To counter unexpectedly weak demand, General Motors is extending the same discounts enjoyed by its employees to all buyers of its cars. The decision reverses a two-year effort to eliminate
employee-prices-for-everyone schemes.
The new deals cover almost all 2008 models and some 2009 models. The offer typically cuts 10-12% off a vehicle's sticker price.
Incentives seldom fail to bring more buyers into car dealerships. However, they cause significant long-term damage to manufacturers by lowering vehicles' trade-in values and denting the image of
their brands. GM's sales are down by 27% in the year through July.
Read the whole story at Financial Times »