FAQ Friday: Should I Take the Manufacturer Rebate or the Gas Price Guarantee?
Summer usually mean more money spent on gas. So vehicle manufacturers, already offering record-level incentives, are adding "price protection" for fuel costs as a way to get you to buy a car this summer.
For example, Hyundai recently offered a Gas Lock program, part of the Hyundai Assurance program, in which new-car buyers will get 12,000 miles of gas at $1.49/gallon, slightly higher for midgrade and premium. Suzuki also announced Free Gas for Summer for purchasers of the Suzuki SX4, with gas cards worth $270 or $290, depending on the model you choose.
Some of these programs are worth it; other times they come with strings attached that make it difficult to determine their value.
Suzuki's offer is a no-brainer, because it's a freebie that can be combined with its other incentives (which go up to $2,000). Hyundai, though, asks you to choose between getting their standard rebate rebate ($1,000 - $3,000, depending on model) or reducing your rebate by $1,000 in order to get a guaranteed gas price.
So if you chose the Azera, which qualifies for a $1,000 rebate, your rebate would be reduced to zero in order get the gas lock. If you chose a Sonata and wanted the gas lock, your standard $3,000 rebate would be reduced to $2,000.
So is the gas lock a better deal than the $1,000?
In short, it's highly unlikely. One of our crack data analysts crunched the numbers, and found that if you take the gas lock, you stand to lose money -- even if you use every last mile of the 12,000 miles allotted. Below is the amount you would lose, per vehicle, if you took the gas lock instead of the money.
Incentive Loss for Consumer
(Based on current national average gas price of $2.61/gallon)
2009 Accent* -- $534 *base model excluded
2009 Azera (3.3L) -- $360
2009 Azera (3.8L) -- $327
2009 Elantra -- $518
2009 Elantra Touring -- $478
2009 Santa Fe (AWD) -- $288
2009 Santa Fe (FWD) -- $327
2009 Sonata (4cyl) -- $461
2009 Sonata (6cyl) -- $389
2009 Tucson (4cyl) -- $389
2009 Tucson (6cyl) -- $327
2009 Veracruz -- $248
What about in California, you say, where gas prices are averaging $2.95/gallon? Those calculations indicate less of a loss, but a loss nevertheless. Unless prices go up to well over $3.25/gallon, you shouldn't expect to be ahead by getting the gas lock. And according to Oil Price Information Service, average national prices are unlikely to break $3 this year.
In fact, average national gas prices are down $1.50 compared to a year ago, when Hyundai's program would have made more sense.
In the meantime, we vote, as we usually do, for cash.
- Posted by
- Joanne Helperin July 10, 2009, 11:00 AM
- Permalink
- Categories:
- Car Buying, FAQ Friday, Hyundai, Suzuki, Vehicle Incentives and Rebates
- Technorati Tags:
- Azera, Free Gas for Summer, Gas Card, Gas Lock, Hyundai Assurance, Sonata, Suzuki
Joanne,
this is off topic, but how is your Nissan Altima Hybrid doing?
Thank for asking, Carfreak8394. I consistently get 29mpg. Way below EPA estimates. Unlike what you'd expect (and what the EPA says), I am able to get MUCH better mileage on the open highway than the city. Because almost all of my driving is city driving (even the freeways in Los Angeles should be considered city driving because of all the stop-and-go), I can't seem to get it any higher without constant attention to my right foot. I really like the fact that it DOES have some power, and I can merge at will -- which wouldn't be true of the slower hybrids like the Prius. Overall, I love the car, and the mileage is still good overall, but the fact that I'm paying a premium for the hybrid but don't get the estimated mileage is kind of a bummer.