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Besides, what is GMs selling point? Quality? Style? Performance? Please.
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Well, GM and Ford have OWNED the large SUV and full-size truck markets. They still do, and will for the short term. The Tundra and Titan (and SUV's based on them) will make only a small dent.
However, those segments are sinking like boulders, while small cars are super hot. GM has no hot small cars, and they haven't for a long time. GM has been too busy focusing on their bread and butter: trucks.
GMs quality has been getting better and better, but their reputation still suffers. Style is subjective, but there are some GM designs I rather like. Performance may be relative, but I don't think they are at a disadvantage in the marketplace.
I personally believe that the SUV craze is coming to an end. Cars, and wagons, are cool again. The smaller crossover utes fill what most people need out of an SUV. Most SUV's were bought by people who really didn't NEED one that big. They're readjusting now. Fuel prices may have been the catalyst, but the natural cycle was coming anyway.
As for GM's new 'Employee Pricing' campaign.... it's not going to be that big a deal. Almost no one pays sticker anyway, most pay near invoice. The difference from invoice to GMS (employee pricing) is about 4.5%.
Example: 2005 Suburban LT (loaded)
$50760 MSRP
$45143 Invoice
$42972 GMS
If you were good, and paid invoice before and took the $4500 rebate that was out there in May, you would have paid $40643.
Now, you don't have to negotiate, pay GMS $42972 less $3000 rebate and net $39972.
It's a better deal by $671 and you don't have to negotiate. Big deal? On a $50K Sub, maybe.
Now take a 2005 Chev Malibu LS:
$22005 MSRP
$20505 Invoice
$19618 GMS
There was a $2500 rebate, now it's $2000. So you're $387 ahead.
I think the only traction the program will get is because you don't have to negotiate to see the real transaction price. Compare to a Honda/Toyota where the real transaction price may be MSRP, it will look very attractive.
Dealers will be pissed because they are the ones settling on a set margin (GM pays the dealer x% of invoice for profit). Dealers will also be pissed that GM just took all their leverage away to get rid of distressed inventory. That ugly pink one is the exact same $$ as the hot gray one. The hotter inventory may fly off, but the pooch inventory will still sit.
GM will suffer for a few years. GMAC looks robust, but if Mr. K spins it off, it will die without the porfolio strength and depth of all those captive new-car sales. It was just accounting.... do you credit the front end (sales) or the back end (finance). GM felt it was better to give it to GMAC. The subvention for all that 0% was just charged like a cash incentive would have. GMAC still 'saw' market rates on their books. GM's car division paid for the difference.
Sorry for the ramble....
E