MNN - Mother Nature Network

November car sales are coming in, and it’s lookin’ good—almost all brands are up, volume has increased 14 percent (122,565 vehicles) over the same month a year ago, and if present trends continue the industry numbers will reach 15.3 million for the year. November was the best auto sales month since the industry was hit hard by the recession in early 2008.

 

The industry has a reason to say, “Thank you, Hurricane Sandy.”

 

Of course it’s not actually going to say that—do you think auto executives are ghouls? But despite the enormous amounts of pain it inflicted, the storm is doing wonders for the car industry's bottom line. The hurricane caused $70 billion in damage and ruined an estimated 230,000 cars and trucks (some 190,000 of them in New York and New Jersey), reports the National Insurance Crime Bureau.

 

I’ve just come from a drive along my Connecticut town’s Beach Road, a narrow strip that’s a miniature version of New York’s Rockaways. One home was leaning almost into the water, and great berms of sand were everywhere. At one house, I saw a forlorn VW Golf that was sitting at a crazy angle, a victim of the storm that—even now—hadn’t been cleared away. My friend lives at the beach (that's her neighborhood at left) and the only reason her Acura is intact is because she got evacuated and was staying with me on higher ground.

 

We all know to avoid storm-damaged cars, and some of us have even read some tips about how to do that. One of the biggest results of Sandy, though, was an unexpected wave of sales to replace perfectly good cars irreparably damaged by flooding. “The post-Hurricane Sandy sales for November look quite strong for the auto industry,” says Cornell University extension expert Arthur Wheaton. “It is difficult to quantify the impact of the hurricane devastation, but auto sales in the region and the nation have been robust.”

 

It would be nice to quantify it, and in some cases, you can. General Motors passenger cars were up 19 percent in November, and Buick and Cadillac had their best Novembers since 2006 (Buick) and 2007 (Cadillac). But according to Kurt McNeil, vice president of U.S. sales operations at GM, just three percent of that increase is due to Sandy. Why? Because GM isn’t necessarily a strong brand in Sandy’s epicenter of the Northeast, where imports play a dominant role. “It benefited our competitors more than GM, since they rely on the region for more of their sales,” McNeil said.

 

Oddly, in October the opposite phenomenon occurred—lost sales because of the storm. Reports the New York Times, “Carmakers blamed Sandy, the huge storm that lashed the densely populated East Coast and caused up to $50 billion in damage, for the abrupt halt in sales last month.” Ford said the industry lost up to 25,000 sales in October, and Toyota said 30,000. Many sales interrupted in October were completed in November, hence the big jump.

 

What brands are particularly strong in New York and the Garden State? Honda and Toyota. And Honda’s sales bump in November is likely to top all other automakers—as much as 33 percent. It helps that Honda has double the inventory it had a year ago, when the company had trouble supplying its dealerships because of Japanese tsunamis and Thai flooding. Back then, it was the Big Three that were benefiting most because they had cars when others didn’t.

 

Edmunds.com Senior Analyst Jessica Caldwell told me, “We figured all along that Hurricane Sandy would have an effect on November sales, and Honda’s results are a prime example. Honda is the most popular brand in the tri-state area, so when life started to return to normal, those car buyers quickly made up for lost time. It was certainly a major factor—along with the continued success of the new Accord—that helped make last month Honda’s biggest November ever.”

 

Biggest November ever? Wow. And Toyota was in the money, too. It sold 161,695 cars, up 17.2 percent from the previous November. (Strong incentives certainly helped.) The Toyota models that are popular in the Northeast did especially well, including Camry (up 22.7 percent) and Corolla (up 40.3 percent). The Highlander and RAV4 made good showings.

 

Sandy will be just a bump for automakers. Ultimately, they have to have compelling products, which is why Lincoln is re-inventing its brand identity this week.

 

Here's a video look at typical vehicle flooding in New York City. This is East 8th Street and Avenue C: