Envoy Fan
02-21-2005, 11:37 PM
Monday, February 21, 2005
A sticker shocker: GM slashes prices
By Chris Woodyard / USA TODAY
LOS ANGELES -- General Motors has taken the unusual step of quietly lowering sticker prices by up to $2,000 on some of its most popular SUVs after a sudden sales slip.
Earlier this month, GM knocked $1,500 off the manufacturer's suggested retail prices of its midsize SUV lineup -- Chevrolet TrailBlazer, GMC Envoy and Buick Rainier -- and $2,000 off most extended versions.
Among them was the Envoy XUV, with a sliding roof panel, which GM plans to quit making.
Sticker prices also were cut by $750 on two full-size pickups, GMC Sierra and Chevrolet Silverado 1500 regular-cab Fleetside work truck.
GM didn't announce any of the changes. Incentives, which can deduct another $2,000 off the price of the midsize SUVs, were left intact.
"This is part of an effort to remain competitive," says company spokeswoman Deborah Silverman.
GM's midsize SUV segment was battered in January. TrailBlazer sales fell 46% compared with January 2004. Envoy sales were off 52% and Rainier 27%, Autodata reports. By contrast, midsize model sales from all manufacturers fell 24%.
Slipping sales were in contrast to modest sales gains for all of 2004 vs. 2003.
Price cuts in the middle of a model production year are considered "extremely unusual," says Mark McCready, pricing expert for CarsDirect.com, a Web site for auto buyers.
Unlike slapping on more incentives, slashing sticker prices requires changing financing arrangements on the unsold vehicles, he says. And every new SUV, whether on storage lots or in dealer showrooms, has to have a new sticker pasted on the window.
"I think GM has gotten some feedback that shoppers might be taking them off their list even before a test drive because of their sticker prices," McCready says.
Midsize SUVs remain popular, but GM has been hurt by "increasing competition, from the domestics and the Japanese," says Mike Chung, pricing analyst for Edmunds.com, another auto site.
With the price cuts, the most basic TrailBlazer is now priced below Ford Explorer, Dodge Durango, Honda Pilot and Toyota 4Runner. It's still above the new Nissan Pathfinder, though, in the increasingly crowded field.
Rivals aren't worried. "We span such a large price range," says Ford Motor spokesman Dave Reuter about the Explorer.
And given that Chrysler lowered the Durango's price when the new model was brought out two years ago, "We don't feel like we need to do anything" in response to GM, says Chrysler spokesman Kevin McCormick.
A sticker shocker: GM slashes prices
By Chris Woodyard / USA TODAY
LOS ANGELES -- General Motors has taken the unusual step of quietly lowering sticker prices by up to $2,000 on some of its most popular SUVs after a sudden sales slip.
Earlier this month, GM knocked $1,500 off the manufacturer's suggested retail prices of its midsize SUV lineup -- Chevrolet TrailBlazer, GMC Envoy and Buick Rainier -- and $2,000 off most extended versions.
Among them was the Envoy XUV, with a sliding roof panel, which GM plans to quit making.
Sticker prices also were cut by $750 on two full-size pickups, GMC Sierra and Chevrolet Silverado 1500 regular-cab Fleetside work truck.
GM didn't announce any of the changes. Incentives, which can deduct another $2,000 off the price of the midsize SUVs, were left intact.
"This is part of an effort to remain competitive," says company spokeswoman Deborah Silverman.
GM's midsize SUV segment was battered in January. TrailBlazer sales fell 46% compared with January 2004. Envoy sales were off 52% and Rainier 27%, Autodata reports. By contrast, midsize model sales from all manufacturers fell 24%.
Slipping sales were in contrast to modest sales gains for all of 2004 vs. 2003.
Price cuts in the middle of a model production year are considered "extremely unusual," says Mark McCready, pricing expert for CarsDirect.com, a Web site for auto buyers.
Unlike slapping on more incentives, slashing sticker prices requires changing financing arrangements on the unsold vehicles, he says. And every new SUV, whether on storage lots or in dealer showrooms, has to have a new sticker pasted on the window.
"I think GM has gotten some feedback that shoppers might be taking them off their list even before a test drive because of their sticker prices," McCready says.
Midsize SUVs remain popular, but GM has been hurt by "increasing competition, from the domestics and the Japanese," says Mike Chung, pricing analyst for Edmunds.com, another auto site.
With the price cuts, the most basic TrailBlazer is now priced below Ford Explorer, Dodge Durango, Honda Pilot and Toyota 4Runner. It's still above the new Nissan Pathfinder, though, in the increasingly crowded field.
Rivals aren't worried. "We span such a large price range," says Ford Motor spokesman Dave Reuter about the Explorer.
And given that Chrysler lowered the Durango's price when the new model was brought out two years ago, "We don't feel like we need to do anything" in response to GM, says Chrysler spokesman Kevin McCormick.