By on October 15, 2013

assurance

The head of Hyundai Motor Company’s U.S. sales unit, John Krafcik told the Bloomberg news agency that the continued partial shutdown of the United States government is affecting consumer confidence and may result in as much as a 10% drop in October sales. Krafcik said that the political impasse in Washington is creating “anxiety” for many people.

“It’s that anxiety that keeps customers, potential buyers, on the sidelines when making a big purchase like an automobile,” he said. “We’ll probably see the industry off five to 10 percent this month, compared to where it was in September. I think a lot of it has to do with this shutdown discussion… Industrywide, we’re definitely seeing a slowdown in October,” Krafcik said.

The final quarter of the year is usually a strong sales period as automakers discount the outgoing model year cars and early adopters embrace the newer models. Septmember sales, though, were down 4.2% overall, the first year to year drop in over two years. Some of the decline, though, is attributed to a quirk in the calender that put Labor Day sales under August’s ledger.

Krafcick echoed earlier comments from General Motors and Ford that an extended government shutdown could hamper the already less than booming economic recovery.

At the start of the month, Hyundai initiated a program that allows federal workers affected by the shutdown to defer payments on car loans and leases. “We have already had requests from over a thousand people to have their payments deferred,” Krafcik told Bloomberg Television. “That’s a much stronger uptake than we thought. It makes us happy. It means we’re making a difference, but it does give an indication of just how deep and serious the issues are.”

Late yesterday, Toyota Financial Services said that it would allow federal employees “relief” on car payments for up to three months. “The government shutdown has placed an unanticipated financial strain on many individuals and families,” Al Smith, group vice president of Toyota Financial Services, said in a statement. Hyundai has previously offered buyers a job-loss guarantee program, dubbed Assurance, that allowed them to bring back their cars if they were laid off.

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37 Comments on “Government Shutdown Affecting Car Sales, Hyundai’s Krafcik Says. Hyundai & Toyota Offer Relief to Furloughed Federal Workers...”


  • avatar
    JD321

    The tax-taker parasites should be using their PAID time off to go car browsing! Ingrates.

    • 0 avatar
      MattPete

      Why do you hate America?

    • 0 avatar
      28-Cars-Later

      Which is worse, the excess federal workers or the welfare class?

      • 0 avatar
        racer-esq.

        From a purely economic perspective it makes more sense to put someone on welfare than to create a fake job. The fake jobs almost always pay significantly more than welfare, on top of the office space and other resources that get sucked into providing fake jobs.

        However, the Department of Defense, including even most civilian positions, is being excluded from the government shut down, so the major source of fake federal jobs remains untouched.

        It is easy to freak the masses out about security (unlike, for example, an uneducated, unhealthy population with poor infrastructure), so military and police fake jobs are by far the easiest to create. And unfortunately many of the people with those fake jobs don’t realize it, and instead act like some hard *ss berating the taxpayers that fund their fake jobs. They are also the most expensive to create, I’ve seen that it costs $850,000 per year to create an overseeas troop job.

        • 0 avatar
          28-Cars-Later

          You may find this apt, I used to work in healthcare and in ’09 I visited a VA facility on business. What surprised me the most was the fact evidently the VA has its own private police force. Not even a few armed guards (as I might expect) but an entire force of uniformed officers complete with matching patrol cars. Seems a bit excessive to me.

          • 0 avatar
            dolorean

            Why would you find this excessive? The VA is a Federal Agency, on Federal land, subject to Federal laws, much like an Army Fort or Naval Base. Therfore the State and Local police do not hold jurisdiction without due cause and expressed consent of the Commanding Director/General/Admiral. Local laws, such as Dry Counties, do not apply on the Federal Land. Therefore you need a Federal Constabulary system to enforce and prosecute federal law.

          • 0 avatar
            28-Cars-Later

            I’ve never served so I don’t quite grasp the exact legal reasoning you’re expressing. I could see an active military facility having its own law enforcement and due process, but giving it to every hospital seems excessive to me (I think there are something like 100 VA hospitals). You could accomplish the same result with a few armed guards or members of the military police to secure the facilities. Do most VA hospitals really require more protection than any other hospital facility in the US?

          • 0 avatar
            Signal11

            It doesn’t matter if you’ve served or not.

            The legal reasoning is simple and is sound in precedence.

            State and local (city/county) authorities do not have jurisdiction on Federal property, period. They do not have the legal power to enforce laws on anything that is not within their state, county or city limits, just like how a NYPD cop can’t enforce NYC law in New Jersey. Federal property is not any of those, thus requires its own police.

            Armed guards are not law enforcement officers. They do not have the authority to engage in public safety or law enforcement functions. They do not really have the legal authority to arrest, detain, investigate or otherwise carry out the basic functions of a regular police force.

            Military police are also not civilian police officers. Military police enforce the UCMJ (aka military law), not civilian law, which is pretty much exclusive to active military personnel and/or military facilities. This is why large federal agencies require their own police forces.

            VA facilities are civilian facilities that are often massive in size and population, rivaling the size of small towns. It only makes sense for them to have a police force.

    • 0 avatar
      morbo

      Typical. Teabagger complains about the big bad gubmint. Conveniently ignores those federally sourced or partially funded roads, bridges, ambulances, police, and maintenance crews. Probably complains about toll roads in states like NJ/PA/NY, even though the Ayn Randian delusion of pay your own way is best expressed (automotatively) by toll roads.

      • 0 avatar
        50merc

        Just a word of explanation, Morbo, about that word “teabagger” you used. It’s a vulgarity referring to a certain sexual practice (and I’m not talking missionary position) so it is not acceptable in polite company, even if it did have anything to do with the Tea Party movement. The word got popularized by certain left-wing celebrities when they were trying to turn the Tea Party into a scarecrow.

        By the way, the Tea Party movement (it’s not an organization or party) is actually about keeping government within constitutional boundaries, not abolishing it.

        • 0 avatar
          morbo

          I use the term teabagger intentionally and with all associated meanings inherent to it. The teabagger movement is about 20% honest people using a misguided understanding of sovereign spending to reduce the federal debt, 20% Ayn Randian absolutists whom disregard all context or potential for compromise, and 60% hillbilly redneck racists that believe the apocalypse has befallen good, christian, white, Amerika.

          I base my statistics on counting the quantity and content of the signs I see when googling Tea Party; the various religious, nationalistic, animalistic and racial assertions I see referencing our president makes me question the sincerity of this movement’s commitment to ‘keeping government within constitutional boundaries’. Especially since they’ve had 4 years to get their racists in check and have pointedly chosen to not even reject but outright embrace them in their rallies.

  • avatar
    cdnsfan27

    My wife is a DoD civilian employee working 50 hours a week through the shutdown…for defered pay. She is excess? What do you contribute?

    • 0 avatar
      28-Cars-Later

      Whoa hang on there friend, I can’t speak for JD but I don’t feel every gov’t employee is a “tax taker” hence excess. But the fact is there are depts and jobs which don’t need to exist and contribute to the overall deficit we find ourselves in. The question i posed it which is worse, the excess employees/dept and thus spending or spending good money after bad on a welfare class. For my own response I’m resigned to the fact there will always be a welfare class the only questions which remain how much of a percentage of society falls inside of it and how much is spent on it. I see increased spending on excess workforce much more economically damaging for the country and the currency.

    • 0 avatar
      highdesertcat

      Federal employees of all persuasions will get reimbursed at the full rate once this politically induced impasse is over. They were reimbursed in the past government shutdowns, they will be reimbursed again.

      For those who are not currently performing their duties at work, they will be charged with PAID LEAVE once they return to work. There’s nothing to worry about. This was beyond their control.

      I’ve got two sons and one grandson working for the Feds, one as a SA Border Patrol and the other two as Marine Corps GS-12 Civilian Range Safety Controllers, and all three were deemed mission essential. They HAD to work or be deemed absent without approved leave.

  • avatar
    cdnsfan27

    Sorry, I am a little touchy on that subject, my wife works hard to make sure another 9/11 doesn’t happen, and she is doing it now without pay, just pisses me off brother.

    • 0 avatar
      28-Cars-Later

      Its easy for the country to forget the people who really matter. I wish you and her luck that this political tug of war gets resolved or at the very least they start paying people again.

    • 0 avatar
      racer-esq.

      Enough with the 9/11 fearmongering. That’s what lead to brilliant decisions like destablizing Iraq.

      Since you raised the subject, national security positions are recieving very broad exemptions from the shut down, so I have to wonder where non-exempt national security positions fall in the grand scheme of things.

      “Some departments were barely hit by furloughs — about 97% of Department of Veterans Affairs employees were exempt. Defense Department numbers were not available, but 84% of Homeland Security employees were exempt, as were 80% at the Justice Department.”

      http://www.usatoday.com/story/news/nation/2013/10/09/shutdown-furloughs-return-to-work/2953191/

      • 0 avatar
        aristurtle

        Those (civilian) jobs exempt from furloughs are still on deferred pay until the whole mess is resolved.

        Hyundai made a pretty good play here. If the market is slowing from uncertainty, address the causes of the uncertainty head-on. They come off looking like philanthropists, even though it’s of course just a simple business decision combined with a fairly obvious PR move. (Oops, sorry for venturing on-topic.)

      • 0 avatar
        28-Cars-Later

        Curious, exemptions in a “shutdown”.

        • 0 avatar
          dolorean

          ‘Exempt’ and ‘Non-Exempt’ are what we’ve called cut workers since the Repubs closed the gubmint in ’95-’96. Before that time, they were considered Essential and Non-Essential, which is no longer used. Yet the media of all stripes cannot seem to understand this.

          • 0 avatar
            aristurtle

            It gets confusing because in the employment context “exempt” and “non-exempt” usually means “salaried employee who doesn’t get paid extra for overtime” vs. “hourly employee who does get paid extra for overtime”, which is why the media prefers the essential/nonessential thing.

          • 0 avatar
            28-Cars-Later

            Thx for the info.

      • 0 avatar
        cdnsfan27

        Being exempt doesn’t mean they are being paid at this time, but the bills are still coming in. And I am sure you would be the first to crow about another intelligence failure if my wife and her dedicated colleagues were not on watch and something happened.

        • 0 avatar
          threeer

          Oh…and in regards to “9/11″ fear-mongering…while there are, at times, excessive comments on the dangers of another attack used to justify large expenses, even if America pulled out of every country we base troops in (some are most assuredly due for our departure) 100%, there are still plenty of people (and countries) that would just as soon see us wiped off the face of the Earth. It isn’t hyperbole, but fact. Maybe exaggerated at times, but to make a blanket statement that it’s ALL excessive and useless is denying the fact that some level of defense spending is still required.

  • avatar
    cgjeep

    JD, I work on cancer research for Fed Gov. What meaningful contribution do you make for society? Also during a Gov shutdown not able to use leave but hey don’t let facts get in the way. Lucky for you there are other Gov workers protecting your right to be ignorant in speech.

  • avatar
    mikey

    Gee, and here I thought it was just the UAW guys that everybody hated.

  • avatar
    mikey

    Unlike some of the other non American posters here, I don’t believe its my place to comment on American politics.

    Just a couple of questions. Will those that are furloughed eventually get paid? Is Toyota, and Hyundai deferring the payments,or just waiving them.

    • 0 avatar
      aristurtle

      Workers deemed “essential” are working on deferred pay but are guaranteed to be reimbursed once the shutdown ends.

      Workers furloughed might get paid after the shutdown ends, if Congress approves it. That’s what happened last time. It’s probably what will happen this time, I guess, but I’ve stopped taking things for granted from this Congress.

      Note that that applies to civilians directly employed by the Federal government. Active-duty military are getting paid on schedule. Employees of contractors are subject to the whims of the contracting company.

      Hyundai (and I guess now Toyota) are allowing customers to defer the payments, they are not waiving them. But everyone should be getting paid that money later, just not according to the expected schedule. Hopefully. So everything should turn out fine in the end, probably.

      • 0 avatar
        dolorean

        Its been approved; however, some see it this way:

        Person in crowd “The people that had to work should be paid. But the people that are home watching Netflix and whatever, I’m not sure that we should be sending them checks.”

        Florida Representative, “Well, when we voted on that they were supposed to come back to work as part of that deal. … I agree 100 percent with you. If they’re not working, they shouldn’t get paid.”

        Like furloughed workers choose to be home not working, wondering how they are going to pay their mortgage. My furloughed workers are not happy they are not working. They are most certainly not on vacation; most are turtling at home waiting and watching the news hoping that tomorrow they can get back to their careers.

    • 0 avatar
      el scotto

      Mikey, it could always be worse. A friend of mine is getting married next month. She’s a govt contractor, he’s a government employee. They’re both waiting out the shutdown.

  • avatar
    threeer

    As one of those dadgum “excessive” gumint workers that are quite obviously leeches on American society, I’ll try to leave the politics of all of this alone. But I will say this…try explaining to a foreign government (and their Air Force) why you can’t provide the equipment they have paid handsomely for because your OWN government can’t get their collective heads out of their behinds. For the sake of foreign relations alone, I would have MUCH preferred to be back at work at my grossly over-paid and excessive job. I’ll freely admit that there is excess, and there is movement withing the DoD to shed some of that excess through early outs and yes, even talk of RIFs next year within higher commands.
    As for the Hyundai and Toyota offering what they are, I guess any advertising is good advertising. I’m certainly not rushing out to buy a new car simply because of this (especially in light of the fact that I am fully expecting more intermittant shutdowns in the future. Kind of stupid of me to go get a loan when I may take another pay cut. Sure, a deferment in pay means I “eventually” get my salary, but that does little good when you’re facing the bills now), but it’s good press to offer relief to those that did get affected by furlough…not that the millions completely out of work due to a tanked economy aren’t as deserving as furloughed government workers.

  • avatar
    mkirk

    When I was downrange and had pay issues (due to a civillan pay clerk not following regulation) I got no such deal. Of course I have this novel thing called a savings account which got me through until it was straight.


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