The Truth About Cars » Incentives

GM Announces Year-End Blowout Sale

Edward Niedermeyer — Mon, 16 Nov 2009 17:45:01 +0000

Well, we’ve already been warned that GM’s 4Q cash burn and financial results will be worse than the just-released 3Q results; now we have another reason why. Even though GM has been averaging just over $4,000 per vehicle in incentives, a traditional Red-Toe-Tag sale has been planned for year’s end, reports Automotive News [sub]. As [...]

Smart Cars Play The Incentive Game

John Horner — Fri, 13 Nov 2009 02:46:11 +0000

US sales of the not very Smart car have fallen off a cliff. The Financial Times reports that “Smart sold only 661 of its fortwo model in the US last month, more than two-thirds below October 2008 and the lowest for any month since the car made its debut in the US early last year.” [...]

Quote Of The Day: Don’t Hate The Playa, Hate The Game Edition

Edward Niedermeyer — Fri, 30 Oct 2009 21:46:08 +0000

I’m not going to tell you incentives are going away. They’re part of the game, but they can be better managed than they have been in the past GM Sales maven Susan Docherty in the WSJ.

Ram HD Strategy: Preemptive Incentives

Edward Niedermeyer — Mon, 26 Oct 2009 16:00:40 +0000

It’s 2009, and Chrysler Group is still hugely dependent on Ram sales to keep dealer volume flowing. Not that there’s anything wrong with pickups per se, but dependence on a shrinking market (down 34 percent year-to-date, compared to 27 percent reduction for all light-duty vehicles) is never a good thing. Cutting into profits to keep [...]

Deal Of The Day: $42k Off A Tesla Roadster?

Edward Niedermeyer — Fri, 23 Oct 2009 18:01:36 +0000

That’s right. Buy a $110,000 Tesla Roadster, and according to the Denver Post, the state of Colorado will give you $42,000 in tax breaks. That’s 85 percent of the premium over a Lotus Elise. Colorado’s alt-fuel and zero-emissions tax credit system gives between 50 percent and 85 percent of the premium over a comparable gas-burning [...]

Average Incentives Year-To-Date

Edward Niedermeyer — Thu, 15 Oct 2009 16:58:05 +0000

1. Chrysler Group $4,584 +18% 2. GM $3,796 +6% 3. Ford Motor Co. $3,451 +2% 4. Hyundai-Kia $2,998 +40% Industry Average $2,835 +10% 5. Nissan North America $2,511 +19% 6. Toyota Motor Sales $1,620 +22% 7. American Honda $1,310 +9% Through September, as calculated by Edmunds [via Automotive News [sub]]

GM’s New Incentive Programs Revealed

Robert Farago — Fri, 02 Oct 2009 16:01:04 +0000

A TTAC source asks us to perform the following mental exercise: “Just imagine that you’re a car salesman and you come into work this morning. Your boss says we have a bunch of new incentive programs you need to learn. And here they are . . .” Date: 09/30/2009 Ref. number: Sales / Incentives / Subject: All Regions [...]

Quote Of The Day: There Are Incentives And Then There Are Incentives Edition

Edward Niedermeyer — Tue, 29 Sep 2009 20:13:47 +0000

The big blockbuster, peanut-butter-approach programs like zero-percent financing and employee discounts for everyone have all been done before GM spokesman John McDonald in a Bloomberg story on the industry-wide drop in incentives and rising transaction prices. What about Truck Month? Surely we can all agree that has been “done before.” And though the Detroit automakers have [...]

Quote of the Day II: Truck Month Strikes Back Edition

Edward Niedermeyer — Thu, 24 Sep 2009 23:42:45 +0000

This is good — the money on the trucks. The money on the 2010 models is a nonevent because there aren’t any of them in stock . . . The incentives are good advertising to get people in the door, then we can sell them whatever we have in stock. Tommy Brasher, owner of Brasher Motor [...]

The Tragedy of the Clunkers

Edward Niedermeyer — Wed, 23 Sep 2009 15:45:45 +0000

Economics professors Burton Abrams and George Parsons sum up the Cash for Clunkers tragedy wonderfully in their essay Is CARS a Clunker? [PDF available here]. “Concentrated benefits create vocal advocates, while diffused costs produce silent, apathetic opponents,” they conclude after showing that the costs of crushing clunkers outweighed the benefits by about $2,000 per vehicle. [...]

May the Best $500 on the Hood Win

Edward Niedermeyer — Fri, 18 Sep 2009 15:15:53 +0000

We don’t have any numbers yet on GM’s 60 day money-back guarantee, but according to GM dealers speaking to Automotive News [sub] it’s not generating a lot of interest. “If [customers] like the car, if they test drive the car, most of the people would rather have a car to keep,” explains one dealer. Which [...]

Michigan Small Car Assembly Bid “Loss Leader”

Edward Niedermeyer — Mon, 14 Sep 2009 18:21:28 +0000

Positive Post of the Day: 60 Day Return Policy Won’t Be Ruinous for GM Edition

Edward Niedermeyer — Thu, 10 Sep 2009 20:17:43 +0000

But only because dealers will be forced to give up a half a percent of their profit margin, reports Automotive News [sub]. Good thing Mark LaNeve says volume will be higher. Otherwise that might suck for the dealers. As Bob Lutz puts it, “We’re putting our money down that if people buy one of our [...]

Moneybags GM to Cover Clunker Deals

Edward Niedermeyer — Thu, 20 Aug 2009 15:01:51 +0000

General Motors has announced that it will lend dealers cash to cover their government clunker rebates for 30 days while the NHTSA figures out how to wind down the program. “We want to do all we can to provide customers with timely new vehicle deliveries and dealers the liquidity they need to run their businesses,” [...]

Dealers Call Out Cash for Clunkers

Edward Niedermeyer — Thu, 20 Aug 2009 13:55:42 +0000

Would you believe that two-thirds of all car dealers are still waiting for their first clunker check? Could you imagine that only three percent of all clunker deals have been been blessed by NHTSA? Automotive News [sub] has the survey for you! The only problem is that AN admits the poll was unscientific. Plus, it [...]

Auto Alliance: Cash for Clunkers is NOT Dead. Yet.

Frank Williams — Fri, 31 Jul 2009 13:54:15 +0000

The Alliance of Automobile Manufacturers’ Senior Director of Communications has informed TTAC via email that the CARS (AKA “Cash for Clunkers”) program has NOT been suspended. ”All deals concluded before a suspension is announced (if that happens) will be honored,” promises Charles Territo. We’ve also heard that the President is urging Americans NOT to not buy a new [...]

Cash-for-Clunkers: $68,923,000 Down, $931,077,000 to Go (Minus Handling Fee)

Robert Farago — Wed, 29 Jul 2009 22:51:34 +0000

Our good friends at The Department of Transportation report the latest C.A.R.S. (Cars Allowance Rebate System) or Cash-for-Clunkers clunker stats as of right . . . now. Total Vehicles Sold: 16,351 Funded to Date: $68,923,000 Passenger Cars Due for Euthanization: 10,114 Trucks Headed for the Crusher: 6237 Meanwhile, we intercepted this communication from a dealer: “I wish you would let us [...]

Cash for Clunkers: Wow! What a country!

Robert Farago — Wed, 29 Jul 2009 02:17:29 +0000

Chrysler Offers “Double CA$H” for Your Clunker

Edward Niedermeyer — Wed, 22 Jul 2009 14:57:03 +0000

Actually, that’s misleading. “Everyone shopping for a new car or truck qualifies for an incentive of up to $4,500 — even if they don’t have a vehicle that qualifies under the U.S. Government’s program,” says ChryCo Sales VP Steven Beahm in a press release. “This incentive is great in that it’s easy to understand and [...]

Buickman: New GM’s Incentives Are Nuts. Again. Still. Only More So. Again.

Robert Farago — Fri, 17 Jul 2009 20:01:17 +0000

Buickman writes: Well, we called it . . . new incentive sheets this morning, and already they are being corrected because GM’s own website verification software is wrong. Check out this email from GM to dealers . . . “Please be advised that the new Employee Bonus Cash was NOT intended to be compatible with the outboarded APR’s. [...]

How Orion Township Won Chevy Viva Production

Edward Niedermeyer — Mon, 29 Jun 2009 18:32:20 +0000

Er, bought. According to the Freep, the Michigan Economic Growth Authority put together the $779 million tax credit package which secured Orion Assembly’s future as the home of the Chevy Aveo’s replacement. A 25-year, 100 percent tax abatement from the municipality of Orion Township (worth some $100 million) didn’t hurt either. Nor did Oakland County’s [...]

Clunker Plan Enters Regulatory Hell

Edward Niedermeyer — Thu, 25 Jun 2009 05:35:27 +0000

Or is that regulatory purgatory? Automotive News [sub] screams “Dealers decide who gets discounts,” confirming that America’s very own scrappage scheme is not going to be the quick eco-nomic (geddit?) stimulus the fans predicted. Of course, AN was getting a bit histrionic; the headline was just their wacky way of explaining that NADA is advising [...]

GSA Refuses to Identify Models in Fed’s 17,205 Detroit Purchase

Robert Farago — Thu, 11 Jun 2009 21:01:37 +0000

Good afternoon, I am responding on behalf of my colleague Bob Lesino [PR for the General Services Administration] and at this time we can’t provide any other information than what was in the press release. Thank you. MaryAnne Gee, I wonder if this has anything to do with the country of origin for these vehicles . . . TTAC will now [...]

Honda, Nissan Incentives Reach Record Highs

Edward Niedermeyer — Fri, 05 Jun 2009 18:13:47 +0000

But still can’t touch the domestics. An Edmunds press release (via Business Wire) reveals current incentive levels for the major automakers in the American market. According to Edmunds’ analysis, “premium sport cars had the highest average incentives, $6,865 per vehicle sold, followed by large SUVs at $4,267. [...]

Chrysler Blood in the Water Draws Sharks

Edward Niedermeyer — Wed, 03 Jun 2009 20:35:11 +0000

Shark number one is Ford, which is making a concerted effort to steal sales from its cross-town rival. Automotive News [sub] reports that Ford is rolling out a regional incentive program aimed at existing Chrysler owners. Ford is offering Chrysler owners an additional $500-$1,000 on the purchase of a new Ford to owners of Chrysler [...]