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Just thought I would inject a short reality check here - the Sienna has no national rebates or incentives, and is edging past Odyssey to become the number two minivan in sales after the Caravan. The Tacomas sell with no rebates except $750 on double cabs, and have become the number one midsize truck in sales. They have never needed much help to sell.
The Tundra has cash on the hood to sell the last of the outgoing model, the new model arrives this month. The Highlander has cash on the hood to sell the last of the outgoing model as the new one arrives this spring. Except for the Tundra, the cash incentives Toyota is offering here absolutely PALE by comparison with the traditional cash incentives from GM (historically), and the CURRENT incentives from Ford.
Meanwhile, Camry sold at the rate of 448,000 in 2006 without ever having ANY cash incentive during the entire year. Corolla, with the current model having been on the market for five full years already, outsold all other cars except Camry in the American market, with a cash rebate only in the slow winter months, and then only a paltry $500.
It is a bit harsh to say Toyota would not be increasing sales were it not for the use of cash incentives.
I absolutely congratulate GM on sticking to the toughest part of their plan, and the most important perhaps: killing the cash incentives and rental fleet sales. This will do wonders for their business in the long run. The next step for them, now that they have the ball rolling, is figuring out how to solve the problem of the swollen, oversized dealer body. Lots of those folks are going to have to close as GM's retail sales stabilize at a rate 20% below even a few years ago. I understand the NADA dealer convention is this weekend in Las Vegas, where I am sure the dealers will be clamoring for answers from GM on exactly what will happen with respect to that issue.
2014 Mini Cooper (stick shift of course), 2016 Camry hybrid, 2009 Outback Sport 5-spd (keeping the stick alive)
Amy Wilson | | Automotive News / February 2, 2007 - 10:56 pm
General Motors trimmed 87 dealerships from its U.S. count last year, a reduction of 1.2 percent. Though it still has too many dealerships, GM doesn't plan buyouts to reduce stores at a faster pace.
"We don't have a lot of cash to invest in that," GM North America President Troy Clarke said yesterday at the J.D. Power Automotive Roundtable. He referenced the closeout of the Oldsmobile dealer network, saying, "GM is a company who knows what that costs."
GM's cash is better spent on new product investments, Clarke said. It will handle its dealership reduction in part by encouraging dealers to work out consolidation deals among themselves. GM will try to facilitate agreements when possible but "won't take a real heavy hand with that," he said.
Clarke described the matter of reducing dealership numbers as one of "extreme problem solving." GM won't specify targets or mandates because there's no upside, he said.
GM ended 2006 with 7,036 dealerships across all eight of its brands, a company spokeswoman said yesterday. That compares with 7,123 at the end of 2005.
Asked when GM would get more aggressive on dealership consolidation, Clarke replied: "I don't know. But it's not tomorrow."
A Wall Street investor says the Detroit 3 need to eliminate 60 to 70 percent of their U.S. dealerships to compete effectively with Japanese rivals.
What's more, the investor might want to put his money into helping make that happen.
"If we could take five dealers in an urban area and chop it to three, does that make throughput go up?" said Stephen Girsky, president of Centerbridge Industrial Partners LLC.
"That's simple math -- doesn't it make sense?"
Centerbridge, formed last year, controls $3.2 billion and specializes in automotive investments. Girsky spoke here yesterday at the J.D. Power Automotive Roundtable.
"All things being equal," Girsky said, "we need to reduce the number of Big 3 dealerships by 60 to 70 percent to give them the throughput of a Japanese make. Honda and Toyota (dealerships) are selling two to three times what the average (Detroit 3) dealer is selling."
The average U.S. Honda Division dealership sold 1,238 cars and trucks in 2005, while the average Ford division dealership sold 696 vehicles. Figures are not available for 2006.
The Detroit 3 are acutely aware that they have more dealers than they need, especially in some older urban markets. Each of the U.S. companies has proposed cutting its retail network.
But Girsky said the Detroit 3's current rate of dealership reduction -- 4 to 5 percent a year -- will take too long to make their brands competitive in per-store sales.
After his presentation, Girsky said his company would consider investing in retail operations but has not discussed any deals.
"Buying one or two dealers -- that's too small for us," he said. "You need critical mass."
Girsky said factors that would influence any decision to invest include dealership real estate. He added : "Some of these dealers are sitting on real estate where the best use might not be a dealership anymore."
2007 models
Lexus ES, GS, GX, IS,
LS, LX, RX, SC – 6.29%
Toyota Sequoia $0-$2,000 1.9-3.9%
4Runner $0-$1,500 0-4.9%
Highlander (excl. Hybrid) $0-$1000 0-5.9%
Corolla $0-$750 0-3.9%
Tacoma $0-$500 0-5.9%
Camry Solara
(excl. convertible) $0-$500 –
2006 models
Toyota Tundra $0-$4,000 0-1.9%
Sequoia $0-$4,000 0-2.9%
4Runner $0-$3,000 0-2.9%
Highlander (excl. Hybrid) $0-$3,000 0-3.9%
Sienna $0-$2,000 0-1.9%
Tacoma $0-$1,500 0-5.9%
Camry Solara
(excl. convertible) $0-$1,000 2.9-4.9%
Corolla $0-$750 0-5.9%
Highlander Hybrid – 0-4.9%
August Incentives
Tundra, Sequoia $1,500-$4,000 0-3.9%
4Runner $1,000-$2,500 0-2.9%
Highlander
(excl. Hybrid) $1,000-$2,000 0-4.9%
Sienna $750-$2,000 0-4.9%
Camry Solara 0-$1,500 0-4.9%
Camry 0-$1,500 –
Tacoma – 3.9-4.9%
Highlander Hybrid – 0-4.9%
June incentives
Tundra $1,500-$3,000 0-4.9%
Sequoia $1,500-$2,000 0-3.9%
Highlander (excl. Hybrid) $1,000-$2,000 0-3.9%
Sienna $750-$1,000 0-4.9%
4Runner 0-$2,500 0-3.9%
Camry Solara (excl. convertible) 0-$1,000 0-4.9%
Camry 0-$750 –
Corolla 0-$500 0-4.9%
Highlander Hybrid – 0-4.9%
Matrix – 3.9-4.9%
Lexus ES, GS, GX, IS,
LS, LX, RX, SC – 6.29%
You call 6.29% APR an incentive? With a credit score over 720, every single Joe Customer can get that rate without much problem.
Lexus has traditionally never ever need any incentives to move its models. That, my friends, is a fact and one Cadillac couldn't claim for itself.
>> Ute set for September debut?
Holden's next generation of the VE/WM new model dynasty is now due in September. Mark it in the diary now.
Indeed, our sources have revealed that the lure of "substantial" export orders for "the Americas" have accelerated the planned launch date of the new Commodore Ute. It will now be unveiled ahead of a Spring launch and it will be part of Holden's export portfolio.
The new Ute will be exported in much larger volumes than the past generation of haulers, our source says. For example, right-hand drive VZ Utes have been exported in small quantities to South Africa (NZ's not really exporting, is it?) but the new Ute will be built in left-drive.
Just what badge it will wear is an interesting question to ponder.
Holden will verify GM's worst kept secret (that Commodore will go to the USA as a Pontiac) at an announcement in Melbourne next Thursday. This will correspond with a similar 'reveal' at the Chicago Motor Show in the USA. It is unlikely, however, that the Ute will go to the USA or South America wearing the same nameplate.
Whatever the badge, the most important US benchmark the Aussie Ute must measure up to can be found in your local hardware already. US market 'truck' beds are rated on their ability to swallow 8 x 4ft sheets of plywood and nothing else...
If we were betting types we'd wager that the extra wheelbase and new rear suspension the new generation Ute will boast will make sure the car does exactly that...
I think that the mid-80's idea of moving Cadillac more up market is one way of making things work. GM is going to redo much of the current models at both Pontiac and Buick. Perhaps a more sensible lineup will emerge by 2010. I can see some sense in a RWD Pontiac replacing the lower end of the Lucerne line, while a RWD Buick could replace the higher end of the Lucerne and DTS. The DTS would then become a $60,000 (base) sigma(2) sedan.
BUT today chevy is at the bottom in price ranges. Buick/Pontiac are in the middle with one going for performance and the other luxury comfort and Caddy at the top.
I can easily see Buick and Pontiac offering similar priced products aimed at different markets. G8 vs. Lucerne. I think most can see the difference yet they would probably price the same. G6 vs. future LaCrosse. LaCrosse will be FWD/AWD Epsilon 2 while the G6 will be either a new RWD vehicle or a FWD/AWD Epsilon 2 also. I can easily see a very performance oriented G6 next to a very plush LaCrosse. Think TL vs. ES. Same kinda cars but very different market strategy.
And Lucerne overlapping with CTS is not quite right. What I would consider a base CTS would MSRP over $37k. While Buicks most expensive, higher volume Lucerne is a CXL/V8 with a nice set of options is under $36K. Yes they have a CXS that prices out at $40k but only if it is fully loaded.
The RL is based on the Accord platform I'll have to check that.
Lincoln's and Buick's are alike? What that both brands cater to the older crowd in their 60's? I;m not trying to be funny but the average ages of both Lincoln and Buick are pretty up there though.
"They dumped Oldsmobile, because they were a lot like Buick, and I could understand that move. Olds drivers went to Buick's and some went to Lincoln's and Lexus's of course."
Question/Comment: I'm surprised your saying the people that bought Olsmobile's are now Lincoln and Lexus buyers because I would think a Lexus or Lincoln owner would make more money anually in their work profession than the former Olds buyer who had a Cutlass, an Alero, or an Intrigue.
Yeah I know about the last generation MDX sharing a platform with the Pilot.
and then: saturn-mazda,nissan, chevy-toyota,ford,..."
Chevy already competes head on with Toyota and Ford. Caddy already competes with MB. In my opinion either Buick or Pontiac can be lower cost alternative to Acura or Infinti. In my opinion if GM makes the Buick looks too sporty than they overlap into Pontiac's territory. I would take Pontiac myself to compete with Acura or Infinti because Pontiac has a more youthful image than Buick obviously. Saab does not have the name to start competing BMW. In my mind in the 80's Saab had their shot to compete with BMW but lost in the long run badly. Saturn I think they get alot of people who would normally buy Honda or Toyota rather than people who would shop Mazda or Nissan.
No, the ES is more of a plush/soft riding sedan, the TL is a sport/luxury sedan. The TL and ES are different cars.
The Chargers haven;t even gone to the playoffs that much since their 1994 Super Bowl appearence where they got blown out by the 49ers 49-26. I do think next season the Chargers will probably go to the Super Bowl and might be the preseason favorite to go the Super Bowl(representing the AFC) for the upcoming 07 season.
The Cubs are just losers it seems. I mean even the Red Sox won a world series in this decade.
Agree
Caddy already competes with MB
ummm...I agree in theory, but i think they lack the proper flagship.
In my opinion if GM makes the Buick looks too sporty Buicks than they overlap into Pontiac's territory. I would take Pontiac myself to compete with Acura or Infinti because Pontiac has a more youthful image than Buick obviously.
agree, I suppose I perceive infiniti to be a lot more sporty than acuras. What about lexus?
Saab does not have the name to start competing BMW
yea, but what else can they do. The whole entry-level market could be covered by Buick and Pontiac.
Saturn I think they get alot of people who would normally buy Honda or Toyota.
I would say imports in general...the people that wouldn't be caught dead in a chevy. So with a more sporty approach you find with the new camry and altima but not fusion/malibu.
I have sat in some of Fords 07 models and they're pretty good. I don;t think Fords have shoody workmanship.
"By the way, Ford sales are down 19% in January, but somehow Chrysler sales keep going up slowly but surely. GM sales were down too!"
Yeah but Ford's rental fleets sales were down 65% for January 07 vs January of 06. Ford's January sales to rental fleets accounted for 28% of total sales for the month vs 39% of total sales for January of 06. Ford says they don;t care where they are in the sales race because they just want to establish residuals on concentrate on their retail business. GM's sales to rental fleets in January 07 were also down by 30% vs January of 06. Chrysler's to rental fleets were down 10% for the month of January 07 vs January 06.
Your response: "ummm...I agree in theory, but i think they lack the proper flagship."
My response back: I thought the CTS was Caddy;s flagship. Whats wrong with the CTS being their flagship?
My comment: In my opinion if GM makes the Buick looks too sporty Buicks than they overlap into Pontiac's territory. I would take Pontiac myself to compete with Acura or Infinti because Pontiac has a more youthful image than Buick obviously.
Your response: agree, I suppose I perceive infiniti to be a lot more sporty than acuras. What about lexus?"
My response back: Infinti's are more sportier than Acura's. I think Buick cpuld make potential competition for Lexus but Buick doesn;t have the prestige or right image right now to compete with Lexus.
My comment: Saab does not have the name to start competing BMW.
Your response: "yea, but what else can they do. The whole entry-level market could be covered by Buick and Pontiac."
My response back: Thats true in regards to commenting about Saab.
Caddy's look like Nissan;s: My eyes must be not seeing something clearly because I don;t see any Caddy;s looking like Nissan's.
"Cadillac lost me years ago when they put in a 6 cyl and stick shift. What were they thinking?"
There is stick shifts in Caddy's(not including "V" Series models?) I could see GM putting stickshifts into their "V" models (if they don;t have stickshifts in the V Series models already) because they are enthusiast models but putting a stick shift into a non-enthusiast model Caddy why would they do that?
"Pontiac should have been axed before Oldsmobile. That Aurora was sweet."
Oldsmobile at the time didn;t have the name in order for a car like the Aurora to sell well in my opinion. Maybe it would have sold well as a Buick(if priced correctly like high 20k price range.) I don't know though because Buick I think had a little better name than Oldsmobile at the time. Maybe an Aurora could have put some life in the Buick brand in the late 90's.
No, the ES is more of a plush/soft riding sedan, the TL is a sport/luxury sedan. The TL and ES are different cars.
Thats what I meant exactly. Similar cars but tuned and marketed to different markets.
to me Infiniti and Acura make premium/sporty $30K + cars. Lexus makes premium/Luxury $30K cars.
They would have been better off killing Olds BEFORE they invested all that money in the Intrigue/Aurora and put the money instead into Buick.
Buick was profitable back in 1997-1998? I was just granduating high school in 98 so I really didn;t follow press releases and have any insight business wise how different car brands were doing at that time.
Buick was profitable because they were only selling 3 platforms, while Oldsmobile, with at least 5 platforms, was selling fewer vehicles. But, since Oldsmobile's platforms were generic GM platforms, I do not really understand how they can say that Oldsmobile was not profitable, when other divisions were. I don't see how Saturn is profitable...
Buick was selling the LeSabre, Park Ave, Regal and Century. Three platforms.
What do you mean generic GM platforms(can you explain more clearly?) Like you said Olds sales were down so thus in my opinion Olds was losing money because of lack of sales probably.
My guess on profitability is that if sales did not exceed some minimum number, the costs of that model would exceed revenue making it unprofitable. Oldsmobile was probably trying to sell too many product lines.
I think the fact that we can have so many discussions about what each division stands for, how they do or don't overlap, etc., shows how the strategy isn't very good. I suspect that if GM were forming today they would never choose to form all these divisions. This is a legacy situation that's hard to correct for in any rapid way. But not a desirable one.
http://www.gm.com/company/corp_info/history/gmhis1900.html
Saturn was added to the line up in recent years and I am not sure that it has been good. If GM could begin new (this is not possible), it would make a lot of sense to have two divisions like Toyota has, a basic division and a luxury division. (toyota & lexus)
2014 Malibu 2LT, 2015 Cruze 2LT,
The only reason why Buick was worried was that the average buyer was going up 1 year in age every year. They were afraid of it dieing out with the customers. Did just read however that the average is at 63 and has been for 5 years. Pretty good news and with the new Enclave it will drop as the Rendezvous did the same thing when it came out. I guess the strategy of developing the LaCrosse and Lucerne to satisfy both the old and middle age has worked. Hopefully the next generations aim a little bit younger.
Chevy-affordable tranportation
Pontiac-mid range performance
Buick-mid range luxury
Cadillac-expensive luxury
Toyota has 3 divisions and as they approach GM's volume each will be selling lots of cars. In fact it now looks like they are even starting a 4rth division-expensive performance Lexus. Question that will be answered in 5 years is if they should have started a 4th division for performance lux.
I think they are worried that Lexus brand character may be diluted/confused with two very different vehicle types. time will tell. Can Lexus sell a performance vehicle or should they have had a 4th brand?
Many folks have been saying that the OHC motors are what people want. I didn't follow Olds to pay attention to motor types. You're saying that they put in OHC and people didn't want them because sales dropped.
That's odd. Were the motors lacking in some way?
2014 Malibu 2LT, 2015 Cruze 2LT,
To speak real performance, you need to have a manual tranny, and Lexus hesitates here.
Enthusiasts aren't running over to Lexus to use the Ls' 8-speed anytime soon.
You seem to think Toyota is looking to model themselves after GM, but I don't see it.
Scion will stay under 200k units total for the forseeable future. Toyota doesn't want to dilute it's hip factor by overproducing it.
Toyota COULD use a sports division, but the F-Class isn't it. $20-40k sports cars would enhance the brands stodgy image tremendously, but I'm not holding my breath.
DrFill
drfill, looks like Toyota is bringing back the Supra. That could certainly be a good start.
What they should have done is "make" Saturn take the Intrigue and Aurora (Saturn would not take them) and add to their stable. The Intrigue has an excellent interior, looked great and had a good motor. Aurora was the same but I never really was not that impressed. To me it was pretty big on the outside but tight on the inside.
After awhile you can get too many of one car. If the Camry ever tried to get 1,000,000 sales (and to get to GM volumes it will have to) they will become too common and folks will be turned off either because they will not the same car as everyone else in the neighborhood or it will get some kind of old person stigma or something. At one time you could sell 1,000,000 cars but we used to sell a lot fewer cars in this country and you just did not have much of a choice. Today there are choices everywhere.
You say they do not want over 200k scions, OK. They also cannot get the volume by selling the Lexus because that high end market is limited and that market is even more fickle to having the same car as everyone else. So what can they do? Well they can increase volume in trucks and SUVs and they are doing that. They can also fight for more high end volume by building something different and we see that with the performance Lexus. But to get the GM volume they need more high volume vehicles in the affordable range. Not sure how they will do that.
Supposedly, we now live in the "information age". When I grew up, people looked at Japanese cars as cheap junk, and Euro cars as expensive high quality cars to aspire to. Now, it seems the tides have turned somewhat regarding Euro cars, but the Japanese vs. "American" is reversed.
My question is, given the fact that nearly anyone who wants to research a car purchase can find out darn near everything about a given auto, Why is the actual brand important? Why does any brand need more than one nameplate?
For example, say you have $40,000 to spend.
Person A with $40,000 walks into a ***** dealer and wants the RWD mid size with V-8, 6-speed manual, leather and four doors. This person wants a brute that is fast, and can cut the corners on the scenic canyon drive.
Person B with $40,000 walks into a ***** dealer and wants a mid size 4-door with leather, auto, and a supple ride. (s)he doesn't care about handling, 0-60, or gold badges. This person basically just wants the living room on 4 wheels.
Why can't both people buy the same car, just with different option packages?
My utopian view is that these people would leave with a completely different car, even if they both start out as the same model.
Same thing with Buick, Pontiac, Chevy, Cadillac & GMC.
Same thing with Honda & Acura.
Same thing with Toyota, Scion & Lexus.
Same thing with ... Am I making sense?
Isn't the "chevy man" or "Ford man" or "Toyota man" going to become a dieng breed as more and more people realize these are nothing more than modified versions of existing autos?
It seems to me that autos in general would be cheaper if the choices were as diverse as they now are, but a wide variety of "personalities" existed for any given platform.
For example, it seems to me that the Cobalt vs. G5 could be handled via customization, vs. shopping to completely different dealerships.
Cliff notes:
When will people be more concerned with getting the type of car they want, as opposed to some actual brand?
Is brand loyalty still a big deal, or will that come to an end?
I am not coming at this as pro or con for any point of view.
I just have too much time on my hands, and wonder why ordinary people make such a big deal out of what brand their car is, as opposed to what their needs/wants are.
I am thinking that most people don't make %100 rational choices regarding vehicle purchases, but that as time marches on, more and more folks in general will purchase vehicles (new) based on value, needs and wants instead of the actual brand name it is sold as.
I'm not trying to step on any toes, but I'm wondering if I am just an idiot, and why I am wrong. I do have a flame suit at the ready!
1. small hatchback or wagon, preferably no longer than 175"
2. automatic with power windows, heated outside mirror
3. reliable, meaning except for scheduled maintenance, does not need any other attention.
4. handle reasonably well. I am interested more in the 5-55 range. Top speed not important. But important is being able to get through packed snow, especially on back roads and residential areas.
5. room for a bicycle or large dogs or computer system
I looked on the Web for what would fit and came down to Hyundai Elantra, Kia Spectra5, Ford Focus, and Scion xB. When I went into dealerships, those are the ones I looked at, not because I was drawn in by a Solstice. Most sales people don't know what is on the Web for the vehicles they sell, regardless of brand. They only know what they were handed by the dealership.
2014 Malibu 2LT, 2015 Cruze 2LT,
I know for a fact the Oldsmobile dealer serving this corner of the city area put a Nissan store right in with the Oldsmobile. Same building, same lot. The Nissan seemed to get larger, better display and advertising than the Olds.
The deal also had stores for Chrysler Corp on the opposite corner on town on a Motor 'Mile' which seemed to get lots of attention from the owners. And true to form years later they closed the store in our area completely. Olds seemed to be the ugly stepchild--"not your father's kid either" to paraphrase "Not your father's Oldsmobile."
2014 Malibu 2LT, 2015 Cruze 2LT,
2013 Mustang GT, 2001 GMC Yukon Denali
No, look at coke vs. Pepsi. to some they are the same. To me they all taste strange except diet coke. I can tell the difference and ask for it. Same with cars.
there are too many variations for one type of car to meet all needs. And as long as the car makers know how to differentiate they customers will too.
Rational? What is your rational and what is my rational? Please do not suppose that I will ever agree with your rational choices.
Automobile had a nice write up on what went wrong at Oldsmobile. GM has some responsibility for dropping the proverbial ball with respect to Oldsmobile.
The point here is that the CTS is a very good design for a sports sedan, but if what you really want is a common low cost sedan, then the expensive steel alloys are a waste. The Camaro will be built on the less costly platform to make a less refined vehicle at lower cost.