Car Chat General discussion about Lexus, other auto manufacturers and automotive news.

This summer, GM says it won't get 'desperate' for sales

Thread Tools
 
Search this Thread
 
Old 05-26-06, 08:31 AM
  #1  
GFerg
Speaks French in Russian

Thread Starter
 
GFerg's Avatar
 
Join Date: Oct 2002
Location: What is G?
Posts: 13,250
Received 58 Likes on 45 Posts
Default This summer, GM says it won't get 'desperate' for sales

Toughing it Out
This summer, GM says it won't get 'desperate' for sales

By JAMIE LAREAU | AUTOMOTIVE NEWS
AutoWeek | Published 05/23/06, 2:33 pm et



DETROIT -- General Motors executives are determined not to become "desperate men" doing "desperate things" this summer to move metal.

The automaker plans to hold to its strategy of lower sticker prices that are closer to the actual transaction prices. It will not rely on big summer blowout programs to boost market share and support sales, say GM's Robert Lutz and Mark LaNeve. Lutz is vice chairman and vice president of global product development. LaNeve is vice president of vehicle sales, service and marketing.

GM doesn't want to repeat last summer's experience, when the employee-pricing incentive spurred massive sales -- followed by a brutal payback of slow fall sales.

"We're not looking to do a big GM incentive program but want to go to market by brand on the strength of the products," LaNeve said in an E-mail.

GM will continue to be competitive in leasing, loyalty and conquest programs, LaNeve said. He added, "We will not let competition run away from us on aggressive merchandising during the summer sell-down."

In a recent interview with Automotive News, Lutz characterized a big blowout incentive sale as "the old 'desperate men do desperate things.'"

"We really want to tough it out," he said.

Lutz said North American executives are "absolutely determined to do whatever it takes" to make GM's resale values healthy. That means not relying on incentive blowout sales or daily rental-fleet sales to prop up market share.

"Anytime we pull all those triggers, we could probably have a 32 percent market-share month," Lutz said. "But nobody wants it anymore because we know the long-term damage it does.

"So many people -- before they buy a car -- they go to sites like Edmunds.com, and they look at the cost of ownership. If they see a GM or any domestic brand that's priced $1,000 under the Camry but, guess what, the first two years you lose $3,000 (in residual value), the guy doesn't have to be very good at math to realize he's better off paying the extra $1,000.

"The only way to solve that is to stop performing unnatural acts in the market. We just have to be patient."
http://www.autoweek.com/apps/pbcs.dl...1/TOC01ARCHIVE
GFerg is offline  
Old 05-26-06, 09:18 AM
  #2  
SoCalSC4
Lexus Champion
 
SoCalSC4's Avatar
 
Join Date: Feb 2002
Location: Cali
Posts: 4,466
Received 13 Likes on 9 Posts
Default

Maybe they mean they're not going to get MORE desperate?
SoCalSC4 is offline  
Old 05-26-06, 09:43 AM
  #3  
sha4000
Lexus Test Driver
iTrader: (1)
 
sha4000's Avatar
 
Join Date: Aug 2005
Location: N.Y.
Posts: 6,853
Received 334 Likes on 288 Posts
Default

sounds right, they might be on to something
sha4000 is offline  
Old 05-26-06, 12:03 PM
  #4  
Lexmex
Super Moderator
 
Lexmex's Avatar
 
Join Date: Apr 2004
Location: Miami, Florida
Posts: 17,240
Received 161 Likes on 137 Posts
Default

If I were GM execs (especially Lutz), I would keep my mouth closed. When people panic, they tend to open their mouth a lot.
Lexmex is offline  
Old 05-26-06, 01:56 PM
  #5  
akhbhaat
Rookie
 
akhbhaat's Avatar
 
Join Date: Feb 2006
Location: Europe/US
Posts: 83
Likes: 0
Received 0 Likes on 0 Posts
Default

GM has nobody to blame but GM for this hole.
akhbhaat is offline  
Old 05-26-06, 08:08 PM
  #6  
LexLaw
Lexus Champion
 
LexLaw's Avatar
 
Join Date: Feb 2005
Location: NYC Raised But ATL is where I stay.
Posts: 1,809
Likes: 0
Received 0 Likes on 0 Posts
Default

How could you not enjoy this?? GM is really serious aren't they?
LexLaw is offline  
Old 05-26-06, 08:16 PM
  #7  
1loudLX
Lexus Champion
 
1loudLX's Avatar
 
Join Date: Dec 2005
Location: now here
Posts: 2,732
Likes: 0
Received 1 Like on 1 Post
Default

damn amercian car company, lol. Really they should be quite about what they are thinking because i dont see how a press release like this could help. It kind of makes me think, wow these guys cars suck so much they cant make anything off them. Meanwhile a high end luxury company can jack up their price and still get people to buy them because they are good quality and people want them.
1loudLX is offline  
Old 05-27-06, 01:55 PM
  #8  
LexFather
Guest
 
Posts: n/a
Default

Originally Posted by SoCalSC4
Maybe they mean they're not going to get MORE desperate?
lol, that is what I was thinking
 
Old 05-27-06, 07:08 PM
  #9  
-J-P-L-
Lexus Fanatic
 
-J-P-L-'s Avatar
 
Join Date: May 2003
Location: Massachusetts
Posts: 7,864
Likes: 0
Received 0 Likes on 0 Posts
Default

Their high paid Exec's couldn't predict the long term effects of their "employee pricing" and other crazy offers? Unbelievable. I can't beleive they had to find out the hard way. I bet anyone of us on this forum could run GM better than it is right now.
-J-P-L- is offline  
Old 05-30-06, 04:52 PM
  #10  
Iceman
Lexus Champion
 
Iceman's Avatar
 
Join Date: Jul 2001
Location: Redondo Beach, CA
Posts: 2,212
Likes: 0
Received 0 Likes on 0 Posts
Default

I agree with those who wonder what the point of a press release like this could be. One thing that comes to my Machiavellian mind is that Lutz is publicly asking Ford and D-C to start the crazy incentive war this time so GM won't have to. They even put that statement in that they'll be "competitive when it comes to incentives" meaning they'll match whatever the other guys do. That way they can just shrug their shoulders and claim that THEY'RE not the ones who are desperate, but they simply have to keep up with the incentives to be competitive, blah blah blah...
Iceman is offline  
Related Topics
Thread
Thread Starter
Forum
Replies
Last Post
LexFather
Car Chat
34
04-19-13 02:52 PM
LexFather
Car Chat
4
10-13-09 12:08 AM
LexFather
Car Chat
63
11-08-05 05:09 AM



Quick Reply: This summer, GM says it won't get 'desperate' for sales



All times are GMT -7. The time now is 08:56 PM.