GM May Extend Employee Discount Offer

[Marc]

GM may keep its Employee Discount offer in effect past
July 5, the original cut off date.....................................


GENERAL MOTORS: Discounts may be extended

Bloomberg News
Published June 25, 2005


DETROIT -- General Motors Corp., seeking to reverse a decline in U.S. sales and market share, may extend past July 5 an offer of employee discounts for all U.S. buyers, marketing chief Mark LaNeve said Friday.

"We will make a decision somewhere over the 4th of July weekend," said LaNeve, group vice president of North American sales and marketing. "We're considering it, but we're also considering something else."

Some GM dealers say the expanded employee-discount program, which began June 1, has increased their June sales from 20 percent to 50 percent, partly because they're selling more vehicles to customers trading in competitors' cars and trucks.

June sales for GM will rise 26 percent from a year ago, according to Edmunds.com.

GM began offering all buyers the same discounts it gives to employees after a 6.7 percent decline in sales through May. The company's U.S. market share dropped to 25.7 percent from 27.2 percent in the same period.

LaNeve declined to project the impact of the discount program on June sales.


www.chicagotribune.com/business/chi-0506250041jun25,1,5769165.story?coll=chi-business-hed

[auroralover]

If they still made Auroras, I'd probably buy a new one......

[oldsauroraman1]

You bet Auroralover! That's exactly what I thought. Even a nice Oldsmobile of any model! You can keep the others!

[Letitroll98]

It's the razor blade and the razor marketing strategy, a Marketing 101 fav. Give away the razor any way you can, just get it into the hands of the consumer at any price. The sell razor blades at a profit. GM puts cars into the hands of consumers at any price and then makes money with GMAC. Holding on to market share at any cost is a commodity policy. Building a better product for less while maintaining profit margins and letting the market share find it's own natural level is something the Japanese do, the fools.

[oldsauroraman1]

No way. The Japs are building cars that need to be fixed as much or more than ours. Their parts are more expensive too. Even when some are built here in the US. Remember, buying foreign will and does support the economy of another country in the end. And, there's NO WAY I'd want those Mitsubishi RED propellers around my house(That's the official symbol of the Mitsubishi). Those are the folks who enslaved American troops, illegally, to build airplanes to attack us with in WWII. No reparations ever paid to our boys for that! Yeah, I know they are not THE actual people that did it, but AMERICA is first here.

[auroralover]

I thought I heard yesterday that Ford is going to match GM's offer of employee discount pricing. Don't know the details;did anyone else hear this? If it's true I bet it doesn't apply to the new Mustangs. Ford has told its dealers to quit taking orders until they can get caught up with current orders.

[Letitroll98]

oldsauroraman1 said:

No way. The Japs are building cars that need to be fixed as much or more than ours. Their parts are more expensive too. Even when some are built here in the US.

Intellichoice lists the lowest cost cars to own over the last five years in each of 17 classes. 13 were Japanese brands, two were German, and two were Chevies. In the same classes for highest retained value, 8 were Japanese, 4 were German, 5 were American brands. IntelliChoice’s Best Overall Value of the Year awards for 2005 lists eight category winners, 7 are Japanese brands, one is a Chevy truck. I'm at a loss to see how Japanese cars are more expensive to own than American or European makes.

Although I love my Aurora, I recognize that their will be a higher incidence of repair. I have owned several Japanese and German made cars and they have all proved more reliable than any American brand I have ever owned. So I will be expecting a subsity check from my goverment for the extra cost of maintaining an American branded car?

In WWII the Mitsubishi A6M Zero (JNAF) and the Nakajima Ki-43 Oscar, a lighter variant for the Army, were soon outpaced by the Vought F4U Corsair and the Grumman F6F Hellcat for the Navy; and the Republic P-47 Thunderbolt and North American P-51 Mustang for the Army. (Although the old Curtiss P-40 Warhawk was used to great effect by Claire Lee Chennault's American Volunteer Group, popularly known as "The Flying Tigers") Anyway, American manufacturing know-how easily bested the Japanese when it counted, why can't they do it now? I would suggest American workers and management take a long, deep look inside themselves for the answer.

[Aurora40]

letitroll98 said:

Intellichoice lists the lowest cost cars to own over the last five years in each of 17 classes. 13 were Japanese brands, two were German, and two were Chevies. In the same classes for highest retained value, 8 were Japanese, 4 were German, 5 were American brands. IntelliChoice’s Best Overall Value of the Year awards for 2005 lists eight category winners, 7 are Japanese brands, one is a Chevy truck. I'm at a loss to see how Japanese cars are more expensive to own than American or European makes.

If a car has the highest retained value, then it should be pretty easy for that car to be the cheapest to own. Retained value or depreciation is the biggest factor in cost-to-own. Gas is probably the biggest actual cost, though maybe not. But the relative differences in gas cost aren't huge. And over a short term, the relative differences in maintenance and repairs shouldn't be huge either.

So a foreign car could be as reliable (or less) and cost more to maintain and fix, but still be cheaper to own because it depreciates less. This, at least in my opinion, is one of the bigger problems with American cars.

I believe it will take perceptions about brands to change before this reverses. The fact that American cars routinely get bashed in the media for their "reputation" doesn't help. How many people feel any Honda is probably more reliable than any Buick? But when you talk about specific cars, how likely is that to actually be true? If you read pretty much any car magazine, and they compared a brand new Infiniti to a brand new Cadillac, what do you think their comments about future reliability would be?

[oldsauroraman1]

Those expensive parts will eat up ANY savings you may possibly obtain in using a little less gas.

[Aurora40]

Well, in reality, GM leads in fuel economy in a lot of categories. But the depreciation differences are huge between a Honda and a Pontiac for example. You can't overcome that even with zero mechanical problems and 50 mpg economy over a short term (a couple years). Domestics need better resale to compete in "cost-to-own" studies.

Of course, those "cost-to-own" studies are only ever for a short term and never take into account people who buy a car and drive it until it dies. Nor people who buy it used after a short term. If the car hasn't depreciated much in 3 years, then as a used car buyer, you have a lot of depreciation possible after you buy it.

But anyway...

[oldsauroraman1]

Well, there is one more important issue. Those Hondas are small and there's no way I am going down the road in one! S-A-F-E-T-Y

I've been through their plant in Marysville, nice, but still Jap junk. And that plant is run by the Japanese and the profits go back to Japan. No way.

[oldsauroraman1]

Anyhow, back to our topic . . . Ford and Chrysler have now both jumped on the bandwagon and are offering the employee discount on their vehicles to everyone else.

[erw38]

GM is extending it until the end of August.

[oldsauroraman1]

Yes they are and boy would I really love to buy a NEW Oldsmobile right now! ;D

[erw38]

I saw a Chevy commercial that said it ends August 1^st.

[oldsauroraman1]

Yes that is correct. It ends August 1st as do Ford and Chrysler. Here's the link to the GM Web Page: www.gm.com/


"GM Employee Discount for Everyone Event

From now until August 1, 2005, enjoy the GM Employee Discount on almost all 2005 GM vehicles across all divisions.* For the first time in history, everyone in America gets the GM Employee Discount.

It's a great price. You pay what we pay. Not a cent more. At participating dealers only."

[Letitroll98]

aurora40 said:

Of course, those "cost-to-own" studies are only ever for a short term and never take into account people who buy a car and drive it until it dies.

The study was for five years.

aurora40 said:

If a car has the highest retained value, then it should be pretty easy for that car to be the cheapest to own.

A bit too clever an argument dear sir, they are separate categories i.e. the cost to own doesn't include resale value.

And basically you can check just about any data base, I just happened to pull a couple of things from Intellichoice. (And Intellichoice has a lot of other data bases as well.) American cars get a win in class here and there, and many get in on top ten lists in class, but back on topic, the point here is that US makers still have to offer giant incentives to sell cars. You can rail all you want to, but the American public has voted with their pocketbook for the higher quality product. And that's without Toyota giving away cars. It's all about the product boys.

[Aurora40]

letitroll98 said:

A bit too clever an argument dear sir, they are separate categories i.e. the cost to own doesn't include resale value.

I'll have to take a look at that site, I guess. Typically "cost-to-own" studies do account for depreciation, as that is a cost if you only plan on owning it for a certain period of time.

[oldsauroraman1]

Gentlemen:

Are we off on a rabbit trail here?