Pickerings Auto Group, among many other dealers in the flood-ravaged Townsville region, has jumped to offer assistance beyond that of a typical new car dealership, but insurance companies are hindering their efforts.
Speaking to AutoTalk this week, Pickerings dealer principal Scott McElligott says the community is still struggling to recover from once-in-a-century floods which saw monsoonal rains reached their peak at 20 times the average for the time of year.
Water levels in some suburbs reached 1.5 metres after the region copped an unprecedented 1454mm of deluge in just 26 days of 2019, according to Elders Weather.
The quantifiable financial result was more than 21,500 insurance claims, with losses estimated at $886 million according to the Insurance Council of Australia.Reports indicated more than 49,000 people in the whole northeast Queensland region have needed some form of assistance.
Suncorp Group says it alone has received over 1200 vehicle claims.
“These vehicles are an essential service for some people in this community; customers are coming to us – some with just a change of underwear in a plastic bag, covered in mud – asking for our help to start getting their lives back together,” he says.
ing the business out of town, which makes the flood recovery even harder,” McElligott explains.
“Most, but not all insurance companies, are making the process extremely difficult and they’re shovell
AutoTalk has learned, in the days following the story breaking, that roughly only one warranty claim in more than 30 is business being awarded to the local dealerships.It’s understood, one multi-brand franchised dealer has received five insurance claims to quote, but only had one successful claim with insurers.
“We can’t compete with fleet pricing, but our customers are fighting with insurance companies saying they want their car to come from their local dealer,” McElligott reveals.
Dealership businesses Key Motors, Carmichael Ford, Parry Nissan and Pickerings Automotive Group are calling on insurance companies and government to put the town’s economic recovery first.
Other Townsville dealer franchise businesses in include Tony Ireland Group (Holden, Jaguar Land Rover, Volvo) and the Townsville Auto Group (Isuzu Ute, Haval/Great Wall, Chrysler Jeep, Honda), Magnetic Motors (Mercedes-Benz Townsville), plus Mike Carney Toyota.
“All manufacturer brands have told us they’re here to help with additional stock, transporting them, Mitsubishi has even donated nine Triton utes to use indefinitely, which we’ve given to the local specialised flood relief teams, and the local council,” McElligott says.
According to McElligott, he estimates roughly 10,000 vehicles are in need of replacement, flooded out, physically destroyed by flood waters, or just plain missing.
Pickerings has around 200 loan cars worth more than $6 million out with customers as a means of assistance.
“We’re well into the clean-up battle to replace those cars.”
“This has nothing to do with an kind of sales boon for any of us, this is about a smashed community, which includes our friends and family, trying to repair itself,” he says, deflated.
“We all agree it’s a massive job to replace all those cars, but the first priority should be to keep the business local, because we’re already doing everything we can to help people who don’t even have their wallet or phone on them,” McEligott says.
“But the insurance companies are bringing in cars from out of town – away from our dealerships which need to stay open so our staff have security and can recover themselves,” McElligott reveals.
Only just this week have many of the Pickerings dealership staff finally returned to work after losing their homes, their possessions and their dignity.
McElligott describes scene after scene of devastation.
“Some places are still sodden; the water table is completely full, so the water has nowhere to go, roads are crumbling, cars sink into what looks like firm ground – and we just copped another 30ml over the weekend,” he says.
“At the dealership we had a dozen people whose homes went under, so we’re trying to keep them mobile, trying to get customers mobile again because the public transport isn’t great out here.”
McElligott says insurance companies need to consider it’s a disaster zone; you’re not just about filling out a pile off warranty claims, so think about how those claims aid the fragile, recovering local economy.
“Townsville dealerships need Townsville business, we need local support and they need us, but if insurance companies are passing the work to third-parties and leaving us out of the loop, we’re all sifting through the mud with one hand tied behind our backs,” McElligott appeals.
According to the DealerNomics data tool, the franchised new car dealers of Townsville in the Herbert electorate, employ over 460 people, contributed $67.
61 million in wages and other expenses, and made an economic contribution of nearly $97m last year with $438m in turnover.
ICA declared the Townsville flood a catastrophe in early February, and took part in one of two insurance forums late in the month where more than 150 policyholders met with Suncorp, RACQ Insurance, IAG, QBE, Allianz, CommInsure, Youi and Westpac Insurance representatives regarding their home and contents policies.
Insurance Council of Australia (ICA) spokesperson Campbell Fuller tells AutoTalk, insurance companies are working to replace cars as affordably and quickly as possible.
“Insurers prioritise the needs of their customers to get them back into the best possible match for the vehicle being replaced, as quickly as possible,” he says.
Insurers are able to leverage national and Queensland suppliers to provide the right vehicle at a price that helps avoid upward pressure on premiums,” Fuller explains.
“This may often be for a lower price than is achievable at local dealers.
“Customers who chose a cash settlement can buy from their choice of seller but may not be able to achieve the same outcome as their insurer.
“Townsville car dealers are able to provide after-sales care and service to local motor vehicle owners,” Fuller adds.
Suncorp Group’s head of motor claims Paul Sofronoff tells AutoTalk it is trying to give local businesses and vehicle owners first priority in the wake of flood devastation.
“We have a relationship with eight Townsville car dealers, and we have been sourcing from these and other local dealers,” he begins.
“Customers can tell us their preferred dealer and we will ensure they are invited to quote,” he says.
“We will only look elsewhere if the timeframes for delivery are too long, the colour is not available or the price difference is too great,” Sofronoff explains.
“If a local dealer is not close on price we will call and give them a second opportunity – again to try and keep it local.”
Sofronoff reveals Suncorp, whose brands include AAMI, GIO, Shannons, Just Car, Bingle and InsureMyRide, have large numbers of destroyed vehicles to replace.
“We’ve had over 1200 car insurance claims from the floods, with 95% written-off due to severe damage,” he reveals.
“Of these, we’ve already paid over $10 million directly into our customers’ bank accounts – this is expected to eventually reach $16m,” Sofronoff says.
He says Suncorp customers “can choose where they replace their car, and we support this money being spent directly in Townsville.”
Suncorp also says it doesn’t need to replace many vehicles as most are paid out in cash, but when they do, they insist they work with local Townsville’s franchised dealer network.
“On average we replace only a very small percentage of written-off vehicles instead of paying out in cash – around 3%,” he says.
McElligott says that not all insurance companies are hard work, but the majority could be writing themselves a more positive story for their customers.
“The large majority of our customers have had to fight to get their cars sourced from us or one of the other dealerships in Townsville,” he adds.
“We’re in the same game, where customer satisfaction is the new currency, and it’s a shame we’re being put in this position and customers are having to keep battling the companies they thought had their backs,” McElligott says.
“People are broken up here, they need help getting their lives back together; if a customer wants to support their local dealer – who has always supported them – it should be a fait accompli.”
AutoTalk has contacted local MP Cathy O’Toole for comment.
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