Cash for Clunkers spinoffs
Despite some early confusion and obstacles, it’s clear that the Cash for Clunkers program has been a boon to auto dealers in the United States. While “parting out” firms complained that the requirement that clunker engines be siezed up when traded in cost them money, wasn’t that the ecological point of the program?
Now that the CARS program is about to expire, clones and offshoot programs may be emerging – one already has. When the story broke that dealers were pulling out of the CARS program due to slow federal government payments, General Motors stepped in to make the payments to its dealers and keep them taking the clunkers as trade ins. Now, there’s AutoStimulusPlan.com – a program that includes 79 U.S. dealerships so far. Automotive News gave us the first glimpse of the plan.
Begun by Sean Wolfington, co-founder of Level 5 and Tier 10 Marketing in Dulles, Va, the program primarily includes larger auto dealerships, as many small dealerships have run out of inventory. The dealer program has fewer restrictions than the government plan. For example, leases can be for terms shorter than the federal 60-month minimum and there is no ceiling on the new vehicle price. The dealers require that the vehicle being traded be older than a 2006, be in working condition, and have been owned and registered by the new car buyer for at least six months. The new purchase must improve the mpg by at least two miles, though there is no minimum mpg for either vehicle, and if the improvement is 5 mpg or more the trade-in bonus improves.
We talked in CIR 10.15, August 6, 2009, about the obstacles for auto dealers in this economy – red flag rules and tightening bank funding – and encouraged publishers to look for ways to help auto dealers. Well, here is one. Local publishers can help bring their DMA’s auto dealers together for their own AutoStimulusPlan.com, or classified networks can expand this concept beyond the local region. It may mean offering the publisher’s site as the online home of the project, or providing free advertorial content about the promotion with added paid advertising opportunities. It might mean hosting the planning meetings. We’re not sure. But it’s clear that auto dealers have benefited from Cash for Clunkers and they don’t want to see the concept die. Helping them keep it or something similar alive could be about boosting automotive publishers’ bottom lines as well.
