Auto Accident Claims Covered by CGL Form?

Our insured traded a vehicle that was part of their business to a dealer. Two years later, the employee of the vehicle owner was injured in an accident caused by a tire that blew out. A claim is now being brought against the insured for the injuries sustained by the employee. Is the claim covered by the CGL form? The claimant is asserting the theory that the insured has strict liability with respect to sale, warning, and instructions. In addition, the claimant is alleging that if the insured knew of the retread and the puncture repair to the tire, and placed the tire on the wheel of the vehicle, the insured exposed the claimant to an unreasonable risk of harm.

The insured's commercial auto carrier is denying any coverage since the vehicle was no longer owned by the insured at the time of the accident, so it was not a covered auto. The general liability carrier is denying coverage due to the auto exclusion. We think that the CGL form does apply to the claim. What is your opinion?