How British Columbia Floods Affect New Vehicle Inventory Flow

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Already hit by inventory and parts shortages, B.C. auto dealers are now grappling with being cut off from the rest of the country due to recent widespread flooding in the southwestern part of the province.

Automakers have also been affected, as all major roads connecting the Vancouver area and the Port of Vancouver to the rest of Canada have been cut in several places by landslides. The province said Highway 5, Coquihalla’s most frequently used commercial transportation highway, was scheduled to open Dec. 20 to commercial traffic. Much of the Trans-Canada Highway is expected to remain closed for some time. Highway 3 is open to essential traffic only.

Most dealers in affected areas avoided flood damage, said Blair Qualey, president of the New Car Dealers Association of BC.

MORE CHALLENGES FOR DEALERS

Murray Chevrolet-Buick-GMC, a few blocks from the flood zone in the town of Merritt, in central British Columbia, was forced to temporarily close under an evacuation order imposed on November 15 . Several other dealers were affected as staff were unable to reach their places of work.

“The biggest challenge has been access for their employees and also for their customers,” said Qualey, whose association represents more than 390 franchised dealers.

Richard Antonenko, general manager of Murray Chevrolet-Buick-GMC, said he was cleared to return to the dealership on November 29 and all staff returned on December 7. But his store was only able to offer limited service to customers due to the supply of parts. is rare.

General Motors, he said, “worked really hard on the logistics” to get the parts to the dealerships.

New vehicles are also rare.

Antonenko normally has 50-60 new vehicles in stock, but at the start of December he only had eight. Transport trucks were unable to pass from the Port of Vancouver, where vehicles destined for the concession are stranded.

And with a shortage of new vehicles everywhere, “There is hardly any dealer business,” Antonenko said.

Six customers who lost vehicles in the flooding are awaiting replacement, but Antonenko believes this is just the tip of the iceberg as many people have yet to book their losses.

“You add these transportation issues to the supply chain issues our dealers face, it makes it particularly difficult,” said Qualey. “It has been incredibly disturbing. “

Some automakers have reported to Automotive News Canada that the flooding – in addition to existing inventory issues – caused significant declines in November sales. Mazda fell almost 47 percent while Kia was down 34 percent.

PORT SAFEGUARDS, LONGER WAITS

The disaster “added costs and delays to getting the two parts to production facilities and to vehicles in the retail distribution network in Canada,” said David Adams, president of Global Automakers of Canada, which represents non-domestic brands. .

“For our members, many bring vehicles from the West Coast for distribution across Canada. Safeguards at the Port of Vancouver mean dealers have to wait even longer for vehicles in an already limited inventory environment, ranging from an additional 10 days to two weeks. While the vast majority of auto parts supplied to Honda and Toyota assembly plants in Ontario come from North America, some are imported from overseas and the port situation has added costs, Adams said. Honda and Toyota “are dealing with supply chain disruptions but face rising costs as they find other ways to get parts to their factories,” although production has not been affected.

SHAKED SUPPLY CHAIN

Brian Kingston, president of the Canadian Vehicle Manufacturers’ Association, which represents the three Detroit automakers in Canada, said the auto industry had not seen significant impact immediately.

“However, given the highly integrated automotive supply chains in Canada and across North America, prolonged road and rail closures could pose problems in the coming weeks,” he said. .

Toyota Canada spokesperson Philippe Crowe said the automaker has quickly adapted to the ever-changing situation in British Columbia.

“Our teams are monitoring closely and our main goal is the well-being and safety of everyone affected, including Toyota employees and all affected citizens,” he said. “We are not in a position at this stage to comment on the impacts on the business.”

To save weeks of shipping time, Volvo Car Canada recently changed the transport route of its XC60 midsize crossover and S90 luxury sedan – the brand’s two Chinese-built models – to the Port of Vancouver from Halifax. Deliveries were affected by the flooding, said Paul Valentine, general manager of Calgary-based Valentine Volvo.

“These cars are delayed, and no news [estimated time of arrival] has been shared with us, ”he told Automotive News Canada in a Dec. 2 interview. He was told that Volvo officials expected the delay to be short-lived.

“We think it will only be in a week or two.”

FIRST FIRES, NOW FLOOD

The latest disaster follows wildfires that swept through British Columbia over the summer.

“First there were fires; now there is the flooding, ”Qualey said. “It’s just relentless.”

British Columbia Premier John Horgan declared a state of emergency across the province on November 17 amid the crisis, which sparked landslides that killed at least four people.

Some transport trucks carrying vehicles were banned from accessing highways, which were limited to essential services only, Qualey said. The British Columbia Dealers Association was in contact with the provincial Ministry of Transportation to try to ensure vehicle deliveries were authorized, he said.


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