2.99 Gas Guarantee
May 29, 2008
Lets Refuel America! That’s the new slogan being rolled about being Jeep and Dodge as part of their $2.99 Gas Guarantee. Basically, if you buy their crappy, overpriced, gas guzzlers, they will subsidize your gas for the next three years.
This is disgusting on so many levels. First of all, if you can’t afford to buy gas, you shouldn’t be buying a new car. Secondly, I can’t think of anything worse than subsidizing gas prices. They are going to continue to go up pretty much forever. The longer we wait to get off of gasoline, the harder and more expensive its going to be to do it. Just for this campaign, I pledge never to buy a Jeep or Dodge ever again.
Did you read Thomas Friedman’s article on this?
that brings to mind the same thing GM did in 2006 that i covered here (http://chinadaily.wordpress.com/2006/07/01/clever-america-stupid-america/) except it was $1.99/gallon. wow, with gas prices what they are now that just sounds amazing, doesn’t it (not the GM car deal, just the gas price of $1.99)?
the logic just baffles me–because there is none–but apparently it works because people don’t care about stuff like actually being able to afford what they want to buy. kind of like ARMs and speculative real estate purchases. if you can’t afford it now, what makes you think you can magically conjure up more money one or two years down the road?
there are some people who can benefit from this (other than the car companies), namely those people who are in the market for those cars anyway and can actually afford to buy one. something tells me that isn’t the majority though.
Don’t forget that this deal is also limited to “the first 12,000 miles per year” and that manufacturer estimates on MPG is usually pretty inflated (not to mention that they’ll probably have fine print to calculate that 12,000 miles at highway gas mileage).
So if you buy one of their cars that gets 20mpg (or at least that’s what they tell you it gets), you only get that savings on 600 gallons of gas per year, and if gas is $4/gallon, it’ll save you $1800 over the life of the deal. Maximum. Oh, and don’t worry that the value of your $25000 gas guzzler will probably fall to about $14000 over that timeframe. Taking a huge hit on new vehicle depreciation is a small price to pay for cheap gas.
Daniel K - I actually read the Thomas Friedman article before I saw the commercials.
Deb - I don’t think anyone ever benefits from buying a GM.
Mark - I have to wonder, if GM does sell a lot of cars on this deal, how screwed they would be if gas prices shot up to 6 dollars. Although maybe there is something in the fine print about capping the amount they will subsizide at $4 per gallon.
Well, car companies typically do what ever they can to sell cars. I don’t see anything wrong with it. No one is making people who can’t afford cars buy them.
I’m sure the small print will make the deal pretty useless anyways.
andy:
“Deb - I don’t think anyone ever benefits from buying a GM.”
i would have to agree with you there! :-p
Trista - No one made people take ARMs and sub-prime mortgages and car loans. It doesn’t mean that offering them wasn’t still a really, really bad idea that ultimately proved to be somewhat destructive for our country.
Andy,
Nobody makes you use a cell phone. Or have a car. Or use the internet, or the metro, or wear clothing that most people would consider “modern” or any of those things. At some point, you do it because that’s the culture you live in.
OUR culture tells us to buy houses and cars and espouses them as such great values, such fantastic demonstrations of the American Dream, that people will be willing to do nearly anything, no matter how irresponsible, to get it.
Yes, in the end it comes down to the choices those people made. But it’s hard to deny that our culture of “buy everything you want!” doesn’t at least have something to do with it.
The suppliers, the people who supposedly REALLY should have known better, should never have made such loans available in the first place; more than that, they should have known better than to start trading mortgages as investment instruments (a practice that was illegal for nearly 80 years, by the way, and repealed by none other than President Clinton). That’s the real reason the sub-prime “crisis” became one in the first place - the failing mortgages started taking down investment banks. The whole country could file personal bankruptcy so long as the financial markets remain viable. The instant those markets start going bankrupt is when you know you have a problem.
@ deb, right now gas in good ol’ So Cal is 4.65 for regular; so you’re theory is pretty much out the window.
And I do admit D, C, and Jeep makes the crappiest cars on the road with horrible resale values, ergo I think that leasing them would be the smartest decision.
Consumer reports estimate by the end of this summer for the gas to be at least 5.75 only going upwards; so a subsidy of these advancing gas prices will be a much needed bandage for the gaping wound the oil companies have inflicted on us.
So im seriously considering purchasing a base model 2.7L charger or a small dodge caliber so that my gas will be 2.99 for the life of my lease
I’ll save you some financial woes now by telling you to go ahead and throw your theory out too there Peter R.
You think that leasing a poorly made car is the smartest decision? No wonder you’re seriously considering buying their cars for a the tax benefit on gas. Leasing a car is the worst way to have a vehicle, especially a bad one.
How about this: don’t lease a crappy car just to get cheap gas (and read the fine print on when the car company will actually buy that gas for you, because it’s not often). Buy a quality used car that gets good gas mileage, you’ll do better in the long run.
I’m with Jeff on this one First of all, if 5.75 for gas causing a “gaping wound” for you financially, you shouldn’t be buying, or even leasing, a new car. Second, you’ll save more money but getting a car with good gas mileage that costs less. And third, do you really think you have a better idea of what gas prices are going to look like at the end of the summer than the execs at GM who came up with this idea? The “subsidy” they give you is basically paid for by you in the extra cost of the car (this subsidy just doesn’t appear out of nowhere), so what your basically saying is that you are willing to place a crapload of money that the GM execs not only underestimated the cost of gas for the next three years, but didn’t throw some clause into the lease that protects them against $6 a gallon for gas.
Then again, maybe I’m wrong, in which case GM is so stupid that they just bet the future of their company on low gas prices. In which case, you REALLY don’t want to buy a GM, because they will go out of business, and no one will be able to repair your crappy car when it breaks down every three months.
I agree with Peter r. First off i dont get what all of you are blabbing about GM being bad quality. I SERIOUSLY WANNA HEAR ABOUT WHAT YOU DRIVE. You guys proly have some crappy ass japaneese so all you can do is talk crap. And if you know any shit about cars Jeff, you would know leasing is the best option, nothing can go wrong with a lease, everything can go wrong with a buy. At the end of the lease you give the car back and your done who give a shit about depreciation. Know what your talkin about before you start bsing like you know what your saying.
Ed, you need to follow certain principles before you write something. Things like learning how to spell will ‘proly’ help your case because the first thing any reader will do when they see your comment is think to themselves that you are uneducated and why should we listen to the illogical reasoning of an uneducated person?
As for cars, Japanese cars are far superior to American made ones, I’m sorry you live in denial about this. They are more fuel efficient, last far longer, are lower maintenance, and survive better in accidents.
One thing I know more about cars is finance. If you buy a quality car it will last years and by owning it until the car falls apart an owner will have spent less on the life of the car than on a lease. A lease will force you to buy a car on terms that you have to live up to and charge you when you don’t meet those terms. When you are done with the lease, the car has depreciated significantly (cars are among the fastest depreciating things you can buy) but your lease payment has offset the cost of that depreciation. Who cares if it’s depreciated? YOU should, because you’re the one being suckered into paying for someone else loss - you are paying them more than they are losing. If leasing is so great and the best way to own a car, how come rich people buy their cars outright?
You probably think that zero down payment with a 15% interest rate is a great deal too.
True. If you want to drive a different car every year, leasing is the way to go. But if you are going to drive the car for a long time, then buying is much more cost effective.
Welp, 4 days from my last comment gas is $4.83 for regular. Basically over 4 cents a day. 5.75 for diesel. So really a Dodge Caliber 36hwy mpg at 2.99 per gallon doesn’t seem all that “crappy” anymore.
However the theory that Chrysler bit off more than they can chew seems eminent. But how can we knock the fact that right now I could be saving 1.84 per gallon, only looking to save more.
Should i lease the “iffy” caliber for 12k 36mpg 2.99 gas
Or
Tried and True Civic 38mpg ?.99 gas
This promotion is over in exactly 30 days.. Come day 28 if gas is constantly rising at the rate it is now, then the Caliber HANDS DOWN will be my weapon of Choice.
PS. Costco has the cheapest gas :-)! (but there’s no such thing as cheap now days.
PPS
Caliber lease 179. per month
Civic Buy 299 per month
Leasing is not always a bad thing. I’m the kind of person who gets sick of a car within 2 years. So i lease. And depending on the money factor and residual value of a car, in many instances, leasing can be more cost effective. For example the last car i leased cost me 7000 for 2 years, but within 2 years the car lost more than 7000 dollars in value.
I am currently in the market to lease a new car. And although i agree that most American cars are generally crappy this deal does interest me. If i was going lease a a camry that gets 19/28 mpg i might consider an avenger that gets 21/30 mpg. not only will i get better mileage but my gas will cost almost half the price of the camry’s.
Wow, I’m glad to see so many of you are reading the headlines in newpapers and watching the news…yet fail to investigate actual automotive facts. The worst comment/s I have seen on here are the comparisons made between Chrysler’s 2.99 gas deal and sub-prime mortgages…really? These are on the same line? Chrysler is not giving away money, rather saving you money on a product (gasoline) you are going to purchase regardless of what vehicle you drive.
As far as dependibility, if you look at JD Powers ratings(which most manufactures value highly), the lowest overall dependibility ratings are for Kia, Land Rover, Mazda, Nissan, Saturn, Suzuki, and Volkswagen…how many of those are “American” automobiles? Hmmmmm…
I also love the comments about how the “refuel america” campaign is “destructive for our country” (thanks andrew s.) So I suppose what you’re implying is that the more cars GM, Chrysler, and Ford sell is destructive? How many people are employed by these companies and their dealers in this country? Yes, I see, destructive to sell cars. It is not the corporation’s fault people decide to spend over their limit…if a US company is not willing to feed the needs of its customer’s a foreign company will. Every American needs to take responsibility for their choices and not point the finger at someone else…if you max out your credit cards on material things IT IS YOUR FAULT you have no self control.
Suck my balls.
Steven - Mature ending to your comment. My credit cards aren’t maxed out, I have no debt, and plenty of self-control. I think its great if people want to buy American. I just get pissed off that people I-405 and 520 who drive single occupancy vehicles in bumper to bumper traffic, and I don’t like the idea of artificially driving down gas prices. Gas is not something we should subsidize. Maybe of this gas price hike was a short-term deal, fine. But gas is going to keep going up, and it feels like the idea behind this promotion is to keep people in denial about that.
I agree with you Andrew. In fact I would favor prices going even higher, but at a slower rate. They are high enough now for people to stop bitching and moaning and start changing their ways to accommodate the fact that the days of oil are numbered. The only thing that’s bad about what’s happening now is that the price has gone up so fast that there is little time for people to react. It takes time to decide to buy a more economical car, and how to buy local products that don’t depend on increasingly expensive transportation. And it takes time for Detroit to retool to make more efficient vehicles… But they should have seen this writing on the wall a decade ago like Toyota and Honda did.
This $2.99 gas subsidy is a step in the wrong direction. Go ahead and buy a van and take that vacation. Go ahead and take your boat to the lake on the back of your shiny new monster truck…. Get real, Detroit. I have seen more and more big trucks and vans on the side of the road with For Sale signs on them. I think the depreciation on those gas guzzlers is going to be a lot worse than it has been in the past, and this $2.99 deal is just a gimmick to try to get people to forget that little inevitability.
I don’t know why everyone is making such a big deal about this. What are you really getting??? Look at a ‘best’ case scenerio where you buy a vehicle which gets 20MPG. That’s 650 gallons of gas. Even if the price of gas raises $2 per gallon for the entire 3 years you are only saving $1300 dollars per year for a grand total of $3900. CHECK THE REBATES THAT FORD, CHEVY, AND TOYOTA ARE GIVING. You are paying more in finance charges because you don’t get the initial rebate, or cash back, to put towards a down payment. This isn’t a good deal. I just purchased a 2008 Ford Fusion. My savings in gas would have been $2400. I had $4000 worth of rebates plus was able to get a 1.9% APR.