Incentives for clunkers
by August 4, 2009 7:29 am 57 views
Edmunds.com is reporting that the estimated average auto manufacturer incentive per vehicle sold in the U.S. during July was $2,735, down 3.4% from July 2008 and down 4.7% from June 2009. It’s the fourth consecutive month for incentive value declines.
“Comparing June with July, incentives usually increase between $50 and $200 per car sold, but this year they are down $134 per car,” Jessica Caldwell, manager of pricing and industry analysis for Edmunds.com, said in a statement. “The Cash for Clunkers frenzy has given automakers the opportunity to reduce their own investment in creating sales momentum, and to maximize profitability in the process.”
Edmunds is also reporting that it’s possible the problem with Cash for Clunkers will be available replacement cars rather than enough federal money.
“Automakers cut production earlier this year to deal with lower sales volumes, not anticipating this sales activity midway through the year,” Michelle Krebs, senior editor of Edmunds’ AutoObserver.com, noted in the statement. “Which will run out first – clunker money or the replacement cars people want to buy?”
Following is a breakdown of the incentive numbers, according to Edmunds.com.
• Combined incentives spending for domestic manufacturers averaged $3,743 per vehicle sold in July 2009, up from $3,727 in June 2009. From June 2009 to July 2009, European automakers increased incentives spending by $282 to $3,504 per vehicle sold; Japanese automakers decreased incentives spending by $153 to $1,591 per vehicle sold; and Korean automakers decreased incentives spending by $136 to $2,927 per vehicle sold.
• In July 2009, the industry’s aggregate incentive spending is estimated to have totaled approximately $2.6 billion, up 5.6 percent from June 2009. Chrysler, Ford and General Motors spent an aggregate of $1.5 billion, or 56.6 percent of the total; Japanese manufacturers spent $640 million, or 24.5 percent; European manufacturers spent $275 million, or 10.5 percent; and Korean manufacturers spent $217 million, or 8.3 percent.
• Comparing all brands, in July Scion spent $294 followed by smart at $394 per vehicle sold. At the other end of the spectrum, Cadillac spent the most, $6,165, followed by HUMMER at $5,891 per vehicle sold. Relative to their vehicle prices, Pontiac and Hyundai spent the most, 18.9 percent and 15.9 percent of sticker price, respectively; while Scion spent 1.7 and Lexus spent 2.7 percent.