So far, Hyundai has been the only automaker in the U.S. to accept early trade-ins under the Car Allowance Rebate System (CARS), or Cash-for-Clunkers (CFC), program. Most are waiting for the U.S. Department of Transportation to finalize the program's rules and regulations by July 24th, but Hyundai decided to start early since the program covers all transactions dating back to July 1st. Since the government hasn't set up a reimbursement process for the rebates that range from $3,500 to $4,500 just yet, Hyundai is floating its participating dealers short-term loans in the meantime.
After just one week of accepting Cash-for-Clunkers trade-ins, Hyundai has revealed that these deals added up to 7 percent of its overall sales and could reach 10 percent by month's end. The most interesting statistics, however, are what's being traded in. While Hyundai doesn't break it down by model, according to its numbers, 32 percent were Ford vehicles, 23 percent Dodge and the rest were from Lexus, Jaguar and Mercedes-Benz. Keep in mind, all these customers are trading in for a Hyundai, and 41 percent chose the Elantra! The Sonata came in second with 29 percent of CFC sales and the Accent third with 16 percent.
Judging by this early report on how the CFC program affects sales, it will be very interesting to see what happens after the hammer drops on July 24th and all automakers begin participating. The effect on July sales will likely be small, so we'll have to wait until the end of August to see if Cash-for-Clunkers has really made a difference. For Hyundai, however, it already has.
Hyundai Elantra Accounts for 41 Percent of CARS Deals; Ford Tops List of Clunkers, Comprising 32 Percent of Trade-ins
FOUNTAIN VALLEY, Calif., July 10, 2009; Hyundai became the first automaker to honor the government's "Car Allowance Rebate System" (CARS) incentives on July 2 and the novel consumer incentive program, also known as "cash for clunkers," accounted for seven percent of Hyundai sales in its first week. Nearly a third (32 percent) of the trade-in models reported by dealerships were Ford vehicles, followed by Dodge (23 percent). Lexus, Jaguar, and Mercedes-Benz are among the other brands delivered as "clunker" trades, demonstrating both the broad appeal of the government program, and the changing nature of Hyundai's product line and buyer demographics. Hyundai's rollout enables buyers to receive the full rebate allocated under the CARS program (also known as "cash for clunkers") when an eligible trade-in is exchanged for a qualifying Hyundai model at a participating Hyundai dealership.
The fuel-efficient Hyundai Elantra was the most popular model purchased under the CARS program, making up 41 percent of sales. Elantra recently earned top honors in the 2009 J.D. Power and Associates Initial Quality Study for the highest initial quality in the compact car segment, and is a "Top Pick" from Consumer Reports. With manufacturer incentives and a full CARS rebate for a qualifying "clunker," consumers can purchase a new Elantra for as little as $8,620. Sonata (29 percent) and Accent (16 percent) ranked second and third, respectively, in CARS transactions in the opening week.
"The early response we're seeing demonstrates the CARS program is working, with inefficient gas guzzlers being traded-in for fuel-efficient Hyundai models," said John Krafcik, president and CEO, Hyundai Motor America. "We expect overall sales from this program to grow as consumer awareness increases - it should surpass ten percent of our retail sales this month."
Hyundai is the first automaker to extend the government incentive to consumers, accelerating its implementation by several weeks by backing dealerships with short-term cash advances as the government organizes the rollout of the program industry-wide. Under the CARS program, consumers qualify for a $4,500 rebate on the purchase or lease of new vehicles that achieve 10 miles per gallon more than a trade-in car or five miles per gallon or more than a trade-in light truck. New vehicles that achieve between 4 to 9 mpg more than a trade-in car, or 2 to 4 mpg more than a trade-in light truck qualify for a $3,500 incentive. See www.cars.gov for complete details.
Thirteen Hyundai models and engine combinations qualify for the CARS incentive program, which requires passenger cars achieve 22 mpg or more combined fuel economy, and light trucks achieve 18 mpg or better combined fuel economy.
-- Elantra Touring
-- Sonata 2.4L
-- Sonata 3.3L
-- 2010 Genesis Coupe 2.0L
-- Tiburon 2.0L
-- Tucson 2.0L
-- Tucson 2.7L
-- Santa Fe 2.7L
-- Santa Fe 3.3L
Five Hyundai models achieve 30 miles per gallon or more on the highway -Accent, Elantra, Elantra Touring, Genesis Coupe 2.0L and Sonata 2.4L. Hyundai ranks third in corporate average fuel economy according to the U.S. Environmental Protection Agency, so consumers will realize further cost savings by stepping into a more fuel-efficient model than they currently drive.
The CARS incentive program complements all existing special incentives and financing options from the manufacturer, including Hyundai Assurance, which allows consumers to return their vehicle if they unexpectedly lose their income, and Hyundai Assurance Gas Lock, which offers a year's worth of gas at a guaranteed price of $1.49 per gallon. Visit www.HyundaiAssurance.com for details.