Auto dealers see hope in new incentive programs
Advertiser Staff and News Services
DETROIT — General Motors Corp. and Ford Motor Co. launched new marketing programs yesterday that feature zero-percent financing as well as cash rebates in hopes of clearing dealers' inventories of remaining 2002 model-year vehicles.
The nation's two biggest automakers had each dropped zero percent financing programs earlier this year after using no-interest loans to stimulate sales in the aftermath of the Sept. 11 terror attacks.
Second-quarter figures for Hawai'i were not available yesterday, but auto officials said they expect the results to be strong. For the January through May period, Hawai'i auto dealers saw retail registrations rise 9.7 percent over the same period last year, according to Eric Miyasaki, president and chief executive officer of Nissan Hawaii.
"It's much more than we ever forecasted," said Miyasaki, who said business at his company jumped 25 percent over previous-year levels despite no special offers such as zero-percent financing that are being offered by other dealers. "We're in the position of being short of inventory."
But Miyasaki noted that in Hawai'i as much as 45 percent of car registrations could be rental or fleet cars, many of which are later auctioned on the Mainland. Thus, these registrations do not necessarily represent sales. Fleet registrations from January to May actually declined 15.8 percent from the same time last year due to the decline in tourism after Sept. 11.
A combination of retail and fleet registrations represents the total market, which fell 2.5 percent from 2001, said Miyasaki.
Still, Dave Rolf, executive director of the Hawaii Automobile Dealers Association, predicts a strong market for automobile sales in Hawai'i through the end of the year.
"I think that we'll have a continued climb in Hawai'i that will probably outdistance the Mainland," he said.
Last year, new auto sales in Hawai'i had been on pace with 2000 — the best year in Hawai'i sales in a decade. But after the Sept. 11 attacks, rental-car companies bought 7,624 fewer cars from local dealers, so for the year auto sales were down 9 percent compared to the previous year.
GM's program, called "Summerdrive," offers no-interest financing on loans up to five years for qualified buyers on new 2002 Buick, Cadillac, Chevrolet, Oldsmobile, and Pontiac-GMC cars and trucks through Sept. 3.
Saturn, Hummer and all 2003 models are excluded.
For the Chevrolet Corvette, interest rates range from zero for a three-year loan to 2.9 percent for five years.
Cash rebates also are available from $1,000 to $3,000 depending on the vehicles.
Ford's "We Will Rock You" program offers cash rebates of as much as $3,000 and financing as low as zero percent on some vehicles.
The rebates range from $500 on the Ford Escape to $3,000 on the Windstar minivan and Crown Victoria. The Ford Thunderbird is not included.
Rebates of $1,000, $1,500, $2,000 and $2,500 are available on other models.
Zero-percent financing is available for 36-month loans on the Crown Victoria, Econoline van and F-Series Super Duty pickups.
The lowest rate for all other vehicles except the Escape and Thunderbird is 0.9 percent for 36 months.
Longer-term financing carries rates from 0.9 percent to 4.9 percent, depending on the vehicle.
A combined cash and reduced financing rate option also is available on most models, the company said.
Returning lease customers also are eligible for loyalty bonuses of $1,000 to $1,500 on all Ford brand models except Thunderbird and SVT models.
Lease loyalty bonuses can be applied toward a new lease or retail purchase and can be combined with the cash rebates or financing rates being offered.
Ford's new program runs through Sept. 30.
On the New York Stock Exchange, GM share fell 32 cents to close yesterday at $50.50 while Ford shares climbed 24 cents to $15.76.
Advertiser staff writer Katherine Nichols contributed to this report.
