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Rivals critical of GM's new incentives

April 1, 2003 at 12:55 PM   |   Comments

DETROIT, April 1 (UPI) -- Ford and Chrysler Tuesday said General Motors Corp. is throwing good money after bad by offering 5-year, zero-percent loans on all of its vehicles except Hummer through April.

GM called the "Zero to Sixty" program the most sweeping marketing incentive in its history.

Credit-worthy buyers of 2003 model Buick, Cadillac, Chevrolet, GMC, Oldsmobile, Pontiac, Saab and Saturn vehicles will be able to qualify for no-interest 36-month, 48-month and 60-month loans, or $2,000 cash back on Chevrolet Corvette, Pontiac Vibe and Saturn VUE and ION, or $3,000 back on Buick, Chevrolet, GMC, Oldsmobile, Pontiac, Saab and Saturn passenger cars and trucks.

The hot-selling military-styled Hummer is not included in the deals, which GM began advertising in a nationwide print, television and Internet campaign Tuesday.

"We are offering consumers our most compelling and simple offer ever," said John Smith, group vice president of GM North America Vehicle sales.

Smith said the incentives were not inspired by any sales collapse or dip in consumer confidence because of the war in Iraq. But GM had to do something about inventories of unsold vehicles growing to double the typical 50-day supply of cars and trucks.

The Wall Street Journal said GM Chief Executive Officer G. Richard Wagoner told a banker's conference last week General Motors was "not crazy about incentives, but we like them a lot better than closing plants and not selling cars."

GM's market share fell nearly 2 percent in January and February to around 27 percent.

The world's largest automaker jumpstarted industry sales after the Sept. 11, 2001, terror attacks by offering unprecedented no-interest financing, forcing Ford and Chrysler to match the generous incentives to meet the competition.

Toyota is offering 0 percent interest financing on its popular Camry and Corolla cars, which had sold well without incentives.

Ford was critical of the costly offers.

"We see our largest competitor, who has lost market share in five of the last six months -- while spending more than anyone else on incentives -- throwing good money after bad," a Ford spokesman told the Detroit Free Press.

Chrysler was expected to extend its "Best Values in America" campaign that offers up to $3,500 cash back and a 7-year, 70,000 power train warranty.

Topics: John Smith
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