We knew critics of Chrysler's $2.99 Gas Guarantee would crawl out of the woodwork before too long, and here they come. Automotive News reports that The Union of Concerned Scientists has called Chrysler's program a "cynical deal", noting that at today's current average price of $3.61/gallon, a customer would save about $400 a year under Chrysler's program. Being the smart folk they are, the scientists also pointed out that customers could save the same amount from a 3 mpg bump in fuel economy over 15,000 miles or a year of driving, and that better fuel economy also continues saving the customer money after three years. Damn, scientists are so smart with the math. The criticism hasn't stopped Suzuki, however, from announcing its own free gas deal. For vehicles purchased between May 1st and June 30th, Suzuki is offering 0% financing and three months of totally free fuel in its "Free Gas for Summer" program. Buyers will basically get a stored-value credit card that's charged with a different amount of money depending on the model purchased.
These incentive programs are nothing but promotions designed to grab headlines and make buyers feel like they're getting more money back than they actually are. Playing off the media's hysteria over high gas prices, Chrysler (and Suzuki) is betting buyers will feel that paying $2.99/gallon for three years is more valuable than a $2,000 cash back rebate. Trust the math, it's really not. Nevertheless, it will likely sell more Chrysler, Dodge and Jeep vehicles than a boring $2,000 rebate would.
[Source: Automotive News – sub. req'd]
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Reader Comments (Page 1 of 3)
Tai @ May 6th 2008 6:03PM
I'm waiting for Hilary Clinton to jump on this bandwagon as well.
User @ May 6th 2008 7:08PM
It would be a nice way for her to show us that she can "stick it to the man." Even though she technically is "the man."
J C @ May 6th 2008 10:38PM
She wouldn't have to if the democrats counted Florida.Haha
TwinTurbo3000GT @ May 7th 2008 8:47AM
they did count florida. twice, in fact.
"Playing off the media's hysteria over high gas prices"
says it all.
Johnny @ May 6th 2008 6:11PM
What the scientist say is true and logical. Chrysler knows this as well but they are stuck between a rock and a hard place. It takes years for them to turn around this company and in the meantime they need to move vehicles. I think when this gas card idea got approved at their board meeting a bunch of people in the room lowered their heads but what can they do?
I dont blame them.
In 2014 selling gas guzzlers and giving away 2.99 gas cards would be inexcusable
notYou @ May 6th 2008 10:11PM
In 2014 it would be perfectly fine if you would just let us drill where the (American) domestic oil supplies are. China's drilling 50 miles off Florida's coast, but because of people like you my gas is sourced from Canada, South America, the Middle East, or worse. Thanks.
PJ @ May 6th 2008 10:28PM
I agree. And by the way...
"Damn, scientists are so smart with the math."
"These incentive programs are nothing but promotions designed to grab headlines..."
... so, John, when UCS points out the fallacy inherent to "free gas" programs, it's whining worthy of ridicule, but when you do it, it's hard-hitting news? C'mon.
Corey L @ May 6th 2008 6:12PM
Right... because The Union of Concerned Scientists is run entirely by scientists...
"UCS members are people from all walks of life: parents and businesspeople, biologists and physicists, teachers and students."
Kristovar @ May 6th 2008 6:18PM
I would never underestimate the astonishing naivety of the average consumer.
que @ May 6th 2008 6:19PM
on the other hand if gas skyrockets to $6 a gallon (which is entirely possible considering the cost of oil is predicted to rise to $200+ per barrel within 18-24 months) then this is not only a great deal, its also one more nail in the coffin for chrysler.
Dinger @ May 6th 2008 6:26PM
Right. The average price might be $3.61... but it's $4.22 in my town. That makes $2.99 gas look a lot more interesting.
steve @ May 6th 2008 6:44PM
so ya fill up yer brand new k car take it home , pump the gas into yur suburban, go back and get more 2.99 gas and repeat 3 times---who says good red blooded murikans cant drive what they want
Mark @ May 6th 2008 10:23PM
It's not a nail in the coffin for Chrysler. Do you really think that Chrysler is THAT stupid? It's call fuel hedging. They have hedged the fuel, so they won't be paying future prices.
tankd0g @ May 7th 2008 1:42AM
Unless you have a lot of driving to the moon to do or fitted the 150L backup tank. This still isn't much of a deal compared to the cash incentives you are giving up.
Jrejre @ May 6th 2008 6:28PM
It's a sales promotion. Every company does stuff like this. I don't know why this one is being treated like something new and different or that poor dying chrysler is trying to take advantage of consumers.
MajorGeek @ May 6th 2008 10:02PM
Apparently even AFTER you posted this, some still dont seem to get that. If you want a Dodge, you can save roughly 50 cents to a buck a gallon for a year. If you dont like this deal, take a rebate, low interest rate or maybe a free baseball cap. Or, do what I did, keep your gas guzzler for when you need it and go buy a tiny car like a Honda Civic.
DesiAuto @ May 6th 2008 6:29PM
Hmm, so they are still working on coming up with gimmicks.
I thought someone from BIG 3 will be working on 150 MPG engine, I guess expecting them to actually THINK about LONG-TERM is too much to ask.
That One Person @ May 7th 2008 5:54AM
Don't tell me you actually believe that.
You think they invested a whole team, suppliers and hundreds of millions of dollars into THIS and not a, let's say, hybrid program?
If you truly believe that, do us a favor and just go sit in the corner and be quiet.
Tricky dicky @ May 6th 2008 6:31PM
they can all change into their hemp jumpsuits and sing kumbaya..
It is a marketing gimmick more than anything..
Frank @ May 6th 2008 6:32PM
"Nevertheless, it will likely sell more Chrysler, Dodge and Jeep vehicles than a boring $2,000 rebate would. "
How about, "Nevertheless, it will likely sell more Suzuki vehicles than a boring $2,000 rebate would."
I guess it's just dandy when Suzuki does it.