GM matches Tundra's incentives
Toyota stole GM's thunder, but The General isn't going to let Toyota take its lunch money. The Japanese company is offering grand slam incentives for the '06 and '07 Tundras that include $3,000 and interest-free loans for five years. That kind of honey moved Tundras off dealer lots with a quickness, allowing the Tundra to improve its June 2007 sales by 146.3 percent over June 2006, with 21,727 trucks sold. GM didn't expect Toyota to be offering such a sweet deal on a truck that had an all-new version introduced this year, but Paul Ballew, GM's executive director of global market analysis said, "We're evaluating our options right now."
GM does offer incentives on the '06 and '07 Silverado and Sierra, and even though sales for those two pickups declined in June, the Silverado still moved 44,955 units and the Sierra 15,187. With Yukon Denali sales up as well, GM has a mix that it believes can maintain profits, so it's not out "to match dollar for dollar," but still, it's "not going to concede ground in a category we feel we're best in class in." Ballew's final words for Toyota: "The game's on."
[Source: Auto News, sub req'd]
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Reader Comments (Page 1 of 1)
Biff Baxter 10:48AM (7/04/2007)
Wow. The Japanese resorting to rebates and cash to move product that can't fetch it's asking price.
Boy, they are really marketing genius's and worthy of all the accolades the car punditry bestows on them.
The domestic 3 should consider doing something similar, because if Toyota does it that means it's as close to perfect as you're going to get, right?
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fatty 10:59AM (7/04/2007)
you are correct, now just get in your focus and drive away.
Tyk 11:08AM (7/04/2007)
Full sized trucks and SUVs.. the last bastion of domestic dominance: Toyota can afford these rebates (to move units) much more than GM can afford to lose sales.
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MrMorix 11:24AM (7/04/2007)
This is about making money, don't believe Toyota & GM are giving rebates just out of the kindness of their hearts. I do believe GM makes more of a profit on their trucks than Toyota does.
With that being said, I'm kinda warming up to the Tundra although I still think the interior is hideous! Although I would never buy one, I think this truck has potential for the future.
VenGenzt 12:09PM (7/04/2007)
GM had a chance to crush Toyota by going head-to-head with Toyota when this incentive war started with Toyota. Instead, GM just got crushed with this months sales reports showing Toyota up and GM down. Why was GM down..TRUCKS!
This exemplifies Americas inability to compete anymore: they sit on their asses and get their head beat in by war of perception. When are they gonna learn that they aren't going to get their image out of the 'shitter' until they can crush them at their own game. Frig, Toyota played GM's game with incentives and came out looking better for it with a truck that is was a potential nightmare. Even with incentives, recalls, overruns, etc. Toyota still wins.
Who is running these companies?
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Biff Baxter 2:41PM (7/04/2007)
Let me get this straight.....GM doesn't need to offer truck rebates but should anyways because they need to respond to Toyota who began offering them right out of the gate due to poor Tundra sales. Toyota is hailed as a marketing genius.
On the other hand, GM offers rebates on a car or truck line and they are ridiculed as having to resort to money-back schemes in order to sell crap vehicles?
Yeah, that just about sums it up.
Stratojet 10:07AM (7/05/2007)
The end result of this nonsesnse is this:
If you offer those huge rebates on a Truck that is supposed to be a milestone for Toyota, it means this:
- The Truck is not priced correctly; the market do not want to pay the premium for the product: therefore, the perceived resale value of the Tundra is lower at this point
- Toyota, without a big fanfare, is now more present in fleet and is offering rebates. Big rebates that is.
- The Tundra has some major reliability issues with the engine. This, with the large incentives, will affect the residual value.
- The interior of the Tundra is not up to what we used to see on the other preoducts. In fact , it looks botched and very plasticy.
True, they can afford the rebates; customer will now wait until Toyota offers other rebates when the new models will be out. You can't win at this game. To perceive Toyota as geniuses is far fetched. Wagoner used to tell the other manufacturers to stop whining and get in the game (rebates of course , just after 9/11). When you do this, you just shovel your problems ahead.
Needless to say what the end of the story will be if Toyota keeps on doing this.
KJC 3:17PM (7/04/2007)
Note to GM, Toyota is not messin around they are after the last strong hold of your shrinking market share.
Nothing wrong with offering incentives on the Tundra usually not on a new model but noting the extreme predice against Toyota this is a good move to get their truck among the public.
More importantly is are the Tundra buyers coming from Ford, GM, and Dodge or repeat Toyota customers.
Ford has had 0% apr for 5yrs on their F150
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Devin 5:17PM (7/04/2007)
The people in this post who are saying that GM should have offered more incentives on it's full size trucks like Toyota did are the same people who constantly ridicule GM for offering rebates just to move iron. Personally, I think GM should keep nearly no incentives on their trucks for now, because once consumers get used to 3k, they are gonna want more, until GM is losing money just to say that they sold x number of units.
GM really has nothing to worry about with the Tundra. If GM wanted the fastest truck off the line and the truck with the most hp, they could easily do it. But they know that the consumer doesn't really care if their truck of all things is a track star.
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Devin 5:22PM (7/04/2007)
Yeah, and Ford's F150 has been out for 4 years.
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maas oyama 5:30PM (7/04/2007)
As expected GM has tumbled headfirst into a trap that was deliberately laid down by Toyota.
Now it is a straightforward slogging match between a company that has $60 billion in liquid cash vs another that has $360 billion in debt.
And it does not require a very high IQ to figure out who will win
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Barney 5:42PM (7/04/2007)
Is everyone forgetting the "employee discounts" given to buyers? I don't recall it was Toyota offering that deal. No price at a dealership is firm. Rebates only apply after the deal is done and the buyer has to pay for it first. Getting $1 back still means the finance charges are paying for it. Is the barter system dead now?
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aSHIRTandTIEguy 6:36PM (7/04/2007)
It does not matter what is happening with incentives on GMCs, Toyotas Dodge's or the Nissan Thing that no one buys! It's F-150 land and it is pretty obvious it will always be unless Ford just stops making F-150's. And then customers would buy used F-150's. Basically what would of happened if the Mustang would of been stopped in 1993! Kinda like Honda Civic's, it's the car to compare everything to in the category, same at the F-150.
It should not be what Toyota is doing to GM or vice versa. It is what everyone is trying to do to steal away a F-150 sale from Ford! Why does the competition continually embarrass themselves by releasing trucks that are not half as good as a Ford F-150? The competition should try and make a truck better then the Ranger. That won't be to hard at all! Then they will gain sales (or not :S) . Just like how Ford forgot about the Taurus and the Camary-Accord is now better. Ford forgot about the Crown Vic and the Avalon is better and now the Explorer is going to be forgotten, and hopefully not until Land Rover makes a more reliable SUV!
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Bruno 11:28PM (7/04/2007)
Hey, it's good old fashioned competition. They're bidding for our business. We win. From what I've read these trucks are already fabulously profitable, they are just having to cut some off the top to make the sales. The Ford/GM/Chrysler problem is not in truck sales, it's in the poor performance in cars that the truck/suv business has long kept afloat. Truck sales are still great. They're just not as great as in the past. Nothing lasts forever. Adapt or die.
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KT 10:47PM (7/04/2007)
Moron wrote..."GM had a chance to crush Toyota by going head-to-head with Toyota when this incentive war started with Toyota. Instead, GM just got crushed with this months sales reports showing Toyota up and GM down. Why was GM down..TRUCKS!..."
Do you just look at the percent up or down when you look at the sales results? How about looking at the total number sold. Toyota is up each month but are still selling less overall than GM or Ford. They are up from the sales of the previous year for that month. Look how few they sold they sold the year before and compare that to what GM sold the year before. Not close!
Don't be such a blind thoughtless lemming fanboy. I'm embarrassed for you.
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Drew 9:58PM (7/05/2007)
This thread, and most folks here are amazing. The people that are buying into the marketing machine generating value through units sold is truly sad.
Now for the real world. A business, any business, is judged on percenatge growth (vertically and horizontally), profitablity (net not gross), cash flow, and brand equity.
Now, using that criteria, judge the manufacturers as a whole, and then by division or platform you will see the real picture. All we are is the target market, or their prospect universe from which to move the units. The incintive wars are irrelevant. The total units sold is completely irrelevant. It all boils down to the financial performance on the income statement and balance sheet. IF you have 10 billion in working capital or in the budget for the launch and incentives of a new product, then lucky you. Toyota's objective at this time is market penetration. Period. They have the budget to do it. Period. And the GROWTH numbers show that they are doing it successfully, PERIOD!
Fact is, GM and Ford are in trouble for how they operate the business. THe current business model is not sustainable without change in expenses. The result, we get the half-assed products they produce due to budget limitations from the bean counters who's ass is on the line.
Now before all you folks start throwing bombs at me for being anti-american or a Toyota lover, I just purchased a 2007 Silverado Crew Cab LTZ. But I sure don't get on to forums because of my ideology or brand preference and start screaming at people that Chevy rules the world.
Wake up people. All any of you are is the target market for the products, nothing more or less. And the big three are self distructing, one at a time, while the imports gobble up market share. Sad indeed.
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Wayne 9:58PM (7/09/2007)
Recently drove both the new GMC Sierra and Tundra. GMC has a much improved vehicle. Tundra performs better than GMC or Ford, but as a writer commented earlier the interior is not par with Ford or GM.
I believe when the 09 F150 arrives next year GM, Toyota, Dodge, Nissan, and the other manufacturers will have a competitor like they have ever seen before.
Give Toyota five years and they will have the best truck-period!
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