Constant discounting hurting domestic automakers?

[Deleted deleted]

Saw this article on MSNBC... to quote the Toyota spokesman:



Toyota Motor Corp. spokesman Xavier Dominicis confirmed Wednesday the company has no plans to match the Big Three’s discount program. Toyota sales were up 10 percent in June.



“Our outlook is a long-term outlook, and we’re seeking sustainable growth,” Dominicis said. “Toyota buyers tend not to be the deal-of-the-day buyers. There’s a lot of loyalty when you look at our buyers.”



I'd have to agree with that statement. Buyer loyalty is more important than finding the "bluelight" special at K-Mart. After 2 years of ownership of my first Toyota, I'd definitely consider buying another one when I'm ready to buy again.



Do you guys think "employee pricing" is going to hurt the Big 3 automakers?

 

[Frank Marano]

it can not hurt them any worse then they are. They did it to themselves, making more cars then they sold. Now they just need to move inventory so they have more room for new models.

 

[Tom Schindler]

I think it is going to hurt the industry the exact same way 0% financing did, only to a greater scale.



It was a quick fix that GM did to move vehicles, whice the other two really had no choice.



I also think Toyota is overestimating thier customers. Money talks, BS walks.





Tom

 

[Robert Barker]

I agree the Big Three are essentially at the bottom of what they can do now to get customers in to buy their products. The Japanese brand customers come for the products/reliabaility/looks the American brands are now basically being driven by price. The most interesting thing I find is that "everyone" seems to think this Employee pricing is such as deal and it is if you arent a haggler but if you can hagle in some cases you can do even better than the employee pricing. This employee pricing marketing plan reminds me of 10 yrs ago when Saturn started the one price movement every automaker tried to copy it but it failed.... this employee pricing is just another iteration of that. The scary part is what will they do next to drive people to the door? About all that is left is to make products that people "want" which is has always been the challenge.

 

[Johnny O]

Only in the sense that people get into a "sale mentality" and only buy stuff when it's on sale. And if it isn't, wait until it is. I'd rather they just built less cars for inventory and made custom ordering easier. In 2000 my dad ordered a BMW*, no problem. Order was sent to Germany, car built, shipped across the ocean, and trucked to the dealer in less than 5 weeks. The whole dealer thing and buying/selling process is screwed up because they're all set up to put you in a car today-right-now-quick before you have a chance to look and maybe buy somewhere else. When I got my first Ranger back in '99 I special-ordered it and it was like pulling teeth.



* The Beemer is gone, worst POS my dad ever owned. He traded it on a new Cadillac last year. We determined that BMW stands for Bring My Wallet or Bavarian Money Wastebasket. Stuff would break all the time and was hideously expensive to fix. Great cars as long as they're on warranty.

 

[Michael Cacioppo]

American auto makers sold their future and now they are paying. The burden on each auto produced is too high. Health care alone attributes to $1500 per car! In the past auto makers agreed on union contracts that are now showing their true cost. When you have a monopoly on labor (United Auto Workers) this is bound to happen. I say monopoly because the big three all have the same union workers. The union could decide who among the three they would strike to get better benefits and pay. The struck company was at a tremendous disadvantage since the other two were still making and selling cars, the stuck company had to cave in. Remember it was, and still is, illegal for the auto makers to unit collectively and hold their ground against the union.



No foreign auto manufacturer, to my knowledge, has this burden. We need more robotics in the factories. IMHO

 

[Dreman]

I agree with JohnnyO. Not only do salesmen not want to order cars anymore, some of them don't seem to know it is possible. Whenever a salesman wants to say something like "we'll get you in a new car today!", I just look at him and tell him my average time between starting to look at cars and actually buying is about a year, and I started yesterday.

 

[Thomas Rogers]

Dreman says:

I just look at him and tell him my average time between starting to look at cars and actually buying is about a year, and I started yesterday.

Ha. You and I are different brother. My wife and I have an agreement that I can't go on a car lot until we are ready to buy. The reason...my time between starting to look and starting to buy is about 1 day. Sure, I do a lot of Internet based research before. But when I walk on a lot, I have a make, model, trim and price in mind. If the sales person wants to play games, they lose the sale. If they want to make a deal, they put some coin in their pocket.



TJR

 

[Teddy GreeneII]

I'm wondering how this will affect them in the future. We sell these auto voice dialers, if you want an alarm and dont want to pay 30-40 bucks a month to have it monitored you plug this thing in, same to monitor any condition ie cold, alarm, etc, once we put them on sale, buy 10 get one free, that was it, our sales dropped off because people would either hit us up for the sale or wait until it was back on to buy. it took us killing the special for about a year to straighten it out. I realize cars are big dollar items but Im just wondering.......it seems like at least 1 of them will be willing to do it once in a great while and if so how will that effect them?

 

[Old Guy]

I have a 1998 Toyota Sienna, last Toyota I will probably ever buy! Several million Toyota engines are plagued with oil sludge problems. I've changed my oil every 3,000 miles but still wonder if the sludge bug will bit me! Paid big bucks for a bag of problems, they have also had transaxle problems! No thanks Mr. Toyota, can keep his vehicles also the local Toyota dealer has an attiude you can't believe! I think God checks in with him every day for instructions!

 

[Deleted deleted]

That 'sludge' problem was due to folks not changing their oil regularly. Some vehicles had over 10,000 miles on them before the oil was changed. I've never had any problems with the 1.8L Corolla engine in my Toyota Matrix.

 

[Robert Barker]

Next thing that we will be being discussed is what they are going to do with all the USED cars. I was by the local Ford Dealer here in Gallatin TN (a very small dealer) and they had at least 2 times the number of used cars as they did before. I would expect to see the next headline to read about how used car prices are falling due to an over supply of them..... should be interesting!



Trac N Tennessee

 

[Johnny O]

The Toyota oil sludge problem is confined to the V6. Granted the typical Toyota owner probably doesn't change oil often enough, but the actual culprit is an overactive PCV valve.

I read on another site that the best solution is to just buy the cheapest oil and filters you can find, i.e. SuperTech at Wal-Mart, and change it every 2000 miles.