GM Offers Discount On Hummer as Sales For Big SUVs Slide

[TXlib]

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GM Offers Discount On Hummer as Sales For Big SUVs Slide

By SHOLNN FREEMAN
Staff Reporter of THE WALL STREET JOURNAL
May 7, 2004; Page A3

DETROIT -- General Motors Corp. is for the first time offering discounted financing on its Hummer H2, the icon of the market for supersize sport-utility vehicles, amid slumping demand for large SUVs and rising gasoline prices.

After a 21% sales decline in April, GM now will offer qualified Hummer customers 2.9% rates on five-year loans. GM's move comes amid a flurry of similar actions by Detroit rivals Ford Motor Co. and DaimlerChrysler AG's Chrysler unit to ratchet up discounts on SUVs in the wake of sluggish April sales.

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It appears, as I suspected, that market forces will take care of this problem! (Unless Detroit successfully lobbies DC to grant special tax incentives to encourage buying SUVs...)

[Frederic Bastiat]

1. That and the poor engineering

The H2 has one of the worst records when it comes to product quality.

[amber dog democrat]

2. I don't see a long life for this product

Especially when gas goes to 3.00 a gallon.

[htuttle]

3. This is deja vu all over again

Does this remind anyone else of the precise situation with US carmakers between '79 and the mid 1980's?

After the US market is flooded with high-mileage Japanese hybrid cars, will Detroit come crawling to Washington begging for another bailout?

[The Backlash Cometh]

4. hee-hee

There go the resale values. I guess buying a hummer wasn't such a profitable idea afterall?

[GOPisEvil]

5. If I wanted a Tahoe, I'd buy a Tahoe...

...if I want an offroad vehicle, I'd get a Toyota 4x4 pickup.

A Hummer H2 is just a stylized, overgrown station wagon.

[radwriter0555]

6. 21% sales slump in ONE month? I thought the economy was BOOMING???

whuh hoppin?

[jmowreader]

8. The 2-gallons-per-mile fuel economy, maybe?

Ya think?

[ZenLefty]

7. There already are special tax incentives

But you probably knew that already...

http://www.taxpayer.net/TCS/whitepapers/SUVtaxbreak.htm

http://seattlepi.nwsource.com/local/104601_hummer17.shtml

In the mid-1980s, he said, Congress tightened rules about how much money can be written off on luxury automobiles used for business -- but excluded vehicles with a gross weight of 6,000 pounds or more, partly an attempt to help farmers afford tractors, large trucks and other heavy equipment.

But many SUVs, including the 6,400-pound H2, fall into that heavyweight category, and now a new class of small-business owners and the self-employed, such as construction company executives, doctors, real estate agents and lawyers, is qualifying for the deduction.