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GM Gives Dealers $500 Discounts Coupons

2504 Views 8 Replies 9 Participants Last post by  09W
The latest innovation in incentives is a $500 coupon General Motors dealers can use to close tough sales. GM dealers can apply as many as two "instant value coupons" to a transaction.

Although the automaker is reluctant to disclose details, GM says it issues the coupons on selected models.

The number of coupons dealers receive depends on several factors, including their sales history. The latter element causes some dealers to complain of unfairness in the program.

The coupons give dealers greater bargaining power in an intensely competitive market. Spiraling incentives have raised customer expectations of big rebates, dealers say.

Closing tool

"The purpose of the program is to provide a closing tool for dealers that they can use selectively," says GM spokesman Deborah Silverman. "The decision on which vehicles to offer coupons is based on the same factors we use in all other incentive programs - the competitive landscape, market conditions, sales rates, other elements of our marketing efforts."

In the past few months, Chevrolet dealers have gotten instant value coupons for the Silverado and Avalanche.

"I like it," says Carter Myers III, CEO of Carter Myers Automotive in Charlottesville, Va. "We might get 10 of the coupons (in a month), and we can use them however we want to."

Dan Holder, sales manager of Bill Heard Chevrolet in Atlanta, says the coupons can be effective closing tools.

"Let's say you are $500 away from what the customer wants for the trade-in," Holder says. "You can give him the $500 and throw a coupon in the deal."

But some dealers gripe that GM's coupon program is unfair because it is based on sales history rather than assigning a flat amount per model.

Holder says his urban dealership sells 15 to 20 Silverados a month. Some rival dealers in suburban and rural communities outside Atlanta sell 150 or more of the trucks monthly.

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Anything to move the cars...
It'll go this way.
The incentives will become public and every customer will think that the dealers have an unlimited supply or they will be hoarding them for use with "favored" customers.
So, every customer will think that they must hold out for a better deal and will use the fact that the dealer has pulled it out of his pocket as a sign that he has the lowest possible price. If the dealer has run out of coupons, the customer will not believe the salesman so some rough feelings may be created.
Sounds like a poor move on GM's part.
So when are these "coupons" going to be available until? Is this just something for the last few days of June or do you think they will be sticking around for a while? Also are they only available on Chevy Trucks or across GM... Saab, Saturn, and Hummer too?
This is old news - GM has had this for over 2 years, but it was never actually diclosed to the general public. The internal ad campigan is: "GM in your Driveway" - again it was for select dealerships, but useful for ANY model. My dealer has been offering me one for the past year on any new chevy truck or suv of my choice + all the avalabile rebates. So far Ive passed on the deal - nice not having a truck payment.
I think it's a good idea, i6t will help GM and Dealers sell the cars maybe if somebody thinks a price is to high on a car. jUST THROW IN A COUPON AND MAYBE THEY WILL GO FOR IT THEN.
Originally posted by jphil@Jun 28 2004, 07:18 PM
This is old news - GM has had this for over 2 years, but it was never actually diclosed to the general public. The internal ad campigan is: "GM in your Driveway" - again it was for select dealerships, but useful for ANY model.
This has nothing to do with the In The Driveway program, which offers GM Supplier pricing from a sponsoring GM employee to a retail customer.
From the dealers' perspective...

The "Value Coupons" serve multiple purposes. First, it motivates dealers to make close deals in order to earn more. Second, it -definitely- provides dealers with closing tools they need. Third, and somewhat dubiously, it provides dealerships with additional advertising power (e.g. in the fine print, "includes value certificates") on a first-come/first-serve basis. Fourth, in relation to the first-come/first-serve, and to the closing tools, it helps dealerships to earn business in the beginning of the month, where sales are typically slower.

At any rate, one $500 certificate is worth barely $8 a month on a 60 month, 0% new vehicle lein, so it's not that huge of a deal.

Get the vehicle you want, make sure that the price and payments are fair, and make sure that your salesperson is competent and knowledgeable, and you'll be happy.

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