PPP Loan Window is Closing, with $134B Still on Offer
The application window for Paycheck Protection Program loans closes Tuesday with about $134 billion in funds available as of Monday evening, reports The Wall Street Journal. That surplus has triggered a new debate over what to do with the remaining funds, as fears mount that the economic fallout from the Covid-19 crisis is far from over. Senate Democrats have proposed legislation that would allow small businesses to take out a second PPP loan if they have 100 or fewer employees. Previously the program was generally open to companies with 500 or fewer workers. Aides for Sen. Marco Rubio (R., Fla.), chairman of the small-business committee, said a bipartisan task force is currently working toward consensus on a final agreement to implement the next step to support small businesses. Read more here. For updated PPP guidance from the SBA, click here.
Toyota Retains Most Valuable Auto Brand Title; Tesla Passes Honda, Ford, and Nissan
Toyota has once again been named the world’s most valuable car brand while Tesla moved up three spots to fourth place, passing Honda, Ford, and Nissan. Automotive News reports that Tesla’s 22 percent valuation increase to $11.35 billion also nearly gave it a place on the 2020 BrandZ Top 100 Most Valuable Brands list, which is calculated by market researcher Kantar. Three automakers did make the ranking of the world’s 100 Most Valuable Brands, led by Toyota, valued at $28.39 billion, at No. 48. Mercedes-Benz placed 56th and BMW 61th. Ford and Honda dropped off the top 100 list in 2018. With the exception of Tesla, all brands in the automaker top 10 lost value. This was partly because of waning consumer enthusiasm, Global BrandZ Strategy Director Graham Staplehurst told Automotive News Europe. Read more here.
Automakers Rev Up Discounts to Beat Coronavirus Sales Blues
U.S. automakers are scheduled to report June and second-quarter car and light truck sales on Wednesday, reports Reuters. Analysts are forecasting June sales will fall by 25% from a year earlier. That’s an improvement from the declines in April and May, reflecting a slow recovery in retail demand hit by coronavirus shutdowns. The second-quarter numbers reflect a peak for the U.S. auto industry’s efforts to use consumer discounts, low interest loans and other incentives to prop up demand during the pandemic. Since March, U.S. automakers have rushed to prop up demand with rich incentives to keep sales moving. The deals have been good enough and over the next few months, industry officials and analysts say sales could be hurt because of tight inventory. Read more here.
Supreme Court Rules Structure of CFPB is Unconstitutional
The Supreme Court ruled Monday the structure of the Consumer Financial Protection Bureau (CFPB), a consumer watchdog that was the brainchild of Democratic Senator Elizabeth Warren, is unconstitutional, but stopped short of dismantling the agency, reports CBS News. Writing for the majority, Chief Justice John Roberts wrote "the structure of the CFPB violates the separation of powers." He went on: "The agency may therefore continue to operate, but its director, in light of our decision, must be removable by the president at will," Roberts wrote for the 5-4 court. The court ruled along ideological lines that the structure of the CFPB violates the Constitution. The high court also found by a vote of 7-2 that the provision of the law dictating the director's removal can be struck down without invalidating the entirety of the Dodd-Frank Wall Street Reform and Consumer Protection Act, which established the consumer agency. Read more here.
Organizers Scrub 2021 Geneva Motor Show
The Detroit Bureau reports that there will be no Geneva International Motor Show next year, with organizers pointing to concerns that the coronavirus pandemic could drag on into 2021. The annual Swiss gathering was the first car show of the year to be canceled due to the eruption of the coronavirus pandemic, though other major events, including those in New York, Detroit, and Paris have since been scrubbed, with industry officials questioning when such shows will be able to safely take place again. “It is far from certain that the current health situation would permit the organization of an event attracting more than 600’000 visitors and 10,000 journalists next spring,” organizers of what is formally known as the Salon International de l’Automobile said in an e-mailed statement. As a result, “A majority of GIMS exhibitors who took part in a survey, stated that they would probably not participate in a 2021 edition.” The Geneva show was the first to be directly impacted by the pandemic, Swiss officials ordering it canceled just days before it was set to hold its two-day media preview during the first week of March. Read more here.
Webinar: An Update on COVID-19's Impact on U.S. Auto Sales
Cox Automotive Senior Economist Charlie Chesbrough returns to AutoTalk for an update on July 9 at 2:00 p.m. EDT. Topics to be reviewed include:
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Economic forecast and impact going into the third 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 price
Around the Web
100th Anniversary 2020 Mazda MX-5 Miata Announced for Sale in the U.S. [Autoblog]
Woodward Dream Cruise Canceled Over COVID-19 Concerns [The Detroit News]
The Greatest Cars of All Time: The Sixties [Car and Driver]
Consumer Reports Lists the Cars Most Likely to Blow a Head Gasket [Autoblog]
