Hyundai has offered an escape plan to cash-strapped consumers lost in this economic recession.
The automaker this week unveiled an incentive program that allows U.S. consumers to return Hyundai vehicles within the first year of purchase if the buyers lose their job and can’t make payments.
“We’ve had some phone calls and some people come in and ask about [the program],” said Bob Stroud of Thompson Hyundai in Baltimore. “Consumers are really enthused about it.”
» Chrysler down 53 percent
» Hyundai down 48 percent
» Toyota down 37 percent
» Honda down 35 percent
» Ford down 32 percent
» General Motors down 31 percent
» Nissan down 31 percent
The plan comes at a time when U.S. auto sales plunge under the pressure of tight credit and weak consumer confidence.
“We understand consumers’ hesitance to commit to large purchases in today’s economic environment,” John Krafcik, Hyundai’s acting president and chief executive officer, said in a statement.
Hyundai 10 years ago began offering a 10-year, 100,000-mile warranty that helped drive sales. The strategy helped Hyundai become the fastest-growing major automaker earlier this decade, but the company fell short of sales goals in 2007 and 2008.
Bruce Schindler, of Bob Davidson Ford in Towson, said consumers are clearly hesitating with car purchases, but he wasn’t sure how much the promotion would help Hyundai sales.
“If you look at the number of people unemployed, and then try to figure out how many of those people own a Hyundai, I’m not sure it’ll have a significant effect on the economy,” Schindler said.
“It seems to me that Hyundai’s downside potential isn’t that significant, and they’re certainly getting their name out there,” Schindler said.
The “Hyundai Assurance Program” is complimentary for one full year, covers all new Hyundai models and is available to everyone.
The plan allows consumers to walk away from a financing obligation when certain “adverse life events” occur. Customers must also have made at least two payments on the car already. In addition, Hyundai will only refund the depreciation on the returned car up to $7,500.
Covered circumstances include involuntary unemployment, physical disability, loss of driver’s license due to medical impairment, international employment transfer, self-employed personal bankruptcy and accidental death.
