Automotive Industry Adapts to Preserve Jobs and Drive Sales

We have faced big challenges this past 8 months, but have worked remarkably hard to turn our economy around. Since March, we have seen our community support one another by looking local for the everyday essentials, creating a positive outcome for our local economy. Our local automotive industry has quietly kept us on path generating 25 percent of the overall sales tax income, the highest sales tax generator for the City. The auto industry has quickly adapted to the new health and safety standards and since July, has made huge efforts to turn things around for themselves, and subsequently our community. If you’re looking to purchase a car, look no further than your neighborhood.

When looking to buy a car, Santa Monica residents know to head down to Santa Monica Blvd., housing over 20 auto dealerships and 30 plus car repair services. The Boulevard has historically been a hot spot for auto services, with some dealerships dating back to the 1950’s, such as Santa Monica Ford Lincoln. 70 years later, Santa Monica’s auto industry continues to adapt. The popularity of electric and hybrid vehicles are surging, and computerized systems in vehicles are already setting the standard. Today, there are 151 City-owned electric vehicle charging stations available to the public, while California is phasing out gas powered passenger and transport cars in favor of zero-emission vehicles by 2035. As the automotive industry moves towards the future, Santa Monica is leading the way and vehicle purchases have the power to reinvigorate our economy at the same time.

The March shutdowns hit every sector of our community, but most notably the automotive industry. What was once the highest sales tax generator for the City took a steep dive, with a 26% decrease in City tax revenue out of an overall 34%, according to Santa Monica’s second quarter tax update. As the months went on, the automotive industry implemented some innovative changes to adapt to our new climate, and sales recovered by August. Many dealerships have begun pushing online sales, choosing to conduct minor repair services at a client’s home without interaction, no-touch pay options and much more. Although the car buying experience might be a little different this year, auto dealerships are still offering their impeccable customer service and are predicting a great holiday season.

Gary Schneider, General Manager of Santa Monica Ford Lincoln has made the best out of his current situation. In the early stages of the pandemic, Schneider was able to keep Ford Lincoln’s doors open and about 20% of his staff employed. Since then, Schneider has been able to turn things around, returning to near “pre-COVID level staffing” by early June.

Over the course of time, Schneider quickly implemented strategic changes to the car-buying experience, making it a COVID-19 friendly environment for staff and clients. Schneider “moved into digital marketing” and began providing home-deliveries. For those in need of basic maintenance, such as oil changes or recall maintenance, a technician is able to perform these services at your home while you pay online or through text, for a no-contact experience. Schneider says that people “like the model” for its convenience and is a great way to promote business, as well as keeping demand up to employ his staff. As business began to surge once again in July and August, Schneider says that used cars and car leases are what’s selling, leading to a high surge in used car prices over the summer.

As for the future of the business, Schneider is confident that demand will continue to increase into the holidays, as Ford is releasing an electric Mustang and re-introducing the notorious Ford Bronco. As for buying local, Schneider says that it’s “important” to buy local because “any money spent in Santa Monica will stay here,” funding public services like our fire department and public schools.

“Buying local keeps our essential services running. Santa Monica businesses fund over $160 million toward our parks, libraries, and public safety,” says Jennifer Taylor, City of Santa Monica’s Economic Development Manager.

Native Santa Monica resident, Mike “Sully” Sullivan, better known as the LA Car Guy, has been in the Santa Monica auto-business since opening Santa Monica Volkswagen in 1964. 56-years later, Sullivan now owns four other dealerships in Santa Monica, including Honda, Toyota, Lexus and Subaru. His friendly business model has attracted Santa Monica residents for years, but in March, Sullivan closed his dealerships in an effort to keep his staff and clients safe. After a four-week closure, he was able to open again in May, when tragedy struck again; Sullivan’s Toyota dealership was looted and vandalized during the riots. During the subsequent clean up, Sullivan was touched by the community that “came out to help,” says Sullivan. Since reopening, Sullivan says that “business has been dramatically better” with the top-sellers being pick-up trucks and SUVs for those weekend warriors looking for a COVID-friendly adventure. He also noted that the sale of luxury vehicles has decreased. As he continues to navigate this new landscape, he is confident that the auto industry will continue to support Santa Monica’s economy and that “Santa Monica will come back.”

In the world of change we are living in, a little normalcy can be refreshing. At Mini of Santa Monica, General Manager Seth Waskow is still providing the best and safest customer experience possible.

Waskow shared the same sentiments as many other dealerships, that March was an extremely difficult time. Waskow evaluated the best course of action and decided to temporarily close his doors for the safety of his staff in mid-March. To ensure that the dealership would be well prepared for re-opening, and with safety measures in place, including shorter hours and appointment-only service, they reopened on May 1st. As of today, Waskow has been able to increase hours to near pre-COVID levels because of the increase in demand. After a lull in sales from March to early June, Waskow says that they experienced a “kick” in July and by August, they have been experiencing “some of the best months we’ve ever had.”

Although larger auto-dealers are riding on a high, many independent dealerships are still experiencing economic strife. Grant Woods owns Cars with Class on Airport Ave. next to the Barker Hanger by the Santa Monica Airport, and he focuses on the sale of classic cars. Since the shutdown he has struggled to bring back the business he once had. He attributes most of his sales and inquiries from patrons out of state (who find him online), but believes that local sales will increase once people see the “good investment” potential of classic cars.

As we near the end of 2020, with the holiday season quickly approaching, it is more important than ever to look locally for any car buying needs. Interest rates are at an all time low and you are supporting the largest sales tax revenue service in the City. The car-buying experience is safe and easy and you can also take advantage of contactless maintenance for a vehicle you already own. Take a trip down Santa Monica Blvd. and talk to a friendly sales representative to see if now might be the time to purchase a car and feel good knowing that you played a role in supporting your local economy.

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