Wednesday, July 1, 2009

Hyundai offers 1.49 gasoline-cap. Why?


On Tuesday, June 30, the Korean automaker is launching a summer promotion that guarantees buyers of its vehicles one year's worth of gas at $1.49 per gallon.


Apparently their analysts concluded that US economy will experience further declines in the coming year, where more destruction of dollar-backed credit instruments brings about a stronger USD, therefore lower commodity prices (e.g. oil, gold). This gas/petrol scheme could lead to huge losses if they are wrong, then they must know SOMETHING more immediate than the ARM resets.

It makes me a bit nervous as non-financial institutions usually belong to the "dumb money" population, and I find myself aligned with Hyandai's sentiment. Perhaps it calls for a review of the drawing board.

0 Reflections: