FLOOD 2011: Stress level rises for Louisiana, Mississippi dealers

As the crest of a swollen Mississippi River rolls downstream toward Louisiana, dealers in affected areas report their businesses are so far safe from the water, but they still may feel economic ripple effects.

“It’s doing a number. We’re watching it rise every day,” said Aden Wansley, who also owns Yasky ATV Accessories in Vicksburg, Miss. The river isn’t forecasted to crest in the area until May 22. “It’s still coming up. We have about four to five more feet to go.”

You can already tell the difference, he said. “Business has slowed down a little bit. A lot people have no electricity. A lot of people may have moved out of their houses since the electric company [had] to shut the power down.”

While Wansley’s business is safe, his 1,000 acres of farmland could be in danger if a levee breaks. That scenario prompted the Army Corps of Engineers last weekend to open the Morganza Spillway, diverting millions of gallons of water into low-lying Cajun country in a tradeoff to keep big cities like Baton Rouge and New Orleans dry.

The Army Corps' action, however, may leave Houma, La., looking more like a peninsula than a plateau. The town is home to several dealerships, including two Dealernews Top 100 Dealers: Performance Power Sports of Houma and Cycle World of Houma.

“We hope that it won’t have too much impact,” said John Soileau, GM at Performance Power Sports. “As of right now it hasn’t affected us. We’re on high ground.”

More worrisome is the impact the flooding will have on the dealers' customer base. Glenda Davis is office manager at Great River Honda in Natchez, Miss., a dealership safely on the high side of the river but which draws many of its customers from the lower Louisiana side. “At the moment we’re fine. What will happen next week or the week after, we don’t know,” she said.

“Nobody is going to have any money, because most of them are farmers,” Davis added. “They gotta have food and a place to live.”

Glenn Diedrich, owner of Cycle World of Houma, doesn’t expect his business to get too wet. “We don’t expect to get any floodwaters. But we are affected from this standpoint: Everybody is focused on the flood and not on anything else,” he said.

Cycle World of Houma’s customer base is scattered about 14 parishes, most of which will be flooded by this time next week. “On some of the news programs I saw this morning, there will be some areas where the flood waters will remain for four or five weeks,” Diedrich noted.

Once the waters recede, however, area dealerships may get a business boost from the cleanup efforts. “With the [BP] oil spill, for example, there was the adverse effect of the spill itself, but the positive effect was that we sold several ATVs to parish governments,” Diedrich said. Even last week, before the spillway was opened, some parish operations were checking Cycle World’s prices on ATVs and utility vehicles, he added.

Even if municipalities aren’t buying, Diedrich’s store does what it can to help pick up the pieces, including loaning units – some new, some used, some demos -- to parish governments to help with cleanup efforts. “After Katrina, we loaned out 30 units for the cleanup,” he recalled. “Honda and Kawasaki helped us with the price of those units because of what we did. We were able to refurbish those units and sell them into the market.”

This is a different disaster altogether, and one hitting much closer to home. “All these people that are affected by these floodwaters may not be able to buy ATVs and street bikes,” Diedrich said. Instead, “they’ll have to repair their homes and streets.”

Things are calmer in Baton Rouge and New Orleans. Phillip Lewis, service manager at Rad Cycles in Baton Rouge, said no flooding is expected there even when the river crests, which it was expected to do as we posted this story. “It is going to crest here tonight,” Lewis told Dealernews. “I don’t really think we will be affected.“

Voodoo Harley-Davidson in New Orleans’ French Quarter is right near the river but insulated from the effects of the flooding and the diversion. They know emotions elsewhere in the state are running high. “A lot of people are really upset about the whole thing; people are not very happy with New Orleans being saved” at their expense, sales associate Nikki said.

Despite the calamity north and west, traffic remains steady in The Big Easy, she noted. “Our location is in the French Quarter so the majority of our business comes from tourism. Our tourists are still in town. None of them are afraid of the flooding. It doesn’t seem like anyone is scared to come.”

To see a map of the projected flood area, click here.

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