New Jersey Approves Limited Car Dealership Sales During COVID-19 Crisis

Car dealerships in New Jersey are now allowed to stay open during the coronavirus crisis as long as they adhere to a few guidelines.

On March 30, Gov. Phil Murphy issued Executive Order No. 107, which amended which businesses are permitted to operate and clarified how they’ll be able to stay open.

The directive approves dealers to conduct sales online or remotely, deliver vehicles directly to customers and arranging for curbside or service lane pickup at a dealership. Car repair and service centers previously only been allowed to stay open.

“While we’ve made adjustments to business that are permitted to operate, my stay-at-home order remains firmly in effect,” Murphy said. “Unless you absolutely need to get out, or unless your job is critical to our response, I have ordered all New Jerseyans to just stay home.”

Murphy has closed schools, banned social gatherings and ordered non-essential businesses until further notice. Officials vowed to prosecute those who violate the orders and Murphy has reiterated he’d impose additional restrictions.

‘Wreaked havoc’ on Businesses

Over the past week, state legislators and the automotive industry urged the governor to designate dealerships as essential, exempting them the types of closures or restrictions other businesses have faced.  And, with public transportation services scaled back, reliable personal vehicles are more important than ever, several lawmakers said.

Assemblyman Parker Space (R-Sussex) called the executive order a step in the right direction.

The coronavirus, Space said, “has wreaked havoc on local businesses as customers have stayed home or because the governor has shut it down to halt the disease’s spread.”

Provide for Customers

“We want to stop the spread of COVID-19, but at the same time we need to give businesses the opportunity to abide by social distancing protocols while still providing for customers, and most importantly their employees and New Jersey families,” he said.

Assemblyman Hal Wirths (R-Sussex), said, “I am confident that our car dealerships can limit interactions with customers who might have expiring leases or been in a car accident and need reliable transportation.”

Wirths recently said, “Our state would also benefit from the sales tax, one of our biggest sources of revenue.” Keeping dealerships open, the assemblyman said, helps New Jersey’s “businesses, residents and the budget.”

State Sales Tax

“Many of the purchases people can make right now are not subject to state sales tax, but vehicles certainly would be and people would have reliable transportation to access food and medical care. New Jersey car dealerships are losing business to other states that are permitted to sell vehicles, including Delaware and Maryland, and online car retailers that deliver purchases to people’s driveways,” Wirths said.

Several other lawmakers, including Senate President Steve Sweeney, Senator Vin Gopal and Senator Declan O’Scanlon supported allowing dealers to operate.

 Up until the governor’s announcement, New Jersey’s 510 car dealerships were in limbo, uncertain if they’d be shut down under any future restrictions by the state to help curb the spread of COVID-19.

Open For Business

Many remained open, but cut back on hours of operation, implemented social distancing rules, set up ways to conduct business online and arranged for test drives, service pick-ups and vehicle deliveries at homes and offices, or by appointment to help limit person-to-person contact, according to the New Jersey Coalition of Automotive Retailers (NJCAR).

New Jersey’s $35 billion auto retail sector, which employs 39,000 full-time workers and is the state’s number one source of sales tax revenue, has experienced a slump in sales over the past two weeks, the automotive advocacy group said.

Following Murphy’s order, NJCAR issued a statement saying, “The Governor’s Office says they are sympathetic to our request, but they are expecting a huge increase in COVID-19 cases in the next 48-72 hours and they believe loosening restrictions (any further) will send the wrong message. This, despite the fact, that New York has opened up to sales by appointment and some Philadelphia area dealers are open, which causes consumers to travel and increase the risk of spread.”

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