An estimated 500,000 Texan vehicles could be totaled and scrapped in the wake of Hurricane Harvey, snowballing into a massive sales wave of new and used cars in the coming months.
As opposed to the fallout of Hurricane Sandy and other major storms of the past, the sheer density of vehicles in Houston and other parts of Texas compared to, say New York City and the State of New York, will likely lead to massive insurance write-offs for flood-damaged cars. The estimate could possibly tally up to as many as half a million cars, according to Cox Automotive—the company behind Kelly Blue Book and Autotrader—via CNBC.
There are scores of cars and trucks with water up to their windows and in some cases over the hood and roof.
In fact, the flooding is so extensive, Cox Automotive estimates a half-million vehicles may wind up in the scrap yard.
“This is worse than Hurricane Sandy,” said Jonathan Smoke, chief economist for Cox Automotive. “Sandy was bad, but the flooding with Hurricane Harvey could impact far more vehicles.”
After Hurricane Sandy battered New York and New Jersey in October 2012, an estimated 250,000 vehicles were scrapped.
According to CNN, 13 million people received flood warnings, with an estimated 30,000 people needing temporary shelter and nearly half a million people are expected to seek assistance from FEMA.
As residents slowly begin to recover from the catastrophic impact of Hurricane Harvey over the coming months, auto dealers in southeastern Texas are reportedly expecting a big growth in sales. Used vehicle prices are expected to surge, new car sales are expected to grow, and people recovering will need to be extremely vigilant against those trying to take advantage of the horrible situation.
It’s not uncommon for shadier sales practices like price-gouging and title-washing, a practice of illegally altering documentation for flood-damaged or otherwise salvaged vehicles. There have already been numerous reports of hotels, convenience stores and gas stations inflating prices to take advantage of those struck the hardest by Hurricane Harvey.
There is no quick fix for the record-breaking damage in Texas, and as thousands of people attempt to return to their normal lives, they’ll face a new struggle against those seeking to profit off of their tragedy.