Chrysler to drop employee pricing gauntlet first

General Motors might be sticking to its guns regarding value pricing, but industry insiders say that Chrysler is all about being the one to start the incentives war this summer. The pileup of 2006 vehicles resulting from Chrysler's decision not to cut production for fear of investor backlash has dealers fuming and dealer lots overflowing with excess. As a result, the automaker will reportedly be the first to drink the Kool-Aid that is summer 2006 employee pricing.

The incentives will save consumers thousands of dollars on the price of a new car, but could put tremendous pressure on Ford Motor Company and General Motors. Last year, employee pricing programs were considered to be more successful in pulling forward sales than making conquests, and after the dust settled, the three U.S. automakers experienced the rough hangover of low sales throughout the winter months.

[Source: Reuters via ABC News]