By Gina Reuscher

5 GROUPS IN THE AUTO INDUSTRY PLEA WITH TRUMP

TO CONSIDER DEALERSHIP SALES AN ESSENTIAL BUSINESS

UPDATE 3/26: the White House and Congress struck a deal for a $2 trillion government aid package to individuals and businesses of all sizes. It's the largest stimulus in American history, dwarfing even the $700 billion Troubled Asset Relief Program used during the 2008 financial crisis.


The plan includes about $500 billion that can be used to back loans and assistance to companies, including $50 billion for loans to U.S. airlines, as well as state and local governments. It also has more than $350 billion to aid small businesses. Then there is $150 billion for hospitals and other health-care providers for equipment and supplies. The auto industry continues to wait for the specific terms of a trillion-dollar economic stimulus package

Leaders of NADA, ATD, NAMAD, AIADA, and the Alliance for Automotive Innovation sent a letter to President Trump asking for clarification that vehicle sales are essential services that need to be maintained during the COVID-19 pandemic.

Some compelling facts were provided in the letter:

• In 2019, 12.55 million vehicles were scrapped because they wore out or it was not economical for them to be repaired. Approximately 9.4 million of those vehicles were replaced with a new or used vehicle.

• In 2018, 1.24 million vehicles were determined by insurance companies to be total losses as a result of an accident, flooding or other total loss events. Individual consumers and businesses typically use their insurance proceeds to purchase a substitute vehicle within a few days. Without that option, they may not have affordable, reliable transportation to meet their personal or commercial needs.

• Between March and July of this year, 1.8 million vehicle leases will expire (4.1 million for the entire year of 2020), all of which will require replacement. In many ways, these customers will face the same challenges as described above following a total loss.

• Virtually all of last year’s 500,000 sales of medium and heavy-trucks were sold for use in commercial fleets. Officials noted 71.4% of our nation’s tonnage freight is hauled in trucks sold by our truck dealer members.

• The associations estimated that around 500,000 “Essential Critical Infrastructure Workers,” as defined in DHS/CISA Guidance (healthcare providers, law enforcement, public safety, first responders, food and agriculture employees, etc.), annually acquire a new or used vehicle.

* Please note that your click will directed you the NADA website on a new tab.

Automotive News gathered this important quote: 

“Not all vehicle sales are discretionary consumer purchases. A significant number of dealership sales transactions occur because a consumer or business is in immediate need of a replacement vehicle for basic transportation. This clarification is particularly important as various transit services have been curtailed or eliminated due to the public health recommendations about social distancing,” the groups said. “Our members would simply like to provide vehicles to those customers in a secure manner, while at the same time meeting our obligation to the public-at-large and our employees.”

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