BLOOMFIELD HILLS, Mich. — Penske Automotive Group estimated the business impact from superstorm Sandy would be hefty. The company’s 36 dealerships along the East Coast were impacted by the storm and lost, on average, three to four days of business, with the dealerships in the New York metropolitan area expected to suffer a more prolonged impact.
The most severe impact was felt in Jersey City, N.J., where three of the Penske’s dealerships sustained damage from flooding, including the loss of approximately 1,000 new and used vehicles in inventory. Power was restored to those dealerships on Nov. 6, and the dealerships have re-opened since.
“Our first priority continues to be the personal well-being of our employees and their families, some of which have suffered enormous hardship,” Penske Chairman Roger Penske. “We have established a donation program through the American Red Cross whereby all of our employees can contribute directly to the relief efforts and, as a company, we are directly assisting employees who suffered storm-related losses.”
Although the ultimate amount of losses are difficult to predict, the company currently estimates that storm-related losses and expenses, including insurance deductibles, are estimated to represent $0.02 to $0.03 per share during the three months ended Dec. 31, 2012, before potential benefits from business interruption insurance.
The dealerships in the eastern U.S. accounted for approximately 17 percent of the company’s retail unit sales and consolidated revenues for the three months ended Sept. 30.