Big 3 turn to rebates again to jolt sales lag

[Guest Josh]

Detroit's carmakers are raising discounts again to steer consumers back to showrooms after paring incentives in October and watching sales tumble. General Motors Corp. and Ford Motor Co. added rebates of $500 to $1,000 on select 2005 and 2006 models. DaimlerChrysler AG's Chrysler Group added $1,000 cash rebates on most Chrysler, Dodge and Jeep products earlier this week. The latest moves reflect a softening market after a blockbuster summer, as well as consumer concerns over higher gas prices and rising energy costs. "Don't count on much of a rebound for November or December," Merrill Lynch analyst John Casesa said in a report this week. "We expect the rest of this year to be relatively weak given the combination of a more cautious consumer, a pull back in incentive activity, and continued payback for this summer's gains." GM added $1,000 rebates to existing discounts of $3,500 to $6,000 on 2005 cars and trucks. Ford extended six-year zero-percent interest loans on select 2005 truck models such as the Ford F-150 pickup, and the Explorer, Expedition and Lincoln Aviator SUVs. Since offering employee-style discounts to consumers last summer, Detroit automakers have struggled to shift to everyday low pricing with the 2006 model-year. Average discounts offered by Detroit automakers dropped from $3,730 in October 2004 to $2,992 last month, but sales at GM and Ford dropped about 26 percent. "While we had a good month in October with a 1 percent increase, we recognize that the retail side was not a good month for any automaker, both domestic and foreign," DaimlerChrysler AG's Chrysler Group Kevin McCormick said.

[kiljoy]

Makes 'em look like junkies the way they swear 'em off then come crawling back... Tony

[cmattson]

Don't be disappointed; GM isn't the only one increasing incentives:
http://news.yahoo.com/s/ap/20051103/ap_on_...centives_glance

I think GM was too optomistic in moving too quickly from incentives to "total value pricing".

Interesting to note that GM incentives were down almost 25% while Toyota was increasing their's by almost 16%.

[cmattson]

Okay, here's more fun: If you look at average incentives (not weighted by units sold), GM's average incentive per vehicle is $1223.21 Age of vehicle since last design/redesign & average incentive: 1999 (8 yrs old): Silverado, Sierra: $2750 2000 (7 yrs old): Yukon, Yukon XL, Suburban, Tahoe: $3500 2002 (5 ys old): Rendezvous, Escalades, Avalanche, Trailblazer, Envoy, Vue:$1750 2003 (4 yrs old): CTS, Express, SSR, Svanna,H2,Vibe,9-3,Ion: $375 2004 (3 yrs old): Rainier, SRX, XLR, Aveo, Colorado, Malibu, Canyon, Grand Prix: $1063 2005 (2yr old): LaCrosse, Terraza ,STS ,Cobalt,Corvette, Equinox, Uplander, G6(sedan), Montana, 9-2, 9-7, Relay: $833 2006 (1 yr old): DTS, HHR, Impala, Monte Carlo, H3, G6 (coupe), Solstice, Torrent: $563 GM has 21 vehicles with $0 cash incentive, 3 with $500, 8 with $1000, 9 with $1500, 1 with $2000, 6 with $2500, 3 with $3000, and 6 with $3500. GM trucks & suv's account for every incentive > $2000 (all full-sizers + Envoy, TB, Rainer) As you can clearly see, GM's oldest (& highest volume) pickups/suv's are killing GM's incentive average when you weight it by the number of units sold. All data was gathered from the north central region of www.gm.com. Data for each vehicle as follows: 2006 Vehicle Total Cash Year Released Age Chevrolet Silverado 1500 $3,000 1999 8 Chevrolet Silverado 2500/3500 Reg, Extended & Crew Cab $2,500 1999 8 GMC Sierra 1500 $3,000 1999 8 GMC Sierra 2500/3500 Reg, Extended & Crew Cab $2,500 1999 8 Saab 9-5 $0 1999 8 Chevrolet Suburban $3,500 2000 7 Chevrolet Tahoe $3,500 2000 7 GMC Yukon $3,500 2000 7 GMC Yukon Denali $3,500 2000 7 GMC Yukon XL $3,500 2000 7 GMC Yukon XL Denali $3,500 2000 7 Buick Rendezvous $2,500 2002 5 Cadillac Escalade ESV $0 2002 5 Cadillac Escalade EXT $0 2002 5 Cadillac Escalade $0 2002 5 Chevrolet Avalanche $3,000 2002 5 Chevrolet TrailBlazer $2,500 2002 5 GMC Envoy $2,500 2002 5 Saturn VUE(6) $0 2002 5 Cadillac CTS $0 2003 4 Chevrolet Express $1,000 2003 4 Chevrolet SSR $0 2003 4 GMC Savana $1,000 2003 4 HUMMER H2 $0 2003 4 Pontiac Vibe $500 2003 4 Saab 9-3 $500 2003 4 Saturn ION Sedan(6) $0 2003 4 Buick Rainier $2,500 2004 3 Cadillac SRX $0 2004 3 Cadillac XLR $0 2004 3 Chevrolet Aveo $500 2004 3 Chevrolet Colorado $1,500 2004 3 Chevrolet Malibu $1,000 2004 3 GMC Canyon $1,500 2004 3 Pontiac Grand Prix $1,500 2004 3 Buick LaCrosse $1,500 2005 2 Buick Terraza $1,500 2005 2 Cadillac STS $0 2005 2 Chevrolet Cobalt $1,000 2005 2 Chevrolet Corvette $0 2005 2 Chevrolet Equinox $1,000 2005 2 Chevrolet Uplander $1,500 2005 2 Pontiac G6 Sedan $2,000 2005 2 Pontiac Montana SV6 $1,500 2005 2 Saab 9-2X(4) $0 2005 2 Saab 9-7X SUV(4) $0 2005 2 Saturn RELAY(6) $0 2005 2 Cadillac DTS $0 2006 1 Chevrolet HHR $0 2006 1 Chevrolet Impala $1,000 2006 1 Chevrolet Monte Carlo $1,000 2006 1 HUMMER H3 $0 2006 1 Pontiac G6 $1,500 2006 1 Pontiac Solstice $0 2006 1 Pontiac Torrent $1,000 2006 1

[caddycruiser]

WHOA! I think we've hit an all-time factory to buyer incentive level: 2005 Suburban - $7,000 Yukon XL - $7,000 :blink: Good lord is that a sign of an extremely over priced old design.... :o Edited November 4, 2005 by caddycruiser

[Flybrian]

WHOA!  I think we've hit an all-time factory to buyer incentive level:

2005
Suburban - $7,000
Yukon XL - $7,000

:blink:

Good lord is that a sign of an extremely over priced old design.... :o

[post="38595"]<{POST_SNAPBACK}>[/post]

I've seen worse - $8k cash on the hood for a Grand Marquis and $10k back for a Town Car.

[daves87rs]

Don't be disappointed; GM isn't the only one increasing incentives:
http://news.yahoo.com/s/ap/20051103/ap_on_...centives_glance

I think GM was too optomistic in moving too quickly from incentives to "total value pricing".

Interesting to note that GM incentives were down almost 25% while Toyota was increasing their's by almost 16%.

[post="38570"]<{POST_SNAPBACK}>[/post]

Yep, everybody is going to start suffering soon



*sniff* *sniff* Is that scent of things slowing down? Why, Yes, I think it is... :(

I know a few people who putting off a new car because of the gas surprises...
up/down market.....

A neighbor working at a Honda dealership as noticed things have quieted down
a bit in the last few weeks...

[daves87rs]

WHOA!  I think we've hit an all-time factory to buyer incentive level:

2005
Suburban - $7,000
Yukon XL - $7,000

:blink:

Good lord is that a sign of an extremely over priced old design.... :o

[post="38595"]<{POST_SNAPBACK}>[/post]

No, that it the sound of a trend dying.... :(

[Delta Force79]

No, that it the sound of a trend dying.... :(

[post="38654"]<{POST_SNAPBACK}>[/post]

Indeed....can the demise of the allmighty SUV be on the horizon? proably not right away but within the next few years....I'll bet on it

[Fesasp]

If you are able to find any of the '05 Special Value Cavaliers & Sunfires (it will be tough.) The rebates will being the prices down to $7000 for the Cavalier and $7500 for the Sunfire. It appears that GM wants to rid itself of all of the remaining J-cars for good. These J-cars ome with A/C and a CD player with the 1SV trim. An 2005 SVM trimmed Aveo is going for $8000 after the rebates. I still saw several listed in and around Chicagoland on GM Buypower.

[FUTURE_OF_GM]

The industry as a whole is slow.... I'm impressed by the incentive reductions though. We all knew it would be painful, so did GM. But the trends are cautiously opimistic. GM PLEASE don't over do it again!! Nice correlation to Wal-Mart by the author, to emphasize cheapness BTW.

[aurum]

The industry as a whole is slow....

I'm impressed by the incentive reductions though. We all knew it would be painful, so did GM.

But the trends are cautiously opimistic. GM PLEASE don't over do it again!!

Nice correlation to Wal-Mart by the author, to emphasize cheapness BTW.

[post="39844"]<{POST_SNAPBACK}>[/post]

If gas prices are high, then this is the perfect time to buy a new vehicle, albeit a smaller, more fuel-efficient one. The only reason people would wait to buy now is to they can get another gas guzzling monster SUV