WASHINGTON—The federal government doled out at least $1 billion in emergency small-business loans since April to more than 21,000 tire- and auto-service-related companies in response to the economic hardships of the COVID-19 pandemic.
The billion-dollar total is based on Tire Business' analysis of data about the Paycheck Protection Program released July 6 by the Small Business Administration.
The PPP loans were aimed primarily at saving jobs by providing low-interest loans to help businesses of 500 or fewer employees cover payroll costs and other related expenses. The SBA did not indicate how many jobs were retained because of the loans.
In total, $521 billion in PPP loans were given out to business as part of the Coronavirus Aid, Relief and Economic Security (CARES) Act.
Tire Business' analysis of data in six industry segments—tire manufacturers, retreaders, dealers, wholesalers, automotive repair and oil/lube shops—showed 21,217 companies received loans totaling between $1 billion and $2.2 billion.
The range is large because the federal information shows only a range, not a specific loan amount, for each company.
Tire dealers received the most funds among the categories tracked, with 5,765 companies classified as tire dealers receiving between $599 million and slightly more than $1 billion. The average for each business was between $103,850 and $186,643.
In this category, seven companies are shown in the maximum loan range of $5 million to $10 million: ATV Inc. (American Tire Depot) of Vernon, Calif.; Earl W. Colvard Inc. of Deland, Fla.; Commercial Tire Inc. of Meridien, Idaho; S&S Firestone Inc. of Lexington, Ky.; VIP Inc. of Auburn, Maine; Plaza Tire Service Inc. of Cape Girardeau, Mo.; and T&W Tire L.L.C. of Oklahoma City.
McCarthy Tire Service Inc. of Wilkes-Barre, Pa., is shown as having received five separate loans totaling at least $8 million and as much as $19 million.
Thirty-four companies received loans of between $2 million and $5 million, and 48 got $1 million to $2 million.
For many dealers around the U.S., the PPP loan provided much-needed funds for an industry that saw demand for tires and service drop significantly in the second quarter.
"It's so hard to find people anyway out here ... that we decided to just hold on to everybody (during the pandemic)," Matthew Jensen, CEO of Jensen Tire & Auto Inc. told Tire Business in June.