Japanese car-buying incentives reach new peak
The average manufacturer-issued vehicle buyer incentive in the USA was US$2,556 per vehicle during March 2005 (up 7.0% on March 2004), but Japanese manufacturers increased incentives to national record high of US$1,110 per vehicle in order to gain 0.2% market share (for a total of 32.1%), according to automotive information firm Edmunds.com.
Overall, combined incentives spending for domestic Chrysler, Ford and General Motors nameplates averaged US$3,472 per vehicle sold in March 2005, up US$311 from February 2005:
- Chrysler increased incentives spending by US$200 to US$3,507 per vehicle, while its market share decreased by 1.3% to 13.6%.
- After five consecutive months of lowering incentives, Ford reversed course and increased incentives spending by US$389 to US$3,064 per vehicle in March, while its market share decreased by 0.8% to 17.9%.
- General Motors also spent more money on incentives in March, increasing by US$312 to US$3,732 per vehicle sold, while its market share recovered from its February low point, increasing by 2.4% to 26.4%.
Overall, domestic manufacturers gained market share in March, increasing from 57.6% to 57.9% compared with March 2004.
Lost market shares In March, Korean automakers also increased incentives spending by US$120 to an average of US$1,737 per vehicle sold, but lost 0.2% market share, achieving a total of 4.2%. However, the European automakers decreased incentives spending by US$23 to US$1,967 per vehicle sold and lost 0.3% market share, achieving a total of 5.7% (which is the lowest market share for the European manufacturers since October 2001).
Luxury cars have lost the most market share since March 2004, decreasing from 3.1% to 2%, while large trucks have gained the most market share during that period, up from 14.4% to 15.2% of the new vehicle market.
Edmunds.com's monthly True Cost of Incentives (TCI) report takes into account all of the manufacturers' various USA incentives programmes, including subvented interest rates and lease programmes, as well as cash rebates to both consumers and dealers. The company bases its calculations on sales volume, including the mix of vehicle makes and models for each month, as well as on the proportion of vehicles for which each type of incentive was used.