Cash For Clunkers Need Not Come To An Endby
As the Cash For Clunkers program comes to an end tonight, I heard a pretty good idea mentioned for some automaker to take advantage of in the coming days and months: continue the program without the government’s help.
Huh? Sure. If I was an automaker, and saw how well people responded, I might just adjust my overall incentive program so that I could give customers trading in a clunker at least $500 extra, or maybe even $1,000 on top of existing incentives if the buyer trades up in fuel economy.
Say some Ford owners continue to come out of the woodwork this year with 1993-94-95 Ford Explorers. My idea is to take the trade in value, give the buyer the typical $1,500 on the Fusion, he or she wants, and then bump him or her another $500, $750 or $1,000 if the vehicle they are buying is five to ten mpg more fuel efficient.
The company that jumps on that idea will get the benefit of being the first one in the pool to be able to run an ad that says “Thanks Uncle Sam. Now’s We’ll Take It From Here.” Run the program out at least until the end of the year.
Hyundai has proven that being first into the market with a fresh idea counts for a lot. The Korean company was first to offer customer assurance (a program in which customers could turn a car back into the dealer if they lost their job with no hurt to their credit rating), as well as $1.49 gasoline this year. Hyundai got huge mileage from those programs in terms of Internet hits and website traffic. And sales and consideration for Hyundai continues to climb.
We’ll see if any automakers bite to extend the program on their own.
The latest on the actual government clunkers program, which ends tonight is that dealers have until noon Tuesday (tomorrow) to file transaction information with the Dept. of Transportation. The National Association of Auto Dealers is asking the DOT to extend that deadline further to make sure dealers don’t eat the rebate money they have already paid out because of filing snafus with the DOT.
Also, as of Monday, August 23, DOT said it knew of 625,000 dealer transactions worth $2.58 billion in rebates, with several hours to go until the program closed. It is pretty much a lock that all $3 billion allocated by Congress will be claimed when all is said and done.
Toyota appeared to be the top beneficiary of the program, though not all the sales are tallied.
Vehicle buying website Edmunds.com said August sales for the auto industry appeared to be clocking in at a seasonal adjusted selling rate of 13 million-13.5 million. If that holds, it would be the industry’s best month of the year.