Coronavirusly COVID-19 Automotive News

In automtoive COVID-19 news are GM, Cox, Edmunds, CCC Information Services Inc., PSA, Park Mobile, Kia Travelers’ Insurance, and Ziebar.

GM Coming Back

Statement from GM:
“The restart of vehicle production at General Motors’ component and assembly plants in North America has gone smoothly thanks to strong teamwork. Our comprehensive safety procedures are working well, and our suppliers have done a great job implementing their return-to-work strategies and safety playbooks. We are now in a position to increase production to meet strengthening customer demand and strong dealer demand. Starting Monday, three crossover assembly plants in the United States and Canada will be operating two production shifts, and three U.S. assembly plants building mid- and full-size pickups will move from one- to three-shift operations. Five other U.S. assembly plants will operate one production shift.”

Sales Are Coming Back

COVID-19 continues to plague the light vehicle market, but May’s sales pace is still expected to be a giant step forward on the path to recovery. According to a forecast released by Cox Automotive, new light-vehicle sales volume in May is expected to finish near 1,050,000 units, down 33% compared to last May but up 49% from last month.

After incorporating seasonal adjustments, the annual vehicle sales pace is expected to finish near 11.4 million, up from last month’s historically low 8.6 million pace but still far below May 2019’s robust 17.4 million level.

May is normally a critical month for the industry as it kicks off the summer sales season. When sales are reported next week, analysts will be searching the results for signs of an industry in recovery. According to Charlie Chesbrough, senior economist at Cox Automotive: “Recent trends suggest daily sales are showing significant gains over March and April’s collapse. Data reveals the market hit a bottom around the first of April, and since then has been making a slow but steady recovery. The opening of dealerships, and whole states, over the last few weeks is greatly contributing to the upward sales trend. The key question for the market going forward is whether these modest but steady sales gains will continue into June or does the sales recovery stagnate.”

Multiple Headwinds Could Impede Sales Recovery

As the industry drives into the summer selling season, a full sales recovery faces multiple headwinds. This crisis is unique because the industry is facing a negative demand shock and a negative supply shock simultaneously. Vehicle factories have been mostly closed since late March and are only beginning to restart. That means new-vehicle inventory is at the lowest volume in more than a year. Low inventory means less choice for consumers, particularly with popular vehicles like pickup trucks and SUVs. As sales begin to recover, inventory levels will be drawn down even further, quickly causing some brands to face serious shortages. At a minimum, selection may become more limited as the desired model may be in stock but not in the consumer’s preferred color or trim, potentially resulting in the consumer delaying purchase, switching brands, or moving into the used-vehicle market.

In the COVID-19 Digital Shopping Study 2.0 released today, Cox Automotive assesses how the global pandemic has impacted vehicle shopping habits, how vehicle consideration has changed, and how luxury and non-luxury shoppers’ purchase decisions differ. The study found that once consumers feel safety measures are in place and business are open, nearly half of in-market shoppers expect to transact in 30 days or less.

With the economy in recession and unemployment elevated, the study found that consumers are interested in the “right deal.” Price incentives and low-to-no APR are sill the leading offers that can trigger a shopper to move forward who may have been delaying their purchase. The study also finds that nearly half of consumers in market have reconsidered their price point for a new vehicle, and consumers are also looking to lower their down payments on a new-vehicle purchase. Even before COVID-19 hit, the auto industry was wrestling with a new-vehicle affordability issue. In the aftermath, the problem will likely be accentuated.

Use of Digital and Virtual Tools Increases Sharply
Both consumer demand for and dealership use of digital and virtual tools has increased during the global pandemic, according to Cox Automotive data. Online shopping sites, Autotrader.com and KBB.com, have seen record-breaking traffic on weekends, likely as shoppers spend time online instead of on dealership lots. Vehicle description page views are up relative to overall traffic, and the volume of online chats and text messages sent to dealerships via the shopping websites has increased 150%. On Autotrader.com, the volume of digital retailing “deal sends” – when a customer makes an offer online – is up more than three-fold year over year. The Cox Automotive COVID-19 Digital Shopping Study found that consumers want to do more online, with 2-in-3 now more likely to purchase a vehicle completely online.

May 2020 Sales Forecast Highlights

• In May, new light-vehicle sales, including fleet, are forecast to fall to 1,050,000 units, down nearly 33% compared to May 2019. When compared to last month, sales are expected to rise by roughly 347,000 units, an increase of 49%.
• The SAAR in May 2020 is estimated to be 11.4 million, far below last year’s 17.4 million level but a big improvement from last month’s 8.6 million pace.

May 2020 Forecast

All percentages are based on raw volume, not daily selling rate.

Memorial Day Sales Give Vehicle Sales a Boost

The car shopping experts at Edmunds say that generous financing offers and incentives during Memorial Day weekend helped give the auto industry a much-needed boost in May, forecasting that 1,074,542 new cars and trucks will be sold in the U.S. for an estimated seasonally adjusted annual rate (SAAR) of 11.8 million. This reflects a 32.5% decrease in sales from May 2019, but a 50.5% increase from April 2020.

“We can safely say that April was the bottom for auto sales during the coronavirus pandemic,” said Jessica Caldwell, Edmunds’ executive director of insights. “There’s still a long road to recovery ahead, but May auto sales are a really encouraging sign for the industry. The unprecedented deals broadcast by automakers and dealers really did the trick in getting more consumers to reenter the market, social distancing and all.”

Edmunds experts note that automakers have already begun to dial back some of the more generous financing incentives made available at the start of the crisis; consumer demand continues to grow and inventory could begin to dwindle as auto manufacturers work on getting their factories safely and consistently up and running.

“The best car shopping deals of the summer are happening right now and they’re not going to last,” said Caldwell. “If you’re in the market for a new car, now is the time to pull the trigger. Once automakers start to pump the brakes on their incentive spending, many cash-strapped Americans will be left in the lurch.”

SALES VOLUME FORECAST, BY MANUFACTURER

Edmunds estimates that retail SAAR will come in at 10.2 million vehicles in May 2020, with fleet transactions accounting for 13.5% of total sales.

MARKET SHARE FORECAST, BY MANUFACTURER

Virtual Estimates with Photo Tech Increasing

CCC Information Services Inc. (CCC) reports today that photo estimates and AI-supported claims have expanded at a record pace exceeding double-digit growth since the beginning of the year. The rapid adoption of digital technology is in direct response to social distancing and work-from-home protocols initiated to combat COVID-19.

Industry Adoption of Photo Estimates Increase

CCC industry data shows that the insurance industry recently surpassed 3 million estimates initiated leveraging photo technology, since tracking began in 2018. The company also reports that the percentage of claims processed through CCC® Quick Estimate, the company’s mobile photo estimating solution, has more than doubled from January to April of 2020 as carriers are accelerating use and adoption of digital tools in response to COVID-19.

“Industry use of photos for method of inspection has been growing and insurers are seeing benefit to both cycle time and customer satisfaction,” said Susanna Gotsch, director, industry analyst, CCC. “The recent spike is likely indicative of a new normal as we’re seeing greater use of digital by carriers that have been in market and new insurers coming online with digital solutions.”

AI-Supported Claims Increase

CCC also reports a similar trend in estimates written using CCC® Smart Estimate, the world’s first AI-guided estimating solution. Smart Estimate applies AI and estimating logic to photos captured with Quick Estimate.

Added Jason Verlen, senior vice president, product management, CCC: “Use of AI-supported claims has accelerated from steady adoption by industry leaders to a massive increase in use and adoption by the industry at large. Our data, and the conversations we are having with customers, strongly suggests that this point in time will mark a digital revolution in claims. We’re seeing every industry embracing new technologies, rethinking how they work, and focusing on personalizing experiences for their customers. The insurance industry is no different.”

CCC offers the industry’s only end-to-end digital auto insurance experience, from telematics data used by insurers for policy quotes and premium discounts, to incident management, where telematics can be used to alert an insurance carrier after a crash event, to photo- and AI-powered applications for repair, total loss, and casualty claims management. Using mobile, AI, and IoT together with its industry platform, CCC connects the broader auto insurance ecosystem supporting more than $100 billion in transactions each year.

Making Its Own Masks PSA

The sanitary crisis has led PSA Group to deploy a protocol of reinforced health measures at each of its sites to protect its employees. This protocol provides in particular for the distribution of two to four masks per day per employee.

To support the implementation of this protocol, the Group has decided to be autonomous by producing masks in France from August 2020.

Machines are manufactured by a French company on the national territory. Production will be organized in two concomitant phases:

• From August 2020, an automated line will be implemented on the Mulhouse site and a dozen Group employees will be dedicated to the production of masks.
  In parallel, a second automated line will be put into operation at our French partner, which will produce masks for the Group and will continue this production for a year.
• From August 2021, this second line will be transferred to Mulhouse and the Group’s teams will, in this scenario, ensure all of the production.

Ultimately, 10 million masks could be produced monthly in Mulhouse, for the protection of Group employees and organizations fighting against the virus and exclusion.

Speeding Not Slowing Down During Pandemic

QuoteWizard®, a LendingTree company, and one of the nation’s leading online insurance marketplaces released a report analyzing which states have the speediest and most accident-prone drivers to see where roads could be most dangerous during COVID-19 stay-at-home orders.

Fewer drivers on the road traveling less miles are leading to a drastic drop in car accidents. However, evidence suggests roads are becoming more deadly during the COVID-19 with an increase of 14% in fatalities per mile driven.

Key Findings:

• The National Safety Council found that vehicle fatalities per mile driven increased by 14% compared to March 2019.
• Consumer Federation of America estimates a 50% drop in insurance claims during stay-at-home orders.
• Open roads are leading to an over 50% increase in highway speeding, making roads more lethal during stay-at-home orders.
• QuoteWizard data shows Maine, California and South Carolina are the most accident-prone drivers in the country.
• Hawaii, South Carolina and Delaware are considered to be the most lead-footed drivers in the country.

Methodology

To determine the states with the most dangerous roads, we analyzed driver history from insurance quote data to see which states are the most accident-prone and which states are most lead-footed. Rankings determine the top 25 states with the highest rates of car accidents (accident-prone) and highest rates of speeding tickets (lead-footed).

Most accident-prone states

Most lead-footed states

Contactless Parking for Colorado Springs

The City of Colorado Springs Parking Enterprise and ParkMobile have announced a new partnership to provide contactless payments via mobile app at approximately 2,400 metered parking spaces throughout the City of Colorado Springs.

In the face of the COVID-19 pandemic, Kia Motors is supporting customers and communities around the world in the fight against the virus.

Kia recognizes the sacrifices made by healthcare professionals and volunteers globally, and is providing fleets of vehicles to frontline personnel to facilitate mobility at a time when they need it most.

The company is also working closely with governments to support communities and organizations on the front line to counteract COVID-19, in the form of financial donations and provision of medical and personal protection equipment.

Kia has also established a range of national and international after service programs to offer peace of mind to customers who may be facing financial strains or mobility restrictions during this time.

Finally, the company has introduced a range of measures to create a safe working environment for its employees in all regions to ensure their health and safety throughout this time.

Our efforts around the world

Global

• ‘Kia Promise’ global warranty and service interval extension program
• Payment deferral program*
• Digital showroom and online booking*
• Free vehicle disinfection service*
• Building disinfection and provision of personal sanitation items*
• Employee blood drive and fundraising*

Cleaning Making a Comeback

Ziebart, a 60-year-old car care provider with 400 locations and 1,200 service centers across the world, has received confirmation from appropriate federal agencies that its Disinfecting Interior Detailing Service kills coronavirus, including Covid-19, plus 99% of other germs and bacteria.

The news comes just as states begin to loosen restrictions and car usage begins to rise. As a result, the company is reporting increased inquiries about vehicle disinfecting – particularly regarding killing coronavirus.

“Now that many municipalities are beginning to gradually re-open previously non-essential businesses, consumers are driving more places and realizing their cars can be a connector of germs between public places and their homes,” said Edmund Russell, Director of Product Development & Technical Support for Ziebart. “We are receiving more requests and inquiries on how to disinfect their vehicles and kill coronavirus.”

Russell says the company is now suggesting, at minimum, bi-annual Disinfecting Interior Detailing services for all vehicles. In addition, between professional services, Ziebart recommends the following DIY car sanitization tips:

DO

• After leaving the grocery store, place your mask in a paper bag before putting it on your car seat.
• Similarly, remove your gloves and place them in a bag before entering the vehicle. Throw the bag with the gloves away when you get home.
• Placing your mask and gloves in a bag before entering your vehicle prevents any germs from the store, which are now on the gloves/mask, from being transferred to the car.
• Carry anti-bacterial wipes to disinfect high-touch areas inside and outside your vehicle, such as the steering wheel, door handles (interior and exterior), door latches, lock buttons, radio and climate control buttons and seat belts.
• To reduce damage, use an alcohol swab to clean touch screen radios/GPS systems in the car.

DON’T:

• Don’t place used gloves and masks on the seats in the car after leaving the grocery store.
• Don’t throw used plastic gloves on the ground outside of the grocery store.
• Never spray any liquid chemicals on electronic devices in the car – this can severely damage them and lead to a high cost to repair
• Don’t use bleach or hydrogen peroxide to clean – this can damage surfaces.

The Travelers Companies, Inc.  announced it is extending its Stay-at-Home Auto Premium Credit Program, giving its U.S. personal auto insurance customers a 15% credit on their June premiums. The company is already providing its customers with a credit on their April and May premiums under the program. Customers’ accounts will continue to be automatically credited, providing some measure of relief during this time.

“We have been evaluating our various COVID-19 relief programs in an effort to determine how we can best support our customers, agents, brokers and communities,” said Alan Schnitzer, Chairman and Chief Executive Officer of Travelers. “Our data suggests that the trend of fewer miles driven in April and May is likely to continue through June, and we’re pleased to provide an additional credit to customers. As cities and states begin to lift restrictions, we’ll continue to closely monitor the environment to understand the impact on driving behaviors and claims.”

The company is working with regulators to obtain all the necessary approvals.

Travelers continues to provide auto coverage for customers across the country whose job responsibilities now include using their personal vehicles to make food, grocery, pharmacy and medical supply deliveries.

The Stay-at-Home Auto Premium Credit Program adds to the company’s COVID-19 response initiatives. Among other things, Travelers is offering billing relief to customers, is accelerating more than $100 million in commission payments to eligible agents and brokers and has pledged $5 million to assist families and communities affected by the COVID-19 pandemic across North America, the United Kingdom and the Republic of Ireland. The company also continues to work with individuals experiencing financial hardships to offer solutions based on their unique circumstances.