Find Reviews by Make:
| 1. Chrysler Group | $4,584 | +18% |
| 2. GM | $3,796 | +6% |
| 3. Ford Motor Co. | $3,451 | +2% |
| 4. Hyundai-Kia | $2,998 | +40% |
| Industry Average |
$2,835 | +10% |
| 5. Nissan North America | $2,511 | +19% |
| 6. Toyota Motor Sales | $1,620 | +22% |
| 7. American Honda | $1,310 | +9% |
Through September, as calculated by Edmunds [via Automotive News [sub]]
So with Hyundai, does this mean that they are buying market share with incentives? Or does it mean that the market has moved towards them and their number of incentives has increased?
I’m not crystal clear on your article here. I’m assuming you are saying companies have increased the amounts of $ incentives by this amount since January 1? Or am I wrong?
When you add the Fed’s CARS/C4C “incentive” into the mix, the numbers are astounding.
With further reflection, it seems that Hyundai is not necessarily buying market share but stepping up to the plate and being more competitive with incentives than they were earlier in the year.
They aren’t much higher than the industry average now.
Plus having seen their phenomenal growth, I’m going to be bold and surmise that the market has moved towards Hyundai-Kia.
Kind of reminds me of the Great Depression, when people who’d purchased big luxury cars moved downscale to new “common” cars (so they didn’t get apples thrown at them in the streets by the masses of unemployed, presumably)
No-haggle pricing would make all those numbers go to zero, and then maybe I’d begin to trust new car dealers a little bit more. The higher the incentive, the greater my mistrust of what the “real” price is.
Incentives are the little secret that auto marketing doesn’t like to talk about, because it is a very clear price capitulation. It’s admiting that the price is too high for the market.
When the cars are still not selling, we probably need an incentive on top of the incentive, because the price is still very clearly above what the market is able or willing to pay.
In any event, incentives tell only part of the story. We need to net them against the increase in MSRP (or in many cases, the total of multiple MSRP increases) over the last year.
This makes Ford’s performance all the more impressive this year. They are performing better than the industry average in sales and are way below industry average on incentive increase. It would be nice to pull the per-car figure down, however. Still, only juicing them 2% this year is an accomplishment, given the result.
The opposite is true for Chrysler.
Numbers would be more representative if they included increase/decrease in average MSRP next to the incentive numbers (if those numbers are available)
Change:
1) Chrysler +$699
2) GM +$215
3) Ford +$68
4) Hyundai +$857
5) Nissan +$401
6) Toyota +$292
7) Honda +$108
Nearly $1000/unit is pretty mindboggling… especially considering this is on cars & CUVs and not a full SUV & truck line that is probably forcing GM, Nissan, and Toyota’s hand.
From the title of this piece, it would appear to be the average for the year so far – and it has been a horrible year! What would be more interesting would be a graph of the incentives for each manufacturer month by month. I suspect that current incentives are nowhere near those listed.
I’d like to know if these numbers include dealer hold back cash or other “quiet money” from the manufacturer.
Being the realist I believe myself to be, I’d be surprised if incentives don’t increase, nearly across the board, soon.
The manufacturers need to pump up the volume, but dealers are loathe to take on excess inventory.
The manufacturer always wins.
I think that some careful analysis is needed with these figures….
It’s true that GM is only up 6% and Toyota is up 22% but that may be because GM was already giving a large incentive and Toyota wasn’t giving any.
GM is (if I’m reading this right) giving an average of $3,796 per vehicle.
Toyota is giving (again, if I’m reading this right) an average of $1,620 per vehiclde.
So, GM is giving out about 57% more than Toyota.
Ford is only up 2% but they’re still giving out $3451 which is 53% more than Toyota.
Hyundai is the most interesting: Up more than 40% AND 46% more than Toyota.
For all the talk about how wonderfully Hyundai has been doing, and how much bigger their profit margin is than Japan’s you have to wonder if there is really an average of $2,998 in each car that they can give up and still make a profit.
@ohsnapback,
The figures include both consumer and dealer incentives. The standard dealer holdback percentage is not considered an incentive, though, but part of the dealer’s standard margin.
Incentives by the luxury car makers have to dwarf any shown here. Click on bmwusa.com and compare the “special offer” leases (always) available to what comes up with (presumably) non-subvented leases on the “estimate payments” page. The differences can exceed $10,000 over 36 mos.. On top of a number of models with thousands on the hood ($6K on a brand new 7 series anyone? Anyone?)
Or take Porsche. Please. Last month ’09 911’s were available for $20K off on Carrera’s, $25K on Carrera S models. Those are asking prices. Before negotiations. Oh and 60 month financing at 1.9% (BMW has that too if the lease deals don’t do it for you). Porsche leases were at a money factor of .00145 with .58 residuals on 36 months. We’re talking $750/month leases on cars with $90K stickers. Do the math; you can’t without way over $10K incentives from der Faderland.
If you want to buy anything (except maybe gold), 2009 remains the greatest year in memory to do it.
SOF, Edmunds reports incentive spending by month. During September ’09, GM’s average incentive was $3,769, Hyundai’s was $1,913 and Honda, $931. Industry average was $2,557.
As Ronin said, incentives represent price capitulation but tell only part of the story. Also, the non-publicized dealer incentives further confuse uninformed consumers about the profit margin. Dealer incentives are only partially effective in stimulating demand because a typical buyer doesn’t know the final price can go even lower than MSRP minus customer rebate. Honda showrooms probably draw many fewer prospects because Honda relies so heavily on undisclosed incentives. I’d be a lot more likely to endure the Daniel-In-Lions-Den car buying experience if I knew, say, Acuras are on sale for $2,500 off rather than $1,000.
The marketplace is a bazaar, and caveat emptor.
Aren’t Ford, GM and Chrysler numbers skewed by high margin high volume high dollar truck rebates?
Hyundai is giving away the farm1 Especially since the average transaction price is most lokely thousands less that GM, Ford, Toyota. Guess they are trying to get as much as they can before owners realize what junk they bought…
@mtymsi: “Aren’t Ford, GM and Chrysler numbers skewed by high margin high volume high dollar truck rebates?”
So are Toyota’s.
There is $10000 rebate Mercedes Benz 2009 E class. That is five times as much as a average Hyundai.
But Toyota doesn’t sell nearly the full size pickup truck volume GM, Ford and Chrysler do.
and I’ll bet that 10 yr warranty costs Hyundai a pretty penny too.
Pretty sobering.
Yeah, the fact Hyundai and Kia is putting that much on the hood is telling.
I arrived home yesterday and the Kia dealership we had purchased our Sedona from had left a message wanting us to come in and letting us know they have up to $3k on the hood and could probably get us a better payment than we have(had) on the Sedona. If he had called while I was there he would have had an earful after the crap service and the number of times the damn thing had to go into the shop. Never again will anyone in my family buy a Hyundai or a Kia.
I’m glad someone finally posted this information. I’d been getting tired of the “Hyundai/Kia are kicking butt” hype going on because they went from selling 30000 cars/month to 35000 cars/month. It’s easy to sell cars when you have a Buy One Get One Free sale like the Kia dealer in my area had a few months ago.
That being said, Toyota won’t nearly be as low by the end of the year once that 1 billion dollars in increased advertising and incentives over October to December kicks in.