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post #1 of 4 (permalink) Old 08-20-2004, 06:17 PM Thread Starter
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GM faces slowdown in dealer orders

From Automotive News:
GM faces slowdown in dealer orders

Reuters / August 20, 2004

NEW YORK -- Some big automotive retailers and car dealerships are cutting back their orders for General Motors' 2005 models, potentially reducing the automaker's North American production and profits in coming months, the Wall Street Journal said on Friday.

The dealers have too many unsold vehicles and worry that big discounts will not attract buyers, as U.S. job growth slows and fuel prices stay high, the newspaper said.

B.B. Hollingsworth, chief executive of Houston-based Group 1 Automotive Inc., which has 91 dealerships, told the newspaper: "We are being very cautious scaling back our 2005 orders to clear out our long position on these 2004 models with big incentives."

GM, based in Detroit, told the newspaper it has not noticed a big reduction in ordering activity.

But Paul Ballew, GM's executive director for market and industry analysis, said GM is cutting North American production this quarter by 5 percent from a year earlier.

"We don't see it as (a challenge) that is unmanageable," he told the newspaper.

GM is trying to reduce a near record high 1 million-plus inventory of unsold vehicles.

Earlier this month, it raised incentives to as much as $2,500 on most new 2005 models for consumers who finance vehicles through its General Motors Acceptance Corp. finance arm. It also announced incentives as high as $5,000 on 2004 model cars and $6,000 on 2004 model trucks.

Lower production might hurt GM's bottom line because the automaker books revenue and profit when it builds vehicles and ships them to dealers, not when customers buy them, the newspaper said.
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post #2 of 4 (permalink) Old 08-20-2004, 08:39 PM
 
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I don't get it. The Mopar forums all love to post every little thing they can that sheds negative light on other car makers. I grew up seeing it in the Mopar magazines that I always read. I just don't get it I guess, being a brand-neutral kind of guy. The Ford and GM sites I frequent don't do that. The Ford and GM magazines I always read didn't do it either, except for some tongue and cheek jokes. I've always said it was sort of like a "little brother" syndrome.
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post #3 of 4 (permalink) Old 08-20-2004, 08:45 PM
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Quote:
Originally Posted by Operator
I don't get it. The Mopar forums all love to post every little thing they can that sheds negative light on other car makers. I grew up seeing it in the Mopar magazines that I always read. I just don't get it I guess, being a brand-neutral kind of guy. The Ford and GM sites I frequent don't do that. The Ford and GM magazines I always read didn't do it either, except for some tongue and cheek jokes. I've always said it was sort of like a "little brother" syndrome.

Since this is general news that everyone knows, I'm sure that noone is digging that hard to find this. Also it's good and bad news for all companies, including Chrysler.

Last edited by frost5466; 08-20-2004 at 08:58 PM.
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post #4 of 4 (permalink) Old 08-21-2004, 02:27 PM Thread Starter
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Quote:
Originally Posted by Operator
I don't get it. The Mopar forums all love to post every little thing they can that sheds negative light on other car makers. I grew up seeing it in the Mopar magazines that I always read. I just don't get it I guess, being a brand-neutral kind of guy. The Ford and GM sites I frequent don't do that. The Ford and GM magazines I always read didn't do it either, except for some tongue and cheek jokes. I've always said it was sort of like a "little brother" syndrome.
I'm not being negative. It's just news. If it was the entire article from the WSJ you'd really be upset. Gm is screwing up royally and their mistakes are having a profund impact on the auto industry right now. Similar to the price wars of the 50's with Ford vs. Gm which in essence killed several manufacturer's and weakened several others.

Even the imports are adding incentives and dealer cash to move vehicles.

Notwithstanding the incentives / rebates / push ahead sales that have killed the resale value of most cars.

Even the import makes resale percentages are dropping.

I'm not saying everything is GM's fault but they still have a huge impact on the industry. This time Ford appears to be the one who is taking the brunt.

Still waiting for Lutz to make his impact. So far, virtually all their new models
are suffering. The Aztec has outsold the GTO by a 3 to 1 margin so far.

As for his magic, I just don't see it at GM.

Maybe in the future but surely not now.
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