When the recall of potentially explosive Takata airbags was expanded once again in late May to cover another 12 million vehicles in the U.S.—bringing the total to more than 40 million recalls to date and as many as 40 million more expected to be announced by 2019—Baton Rouge area auto dealers undoubtedly let out a collective groan.
As Business Report details in a feature from its current issue, the recall—now the largest in the history of the automotive industry—is having a big impact on local dealers.
Along with having to put potential sales on hold until back ordered replacement air bags can be installed, service shops are dealing with a maintenance backlog of cars and trucks. In the interim, some dealerships are having to put hundreds of customers with affected vehicles in rental vehicles—often for months—as they await for the replacement air bags.
Though the recall has affected the Big Three automakers and nearly a dozen others, no one has been more impacted than Honda. Approximately 8.5 million Honda and Acura, the luxury division of the company, vehicles have been included in the recall.
Preston Q=Petersen, general manager at Team Honda, the state’s largest Honda dealership, says it’s dealing with so called stop-sales of new and used vehicles as they await replacement air bags.
“Having those new vehicles under a stop-sale is a significant inconvenience,” he says, “but Honda is trying to do what’s right; they’re trying to be fair with us. We would much rather be able to sell them. We also have lots of certified used cars that have been on stop-sell until we get the parts available for them.”
Complicating matters, the inflator components in the replacement air bags are VIN specific, meaning Team Honda must distribute them based upon a prioritized list of vehicle identification numbers.
“So, it makes it a little more tedious when it comes to scheduling customers,” Q=Petersen says. He expects the backorder to continue through at least early next month, partly because Honda switched to a new supplier.
On the service side, Team Honda is offering to put any affected customer into a rental car while they wait on a replacement air bag—and preparing them for the possibility that it could be months before one arrives.
The situation has created a windfall of business for Enterprise Rent-A-Car, which has an agreement with Team Honda to handle all its rental vehicle needs for affected customers. An Enterprise spokeswoman says her company is equipped to handle the increase in demand nationwide.
Meanwhile, over at Southpoint Volkswagen, owner Bob Grace says the dealership is somewhat affected by the air bag recall—but what he’s really concerned about is the VW recall that was just announced in the wake of last year’s diesel emissions scandal.
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