Olympia car dealerships embrace a COVID-19 future, as showroom sales resume
For more than a month, car dealerships throughout the state could only sell to essential workers, or those who had totaled their vehicles.
The result was a precipitous drop in sales. For the year-over-year period ending in late March and April, sales fell more than 50 percent in the state, said Vicki Fabre, executive vice president of the Washington State Auto Dealers Association.
Some dealerships have been hit harder than others, according to the state Employment Security Department.
Lee Johnson Auto Family, which has locations in Everett, Monroe and Kirkland, announced 169 temporary layoffs on March 30, according to a worker adjustment and retraining notification released by the state. The state requires notification when there’s a mass layoff.
And it’s a concern beyond affected workers. The city of Olympia typically receives about $3 million in sales tax revenue a year from auto-related services, including new and used car sales, said City Manager Jay Burney.
But now the fog is clearing on windshields after Gov. Jay Inslee announced May 6 that dealers could resume showroom sales if they follow state guidelines.
Just don’t expect a handshake when you walk through the doors. In fact, be prepared for social distancing, masks, gloves, plastic barriers, sanitizing and other steps the dealers must follow to prevent the spread of COVID-19.
It also extends to the employees, said Mullinax Ford General Manager Zach Dodge. He said the dealership at the Olympia Auto Mall in west Olympia is taking employee temperatures, and anyone who registers slightly above 100 degrees will be sent home, he said.
And they’re getting creative, Dodge said.
If a customer has a trade-in vehicle that needs a test drive, they can wrap the smart key in a plastic bag, or if it’s an older, metal key, that key can be poked through the plastic to start the car. And once they’re done, the key can be handed back to the owner in the bag, he said.
Although dealer sales were limited last month, that didn’t stop the phone from ringing at Mullinax Ford. At one point, Dodge found himself fielding call after call. He took deposits and got the buyers set up for when sales could resume.
“Business has been OK,” he said. Ford has rolled out some incentives, such as zero percent financing for 72 months or 84 months, depending on whether it’s a 2019 or 2020 model.
Other dealers are offering customer incentives such as payment deferrals, said Robert Pehl, vice president of I-5 Cars, which has a large base of operations in Lewis County, but also runs Volkswagen of Olympia at the Olympia Auto Mall.
“Customer traffic has improved,” said Pehl, who joined his mother’s business in 2016 after a professional baseball stint in the Kansas City Royals’ farm system. “It’s not back to a total normal state, but it’s encouraging.”
Like Mullinax Ford, I-5 Cars is practicing social distancing and taking other steps the state outlined to prevent the spread of COVID-19. Pehl said they are asking customers to wear masks, and also are asking them to sign a log in sheet, so they can keep track of them in the event anyone at the dealership gets sick.
Who is buying cars these days? Pehl said some customers are looking for a lower monthly payment than they have, while others simply need to replace an older vehicle.
“The franchise model of selling cars has endured for over 100 years because dealers have had to adapt to changing times and conditions,” said Fabre of the Washington State Auto Dealers Association.
“They will do the same as we move through the phases of the COVID-19 crisis,” she said.
This story was originally published May 17, 2020 at 5:45 AM.
