Cash-for-Clunkers trade-ins account for 7 percent of Hyundai sales in first week
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.
[Source: Hyundai]
PRESS RELEASE
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.
-- Accent
-- Elantra
-- Elantra Touring
-- Entourage
-- 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
-- Veracruz
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.
Reader Comments (Page 1 of 2)
Andre 5:49PM (7/10/2009)
* Your vehicle must be less than 25 years old on the trade-in date
* Only purchase or lease of new vehicles qualify
* Generally, trade-in vehicles must get 18 or less MPG (some very large pick-up trucks and cargo vans have different requirements)
* Trade-in vehicles must be registered and insured continuously for the full year preceding the trade-in
* You don't need a voucher, dealers will apply a credit at purchase
* Program runs through Nov 1, 2009 or when the funds are exhausted, whichever comes first.
* The program requires the disposal of your eligible trade-in vehicle and that the dealer disclose to you an estimate of the scrap value of your trade-in. The scrap value, however minimal, will be in addition to the rebate, and not in place of the rebate.
With that, are those cars listed for trade from the consumers getting less 18mpg gallon!?!? I don't think so.
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inv4zn 5:52PM (7/10/2009)
What?
FitFan 6:08PM (7/10/2009)
I agree Andre.
I don't think Lexus has ever made a car that gets less than 18mpg combined. The very first year LS400 got 18/23. Maybe with the adjustment to the new testing cycle it would get just under 18 combined.
On top of that, how many Lexus, Jaguar and MB vehicles are worth less than $4500 on the used market?
Greg 6:42PM (7/10/2009)
A 3 second Cars.com search shows me that a ton of early 90s MB E Class and XJ6 < $4500.
British_Rover 9:54PM (7/10/2009)
Umm you realize it is 18 mpg or less combined for the clunker to be traded in. Go look at the fueleconomy.gov site both the ES250 and LS400 are 18 mpg combined using the new EPA ratings.
Also cars can be up to 25 years old and just about any Jag from the mid 80s up to the early and possibly mid 90s will be worth less then $3,500 bucks.
Same thing just about any Lexus from the late 80s and early 90s will also be worth less then $3,500 bucks.
Then of course you forget the LX470 which would also easily qualify under the CARS program.
AMcA 10:56AM (7/11/2009)
Cash for Clunkers - they don't need a gov't program for that at Hyundai. That's what the normal transaction at a Hyundai dealer is.
Cash, or trade-in plus a 7 year year loan. Or worse.
the4thheat 2:02AM (7/12/2009)
You have to have one of the very oldest LS's for this trade to make sense...either that or a really beaten down LS that needs a really expensive repair or something.
The ES250 is a no brainer to trade but I seriously think there's idiots trading in LS worth more than the $4500 just because other dealerships probably tried to lowball them on a tradein previously or something.
There's probably a whole bunch of cars being sent to the crusher that were actually worth more than the stupid rebate. Ugh.
Erik 6:05PM (7/10/2009)
It would be awesome if the government pulled funding for this aweful program at the last minute and Hyundai had to eat the rebates it had prematurely given customers.
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KT 6:56PM (7/10/2009)
Hyundai needs to careful and hope the gov doesn't throw some extra conditions on the deal before it's "officially official". Those dealers taking the early trade-ins better be going above and beyond to make sure they aren't "fudging" any of the rules to get these deals down. If they are they could be holding the bag for all that rebate money.
Whenever you're dealing with the gov, you better expect to get screwed somehow. This will be no different. Notice the other makers aren't talking the chance...if it was such a cut and dry program I believe everyone would be taking early trade-ins.
inv4zn 6:16PM (7/10/2009)
What?
...this time, to FitFan
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Mark 6:23PM (7/10/2009)
It's good to see my tax dollars going to help Korea. Makes me proud to be an American. Sigh.
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Tristan OTierney 6:33PM (7/10/2009)
You ever think it's the American car companies fault for making gas guzzling tanks, in addition to poor management? The only car companies failing internationally right now are US based.
fooznugget 7:35PM (7/10/2009)
The program is open to every automaker. I know that the program is not the best example of capitalism but Hyundai being ahead of the curve on this and people being able to spend their money how they choose is a great example of capitalism.
It seems like Hyundai has been a leader in the market recently with setting several trends (warranty, setting safety standards, the assurance program). By taking the trades early, I think it's just another example of what they're doing right and I think they deserve all of the attention that they've been getting recently.
futurama 7:43PM (7/10/2009)
hmmm.. Sonata is made in America... and Hyundai America employees how many 'Americans' in America?
Doesn't your uncle work at Hyundai Dealership as a car washing staff??
ok.. that was cruel. :p
drcruelty 2:09AM (7/11/2009)
Gas guzzling tanks? They sell tanks??? I want one!!
Sorry, that's as seriously as I can take the US Senate gas guzzling comment. I suggest you forget anything CNN tells you about automobiles.
LesPaul1 2:07PM (7/11/2009)
Funny, because your spending on gas goes to middle east and it's peanuts compared to that... and that doesn't seem to bother u.
Conundrum 6:26PM (7/10/2009)
Hyundai taking a risk... I like that! Taking risks has profitted Hyundai in the past so they will continue the practice until it bites them in a big way.
Poor quality perception = Offer one heck of a warranty
Unemployment & car sales slump = Offer a deal to aid people who loose thier job
Cash for Clunkers coming soon to a dealer near you? = Step out of the gate early and get those sales before someone else does
Hyundai is small enough in the US that they can still operate like an entrepreneurial small bussiness and benefit. When they become a large presence in the US (like Toyota/ GM/ Ford) they may not take quite as many risks.
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mr.ed 8:01PM (7/10/2009)
This should have been limited to new North American built vehicles only.
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Conundrum 9:25PM (7/10/2009)
Yes it would be nice to see the congress of the United states using the American taxpayer's money to support American companies and workers.
Built in the USA by a domestic = best for the taxpayer
Built in the USA by an import company = OK
Built in Mexico/ Canada by a domestic company = eh...OK
Built in Mexico/ Canada/ Japan/ Korea by an import company = NO in my book.
Sales jobs, transportation, and financing are the general rule for all cars. My tax money should give incentive for something as beneficial as possible to my fellow Americans. Does congress not care about the 10% unemployment?
Level 10:50PM (7/10/2009)
True I agree while other countries put forth extreme rules to benefit and protect their domestic markets, the US on the other hand is a 5 dolla hore lol....Look at the EU and their import tarrifs which makes a 30K Camaro cost 50K or China can't sell a car their with out domestic part ownership and share in the profits and lets not forget about Japan and their import laws...