Itsme
01-10-2006, 10:41 AM
GM Plans to Trim Prices on Most Vehicles
By DEE-ANN DURBIN, AP Auto Writer
DETROIT - General Motors Corp., which has been losing market share in the United States to Asian automakers, said Tuesday that it will lower the prices on 57 of its 76 models in North America in an effort to boost its sliding market share and wean buyers off expensive incentives.
Mark LaNeve, vice president of sales and marketing for the world's biggest automaker, told reporters that the program will lower the manufacturer's suggested retail price by as much as $2,500 on some vehicles, but the average decrease will be $1,300.
"We want it to be crystal clear that with or without incentives you're getting a great price," said LaNeve, who planned to announce the deal later Tuesday at the North American International Auto Show.
GM will lower prices on all Chevrolet, Buick and GMC vehicles and most Pontiac vehicles starting Wednesday, LaNeve said. Saab, Saturn and Hummer will be excluded because GM feels they are already priced appropriately, he said.
LaNeve said GM believes it will make money despite the markdowns because it has new products coming to market, and it will be spending less per vehicle on incentives, which have sometimes topped $4,000 per vehicle.
"Bottom line, we think this is the right thing to do for our business," LaNeve said. GM's sales dropped 5 percent in 2005 despite popular employee-pricing discounts last summer.
GM shares edged up a penny to $22.57 in midday trading on the New York Stock Exchange.
Under the new pricing plan, a 2007 Chevrolet Tahoe will have an MSRP of $33,990 for a model with a 5.8-liter, V-8 engine. That is $2,000 below the 2006 Chevrolet Tahoe even though the new Tahoe offers better fuel economy, Chevrolet General Manager Ed Peper said.
GM said the new pricing will make it easier for consumers to compare GM vehicles with their competitors on the Internet, where two-thirds of car shoppers are now doing research. High incentive spending had made it more difficult for consumers to figure out the price of a vehicle.
Peper said the 2007 Chevrolet Impala LS will sell for $20,990, or $1,000 less than the previous model. A comparable Toyota Camry sells for $23,320, while a comparable Honda Accord sells for $25,650, Peper said.
GM has been struggling for years to overcome negative perceptions about the quality of its vehicles. LaNeve said the company will be introducing aggressive new ads that invite buyers to compare their vehicles to any others on the market.
GM also has struggled trying to get away from expensive incentives that it launched after the Sept. 11 attacks. Incentives like last summer's employee-discount plan have led to big short-term sales gains, but they have hurt the company's image because they can cheapen the brand image and hurt resale values.
LaNeve said incentives won't go away entirely, but the company plans to use them sparingly.
"That's just part of the automotive landscape," LaNeve said.
By DEE-ANN DURBIN, AP Auto Writer
DETROIT - General Motors Corp., which has been losing market share in the United States to Asian automakers, said Tuesday that it will lower the prices on 57 of its 76 models in North America in an effort to boost its sliding market share and wean buyers off expensive incentives.
Mark LaNeve, vice president of sales and marketing for the world's biggest automaker, told reporters that the program will lower the manufacturer's suggested retail price by as much as $2,500 on some vehicles, but the average decrease will be $1,300.
"We want it to be crystal clear that with or without incentives you're getting a great price," said LaNeve, who planned to announce the deal later Tuesday at the North American International Auto Show.
GM will lower prices on all Chevrolet, Buick and GMC vehicles and most Pontiac vehicles starting Wednesday, LaNeve said. Saab, Saturn and Hummer will be excluded because GM feels they are already priced appropriately, he said.
LaNeve said GM believes it will make money despite the markdowns because it has new products coming to market, and it will be spending less per vehicle on incentives, which have sometimes topped $4,000 per vehicle.
"Bottom line, we think this is the right thing to do for our business," LaNeve said. GM's sales dropped 5 percent in 2005 despite popular employee-pricing discounts last summer.
GM shares edged up a penny to $22.57 in midday trading on the New York Stock Exchange.
Under the new pricing plan, a 2007 Chevrolet Tahoe will have an MSRP of $33,990 for a model with a 5.8-liter, V-8 engine. That is $2,000 below the 2006 Chevrolet Tahoe even though the new Tahoe offers better fuel economy, Chevrolet General Manager Ed Peper said.
GM said the new pricing will make it easier for consumers to compare GM vehicles with their competitors on the Internet, where two-thirds of car shoppers are now doing research. High incentive spending had made it more difficult for consumers to figure out the price of a vehicle.
Peper said the 2007 Chevrolet Impala LS will sell for $20,990, or $1,000 less than the previous model. A comparable Toyota Camry sells for $23,320, while a comparable Honda Accord sells for $25,650, Peper said.
GM has been struggling for years to overcome negative perceptions about the quality of its vehicles. LaNeve said the company will be introducing aggressive new ads that invite buyers to compare their vehicles to any others on the market.
GM also has struggled trying to get away from expensive incentives that it launched after the Sept. 11 attacks. Incentives like last summer's employee-discount plan have led to big short-term sales gains, but they have hurt the company's image because they can cheapen the brand image and hurt resale values.
LaNeve said incentives won't go away entirely, but the company plans to use them sparingly.
"That's just part of the automotive landscape," LaNeve said.