Many businesses are barely hanging on because of the restrictions put in place to blunt the spread of the coronavirus and the auto industry is no exception.
In an online survey of new car dealers in California, 40% of the respondents said their operations during the crisis are sustainable for only one to three more months.
"It's a cash flow business," said Brian Maas, president of the California New Car Dealers Association, the trade organization that conducted the survey. "When you press pause on that and there's no money coming in and no customers coming in, it's difficult to keep folks on staff and do the normal things a dealership would do."
Of the roughly 1,200 members in the car dealers association, 322 replied to the survey. Among the findings:
-- 40% reported sales dropping by 80 to 100% since the virus hit California
-- more than 10 dealerships have laid off as many as 60 employees, and
-- more than 70% reported enhancing their online sales and delivery capabilities.
About 90% of dealerships are still open, the survey said, largely because many have kept their service and parts departments open with reduced staff.
The survey was conducted March 30. "Since then, sales have even more dramatically stalled," Maas said.
Dave Miller, general manager of John Hine Mazda in Mission Valley, said his dealership has furloughed 43 of its 107 employees but has not laid off any workers.