Is the GM Card Worth It?

[Ming]

Is the GM Card Worth It?
www.GMInsidenews.com
Commentary by Ming

You'd think with sagging sales that GM might pull out the stops on incentives and ways to get people into their cars. Especially GM loyalists, suppliers and employees. If not with crazy Red Tag sales, then with "money" that GM Card owners have saved up over the years, waiting for a good opportunity to use their points on GM cars. Every year that passes, however, has the GM Card program seeming a little less attractive as a means of enticing people into buying GM cars.

What's wrong (or right) with the GM Card:

1. Ridiculous Hoops to view earnings and allowances --- logging in to the GM Card site is a pain, you have separate log-ins for your account and earnings. You frequently have to "re-register" and remember pin numbers and such if you don't visit the site often. Used to be that anyone could see how many points were allowed for redemption on each vehicle - like regional cash back offers are viewable by anyone at GM's website. Now GM makes sure that people considering a GM card don't see how it really works before getting a card.

2. Unimpressive Redemption Allowances. I once complained that SUVs and Trucks - GM's least fuel efficient vehicles - were given allowances up in the $2-3,500 range while fuel efficient 4-cylinder powered cars often got no better than $500-1000 in points allowed for redemption. GM used to regularly send me "Double Your Points!" offers in the mail that only really applied to Trucks and SUVs due to redemption allowances. I'm happy to say that changed, but not in a very good way. Instead of raising redemption allowances for smaller cars significantly to match SUVs and Trucks' impressive offers at the time (though the Aveo now does qualify for $1000 of points), GM has instead made sure that the misery is spread evenly across all vehicles, and that allowances are disappointing now even for big, profit-packed SUVs. The biggest allowances seem to have little to do with profit margins anymore, and more to do with GM wanting to move poor-selling metal. Take the 2,000 point allowance on the Uplander, compared to the 1500 point allowance on the Suburban.

3. You Can't Combine GM Card Earnings with other offers, like the GMS discount. If you have a good discount, you may well find your card earnings piling up useless after going to the Chevy salesman and finding out that the car you want is selling for close to sticker (time to use your GMS). A car with heavy incentives on it or one that a dealer might want to get rid of (like the Uplander) however, benefits from both large incentives and good GM card redemption limits. So if you want the car no one else wants, leave your GMS at the door and use your points.

4. Too Many Versions of the card, including legacy cards. You have the flexible earnings card, the business card, the GM extended family card, and Blue, Gold and World cards. Did I miss any? How about a single card that really encourages people to use it no matter how many points they've accumulated?

5. Used to be 5% earnings, now it's 3%? If you look at the GM Card Site now, it says 3% on all purchases toward a GM car or truck. But now you can use the GM Card Bonus Shop! Well, I still get the 5%, so I'm good, but not that there is any car I want to and could use my full 3500-plus points on. I'd need to buy 3 and 1/2 HHR's to get close to using all of my GM card earnings.

$1000 off a car with few other incentives? How is that significantly better than, say, Suzuki's "Free Gas for the Summer", Customer Loyalty, Graduate Bonus, on top of regular Cash Back offers? Or some seasonal volume sales discount from a local Toyota dealer? At least give GM card owners the option of using all of their points every now and then - once a year or so. It will keep them saving, where they have me stopping. On top of that the points I am allowed to redeem are not high enough to convince me that buying used is not a far superior alternative, especially on a depreciation-mobile.

Credit Card Earnings Programs like Upromise, Discover, American Express offer impressive savings plans that can be used without "redemption limits". The Upromise card, for example, allows 10% savings that will go straight into a college savings fund, and depending on the place where you use the card, you can get another 1-5% (or more) on top of that.

The GM card today really only seems worth it if you have no access to other special GM discounts and buy GM cars very frequently. Or maybe if you just plan to own the card for a couple of years until the first time you redeem your points.

If you dream of saving up for years to help pay off a chunk of a fuel efficient, inexpensive car, reducing what you owe significantly on it, then you'd either better have a legacy "Blue" card where the redemption limit that was once unlimited is now $3500 (last I checked), but applies to any car, even an Aveo or Cobalt.

It's also worth it if you like buying GM cars that are out of favor with the public, and drive them long enough that the resale value of an Uplander, for example, doesn't matter to you.

In short, it's a headache you really don't need if you're not buying a new or unpopular GM car every couple of years, and there are better reward card plans out there. I haven't used my card earnings since 2003 for reasons related to the issues above.

And just recently I've decided to put my GM card usage on hold in favor of another card. So it sits unused, with points piled up and nothing I want to spend them on.

There are some GM loyalists who might say, "stop complaining and moaning, it's a good bonus, so use what they'll give you, shut up and be happy".

That might be fine for them (especially those lucky Blue card owners that don't understand what I'm complaining about), but I actually care about getting bang for my buck, and if other Credit Card deals out there are superior, why would I continue to use the GM card, pushing my unuseable points ever higher?

Request to GM: Raise redemption limits for all car types to levels that make me feel like going out and using them on a new GM car purchase.

[K Dawg ONE]

I know that first hand, I see almost every sale of mine using the max ammount of point either from their own card or from a family members card.

Going on with the many almagamation of GM threads, I think GM Canada has got their sh¡t together way more than our US counterparts (well, other than we are only now starting to use order workbench where you guys have been using it for 10+ years).

GM visa points in Canada can be combined with ANY program other than a PEP 2/3/4 vehicle.

A gentleman back in the winter time, got a one year lease on a Solstice GXP for $180/mo taxes inc. by using Option 2, BUZZ bucks, the max 2000 visa points, GM wish and win (employees all got a standard $500), as well as student bonus (he was smart enough to go to school knowing that the tranny plant was eventually gonna close and since GM was paying for him).

As a side-bar, back to 'GM Canada doing things right', currently this how our networks are set up:
Pontiac-Buick-GMC
Chevy-Caddy
HUMMER*
Saturn-Saab
(*HUMMER can be independent or can go with any line like how we have it with PBG)
Some dealers also have four line stores that are Pontiac-Buick-GMC-Chevy (like the last store I worked at). This system seems to work quite well here....

[04bonnie]

I agree with you 100 %. Very well written, and you got every point put down there, good job! It would be nice if the GM card earnings were all able to be used, on any vehicle, with as much as you've saved up. Are they scared that people might actually buy more vehicles if this were the case? Or do they think it would eat into profits? Well, don't they make money on the GM card anyway, so what gives? Hopefully they allow me more than 1000 dollars towards an Enclave in a couple months, but I doubt it. Like the article says, on hot vehicles, the allowance is less. Why not, if they are going to have limits, have it percentage of what the MSRP is, that's allowed. So, on a Cadillac, you could use the most...that makes sense.

[mjd1001]

I agree also. I still use my GM card for purchases every month, but I stopped using it for ALL my purchases (which I used to do) and have started to use a couple other cards.

To me the biggest point you made is to simplify things. Card earnings are Card earnings, let me use them whether I use the GMS discount or not..or other incentives or not. Also, if you want to limit redemption allowances...make it the same for all vehicles.

A good program becomes a bad program when instead of keeping it simple, companies simply keep adding more and more options and more and more restrictions. (Kinda like the U.S. tax code, isn't it?)

Why not something like this? Make earnings 5% across the board. Cap redemption allowances at $1500 per vehicle, but with no exceptions (and can work with any other promotion). For people who have 4,5, $6+ thousand dollars in earnings...how about a 'one time' option to allow them to use those earnings on certain vehicles now (trucks or SUV's GM is having trouble moving...cars late in their model run, like a Grand Prix, Impala, etc?)

[Ming]

For those who don't get what I mean with the competition - take this example:

2008 XL7

2500 Factory Cash Back
1000 Owner Loyalty
1000 Graduate Incentive
500 Military Incentive

- Or -

0.0% for 60 Months + Free gas for XL7 valued at $450 (Cash Card). Offers expire 06/30/2008.

Plus

Competitive Owner Incentive

Trading in a SUV or a minivan? If so, you may qualify for $1000 additional customer cash when purchasing a new 2008 XL7.* Offer expires 06/30/2008. *Click here for details

Something depressing about knowing that the "Competitive Owner Incentive" + Free Gas one shot deals are about equal to cash that took me about a year to accumulate on my GM card that I'm allowed to use on, say, an HHR or Equinox. And this is coming from a maker, Suzuki, that usually has pretty puny incentives and MSRP's closer to invoice than GM.

[K Dawg ONE]

Originally Posted by Ming

For those who don't get what I mean with the competition - take this example:

2008 XL7

2500 Factory Cash Back
1000 Owner Loyalty
1000 Graduate Incentive
500 Military Incentive

- Or -

0.0% for 60 Months + Free gas for XL7 valued at $450 (Cash Card). Offers expire 06/30/2008.

Plus

Competitive Owner Incentive

Trading in a SUV or a minivan? If so, you may qualify for $1000 additional customer cash when purchasing a new 2008 XL7.* Offer expires 06/30/2008. *Click here for details

Something depressing about knowing that the "Competitive Owner Incentive" + Free Gas one shot deals are about equal to cash that took me about a year to accumulate on my GM card that I'm allowed to use on, say, an HHR or Equinox. And this is coming from a maker, Suzuki, that usually has pretty puny incentives and MSRP's closer to invoice than GM.

Right now, we currently have Mid-Car Magic...if you own a mid-size car (ie, GP, GA, Camcord, Taurus, etc), you get $750 off your purchase without trading the car in. Before that, we had People Mover (same idea, but with Vans and SUVs), end of last year, its was Small Car Suprise (again, another loyalty/conquest of compacts worth $750).

So, lets look at a G6 for instance:

$1750 Cash back
$750 cause you own an Intrepid*
$800 Student bonus (first two payments up to $400/pmnt)
$500 Free gas
(plus, you could still use GM Visa Points($1500), Military($500), etc)

And, you can use all these discounts and STILL finance at 0% for 72 months!!!

Maybe the US is different than Canada, but, our programs up here are always decent...and we dont have 3 Days of 0%...we run our programs for 3 months at a time!

[osv_alero]

We got rid of both our GMAC mortgage and auto Visa as neither gave us enough points to be worth the effort.

[FenwickHockey65]

I'll take your GM Card points.

We don't use our GM Extended Family card as much any more. My dad had a little scuffle with one of the operators. We still use it on some things every month, but we use another card now.

[TruckMan]

Why would you use a rewards card that is so limiting? I got rid of my GM Card because of the redemption limitations. Now I use my Discover Card 100% of the time. There are no limits. If I want to save up $10,000 to use for a new car, I can. And I can use the rewards on anything, not just a GM car.

[CamaroCrazy]

Good points Ming. I have had the GM Card for about 5 years now and I've never redeemed my points (mostly because I've never bought a new car). I use the card on a limited basis because after watching all the offers over the years, it always seemed like $1000 points or so is all they would ever let you use at one time. I plan on buying the new Camaro and I'm anticipating GM is going to restrict the points you can use on the car because they're going to want to get every dollar they can from a sale. I hope I'm wrong, but I can just imagine GM getting stupid with the points on the Camaro. I mean really, why is it that you could never use your points on a Saturn until recently? How dumb is that? You're right, they could use this card better to encourage more buyers to pick GM. I wonder if Toyota has a card and how they use it.

[Buickman]

given how frustrating the GM Card is to loyalists, imagine how the average Joe feels. he simply goes elswhere, likely never to return. just another shining example of GM marketing idiocy.

[2002 Caddy]

Originally Posted by Buickman

given how frustrating the GM Card is to loyalists, imagine how the average Joe feels. he simply goes elswhere, likely never to return. just another shining example of GM marketing idiocy.

Yup...

GM could use this as an AMAZING marketing tool... Instead they just let it sit there...

How about the ability to use points towards vehicle serving a the dealership? or OE parts, or certified used cars at dealerships...

ANYTHING that you can do to get a customer to your dealerships is A GOOD THING.

I have one in my wallet... I never use it... Its only a back up to my airline "miles" card... its sad that its easier (and more satisfying) to use an "airline" points card then the GM one.

[Will75]

Wow! Perfect timing, Ming!!

I have had the GM Card for 6 years (now the GM World Card) and used it twice in that time. The first time I received a top off offer and used $2,500 on a Cobalt. Next they let me use all my points at the time, just over $3,500 on a Silverado! "Man, this card is SOOO worth it", I thought.

Now, as I am looking to buy a G8 GT this week, I call them up to see if they will once again let me use my $3,711 points toward the car. Three people and a lot of arguing later...."The redemption on this vehicle is $1,000 and last time was a one-time offer." Now, I would think that if they did it once, SOMEONE could do it again, right?! "We would get fired if we did it again" I am told.

So, if they let me use $1,000 of my $3,711 on this car, then the GM Card to me is little better than DIscover with it's 1% cash back! And no, I am not buying a cargo Savana to use $3,500 in redemptions. After 3 years of no activity, I transferred my GM Card balance to my 11 year old Visa and am off the GM Card wagon...

[GTOken]

I have the old GM card. Ive use the points once I think for $1000 when I bought my 2000 K2500 crew. Its been at $3500 for the last 2yrs. I can use the $3500 on any new GM and still cant find a vehicle I want that I can afford. Ive just about decided to start using my Discover card only. At least thats cash in hand and a lot of purchases are at 5%.

[91Saturn]

Yeah, the answer to "Is the GM Card Worth It?" is "Depends on which GM Card you've got."

The version of the card that I have IS totally worth it. I started with the old Blue card in 1998. At some point, they changed it to a gray "World" card, but the terms are the same. 5% on your first $10,000 in purchases per year for 7 years, for a maximum of $500 per year and $3,500 total. No individual vehicle limits. I've used it twice, most recently for about $3,000 off of a new Malibu.