General Motors Giving Up the Goat- What's an Incentive Really Worth Anyway?
Today, GM disclosed some of its final discounts on its departing brands, namely Saturn and Pontiac, of which, not even billionaires with deep pockets and large egos nor emerging markets wishing to break into the sexy, yet increasingly tricky business of producing cars could not even save.
$7,000 (Rebates-To-Dealer) on each car, reportedly on cars going to rental and or service fleets; which, a lot of dealers operate as a way to spin factory incentive monies into their pockets, putting “units on the board” (boosting monthly sales numbers) vying to make their monthly quota. Note- this is dealer cash, unlike a lot of rebates offered to the public- meaning- they don’t necessarily have to funnel the savings to you, the buyer- they can try to hold some of it as a profit in a deal. In other words- make sure you ask for these funds if you’re so inclined to buy a new, soon-to-be departed Pontiac or Saturn.
These savings could make it easier to move units to customers looking for a four-wheeled-bargain; but I’d be very cautious on buying one of these units- as they may technically be labeled “used cars,” thus putting the original three-year/36 month bumper-to-bumper coverage in question. The way I’m understanding the deal is- to get the $7,000 a copy (per car unit) the title has to be transferred from the original MSO- the Manufacturers Statement of Origin, or the original title. I’m not in the car business anymore, but the waters can get murky when rebates, dealer cash and other incentives get before the bottom line.
Most all GM vehicles qualify for the five-year/100,000 mile powertrain coverage which is transferrable to future owners- an incentive for buying a used GM car, that is not only used, but is no longer in production- living in the hearts and minds of people who remember American cars “when.” But anyway…
One car that is saying goodbye is the Pontiac G8, and believe it or not, the G8 has actually gotten many accolades for being a Pontiac that “certainly doesn’t suck,” or the car that “came too late to the party to save Pontiac.”
The G8 is a mid-sized sedan, taking the places of the once-all-mighty Bonneville, Grand Prix and GTO as top Pontiac heap.
The G8 is actually a re-badged/engineered Australian-sourced Holden, and unlike the GTO that faded into the sunset a few years ago- this Holden offers a lot of rear-wheel-drive performance for the dollar, competing in the same performance sentence as a mid-sized BMW 5-Series.
Yes, BMW 5-Series.
A little known secret is- the 2009 Pontiac G8 was engineered and tested by the very same engineers who brought you the suspension set-up on the previous generation (E39) BMW 5-Series- certainly not a performance sedan that sucked at all, albeit five years ago.
The Pontiac G8 rides, reportedly handles and zips around the track like a car, costing about twice its $30,000-plus base-price tag. Certainly the cheapest mid-sized BMW you’ll ever drive.
All these deep discounts are fine and dandy if you’re short on the funds to get into a new car, but really, discounts are just drops in the bucket when it comes to a car’s residual or used car value- if you care at all. There is no free lunch here.
Nothing; not even $7,000, makes up for the fact that these cars will be worthless sooner than later, especially since the nameplates are now officially history.
My friend who vowed to buy the last black-on-black Pontiac G8 with a Tremec six-speed, stating an almost rehearsed “It’s not over… till it’s over…” looking to re-hash his GTO-days past pulled-out of the notion. I guess he’s finally moving on, “giving up the ‘Goat’ ” some forty years later. Yeah, it’s really over. This cat is skinned.
There’s a lot to be said for a nameplate when it comes to cars. It’s a lot like location in real estate. It speaks volumes on, and has a lot to do with value. Or eventual value.
Just look at the Pontiac Silverdome, which cost an inflation-adjusted $220 million to build 35 years ago. It sold for some $583,000 just a few weeks back. Finally real estate that valued-out a lot like a new car ultimately does.
Could you imagine if it were the Silver BMW-Dome? It would have sold for a lot more. For sure.