Florida experienced “catastrophic” conditions the last two days after dealerships from Tampa to Florida’s Atlantic Coast closed before Hurricane Ian blasted the state.
By Thursday morning, Ian was downgraded to a tropical storm and was making its way through central and northern Florida — threatening the Georgia and South Carolina coastal areas.
“Most, if not all, of my dealers have closed Wednesday and Thursday,” Central Florida Auto Dealers Association CEO Evelyn Cardenas wrote in an email Wednesday. “They have been working hard over the past two days to prepare to ensure the safety of their staff and stores.”
The Category 4 hurricane made landfall near Fort Myers, Fla., around 3:05 p.m. EDT. Maximum sustained winds were estimated to be near 150 mph, the Weather Channel reported.
More than 2.5 million electric customers in Florida have no power, the Weather Channel said.
The National Weather Service said Ian was “causing catastrophic storm surge, winds and flooding” in the state.
“Hurricane conditions are ongoing within the Hurricane Warning area now and will slowly spread northeastward through the day,” the weather service said Wednesday. Catastrophic flooding was predicted in the storm’s wake.
Florida’s Gulf Coast from the Suwanee River at the Panhandle all the way to Flamingo, Fla., in the south carried a storm surge warning, signifying a risk of life-threatening surges. The northeastern part of the state from the Georgia border to the Palm Coast, Fla., area and in the St. Johns River area also were under storm surge warnings.
Widespread catastrophic flooding, including “major to record” flooding along rivers, was expected to continue in Central Florida. “A few” tornadoes were also a possibility in east central Florida, the weather service said.
Closures
The Maus Family Auto Group’ stores in Tampa, Port Richey and Homosassa addressed the possibility of flooding in Tuesday Facebook posts announcing their four locations’ closure from 5 p.m. Tuesday through Thursday.
“If your car gets flooded, contact us before starting it,” Maus Nissan of North Tampa wrote to customers. “We may be able to minimize the repairs.”
Asbury Automotive Group Inc. said it would close its final four locations in the state by noon Wednesday after having already closed 13 of its 24 stores Tuesday and seven more Wednesday morning.
Penske Automotive Group closed its Orlando location, Central Florida Toyota, for Wednesday and Thursday. The website for Palm Beach Toyota in West Palm Beach, Fla., said the dealership’s sales and service departments would close at 1 p.m. but reopen Thursday.
“We continue to monitor the situation and have taken precautions to ensure the safety of our employees and customers. We have closed the dealership in Orlando for today and tomorrow – again, the safety of our employees and customers is our top priority,” Penske spokesman Anthony Pordon wrote in an email.
Kisselback Ford owner Bobby Kisselback tweeted Tuesday he would close his St. Cloud, Fla., dealership Wednesday and Thursday.
“Our plan is to be back open on Friday with normal business hours,” he tweeted.
Over on the vendor side of the industry, Southeast Florida-based F&I product provider JM&A Group’s Deerfield Beach, Fla., offices were closed, spokeswoman Lauren Fyke wrote in an email Wednesday.
“[O]ur associates who can do so are working remotely to continue serving our dealers, and our associates outside of the storm’s path maintain business as usual,” she wrote. “There should be no interruption to our JM&A Group operations.”
The Alan Jay Automotive Network, which has dealerships in Wauchula, Sebring and Clewiston, Fla., said Tuesday it was closing the entire group Wednesday and Thursday.
“We will be closed Wednesday & Thursday so our employees can take care of themselves, their family & property,” the group posted on Facebook. “Weather permitting, we will reopen our doors to our loyal customers Friday morning. Please be safe & be kind!”
Being prepared
The head of an Indialantic, Fla.-based dealership insurance vendor said Florida retailers have likely already prepared for storms like Ian.
Between deductible costs and the risk of losing what vehicles they have left to sell, Florida dealerships “have a certain level of ‘skin in the game'” with hurricanes, Dealer Risk Services President Steve Gibson wrote in an email Wednesday.
Gibson said Florida dealerships have disaster preparedness plans and review them at the start of the hurricane season in early June.
“The steps and timelines are calculated and based on the path and proximity of the storm,” he wrote.
One key consideration involves protecting inventory. According to Gibson, many of Florida’s inventory carriers exclude wind and/or flooding from certain areas’ dealership coverage.
“Thus, it is important for the Dealer community to understand the limitations of their coverage and identify locations where they can move the units until the storm passes,” Gibson said. However, he said inventory insurers often will reimburse some of a dealership’s expense incurred by moving vehicles.
The Ed Morse Automotive Group on Tuesday moved about 500 vehicles from its Brandon, Fla., and Tampa., Fla., locations inside, Florida director of variable operations Brian Danahy told Automotive News.
Images provided by the dealer group depict the Brandon, Fla.-based Ed Morse Alfa Romeo Fiat and Ed Morse Cadillac Brandon and the Tampa, Fla.-based Ed Morse Cadillac Tampa and Ed Morse Mitsubishi interiors packed full of vehicles.
Staff were able to go home by noon that day, Danahy said. The Ed Morse website on Wednesday called the four locations closed until further notice.
Even dealerships protected by insurance can rack up significant losses, Gibson said. He said inventory policies for catastrophe-prone areas often impose a weather deductible on each damaged unit in the claim, and these amounts can reach as high as $5,000 per vehicle. Financial exposure can be severe during more typical inventory situations than dealers have today.
Gibson said dealership property coverage also often carries wind deductibles between 2 percent and 5 percent of of the dealership’s property value. For a dealer whose property is worth $20 million, that’s still a large check, he noted..
After a storm, dealerships should examine damage, notify their insurers and dry out any vehicle interiors that could mildew or mold.
“Again, this goes a long way toward the salvage value of the units and the mitigation of the loss,” Gibson wrote.
But if a dealership’s inventory survives, a storm can actually mean “a ‘silver lining,’ if there is one in a community weather event,” for the retailer, Gibson wrote.
“Local homeowners and businessowners will soon be armed with insurance company checks and seeking replacements for their own damaged units,” he wrote. “Being the Dealer in town with the most units available can help make a bad situation profitable for the Dealership and satisfying for the customers.”
Melissa Burden, Hillary Rubin and Tierra Riddick contributed to this report.
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