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Could Cash for Clunkers Rebate Offer Drive HVAC Business?

August 17, 2009
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Barb Checket-Hanks

Most of us are familiar with the recent Cash for Clunkers auto rebate program, which offered a substantial cash rebate when consumers replaced their older, inefficient gas guzzlers with newer, more efficient ones. The program has been such a success, automakers had to quickly shore up their supplies, and the program itself quickly ran out of money and had to be refunded.

There are many similarities drawn between cars and HVAC systems, especially where issues of maintenance, reliability, and efficiency are concerned. Could our industry benefit from a similar “clunkers” program?

I think it’s almost a given that instituting this type of rebate would help drive sales. The reception the automotive program got would seem to indicate it. It also seems probable that an HVAC clunkers program could have more benefits regarding pollution and global warming, if large enough numbers of consumers took advantage of it.

PAYING FOR IT

The Cash for Clunkers automotive program is, of course, government funded and its $3 billion extension is set to expire this Labor Day. For better or worse, it’s not likely that the HVAC industry would be able to get this kind of government stimulus. Who, then, would pay for an HVAC Clunkers program?

And what would happen to our clunkers? Could their metal be recycled by manufacturers to offset some of the rebate expense? I don’t know.

Perhaps it could be a sliding scale, where the older the equipment being replaced is, the higher the rebate would be. Perhaps qualifying for the rebate would entail that the equipment be installed according to industry standards, such as the Air Conditioning Contractors of America’s (ACCA’s) QI standard. That would help ensure that the newer, higher-efficiency equipment would not become an in-warranty callback nightmare.

FUTURE REWARDS

In addition to driving sales in a slow economy, I could see such a program creating a lot of consumer goodwill for the brand if it’s done correctly - that is, if the new systems are installed professionally, in accordance with today’s industry standards. The manufacturer that gets its name on that, in addition to providing increased comfort and savings, could wind up in a very enviable position.

Make sure the charge and the airflow are correct, examine the ductwork, and be professional - that’s all it takes. Isn’t that always what it took?

This type of program could also affect future sales by creating increased opportunities for contractors to get face time with consumers, and then giving them ample opportunities to be comfort and energy consultants in the truest sense. Requiring adherence to industry standards would help keep out the scam artists who seem to want to latch onto any good idea.

Perhaps this type of program would just be a new name for your existing marketing incentives. Perhaps it’s just a reallocation of existing marketing funds. I think it could reap rewards for this industry, the same way the automotive program is reaping rewards for manufacturers like Ford. Perhaps it could boost sales in our slow seasons.

The idea is now officially on the table, at least in my house. Maybe it’s already been discussed in your neighborhood. I’d be interested in hearing your thoughts on it.

Publication date: 08/17/2009
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