The Memorial Day weekend is usually is one of the best times for auto sales. This year, it's taking special prominence as dealers try to make up for slumping business.
Sales of new cars and trucks throughout the metro area fell about 13 percent in the first four months this year compared to the same time last year, according to Tucson New Car Dealers Association statistics provided by Jim Click Automotive Team Vice President Sam Khayat.
Last year's sales were also down about 8 percent from 2006, Khayat said.
The obvious culprit is rising gas prices. With gas over $3.50 a gallon at many stations across Tucson — and skyrocketing oil prices threatening to drive gas prices up further — some dealerships are featuring gas giveaways among other incentives.
This year, consumers are being more careful with their dollars and making fuel economy a priority, said Steve Lace, general manager of Royal Automotive Group, 4333 E. Speedway.
People are also reading…
"That seems to be the thing they're most concerned about," he said.
Dealers say big trucks and SUVs are down but sales of smaller cars and hybrids are up.
"Our hybrid sales are up 150 percent and just going off the chart," said Brent Berge, of The Berge Group, which owns Tucson's Desert Toyota, 7150 E. 22nd St..
Click's Ford and Dodge dealerships are down so far this year, but his Hyundai, Mazda and Nissan dealerships are up, Khayat said. Khayat noted Click's sales overall were down only about 6 percent so far this year compared with 13 percent throughout Tucson.
"We're not displeased with any of our sales numbers," Jim Click said. "We are working really hard."
But while higher gas prices aren't helping matters, a broader slowdown in the economy is likely also hurting business, said Dave Aufmuth, owner of Aufmuth Motors, near West Prince and North Freeway roads.
Aufmuth, who sells late-model used cars, said his customers are more worried about price than gas mileage. More expensive foreign cars — even those with high fuel efficiency — are tending to sit longer on his lot.
"It doesn't matter what the gas costs if you can't pay for the car," Aufmuth said. He added that his sales are off by about 30 percent from last year.
To combat the sales slump, auto manufacturers and dealerships are offering a slew of incentives, especially some heavily promoted gas deals.
Chrysler, maker of Jeep and Dodge vehicles, is offering a $2.99 "gas guarantee" promising buyers three years of gas priced at $2.99 per gallon up to 12,000 miles each year using a special gas card. Suzuki is offering "free gas for the summer," in the form of a prepaid card up to around $450, depending on the car, said Edmund Marquez, owner of Edmund Marquez Suzuki, 702 W. Irvington Road.
Some dealers are providing their own gas giveaways on top of the manufacturer's incentives. Marquez is extending the manufacturer's gas offer until 2009 with gas cards up to around $750. Click is offering to pay for gas until 2010 for select cars, Khayat said.
Some dealers say the gas incentives are starting to generate sales, but perhaps not enough to turn the market around.
"We're not seeing a great return yet, but we're getting some inquiries," said George Salameh, general manager of Tucson Chrysler Jeep, 7800 E. 22nd St.