Auto salvage auction companies, insurance companies and automakers last week began the massive task of evaluating the damage caused when Hurricane Charley slammed Florida.
At least 6,700 new vehicles were damaged or destroyed when the storm struck Aug. 13. About 300 new-car dealerships are in the eight counties that were hit hardest. Dealerships on the state's west side saw the worst damage.
Florida is an important sales state, ranking third in new-vehicle registrations, so Charley might affect monthly sales.
"It could weaken the August sales report," warned George Pipas, Ford Motor Co.'s sales analysis and reporting manager.
The Palm Automotive Group of dealerships in Punta Gorda, Fla., said as many as 700 new vehicles were damaged so badly that they cannot be sold.
Ford had about 700 vehicles in the southwest part of the state that were heavily damaged, said Frank Rodriguez, chairman of Ford's national dealer council.
Vinnie Mitz, senior vice president of marketing at Copart Inc., said the salvage auction company expects to handle as many as 5,000 storm-damaged vehicles during the next 90 days. He said Copart found a piece of land in Fort Myers, Fla., the day the hurricane hit and has set up a makeshift auction to handle its storm business.
Patrick Walsh, COO at salvage vehicle company ADESA Impact, said some of his company's auctions already had accepted damaged vehicles. More are expected in coming weeks.
ADESA Impact has salvage auction sites in Miami, Orlando and Jacksonville. Employees at the Orlando site were to work over the weekend to handle damaged vehicles.
"The insurance companies are all settling claims seven days a week in a situation like this," Walsh said. "We really have to match up with them."
Tony Long, president of the National Auto Auction Association, conceded that while 43 states have title branding laws, damaged vehicles eventually could wind up at dealer-only auctions. Some dealers, he said, could make repairs and sell vehicles to consumers without disclosing that insurance companies had written them off.
Another danger of damaged vehicles reaching consumers comes from unlicensed dealers often called "curbstoners." These dealers buy vehicles at salvage auctions. They then make quick cosmetic repairs and sell them in other states with clean titles.
Larry Gamache, a spokesman for Carfax Inc., which provides title information, said: "There are entrepreneurial souls out there who seem to delight in cheating the system."