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Summer Car Sales Start to Sizzle

By Joe Benton
ConsumerAffairs.com

June 26, 2007

Two of the biggest deals identifed by Consumer Reports magazine offer potential savings of up to 30 percent off the sticker price of a Jeep Liberty Sport 4WD, and up to 29 percent off a fun-to-drive Ford Focus ZX4 SES sedan.

General Motors will offer zero-percent financing for three years with an additional $1,000 cash-back on select vehicles as it tries to boost sales at the end of the month.

But the offer is only good for buyers GM considers to be “qualified.”

The discount program will be available on select Chevrolet, Buick, Pontiac and GMC vehicles and runs from June 26 through July 9.

The vehicles include 2006 and 2007 models of the Chevrolet HHR, Tahoe and Silverado, the Buick Lacrosse and Lucerne, the Pontiac G5 and G6, and the GMC Envoy, Yukon and Denali.

Ford Motor Co. is expected to announce a new incentive program this week as well.

Both GM and Ford have held incentive spending largely flat this year as part of an attempt to move away from the kind of sales and volatile monthly tallies that dogged results for the Detroit automakers for the last several years.

U.S. automakers typically offer big consumer incentives in the summer months just as they are working down inventory levels in anticipation of a new year of model launches beginning in the fall.

Detroit's automakers have been struggling to hold their retail market share amid near record-high gasoline prices, a weak housing market and fierce competition from Japanese rivals led by Toyota Motor Corp. -

Toyota, meanwhile, has announced a rebate of up to $3,500 on the new Tundra pickup truck.

Not all the savings are obvious to consumers. For example, Acura is offering a $3,500 incentive to dealers on the 2007 Acura RL with Navigation. Because dealer incentives are not typically communicated to consumers, this luxury sedan has more negotiation room than it may appear.

The Consumer Reports Bottom Line Price factors such hidden dealer incentives and holdbacks, in addition to rebates and invoice price, to identify a good starting point for your negotiations. Right now on the RL, the Bottom Line Price shows a total potential savings of up to $9,188.

CR experts warn, however, that a great price isn't necessarily a good deal if the vehicle doesn't measure up.

That is why each vehicle on the Consumer Reports' Best New Car Deals list has received the organization's coveted Recommended rating. To be recommended, a vehicle must have performed well in testing, received average or better reliability ratings, and performed well in government or insurance industry crash and rollover tests, if tested.

Sales Sluggish

U.S. auto sales rose just under 1 percent in May, adjusted for an extra selling day. On the same basis, GM's sales rose 6 percent, while Ford's sales fell 10 percent.

GM's average incentive spend per vehicle through May this year was $2,775, up slightly from $2,704 a year earlier, according to an estimate by industry tracking firm Edmunds.Com.

Ford's average was $3,084, down slightly from $3,131 a year earlier.

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