There has been a lot of talk lately about smaller, more efficient cars being the new face of America’s roads.  Yet despite the discussion, lower gas prices are causing used car buyers to revert to bigger vehicles.

Small used cars are taking a hit on value in the market, according to Kelley Blue Book.  Even the once hot-ticked Smart ForTwo is suffering, according to the auto pricing publication.

“Its part of a larger trend that’s been happening all year,” says Alec Gutierrez, a senior market analyst for KBB. “Some of the weakest segments are subcompact, compact and hybrids.”

This trend reflects a couple of important things to consider about the current market: first, it shows that gas prices have been remaining at what consumers view as a reasonable level for a prolonged period of time.  But more importantly, it shows that consumers are not thinking long-term when it comes to their vehicle purchases.  The federal government is mandating smaller, more efficient cars, but for now consumers are staying away from them due to higher costs.

Lower demand for SUVs during 2008’s price spike led to lower prices which are now very enticing to buyers. “We do see big stuff moving,” says Steve Bussjaeger, owner of the Star SuperCenter used car lot in Glendale, Calif. “They got cheap… People are more price conscious than gas (price) conscious.”

To those looking for a compact car, the near future will hold some deals, as demand for larger vehicles is having the inverse effect on small cars.  Value is down 15% since 2008 on small autos.

“The entire industry has suffered this year. … The small-car segment has been affected by this as well,” says Smart USA spokesman Ken Kettenbeil. “However, we know that in time both situations will change. For this, and many other reasons, the trend will transition toward smaller vehicles.”

Photo courtesy of wili hybrid under the Creative Commons License.

Enterprise Rent-a-Car saved millions of dollars by deleting side-curtain air bags from thousands of fleet vehicles, according to the Kansas City Star.

Enterprise purchased about 66,000 2006-08 model-year Chevrolet Impalas missing side-curtain airbags.  The lack of airbags saved Enterprise about $175 per vehicle, for a total savings of $11.5 million.

After the Impalas were removed from fleet service, the rental company and several dealers nationwide made the cars available for resale to consumers.  However, when the cars were advertised online, they were listed as having the missing safety feature.  745 buyers took the company up on their offer, unaware that the cars were missing side-curtain airbags.

Enterprise maintains that no federal mandates prevented them from omitting side-curtain airbags from the vehicles and stand behind their decision to do so.  The St. Louis- based company did admit, however, that they made a mistake in online advertising.  Enterprise VP for Corporate Communications Christy Conrad stated that there was a “glitch” in Enterprises’s system that listed the cars (only online) of having side-curtain airbags.

Enterprise plans to rectify the issue by sending letters to every person who bought one of the vehicles explaining the problem.  The company will also offer to buy back the cars at $750 above Kelley Blue Book

value.

Roughly 3,000 Impalas have been sold to consumers on Enterprise-owned lots, both properly and improperly advertised.

GM says it has since discontinued the option of removing side-curtain airbags for the 2009 model year.

Remember: always make sure you know what your fleet is getting when you buy and sell vehicles. Thorough inspections and communications with sellers are essential to ensure the health of new fleet vehicles.

As fleet vehicles become older and need to be replaced, business owners must decide what to do with the older vehicles.  Generally, the vehicles in question are simply sold at auction or relinquished to a leasing company.  But recently, fleet owners have ramped up programs that offer the out-of service vehicles to be sold to drivers at low cost, which saves companies money in selling costs and offers a valuable benefit to employees.

For many employees, the prospect of owning a familiar vehicle for a low price is very enticing.  Employee vehicle sales have been met with great success at companies such as Mission Foodservice, where fleet facilities manager Chris Syed confirmed that at least 45 percent of the company’s out-of-service vehicles are resold to its employees.  The program has been consistently successful; Syed reported that “The percentage has remained steady over the past several years.” Mission Foodservice operates a 300-vehicle fleet, leased from LeasePlan USA. With fleet vehicles being replaced every four years or so at Mission Foodservice, there is a steady flow of vehicles in need of new owners.  The vehicle’s regular driver is given the first rights to purchase the vehicle, and the sale is opened to the rest of the company if the driver declines.  The vehicles undergo safety inspections on-site and will not be sold to employees if they have any safety issues.  The best part of the deal for employees is the selling price; drivers pay wholesale price for the vehicle while other employees pay, according to Syed, “somewhere between wholesale and the Kelley Blue Book private party price.”

The program became so popular that Syed could no longer handle all of the work on her own.  In October of 2006, five years after the program was introduced, Mission Foodservice hired Flexco Fleet Services to handle the overwhelming demand for the program.  Since the move to Flexco, the employee resale program has been just as popular as ever.  Syed remains confident in the need for employee resale.  “Employees love this program. They view it as a bonus.”

Photo courtesy of Caitlinator under the Creative Commons License

If you’re looking for ways to save at the pump this summer, and you already have a fleet card, this promotion may interest you.

Suzuki just announced its ‘Free Gas for Summer’ sales event that offers car buyers three months of free gasoline with the purchase a new 2009 Suzuki SX4 Sedan or 2009 SX4 Crossover. Plus, to get you in one today, they’ll throw in $2,000 in customer cash on all 2009 SX4 models with manual transmission.

“Suzuki recognizes the economic challenges facing Americans and thought this promotion was a great way to provide relief for car buyers,” said Koichi Suzuki, executive vice president, American Suzuki Automotive Operations.

It should be noted, Suzuki’s four-door SX4 Sedan was recently named as one of the “Top 10 Coolest Cars Under $18,000″ by Kelley Blue Book.

The Suzuki “Free Gas for Summer” sales program kicked off July 1 and runs through Aug. 31.

If you drive one off the lot let us know how it goes.