Automakers Say "Thank You" To Service Men and Women with Rebates
Automakers Court Military Personnel With Rebates and Simpler Deals
Toyota, Kia, Suzuki, Hyundai, Ford and Chrysler are offering members of the armed services $500 rebates. The savings from GM could be $2,000 or more, now that the automaker is tailoring its military rebates to its different models and increasing them in many cases.
Service members can usually pile the military discount right on top of the regular rebates and special financing that may be available.
With 1.4 million members on active duty and millions more in the retired and reserves, the military represents a huge market to automakers, with tastes that mostly mirror the mainstream market.
"This is an extremely important market to us, and our program is growing every year," said Joanne Hogan, program manager with Ford's military appreciation program. "We do a lot of marketing on military.com and on the bases.
U.S. Military Like Ford Trucks and Asian Cars
Do soldiers, sailors and flyers go for Detroit sheet-metal more often than imports? The preference is for pick-up trucks among active military skews the market slightly toward Detroit, since Ford, GM and Dodge dominate the full-size truck market. According to ZAG, an automotive research company and AOL Autos partner, the Ford F-150 is the number-one vehicle among active military. But only three of the top ten vehicles purchased by active and retured military are from Detroit. ZAG's findings are based on data from military- and veterans-related purchasing programs this year.
The military programs for these customers vary greatly in their criteria. While all include active military, some individual programs include reservists, family members or veterans as well. Some car companies put an expiration on specific deals while others continue them across the board from month to month.
Automakers occasionally make these deals available to veterans of the armed services who did not serve the 20 years needed to formally retire from the military.
Hyundai established its program several years ago and recently expanded eligibility to veterans with at least four years in uniform. That opened it up to millions of former military from the Vietnam and other eras. Participation has soared, company spokesman Miles Johnson said.
"We feel so strongly about the contributions of our military that we enhanced our program in 2011," he said.
It seems to be a good fit for the Korean carmaker, which is now making vehicles in Alabama: the Hyundai Sonata ranks 10th on ZAG's list.
In March, Hyundai's sibling company, Kia Motors, was offering $500 rebates on the 2011 and 2010 Forte and the 2010 Optima sedan. The Kia program is for military members on active duty and their spouses and children.
Toyota generally has a $500 rebate for military customers, but it can be more than that on some models. One example was the $1,000 rebate it was offering on its Venza crossover in March in much of the Midwest. The Toyota subsidiary Scion has a $1,000 rebate for service members, provided that the vehicle is financed or leased through a Scion dealership.
Not All Automakers Court the Military
For their part, Honda and Nissan don't have military discounts. Honda is apparently doing well enough without them: three Hondas – the Accord sedan, the CR-V and the Civic sedan – are in fourth, sixth and ninth place among customers served by veteran and military programs, according to ZAG. It is surprising that they score so high with veterans without the price break.
Nissan, however, could use a push if it wants to gain ground with the military. Its Altima was the only one to make it into the top 25 on the ZAG list.
Ford offers a $500 bonus toward the purchase or lease of new Ford or Lincoln vehicles, although it excludes its hybrid vehicles, as well as the high-performance Mustang pony cars that would be a natural fit for service personnel looking for a little zip in their rides after driving big bulk hulking Humvees.
Ford recently added early enlistees and new retirees to the list of eligible recipients. Individuals who enlist but delay their entry qualify for the incentive even before they take the oath. Retirees are eligible as much as 180 days into their new civilian lives.
Chrysler is currently offering a $500 rebate for active military and reservists as well as retirees with 20 years of service on virtually all vehicles. The incentive probably wouldn't make that much difference on the one vehicle being excluded: the $90,000 Dodge Viper.
GM broke ranks with its rivals in 2008 and began offering deals tailored to the individual model lines. Linda Stouffer, the marketing manager for the automaker's military program, said it is now open to spouses – an advantage to military families when the husband or wife is deployed. In GM's incentive jargon, members of the Armed Forces get "preferred pricing."
"In the previous program, the savings were set at $500," she said. "But now it varies depending on the vehicle." Currently, the discount is nearly $400 on the Cruze, Chevy's new compact contender, but $2,000 on the Chevy Avalanche. Buyers also can save more than $1,200 on a Buick Enclave, nearly $700 on a Buick Regal or about $2,000 on a GMC Sierra . Standard rebates are added to those amounts.
Other changes at GM have been designed to make the purchase more friendly for their uniformed customers. After building their vehicle on the GM website, www.gmmilitarydiscount.com, they receive a set, no-haggle price that already includes the discount.
"For our military, we wanted to take out all the stress, and let them know what they're going to pay when they walk in into the dealership, " Stouffer said.
Reducing stress in a new-car purchase for people who have done so much for their country already seems like a good idea.
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