Chrysler's new CA$H incentive program will double the maximum credit offered under the government's new Cash-for-Clunkers program - to a maximum $9,000 - on vehicles like this Jeep Wrangler.
Hoping to kick-start its lagging sales, now that it has emerged from bankruptcy, Chrysler Group will offer to double the government’s new Cash-for-Clunkers subsidy, meaning incentives of up to $9,000 on “eligible” Chrysler, Dodge and Jeep products.
The “Double CA$H for Your Old Car” program is the first big incentive campaign since the “new” Chrysler emerged from Chapter 11 protection, little more than a month ago. The smallest of Detroit’s Big Three has been hard hit by consumer concerns about its health – June sales plunging 42%, the worst of all major manufacturers.
The Double CA$H promotion coincides with the launch of the federally-funded Car Allowance Rebate System, or CARS program. Those who qualify, trading in an old, low-mileage vehicle for a new, higher-efficiency model, can collect a federal voucher worth as much as $4,500 towards the new vehicle.
Chrysler, however, will provide incentives up to $4,500, “even if they don’t have a vehicle that qualifies under the U.S. Government’s program,” said Steven Beahm, the automaker’s vice president of sales operations. Buyers can opt for an alternative 72-month loan at 0% financing.
July 23rd marks the official start of CARS – better known to consumers as the Cash-for-Clunkers program. In a nutshell, government credits will be offered on vehicles no older than 25 years, and that have been registered to the current owner for at least a year. Depending on the amount mileage improves on the trade-in, a buyer can receive a federal credit of $3,500 or $4,500.
Somewhat similar “clunker” programs have been used to effectively stimulate sluggish new car sales in Germany and other markets, in recent months. The federal government has capped the potential payout of the CARS program at $1 billion, which means the money could run out within the next couple months, according to industry analysts.
Chrysler isn’t the only automaker hoping to piggyback on the clunkers campaign. Earlier this month, Hyundai announced it would begin offering credits to qualified buyers even before federal authorities had determined the precise rules of the CARS program.
How well Chrysler will do with its CA$H campaign remains to be seen. Because of their relatively low mileage, the automaker’s truck line-up is less likely to win over buyers seeking clunker payments than other manufacturers, industry analysts caution.