G.M. Extends Deep Discounts Through End of September
By VIKAS BAJAJ
Published: August 25, 2005
General Motors is extending deep discounts on 2005 model year cars and trucks through the end of September and has added some 2006 trucks and sports utility vehicles to the promotion as well, raising question about the automaker's increasing reliance on sales incentives.
A G.M. spokeswoman, Deborah Silverman, said today that the company would prolong the successful sale program that was set to end after Labor Day until Sept. 30.
The addition of vehicles from the 2006 model year caught some Wall Street analysts off guard because the company had said it was moving away from discounting in the coming year, choosing instead to simply lower the base price of cars and trucks. New models that will join the employee discount roster include the Chevrolet Avalanche, the Chevrolet Suburban, the GMC Yukon and the three Cadillac Escalade models.
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Struggling with slowing sales and bloated inventories, G.M., the nation's largest automaker, started its employee discount promotion in June and later extended it to July and then again until Sept. 6. It has been quite successful in increasing sales (up 41 percent in June and 20 percent in July) and unloading inventory.
But analysts said the program has probably also conditioned consumers to expect deep discounts. "You really start to wonder whether anyone is going to buy a car at regular price anymore," said Kevin Tynan, an analyst at Argus Research....
http://www.nytimes.com/2005/08/25/automobiles/25cnd-auto.html
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