CoVid-19 Industry Updates

CoVid-19 Industry Updates (73)

ProGuard Warranty has formed a professional alliance with SnapCell Inc. to bring their innovative automotive personal video solution to ProGuard’s base of independent and franchise dealers across the United States. ProGuard Warranty plans to introduce SnapCell’s simple to use, online video capabilities for automotive sales, service and business development centers through a discounted rate that allows dealerships to keep their digital doors open while maintaining social distancing.

 

The SnapCell technology enables the automotive sales process to be facilitated with virtual digital retailing. Live video streaming can be used for face-to-face contact with the customer and they can even take the customer on a virtual test drive to replicate the dealer experience. The functionality extends to the service lane side of the operation where technicians can use video to explain the repairs recommended for the customer’s vehicle, expediting approvals and opening more bays.

ProGuard had been in product testing mode for over a year when the COVID-19 crisis hit.

“While we didn’t foresee a nationwide shutdown, we were already in talks with SnapCell as a solution dealers could use to adapt to the changed shopping experience,” said Dominic Limongelli, president, ProGuard Warranty. “We’ve found that collaborating with companies in other channels is a great way to add value and better serve our clients.

Edmunds is extending through the end of May the 50 percent discount that it provided to its dealer partners in April. Subscription services for dealer partners will remain active and fully supported by Edmunds’ sales teams.

“Edmunds is doing everything it can to support our dealer partners as our industry continues to navigate through this crisis,” said Avi Steinlauf, Edmunds’ chief executive officer.

Edmunds has also launched a completely redesigned Industry Center page, where dealers can find all of Edmunds’ free digital product offerings and solutions that will help them better navigate the challenges of the current selling environment. These include inventory badges on the Edmunds website for stores that offer home delivery or have custom hours, and Edmunds’ Digital Retailing solution, which lives on the Edmunds website and enhances remote sales by driving car shoppers who have already built their deals online directly to dealers.

Kia Motors announced that production of face shields has begun at its manufacturing plant in West Point, Ga. Initial donations of medical use face shields assembled at Kia Motors Manufacturing Georgia (KMMG) will be made in Georgia, Alabama, New York and California.

With a monthly capacity of 200,000 units, the face shields are being assembled by paid volunteers from KMMG, which has implemented a series of safety measures to protect team members, including: conducting temperature scans, providing face masks and gloves, and staggering workstations. Materials are being sourced from vendors such as 3-Dimensional Services Group, a Michigan-based rapid response manufacturer supporting prototype and low volume production applications.

On April 16th the first Ventec Ventilators were shipped out of GM’s plant in Kokomo, Indiana and the workers that built them wrote notes and signed the boxes with messages of hope and support for frontline hospital workers and people suffering from COVID-19.

GM began working with Ventec, a small Seattle-based producer of the ventilators, in early March and mobilized more than 1,000 employees and nearly 100 auto suppliers to start making the critical machines in the fight against COVID-19. The goal is to eventually make 10,000 ventilators per month, according to GM and Ventec, but the companies didn’t specify how long it would take to reach that output. GM also plans to produce masks.

With 960,000 US COVID-19 patients potentially needing ventilators, President Trump ordered General Motors on March 27th through a 1950’s wartime act⁠ to make ventilators for U.S. hospitals treating COVID-19 patients. GM said it began work on the life-saving machines on March 16th. 

Mazda North American Operations (MNAO) announced it will provide free standard oil changes and enhanced cleaning services for U.S. healthcare workers at participating dealers nationwide. This program, which began on April 16, is not limited to Mazda owners and is available for most makes and models from other manufacturers. The Essential Car Care program, developed in partnership with the Mazda dealer network, will invest a minimum of $5 million as part of the initiative.

“Supporting the communities where we live and work is rooted deeply in Mazda’s 100-year history. We are honored to give back to those dedicated to saving lives during this pandemic,” MNAO President Jeff Guyton said.”

 

Dealer XT, an auto dealer compliance firm, has created a petition to urge California Gov. Gavin Newsom to declare auto dealers as essential businesses.

In the online petition, Dealer XT asked Newsom to “expressly add” auto dealerships to the list of the essential businesses. It said the state’s position only lists auto repair and supply businesses as essential and is unclear and conflicts with other local government lists.

The petition states, “Automobile dealers are currently experiencing confusion about whether they can remain open as an ‘essential business’ as it relates to automobile sales. As an example, the Counties of Sacramento and Merced have specifically listed automobile dealer sales as ‘Essential Businesses’ while other counties have not. Some counties have now amended their orders to allow cars sales with certain restrictions.”

The petition shares stories of healthcare workers who, for various reason, were left without transportation because they could not buy a car. It also explains that most dealerships have small staffs and are able to social distance and protect customers. The petition adds, “Over the past few weeks, simple solutions have successfully been applied by many essential businesses across the state to provide a safe environment. Why not allow car dealerships to do the same?”

Total industrial production fell 5.4 percent in March, as the COVID-19 pandemic led many factories to suspend operations late in the month.

Manufacturing output fell 6.3 percent; most major industries posted decreases, with the largest decline registered by motor vehicles and parts. Total industrial production for manufacturing saw its largest declines since January 1946 and February 1946, respectively. The indexes for utilities and mining declined 3.9 percent and 2.0 percent, respectively. At 103.7 percent of its 2012 average, the level of total industrial production in March was 5.5 percent lower than a year earlier. Capacity utilization for the industrial sector decreased 4.3 percentage points to 72.7 percent in March, a rate that is 7.1 percentage points below its long-run (1972–2019) average.

The weakness in consumer durables was led by a drop of 27.2 percent in automotive products, while the decline for consumer energy products reflected decreases in both fuels and utilities. The production of business equipment decreased 8.6 percent, held down by a drop of 22.8 percent in transit equipment that reflected cutbacks in the output of both motor vehicles and civilian aircraft.

Manufacturing output dropped 6.3 percent in March and at an annual rate of 7.1 percent in the first quarter. In March, the index for durable manufacturing fell 9.1 percent; the most sizable decline among its components was in motor vehicles and parts, where output fell 28.0 percent.

Hyundai Motor America announced the expansion of its support for COVID-19 drive-thru testing to 22 hospitals nationwide with $4 million in grants through its Hyundai Hope On Wheels program. These grants are designed to combat the coronavirus by providing increased access to testing throughout the nation.

The company also announced an in-kind donation of 65,000 COVID-19 RT-PCR tests developed by Seegene, a South Korea-based global leader in multiplex molecular diagnostics.

“As a global automaker, we continue to monitor the COVID-19 situation and its potential harm to the U.S. and beyond,” said Jose Muñoz, president and CEO of Hyundai Motor North America. “A best practice that was crucial in South Korea’s handling of the coronavirus was drive-thru testing. This approach protects the healthcare workers and patients from the potential spread of the virus, while diagnosing those most in need.”

Hyundai and its over 825 dealers have also provided support to local institutions with financial assistance, food donations, face-mask headband production and loaned vehicles.

Related finance companies are not being approved for loans under the Paycheck Protection Program and that’s a mistake, according to the National Independent Automobile Dealers Association.

NIADA, through its CEO Steve Jordan, made its case this week by sending letters to leaders of the U.S. Congress, the Small Business Administration and the Senate Small Business Committee.

“As NIADA members begin to apply for PPP loans, we find that the dealership entities are being approved with little concern. However, RFCs are routinely denied with lenders stating current SBA guidance prohibits finance companies from receiving a PPP loan,” Jordan wrote.

Citing the specific sections of the CARES Act, the NIADA contends that despite Congress’ “clear intent,” the act seems to limit and exclude RFCs from participating in the program.

Jordan wrote,  “NIADA believes this limitation clearly conflicts with the intent, if not the express language of the statute.”

NIADA provides proposed language to allow the RFCs to participate in PPP.

“This change will permit our BHPH (buy-here, pay-here members’) RFCs to get much needed help to keep America’s credit-challenged essential personnel driving,” he wrote.

Jordan also discussed the important role that RFCs and buy-here, pay-here dealers play in helping unbankable customers get financed for basic transportation.

As Auto Dealers large and small are deemed an essential service across the country dealers are turning to online tools to continue to sell and repair cars during the Covid-19 pandemic. Tesla, which was already set up for online buying and delivery has added new social distancing features to protect the buyer and Tesla employees .

Tesla developed two new-vehicle pick-up options: Express Delivery and Direct Drop, for customers on edge about Covid-19 exposure. Tesla Express Delivery uses Tesla's smartphone app and each new car's onboard data connection to avoid handling or transferring any car keys. A buyer still shows up in person to a Tesla delivery center to a scheduled appointment. Using the apps location tracking the buyer goes directly to their new car to inspect and sign documents. All documents are in the car ready for signing. An advisor  collects the documents for review while a technician adds a temporary tag and license plate.

With Tesla’s Direct Drop everything is done digitally, paperwork is e-signed and payment is handled online, the buyer then uses the tesla app to pick a location for drop-off. Tesla drops off the car at the requested stop and the buyer unlocks the car with the tesla app. The whole process involves no physical human interaction at all.

Select Toyota dealers are offering to deliver a new or certified vehicle straight to a buyers door at no extra charge, and owners in select areas can have service performed remotely at their home. Toyota has expanded their internet and call center to allow for better remote communication.  GM dealers are offering a similar shopping experience.

Its not just larger Dealers that are adding successful social distancing buying options for their clients either. Township Chevrolet in Summerside, PE is offering social distancing sales, buy allowing customers to pick a vehicle, set a date and time for a home test drive and then delivering the vehicle to the home for a test drive after being sterilized. They have also made adjustments to allow those who visit the dealership to remain properly distanced.

An issue used car buyers and sellers may run into with selling/buying a vehicle, are inspections from an independent mechanic. Dealers may want to make this easier for their buyers by setting up easy third party inspections where they drop off and pick up the vehicle and certify the vehicle as being disinfected after inspection before it is dropped off to a buyer for a test drive. Paperwork can be left in the vehicle and mailed back to the dealership or completed onlline.

There are currently two major contenders that sell used cars nationwide online.  Vroom and Carvana have been setting the standard for selling cars online across the country for sometime. Vroom vehicles undergo a 126-point inspection before they’re accepted for sale. Carvana vehicles, must pass a 150-point inspection as well as undergo an Experian auto check report. After purchase, customers have the option to test drive their cars for seven days before they can return them. Carsense is offering curb-side delivery in there NY and PE locations and home delivery in other locations .

Adding social distancing options like curb-side drop-off, online paperwork, over the phone sales, drop off test driving, delivering and picking up vehicles for 3rd party inspections and certifying vehicles as disinfected will help normalize car sales during the pandemic . According to Google’s latest stats, 71% of people turn to online searches first to solve their problems. Buying cars is no different , people will be looking for what Dealers are doing to minimize contact with social distancing and protecting the buyers through the whole process of purchasing a vehicle.

 

 

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