By on December 11, 2012

Last week, we told you to not buy a full-sized GM pickup just yet, and to hold out for big discounts from GM. You did not have to wait long. However, you may want to wait a little more.

The company that swore discipline and to protect profits now offers incentives as high as

$5,000 per pickup, Bloomberg reports.

This is probably just the opening volley in an all-out incentive war.

There are rebates worth $8,200 for Dodge Rams. TrueCar figures that Ford lubricates its pick-up deal with $6,500 on average. Nissan advertises rebates worth $7,450 for its Titan pickup.

Last Friday, GM doubled cash incentives and sweetening lease terms on some vehicles, including Chevrolet Silverado and GMC Sierra pickup trucks.

By end of November, GM was looking at pickup inventories of 245,853 units. That’s 4½ months of sales of Chevrolet Silverados and nearly five months of sales of its GMC Sierra.

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44 Comments on “The Incentive Wars: GM Cries Uncle. Let Them Cry A Little Louder...”


  • avatar
    Joe McKinney

    Nissan still makes the Titan?

  • avatar
    ajla

    They might advertise $5k, but GM dealers are willing to entertain just about any offer on the trucks right now. Five figures off isn’t hard to get.

    • 0 avatar
      highdesertcat

      Yahoo! News has a story about $13K OFF MSRP on Silverado and in my area they advertised $13K OFF MSRP on ALL remaining Silverado trucks in stock, this past Sunday. That includes the 2013 models.

      If anyone wants a RAM, they’re going for $8K OFF MSRP, and that includes the 2013 models in my area. If they ever advertise $10K OFF a 2013 Jeep Grand Cherokee, I would be motivated to trade our old 2008 Highlander in for a second Overland Summit, maybe with a 5.7 this time.

      I know several guys who traded their old GM trucks for a 2012 and got $10K off, but now that doesn’t seem like such a good deal any more.

      • 0 avatar
        sunridge place

        Oh my!

        A yahoo! news story!

        $13,000! off all Silverados!

        All of them! Including 2012! and 2013!?!

        It must be true!

        But! It was only last Sunday?!?

        No! Way!?!

      • 0 avatar
        sunridge place

        good lord HDC….i googled the yahoo news article you probably read:

        http://autos.yahoo.com/blogs/motoramic/13-000-off-chevy-pickups-deals-pushing-december-164546615.html

        really???

        13k off MSRP on Silverado all silverados in your area based on this article?

        You either need some new reading glasses or you should stop giving your view on the current sales environment.

        seriously…consider one of the two above options

  • avatar
    KixStart

    Curiously enough, GMC Sierra hybrid pickup sales jumped from something like 20 units/month to 170 units/month. Is GM offering some sort of blowout deal specifically on those?

    • 0 avatar
      sunridge place

      That sort of jump smells like a fleet order being fulfilled….most of GM’s Hybrid Truck sales are fleet.

      • 0 avatar
        KixStart

        That reminds me of the thing strange thing about the hybrid – it’s all Crew Cab. I would think a fleet operator would want the 8-foot bed, rather than space for 5 people.

      • 0 avatar
        sunridge place

        I agree…its odd. But in 2011, 70% of Silverado Hybrids went to fleet…mostly commercial fleet vs govt or rental.

        They build very, very few of these each year and its going to be killed in the redesign.

        http://www.automotive-fleet.com/statistics/

        November #’ sounds like somebody made an order for 150 or so Sierra Hybrids a few months ago and they fulfilled it in November.

  • avatar
    Verbal

    Coinciding with the recent drop in gas prices, they should get them to move. The lifestyle pick up truck intenders will come crawling out of the woodwork.

  • avatar
    dave504

    More one-sided “reporting” from TTAC, as usual. The Ram and F150 incentives are for the outgoing 2012 models, as both have refreshes due next year as does the Silverado/Sierra. The Ram gets a new interior and the 8-speed ZF transmission while the F150 gets a facelift, HID’s, and some interior updates. Not to mention that those incentives are the maximum, not average as TTAC is reporting and they are only for the most expensive and feature-laden models.

    A quick trip to TrueCar or the Ford or Ram websites would have confirmed this – The only Ram model eligible for $8200 worth of rebates is a 2012 Lone Star Crew Cab 4×4 (per Ram website), and the closest I could find for the F150 is $6002 for a 2012 4×4 Platinum (per TrueCar). Two minutes of journalism instead of regurgitating Bloomberg’s press release would have told you this.

    BTW, did anyone else notice that the fine print in the above image states “1 at this price”? Of course, when you get there, that one has JUST been sold but we have another one that’s only a few hundred bucks more expensive.

    • 0 avatar
      gslippy

      Do the Ram and F-150 have 140 days’ worth of inventory sitting around, while more are being built? That’s the problem here – deep discounting is needed to move excess inventory. Merely last-model inventory doesn’t need to be given away.

  • avatar
    DeadWeight

    I’m going to wait until dealership stacked pickup inventories hit 1 million, then go in with a really low ball offer.

    I’d like to pull that Chevy small block V8 out for a different use, and would transplant a biofuel diesel in there in exchange for a Solyndra type subsidy.

  • avatar
    stephenjmcn

    Bertel, you berate GM for discounting to move the metal with a new model just round the corner. Their competition, as you acknowledge are doing the same thing.

    What would your take be if they had remained ‘disciplined’ and all those trucked remained unsold. Again, in the context of their main competition discounting.

    I can take or leave most GM products (no biases), but the more of your articles I read, the more I wonder what they could possibly do to win with you.

    • 0 avatar
      gslippy

      They could NOT build up a 140-day supply of trucks and count them as ‘sold’. That’s why they have to give them away now.

    • 0 avatar
      George B

      It appears that GM was stuffing the channel with pickup trucks to appear more healthy than it is. When a publicly traded company records sales of an item to a reseller and then later has to come up with cash incentives to help the reseller sell the product to the end customer, what does this do to their accounting and legal standing with the SEC? The fact that the federal government is itself a major stockholder and the fact that inventory buildup came before the election and the huge rebates came after the election doesn’t look good. GM is alive and Osama bin Laden is dead.

      • 0 avatar
        sunridge place

        An SEC investigation because there is $4000 rebate on a truck?

        You people are priceless.

      • 0 avatar
        moedaman

        This doesn’t warrant any action by the SEC. BUT, stuffing the sales channel before the election and deep discounts after was predicted by many here.

      • 0 avatar
        sunridge place

        Hey moedaman..

        GM was telling everyone they were going to carry a high inventory. Its not like this is a surprise. You are giving the so-called Best and Brightest a little too much credit there buddy.

        GM was as 246,000 trucks in inventory versus a year end target of 220,000. About 12% over the year end target.

        They will probably sell more than they build in December due to plant holiday shutdowns. Hardly a cause for hysteria and conspiracy…but GM is the Kim Kardashian of this site…so not surprising.

        Truck incentives today (even with increases in December) are not really different than they have been in the past. GM is in line with the competition in December although they do have an older product line for now.

      • 0 avatar
        KixStart

        Yes, GM has repeatedly and noisily warned everybody what they were doing. Still, does the math add up?

        The model changeover and holiday shutdown will take out all GM’s production for m-a-y-b-e 2.5 months. That brings their 2012 inventory down to 2 months when they roll into new model availability.

        That seems excessive; since it’s a relatively comprehensive update, the old trucks become white elephants on new model availability. Serious discounting will result.

      • 0 avatar
        sunridge place

        You act like the inventory of the new trucks will just magically appear in one delivery on a particular Tuesday after they start production.

        It doesn’t work that way…production ramps up. Look at Ram, they started the new 2013 Ram production in September.

        Guess what % of their November sales were the previous (2012) generation?

      • 0 avatar
        el scotto

        GM is the Kim Kardashian of this site That sir, is priceless.

      • 0 avatar
        porschespeed

        Not only priceless, but incredibly accurate.

        Fat, bloated, dysfunctional, retarded, and only attractive to those who don’t know any better. Take it home and you’ll hate it.

        The hits just keep on comin’…

  • avatar
    -Cole-

    Ally Bank will fix it.

  • avatar
    Zackman

    I’m waiting to hear “Buickman”, “Doctor Olds” and “Nullo” weigh in on this.

    I don’t have a problem with deep discounts, either. That’s the reason I’m driving an Impala LTZ, even if my old car was perfectly fine! Works for me, even if it doesn’t say good things about GM or anyone else that has to do the same thing to move the metal.

    Companies are going to have to cut back on production with the resulting loss of jobs to realistically adjust to market realities. In other words, people simply, for the most part, don’t have the money, or don’t want to risk making payments in an increasingly iffy job market with the prospect of coming to work on a Thursday and finding out their position has just been eliminated – it happened to three people here two weeks ago.

    I’m nervous about that, too, as I’m of prime age to be tossed aside with almost ’0′ chance of finding another job that pays in the same ballpark as my present one. I may be next…

    • 0 avatar
      DeadWeight

      I’m keeping my present vehicle for 8 more years. It’s 7 years old now, but runs like new and I am very meticulous about maintenance.

      And I’m at least “well off” by conventional standards.

      One good thing to come out of this crisis of debt and entitlement is that those paying attention will never make the mistakes of the past again in their lifetime, just like my grandparents who lived through the Great Depression told me that debt was a cancer while younger people laughed and bought pets.com stock on margin in 1999 or a 9 bedroom McMansion in 2006.

    • 0 avatar
      sunridge place

      Buickman will just say that its all bad marketing and that, if the suits would just listen to his ideas– GM would be back to 30% marketing share…and it won’t cost a penny.

      Much like a late night infomercial.

      By the way, you write your post like auto and truck sales are down…in case you don’t realize it, they aren’t…they are up this year pretty much across the board. And, OEM’s are pretty much all making a lot of money.

      This truck inventory crisis is a bit dramatic. GM has about 15,000 more trucks in their inventory right now than they wanted to…about 15-20 days more supply than they projected.

      Truck sales usually are very high in December…a lot of companies taking advantage of tax deductions etc.

      It will be very interesting to see how December sales play out.

      • 0 avatar
        DeadWeight

        And consumer debt just hit a new record high just as the U.S. Government’s has, so congrats all around, because I’m sure that all is well that ends well, and that “this time will be different.”

        US consumer borrowing rises to record $2.75T – The Denver Post
        http://www.denverpost.com › Business News
        By MARTIN CRUTSINGER AP Economics Writer
        3 days ago – WASHINGTON—Americans swiped their credit cards more often in October and borrowed more…

        http://www.denverpost.com/business/ci_22147009/us-consumer-borrowing-rises-record-2-75t

      • 0 avatar

        prophets and geniuses are rarely recognized during their lifetimes. Van Gogh only sold one painting while living. check my record, you’ll miss me when I’m gone.

  • avatar
    8rings

    I’m not sure these incentives are any better than they are any other year. I purchased a 07 Silverado only a few months after the GMT900 intro for $8,300 off MSRP and the local dealers advertise $10k off MSRP almost every year around here, (“with over 150+ to choose from!”) Who doesn’t get at least $8k MSPP off ANY half ton?

  • avatar
    Slab

    The numbers in that ad don’t add up (38,395-3,500-3,000-1,000=30895). Scratching my head.

  • avatar
    APaGttH

    So let me get this straight, according to the research done here using the above story to goose truck sales:

    Ram dealers are lubricating things with up to $8,200
    Nissan is lubricating things with up to $7,450
    Ford is lubricating things with up to $6,500

    Funny how Toyota got left off. Well I checked TrueCar, in my market up to $4,850 worth of lubrication.

    GM is putting $5,000 worth of lubrication in their vehicles.

    Ram – just redesigned
    Ford – redesigned about 18 months ago give or take?
    Toyota – redesigned four years ago
    Nissan – redesigned about five years ago
    GMT900 – oh came out in 2007

    So GM has the second least rebates on the oldest design pickup truck on the market.

    The great thing about the internet is you can visit the dealer in the graphic, and look for yourself…

    http://www.wentworthchevrolet.com/VehicleDetails/new-2012-Chevrolet-Silverado_1500-Work_Truck-Portland-OR/1740029473

    So – this example has a $2,000 + $2,000 + $1,000 rebate structure.

    BUT – if you take the first $2,000, you can’t get the low financing rate – so Ally will almost certainly make up more than $2K in the interest. Go with low financing, you get $3,000 cash back (click on the disclosures and read it yourself).

    So yes, it is “up to $5,000″ in rebate – if you want to get taken to the cleaners on the interest rate.

    Devil is in the details but popcorn tastes better after it has been spun.

    • 0 avatar
      KixStart

      Cash lube or option lube?

      There’s a big difference between the two.

      • 0 avatar
        APaGttH

        Good question, but the math I used above came right from the story above written by Bertel. So I don’t know if those numbers are cash lube, option lube, additional dealer incentive lube, a combination of all of the above.

        Option package “savings” I’ve always generally seen as just funny money complete BS. Oh, gas prices are high and were sitting on a stack of V8 engines, we’ll give an “option package savings” of a V8 engine. You save $1,500 Mr. Customer. Oh we put on chrome plated rims worth $1000 more than the painted aluminum ones (even though that chrome plating probably cost the manufacturer $25 or $50 a wheel).

        Additional dealer incentives are also a bit a bad measurement to use. What a shock, BMW and Mercedes have some of the largest dealer incentives – of course they are taking money off of sticker prices, look at the base sticker price. When you go to percentage of incentives to average transaction, it doesn’t look as bad (and that is the REAL measurement).

        If your average transaction prices are high, your average incentive prices are high.

        If responding to larger competitor incentives by doing your own incentives is inherently wrong, than the whole flippin’ industry is guilty as charged.

        But finally, and the most important point, only a blithering idiot would pay full sticker on a fullsize truck, regardless of maker. None of them have an MSRP close to the reality of what they sell at.

        None of them.

    • 0 avatar
      el scotto

      APaGttH http://www.bedbathandbeyond.com/product.asp?sku=40293882&utm_source=google&utm_medium=cpc&gclid=CNj_wKC8k7QCFa59OgodFnEAdQ Popcorn for all of us!

    • 0 avatar
      gslippy

      But again, APaGttH, did the other mfrs pump up their inventory like GM has? That’s the problem – not the usual year-end discounting.

      GM has enough 2012 trucks today to last through April 2013.

      • 0 avatar
        sunridge place

        Ok gslippy…I’ll call you out…you said the same thing about 4 times here and I like your opinion and comments generally.

        How would you do it?

        How would you balance the needs of dealers to have inventory during a transition in the economic environment that was/is 2012/2013?

        Remember, you are trying to get it just right…you want enough of the old model to make sure your potential customers/dealers have a reasonable choice until full supplies of the new model show up.

        Remember, there is a lot of pent up demand…the housing market might start to recover…your dealers don’t want to be short in Feb/March/April…springtime is starting…what is the economic situation going to be in this country? Come on…tell us. We all want to know.

        Remember that a truck transition has multiple cabs/drivetrains/engines/axle ratios/towing packages and isn’t the same as a new Camry or Civic.

        Example…Ram started the all new 2013 production in September. In November, 90% of their sales were still the 2012 model year. Ram had a hell of a month in November…thank god they had some 2012 inventory cuz there were ZERO rebates on the 2013. How many of those customers showed up looking at the 2013 and had limited selection and sticker shock with the 2013′s and chose a heavily rebated 2012….kind of looks like about 90% of the people who bought a Ram in November.

        Its not easy. GM overshot their production by about 12% this year from where they thought they needed to be with trucks. November killed them as they were probably 10,000-15,000 unit sales less than they thought.

        They have dialed up their rebates a bit to see what happens in December. I’ll guess they will cut some production in Q1 based upon the sales in December and better knowledge on their production plans for the new model. If sales go crazy in December, they might not.

        They made bets on production (which IS revenue when shipped to a dealer) and have to hedge those bets with extra incentives (which is a cost) if sales don’t materialize.

        They are at least 6 months away from real volumes of the new body style arriving at the dealerships.

        Oh yeah…they also really don’t want to tip off too much of the competition on their exact plans for competitive reasons.

        How would you have done it? Please, tell us.

  • avatar
    IronEagle

    HEll Ram still has 2011 Heavy Duty trucks for sale at some dealers. In North GA they are offering $12,000 off 2012 F150 XLT and $11,000 off MSRP on 2500 Rams.

  • avatar
    doug-g

    Is this Wentworth Chevytown in Portland, OR? I had no idea they were still in business. When I got transferred to Portland in 1982, my company arranged for a new Malibu to be waiting for me. I picked it up at Wentworth. They wouldn’t give me license plate frames and the car was literally running on fumes; I was lucky to make it to the first gas station. The car was parked on a right-leaning slant outside the dealership and, when I went to shut my door, it slipped and slammed. That made the window crank fly off, whiz by my face and land on the passenger’s seat. Memories…

  • avatar
    Dimwit

    Ram is weird. Chryco only updated their .ca websites for 2013 3 weeks ago. That’s how badly behind they are. When you realize the 2013′s are going to be around for only a few short weeks it’s idiotic. When the 8 speed shows up, it will be a 2014 model.

    As for GM, it looks to me from the outside like they’re really paranoid about the new model. They’re making sure they have tons of product to last for the changeover. Is it that radically different? Does it incorporate some new and complex tech? We await answers.

  • avatar
    Junebug

    I can’t believe nobody commented on how Ford, Ram and Toyota are so much better than GMC/Chevy. In my second job, I detail cars, lately it’s been pick-up trucks. I guess folks get tired of washing/waxing these damn big ass things. Anyway, the trucks with the best interiors, paint, fit-finish, are either Ford or Toyota. GM stuff is so 80′s. At
    least they made a bazillion light tan/silver ones that are easy to buff out.


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