Dealers are feeling the pressure of lower sales volumes in March as the negative impact of the COVID-19 pandemic slows foot traffic to dealerships, Saif Kadri, sales manager of Carson Nissan in Carson, Calif., told Auto Finance News.
To that end, dealers are urging more automakers and their captive finance arms to offer incentives on the heels of General Motors’ announcement offering well-qualified borrowers interest-free financing — via GM Financial — for 84 months, with deferred payments for up to 120 days.
One Memphis, Tenn.-based dealer told AFN that GM has “led the pack with the most aggressive program to date.” Kent Ritchey, president at Landers Ford Lincoln Mercury, said the dealership also works with captives Ford Motor Credit and Nissan Motor Acceptance Corp. “We’ve gone to all of our full-time lenders and asked for deferred interest rates,” he noted.
At press time, Nissan had not issued any official incentive announcements, but dealers are expecting incentives to come by the end of the week.
“If GM is going to do something like that, everyone else is going to follow their path,” Carson Nissan’s Kadri said. “My general manager is ready to advertise 0% financing for a 72-month term with good credit.”
Hyundai Capital America, for one, relaunched its Hyundai Assurance program this week. “In 2009 we launched Hyundai Assurance to help protect owners who lost their jobs,” the company noted on their website. “In response to recent events, we’ve brought it back.”
With Hyundai Assurance, the captive is covering up to six months of payments for Hyundai owners who purchased or leased a vehicle between March 14 and April 30, if they lose their job due to COVID-19 this year. Moreover, the captive is offering a 90-day deferred payment available only on new purchases of Hyundai vehicles financed at 0% APR.
Other OEMs and captives are gearing up their incentive programs as a result of lower sales volume due to coronavirus impact. Ford Motor Credit, for one, announced a program that gives customers buying a new vehicle the option to delay their first payment for 90 days. Toyota Financial Services is providing payment relief options to customers affected by the virus.
New vehicle sales are expected to clock in at 16.4 million this year after adjusting for coronavirus impact, down -500,000 vehicles or -2.9% from initial 2020 forecasts and down 3.8% from 2019 sales, TrueCar’s ALG reported Monday.
