U.S. auto companies in discount price war |
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Thu, 07 Jul 2005 00:35
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DETROIT: U.S. automakers are following leader General Motors in offering discount programs to customers to buy cars and trucks and thereby register blockbuster sales.
GM had introduced a program in June to offer customers cars and medium duty trucks at prices the company offered to its employees. And this helped GM to clock a 41 per cent increase in its June sales. Encouraged by the response, the company said the program, which was set to end Tuesday, will continue till 1 August. All the 2005 models, except Chevrolet Corvette, Pontiac GTO and GMC medium duty trucks, are available under the program.
Now, the No 2 car maker Ford Motor said it is launching its own employee price program for all customers. The ''Ford Family Plan'' enables customers to buy most of the company's 2005 models at the employee rate beginning today. However, models Mustang, GT and the Escape hybrid are not included in the plan. The Ford plan too will be in force till 1 August.
A matching plan from DaimlerChrysler's Chrysler Group too has come into the market. The company said the program, called "Employee Pricing Plus", which began Wednesday and lasts through 1 August, slashes the sticker prices of all the company's 2005 models except Chrysler 300 sedan, Dodge Magnum wagon, Dodge Charger, Dodge Viper sports car and vehicles from Chrysler's SRT performance line.
In June GM sold 550,829 vehicles, up from 374,970 in June 2004. Interestingly, the growth came from light truck sales, 69.2 per cent to 375,092 vehicles.
The U.S. automakers have been struggling to regain the market share they have been continuously losing to Japanese auto majors like Toyota Motor Corporation and Nissan Motor Company. Ford has been losing its U.S. market share for 28 straight months and it has lowered its earnings forecast twice this year.
The Japanese companies, specifically Toyota, Nissan and Honda Motor Company said they do not have any price cut plans for its customers. Toyota had in fact announced an increase in prices effective 1 July of its Camry sedans and coupes ($150) and RAV4 compact SUVs and Prius hybrids ($300).
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