Episode 17 | August 28, 2018
Sustainability, Community, and the Future of Cars.
This week we welcomed to the studio Will Hardeman of Continental Auto Group, which runs the First Texas Honda, Austin Subaru, Mercedes-Benz of Austin, and Austin INFINITI car dealerships. Will chats with hosts Kyle Frazier and Sherren Harter about growing up in the family business, how the company approaches sustainability and community involvement including solar power and water conservation, and his perspective about big-picture trends in the automotive industry including electric cars such as Tesla and self-driving cars.
In the 1970s, when the number one selling car in the U.S. was the Oldsmobile Cutlass, an Austin entrepreneur named Bryan Hardeman purchased a struggling imported car dealership that was selling ten to fifteen cars a month combined under the Honda, Stirling, Volkswagen, and Mercedes brands. Today, Will and his sister Lisa work side-by-side in the family business, which includes four of Central Texas’ largest and most prestigious car dealerships selling hundreds of cars per week, as well as leasing and insurance companies.
The Business Case and Customer Support for Sustainability
Continental is a sustainability leader both at a group level and with initiatives at individual dealerships. Will explains their overall philosophy as thinking about “how to be more efficient and how to use less resources in the first place.” He cites three examples:
1. Smart thermostats to reduce energy
2. Recycling car wash water to reduce water usage by 80%
3. Moving away from air conditioning in service centers towards a combination of Big Ass Fans and swamp coolers
Austin Subaru has taken many steps to reduce their environmental footprint. Most recently, they installed a 240-kilowatt commercial solar panel array on the showroom rooftop that will offset more than half of their electricity use.
Will explains, “the business case is finally there, and we’re really investing in the future. We own the building and we know what that’s going to look like in 10, 20, 30 years as far as our costs instead of leaving it to the energy utility.”
Other initiatives started by their volunteer employee green team include:
First Texas Honda
The First Texas Honda dealership moved into its current location on Steck Avenue in north central Austin in 2012, becoming the largest Honda dealership in the United States. Green features of the new building include:
“We base a lot of our energy and resource usage decisions on the economics, and if it makes good business sense we do it,” says Will. That said, being environmentally friendly “resonates with our customers. They choose to do business with us because of it.”
Will explains the Continental Auto Group credo simply: “To sum it up, we support the community that supports us.”
What the Future of Cars May Bring
There are several macro trends that will affect the car industry in the future and have a sustainability component.
Alternative Fuels: Electric and Hybrid Electric Cars
The question about what type of energy will power our cars in the future is still open. Although the number of Tesla cars on the road will likely remain small, the company has proven to all manufacturers that there is consumer demand for all-electric vehicles. That said, hybrid electric cars will remain more mainstream in the short-term because range anxiety still exists for most drivers. Will believes that “mobility is on the rise in our society. It will become more ubiquitous albeit more efficient per mile traveled.”
Autonomous Vehicles: Self Driving Cars
Self-driving cars will eventually enable us to commute more efficiently, largely eliminating traffic problems. Imagine, says Will, “rush-hour traffic that can travel at 80mph rather than bumper-to-bumper stop.” Removing the driver entirely from the car is a big, long-term change that will require progress along both technological and regulatory fronts. A partially autonomous interim solution could be a car that is self-driving on the highway but driver-controlled on city streets and in parking lots.
Car ownership models: Service, Ownership, Hybrid
Pay-for-service fleets start to make sense when cars are fully autonomous, which could satisfy consumers’ need for mobility while reducing the total number of cars on the road. Cars are largely unutilized – and therefore inefficient – assets. With sufficiently advanced technology, it is possible to imagine a future of fewer cars while maintaining or even improving convenience for drivers.
“There are a lot of hurdles to work out” related to each of these trends, but Will suggests that “it’s not a question of if but when.”
Meanwhile, with tariffs coming and steel prices going up, now is a good time to buy if you’re thinking about purchasing a new car. “They’re not going to get any cheaper than they are today.”
Are we following each other yet?