CBT automotive newscast: February 23, 2021

Featured Interview:

Joe Shuster discusses his role in reviving Honda of Downtown Los Angeles
Today on CBT News, host Jim Fitzpatrick is joined by Joe Shuster, Dealer Principal at Honda of Downtown Los Angeles. Shuster was instrumental in reviving the Honda dealership after it spent nearly a decade in bankruptcy. Last summer, Honda of Downtown LA sold for $80 million. Shuster begins the conversation by sharing his story of acquiring the bankrupt auto dealership. He originally looked at the dealership in 2011 when the business was completely shut down. He left California with no interest in buying the store. After being consulted by people he trusted, he came back around to the idea of making the acquisition. Watch the full segment here.

Top Headlines:

Porsche executives believe the global chip shortage could negatively affect operations for several months. Yesterday, Porsche CEO Oliver Blume told CNBC that the lack of semiconductors in the industry is a, “very concerning issue.” His comments and concern come at a time when automakers across the world are being forced to halt operations at multiple plants for the foreseeable future.

On Monday, President Joe Biden announced several changes to the paycheck protection program that will provide further assistance to small businesses and those that are minority-owned. The plan will institute a 14-day period beginning February 24 through March 9 during which only businesses with fewer than 20 employees can apply for PPP loans. The Biden Administration also said that the share of funding distributed through community development financial institutions and minority depository institutions has increased by more than 40%.

The Chief of the Cherokee Nation is asking Jeep to change the name of its Cherokee and Grand Cherokee vehicles. Regarding the name, Chief Chuck Hoskin Jr. said, “I’m sure this comes from a place that is well-intended, but it does not honor us by having our name plastered on the side of a car.” The Grand Cherokee is Jeep’s best-selling vehicle and the Cherokee is its third-biggest-selling model. Together the vehicles made up more than 40% of Jeep’s total sales in 2020.

Kia and Hyundai were hit by ransomware last week. The automakers suffered extended network outages after hackers infected computer systems and disrupted operations. The attack slowed sales, made warranty service nearly impossible, and locked customers and vehicle owners out of mobile applications. Several Kia dealers have confirmed that their digital communication platform was unavailable for several days

News & Opinion:

The dangers of cybersecurity and fraud in 2021: What your dealership should know
There are many pros when it comes to allowing customers to purchase cars online. There is an increase in efficiency, greater ease of organizing documents, and a potential rise in customer satisfaction due to the convenience. Nevertheless, there is an enormous threat that you may already have experience with: cybersecurity and fraud. Cybersecurity company, Purplesec, found that cybercrime is up 600% due to the COVID-19 pandemic. Additionally, over 18 million websites are infected with malware at a given time each week. Therefore, while online interactions do bring convenience, they also enable the threat of attracting fraudsters and hackers who want to breach your database and steal customer information. Read more

Temporary change in PPP loans provides funding to small businesses only
On Monday, President Biden’s administration announced a temporary change to the Paycheck Protection Program that restricts the size of the company applying for a forgivable loan to just 20 employees. The change aims to make it easier to get necessary money into the hands of small businesses, minority-owned companies, and sole proprietors who haven’t been able to access previous rounds of financial support from the PPP. Effective Wednesday, Feb 24, the Small Business Administration will only accept applications for PPP loans from businesses with less than 20 on the payroll. The change will be in force for two weeks, and it’s expected the program will resume normal application processing on Mar 9. During the change, businesses with 20 employees or greater will be blocked from submitting applications. Read more