On July 10th Hyundai Motor America released some initial data from their early start of selling cars under the Cash for Clunkers bill.  According the Hyundai, in the first week of sales under the Car Allowance Rebate System (CARS) draft rules, clunker deals represented 7% of their new car sales. 

Many car dealers are waiting until July 23rd to official start selling cars under the NHTSA program since registration and rules have not been finalized.  Hyundai bucked the advice of the NADA and NHTSA and created a program to advance their car dealers with $4,000 per qualifying sale to hold them over until the government can reimburse them through the official process.  This decision looks like it is paying off for Hyundai.

Trade-In Predictions Confirmed

On July 9th, we published a trade-in prediction survey showing that the top three cars that will be exchanged under the Cash for Clunkers bill would be Ford, Chevrolet and Dodge.  According to Hyundai dealer sales, their top brand that was traded in was Ford and Dodge was second.  This initial data from Hyundai dealers supports the predictions of  our survey over over 22,000 consumers who qualify for a CARS credit.

Low Price Incentivized Cars Will Rule

Hyundai sales data provided in the press release also gives confirmation of what we have been predicting; consumers will also be looking at manufacturer rebates to determine their final car choices. The top seller for Hyundai dealers was the Elantra which in many regions has additional $2,000 manufacturer incentives attached.  The combination of  Hyundai incentive packages and a $4,500 CARS credit can deliver a new Hyundai for as low a $8,620. 

Hyundai Qualifying Models

With Hyundai having a three week advance start to tap into pent-up consumer demand, these thirteen Hyundai models and engine combinations that qualify for the CARS incentive program could be in short supply:

 Accent, Elantra, Elantra Touring, Entourage, Sonata 2.4L, Sonata 3.3L, 2010 Genesis Coupe 2.0L, Tiburon 2.0L, Tucson 2.0L, Tucson 2.7L, Santa Fe 2.7L, Santa Fe 3.3L

Running Out of Money

We are predicting that the $1 billion dollars in funding for the CARS program will not last until November 1, 2009.  From our survey of veteran car dealers, the funding for the program will run out by Labor Day weekend. That would leave September and October car shoppers locked out of any new car credits under the CARS provisions.

If additional funding is needed, Congress would have to approve that spending.  A new online petition has started to ask Congress to modify the rules of the CARS program if additional funding is requested.   One of the suggested revisions is a NET-10 rule.

 To sign-up for the Cash for Clunkers petition, visit:  http://www.nocashforclunkers.com