How NADA mobilized as virus threat grew

As the first cases of the coronavirus were identified in Wuhan, China, in January and soon erupted elsewhere, the National Automobile Dealers Association turned its attention to Beijing, where many of the trade group's staff were scheduled to attend the Beijing Motor Show in late April.

But in February, the show was postponed. By this time, there were more than 71,000 confirmed cases of COVID-19 globally, with the U.S. reporting just 13 cases.

NADA, which like many others in the industry began tracking the virus early on, started looking at supply chain disruptions and other concerns from its dealer members and their automaker partners. But it wasn't until the end of February with the cancellation of the Geneva auto show that the association got its "first really big wake-up call," CEO Peter Welch said.

At that time, global cases rose to nearly 84,000, according to the World Health Organization. In the U.S., cases were at 16, the Centers for Disease Control and Prevention reported. "We knew it was coming," he told Automotive News. "We needed to get ready."

Since the onset of the coronavirus in China, NADA has been scrambling to readjust its organization internally while maintaining a presence on Capitol Hill and guiding dealers through an unprecedented and escalating economic and public health crisis, as stay-at-home orders and social distancing disrupt not only business operations, but also day-to-day activities and personal life.

On March 13, NADA issued a voluntary work-from-home policy. Days later, the trade group in Tysons, Va., made it mandatory.

Cases of COVID-19 are surging in Virginia, where the governor has issued a stay-at-home order as confirmed cases in the state rose above 2,000 as of Friday, April 3. Now, except for essential personnel within the information technology department and mailroom, most NADA employees are working from home.

In addition, all travel has been canceled to cut costs and keep employees safe, Welch said. Most, if not all, meetings have been rescheduled as discussions by phone or video. The association's education arm, NADA Academy, has suspended all classes through May.

Under normal circumstances, the NADA mission is to preserve and strengthen the franchise system and provide educational and compliance tools to its members so they can be financially successful and comply with state and federal laws.

With the pandemic, the trade group's mission has been reduced to "one very simple thing," Welch said: "Help our members and their employees weather the coronavirus storm and remain financially solvent through the crisis."

As part of that effort, NADA launched a coronavirus hub and webinar series that expand and speed communication with its members. Calls to the association are ballooning as dealers seek guidance on how to navigate the crisis and keep their businesses afloat, Welch said.

NADA also has been collaborating with automakers and other industry trade groups, including the Alliance for Automotive Innovation, the National Association of Minority Automobile Dealers and the American International Automobile Dealers Association, to ensure dealers and the auto sector are represented during the crisis.

Social distancing and stay-at-home orders have made it more challenging for NADA's regulatory and legislative affairs team as the coronavirus lockdown upends lobbying efforts on Capitol Hill.

"But this is where those long-term relations with staff members and key members of the committees really paid dividends," Welch said.

David Regan, NADA's executive vice president of legislative affairs, said the group started strategic sessions in mid-March to discuss what kind of relief dealerships would need. That led to a focus on dealership liquidity and, ultimately, making sure dealers are able to participate in the Small Business Administration's new Paycheck Protection Program in the $2.2 trillion coronavirus rescue package, he told Automotive News.

As well, on March 17, NADA and the alliance penned the first letter to President Donald Trump asking that dealership sales and service departments be deemed essential businesses and allowed to operate.

The two groups — this time adding AIADA, NAMAD and American Truck Dealers — sent another letter to the White House the next week, urging the president to clarify that certain sales and leasing activities at franchised dealerships are considered essential services during the coronavirus pandemic.

Andrew Koblenz, NADA's executive vice president of legal and regulatory affairs, said it has been an "all-hands-on-deck effort" as the association has worked around the clock on its advocacy approach in a month's time.

"I think, once again, NADA is rising to its finest and highest level of performance and demonstrating its value to members," Koblenz said.

The Department of Homeland Security's Cybersecurity and Infrastructure Security Agency, which issues guidance on essential services and essential critical infrastructure workers, has listed vehicle manufacturing, supply manufacturing, maintenance and repair facilities as essential services. The agency also added car rental and leasing employees to the updated guidance, but as of last week had not said whether vehicle sales were included.

"Needless to say, even in those jurisdictions that allow sales, the demand for vehicles has plummeted," Welch said.

Of all the things NADA is doing during the COVID-19 crisis, forecasting and tracking how long this may last, how severe the impact on the economy could be and what steps will need to be taken are among the most vital as dealers and the auto sector battle through the fog.

"We're going to have 50 different stories," Welch said of the rolling surges throughout the U.S., where the virus is spreading more rampantly in metro areas than in regions with sparser populations.

The association is looking to China, as well, for what vehicle demand — or the lack thereof — could look like on the other side of the outbreak.

Despite the unprecedented situation, NADA Chairman Rhett Ricart said the association is built for this type of crisis and is "not just an emergency pop-up tent."

"We've been here a long time, and we know how to handle these situations," he told Automotive News. "This one is different. It's more complex, but there is nothing that's not within our wheelhouse."