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Hurricane Sandy’s Impact on the Auto Industry

Hurricane Sandy's Impact on the Auto IndustryHurricane Sandy’s Impact on the Auto Industry

While many of the mass transit systems are up and running again, the auto industry is facing significant long term effects in the aftermath of Hurricane Sandy.

The results are mixed, and often contradictory. Auto insurance claims are pouring in by the thousands. Demand for used cars is increasing as people seek to repair storm damaged ones, resulting in a shortage of rental vehicles available. The new car market will get a boost, but many dealerships have suffered losses and have to scrap thousands of brand new vehicles.

Estimates by the National Automobile Dealers Association tally the results at up to a quarter-million vehicles across the East Cost may have been damaged by Hurricane Sandy. Nearly a month later, cars still line the streets, idly waiting to be towed.

Rental cars are difficult to come by. Consumers need replacement cars for their own storm-damaged vehicles and emergency responders and local utilities need cars and trucks for the recovery effort. The result has left the rental car industry sorely scarce of vehicles. According to the New York Times, rentals for the four largest companies- Enterprise Holdings, Hertz Global Holdings, Avis Budget Group Inc. and Dollar Thrifty have all sold out in key location. Many are diverting vehicles from other areas to compensate for the high demand in the upcoming holiday season.

Sales of autos have also seen a spike. Insurance companies have received thousands of auto claims, and many are looking to replace storm-damaged cars. But, auto dealerships located in storm ravaged areas have felt the effects. Despite the expected boost, large numbers of brand new cars were damaged. According to Auto Blog, Toyota, Chrysler, Nissan, and Honda are set to scrap around 15,000 new vehicles ruined by the storm.

Contact A.J. Benet today for more information about our Westchester County Auto Insurance. (888) 639-4560

Source: Wall Street Journal

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