Posted by: David Kiley on May 5, 2009
All the bankruptcy talk about Chrysler and the actual filing last Friday has been good for business, according to auto shopping website Edmunds.com
Since the automaker’s Chapter 11 filing April 1, visitors on Edmunds.com shopping for Chrysler models shot up 15 percent. By comparison, GM’s shopping consideration dropped 6 percent since Thursday and Ford’s was up 7 percent.
“I’d call this ‘the Obama bounce,’” remarked Edmunds.com CEO Jeremy Anwyl, referring to the President’s recent speech that discussed Chrysler’s situation and urged consumers to consider buying an American car.
Earl Hesterberg, CEO of Group One Automotive, a company that owns numerous dealerships including Chrysler and GM brands, said it was a relief, with Chrysler, to have a “clear direction on what is going to happen.”
“Maybe the Chrysler bankruptcy announcement attracted the bargain shoppers, who may think a bankruptcy is the same as liquidation with price-busting clearance sales,” reported Edmunds’ AutoObserver Editor Michelle Krebs.
Last Friday, Chrysler officials, reporting a 39% decline in April sales, said they heard from dealers anecdotally that day that there was a spike in showroom traffic with many customers expressing the thought, “I want to be a part of this.”
Dealers also say, though, that customers are coming into the showroom making outrageously low offers for Chrysler vehicles, expecting them to take any price just to sell a car. Edmunds.com’s most recent data indicates that Chryslers sell for an average of 18.1 percent below sticker while the industry average discount is 15.6 percent.
Krebs suggests, “Perhaps Chrysler loyalists, though dwindling in ranks, are coming to the aid of their brand — or seeing this as the last hurrah to buy their favorite brand.”