Gas Is Going To Take The Place Of Cash In New Round Of Incentives

Implications: As I suggested in an article last week, Detroit is looking at gas as an incentive in place of cash in order to get sales moving.

Analysis: Chrysler has announced that it will launch a new incentive program called "Lets Refuel America," that guarantees buyers of most of its vehicles can lock into $2.99 a gallon gasoline for the next three years.

It comes as no surprise that Chrysler is offering a gas related incentive: Chrysler's sales were the worst of any automaker in April. And even the current hefty cash incentives seem to be doing little to move the metal.

It'll be no surprise that, as politicians get into the act, other automakers surely will jump on this bandwagon.

This situation reminds me of the GM Employee Pricing program that spread like wildfire in the summer of 2005. It's likely other automakers will follow Chrysler's lead.

Gas prices are having a profound effect on the psychology of car-buyers, so it was to be expected that automaker and dealer tactics may include free gasoline programs.

It is the psyche of the potential car-buyer that Chrysler is aiming at with this incentive. Customer feedback shows that the price of gas and the volatility of fuel prices weigh heavily on the customers buying decision.

When a customer purchases almost any new Chrysler, Jeep or Dodge vehicle, they can select the "Let's Fuel America" program instead of other available incentives. On some vehicles, a combination of the gas program and cash incentives apply.