GM states that the price increases are designed "to recover a portion of GM's increased commodity costs, increased content and fuel-economy technology." While not discussing specific price increases on individual models, they did say that "the average increase is just over $1,000." It's known as passing on increased costs to consumers, and it's a long established business practice. That's what GM is doing here. One might also liken it to the domino theory, or even passing the buck. Well, at least the 0% financing for 72 months news is good...
Full story here.
Here's Inside Line's take: GM Hiking Prices on '09 Models, Offering Zero-Percent Financing on '08s
Here's AutoObserver's take: GM Launches 0% Financing for 72 Months; Cuts More Production
Here's Inside Line's take: GM Hiking Prices on '09 Models, Offering Zero-Percent Financing on '08s
Here's AutoObserver's take: GM Launches 0% Financing for 72 Months; Cuts More Production
bepperb says:
06:19 AM, 06/24/08
So, is GM announcing increased prices in '09 as a way to push more '08's? Because if they raise their prices 1k on all their cars, and no one else does, of course their already declining sales will completely tank. Perhaps rebates are going to make a comeback at the General a month or two into '09?
stovt001 says:
08:45 PM, 06/24/08
Everyone else has already raised their prices. This isn't just GM. GM's competitors are still more expensive, and just as they're closing the quality gap, they're correspondingly closing the pricing gap.
I got my Cobalt on 0% financing for 72 months. With no down payment (obviously wiser to keep the money in the bank earning interest) I'm almost right side up less than 2 years later and with inflation so high my effective interest rate is actually negative. Woohoo!
estreka says:
05:25 AM, 06/25/08
72 months!? Geez, car loans are getting huge. Either ppl are paying huge interest rates or the avg price of vehicles has gone up (or both). Live within your means, people.
brn says:
08:43 AM, 06/25/08
estreka, maybe vehicles are now lasting long enough that it makes sense to go for longer loan terms (especially at 0%).
On the other side, I personally would go crazy with a loan that long.
stovt001 says:
07:11 AM, 06/26/08
A 72 month loan is uncomfortably long. If it wasn't for 0% financing I wouldn't go above 4 years. With a more traditional 4 year loan with 10-20% down you'd be rightside up in under a year, depending on depreciation. With my car, after two years I'm still upside down. Luckily the increased demand for small cars has pretty much stopped the depreciation on the car so I'll be rightside up faster. Psychologically its rough, but when you think about it with inflation factored in (a big factor in this economy) my interest rate is negative, so its worth the tradeoff.
ateixeira says:
12:24 PM, 06/30/08
Too bad you can't get 0% financing for a tank of gas. ;)