Chrysler adds dealer incentives to clear stock

NJ Vike · 2006-05-16T21:59:43+00:00

Automaker offering richest discounts of Big Three to knock down inventoryDETROIT - Chrysler Group is offering its U.S. dealers incentives of up to $1,250 per vehicle sold this month and next in order to clear excess inventory in the run-up to the summer car shopping season, dealers said Monday.Chrysler has struggled with high inventory levels this year, prompting the unit of Germany's DaimlerChrysler AG to offer the richest consumer discounts of any of the domestic automakers.The reliance on customer rebates and incentives cut Chrysler's first-quarter earnings by more than half, even though the automaker has scored with some top-selling vehicles and avoided the losses and erosion of market share that have plagued both General Motors Corp. and Ford Motor Co., the other members of Detroit's Big Three.At the end of April, Chrysler had an 80-day supply of vehicles in inventory, the company has said, above the two-month supply that it has targeted as a more desirable level.On average, Chrysler offered a consumer discount of $3,769 in the first four months of the year, more than the $3,189 offered by Ford or the $3,050 by GM, according to industry tracking service Autodata.Chrysler, which last week announced a zero-percent financing offer for new car and truck buyers, also asked dealers to take more vehicles for May and June, a move that would cut into its own unsold inventory of over 586,000 vehicles as of the end of April.Dealers that accept the additional vehicle shipments and meet sales quotas can receive cash of up to $1,250 per sale, dealers presented with the offer said.It was the second dealer incentive program that Chrysler has rolled out this year, leaving some dealers uncertain of whether they would be better off carrying the additional inventory.The move comes at a time when higher interest rates have also boosted the cost of holding dealer stocks of unsold cars, traditionally one of the largest single costs for showroom operators."Obviously, they've got a...

May 16, 2006 24 Replies

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Alex Rodriguez 20 years ago

When I went shopping last year, I found it to be the opposite. The Chrysler price after all incentives, which included 0% financing, made it much cheaper than comparable Toyota and Honda. The price difference was over $5k. My experience with car dealer service departments has been mixed. Some are ok, others are not. It's really a crap shoot. But at $100/hour, it's a gamble I don't take. I prefer to do most work myself. It's cheaper and more convenient. Even the so called 'free' fixes end up costing me wasted time.

------------- Alex

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Alex Rodriguez 20 years ago

And it is a very nice feature to have.

------------ Alex

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Alex Rodriguez 20 years ago

I looked at one and was going to consider it until I tried to sit in the thrid row. I'm not tall, 5'7", and I was hitting the cieling with my head. The third row is useless for adults. Maybe little kids can use it.

------------------ Alex

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Art 20 years ago

I was paying cash and would not have noticed financing advantages one way or the other.

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Alex Rodriguez 20 years ago

I got 0% financing, so paying cash would have been foolish. I make money on the interest with the money sitting in the bank. That made the price difference even bigger.

------------------- Alex

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