Beltway Talk: AIADA Chairman Jason Courter on Selling Cars Amidst a Pandemic
In this episode of Beltway Talk, Washington state Honda dealer and AIADA Chairman Jason Courter discusses what it’s like operating a dealership at ground zero for COVID-19 in the United States. Listen to find out how he is tackling new restrictions on his stores, protecting his employees and customers, and keeping AIADA focused on its core mission in Washington, D.C. Listen in and subscribe here.
Showrooms Vandalized During Protests; Dealer Says 'It Was Really Horrible'
Over the weekend, several dealerships on the West Coast and elsewhere were vandalized during protests stemming from the death of George Floyd last week in Minneapolis, reports Automotive News. On Monday, dealerships in the hot zones were cleaning up and preparing for additional disruptions ahead. Nick Pacifico, vice president of the Rickenbaugh Automotive Group in Denver, said Monday that one of its downtown locations would move all of its nearly 360 vehicles indoors for the second night in a row to shield the inventory from riots. Mercedes-Benz of Oakland, in California, is one of the dealerships that was looted. Photos show broken showroom windows and vehicles that had been smashed and spray-painted with words such as "eat the rich." CBS BayArea reported that the store also had severe smoke damage from fires in the area. On Saturday, the dealership posted a video on Facebook of its cleanup effort and said, "Our family is rebuilding. We are part of the community. #protectoakland." Read more here.
U.S. Economy Faces Projected 10-Year Recovery From Coronavirus Effects
The U.S. economy could take the better part of a decade to fully recover from the coronavirus pandemic and related shutdowns, a U.S. budget agency said, as a series of surveys pointed to continuing weakness in global manufacturing, reports The Wall Street Journal. The Congressional Budget Office, a nonpartisan legislative agency, said the sharp contraction triggered by the coronavirus caused it to mark down its 2020-30 forecast for U.S. economic output by a cumulative $7.9 trillion, or 3% of gross domestic product, relative to its January projections. GDP isn’t expected to catch up to the previously forecast level until the fourth quarter of 2029, the CBO added. The roughly $3.3 trillion in stimulus programs enacted by Congress since March will only “partially mitigate the deterioration in economic conditions,” the CBO said. The CBO analysis came as new surveys showed that factories in the U.S. and abroad continued to reduce output and shed jobs in May, though the pace of deterioration moderated as governments moved to ease coronavirus-related restrictions on their economies. Read more here.
Honda Producing 130,000 Face Shields for Pandemic First Responders
The coronavirus pandemic caught the country unprepared, doctors, nurses, and other first responders struggling to find necessary supplies of masks, ventilators, and other critical gear. To help address that shortage, a number of automakers stepped up, converting some of their production space to boost production capacity for needed equipment. According to The Detroit Bureau, that includes Honda, which teamed up operations in the U.S. and Canada to start rolling out face shields at a rapid clip. So far, the company said, it has delivered more than 70,000 of them to medical facilities in 45 states, Honda planning to produce and deliver another 60,000 “in the coming days,” according to a company statement. “Team Honda has really stepped up to the challenge on a tight timeframe,” said Hugo Beltran, associate chief engineer at Honda Engineering North America, or EGA. “We make a car about every 50 seconds, and that’s the same type of approach that we’re taking for these face shields. We’re using our mass production expertise and equipment to produce a large quantity of shields to help people in our communities.” Read more here.
COVID-19 Clears Out Toyota's Texas Headquarters
Up until the middle of March, the gleaming new headquarters of Toyota Motor North America in Plano, TX, housed more than 4,000 employees. Now, amid the COVID-19 pandemic, the number of employees working at the Plano campus is likely to be significantly less as the automaker adapts to wider use of working remotely, reports WardsAuto. Once the stay-at-home orders spurred by the pandemic were put in place in the middle of March, the number of employees in the Plano headquarters dropped to about 60. As Toyota begins ramping up production, the number of employees who have returned to work at the sprawling campus has increased to about 200. “There are some things you can’t do remotely,” says Christopher Reynolds, TMNA’s chief administrative officer, who notes the returned employees work in a lab used to check the quality of various components. But for the most part, Toyota employees will continue to work remotely and there is no timetable for bringing them back to the Plano campus, Reynolds says. The experience during the pandemic has shown employees can work effectively and efficiently from remote locations, he says. Read more here.
Used-Car Market Could Be In for a Wild Ride
Wholesale used-vehicle prices continue to recover from steep lows during the early days of the coronavirus pandemic. But a bumpy road lies ahead, reports Automotive News. Used cars and trucks are still expected to head to auctions en masse from rental car companies de-fleeting amid a general lack of travelers. Repossessions also are picking up, and many leased vehicles with turn-back dates deferred because of the crisis are bound to come to the wholesale market, too. "We really haven't dealt with the supply that's out there yet," said Tom Kontos, chief economist at KAR Global, which owns auction giant ADESA. The likely influx of vehicles, coupled with economic uncertainty, is why industry observers foresee a period of volatility this summer and fall. While the rebound in retail sales already happening should help offset the disruption, uncertainty abounds. Many millions of Americans are still out of work, and increased unemployment benefits put in place because of the pandemic are set to end in July. Read more here.
AutoTalk Webinar: An Update on COVID-19's Impact on U.S. Auto Sales
Cox Automotive Senior Economist Charlie Chesbrough will return to AutoTalk on Thursday, June 4 at 2:00 p.m. EDT for an update. Topics to be reviewed include:
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Economic forecast and impact going into the second quarter
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Consumer sentiment and buying behaviors
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Stock market, interest rates, and employment
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An outlook for vehicle sales
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Current view of new and used retail sales and prices
Around the Web
Weird Cars of the 1990s: The Good, the Bad, the Utterly Forgettable [MotorTrend]
2021 Toyota Corolla Hatchback Gets New Features and a Sharp Special Edition [Autoblog]
Cities Bid for Tesla Truck Plant Despite Shrinking Coffers [Bloomberg]
Argo AI, Volkswagen AG Close $2.6B Autonomous Vehicle Tech Deal [The Detroit News]
