Summer Sales and Incentives

A Small Tick Upward?

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As I type this, June's sales results are starting to trickle in. My expectation is that we are going to continue to see poor sales through July and the vacation months. While I also believe that pent-up demand is growing, the summer months are traditionally slow.

New incentive programs from Hyundai ("Gas Lock," which holds one year of fuel to the price of $1.49), a free credit card to cover fuel costs through the Summer on the Suzuki's SX4, and zero percent six year financing from GM on certain models will serve to push interest in new car purchases, but they will not break the seal. I think we will see the first real signs of recovery in late fall.

An often overlooked issue is the fact that many new drivers are struggling to get credit approval or lease options. Much of the crazy growth seen during the first part of this decade was fueled by free-wheeling financing and aggressive lease programs that are not available today.

In contrast to this bad news is that certain vehicles are bright spots thanks to emotional rather than rational demand--the new Chevy Camaro, Dodge Challenger, Ford Mustang, Jeep Wrangler and Toyota Prius. Next up to test consumers' emotions are the all-new Ford Taurus, Chevy Equinox, Buick LaCrosse and Cadillac SRX.

Posted on 2009-07-01 | Permalink | |

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