How a dealer or repair shop operates
A dealer or repair shop sells and services durable goods through twelve functions, each performed at a place, with a counterparty, on an input that a governmental order can reach and did reach. The showroom, the service bay, the parts counter, the test drive, the delivery, the title office, the finance desk, the assembly plant, the car show, the technician's certification, the back office and the commute are each a subject of orders. The customer base is every household and every fleet in the country, and every one of them was under orders.1
SR, showroom and sales
The showroom is the floor on which new and used vehicles, boats, recreational vehicles, motorcycles and equipment are displayed, on which a salesperson meets a walk-in customer, appraises a trade, negotiates a price and closes a sale, and from which the customer leaves in the vehicle. Sales are a walk-in trade: the customer comes to the lot, sits in the vehicle, drives it and signs. An order that closes the showroom "to in-person traffic," confines sales to remote or electronic transactions, admits customers "only by appointment," caps the floor at twenty-five or fifty percent of occupancy, or places every person on it under workplace infection-prevention and exposure-control requirements, face coverings and distancing, changes what the showroom does, how many customers it can serve and how a sale is made.2 Sales are the largest revenue line of a franchised dealership and the only revenue line of most independent used-vehicle, boat and RV dealers.
SV, service and repair
The service department repairs and maintains vehicles in bays staffed by technicians, receives customers at a service drive and a counter, holds them in a lounge, provides loaners and shuttles, and performs warranty work on the manufacturer's account. Independent repair shops, collision shops, tire stores and quick-lube operations perform the same functions without a franchise. Every order of March 2020 designated repair and maintenance as essential; every one of those orders then fixed the conditions under which the essential half of the business operated: distancing in the service drive, the lounge closed or capped, face coverings on technicians and customers as one of the occupational-health and airborne-transmission controls, screening at the door, no-contact drop-off and key exchange, and, in Los Angeles County from December 30, 2020, "Automobile Dealerships, Auto Repair" at twenty percent of indoor capacity.3 Service is the revenue line the orders permitted to continue while they closed or capped the showroom, and it is labor sold by the hour in a fixed number of bays under a fixed roof, every one of them operated on the orders' conditions.
PT, parts
The parts department sells parts and accessories over a wholesale counter to independent shops and fleets, over a retail counter to the public and to the dealership's own service bays, and it depends on the manufacturer's parts distribution centers and on freight. Parts stores were essential everywhere under the same conditions as service, and their inventory depended on plants, ports and borders that the orders inventoried in the layers section closed or conditioned.4
DL, delivery, test drives and field service
A vehicle is sold after a test drive and delivered by hand; a boat or RV is delivered with a walk-through; farm, construction and industrial equipment is delivered to the customer's site and serviced there by mobile technicians. Orders barred the test drive with the showroom, then permitted it only "without an employee present" or "limited to the customer and the customer's household members," and required that "all deliveries occur without personal interaction" and "curbside, at the customer's home, or in open service lanes."5 Field service on a customer's farm, job site or plant depended on the customer's premises being open to outsiders and on the technician's freedom to travel.
DM, motor-vehicle offices, titles and registrations
No sale is complete until the vehicle is titled and registered, and no dealer may deliver a vehicle without a plate or a temporary tag. The dealer performs that work at, or through, the State motor-vehicle agency, the county clerk or tax assessor-collector, the deputy registrar or the tag agent, and it holds a dealer license, dealer plates and a bond from a State board. In March 2020 every one of those offices closed to the public or went to appointment-only or drop-box service; the States extended expirations, suspended title and registration requirements and, in Texas, waived them for thirteen months; and in several States the appointment regime ran into the third quarter of 2021.6 The title office is the dealership's counterparty for every unit it sells, and every State closed or restricted it by governmental action: by the Governor's order where the order reached the agency in terms (New York's Executive Order 202.8 cancelled every in-person appointment), by statute where the Legislature extended every expiration (Ohio's H.B. 197), and elsewhere by the agency's own closure under the State's emergency declaration, which the agencies' closure notices, cited here as the record of that action, announced.
FI, finance and insurance
The finance desk arranges the retail installment contract or lease, sells service contracts and insurance products, obtains lender approval, verifies identity and income, and obtains the customer's signatures, some of them notarized. It depends on lenders whose offices and appraisers were under the federal financial regulators' emergency statements, on notaries whose in-person acts every State rewrote by emergency order, and on the customer's physical presence to sign. The remote-notarization orders of Pennsylvania, New York, New Jersey, Massachusetts, Michigan, Maryland, Texas, Georgia, Nebraska, Vermont, Mississippi and Illinois are the orders under which the finance desk moved to electronic contracting, and several of them ran through the third quarter of 2021.7 The dealership's floor-plan lender finances the inventory on the lot; when the plants closed, the lot emptied and the floor plan shrank.
SC, manufacturers' plants, semiconductors and freight
A dealer sells what the manufacturer ships. New vehicles, boats, RVs and equipment are built in plants in Michigan, Ohio, Indiana, Kentucky, Tennessee, Alabama, Texas, Mexico, Canada, Japan, Korea and Germany; they move by rail, truck, ship and land border; they contain semiconductors packaged in Malaysia, Taiwan, Japan and Vietnam; and they are sold from an inventory the dealer floors on its lot. Michigan closed every non-critical manufacturing plant by order from March 24 to May 11, 2020; Pennsylvania closed transportation-equipment manufacturing on March 19, 2020; Mexico suspended non-essential activities, including automotive assembly, from March 30 through May 30, 2020; the United States restricted the land borders to essential travel from March 20, 2020 to November 8, 2021; the Federal Railroad Administration imposed face-mask controls, an airborne-transmission control, on every railroad operation from March 1, 2021; the Captains of the Port conditioned every port and vessel under the Coast Guard's regulations and the CDC's conveyance order, as the Coast Guard's bulletins record; and in 2021 the semiconductor orders of Asia left dealers with lots the Federal Reserve described as "largely already spoken for."8 A closed plant, a closed border and a port under airborne-transmission controls are each an order on the dealer's supplier in the sense that Q&A-12 of Notice 2021-20 (the "Notice") recognizes, and the dealer's inventory is the "critical goods or materials" the Q&A names.
MK, shows and events
New vehicles, boats and RVs are introduced and sold at auto shows, boat shows and RV shows, held in convention centers in January through April and in the autumn; farm and construction equipment is sold at trade shows and field days; dealers hold tent sales and sponsor events. Gathering prohibitions and venue closures postponed the 2020 New York auto show and cancelled the 2020 Detroit show, cancelled or moved the boat and RV shows of 2020 and 2021, closed McCormick Place from March 2020 to July 2021, and cancelled the 2021 New York Auto Show, as the organizers' own notices and the Federal Reserve's report of September 8, 2021 record.9 The show is the industry's largest single sales event, and it is a group meeting in the statute's words.
HR, hiring and licensing
Technicians hold manufacturer and ASE certifications obtained at testing and training centers that the closure orders reached; salespersons hold State licenses issued by boards whose offices closed or whose renewals were waived; commercial drivers who deliver vehicles hold licenses whose examinations were suspended and whose expirations were extended; and every new hire's documents were verified under the Department of Homeland Security's announced deferral of in-person Form I-9 inspection. California's Department of Consumer Affairs waived renewal requirements for its Division 3 licensees, which include the automotive repair dealers registered with the Bureau of Automotive Repair, for licenses expiring from March 31, 2020 through October 31, 2021; the California Department of Motor Vehicles extended expiring commercial driver's licenses through November 30, 2021 by notice of September 2, 2021.10
OP, offices and telework
The dealership's business office processes titles, payroll, warranty claims, accounts payable and deal jackets; the group office manages several stores. Telework mandates in Michigan, New York, New Jersey, Pennsylvania, California, Kentucky, Oregon, Washington and the other States confined those offices to remote operation, and the State workplace standards fixed the conditions under which they reopened.11
WF, workforce availability
The workforce of technicians, porters, salespeople, service advisors and office staff lives in the metros, commutes by car and transit, has school-age children and is exposed at work. Stay-at-home orders confined it; school-closure orders kept parents home; quarantine and isolation orders removed exposed and infected employees for ten to fourteen days; the Families First Coronavirus Response Act compelled the employer to pay those absences from April 1 to December 31, 2020; the State paid-leave statutes of New York and Colorado compelled it thereafter; the federal conveyance order placed every transit commute under airborne-transmission controls from February 1, 2021; and the school face-covering and quarantine orders of the autumn of 2021, airborne-transmission and exposure controls on every classroom, governed the workforce's children.12
CB, the customer base
The industry's customers are every household and every business that owns a vehicle, a boat, an RV or a machine, and every fleet, rental company, municipality, school district, utility and government agency that buys and services vehicles. The stay-at-home orders of 2020 confined the households; the closure orders confined the businesses and their fleets; the rental companies' airport counters emptied with the travel orders; the school districts parked their buses under the school closures; the federal agencies went to maximum telework; and the tribal and territorial governments closed their reservations and islands. Under Q&A-12's logic, the statute's text and the admission of the United States (the Government as litigant in the ERC cases) that a business may be suspended due to an order addressing a third party, an order that confines the customer's commerce is an order limiting commerce, and a sale or a repair delayed because of it is delayed due to that order.13
Revenue lines, seasonality and geography
Revenue is earned on new-vehicle sales, used-vehicle sales, finance and insurance income, service labor, parts and accessories, body-shop work and, for equipment dealers, rentals. The selling season runs from the tax-refund months of February through April into the spring and summer; boat and RV sales are made at the winter shows and delivered in the spring; farm equipment is sold ahead of planting and harvest; new model years arrive in the autumn. The March 2020 closures fell on the first weeks of the selling season, the winter re-tightening on the year-end sales events, and the 2021 inventory collapse on the spring and summer of 2021. The industry is in every county of every State, concentrated along the auto rows and highway corridors of the metropolitan areas where the local orders were densest and lasted longest, and its manufacturing supply is concentrated in the industrial Midwest and South, in Mexico and in East Asia.14
The counterparty map
Each counterparty class was reached by orders of its own. Customers: the stay-at-home, closure, travel and gathering orders of every State and metro, and the federal workforce orders on governmental fleets. Motor-vehicle agencies, clerks and tag offices: the closure, appointment and extension instruments of every State. Manufacturers and parts suppliers: the Michigan, Pennsylvania, Ontario and Mexican closure orders, the semiconductor orders of Asia, the land-border, port, rail and entry instruments of the United States. Lenders and notaries: the federal financial regulators' statements, the appraisal deferrals, the credit-union relief rules and the emergency remote-notarization orders. Venues: the gathering limits and convention-center closures of the States and metros. Schools, child care and transit: the closure orders and the face-covering and conveyance orders, airborne-transmission controls on classrooms and commutes, on which the workforce's availability turned. Licensing boards and test centers: the closures and waivers. The layers section inventories each class.