Sandy drives car rental prices up, new car prices down

November 15, 2012 2:58:36 PM PST
Many people lost everything in Hurricane Sandy, including their cars, and that has caused a huge demand at car rental companies and dealerships.

It was not just homes and businesses that were affected by Hurricane Sandy. The impact's also being felt throughout the car business, even at some dealerships.

Industry estimates at this point say at least 30,000 cars were damaged during Hurricane Sandy. And while repairs to homes and businesses could take months, most people are looking to get a set of wheels back much more quickly.

That means there is a lot of demand for rental cars.

"A lot of people's comprehensive coverage will cover them replacing their car or getting repairs as needed, but in the meantime, they need transportation. So that is adding to the demand that is already there for the Thanksgiving travel," said Jenny Robinson from AAA Mid-Atlantic.

An informal survey by the travel agents at AAA shows rental cars are available for our area, but money-saving deals are hard-to-find.

"Daily rate might be about $100 instead of $30, and for a whole week it might be $300 to $350 a week instead of what we usually see, which is around $200," she said.

And it is not just rental cars that are in high-demand. Sandy victims whose insurance companies are paying them the replacement value on their lost vehicles are pushing up the prices on used cars as well.

"We're looking at about 2% on the price of a used car. So for the average 3-year-old car, you might be looking at $700 or $1,000 more than what you would have spent before the storm," said Jeannine Fallon from Edmunds.com.

In some cases, it might be more cost-effective to buy a new car than a used one as interest rates on new car loans tend to be lower, dealers are trying to clear out 2012 models, and many car companies are offering special incentives for Hurricane Victims.

Those incentives can add up to hundreds, or even a thousand dollars off sticker prices.

Chrysler: Chrysler Group announced a $500 cash-allowance coupon to be applied toward the retail purchase or lease of most 2012- or

2013-model-year Chrysler, Jeep, Dodge, Ram and Fiat models. The program runs through January 2. Residents of FEMA-designated counties will be required to provide proof of an insurance claim indicating damage from the recent severe weather.

Ford: The automaker is offering eligible disaster victims a $500 bonus-cash savings toward the purchase or lease of a 2012 or 2013-model-year Ford or Lincoln vehicle. The incentive is available until January on both retail and leases.

Mazda: Shoppers in high-impact areas who have an insurance claim of damage or loss to their current vehicle can get $500 toward the purchase of a new Mazda. In addition, qualified customers have the option to defer their first payment for 90 days from the contract date on any new Mazda financed through the automaker's participating lenders.

Nissan: The automaker is offering employee pricing and discounted financing on Nissan and Infiniti vehicles to eligible buyers in FEMA-designated areas. The offer is extended through January 2.

Volvo: Volvo is offering eligible customers employee pricing on a new vehicle, plus an additional $1,000 to help offset costs. Anyone who lives in a FEMA-designated area can claim the offer through January 2. General Motors: said people whose vehicles were damaged as a result of Hurricane Sandy can also get an additional $500 discount on vehicles purchased or leased through the end of the year.

Dozens of manufactured are also offering car-payment relief and some type of leeway with regard to car payments (including Ford, Honda, Mazda, Nissan, Infiniti, Toyota, Lexus). Each has different parameters, so consumers are encouraged to check with their individual dealerships.


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