The Canadian Automobile Dealers Association (CADA) is pleading with the government to speed up financial assistance as the ongoing coronavirus impacts business.
In a statement published on the group’s website, CADA economist Oumar Dicko said Canadian car dealerships are having difficulties staying afloat while keeping staff employed and said that economic assistance is needed immediately.
“Access to support in three to four weeks may be too late for some of the businesses. It may not have the intended effect the government is trying to do for the economy,” Dicko wrote.
The Canadian government has announced an $82 billion (US$56.5 billion) financial package to support individuals and businesses impacted by the Covid-19 pandemic. Dicko fears that delays in getting the financial support out to car dealerships could force some to collapse.
“COVID-19 is a serious health crisis, but it is also having a devastating economic impact,” he wrote. “Many sectors of the economy will be hit hard, including the automotive sector and dealerships. At CADA we understand that. Our focus right now is to ensure long-term business continuity in the sector.”
Canadian Black Book (CBB) believes the lockdown of the country and strict social distancing policies could lead to a “mild recession” where consumer confidence will fall, unemployment will rise, and sales of new cars could plummet by 25 per cent this year to 1.44 million units. If a more severe recession hits Canada, new car sales may drop by 40 per cent to 1.15 million units, CBB claims.
Auto News reports that CADA wants to work with the government in the longer term on a plan to stimulate the economy once the crisis subsides.