Hurricane Harvey which has devastated large parts of Houston, North America’s fourth largest state and second largest market for auto sales has not only destroyed properties and businesses but is also expected to set a record for cars destroyed by floodwaters. Observers estimate that roughly the total financial damages could be higher than Hurricane Sandy and Katrina combined.
When Hurricane Sandy landed in a region in a higher population density area, it flooded and damaged close to 250,000 vehicles. This is because New York City has a much lower rate of car ownership than Houston. Harvey is expected to at least double the number total loss vehicles.
Texas is the domestic auto industry’s second-largest market in the US after California. Auto production in the state — led by General Motors Co. in Arlington and Toyota Motor Corp. in San Antonio — appears to have avoided major interruptions.
However, the immediate impact is being felt by dealers, many of whom have shut down operations temporarily. The full extent of damage to their properties and inventory will be only known after the flood waters recede and normalcy returns.
Such natural disasters also invite unscrupulous entities who will buy salvage cars and resell them to gullible customers with clear titles. After Hurricane Katrina a few years ago, many flood damaged luxury and premium cars ended up in the Middle East which were refurbished and sold to customers.