GM Employee Pricing: You Pay LESS Than What They Pay
By Robert FaragoAugust 30, 2008 - 2,089 views
Get this. Under GM's Employee Pricing for Everyone sale, a buyer can cash-in any GM Card towards a new purchase/lease. That is, unless you're are a GM employee/retiree. No really; they're excluded from the program. In fact, if GM discovers any such transaction later, the dealer is faces a "chargeback" for the card dollars and all other applicable incentives. An MI dealer tells us that "even if you deliver the car without a code and just use GMS pricing that anyone gets, you lose." Meanwhile, The Detroit News reports that GM is going after employees who transferred their employee discounts to non-employees. Before the Employee Pricing for Everyone sale, of course. "The automaker… simultaneously filed three lawsuits alleging fraud as the company cracks down on employees, retirees and widows giving discounts to nonrelatives, according to court documents. Along with other recent lawsuits, the automaker is suing for more than $450,000 plus costs and attorney fees." Or more. "It was unclear Friday how many cases have been filed nationwide and a GM spokesman did not know how often the automaker files such cases. GM's lawyer, Michael Clawson, could not be reached… The timing of the lawsuits, three of which were filed on or after Aug. 20, the day GM extended the employee discount to everyone, is coincidental, company spokesman Tom Wilkinson said." And really lousy, I might add.
Posted in Marketing | News Blog | Sales | 24 comments 
Surprise! August Sales Sucked!
By Edward NiedermeyerAugust 29, 2008 - 2,272 views
The Detroit Free Press reports that early August sales estimates show a 14.4 percent drop in new metal moved. But don't turn off your pacemaker yet; the biggest shocker is that Detroit is bearing the overwhelming brunt of the downturn. Estimates from Edmunds show that Chrysler sales dropped 34 percent, GM slid by 27.5 percent and Ford endured a 16.3 percent drop compared to August a year ago. Toyota continues to shed sales but grow market share, slipping by half the industry average at 7.2 percent. The winners in August were Honda, which posted a 0.9 percent increase, and Nissan which defied the market to bump sales by 2.3 percent. On the whole, the market appears to be picking up slightly, with a 13.1m seasonally adjusted annual sales rate (SAAR) up from 12.6m in July. With consumer confidence rising in August, the overall economy appears to be taking its Prozac, but don't expect an auto sales turnaround this year. GM's sharp losses show that even with once-popular "employee pricing" incentives, consumer demand for cars isn't what it once was.
Posted in News Blog | Sales | 14 comments
Toyota Downsizes Global Sales Estimates
By Jehovah JohnsonAugust 29, 2008 - 398 views
According to The Detroit News, Toyota has walked down its '09 global sales estimates by 700k units, from 10.4m vehicles to 9.7m. This is the second forecast downgrade; a tacit admission by the world's largest automaker that the U.S. sales slump will not experience the rapid recovery its native carmakers have been praying for predicting. "[Toyota CEO Katsuaki] Watanabe said he saw as 'fundamental' the slowdown in the U.S. market as soaring gas prices not only crimp car purchases but drives an unprecedented shift in consumer demand from trucks to smaller fuel-efficient models." And just like GM's suits, Toyota's big boss tried to apply a coat of green gloss to the loss. "In his annual outlining of the company's business plan, Watanabe tried to sound an upbeat note by promising green vehicles. He said Toyota will speed up the delivery of a plug-in hybrid — which can be plugged into regular household electrical sockets — initially promised for sometime in 2010, to the end of 2009." Meanwhile, "It is forecasting its first full-year profit decline in seven years as it faces more problems from the weakening U.S. market."
Posted in News Blog | Sales | 2 comments
Euro Cars Top Lease List
By Frank WilliamsAugust 26, 2008 - 1,310 views
The Detroit automakers are trimming or eliminating their leasing programs due to plunging resale values and inflated residuals. In fact, in July leases accounted for only 19.7 percent of retail volume for the U.S. auto industry. However, leasing remains the way a lot of automakers use to put someone into an expensive car they really can't afford. And four of the most-commonly leased vehicles in the U.S. are BMWs (7 Series, Z4, 6 Series and X3). Bucking the current trend, sales and marketing VP at BMW Group Financial Services, Daniel DeChristopher, told BusinessWeek "we are still very committed to the leasing business." That's even though 70 percent of off-lease vehicles are returned to BMW Financial to be resold, usually as certified pre-owned cars. BMW is hedging its bet on leasing, though. They're also offering 0.9 percent APR loans during their "gotta unload these '08s before the '09s show up" sale. The top ten most commonly leased vehicles, and the percentage of them leased between January 1 and August 10 this year are:
BMW 7 Series - 85.3 percent
Saab 9-7x - 82.2 percent
Audi A6 - 74.1 percent
BMW Z4 - 70.7 percent
Mercedes E-class - 70 percent
Range Rover - 69.6 percent
BMW 6 Series - 68.6 percent
Audi A4/S4 - 68 percent
BMW X3 - 67.3 percent
Jaguar XJ - 65.8 percent
Posted in High Finance | Industry | News Blog | Sales | 21 comments
Ram Box Failing To Launch
By Edward NiedermeyerAugust 25, 2008 - 2,422 views
When Chrysler CEO Bob Nardelli was Chief Executive Despot at the Home Despot, he hung his monstrous paycheck on such gimmicky products as the Peter Arnell-inspired ergonomic fire extinguisher. now ensconced in Auburn Hills, Nardelli is banking on the RamBox storage option to move its all-new Ram in the teeth of a stiff anti-truck headwind. And that ain't working out so well. Despite Nardelli's and Co-President Jim Press's relentless "game changer" hype, the Ram Box is not good to go. Automotive News (sub) reports that Dodge has not priced the RamBox yet, but "dealers say they have heard discussions of an option price of $1,600 to $2,100." But the New Chrysler wants dealers to order the option without knowing what it will cost, a limb the dealers aren't eager to walk out on. "Until I've seen the RamBox and how it's priced, you're not going to be getting any orders from me," says one Dodge dealer. "I think the RamBox is going to be a big seller if it's priced reasonably. I don't want a bunch of trucks sitting on my lot without it. What the hell is the problem? Where's it at?" This is probably not the way Chrysler was hoping the RamBox would change the game. "We're trying to get a balance between volume and price," says Marc Seguin, senior manager for Ram marketing. "It's a tough thing to price. We're trying to understand how much volume we can sell." Meanwhile, the dealers are left fuming. "To launch the truck without the RamBox is just ridiculous," says another unhappy pusher-man.
Posted in Marketing | News Blog | Sales | 34 comments
Lincoln-Mercury Dealers Facing Extinction
By Frank WilliamsAugust 25, 2008 - 2,353 views
Ford says it's not killing Mercury but their actions indicate otherwise. In the past two years, The Blue Oval Boyz have cut their ranks by 400 dealers, mainly by merging the three brands under one roof in many areas. Automotive News [sub] reports that starting this week, Ford execs will tell the remaining stand-alone Lincoln-Mercury dealers their latest and greatest consolidation plan for rolling them into Ford dealerships. The dealers aren't overly pleased with the prospects, but they see the handwriting on the wall. While Ford says they stand behind the Mercury brand and will give it a new small car, "one Ford insider told Automotive News that company executives want to make it clear to dealers that no major influx of new product is coming for Mercury." Once the dealer consolidation is done, you can just about bet that the Mercury brand will be starved for product, with all of the new models going to Ford or Lincoln. Then it's just a matter of time before Mercury just fades away like DeSoto in the early 60s.
Posted in Branding | Dealer News | Marketing | News Blog | Sales | 22 comments
GM Employee Pricing Returns
By Robert FaragoAugust 18, 2008 - 5,543 views
One more time! Maybe even literally. Strangely, GM's told its dealers that revealing the imminent arrival of "employee pricing for all" to the outside world would be a felony. So I guess you can call me Miss Demeanor (you know; if I wasn't a Silverado-loving man's man). Anyway, it's all over the damn web. Reuters reports [here and via Automotive News] that "the offer starts Wednesday, runs until Sept. 2 and applies to all 2008 model year Chevrolet vehicles, according to the dealer, who was not authorized to discuss the GM plan." See? The black ops are only a beat behind. So to speak. And if employee pricing isn't enough to pull in the punters, "the top-selling U.S. automaker will offer cash back on slower-selling light trucks, including the Silverado pickup, said the dealer, who had just been briefed by GM." Top selling? Slower-selling? Careful you don't hurt yourself pulling those punches. Anway, we now have confirmation that ALL GM brands are involved in the fire sale. Oh, and try and guess the Money Factor in a standard GM lease these days. It's 16 percent. Which will apply to the new Malibu on Wednesday.
Posted in Chapter 11 | Marketing | Media | News Blog | Sales | 43 comments
Bling Bang Boom!
By Edward NiedermeyerAugust 14, 2008 - 1,627 views
Auto Motor und Sport reports supercar sales jumped 45 percent between 2002 and 2007, to a record 165k units per year. The German buff book details a study by the Instituts für Automobilwirtschaft (IFA) at the Hochschule für Wirtschaft und Umwelt (HfWU) in Nürtingen-Geislingen. It estimates supercar sales will increase by another 20 percent to 200k units by 2015. The IFA says much of this growth will be driven by newly wealthy criminals and dictators status-seekers in emerging economies like Russia and China. It also credits (blames?) "the spiral of exclusivity." "Many premium manufacturers have lost exclusivity by widening their model ranges. The small-volume firms can offer the exclusivity that is so important for supercar buyers." So although the horsepower wars of the 1990s may have reached their zenith with the 1001 hp Veyron, we can expect a steady stream of four-wheeled unobtainium– with carbon tax surcharges greater than the GNP of Belize.
Posted in Industry | News Blog | Sales | 12 comments
The Fleet’s In!
By Frank WilliamsAugust 14, 2008 - 1,779 views
Automotive Fleet has published their mid-year report of fleet sales, and there are a few surprises to be found. The Crown Vic's place at the top of the list (94.2 percent of sales to fleets) is not one of them. Nor will anyone gasp at the Sebring's (69.9 percent of convertibles and 62.2 percent of sedans) and Avenger's (65.5 percent) rankings. However, the stats show that 56.6 percent of Dodge Calibers went to fleets, as did 49.9 percent of Chevy Impalas. The highest import nameplate: the Mazda6 (59.5 percent) followed by the Suzuki XL7 (53.2 percent) and, believe it or not, the Volvo S40 (48.9 percent). Brands you'd think were naturals for fleets like Hyundai and Kia placed below the 50 percent level. Overall, 21.8 percent of the cars and 20.8 percent of the trucks sold the first half of this year went to fleets. As overall sales drop and inventory builds up, that number will probably grow for the second half. We'll offer a more detailed analysis of fleet sales soon. [Thanks to NoSubstitute for the link]
Posted in Industry | News Blog | Sales | 28 comments
Toyota Predicts U.S. Pickup Market Will Tank by 32.2% in ‘08
By Robert FaragoAugust 13, 2008 - 1,124 views
Automotive News [AN, sub] brings news from the Traverse City auto-exec seminary. Only their headline news is not the real news. AN proclaims "Toyota exec says pickup market will recover." And indeed Robert Carter does just that, in a distinctly vague, Detroit-like way. "We are absolutely confident that the recovery will take place," the GM of ToMoCo USA says, confidently. "It's just arguable when." But the real money shot (or, in this case, not) arrives in Carter's set-up. Before pushing Pollyanna on stage, Carter said he "expects full-size pickup truck sales to total 1.45 million in 2008 — a significant drop from last year's sales of 2.14 million units." Significant is just a word (as is "word"). As for that eventual, arguably-timed pickup pickup, Carter's "not sure what will happen to what he calls the 'recreational user' of pickup trucks — the weekend warrior who uses his pickup to tow a boat or pickup a grill at Home Depot." Uh, if that "non-core" but still sizable demographic doesn't return, what kind of recovery is he talking about? Semi, demi or quasi? Make mine non-fat.
Posted in News Blog | Sales | 14 comments
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