Politics and Storms — Real Life Impacts on the Automotive Industry

As I write this article, it's worth noting that it's Election Day in the United States. I cast my vote this morning before work, and I hope that the rest of you did the same. At the same time, the Northeast is still recovering from Hurricane Sandy, which hit the area hard only a week ago. Why bring these points up here? Because both are great examples of how we, as an industry, have to be flexible and willing to roll with the punches.

One of the big talking points of this past campaign season was the federal bailout of the U.S. auto industry. This issue hits home for every member of our industry, because it had a tangible impact — the bailout helped keep factories working, people employed and cars being sold to consumers. The bailout itself, while not anything that happened recently, was a big point, with the two Presidential candidates — Barack Obama and Mitt Romney — disagreeing on several points. At one point, they disagreed on whether it should have happened at all. No matter what your personal political affiliation is, or your opinion on the bailout, there is no denying that it put our industry in the national spotlight once more. And I think that, overall, we came out pretty well in the examination. There are still things to work on, and those were pointed out, but at the same time, I believe it highlighted just how far we've come in a few short years.

Sandy was a less predictable, and far more destructive, hiccup in the overall industry recovery that is still going on today. I've read several reports citing that, as a whole, the industry lost many thousands, possibly hundreds of thousands, of potential sales because of the storm; that number continues to rise as people focus more on recovery than car buying. There are still many areas without power as of this article, and until things get back to normal, sales won't really start to recover.

Dealerships that didn't suffer any actual flooding or damage in many cases don't have power, or, quite simply, don't have customers interested in buying at the particular moment. But that will change — most pundits are predicting that, as much as sales will be hurt in the end of October and November, they will show a corresponding rebound in December through spring of next year. As much as 20 percent of all U.S. car sales happens in the effected region, so I think it's safe to say there will be a rebound, but will it be on par with what was lost, or will it lag a bit, as people turn their dollars towards repairs instead of down payments? That will remain to be seen.

Both scenarios above have forced the industry to be responsive to things that were, in many cases, out of its control. Dealerships, agents and franchises all had to be nimble to keep ahead of consumer expectations, accusations and natural disasters. And that, more than anything, goes to show how great of an industry we are. The ability to adapt and change, and be nimble enough as a whole to continue to stay ahead of even the most unpredictable events is what makes us the strong, solid industry we are today.