2005 & 2006 Rebates
Auto incentives are addictive, and it will be tough to get consumers to kick that habit.
Auto incentive programs have become like a drug, and rehab won't be easy. We don't know if there is a methadone for new car incentives. They're here to stay.
Auto incentives propped up last year's record high vehicle sales as automakers fought for market share.
If car rebates were taken away or cut substantially, it would hurt new car sales, and really push people into the used cars market.
As automakers mull over what level of profit-draining car incentive programs to offer, the public's appetite for them grows.
Fifty-three percent of the people polled in a latest annual survey of American car buying patterns say new car incentives put them into the new cars market. That's up from 45% last year and 36% the year before that.
Nearly 60% of those polled say auto rebates influence the make and model vehicle they buy.
If auto incentives get people into the marketplace, it's at a high cost.
Generous car rebates played a big part in the Chrysler Group's staggering financial losses of late. Chrysler's new president, Dieter Zetsche, says he'd like to ultimately back away from auto incentive programs and the like.
It would be very interesting to see if he can get Chrysler off auto incentives. Maybe he will find consumers will go to other makes which do offer car rebates.
That was the dilemma faced by Mr. Zetsche's predecessor at Chrysler, James Holden, who lost his job when Chrysler lost so much money.
Mr. Holden knew hefty car incentives were clawing into Chrysler's profits. He openly scorned General Motors Corp. for upping the car incentive programs stakes to reduce bloated inventories. He called it “mortgaging your future.”
Then he went ahead and matched GM's hefty car dealer incentives. Despite Mr. Zetsche's distaste for them, Chrysler last month upped its auto incentive programs on a number of models.
Automakers could play with the numbers to cushion the effects of car incentives. For instance, they could increase the MSRP of a vehicle by, say, $2,000, then knock off $2,000 through car rebates. That's risky however.
To some extent, that's probably going on right now. But there comes a point where your product gets knocked off shopping lists if it's priced too high.
People in the used cars business would love to see auto incentives end or at least reduced.
auto incentive programs on new cars hurt the value of used cars.
For the used car market, there's a dollar-to-dollar ratio on new car incentives, For every dollar you put out as an auto incentive, there's an equal downward impact on the used side.
If you are in the market for a new car, be sure to check the latest incentives. We list car rebates from the following makes: Acura, Audi, Buick, Cadillac, Chevrolet, Chrysler, Dodge, Ford, GMC, Hummer, Hyundai, Infiniti, Isuzu, Jaguar, Jeep, Kia, Land Rover, Lincoln, Mazda, Mercury, Mitsubishi, Nissan, Pontiac, Porsche, Saturn, Toyota, Volkswagen.