Steve Bonner has owned his Dodge, Chrysler and Jeep dealership in New Orleans for barely five months. Hurricane Katrina wrecked it in a few hours.
"This dealership is still under about five feet of water, black sludge," Bonner told Automotive News last week. "I'm about to get hepatitis and tetanus shots. The garage doors were blown off, some wind damage to the roof. You can't even get an (insurance) adjuster in. It's going to be a tough road."
But Bonner insists he and his partners "can get the dealership back in order." Three weeks after the hurricane laid waste to broad swaths of Louisiana and Mississippi, Bonner's optimism echoes that of other dealers in the storm-devastated region who insist they will overcome obstacles and rebuild.
Robert Israel, executive vice president of the Louisiana Automobile Dealers Association, says about 60 dealerships in his state that were severely damaged by the storm remain closed. Nearly all are in the New Orleans metropolitan area.
Roughly 18,000 vehicles on Louisiana dealers' lots were destroyed, Israel says. About 3,400 dealership employees in the state are out of work, he adds.
Israel notes that dealers in the New Orleans market face the ordeal of rebuilding in an area whose population has plunged from more than 1.2 million to less than 50,000. Still, he says the dealers he talks to are eager to get on with the task.
"It's absolutely remarkable how resilient and tough these dealers are," he says. "So far, I've not had one say: 'I've thrown up my hands; I'm out of here.' Every single one will be open for business the moment they're able to be, they're allowed to be."
Last week, Mississippi Automobile Dealers Association President Bill Lehman visited about 32 dealerships in seven counties that have been declared part of the federal disaster area.
"Along the Mississippi Gulf Coast, in two counties I visited, almost all of the dealerships are operational to some extent," Lehman says. "There's a lot of damage."
Inspecting hurricane damage at Lakeshore Chrysler-Dodge-Jeep in Slidell, La., are, from left: Chrysler group executives Gary Dilts and Joe Eberhardt; dealer principal Otis Favre; Michael Manley, Chrysler group vice president of dealer operations; and William Jones, vice president of Chrysler Financial. PHOTO: KEVIN McCORMICK
Automakers are taking steps to help dealers rebuild their inventories and facilities.
The Chrysler group has sent trailers, generators and laptop computers to help dealers in storm-battered areas open at temporary locations, says Joe Eberhardt, the company's executive vice president of global sales, marketing and service. Chrysler is restocking dealerships with new inventory, he says.
"We want to cut through all the bureaucracy and make decisions right there at the location," Eberhardt told Automotive News at the Frankfurt auto show last week.
Chrysler is creating a "multimillion-dollar" fund for direct dealer relief, says Gary Dilts, the company's senior vice president of sales. The company also is helping employees displaced by the hurricane find jobs at other dealerships.
Katrina destroyed about 4,500 new vehicles at 45 Chrysler group dealerships, Eberhardt says. Those stores account for about 1 percent of the company's U.S. sales, he adds. Ten of the dealerships were destroyed.
Eberhardt and Dilts went to Louisiana and Mississippi this month to tour damaged dealerships. Both praised the resilience of the dealers they met.
"It was amazing to see the spirit of the dealers, as bad as they got hit," Eberhardt says. "They kick into gear."
Adds Dilts: "We saw dealers shoveling mud out of their showroom."
Some dealers whose stores were battered by Katrina have expressed interest in reopening elsewhere in the vicinity, Eberhardt says. But none plans to get out of the business, he adds.
General Motors Acceptance Corp. has received about 100 damage claims from dealers in the path of the storm, says GMAC spokesman Mike Stoller. As many as 11,000 vehicles on GM dealers' lots were damaged, he says.
Late last week, GM still had not made contact with 16 of its dealerships in the New Orleans area, Stoller adds.
GMAC is deferring payments of wholesale floorplan interest charges for dealers in the storm area for 60 days, Stoller says. It is waiving charges on destroyed inventory until those dealers get insurance settlements, he says.
Ford Motor Credit Co. also is waiving interest payments on destroyed vehicles by the flood-damaged dealerships it floorplans, says spokeswoman Meredith Libbey. The company is deferring other dealership interest payments case by case, she adds.
Libbey said she could not estimate how many Ford Motor Co. dealerships, or vehicles on their lots, were damaged or destroyed by the hurricane.
Two Toyota dealerships in the New Orleans area remain under water, says Toyota Financial Services spokeswoman Kelly Rivera. "A lot of dealers did a great job mitigating damage," Rivera says. "They moved inventory to multilevel garages and boarded up windows."
Dealer Robert Weinmann owns a Ford dealership in New Orleans and two Chrysler group stores in Mississippi that were hit by the hurricane. The Ford store has resumed selling vehicles, he says.
"There's a huge need here," Weinmann says. "We're here to get people back in business. Whatever I have to do, I'm going to do it."
- Donna Harris contributed to this story.