Get this! Imagine you could buy or lease a car for three years and have a guarantee that for up to 12,000 miles a year or 36,000 miles over three years that you would pay $2.99 at the pump regardless of where gasoline prices are trading in your neighborhood?
Sound too good to be true? Perhaps! This morning Chrysler’s Vice Chairman Jim Press joined me to discuss this new announcement by Chrysler to help the American consumer fight rising gas prices. Chrysler revealed this plan today and it’s worth taking a look at it if you are in the market to buy a car.
The way it works…you can go to any Chrysler dealer or go to their website at http://www.chrysler.com for details but you go in, pick a car, purchase it or lease it and receive a credit card from Visa or MasterCard with the $2.99 cents a gallon pricing. You can use that credit card in any gasoline station across the country and you will be guaranteed $2.99 cents a gallon regardless of what the national or local average is in your community.
Two points worth noting:
1. Not all Chrysler vehicles are included: Some high power, more expensive cars are not included in this promotion.
2. When you sign this deal, you lock in a price of $2.99 cents for the next three years. If gasoline prices go below that, you don’t get the opportunity to re-adjust those prices although I’d assume you could choose not to use the Visa/MasterCard that they supply you with and pay for the cheaper prices with your own credit card or cash.
It appears to me on the surface that this investment is a hedge for the American consumer. Why not get capped out at $2.99 cents a gallon? Yes, Chrysler is doing this to sell cars, clean out inventory and reach the American consumer while the company faces huge lay off’s and growing financial concerns. They recently started, as of a couple days ago, having executives and directors, in fact the top 300, call Chrysler costumers in a program called Customer First Program to check in on their customers and see if their satisfied. So yes, it may be a marketing ploy or strategy but it’s also a pretty good one!
d.loch,
You are assuming that you have to finance through Chrysler.
Also you don't lose the rebate, for example if you were to buy a dodge charger you get 2,000 gallons of gas spread out over 3 years (about 667 gallons per year) and an additional $1000 rebate and in certain areas of the country an additional $500 rebate.
May 7, 2008 at 3:43 pm
CCJENS
It sounds to me like a great deal for Visa and Mastercard since the consumer will be using their credit card to put gas in the consumers car. Now, I'm no economics professor, but in my limited knowledge of people's spending habits, I can envision people leaving a rolling balance on their credit card from putting gas in their car, and thus getting charged interest on this gas.
Maybe I should think less about investing in oil futures, and think more about Visa and Mastercard as an investment.
May 7, 2008 at 1:47 pm
Chrissy
So what about people who already own a Chrysler/Dodge vehicle? This offer should extend to people who already have a car through Chrysler and are eligible for this credit card. Or is it just for new purchases/leases?
May 7, 2008 at 9:55 am
d.loch
Go figure:
Lets say take the Gas Card and run with it. Give up the 1500 rebate. Now if you finance, and even at 60 months for lets say 6.9% you will pay an additional about $300 in interest that you would not have paid had you used that as a down. Ok so now lets take that $300 off that gas savings... Sorry Chrysler it still does not hook me.
May 6, 2008 at 8:47 pm
stephenlee
If chrysler goes bankrupt, will the 2.99 gas be guaranteed or not? Present CEO did poorly at Home Depot, so how can we expect him to do any good at Chrysler. Better to drive the car you want that will give you a good MPG than achrysler car that nobody seems to want!
Steve
May 6, 2008 at 2:13 pm
d.loch
Lets be honest here and see the whole picture.
As an example Its an either or situation. As in a rebate or the gas credit card.
With a pre-determined amound spread over the next 3 years, with a limit per year.
Use it or lose it.
Come on Chrysler show us some real customr concern.
How about a rebate of $1500.00 and A gas Card of even $1000.00 would make me consider
a Chrysler over some other car. I give this 30 days to show you that you are missing
the point. Get your VP's out of their plush offices and not on Phones, but at the
dealerships and see what the customers really want.
May 6, 2008 at 2:09 pm
chuck
I just read in Yahoo finance off the Drudge Report that Goldman Sachs has now rocked the market with thier prediction of $200 a barrel oil. The markets are rocking to this news and it this may not bode well on Mainstreet at all. Now here in Vicksburg ms the gas prices haven't risen at at all to 3.60. They're remain consisant from 3.49 to 3.53. In fact the prices drop a few cents over the weekend.
May 6, 2008 at 1:51 pm
Yonah
Alexis,
This is all well and good, and clever marketing too. This might cost Chrysler $1000/per year/ per car, and that is a lot better for Chrysler and its dealers than having cars sit in dealer lots. However, what if Gas goes up to $6/gal in the next 2 years? That can add up to a lot of extra costs for Chrysler, and what happens if the company goes under?
May 6, 2008 at 1:35 pm
aboutthis blog
Alexis Glick is an anchor for FOX Business Network. Prior to joining FOX, Glick served as a correspondent for the Today Show and co-anchored the third hour of that program. Before her stint at NBC News, she was the senior trading correspondent for CNBC and reported from the floor of the New York Stock Exchange.
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Steve
d.loch, You are assuming that you have to finance through Chrysler. Also you don't lose the rebate, for example if you were to buy a dodge charger you get 2,000 gallons of gas spread out over 3 years (about 667 gallons per year) and an additional $1000 rebate and in certain areas of the country an additional $500 rebate.
CCJENS
It sounds to me like a great deal for Visa and Mastercard since the consumer will be using their credit card to put gas in the consumers car. Now, I'm no economics professor, but in my limited knowledge of people's spending habits, I can envision people leaving a rolling balance on their credit card from putting gas in their car, and thus getting charged interest on this gas. Maybe I should think less about investing in oil futures, and think more about Visa and Mastercard as an investment.
Chrissy
So what about people who already own a Chrysler/Dodge vehicle? This offer should extend to people who already have a car through Chrysler and are eligible for this credit card. Or is it just for new purchases/leases?
d.loch
Go figure: Lets say take the Gas Card and run with it. Give up the 1500 rebate. Now if you finance, and even at 60 months for lets say 6.9% you will pay an additional about $300 in interest that you would not have paid had you used that as a down. Ok so now lets take that $300 off that gas savings... Sorry Chrysler it still does not hook me.
stephenlee
If chrysler goes bankrupt, will the 2.99 gas be guaranteed or not? Present CEO did poorly at Home Depot, so how can we expect him to do any good at Chrysler. Better to drive the car you want that will give you a good MPG than achrysler car that nobody seems to want! Steve
d.loch
Lets be honest here and see the whole picture. As an example Its an either or situation. As in a rebate or the gas credit card. With a pre-determined amound spread over the next 3 years, with a limit per year. Use it or lose it. Come on Chrysler show us some real customr concern. How about a rebate of $1500.00 and A gas Card of even $1000.00 would make me consider a Chrysler over some other car. I give this 30 days to show you that you are missing the point. Get your VP's out of their plush offices and not on Phones, but at the dealerships and see what the customers really want.
chuck
I just read in Yahoo finance off the Drudge Report that Goldman Sachs has now rocked the market with thier prediction of $200 a barrel oil. The markets are rocking to this news and it this may not bode well on Mainstreet at all. Now here in Vicksburg ms the gas prices haven't risen at at all to 3.60. They're remain consisant from 3.49 to 3.53. In fact the prices drop a few cents over the weekend.
Yonah
Alexis, This is all well and good, and clever marketing too. This might cost Chrysler $1000/per year/ per car, and that is a lot better for Chrysler and its dealers than having cars sit in dealer lots. However, what if Gas goes up to $6/gal in the next 2 years? That can add up to a lot of extra costs for Chrysler, and what happens if the company goes under?