South Carolina dealer John Isgett didn't want the hassles of the federal cash-for-clunkers program. But he didn't want to miss out on the buzz and the showroom traffic.
So he started a private version, called "cars for clunkers," and he's extending it through August because it has boosted his July and August sales by about 30 percent, or about four dozen new and used units. That's all without having to do battle with he government's recalcitrant computers or cripple the cars he takes in trade.
Isgett, who owns Raceway Automotive Group in Florence, S.C., says he gave people what they wanted by offering them $3,500 or $4,500 for trade-ins. But he only filed one or two deals with the government's cash-for-clunkers program.
Instead, he either kept the trade-ins to resell or sold them at auction. He also offered the incentives for used cars -- not just new ones, like the government program.
He's advertising the extension of his program to attract shoppers who weren't able to make last-minute deals before the federal program ended Monday night. For instance, some customers called him Sunday, when Raceway stores are closed, asking to meet him to make a deal.
Need not worry
"I said, 'Need not worry. We've extended the program.' They said, 'How did you do that?' I said, 'We have special processes,' " Isgett said.
Did he make it clear to shoppers that their $3,500 spiff was part of his private marketing effort and not the government's program?
"Everything in the advertising leads the customers to believe" they're participating in the government program, Isgett said, although he never used the governments program logo or official name -- CARS, for Car Allowance Rebate System.
"They're walking away feeling like they're getting a good deal. They didn't care whether the money came from the government or not, he said. I don't think we actually told them, 'We're not doing the government program.' They understand that under the government program they had forms to sign as well, and we didnt do those forms.
Also, many consumers bought used vehicles, understanding the government program only applied to new ones, he said.
A spokesman for the National Highway Traffic Safety Administration, which administers the federal program, said in an e-mail, "Cash for clunkers is not the official name of our rebate program." He declined to comment further.
While other dealers are complaining about slow post-cash-for-clunkers traffic, Isgett said his stores are still doing deals.
"I've had personally probably a dozen phone calls of people trying to participate last-minute," he said.
When an acquaintance asked him at a Rotary International club meeting whether his vehicle qualified for the program, Isgett said, I dont think it does, but you bring it to my dealership. Ill give you $3,500. He said, Oh, really?
But if a consumer had insisted on getting the rebate from the government, Isgett said he would have tried to make that sale.
If you come in and say, Nope, I want to be part of the CARS program, Id say, OK, heres the qualifications, he said.
Isgett said his Ford store and four used-vehicle locations didn't lose money on the promotion. Some of the vehicles that received $3,500 trade-in credits resold for $4,500 or $5,000, and some of the trade-ins were worth less than what consumers received for them.
"A lot of people don't know the value of their vehicle. So they come in and say, 'It's worth $3,500? Great!' " Isgett said. "They were more into, 'I'm getting something free from the government.' That's what drove the market."
Isgett said he was "kind of shocked" that other dealers chose to participate in the federal program rather than create their own program by reselling the vehicles they took in trade.
So why did he file any applications at all with the feds?
"If they have a turd of a vehicle, we're going to apply for the money."