People who have been shut out the past month from buying a car will be able to now that Gov. Tom Wolf has lifted some restrictions on dealerships.
“We’ve got permission for online sales, but the showroom still will be locked down. We’re not allowed to have people coming in (the showroom) and kicking the tires,” said Jeff Smail, general manager of the family-owned Smail Automotive Group on Route 30, east of Greensburg. Showroom visits are by appointment only, Smail noted.
Wolf signed an order Monday permitting the electronic notarization of documents needed for closing real estate property sales and for buying a vehicle. Dealerships had been closed for sales since mid-March, when the governor ordered all non-life-sustaining businesses to shut down, making Pennsylvania one of three states to clamp down on car sales.
“At least it’s a little step in the right direction,” Smail said of this week’s action.
While dealerships can sell vehicles, the guidance from Harrisburg is to limit contact with customers, Smail said. For instance, customers will not test drive vehicles with a salesman sitting next to them.
“Our hands have been untied, but just a little bit,” said Scott Kalmar, owner of Kalmar Chevrolet, the dealership his grandfather opened in 1937 in Gilpin amid the Great Depression. “It still makes it a challenge,” he added, because so much of the contact between customer and the dealership must be online, with “very minimal (personal) interaction.”
Car dealers may have had fewer restrictions on activities had Wolf not vetoed the Republican-controlled General Assembly bill aimed at reopening businesses while maintaining the Centers for Disease Control guidance to take precautions on preventing the spread of the virus.
Reopening tens of thousands of businesses too early will increase the spread of the virus, Wolf said. Rather, the governor said he favors a “measured and staggered approach” to resuming economic activity, with a plan for some businesses to open up May 8.
The catch in the governor’s order allowing vehicle sales to resume isit is in effect for only 60 days, said John Putzier, president of the Greater Pittsburgh Automobile Dealers Association, an O’Hara-based trade group.
Putzier questioned why Wolf would not allow electronic notary measures to remain in place through however long the quarantine lasts, “to fill the emerging need” for people to buy new vehicles.
While the state gave dealerships the opportunity to sell vehicles again, “there is a lot of gray area” to the directives, said Bill Mohler, owner of Sendell Motors along Route 30 in Hempfield.
Can a sales associate approach someone walking on the lot to look at vehicles, if they talk through a mask from a socially accepted distance?
Other typical sales practices will undergo changes as well. A vehicle a person takes for a test drive will have to be disinfected afterward, Mohler said. Buyers are likely to drive off the lot without having someone provide a hands-on lesson on how to operate many of the vehicle’s functions, so a technician will have to contact them to answer their questions, Mohler said.
“In theory, we’re just going to have to play by Harrisburg’s rules,” Mohler said.
What many customers don’t realize is dealers have been on the hook for brand new cars that have sat on their lots for weeks. Manufacturers demand payment when the vehicles are delivered, Putzier said. Dealers typically turn to banks to borrow money in order to build their on-lot inventory. The dealers said, in some cases, lenders have been generous in deferring payments during the shutdown, but the money still will be due in the future.
“They’ve made some accommodations,” Mohler said. “They’ve been reasonable.”
Putzier, however, fears some dealerships will not survive the shutdown and slow reopening.
“I think we will see some fall out, like the single-franchise dealers” that may be undercapitalized, he said.
Coronavirus | Local | Regional