Automakers to Scrap Thousands of Sandy-Damaged Cars
As East Coast dealerships continue to regroup after Hurricane Sandy, Bloomberg News is reporting that automakers will have to scrap around 15,000 storm-damaged new vehicles.
Hurricane Sandy was the biggest Atlantic storm in U.S. history, causing at least 100 deaths and billions of dollars in damage. Larry Dixon, senior analyst for the National Automobile Dealers Association, told Bloomberg that about 200,000 vehicles may have to be replaced because of storm damage.
According to NADA, there are 886 car dealerships in New York and 463 in New Jersey. Many are continuing to assess the damage, and several are still closed. Last week, 56 Nissan and Infiniti dealerships were closed due to the storm, but a Nissan spokesman said all but five have reopened.
Brian Brockman, Nissan's Midwest manager of corporate communications, told Cars.com that about 6,000 dealer-inventory vehicles will have to be scrapped because of storm damage; he declined to provide a cost estimate.
It's a similar story for many automakers. Bloomberg reports that luxury electric carmaker Fisker Automotive lost 320 of its $103,000 Karma sedans in the storm, and Toyota and Lexus expect to lose around 3,000 vehicles. Honda and Acura also peg their loss at more than 3,000 vehicles, a spokesman told Bloomberg.
Ford and GM haven't yet formulated a scrap count, but Chrysler's Ralph Kisiel told Cars.com that its dealers reported that they had 750 vehicles in inventory that were damaged by the storm. "In Chrysler Group's case, our dealers will work with their insurance provider and/or floorplan lender to dispose of those vehicles," Kisiel said.