Welcome to the Daily 5 report for Wednesday, Feb. 26.
The recent Los Angeles wildfires torched thousands of vehicles, homes and buildings — and killed 29 people. While the cost of the disaster is still being totaled, used-car buyers in the West already are paying the price.
This story today by C.J. Moore says the wildfires destroyed an estimated 6,300 vehicles in the L.A. area, according to Carfax. This created a surge in demand for replacements and probably contributed to February used-vehicle retail price increases in California and other states in the West, Patrick Olsen, editor-in-chief of Carfax, said in our story.
The average retail price for pickups, for example, rose $400 in February in the West, Moore wrote. Nationally, the average price of a pickup fell $350 in the month, Olsen said. Not all of that is attributable to the wildfires, but prices go up in situations of reduced inventory and increased demand — both of which happened in Southern California, Olsen told Automotive News.
Back in Washington, auto dealers hoping for a kinder, gentler Federal Trade Commission might want to read this story by John Huetter analyzing Chair Andrew Ferguson's history with the agency. It suggests the FTC still might bring actions against dealerships for practices such as misleading consumers about prices or finance and insurance products.
Ferguson's votes and writings as commissioner, as well as analyses by auto retail industry attorneys, offer a sense of how the FTC might act under its new Republican leader following three and a half years with Democratic former Chair Lina Khan, Huetter wrote.
"I think it would be an error for those in the auto industry to assume that Ferguson is just going to kind of turn a blind eye to anything that's going on," Brooke Conkle, a partner at the Richmond, Va., office of the Troutman Pepper Locke law firm, told Automotive News. "His opinions have shown that he is a proponent of law and order; he just wants that law and order to be clear."
In Detroit, General Motors' aggressive 25 percent boost in its dividend, paired with a new $6 billion stock buyback plan, got a lukewarm response from investors. Shares in GM rose 3.75 percent to close today at $48.46.
Meanwhile, Volvo touted some eye-opening numbers for its electric ES90 sedan, according to our story today by Douglas A. Bolduc of Automotive News Europe. Volvo says the ES90 will have a driving range of up to 435 miles under the WLTP testing cycle — and it will take significantly less time to recharge.
"For the first time, we can charge the car from 10 to 80 percent in just 20 minutes, using a 350-kilowatt fast-charging station," Simone Vizzini, Volvo's technology manager for battery systems and cells, told the Automotive News sibling.
That's the kind of charging time that will get EV-skeptical buyers' attention.
Look for a story Thursday from our retail team about a well-financed new player entering the dealership acquisition market in Texas.
That's it for today. Have a great rest of your day.
If you want to view this story in your browser, click here.
— Philip Nussel, online editor
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