Janet Martin-Clark, dealer principal at Martin Chevrolet-Buick-GMC in Cleveland, Texas, said she’ll be taking advantage of the Paycheck Protection Program because of the loan forgiveness.
“But, frankly, I’m a little concerned by the sheer amount of people that’s going to be applying for these loans,” she said. “This isn’t normal. Where am I going to be in the queue? How long is this going to take?”
Chris Reeves, general manager at University Mazda in Seattle, is waiting for legal and tax advice from accountants with dealership clients, but he said the loan program will provide relief to employees and businesses that are incurring massive fixed operational expenses.
“We’ve gone to a nearly zero revenue funnel,” he said. “My service is down 75 percent. My sales business is shut down, but I still have the same fixed expenses that don’t fluctuate every month.”
Certain requirements of the process still need to be refined, with numerous instances within the crisis-oriented legislation stating the Department of Treasury “shall issue further guidance,” said Buddy Dearman, managing partner for DHG Dealerships at accounting firm Dixon Hughes Goodman.
“They pulled this bill together in a really quick amount of time, so there will be further guidance on some of the more delicate nuances in the details and some of these calculations as we go forward,” he said.
His advice for dealers in the meantime?
“Determine how much you can borrow, and borrow as much as you can borrow in accordance with the terms of the program,” he said.
