Detroit Incentives Hit $4k
Detroit is spending a whopping $4011 in incentives per vehicle sold in July on average, according to Edmunds's True Cost of Incentives report. That figure remains significantly higher than the record industry average $2885 per vehicle. GM remains the biggest spender of the Big Three and the industry as a whole, increasing its pay out for the fourth straight month to $4467 — a figure that has them spending $800 more than Ford ($3686), which had the biggest monthly increase in spending ($358), and well over $1000 more than Chrysler ($3384) The automaker kicked off August with a fresh round of incentives, with its uppermost rebate now reaching $5000. While many continue to criticize the General's cutthroat incentives, the automaker is gaining market share, up 3.4 percent in July, while Ford and Chrysler have fallen 1.3 percent and 2.3 percent respectively, Edmunds says.
While the Big Three spend, spend, spend, most of their counterparts are doing their job to keep incentive levels moderate. Korean automakers Kia and Hyundai are the only firms able to actually deflate spending, despite July being a traditionally competitive month when most automakers are moving out 2004 models to make room for 2005. The Koreans reduced incentives $35 to $1833, while Europeans boosted spending $228 to $2562. The Japanese remain the most frugal, spending just a shade above $1000 in incentives per vehicles, Edmunds says. Luxury nameplates Cadillac ($7878), Lincoln ($5480), and Jaguar ($5248) are the most liberal spending of brands in the U.S. market, while specialty players MINI ($80), Scion ($212), and Porsche ($257) dish out the least. —Jack Gilbert
July Sales Rebound; Ford, GM Down by Joseph Szczesny (8/3/2004)
Chrysler and Japan's Big Three have a month to remember.
Chrysler Issues Pair of Recalls
A power steering problem has driven Chrysler to call back 681,000 V-6 minivans sold between the 2002 and 2004 model years. Power steering hoses potentially could leak in chilly weather, leading to fires. In addition, 2000 Dodge Ram pickups are recalled for wiring problems.
C6 Ads to Invade Olympics
Television commercials for the Chevy's C6 'Vette debut during the Summer Olympics. GM turned to Guy Ritchie, best known for his highly-publicize fling with Madonna, but also known for his short movie-directing talent — including BMW commercials staring The Material Girl — to call the shots on the new TV spots. Created by longtime Chevrolet ad shop Campbell-Ewald in Warren
, the ads are set to the tune of the Rolling Stones' "Jumping Jack Flash," and retell the daydream of a boy who imagines himself racing through the streets of New York
in nothing less than America
's most storied sports car. —Jack Gilbert
2005 Chevrolet Corvette by TCC Team (8/2/2004)
With the "C6," the little changes make a big difference
GM Wins ChinaFinancing Approval
Like crosstown rival Ford, General Motors now has permission to finance vehicles in China through its captive-finance arm. General Motors Acceptance Corp. has partnered with Shanghai Automotive Group Finance Co. Ltd., and together, the two will begin to sell Chinese consumers vehicles on credit. General Motors will actually beat Ford to the punch in China with its financing; Ford has received initial approval for its Ford Credit branch to operate in China, while GM's deal with its Chinese partner is final approval. GMAC will own 60 percent of its venture and will fund it to the tune of $60 million.
SPECIAL REPORT: Management Briefing Seminars
2004 Traverse City Coverage (8/3/2004)
Automakers face "the perfect storm."
2004 Traverse City Coverage, Part II by TCC Team (8/4/2004)
Toyota plans new proving grounds, no new brands from Chrysler.
Saturn VUE in Big Recall
Nearly 250,000 of Saturn's VUE SUVs will be recalled to fix a suspension problem that could cause a rollover if a driver makes an emergency maneuver. The defect was discovered during tests by the National Highway Traffic Safety Administration. The sport-utility vehicle's rear suspension failed during two separate rollover tests. The vehicles were put through maneuvers in which they were subject to sharp turns at 45 mph. In both cases, a wheel collapsed. Following a speech to the Management Briefing Seminars, General Motors Corp.'s Chief Financial Officer, John Devine, said owners will be asked to return their vehicles to dealers to have the rear suspensions modified. A total of 246,433 Saturn utes are involved. Devine said he did not know how much the recall would cost the automaker, but stressed that "Rather than talk about it, we'd rather fix it." It's not the first problem for Saturn's first sport-ute, which was launched in 2002. The automaker was forced to drop a fuel-efficient continuously variable transmission, or CVT, when it failed to meet durability requirements.