n Automakers to cover car payments if buyer loses job.
Staff and wire reports
DETROIT – It’s not an April Fool’s joke – lose your job, and keep your car or truck.
At least for a little while.
Ford Motor Co. and General Motors Corp. announced Tuesday that they are offering payment protection plans to help reassure consumers who may be putting off buying a new car because of worries about losing their job.
The offers come as auto sales have been battered by the recession and tight credit, reaching their lowest levels in 27 years.
Ford said it will cover payments of up to $700 each month for up to a year on any new Ford, Lincoln or Mercury vehicle if consumers lose their jobs. The program runs until June 1.
Hours later, GM said it would make a similar offer. GM’s new CEO, Fritz Henderson, said the company will make up to nine car payments of $500 each for customers who have lost their jobs through no fault of their own.
Helps the industry
“It’s a good idea, based on what I’ve heard so far,” said Corey Clark, general manager of Clark Ford in Amory. “Anything like this helps the auto industry.”
Customers must qualify for state unemployment to be eligible for the program. The program starts April 1 and runs until April 30.
Gary Cartwright, owner of Cartwright Ford in Booneville, said the Ford plan is a great selling tool.
“Along with 0 percent financing that’s available and rebates, now’s probably the best time to ever buy a car or truck,” he said. “I think a lot of people have been holding back on buying a vehicle because they were worried about their jobs, but this program I think now will give customers confidence to buy.”
Hyundai Motor Co. launched a program in January that allows buyers to return a vehicle within a year if they can’t make the payments due to a job loss or disability. The company said the program helped it avoid a double-digit sales decline last month, reporting a 2 percent slide.
Dearborn, Mich.-based Ford is also offering zero percent financing on certain Ford, Lincoln and Mercury vehicles.
“Consumers remain anxious about the economy and their own outlook for the future,” Ken Czubay, vice president of sales and marketing, said in a statement.
The announcements come a day after President Barack Obama said the government will back new car warranties issued by GM and Chrysler LLC, who have accepted federal assistance and are seeking more, to help boost consumer confidence about buying their vehicles.
Ford has not requested federal bailout funds.
Ford also said it would partner with its dealers to introduce a program that would help local charities affected by the economic downturn.