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Red Hot New Hummer: List Price Only; NO Dealer Markups; No Incentives

13K views 128 replies 26 participants last post by  CaptainDan 
#1 ·
Automotive News
October 22, 2020



GMC plans to use no-haggle pricing on the Hummer electric pickup when it goes on sale late next year.

The price customers see on GMC’s website will be the price they pay, Duncan Aldred, vice president of global Buick and GMC, said Wednesday.

“There will be no incentives. There will be no trickery,” Aldred said on a call with investors. “We are trying to construct a dealer margin in such a fashion that it really is a no-haggle price.”

About half of GMC’s dealers have elected to sell the Hummer so far. The “Edition 1” model is due in fall 2021 and will sell for $112,595. Dealers won’t be able to discount it or mark it up, Aldred said.

GMC will “deliver a one-price experience for the customer from the brand, from the website, right through to the dealer level,” he said.








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#2 ·
“There will be no incentives. There will be no trickery,” Aldred said on a call with investors.
Now there is a statement that may come back to bite them in the... They will really have to match production with demand. Will this vehicle be built to order only?

Imagine - You can now purchase a new GM product with a sales tax figure that would just about cover a base Chevrolet Spark!

Congratulations to GM on a great introduction. Let's hope the product matches the hype!









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#7 ·
GM needs to figure out a way to do sales like Tesla does...without the middleman dealership. That is part of the draw as well with buying a Tesla, no janky finance managers trying to tack on extra fees for pinstriping, paint protection, overpriced warranties, underbody treatments and so on.
 
#15 ·
Indeed. Saturn was unique among GM brands for having a loyal customer base in the "difficult" markets for GM, like the coasts, and the dealership experience was a huge part of that.

That said, Saturn had dedicated dealerships. Whether GMC dealers can effectively wear both hats (no-haggle for Hummer and haggle for the rest) remains to be seen. So far, selling EVs alongside gas vehicles has not worked well. I mean, if I'm a dealership, would I want to sell the car that needs no maintenance or the one that will pay me every few months for oil changes, brake pads, etc.? IMO, this is a big reason why Polestar is going to have a dedicated sales channels separate from Volvo dealers, and I think that's the right approach in the near term. GM is trying to have their cake and eat it too, which I think is challenging but, combined dealerships for both types is what they have to make work in the long run. It'll be interesting to see how it goes.
 
#16 ·
GM is trying to have their cake and eat it too, which I think is challenging but, combined dealerships for both types is what they have to make work in the long run. It'll be interesting to see how it goes.
ELR

Except the Hummer doesn't have a 1/2 price Chevy with twice the doors to compare to. In the end, they are both Very Pricey, Very Unique Vehicles, Not Very Diverse, in Very Limited Market.

The outcomes will be Very Similar.
 
#17 ·
High demand products can command msrp pricing if priced correctly ..

The c8 corvette is an example.

I believe Mary Barra and her team is quite tough when it comes to pricing or rather not giving incentives on specialty products specifically.

If the pricing is correct no incentive on the hood is needed. I think that is what we are seeing here.

Production will be limited to control excess inventory which would be the reason any manufacturer considers incentives .

112 grand fir a first edition is a lot of money. No question about it. For those who want this ev hummer first edition. I think they will spend the money.

I believe incentives will be on low demand products like the chevy bolt which basically a free lease in certain states like NJ with all the crazy ev credits available. Thats designed to move a effective electric transportation device with almost zero passion and drive to own. At the early stage the market research showed early adopters to be of a certain mindset. Well those people have filled their garages and now its time to motivate regular everyday americans into experiencing electric vehicles and its working..

Sales of 40 grand bolts are very strong even at zero down 225 a month 36/10 lease deals in neighboring states that are not as incentivized as NJ.

Non passionate purchases require incentives...

Marry Barra does not believe specialized vehicles such as the hummer ev will get incentives. The General would close up the brand before putting money on the hood. Wall street demands it.

Nikola was a pretty good shoot at GM built being a “tech” company like tesla until Nikola got shot in the back by the short seller claiming The CEO was a flim flam man crook.

I believe that to be genius move that GM should still move forward ..

Nikola will have more consumer admiration than cadillac even with the recent flawed news cycle release.
 
#18 ·
I sold GM's in 1994, when there was a shortage. When a Customer would ask "How much is that SLE in the Front Row?" Our reply was "Wasn't the price right on the Window Sticker?"

Much like it is getting Post Covid shut down with less than 30 Days Supply on High Sale Vehicles.

Supply and Demand, so Yes a $112K GMC might sell for $112K@List, but only to a Very Few. But much like a Ford GT, Limited Numbers.

So then the question is, How many does GM have to produce to keep the Product Line Profitable? Would the Volt or Bolt actually sell if not for the Tax Grants? Tesla has the New Cool Car Line, GMC won't.

The Volt and ELR didn't survive the Profitability Line, adding another $30K to the price tag isn't going to make the Sales Numbers go even higher. $112K is a Silverado, Bronco and a Trax.
 
#25 ·
You will have to pay a Price even without Dealers. Where do you turn when Carvana drops off a vehicle with a Recall, a Missing Emblem, a Loose Drive Shaft, a Squeak? The Company's Warranty Outlet right. Well the Company's Warranty Outlet needs to make More Profit to keep it's doors open without New Vehicle Sales Department.

You will also need to Upgrade More Often, keeping up with Technology, Reducing Normal Wear Costs, and avoiding a Car without Warranty, because Repair Costs will be through the roof.
 
#20 ·
C&D is talking about a slightly lower price for the upcoming SUV Hummer EV, around $75K to start for the cheaper models available later:

https://www.caranddriver.com/gmc/hummer-ev-suv

Coincidentally, the cover review of the new issue is about the Defender, their test vehicle is over $80K (starts +$60K). That’s with “only” 495hp vs +600hp for the base Hummers. I’ll never own one, but the Hummer pricing sounds about right.
 
#41 ·
GM is building high demand products that command msrp. Thats great to hear its sold out in ten minutes.

Hopefully the dealers wont be marking up the Hummer EV and put a bad taste in consumers mouths
 
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#51 ·
So which is good for GM

To make a profit or to make cool vehicles because I'm confused

For many years now I've sat here reading posts by members who I would describe as "fanbois" decrying everything that I've said (and others) about GM making cars for motoring enthusiasts instead of for the bean counters

"but GM has to make a profit" they said

"but GM has to cut out the un profitable divisions" they said

BUt here we have GM spending millions on what is essentially a shot in the dark and thats OK?
 
#55 ·
^^^
Yup!

Just picture this one for a hot-second; GM's ENTIRE EV Portfolio:

Chevy Bolt ~$36K (discounted upwards of $10K) and............................................... ............. GMC Hummer EV ~$120,000 (and not a penny less)

With nothing in-between?
I agree, they need more of a portfolio on the market instead of the truck, the Bolt and some promises before considering them truly serious.
 
#57 ·
^^^ I agree, they need more of a portfolio on the market instead of the truck, the Bolt and some promises before considering them truly serious.
EV1

Introduced then killed

Volt Introduced , updated and made better then killed

Bolt - Introduced and isnt it about to be killed?

Hummer......Jury is still out


Zero Zero zero is just around the corner ;)
 
#70 ·
It would have been a much better platform to work from, a Volt Based car line "Saturn" would have worked.
Short term, sure. But the electrics are taking over. In the long term you're idea relegates all the existing divisions to the scrap heap.

This reminds me of the Silverado Hybrid. Lets save the Planet with a 6.2L V8 in Sheep's Clothing.
If the goal was to save the planet through less oil consumption, that idea was quite valid. Making your existing economy cars more economical is very limited. They already ARE economical. Any fuel savings is going to be a fraction of an already low number.

If you want to minimize oil consumption, economize on the biggest guzzlers. Any fuel savings is going to be that same fraction, but of a greatly higher number. The only problem being that the truck buyers really didn't care about saving the planet.
 
#81 ·
Again. Average Household Income of a GMC Owner is $80,000. (median household income in the United States is $61,937.) Higher end, but not affluent enough.

There is just No Way a $112,000 (second) vehicle fits into a GMC Brand Buyer's budget.

Not to mention How many GMC Dealers will sign up to sell the New Hummer? Special Training and Tools will run 6 digits, for 2-4 a year doesn't compute except in affluent areas already served by Tesla/Rover/Mercedes and the likes.

I don't disagree, that the Hummer is a Cool Vehicle, it might well be worth $112,000, but it isn't going to sell as a GMC, and isn't going to sell to GM Customers
 
#82 ·
Nailed it

At 80k they are on the money - with this sort of thing you need to tell your customers that an EV isnt going to cost you heaps more than your current truck

The perception is that they are not only crazy expensive but also a compromised vehicle , range issues ect ect

New Tech is dealing with the range but as for price they needed to make it closer to a range topping ICE truck

at 80-90k they have the market

at 100-120k they lost 80% or more of their target market
 
#89 ·
In the case of the Hummer, and as the title suggests
List Price Only; NO Dealer Markups; No Incentives
Now, is this to combat the way the Mach E Launch has gone? 50000 Deposits of $500 (sold out btw) and now Dealers adding $5-15000 over MSRP.

Now, as a Dealer, I would want to make the Most Profit allowable (Consumer Wise) as soon as possible on something like the Mach E. I have no way of knowing (today) if this will be another C Max, or a Bronco. I do know that I will have to shell out mega dollars on Training, Special Tools, even Charging Stations, so Extra Mark Up while the Buzz is on is the obvious thing to do.

This is also going to be a Geographical Sales Rate, Cali being the Prime Area, Florida and Southern States, but not so much up here in Canada. -40 degrees, 3-400 mile trip to any major City, 1250 miles to cross 1 Province. So I doubt many Northern Dealers will be Signing up.
 
#111 · (Edited)
I'm conflicted on the H-EV...one one hand I love it, but OTOH I don't get it's existence. I'm of the opinion that the leadoff should've been a mass market CUV or if we really had to do a Hummer then lead off with a full size 3 row 7 pass SUV. At least then buyers at 115-120k could have something that they actually use. This thing is....actually kinda useless, cool as all hell but really useless.

This decision IMO leaves me somehow not being able to shake the feeling that the old GM mindset where they try to milk as much money out of buyers with as little product as possible is at play here...because undoubtedly a 3 row SUV would cost a little more to do, but eventually went with the the cheaper to build product and market it as something exciting enough to lure a few well to do buyers in.

Re dealer markups...Good Luck to GM enforcing this, Dodge said something of the like when the Demon came out. Not sure how they enforce pricing once it gets in the hands of the dealers. But even then, aren't they all sold out until 2025 so what are we talking about here? Unless GM knows like I do that those $100 deposits really don't mean anything.
 
#112 ·
The deposit means very little to "Take Rate" IMO. A deposit doesn't translate to a Sale Success. If the Vehicle is a Sales Success, there is a chance for a profit, if it is a flop, it's $100. It was just testing the Waters.

Real "Take Rate" is still yet to be determined. And a $112K vehicle is a strange way to debut the Ultium Platform, if it is to be a Main Stream Platform, not a Low Volume Platform. GM will carry on with $90 then $80K versions, while making and selling as many $112K units as needed.

The GT and Continental were very limited numbers, with very strict guide lines. Ford held (for 2 years) the ownerships of the chosen few who could get a GT. Now the $500K investment are selling for a cool $1M. But that is a Rear Engine somewhat exotic, much like the C8, a Pre Existing Market
 
#116 · (Edited)
A new bill to be introduced in congress. All car companies are now required to follow the "InCogKneeToe" rule: No automaker (or division therein) is allowed to market, or attempt to market, any product outside of ten percent of their mainstream average transaction price.

On notice: Chevrolet must discontinue all attempts to sell Corvettes, Suburbans, Tahoes, or Silverados. (work trucks are exempted)

Cadillac must discontinue all attempts to sell V series or Blackwing products.

GMC must discontinue entire Denali line.

And Ford, and Chrysler, etc, etc.

Maybe we could all vote on this idea? Oh, darn it, just missed election day!
 
#128 · (Edited)
Were Original Hummer Buyers concerned about Saving the Planet? Sure, they were concerned about New, Biggest, Boldest vehicles available, but that only works for a period of time. But where is Hummer Today?

Yes GM will sell a bunch of these, to start. Then they plan to reduce it's price point and Coolness Point. Cheapening it's Cool Image. Tesla has already put a Dent into "I wanna do My Part" I care about the Environment. Rivan close to putting another Dent in it for nearly 1/2 the price, followed by the F150 Hybrid. Which does more everyday things than the Coolness of the Hummer EV.

What is the Market? EV which most Consumers are treading lightly around, very few want to be limited to what their vehicles can do. Or is it Off Road? where most people won't smash around a $112K rock crawler? The Jeep/Bronco battle is cornering that market right now.

Then, throw in Technology, and how fast it gets left behind, this $112500 Hummer will be Outdated by the time GM Releases it. Or recalled for Fire Issues after they are sold.
 
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