Auto dealers hoping for rush of bargain hunters

The 25 percent sales tax increase - to 6.25 percent - coupled with today’s release of the federal credit program’s final rules could provide a much needed boost for the sinking industry, some auto officials say. According to the Massachusetts State Automobile Dealers Association, there are 441 dealerships in the state, about 20 percent fewer than in 2007.

“When the government puts up billions of dollars to help stimulate the car industry, people are going to want to buy,’’ said Raymond Ciccolo, an official with the Massachusetts dealers group and the National Automobile Dealers Association.

But John Wolkonowicz, an auto analyst for IHS Global Insight in Lexington, does not believe the sales tax change and federal credit plan will be enough to overcome consumers’ concerns about the lingering recession.

“I don’t think it’s going to be that great,’’ Wolkonowicz said of the prospect of improved auto sales. “A lot of people are still gun shy about making major investments.’’

Besides, he said, the federal incentive, formally called the Car Allowance Rebate System, is flawed. The program - which will be available through Nov. 1 - offers cash vouchers of up to $4,500 to buyers who trade in fuel-inefficient vehicles that are in operating condition and less than 25 years old. The goal is to prompt the sale of vehicles with better mileage. But Wolkonowicz noted that not all clunkers qualify for a voucher.

“Passenger cars need to get 18 miles per gallon [combined city and highway mileage] or less,’’ he said. “The only passenger cars that fit that bill are the largest ones, like a Crown Vic, and luxury cars and sports cars. Most of the luxury and sports cars are worth more than $4,500, so why would you give the car away for $4,500 when you can get more for it privately?’’

But some local auto industry officials are trying to put the promotion in perspective. With Chrysler merging with Fiat to survive and General Motors Corp. emerging from bankruptcy propped up by $50 billion in taxpayer funds, no one is saying a short-term sales rally will cure the industry’s many ills.

Robert O’Koniewski, executive vice president of the Massachusetts State Automobile Dealers Association, said he only expects around 225,000 cars to be sold nationwide through the $1 billion cash for clunkers program, about a week’s worth of sales. He did not give an estimate for Massachusetts sales through the program.

“It’s not like the government is cutting everyone a $4,000 check,’’ O’Koniewski said.

Still, that hasn’t stopped some salespeople from hoping that the federal incentive, combined with the specter of a higher state sales tax, will send crowds rushing into too quiet showrooms.

Cityside Subaru in Belmont recently sent an e-mail to customers with a chart depicting the hundreds of dollars in savings they could pocket by purchasing a car before next month.

Rick White, the dealership’s general manager, said he has already seen an increase in the number of people coming into his showroom.

“Nobody has come out and said it’s because of the sales tax, but I think it is,’’ he said. “I think next week could be a huge week in the car business in Massachusetts. We’ve had, on average, about eight people a day in the past week buying cars, when typically it would be four or five.’’

Those interested in buying a Chrysler, Dodge, or Jeep may have an additional motivation for buying a car before November. Chrysler Group LLC is rolling out incentives that provide as much as $4,500 off the price of a car - in effect, matching the cash for clunkers credit. As an alternative, the automaker also said Wednesday, buyers can opt for zero percent financing for six years on most 2009 models.

Chrysler sales were down 46 percent for the first six months of the year, compared with a 35 percent drop for the industry as a whole.

“I’m seeing an increase of probably another 20 percent next month, another 10, 15 cars,’’ said Paul Connor, owner of Mansfield Jeep Chrysler. “To me, that’s huge. People’s margins have been so tight that you get 15 percent increases in your sales, you can really get yourself into a profitable situation.’’

Sean Sposito can be reached at ssposito@globe.com.