Automotive News - March 10, 2008 - (Page 44)

44 • MARCH 10, 2008 Sagging Chrysler boosts spiffs Bradford Wernle bwernle@crain.com Customer SUBARU Incentives Cash rebate Finance rate Cash rebate Finance rate Incentives in this table are a summary of retail programs offered. Programs may vary by region and model. BMW Expires April 30. 2008 models 3 series – 3.9-4.9% CHRYSLER LLC Expires March 31. In lieu of rebates, cut-rate financing is available. 2008 models Chrysler 300C, Aspen $3,000 0-4.9% PT Cruiser (excl. convertible) $1,500-$3,000 0-8.9% Pacifica $2,000-$2,500 0-1.9% Sebring $500-$2,500 0-8.9% 300 (excl. SRT8 and C) $2,000 0-4.9% PT Cruiser convertible $1,000 0-8.9% Dodge Ram 1500 $5,000 0-1.9% Ram 2500/3500 $4,500 0-1.9% Durango $3,000 0-1.9% Charger, Dakota, Magnum $2,000-$3,000 0-4.9% Grand Caravan $1,500 0-4.9% Avenger, Caliber $1,000 0-8.9% Nitro $750 0-8.9% Jeep Commander $3,500 0-1.9% Grand Cherokee $1,500-$3,500 0-8.9% Liberty $1,500 0-8.9% Compass, Patriot $500 0-8.9% Wrangler – 0-9.9% FORD MOTOR CO. Expires March 31. In lieu of rebates, cut-rate financing is available. 2008 models Ford Explorer $3,000-$4,000 0.9-6.9% Expedition, Expedition EL, F-150, F-Super Duty $2,500-$4,000 0-6.9% Explorer Sport Trac $2,000-$4,000 0-6.9% Ranger $2,500-$3,000 0-6.9% Escape, Fusion $1,000-$3,000 0-6.9% Mustang $1,000-$2,000 1.9-6.9% Focus $500-$2,000 0.9-7.9% Taurus $0-$2,000 0.9-6.9% Econoline, Edge $1,000-$1,500 1.9-6.9% Taurus X $0-$1,500 1.9-7.9% Escape Hybrid – 4.9-8.9% Lincoln Town Car $5,000 0.9-4.9% Mark LT $3,000-$4,500 0-3.9% Navigator $1,500-$3,500 1.9-7.9% MKZ $1,500-$2,000 0.9-6.9% MKX $500-$1,500 0.9-6.9% Mercury Grand Marquis $5,500-$6,500 0-3.9% Mountaineer $2,500-$4,000 0-4.9% Mariner, Milan, Sable $0-$2,500 0-5.9% Mariner Hybrid – 4.9-8.9% GENERAL MOTORS Expires April 30. In lieu of rebates, cut-rate financing is available. 2008 models Buick Lucerne $1,500 3.9-6.9% LaCrosse $1,000 4.9-6.9% Enclave – 5.9-7.9% Cadillac DTS $3,000 5.9-7.9% Escalade $2,000 5.9-7.9% CTS – 1.9-4.9% XLR, XLR-V – 2.9-5.9% SRX, STS, STS-V – 5.9-7.9% Chevrolet Avalanche, Silverado 1500 $2,000 0-6.9% Suburban, Tahoe, TrailBlazer $2,000 2.9-6.9% Express $500-$2,000 4.9-7.9% Silverado 2500HD, Silverado 3500HD $1,500 1.9-6.9% Impala $1,500 3.9-6.9% Equinox $1,000 0.9-4.9% Colorado, HHR $0-$500 3.9-7.9% Aveo – 4.9-6.9% Cobalt, Malibu, Uplander – 5.9-7.9% GMC Envoy $3,000 2.9-5.9% Sierra 1500 $1,500-$2,000 0-6.9% Savana, Savana cargo $500-$2,000 4.9-7.9% Yukon XL $2,000 4.9-6.9% Sierra 2500HD, Sierra 3500HD $1,500 1.9-6.9% Acadia, Canyon $0-$500 3.9-7.9% Hummer H2, H3 $2,000 5.9-7.9% Pontiac Grand Prix $2,000 2.9-5.9% G6 $1,500 3.9-6.9% Vibe $1,250 4.9-6.9% Torrent $1,000 0-4.9% G5, G8 – 5.9-7.9% Saab 9-3 $2,500 5.9-7.9% 9-5, 9-7X – 5.9-7.9% Saturn VUE (excl. hybrid) $1,500 1.9-7.9% Aura $500-$1,000 4.9-7.9% Outlook $500 5.9-7.9% AMERICAN HONDA MOTOR CO. Expires April 30. 2008 models Acura TL, TSX – 0.9-2.9% MDX, RDX – 2.9-4.9% JAGUAR Expires April 4. 2008 models S-Type, X-Type, XJ – 2.9-4.9% LAND ROVER Expires March 31. 2008 models LR2, LR3 – 4.9-5.9% NISSAN NORTH AMERICA Expires March 31. In lieu of rebates, cut-rate financing is available. 2008 models Infiniti FX35, FX45, G35, G37, QX56, M35, M45 – 1.9-2.9% Nissan Titan $5,000 0.9-1.9% Armada $4,500 1.9-2.9% Pathfinder $2,250-$3,250 1.9-4.9% Frontier, Maxima, Xterra $1,750-$2,500 0-3.9% Quest $2,000 1.9-4.9% Altima, Sentra, Versa $750-$1,250 1.9-3.9% 2007 models Nissan Frontier, Xterra $2,500-$2,750 0.9% Murano $2,000 1.9-4.9% Altima (incl. Hybrid) $1,500 1.9-2.9% VW GROUP OF AMERICA VW expires April 30. Audi expires May 2. 2008 models Audi A3, A4, RS4, S4 – 2.9% Volkswagen Touareg 2, GLI, GTI, Jetta, New Beetle, Rabbit, Eos, R32 – 2.9-4.9% Passat – 2.9-5.9% Chrysler LLC, already the industry’s biggest per-unit incentive spender, says it is boosting incentives by 5 percent this month over February to jump-start sales. Chrysler’s sales dropped 14.0 percent last month as the economy sagged. It spent an average of $3,520 per vehicle on incentives in February, the industry’s highest average, according to Edmunds.com. A 5 percent increase in March would amount to about $175 per vehicle, according to Jesse Toprak, Edmunds.com analyst. Dealers welcomed the latest round of spiffs. “I’m having the best start I’ve had in a long time,” said Carl Galeana, owner of Galeana Auto Group in Warren, Mich. The March incentives primarily cover vehicles not included in the New Day packages Chrysler already has in place. Under New Day, the company offers more equipment on 12 vehicles with modest price increases or none at all. John Schenden, owner of Pro Chrysler-Jeep in Thornton, Colo., said the incentives are giving him a boost after a disastrous February. “I think the incentives will be a During March, Chrysler is offering a free Hemi engine upgrade on Dodge trucks, including the 2008 Ram 1500. Chrysler sales fell 14 percent in February. huge help,” he said. “We’ve got the APRs (cut-rate financing) we need; we’ve got the rebates we need. There shouldn’t be any banks or credit unions beating the rates we’ve got.” Now Schenden wants more customers in the showroom. “Our traffic was off 50 percent last month,” he said. “It was the worst new-car month I’ve had in 15 years.” Schenden blames the lousy sales on local factors. Adams County, where his store is, has the highest mortgageforeclosure rate in Colorado. Chrysler’s March incentives include 0 percent interest for 72 months on most remaining 2007 units in stock and 0 percent interest for 60 months on some 2008 models. Chrysler also is offering Dodge truck customers a free upgrade to a Hemi engine during March. Steven Landry, executive vice president for North American sales, said Chrysler is trying to “stay positive” in the current economic conditions: “We know there will be an upside. If it is March, we want to be ready.” c FORD Dealer development stores offered buyout continued from Page 1 Buyout terms Key provisions of the buyout Ford is offering dealers in its development program The buyout will refund the dealer’s initial investment and in some cases include an additional $100,000. If a dealer’s current equity exceeds the initial investment, the buyout will cover the entire equity. Offer is open to all development dealers, including those who are losing money. The deadline for acceptance is April 1. Source: Ford Motor Co. fort to ensure a sustainable dealer development program,” program director Jamy Hall wrote in a letter to dealers that was obtained by Automotive News. Hall declined to comment, and Ford declined to predict how many dealers will take the buyout. Those dealers’ stores either will be closed or reassigned. Previously, Ford had offered buyouts on a case-by-case basis to struggling dealers in the program. After Ford disclosed its plan to end that practice, Ford’s two minority dealer associations asked the company to extend its April 1 deadline. On Friday, Ford confirmed it will consider stretching its deadline for dealers who ask for more time. But some minority dealer advocates say the buyout raises questions about Ford’s commitment to minority dealers. Ford rejects the suggestion. Shrinking network The dealer development program gives would-be dealers who lack adequate capital an opportunity to acquire their own stores. Using the store’s profits, the dealer gradually buys out Ford’s stake. But when a store loses money, a dealer can struggle for years in the program without repaying Ford’s initial investment. This problem has grown more acute as Ford shrinks its U.S. retail network to reflect declining sales. The consolidation is intended to improve sales and profits at surviving dealerships. Over the past two years, Ford has eliminated 340 stores, leaving it with 4,056 domestic-brand dealerships in the United States as of Jan. 1. The number of Ford’s minority-owned dealerships fell last year by 28, to 309, the company says. The number of stores in Ford’s dealer development program dropped by 21 last year, to 81 at the end of 2007. A handful of those stores closed. Dealers at eight stores bought out Ford’s stake. Nine additional stores were sold to private-capital investors. Ford added two dealerships to its development portfolio in 2007, after adding six stores in 2006 and 22 in 2005. “It’s definitely slowed down, but that obviously reflects the economy and other things,” says Ford spokesman Jim Cain. Ford “absolutely” remains committed to dealer development, he says. outlined his proposal in a note to the association’s members. Fleming says he expects as many as 17 minority dealers to consider the buyout. The Alliance of Ford Motor Minority Dealers, which mostly represents Hispanic dealers, also wants Ford to delay its deadline. Alliance President Jose Pozos says Ford is asking dealers — some of them profitable — to make a big decision at an uncertain time for the company. “I don’t think even Ford Motor Company knows what its future holds,” says Pozos, a Ford-LincolnMercury dealer in Wichita Falls, Texas, who graduated from the development program last year. “Why go there now?” One dealer who got the buyout offer says he will reject it. “It’s just targeted at minorities because they’re low-hanging fruit,” argues the dealer, who asked not to be identified because he says he fears retribution from Ford. Ford spokesman Cain denies that the company is targeting minority dealers. Instead, he says, Ford wants to provide a “graceful exit” to dealer development operators who are struggling. Dealer Incentives Incentives in this table are a summary of dealer programs offered. Programs may vary by region and model. Dealers to meet The Hispanic dealers’ alliance says it plans to meet next month with Ford executives. Alliance Chairman Fernando Varela says the group wants to discuss the expansion of Ford’s pool of minority dealer candidates. Varela, a multifranchise dealer in Palestine, Texas, also participated in the development program. He says Ford is doing more for its minor http://www.Edmunds.com http://www.Edmunds.com http://www.Edmunds.com http://www.Edmunds.com

Table of Contents Feed for the Digital Edition of Automotive News - March 10, 2008

Cheaper small cars are part of VW's U.S. plan Ford offers to buy back 81 stores As dollar dives, automakers juggle global strategies Jaguar-Land Rover deal will be signed within weeks GM Planworks chief leaves Jacoby cites dealer role in VW makeover Slim fast Nissan: Electric car to get here in 2010 Family honor Suddenly, Arkona's a key software player Chrysler may build vehicles in Russia Congress may ban mandated arbitration Volvo signs dealers willing to exit Breeding a hybrid? Prius could be a brand Honda adds benefits for same-sex partners Top China execs to speak at conference Manual for Challenger waits until '09 Ex-Sonic president: Gulf States raided Sonic GM, American Axle: Ties that bind Boardroom coup ousts Chamco executives False data imperil all auto financing Dealers would suffer if Calif. gets its way GM, Ford should bring Euro cars here Fresh ideas are fine, but Chrysler must be wary We need that 10% of useful inventions Safety options: Let consumers decide Tire monitors are full of problems Germany's labor setup just doesn't work Alabama adding auto jobs more slowly Engineer Banks strives to sip fuel, burn rubber Toyota Financial takes risks to aid dealers Honda captive beefs up dealer training in leasing NADA releases 2 subprime guides ADP develops e-sales brochure Credit unions' share of auto loans declines Upgraded auction ID carries a fee Dealers At hard-charging Hyundai, the plan is simple: More — now Genesis sedan's assignment: Boost image of all Hyundais Allied will supply sensing systems to Magna Haldex opens Mexico plant Behr gets Nano pact How Tupelo talked Toyota into building a plant there Infiniti FX showcases new Nissan technology Ford may consider hatchback for U.S. Audi to launch A4 sedan, wagon together BMW M3 convertible Saab hybrid concept has solar roof panels Toyota could bring tiny 4-seater to U.S. Hummer to push H3 pickup's usefulness New look for the SL Tiny Nano makes big waves GM's Opel unveils small hatchback that could become part of Saturn line Who says Americans don't want hatchbacks? 9-3 will dominate Saab marketing Lutz: Green takes greenbacks Leap year added to Feb. misery 9 U.S. Toyota executives will retire Ford gives employees $1,000 bonus Denso picks new N.A. CEO GM extends buyout offers CAW OKs TRW pact Lampert ups AutoNation stake Sagging Chrysler boosts spiffs Feb. output is up slightly Buick offers the Cadillac of caddies GM's board: The royal robe fits Fritz Be it metal or men, Geneva all about style Raising the roof (price) Italian cops bust Fiero-aris Consumer Reports' verdict on Chrysler products: Eeeee-uuw!

Automotive News - March 10, 2008

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