By Joe Benton
ConsumerAffairs.com
September 1, 2006
Weighed down by heavy inventories of unsold cars and trucks, General Motors, Ford and Chrysler are all offering ho-hum sales incentives and the Labor Day weekend is likely to be a car sales dud for all of them.
The automakers reported gloomy sales figures as the weekend bgan. GM posted 3.9% rise in U.S. auto sales for August and said fourth-quarter output would fall 12% from a year earlier. Ford reported a 12% drop in U.S. auto sales, the latest in a string of declines. Chrysler's sales also fell, while Toyota posted a double-digit rise.
Chrysler plans to offer 0% financing for 72 months on its 2006 models. Chrysler, Dodge and Jeep dealers don't think the promotion will help them sell much of anything because the new loan incentive available through September will be offered only to people with nearly perfect credit.
Over at Ford, the deal is a little sweeter, but not a whole bunch. Ford is also offering 0% financing for six years on its remaining 2006 vehicles but Ford is making the free financing available to people with less than perfect credit.
Zero percent financing isn't the lure it once was and Chrysler dealers around the country are bemoaning the latest incentive program.
Chrysler needs to give the free financing to credit-challenged consumers if they're going to reduce inventories of the Dodge Ram pickup, Dodge Durango SUV and Chrysler and Dodge minivans, according to dealers.
Chrysler is ending its employee-discounts-for-all-buyers promotion, which has failed to do much for summer sales.
GM efforts to sell cars and trucks over the Labor Day weekend include a zero-interest loan deal on 2006 and 2007 vehicles with additional cash $500 to $1,500 on many vehicles. GM's program ends after the Labor Day weekend.
U.S. automakers have tried to reduce incentive spending but the zero-percent financing may be necessary given the tough sales environment and the program doesn't require as much out-of-pocket spending.
While domestic automakers struggle to attract customers, Toyota dealers simply open their doors and wait for the customers to arrive. On average, Toyota dealers have only 10-day supply of the redesigned 2007 Camry which is headed toward a record breaking sales year.
The 2007 redesign of the Camry produced more attractive styling, more interior room and more power. A hybrid version of the Camry is also now available.
The Toyota assembly plant in Georgetown, Kentucky is running overtime and weekend shifts turning out the Camry which remains the best selling car in the country, an unofficial title the Camry has held every year but one since 1997.
There are no sales incentives attached to the Camry.
"Customers are following the car carriers to the dealership," according to one Toyota dealer.
