Auto Trends

2009JUL010758, originally uploaded by bootload

The Big Clash of the Clunkers battle was fought and lost last month by many dealerships, and now as they wait out the rest of September to receive their government refund, you can expect the following four things:

One, a lot of car lots will be relatively barren, due to the magnitude of vehicles that were sold. Two, a lot of folks in the market for a new vehicle have already purchased, so new customers should be almost as barren as the available vehicles themselves. Three, the big clunker deals that emptied many car lots, will most certainly keep many new customers at bay, as they wait for the inventories to rebuild. Four, all of the above scenarios stands to produce some pretty desperate dealerships, who will be willing to make some pretty good deals this month, especially on select vehicles.

But to get in on the good deals, the September customer needs to be aware of a few things. Last month depleted a lot of gas sipping economy vehicles, but the big SUV’s and luxury vehicles remained rather untouched. This will result in some great deals for anyone who is currently in the market for one of these vehicles. The September customer also needs to be aware that just because a dealership lot is empty, certainly doesn’t mean that they cannot go in and order a vehicle at a great price. Manufacturers are busy building vehicles to replenish the depleted lots, don’t you worry about that.

In addition, if you have a trade-in vehicle, you might find that dealerships will covet its worth (in certain circumstances) just a little more than usual, since most of last months Clunker trade-ins are already rusting away in some junkyard. Not only are new car lots empty, but many of their used lots are also a bit sparse. With that said, let’s take a look at some of the highlights for the month of September 2009:

Audi
Nope, don’t come a knocking here if you are looking to deal.

BMW
The big news this month at BMW is the 2009 BMW M3, which is currently being unloaded at a very reasonable 0.9% APR financing for 36 months. This is of course in preparation of its 2010 brothers and sisters to take its place at the helm of the showroom floor. There are better deals to be had out there, but for a world class luxury sports cars, this is about as good as it is going to get. Offers last through the end of September 2009.

Buick, Cadillac, Chevrolet, GMC, HUMMER, Pontiac, Saturn, Saab
These eight brands are obviously ready to deal. This month you will find a multitude of various discounts and cash-backs offers which are so varied by state to state, I can’t even begin to list them out. However, many areas will have 0% financing available for those who qualify, but keep in mind that all these various discounts cannot be combined, so you will have to choose wisely. These deals will be in effect through the end of September 2009.

Chrysler, Dodge, Jeep
Chrysler didn’t have quite the turnout they had hoped though Cash For Clunkers, but they aren’t about to be left in the dust this month. You can expect to find deals on many popular models in the form of rebates of up to $4,500. 0% financing will also be a popular draw for some consumers, but the offers once again vary greatly from state to state, so check with your local dealer to see just how desperate they are. Offers set to run through the end of September 2009.

Ford, Lincoln, Mercury
Ford has been kicking some sizable butt this year, and they aren’t letting up anytime soon it would appear. This month you can find various rebates up to $5,000 on various 2009 models, and you can also count on 0 % APR financing for up to 60 months (as long as you qualify, that is). These deals are set to run through October 5^th, 2009.

Mercedes-Benz
Down from the 1.9% APR financing Mercedes was offering just a few months ago, you can still get a 2.9% APR for 36 months through the end of September on most models. Nothing to get too excited over, but if you are just jumping out of your skin to slip in a new Mercedes, this may not be a bad month, as their deals appear to be slipping by the wayside faster than the dodo bird.

Toyota
Toyota is holding their National Clearance Event this month, which means cash-back rebates as much as $4,000, and 0% APR financing with no limits on the loan term (36, 48, 60, 72, take your pick). Once again, Toyota has not announced an expiration date for these deals, so you’ll at least have through the end of September, barring any unforeseen Toyota tragedy.

Mazda
Not much here.

Volkswagen
Not much here either.

You only have until the end of September for many of these deals, so its best to get out there… while the gettin’s still good!

Source:
U.S. News & World Report: Best Car Deals, September 2009

chrysler emblem, originally uploaded by Jay B

According to Automotive News, Chrysler was certainly the big loser of the bunch, having only accounted for 6.6 percent of the total sales in the Clunkers Program. GM and Ford did not fair to bad, with GM coming in second with 17.6 percent of sales, and Ford third with 14.4 percent.

The beginning of August reported a slightly different story, with Ford in the lead with their popular Focus. As the clunkers program drew on, however, the popularity of the domestic brands faltered, leaving Toyota as the victor with 19.4 percent of the total sales.

These numbers only tell half of the story, as to really get an idea of where the brunt of the sales were going, we need to match up the sale of the imports vs. the domestics. What we know is that the domestics only accounted for 38.6 percent of the total vehicles sold (690,114). The number of imports sold, classified as “made in the USA,” are still relatively unknown.

This however did not stop most experts from making the obvious conclusion that the Cash For Clunkers brought more aid to foreign manufacturers that U.S. domestics. Considering market share vs total sales, Toyota rocked our world with 19.4 of sales, compared to its 16.3 percent market share.

Hyundai was right along side Toyota with a whopping 7.2 percent of sales, compared to their 4.3 percent market share. Chrysler bombed out early in the game, earning only 6.6 percent of its 9.6 percent market share.

Lets pull back and take a look at the winners and losers of the Clunkers program in total:

                          Total Clunker Sales                                Total Market Share

#1 Toyota                    19.4%                                                         16.3% Winner

#2 GM                          17.6%                                                            Runner Up

#3 Ford                         14.4%                                                           Runner Up

#4 Honda                      13.0%                                                           Runner Up

#5 Nissan                       8.7%                                                            Runner Up

#6 Hyundai                    7.2%                                                           4.3% Winner

#7 Chrysler                    6.6 %                                                        9.6% Big Loser

The order of most popular vehicles also changed a bit from the initial statistics produced early on in the program. They show Ford with an early lead, which would then lose its favor to the traditionally popular brands, Toyota and Honda. Hyundai and Nissan would then make an entrance, sweeping out anything else that the domestics had to offer, including the marginally popular Ford Escape.

Here is the initial list of popular vehicles during the start of the program on August 5^th:
1. Ford Focus
2. Toyota Corolla
3. Honda Civic
4. Toyota Prius
5. Toyota Camry
6. Ford Escape

Here is the list of popular vehicles at the conclusion of the program on August 25^th:
1. Toyota Corolla
2. Honda Civic
3. Toyota Camry
4. Ford Focus
5. Hyundai Elantra
6. Nissan Versa
7. Toyota Prius
8. Honda Accord
9. Honda Fit
10. Ford Escape

All in all, the program boosted sales from all dealerships and decreased the total pollution output of vehicles in the US, but just how much the $3 billion actually helped to improve domestic sales, is still a bit of a mystery.

Cash for Clunkers - Maui - Act of Protest 1, originally uploaded by cesariojpn

You would think that we had a B-rated movie in the making with all the happenings of the Cash For Clunkers Program. Initially, we had quite a debate about the whole idea of the program. Then when it finally kicked off, it ran out of money before it even had time to hit the ground running.

So, at this point we were at a pivotal weekend for the program (the beginning of August), and dealers were not even sure if the government was going to be able to foot the bill. To ease the minds of consumers and dealers alike, press secretary Robert Gibbs, got on the horn and offered assurance that the $1 billion funds would be intact at least through the end of that first big weekend.

That big weekend brought in an amazing total of 250,000 deals, but folks really had no idea what was around the next corner. That’s when another surprise slipped through Senate. They were going to allow another $2 billion for the program, making the grand total, $3 billion. The plan now was to keep the program rolling through September, although flying pigs would have been more likely of the two.

So the program started back up. Consumers were rolling their clunkers onto the lots, and then rolling off with a brand new vehicle. The Ford Focus and Toyota Camry were among the top favorites. Within days, dealers actually began to run out of these vehicles and frantically requested more from the manufacturers.

Next thing you know, automotive factories were sweeping the cobwebs off their doors and workers started pulling more shifts to keep up with the new-found demand. GM alone ordered the reinstatement of 60,000 more vehicles just to replenish their Cash for Clunkers inventory loss.

Everything seemed as if it were working like clockwork, until…

Dealers started to get a little edgy. They were selling thousands of cars, but no one was getting any government checks to help foot the bill. A couple weeks into the program and 411,624 clunkers had been processed ($1.72 billion), but out of those, only a very small percentage had been refunded back to the dealer.

Top these frustrations off with a rash of government rejections for reimbursement claims, and the managers of these lots had just about had enough of clowning around with the system. They began to retreat from the program and turn customers and their clunkers away. Many dealers were complaining of being out as much as $250,000 or more without a single penny in sight.

Soon after, the Senate decided that the Clunkers had run its course. They knew they’d better lay the program to rest while they still had the available funds to stand on. The program is set to officially end this coming Monday, August 24, 2009, making this the last weekend for consumers to take advantage of deals (assuming you can still find a dealership willing to take the gamble). Dealerships will also need to have all their claims for reimbursement turned in by that same day.

NADA jumped in the picture almost immediately, asking the Senate to extend the deadline by one week. They gave the reason that the program hasn’t exactly been rolling on wheels (more like square pegs), therefore, a few extra days to ensure dealers could get through the malfunctioning application process, seemed more than reasonable. The Senate came back, stating that the government website was working flawlessly now, and that dealers should have no trouble meeting the deadline.

What does this leave us with as the fat lady prepares to belt out her final duet with the Senate…

We have a record number of sales for the month of August. We have a handful of happy consumers, a heap of clunkers off the road, a slew of new vehicles ready to take to the streets, reports of slightly less emissions going into the atmosphere, and a pile of new vehicles being built by manufacturers in response to their recent success on the lots.

Unfortunately, we also have a cluster of irritated and frustrated dealerships, a confident Obama assuring dealers “will get their money”, a price hike on the way for new model inventories, a heap of piping hot charity organizations who say there were better uses for the vehicles that were destroyed, full junkyards, and the beginning of what experts say is going to be one heck of a hangover (poor auto sales) from the party we’ve just enjoyed.

So, should the Cash For Clunkers be called a success or a failure? You be the judge…

Source: Automotive News