ADDED THE CALL: Mr. Painter, TEAR DOWN THIS WALL!

I was challenged by Grant Cardone via Facebook about a few things to do with my stance on TrueCar, one of the challenges being whether I had reached out to TrueCar about my concerns. I had not—but I thought about it, and so I did! I emailed TrueCar's CEO Scott Painter via LinkedIn “InMail”, though I’m not sure he’ll get it or respond if he does.

I reproduce the email, then, below as an open letter on this forum from me to Scott Painter, CEO of TrueCar (I did make a few VERY minor changes in this letter from the email for clarity and grammar). I was limited in the number of characters I could type, so I tried to focus on connecting for further dialog, though I did manage to bring up my real concerns. However, considering the volatility of this topic, I have concluded that he and his company are building a wall between dealers and vendors, between dealers and vendors, between dealers and consumers, and really between a future with dealers making a profit and a future with only TrueCar making a profit.

Mr. Painter, you talk in a video about truth and transparency. Well, President Ronald Reagan, during a speech he gave while standing in Berlin at the Brandenburg gate near the Berlin Wall in June of 1987, famously challenged Soviet leader Gorbachev to open up East Germany. Paraphrasing what Reagan said that day:

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“Mr. Painter, Tear Down This Wall!”

-----------LinkedIn InMail 12/9 and Open Letter to TrueCar CEO Scott Painter----------.

Mr. Painter,

I'm one of your vocal critics in the automotive vertical, mostly because of your stance against the dealer distribution channel, but also because it is unclear whether you are mining sales data directly from dealers' DMS or perhaps through transactional sales data from several of the parties involved in the dealers' data. By definition, it seems what the dealers report is being used by TrueCar, and that also seems a repurposing of dealers' sales data against them in the marketplace.

I have watched all the videos I can find, including the one from TechCrunch50 in 2008 where you were very clear about what appears a very anti-dealer agenda. I realize you have passionate beliefs, but I have both a tech background as well as dealership experience. If you regard www.dealerelite.net, a social media site membered by thousands of automotive vertical professionals and lurked by thousands more, you will see a thread by Jim Ziegler that has nearly 18,000 page views--a record for auto professional social media. Your employees, Charles Kim and Devin LaCrosse, have only recently been posting on another large thread on the site www.automotivedigitalmarketing.com, and in my opinion it hasn't gone well for TrueCar. I realize better than most what $200million in funding, heading towards IPO, effort can mean.

After all that intro, which I thought was necessary, my question is simple: Can you instead participate in the marketplace with dealers and find a way to work with dealers so that they evolve into the new markets rather than get threatened with what amounts to sounding like a coming extinction event?

I realize we may never speak in person, and that you may never even read this. However, I was asked by a prominent person that I know if I had reached out to you--and, after thinking about it, I know that **I** want to modernize the experience. If I could get some time to speak to you, I would only want to try and convince you that there's money to be made by modernizing those dealers that WILL modernize.

Hope to hear from you soon.

Keith

-----------------------------------------

P.S. UPDATE VIDEO 12/16:

Scott Painter agreed to the recording of the call. Interesting at 12min or so and also at the wrap 48min0sec. Scott Painter said he does not now, and has never, dipped into the DMS to support his pricing curve. I said the dealer sold the car, so the dealer is the source of his "sales data" to drive his portal, regardless--and that he was repurposing that data plus all the other date he gets his hands on against the dealer. He said he was giving dealers a great closing tool; I said his $1.5BILLION consumer "savings" included LOST dealer profit. He said his bell curve pricing was fair; I said, since he forces dealers to price a certain way and NOT set their own price (they have to choose a spot called "Good" or "Great") that he is inevitably on a race to the bottom just like Jackson of AutoNation said. He said he doesn't hate dealers; I reminded him of what he said differently at TechCrunch50 in 2008 (and he said he regrets saying that). He said he also regrets saying that cars a commodities. He said TrueCar is just business and good for dealers; I used the hypothetical example ofwww.TrueCEOSalary.com to tell him it was bad for dealers and personal (48min0sec). And that is the overall mistake he has made, in my opinion.

And the future is, despite his dancing a bit (in my opinion), www.TrueFinance.com, www.TrueGAP.com,www.TrueServiceContract.com. It's ALREADY www.TrueUsedCarPrice.com, oops I mean www.ClearBook.com.

So, if you don't want to see your industry go the way of travel booking sales and travel agents, KILL THE BEAST!

My opinion. You listen, and you judge.

Thanks!

Keith

keithshetterly@gmail.com, www.keithshetterly.com

This is All Opinion--I could be wrong. eMail me if you think I'm wrong, but regardless do what YOU think is best for your business!

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Comment by Stanley Esposito on December 20, 2011 at 2:59pm: He is like a criminal who regrets getting caught not committing the crime?

Comment by Keith Shetterly on December 20, 2011 at 2:54pm: Thanks Stanley! Didn't you hear? He "regrets" some of the things he's said . . . I wonder if that's because he feels bad or because it caused a social media movement he didn't expect on the way to his billion-dollar IPO? ;)

Thanks Randy! I saw that earlier, VERY interesting!

Comment by Stanley Esposito on December 20, 2011 at 2:52pm: Keith, great job! Mr Painter said nothing to change my mind. I wonder how many salespeople Scott has spoken to?

Oh yea he wants them eliminated...

Comment by Randy Fry on December 20, 2011 at 2:02pm: Great News in the State of Wisconsin...

The Wisconsin Department of Transportation, Division of Motor Vehicles has sent a letter, dated December 14, to TrueCar informing them that their business model violates Wisconsin law. The department instructed TrueCar to inform all of the Wisconsin dealers participating in TrueCar?s program that the program is not in compliance with Wisconsin law and either discontinue operations in Wisconsin or change their program. The department identified the method of payment (the $299-$399 per sale) as an illegal commission and a bird dog fee.

Comment by Keith Shetterly on December 16, 2011 at 4:39pm: Interesting at 12min or so and also at the wrap 48min0sec. Scott Painter said he does not now, and has never, dipped into the DMS to support his pricing curve. I said the dealer sold the car, so the dealer is the source of his "sales data" to drive his portal, regardless--and that he was repurposing that data against the dealer. He said he was giving dealers a great closing tool; I said his $1.5BILLION consumer "savings" included LOST dealer profit. He said his bell curve pricing was fair; I said, since he forces dealers to price a certain way and NOT set their own price (they have to choose a spot called "Good" or "Great") and that he is inevitably on a race to the bottom just like Jackson of AutoNation said. He said he doesn't hate dealers; I reminded him of what he said differently at TechCrunch50 in 2008 (and he said he regrets saying that). He said he also regrets saying that cars a commodities. He said it was business and good for dealers; I used the hypothetical example ofwww.TrueCEOSalary.com to tell him it was bad for dealers and personal (48min0sec). And that was the overall mistake he has made, in my opinion.

So, if you don't want to see your industry go the way of travel booking sales and travel agents, KILL THE BEAST!

My opinion. You listen, and you judge.

Thanks!

Keith

Comment by James A. Ziegler on December 16, 2011 at 3:17pm: Okay Honda has taken a courageous stand and banned TrueCar pricing with it's dealers. I know for a fact VW is strongly considering doing the same. I hope VW realizes that they've just began to get some incredible momentum in the market AND now is NOT the time to allow an invader like truecar to devalue the brand in the public's eyes. No matter what you sell, TrueCar cheapens your brand.

Group 1 made sure their dealers cancelled after looking at the exposure of having these people rooting around in their DMS, especially with AutoNation's CEO on the board of Truecar...

Group 1 was smart enough to see the writing on the wall and run as from away from these people as possible. When is Asbury, Penske, Sonic and others going to awaken and realize they people appear to be a huge threat? Even large private groups like Rick Hendrick should be looking at the evident danger we're all perceiving here.

Where are Ford, General Motors and especially...where is Toyota in this escalating skirmish? I am embarrassed that mark Reuss, president of general motors would actually go to TrueCar Headquarters and play with Painter showing him a 750HP Camaro.

I did not mention Nissan because their dealers are using Truecar to sell way below invoice so they can collect stair step money. You guys are smiling now BUT if Nissan takes away the program, you're screwed royally because of the benchmarks you set with TrueCar making your brand image "Ultra Cheap Nissan"

Does Mark Reuss NOT understand that his dealers are being raided by these people cheapening the product down to unprofitable and below? I find it hard to believe that Reuss would publicly suck up to these people if he truly understood.

There are a few investigations of TrueCar popping up here and there AND we're still urging dealers to put more emphasis with your dealer associations to get off of the sidelines and represent us... I know a couple of associations are doing their best while others limped off of the battlefield without firing a shot... weak.

I am especially disturbed about Toyota staying quiet while Honda takes a stand. It's like sending a message that Toyota has less value.

This thing will gather increasing momentum and I predict TrueCar will find some high-profile weak suck who will sellout their integrity for the publicity or hard cash and take a stand publicly backing them and betraying dealers.

Of course, this is all a lot of conjecture, speculation, supposition and opinion...I might be wrong. :)

Comment by James A. Ziegler on December 15, 2011 at 8:55am: Group 1 booting TrueCar, This is only the beginning, I predict in the next few days we will see several of A-Tier manufacturers, import and domestic, following the VW example and booting TrueCar ... next watch and see the relationship with USAA and AMEX deteriorate as consumer complaints stack up with the better business bureaus and government regulators possibly taking a deep look. Look for investors to run for cover as this deal turns sour. Just my opinion of course, I might be wrong...Let's see.

Comment by Keith Shetterly on December 14, 2011 at 10:07pm: I come here on this blog to alert you to this conversation via comments on ADM - TrueCar has offered to talk to me, and I have asked that the conversation between myself and Scott Painter be pumped live for listening to as many as possible! I'll let you know whatever arrangements are made.

Here's the exchange for reference, start from the bottom.

Comment by Keith Shetterly just now

Chintan, I guarantee you that I will have listened to, re-listened, read, and re-read every word available by the time any call occurs. It's no problem about the timing; it's the holidays! Thank you, and we'll work it out.

Keith

Comment by Chintan Talati 5 minutes ago

Hi Keith,

No problem. I'm happy to listen to your proposal. And hopefully, you've had a chance to review some of Scott's comments on our blog with the open letter. These have come directly from him. I'll be on a plane tomorrow in the afternoon but will be available before and after that. I just want to be open with you in case it takes more than a few hours to hear back from me.

Thanks,

Chintan

Comment by Keith Shetterly just now

Chinton, I found your email in my SPAM folder from yesterday about 8:30pm my time (Central),a and I will reply to that. I don't have a voicemail from you, and I don't have a direct message on Twitter (see below, though I obscured others enough for their privacy but still to identify they aren't you). I'll answer your email, and I appreciate very much your effort to contact. I think your resume, which includes Edmunds up to 2010, is a unique qualification for your PR work here, and we'll see what we can work out.

Personally, for that transparency that gets talked about, I would prefer that we talk with an audience of my peers (if they want to listen in on a 1:1 conversation) listening. I might be able to arrange, or perhaps you can with your larger budget, a GotoMeeting between myself and Mr. Painter that could have some attendees from these boards on listen only? I realize there might be a short conversation we could have for introduction ahead of that, but these issues sit amid st an uncertain future for dealers everywhere who would like to modernize without general catastrophe.

So, I'll email you this proposal. I believe that you have tried to contact me since yesterday, and I appreciate the time you've taken for that.

Thanks,

Keith

Comment by Chintan Talati 42 minutes ago

Hi Keith,

Thank you for your note. Scott Painter would be more than happy to contact you. I've reached out to you via e-mail, phone call and twitter over the last few days. Feel free to reach back out to me and we can set something up within the next few days.

Thanks,

Chintan Talati

TrueCar

Comment by James A. Ziegler on December 13, 2011 at 12:34pm: The Devil Made a Call to Georgia

by Joshua Hirsch

The Devil made a call to Georgia, he was looking for a industry to steal.

He was in a bind because of the forums chatter and was looking to make a deal.

When he came across a young man selling cars, and selling them HOT, then the Devil jumped on his speaker phone and said boy let me tell you what !! I guess you did not know it but I am a car guy too, and if you care to take a dare id make a bet with you.

Now you sell cars good son, but give the devil his due. I bet my business, against your industry because I think I’m better then you. The boy said my name is Jimmy and it may be a sin, but I take your bet your goanna regret cause I am the best there has ever been !! FIRE ON THE MOUNTAIN, RUN BOYS RUN !!!

Comment by Keith Shetterly on December 10, 2011 at 2:17pm: Stanley, I don't expect Painter to reply. Or to change. Really, this was the result of disagreeing with Grant, and so I took the step he suggested.