Mazda North American Operations reported total May sales of 24,933 vehicles, a decrease of 1.0 percent compared to May 2019. Year-to-date sales totaled 103,543 vehicles, a decrease of 10.5 percent. With 26 selling days in May, compared to 26 the year prior, the company posted a decrease of 1.0 percent on a Daily Selling Rate (DSR) basis.

Sales of the CX-9 increased 20.8 percent with 2,421 vehicles sold.  Sales of the MX-5 Miata increased 30.7 percent with 1,102 vehicles sold. CPO sales totaled 6,223 vehicles in May, an increase of 12.6 percent compared to May 2019. Year-to-date CPO sales decreased 10 percent, with 22,134 vehicles sold. Mazda Motor de Mexico reported May sales of 2,324 vehicles, a decrease of 50.0 percent compared to May last year. Year-to-date sales decreased 31.6 percent, with 17,166 vehicles sold.

The National Automobile Dealers Association announced that president and CEO Peter Welch will be retiring at the end of 2020.

Welch, 67, was appointed by the NADA Board of Directors in January 2013 to head the organization. Under Welch’s stewardship, NADA achieved a series of legislative and regulatory victories in a number of areas, including auto finance, tax reform, vehicle safety and international trade issues. Welch also led NADA through the sale of its used-vehicle valuation guidebook and its retirement planning business, oversaw an organization-wide rebranding initiative, led the planning of NADA’s year-long centennial celebration in 2017, and orchestrated the organization’s move to a new state-of-the-art office facility in 2018.

“I’ve had the distinct privilege of serving associations comprised of franchised new-car and truck dealers for 30 years, and it’s time for me to get ready for my proverbial ride into the sunset,” Welch said.

His retirement announcement triggers NADA’s succession plan, which includes the appointment of a NADA Director-led search committee. NADA has also selected international search firm Spencer Stuart to oversee the transition process. Spencer Stuart oversaw NADA’s CEO selection process in 2012.

In the week ending April 25, the advance figure for seasonally adjusted initial claims was 3,839,000, a decrease of 603,000 from the previous week’s revised level. The previous week’s level was revised up by 15,000 from 4,427,000 to 4,442,000. The four-week moving average was 5,033,250, a decrease of 757,000 from the previous week’s revised average. The previous week’s average was revised up by 3,750 from 5,786,500 to 5,790,250.

The advance seasonally adjusted insured unemployment rate was 12.4 percent for the week ending April 18, an increase of 1.5 percentage points from the previous week’s revised rate. This marks the highest level of the seasonally adjusted insured unemployment rate in the history of the seasonally adjusted series.

 

Cable news and economic updates look grim in this era of COVID-19.

But don’t tell Chad Bailey. The president of Akron Auto Auction, known for his energy and enthusiasm, is bringing those traits to defy the pessimism permeating the business world now.

His sale is moving forward while his staff is fashioned in Ohio-sports-themed face masks made by a family member.

It’s been a quick turnaround since the coronavirus outbreak slammed the country, causing Bailey to hit the brakes.

“We just took a deep breath in the first week of April,” he said. “We went home, took a step back and took the week off. We let everybody get their sanity back.

“Then we started to put together a game plan.”

Since then, Bailey’s continued to tweak and modify the game plan so the auction could go from crawling to walking to running again. At the same time, the business continues to focus on safety.

Akron Auto Auction is using all the Center for Disease Control guidelines to protect its workers, Bailey said.

“Obviously, everyone is socially distancing and in the office we have Plexiglass up everywhere,” Bailey said. “We have digital gun thermometers so we can make sure people who come in the building (don’t have a fever).”

Bailey also uses a product called PermaSafe, a vehicle disinfectant, that’s another layer of safety for dealers.

Bailey, board chairman of the National Auto Auction Association, is also implementing a checklist system for when it becomes safe for dealers to come into the lanes. It will allow dealers to fill out online forms in advance to state they don’t have symptoms and follow all the CDC guidelines. It’s one less step they’ll have to do when they come in the building.

“It’s like a pre-screening,” he said. “It allows us to keep a paper trail. We’ve been pro-active.”

The auction had a visit from the Health Department when someone complained they had too many people in the building.

“I’m glad they came,” Bailey said. “They saw how we had everything set up and everything labeled. It’s the best PR I could get. I’m not worried at all. We’ve got nothing to hide. I’ve got deputy sheriffs who work here on sale day. If I wasn’t allowed to be open, they wouldn’t be allowed to be here.”

As result of Bailey’s methodical planning, the auction is gaining momentum.

“We are doing online, all digital, at the moment,”
Bailey said. “We’re using Auction Edge, which is Edge ASI  and Pipeline. We use Velocicast for (simulcast).”

Akron has gone an extra step in allowing dealers to come, check out the cars and test-drive them on Friday and Monday, before Tuesday’s sale.

“We ran every other week, pretty much, for April, because of the uncertainty and trying to get stuff organized.,” he said. “(April 21) we ran 1,130 cars and sold 650.

“It was awesome.”

Going forward, Bailey was planning to hold a sale every week.

“I’ll have probably an 800-car sale on (April 28) without any repos,” Bailey said.

Unlike other states, Ohio didn’t prohibit car sales when the state shut down.

“The governor wouldn’t commit to sales being essential or not,” said Wendy Rinehart, executive director of the Ohio Independent Automobile Dealers Association. “He let the business owners decide for themselves and follow CDC guidelines.”

To protect its drivers – who are typically older retirees – Akron Auto Auction has used-car haulers and repo haulers to pick up cars.

Bailey said since lenders are being discouraged from repossessions, the repo haulers have fewer vehicles to pick up – i.e. less work. Akron hires them to pick the vehicles up that its own drivers would have done in the past.

The game plan seemed to be working at a recent sale.

“My big new-car dealers – between the three of them    consigned about 450 cars and were over an 80 percent (conversion rate),” Bailey said.

There weren’t just dumping cars in the lanes, Bailey said.

“They were selling over 80 percent because what they wanted, they got, and even more,” he said.

The values still took a hit in the current market.

The average selling price was $4,550 on April 21, lower than his typical $6,500 block price.

Bailey also has his own floorplan company, which is considered an essential business, allowing him to provide dealers with another service.

He has added some Ohio flair to his safety protocols.

Bailey said two family members –related to his uncle, a former owner of the auction – are connected to a sewing shop.

When the whole issue of face masks came up, Bailey had an idea.

“We have a Jo-Ann Fabrics by us, so I think I ordered enough fabric to cover a football field,” Bailey said. “I got Cleveland Browns, Cavs and Indians (designs) along with patriotic stuff. I shipped them all to (the sewing shop).”

The masks have the elastic bands as well as the metal tabs to form around the nose for safety, he said. They also have the filters that can be replaced in the mask.

“So now everybody is wearing them,” Bailey said. “There are really good things going on at Akron.”

Industry leaders had a more optimistic outlook as they celebrated their lobbying efforts while looking ahead during a weekly conference call moderated through the National Auto Auction Association.

The first bit of good news was a federal agency’s advisory that auto sales are an essential industry, the result of intensive lobbying and industry teamwork, according to National Auto Auction Association CEO Frank Hackett.

Hackett said participants on NAAA’s weekly conference call on April 20 celebrated the Department of Homeland Security’s Cybersecurity & Infrastructure Security Agency (CISA) advisory update that declared that auto sales were an essential industry.

Industry lobbyist Sante Esposito said this shows how consistent lobbying pays dividends for the industry, Hackett reported.

The NAAA, along with the National Independent Automobile Dealers Association, National Automobile Dealers Association and other industry groups, lobbied heavily for the essential industry designation.

 “We supported the new-car and used-car dealers by sending a letter to the President, Vice-President, cabinet leaders, majority and minority leaders in Congress and so forth,” Hackett said. “Our lobbyists received responses from many of those who acknowledged our letter of support.

“I think the fact that we’re known in Washington – where we weren’t 15 years ago – shows our lobbying work has paid off.”NAAA CEO Frank Hackett

Hackett said NAAA’s letters may not have been the catalyst for the change, but it is an example of how the industry is being helped by NAAA and other groups’ efforts.

It also shows how different players within the industry, from new-car dealers to used-car dealers and auctions, can work together for mutual benefit.

Hackett said years ago, many industry leaders were reluctant to lobby, afraid that it would just put a target on an industry that already was heavily regulated.

Leaders, however, decided it was an important part of defending the industry.

“We talked about making friends before we needed them,” Hackett said. “What’s paid off is we’ve made a lot of friends in Washington and it’s helped us.

“This is an example of making friends in Washington, having a lobbyist and being able to influence decisions that are made.”

Even as various companies within the industry are competitive with each other, they are able to put that aside in order to fight for the greater good, Hackett said.

NAAA has done this in the past in its efforts to fight odometer fraud as one example. This was an issue that interested regulators but also concerned the auction industry.

Overall, the mood has improved from previous weeks, Hackett said.

“The meeting was very positive. You get a sense that they are thinking, ‘next step, next step,’” Hackett said .”Businesses are sensitive to the safety of the workers. But at the same time, they’re optimistic that we’re going to come out of this sooner rather than later.”

Hackett said a discussion about a Cars.com survey about people who typically rely on public transportation and ridesharing services revealed that the “vast majority” would increase their reliability on personal transportation. Of those, 26 percent would look at a new vehicle purchase.

The group also reiterated its focus on preventing any type of Cash for Clunkers legislation that would mirror the 2009 program. That earlier program crushed 700,000 vehicles, taking them out of the supply pipeline.

Hackett added that auto analyst Glenn Mercer reported that, despite all that’s been happening, the average new-car transaction price is still climbing.

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