any questions, leave in the comments section below. I'll try to answer most of them as I can. If you have anything for Houston, leave it on his channel. Make sure you subscribe to him also.
Mine'S. Lucky Lopez is yours under your name now.
Yeah. Houston crosstal.
So make sure you subscribe to both of us also Instagram and anything you want to close it out with.
Honestly, guys, thanks for watching. This is the hottest podcast I've ever done. It's about 160 degrees.
Right now it's pretty low. I appreciate it if you could like this video to maybe be our most liked video. So I could walk outside and get some fresh air.
That'D be great. Exactly. We got to go get some hot chicken and some beer at your own place.
I'm going to go get some water. Okay.