Automakers Will Scrap 15,000 New Vehicles Damaged By Sandy
Toyota Motor Corp., Chrysler Group, Nissan Motor Co., Honda Motor Co., and their dealers plan to scrap more than 15,000 new vehicles damaged by Hurricane Sandy as the industry continues assessing the storm's impact.
Nissan alone estimates more than 6,000 Nissan and luxury Infiniti brand cars and light trucks are "un-saleable" because of the storm, Travis Parman, a company spokesman, said.
Including used autos and those of individual owners, as many as 200,000 light vehicles may have to be replaced, said Larry Dixon, Senior Analyst for the National Automobile Dealers Association.
"Total vehicles affected may be about one-third of what we saw with Hurricane Katrina, and that was about 600,000" used and new vehicles, said Dixon, based in McLean, VA. "We don't see replacement demand starting to accelerate until we're into December."
Sandy, the biggest Atlantic storm in U.S. history, raked New Jersey, New York, and the surrounding region with winds of as much as one hundred miles an hour. The storm's surge of more than thirteen feet inundated transit tunnels and underground utilities, destroyed homes, and eroded natural barriers such as beaches after it struck October 29.
U.S. industry-wide light-vehicle sales in October fell short of the average estimate of analysts surveyed after Sandy slammed the East Coast during the industry's busiest time of the month. Sales for the month rose 6.9 percent, below the twelve percent gain that was the average of nine estimates. Automakers have said those sales should be made up by year end.
Fisker Automotive Inc., a startup maker of luxury plug-in hybrids, lost 338 of its $103,000 Karma sedans at the port of Newark, NJ, including 16 that burned in a fire triggered by salt water, said Roger Ormisher, a spokesman for the Anaheim, CA-based company.
"We don't have a full estimate of the cost to replace them yet," he said. The closely held company's cars were being processed for delivery to dealers when the storm arrived. Replacing 338 Karmas at the $103,000 base price would total $34.8 million.
General Motors isn't yet able to provide an estimate for damaged vehicles, said Jim Cain, a spokesman for the Detroit-based company.
Ford Motor Co. also couldn't immediately provide estimates for storm damage, said Elizabeth Weigandt, a spokeswoman for the automaker.