Pandemic Keeping Holiday Travel to Lowest Levels in Two Decades

First Up 05/22/20

As Virus Raged, China Snapped Up Luxury Cars Made in America

A raging pandemic, lockdowns and continued trade tensions didn’t curb China’s enthusiasm for some U.S.-built luxury cars, reports Bloomberg. Alabama’s auto exports to China in the first quarter of 2020 soared more than 170% from a year ago, Greg Canfield, the state’s secretary of commerce, said in an interview. Three foreign automakers — Honda, Hyundai, and Daimler Mercedes-Benz — operate assembly plants in the state, which hasn’t yet broken down the Chinese exports for each company.  Together they produce about a million vehicles a year in Alabama for domestic sales and export, Canfield said. “By far our largest exporter on the automobile side comes from Mercedes,” he said. The Alabama Mercedes plant is the exclusive worldwide manufacturer for some of its most popular sport-utility vehicles, including the GLE and GLS, which sell at base prices of more than $50,000 in the U.S.  Alabama’s overall exports to China grew 45% to $534 million in the first quarter over the year earlier, according to U.S. Census Bureau data. Read more here. 

Ford Throws Lifeline to Suppliers Facing Cash Crunch

Ford Motor Co. is helping some of its suppliers survive a cash crunch by paying its bills early to ensure that critically needed parts keep flowing to its auto factories, reports Automotive News. The Detroit 3 are restarting production after shutting down for two months to slow the spread of the coronavirus. That has caused a cash-flow crisis at many suppliers that don’t have deep capital reserves. Ford burned through $8 billion in the first three months of the year, but it has built up a substantial cash pile by suspending its dividend, drawing down its credit lines, and selling junk bonds. Now it is helping keep key component suppliers afloat by paying invoices early. “In light of current market conditions, Ford is creating an early-payment program for our supply base,” Jennifer Flake, a company spokeswoman, said in an emailed statement. “This new voluntary program creates access to cash flow and working capital to Ford suppliers.” Read more here. 

The Coronavirus Pandemic Has Upended Auto Sales and Buying a Car Will Never Be the Same

Pickup, delivery, or curbside? It’s a question Americans have grown accustomed to answering for food delivery and groceries during the coronavirus pandemic. It also might be something they’re asked when purchasing their next vehicle, reports CNBC. The Covid-19 crisis has upended auto sales, and many don’t think they will ever be the same again. Dealers and automakers are changing business strategies and investing millions in new digital sales tools as consumers demand more online and personalized services. “For digital, this whole disruptive period with corona is an inflection point from which there’s no turning back,” Mike Jackson, chairman and CEO of AutoNation, the country’s largest auto retailer, recently told investors. What that means for consumers is being able to choose how much or how little of the process they want to conduct online. That includes scheduling a test drive or delivery of a vehicle to appraising a trade-in and getting prequalified for financing. Read more here. 

Pandemic Keeping Holiday Travel to Lowest Levels in Two Decades

The long Memorial Day holiday is typically one of the biggest travel weekends in the U.S. each year; however, due to the COVID-19 pandemic traffic is expected to be down 64%, reports The Detroit Bureau. Of the millions that do plan to head out, a new study shows that 75% will travel to their final destination by car, truck, minivan or sport-utility vehicle. Their trips are likely to be shorter to account for local safety guidelines, according to a new survey by Gas prices are at $1.87 per gallon, the first time they’ve been below $2 per gallon since 2003. The majority of traveling consumers, approximately 75%, plan to drive 100 miles or less and will be away for a day trip. The number drops to 57% for overnight trips. Many plan to visit family or friends (43%), but as more beaches and recreation areas begin to safely open, 27% of Americans plan to hit the beach, 22% will go to state or national parks and 21% plan to enjoy a weekend of camping. Read more here. 

Michigan Auto Dealers Eager to Reopen Showrooms Tuesday

Michigan auto dealerships will be allowed to reopen their showroom doors Tuesday by appointment after shutting them nearly two months ago at the start of the state's battle with the coronavirus, reports The Detroit News. Gov. Gretchen Whitmer signed an executive order Thursday allowing dealerships and retail businesses to reopen to all customers by appointment only. Jim Seavitt, owner of Village Ford in Dearborn, is ready to reopen his showroom. The dealership has been working with customers in the parking lot, which isn’t comfortable in the rain and the cold weather. “If you follow the rules, it should help business in Detroit,” he said, noting that he’s installed plastic screens to separate sales people at their desks and has a supply of masks and disinfectant ready to go. Seavitt has still able to sell 120 new vehicles so far in May, but most of those have been lease trade-ins. The demand, he says, is there. Read more here. 

Webinar: Sanitization and Decontamination Processes to Reduce Virus Risk

Join AIADA's next AutoTalk webinar to learn about vehicle santization and decontamination. Dr. Rik Patel is a physician who has spent 11 years in sports medicine and orthopedic care. He is co-founder and chief operating officer of RideKleen, a mobile vehicle care and fleet services.

Hear his take on vehicle sanitization and decontamination, safely restarting various modes of transportation and shared mobility and sustainable vehicle hygiene. Dr. Patel will discuss:

  • The importance of vehicle sanitization & disinfection for your workers and customers

  • FACTS and MYTHS regarding disinfection

  • How do evaluate disinfection products in markets and what to look for? Are they safe?

  • Why process matters in vehicle disinfection and things to consider

When: May 27, 2020 at 2 p.m. EDT 

Click here to register. 

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Ferrari's On-Again, Off-again Love Affair with the Indianapolis 500 [MotorAuthority]