Porsche CEO opens up a can over "stupid incentive war"

Porsche CEO Peter Schwarzenbauer is about to open up his special brand of wup ass over the heavy incentive spending of the Big 2 and the Chrysler Group. He says the U.S. auto industry is "trapped in a death spiral" because of its dependence on incentives, and blames large automakers like General Motors, Ford and the Chrysler Group for not being able to better forecast the market and the manage supply and demand of their inventories. Large remaining inventories of last year's models are usually what spark incentive spending, as older vehicles need to be sold to make room for new ones. In the past few years at least, the Big 2 and Chrysler have overestimated demand for their vehicles and turned to crafty incentive deals to clear their lots.
Porsche, however, has a no-incentives policy, which it can maintain since it sells a much smaller number of vehicles. Schwarzenbauer admits his company's size is an advantage, but still won't let the rest of the industry off the hook. He forecasts that the entire industry will be damaged by heaving incentive spending eventually, but doesn't go into exactly how.

Edmunds reports that incentives spending actually went down last month by 15% compared to July. Porsche shows up as spending the second lowest amount on incentives per vehicle, around $538, since Edmunds records all types of incentives. Scion spends the least at $74, and you could almost buy a second car with the amount that Jaguar, the biggest incentives spender, shells out per vehicle: $8,447.

[Source: Ward's Auto]

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