Lobbying Efforts in COVID-19 to Classify Auto Sales as Essential Business

The US Government has deemed automotive services and repairs as ‘essential business’ during the COVID-19 pandemic. For many dealerships, that’s good news as any source of revenue will help them maintain liquidity in an uncertain climate. Some dealerships have chosen to play it safe, closing all departments store-wide until the threat is under control.

Sales, on the other hand, is a different beast altogether. Dealers are saddled with millions of dollars in new and used inventory. Some states like Pennsylvania have shut down all auto sales altogether while others permit remote selling or by appointment only. This has been a focus for automotive associations across the US, lobbying to deem auto sales an essential business, just like auto repairs. 

Inconsistencies Across the Nation

Currently, each state must determine for themselves which businesses are considered essential if they aren’t on the CISA list that applies nationally. In many sectors including automotive sales, the directives are hard to find and all over the map. For example:

• One of the first states to implement a shelter-at-home directive, California has restricted auto sales almost completely. In certain counties listed on the CNCDA website, only online sales are permitted. An exception for in-person sales to essential services is listed. 
• The State of Arkansas is one of the few hold-outs that has not implemented stay-at-home orders. Currently, all car dealership business can be performed in the state so long as social distancing is practiced.
• Effective April 3rd, Florida’s executive order defines auto sales at new and used car dealers as ‘essential business’, allowing them to be open for retail operations.
• According to Connecticut’s Business Exemptions for Coronavirus, auto dealers can continue selling cars remotely or in an area that’s been cleaned to CDC guidelines.
• The hardest-hit state in the nation, New York, had forced dealerships to cease all sales. However, remote and online selling is once again permitted.
• In Michigan where the virus is rapidly gaining traction, car sales aren’t permitted unless in emergency circumstances such as an essential worker who needs to replace a badly damaged vehicle. 

Automobile associations largely want policy to apply nationwide rather than by each state. Of course, organizations are lobbying for a decision that permits dealers to safely conduct sales business or have the option to do so. 

Organizations Lobbying the Government for Car Sales

Spearheading the initiative is the National Automobile Dealers Association, as one would expect. A letter dated March 23, 2020 was sent to President Trump to clarify the designation of ‘essential business’ as it pertains to auto dealers.

In addition to NADA, other associations have joined the effort to lobby for auto sales as essential business during the pandemic. The New York State Automobile Dealers Association (NYSADA) lobbied NY state to reconsider the sales restrictions in place and succeeded.

Also siding with NADA in lobbying efforts and signing the letter to the President are the American Truck Dealers (ATD), National Association of Minority Auto Dealers (NAMAD), the American International Automobile Dealers Association (AIADA), and five other groups.

The Special Equipment Market Association (SEMA) in addition to eight other automotive trade associations pushed US governors to standardize the meaning of ‘essential businesses’ in COVID-19. It would also stand to reason that influential automakers like Ford Motor Company are lobbying for auto sales as essential to help salvage whatever sales are possible in Q2 2020.

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Car Biz Today, the official resource of the retail automotive industry.