Ford, GM unveil payment protection plans
Under Ford's Drive One program, Ford will cover 12 monthly payments of $700 each for buyers of new Ford, Lincoln or Mercury models who lose their jobs. Under GM's Total Protection plan, customers can get payment protection for the first 24 months of ownership. GM will make up to nine payments for as much as $500 a month for people who lose their incomes.
If this sounds familiar it should. As anyone with a TV set knows, Hyundai has been touting a similar offer for months. Interestingly, so far it appears few people have taken advantage of it, according to Kicking Tires.
Could it be that the 55,1333 people who purchased a Hyundai are all gainfully employed? If that's true, that's good for them. Perhaps Hyundais are so heavily discounted that they are too good to pass up. The carmaker is offering rebates of as much as $2,000 on certain models. North American sales of Hyundais fell 1.5 percent in February, which compared with the double-digit declines at the Big Three is outstanding. The 25 percent surge in sales between January and February is even more remarkable.
Ford is in a different situation than Chrysler. The Dearborn, Mich-based company is proud that it does not need a government bailout, though some analysts think it might need one eventually. Monthly sales are expected to have plunged for a third month in a row, according to Bloomberg. Ford is expected to show a decline of 45 percent, below the 46 percent drop-off at Chrysler and the 48 percent decline at General Motors.
The sad fact is that people are so scared to buy cars that automakers can only unload them with unprecedented discounts and consumer protections that no viable business can maintain.