Fiat Chrysler, GM are trying 7-year 0% loans, online buying to lift plunging sales
With auto showrooms shut during the coronavirus pandemic, Fiat Chrysler and General Motors moved to reboot demand with seven-year, no-interest loans and programs allowing customers to buy vehicles online.
Fiat Chrysler Automobiles' new "Drive Forward" marketing program includes online shopping tools that will for the first time allow U.S. customers to complete the purchase of a vehicle through an FCA dealer without setting foot in a dealership, a company spokesman said.
The move toward online sales and home delivery breaks with a long U.S. auto sector tradition of manufacturers giving franchised dealers control of sales to consumers. Dealers have fought Tesla 's efforts to sell vehicles directly to consumers through its website.
GM and Fiat Chrysler's promotions of extended, no-interest loans — made less costly by the Federal Reserve's recent interest rate cuts — echo the "Keep America Rolling" sales push GM launched to jump start a paralyzed consumer market after the Sept. 11, 2001, attacks.
But the pandemic has been pulling auto retailing into the digital age, with dealerships shuttered across the country and sales likely to take a further beating in April as social distancing guidelines remain in place.
FCA shares were down 4.9% to $6.84 in afternoon trading in New York after the company posted a 10% drop in first-quarter U.S. auto sales, as the pandemic hurt demand and halted production from mid-March. The company, however, did not break out sales by month.
General Motors reported its first-quarter sales fell 7% because of significant declines in March, and said customers can use its existing "Shop.Click.Drive." program to find, purchase and arrange for home delivery of a vehicle.
A GM spokeswoman said across the Chevrolet, Buick, GMC and Cadillac brands the automaker has seen two to four times greater online site visits and sales leads than before the pandemic.
Hyundai said earlier that its U.S. sales fell 43% in March due to the pandemic.
"It goes without saying that the entire world is facing a tremendous challenge that is having a significant impact on business and our normal way of life," Randy Parker, vice president for sales at Hyundai Motor America, said in a statement.
Toyota said its sales were down nearly 37% in March and 8.8% for the quarter. Nissan reported a 27% drop in first-quarter sales.
FCA said its "Drive Forward program" allows customers to complete the entire vehicle purchase process online.
The system allows consumers to buy vehicles off dealer lots, trade in their old vehicle and apply for a car loan, FCA said.
The company also said that as of April 1 customers can take advantage of 0% interest loans for 84 months and make no payments for 90 days on select 2019 and 2020 model vehicles.
Fiat said momentum in the first two months of the year was offset as the virus hit the economy in March. Its Ram pickup trucks were a bright spot as their sales rose 7% versus the first quarter of 2019.
