WILMINGTON, Del. – The pricing battle among major automakers intensified
Wednesday when rivals General Motors Corp. and Ford Motor Co. began
offering more cash to customers on new cars and trucks.
GM's latest program targets current GM owners, who can qualify for up to
$5,000 in cash on most 2003 and 2004 vehicles. The new offer, which runs
through Aug. 2, can't be combined with existing incentive deals.
For new customers, the automaker said it continues to offer hefty cash
rebates and low- to no-interest financing options on most vehicles,
including trucks and sport utility vehicles.
Speaking on Wednesday at GM's annual shareholder meeting in Wilmington,
GM chairman and chief executive Rick Wagoner said incentives remain an
effective tool for generating showroom traffic – but a nagging drag on
profits.
GM, the world's largest automaker, generally has been the kingpin in the
fierce U.S. pricing war that began after Sept. 11, 2001, to help prop up
the industry.
These days, nearly every automaker is offering some type of discount on
their vehicles. Some tried to pull back a bit earlier this year and saw
sales decline.
"I suspect for at least the next while, as long as the economy is still
coming back as opposed to running on full steam, we're going to have to
battle it out in the market place a little tougher than we might like,"
Wagoner said.
At Ford, the No. 2 U.S. automaker has raised the customer cash available
on Freestar minivans by $1,000 to $5,000. The offer is good to customers
who finance the vehicle through Ford's credit arm.
Those who don't use Ford's credit agency are eligible for a smaller
discount.
"It's a reflection of tough sledding in the minivan market despite good
product," Ford spokesman Jim Cain said.
Like GM, Ford continues to offer discounts on a variety of other
vehicles, including $1,500 to $3,000 cash rebates on pickups.
DaimlerChrysler AG's Chrysler Group also has several ongoing deals to
spur sales, though a spokesman said no enhancements were announced
Wednesday.
In early afternoon trading on the New York Stock Exchange, GM shares
were up 27 cents to $45.29, Ford shares were off 19 cents to $14.85,
while DaimlerChrysler's U.S. shares were up 18 cents to 44.45.
Find a Car
