GM Sticker Price Cuts

[HarleyEarl]

Like stickers, GM's rebates dip as new pricing strategies take hold

By JOHN K. TEAHEN JR. | AUTOMOTIVE NEWS

AutoWeek | Published 02/07/06, 9:23 am et

DETROIT -- Cutting sticker prices seems to be doing the job that General Motors assigned to it: enabling the automaker to scale back its huge rebates on cars and light trucks.

We don't mean the first attempt at lower stickers, which GM installed last fall. Those stickers showed minimal reductions from 2005 prices, and they followed a summer of employee pricing, with its heavy discounts.

The pricing strategy fell on its face then, and GM stopped talking about it.

But the company decided to give it another chance. On Jan. 11, it announced a wide range of reductions, many of them $1,000 to $3,000. With them came a new set of incentives that ran until Jan. 31. Now, the February-March incentives have been put in place, and they are largely unchanged from the January offers.

Most rebates are in the $500-to-$1,500 range, much lower than GM has been offering during the past year. The automaker is hopeful. The new price-rebate system helped GM increase the U.S. sales of its North American brands 5.8 percent in January.

A few big rebates ($5,500-$6,000) remain, but they are designed to clear out leftover full-sized 2006 SUVs that have been replaced in showrooms by what GM calls 2007 models.

Ford division hasn't matched GM's January price cuts, but it is aping GM on the rebate side. Payments of $500 to $3,000 abound.

The Chrysler group also is watching its pennies, but the Chrysler Pacifica and Town & Country bring $3,000, and so do the Dodge Caravan and Grand Caravan, Durango and Ram 1500.

GM's incentives expire March 31, Ford's and Chrysler's on Feb. 28.

[turbo200]

The commercials for Chevy during the Grammys highlighting the value equation were great. I really liked the emphasis on quality and style over price. I also liked the gas mileage commercial. toyota's commerical on mpg is so damn hypnotizing in this part of the country, just one though of it and that damn song comes to mind, "i want my, i want my mpg!"........they're freakin geniuses, those Toyota marketing execs. That's exactly the way to capture people's attention sometimes, by grating thier nerves. But ya, back to topic, the value equation is a good one. I hope we continue to see positive momentum and results. I think the new trucks will help to bring in traffic too. I showed the Tahoe to a very very discriminating friend [i don't use that word in a bad context, discriminating as in hihgly particular], and he really liked it.

[pow]

The "Only GM" commercial was soooooo brilliant. It had good music, it showed lots of innovation, it showed GM's history... brought a tear to my eye.

[Newbiewar]

i havent noticed any extra traffic at the dealer...

although i've noticed more people cross shopping us against toyota, which is either good or really bad i'm not sure...

and i really am pissed about the perceived quality of toyota, cause i cant argue it... cause then it just pisses customers off... i can simply point to the JDPA sticker on the window to say our heavy duty trucks are best in class, but thats about it...

[sciguy_0504]

"I want my, I want my MPG!" Never saw that commercial yet. It does like like an awesome ad idea.

[Newbiewar]

"I want my, I want my MPG!"  Never saw that commercial yet.  It does like like an awesome ad idea.

its really annoying, but like i posted over at CZ28.com their prius owners are probably chanting that...

they are like you promised me 60 mpg... "I WANT MY MPG!"

[turbo200]

it's the most annoying, blatant, and subliminal commercial ever. Like a lot of toyo commercials, it gets in your head and communicates perfectly the message.....toyota's have good mileage. Damn that song. Brilliant scientists those Toyota marketers.

[haypops]

I thought the SS commercial during the granny's where all those black SS's entered the traffic circle and looked liked a 45rpm vinyl record was truly unique. Good job.

[ellives]

Toyota's marketing certainly underscores GM's lack thereof. GM needs to sharpen the message. Why should I buy GM? There's so many choices out there. Play up the American aspect of buying GM but stay on message. And on a side note they need to bump up their warranty. 3/36 is silly in today's market and they should not have any trouble meeting a longer period.

it's the most annoying, blatant, and subliminal commercial ever. Like a lot of toyo commercials, it gets in your head and communicates perfectly the message.....toyota's have good mileage. Damn that song. Brilliant scientists those Toyota marketers.

[Newbiewar]

Toyota's marketing certainly underscores GM's lack thereof. GM needs to sharpen the message. Why should I buy GM? There's so many choices out there. Play up the American aspect of buying GM but stay on message. And on a side note they need to bump up their warranty. 3/36 is silly in today's market and they should not have any trouble meeting a longer period.

i was pushing this on the fastlane...

at our dealership our GM trainers teach us about how each engine GM makes (except the aveo) has 5-6 long life components that the competition doesnt have, and all of them have at least 100k mile life expectancy... so if they expect everything to last 100k miles, and they are saying how it wil save the consumer money... well, why not foot the bill if the consumer wont have to replace these items anyway...

[4gm]

i was pushing this on the fastlane...

at our dealership our GM trainers teach us about how each engine GM makes (except the aveo) has 5-6 long life components that the competition doesnt have, and all of them have at least 100k mile life expectancy... so if they expect everything to last 100k miles, and they are saying how it wil save the consumer money... well, why not foot the bill if the consumer wont have to replace these items anyway...

I think that's a great idea, much better than having a typical 3-5 year warranty. Those don't draw customers in the way they once did. In fact, I'd say most people don't care about them anymore. They expect their new cars to be reliable. Why should they even need a warranty?

I'm sure most car owners worry about having to get engine work done somewhere down the line because they know it might potentially cost them a lot of money. Having a program that would cover the cost of repairing those 5-6 engine parts with under 100,000 miles on them would go long way towards relieving some, though not all, of the worries a lot of customers have about GM's quality. Not only that, but it's a very clear and direct marketing message, kind of like no-haggle pricing or 0% financing, that no other automaker has.

Assuming GM's engines really are this reliable, having this kind of engine warranty is something GM should really consider. I wouldn't market a program like this as a warranty, though. I'd spell things out for the customer. "If these engine parts don't last 100,000, we'll pay for their complete repair", something along those lines.

[FUTURE_OF_GM]

DETROIT -- Cutting sticker prices seems to be doing the job that General Motors assigned to it: enabling the automaker to scale back its huge rebates on cars and light trucks.

We don't mean the first attempt at lower stickers, which GM installed last fall. Those stickers showed minimal reductions from 2005 prices, and they followed a summer of employee pricing, with its heavy discounts.

The pricing strategy fell on its face then, and GM stopped talking about it.

Maybe it succeeded this time because GM actually MARKETED IT!!!!!! Jesus GM, what does it take to make your people understand that people just don't innately KNOW about this stuff!

But the company decided to give it another chance. On Jan. 11, it announced a wide range of reductions, many of them $1,000 to $3,000. With them came a new set of incentives that ran until Jan. 31. Now, the February-March incentives have been put in place, and they are largely unchanged from the January offers.

Most rebates are in the $500-to-$1,500 range, much lower than GM has been offering during the past year. The automaker is hopeful. The new price-rebate system helped GM increase the U.S. sales of its North American brands 5.8 percent in January.

Positive progress!!!!! I'm sure all of the negative PR this week will STALL that sh*t right in it's tracks for February though.