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General Motors Giving Up the Goat- What's an Incentive Really Worth Anyway?

Travis's picture




 

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.  

 

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Tue, 12/29/2009 - 17:29 | 177161 bugs_
bugs_'s picture

Cold call from a chevy dealership today.

Tue, 12/29/2009 - 17:38 | 177170 Anonymous
Anonymous's picture

my first car was a 1969 GTO hardtop...... i'd love to have another one, but it would probably have a hard time running right on today's 91 octane unleaded gas. plus it got about 13 MPG if i took it easy. fun car, though.

Wed, 12/30/2009 - 09:33 | 177623 Bob Dobbs
Bob Dobbs's picture

'66 with a 389 and a six pack.  Woof!  Rip the enamel off your teeth.

Tue, 12/29/2009 - 17:59 | 177187 Jeff Lebowski
Jeff Lebowski's picture

Nice.

I have a 1968 'bird in the garage as well. 

Tue, 12/29/2009 - 17:40 | 177173 ahab
ahab's picture

a Pontiac made in Australia-

hmmm . . . I'll pass

Tue, 12/29/2009 - 17:48 | 177179 Internet Tough Guy
Internet Tough Guy's picture

A lot of people passed on it. Dealer lots are lousy with G8s.

30k for a pontiac with no warranty and probably no parts maker in a couple years? Pass.

Tue, 12/29/2009 - 18:32 | 177222 Anonymous
Anonymous's picture

This car is based on the main large fleet car in Australia, you will never run out of parts (external mouldings perhaps). An equivalent vehicle here in australia sells for over $50000 AU. The GTO, was a two door version from the previous generation of this fleet car. Its a good deal....

Wed, 12/30/2009 - 08:24 | 177588 Anonymous
Anonymous's picture

The Australian designed Chevrolets (Holden) aka Pontiac G8 and the equivalent Australian Ford Falcons are superb cars that are far better in design and quality than ANY US designed saloon.

How about you take a drive in one before "passing" on it.

Tue, 12/29/2009 - 17:59 | 177180 ZerOhead
ZerOhead's picture

Silver BMW-Dome... hmmm... nah... same price.

(Call it a hunch!)

Plus these big girls were built as 'loss leaders' to draw convention and entertainment business into the community. They cost a small fortune to operate and insure.

Tue, 12/29/2009 - 18:03 | 177191 Waterfallsparkles
Waterfallsparkles's picture

Had a Grand Am.  Loved it.  Sleak and powerfull. A real looker.

Now I have a Sunfire with the Sport package, dual exhaust, tackodometer and all.  Love it.  Talk about performance.  You step on the peddal and it really moves out.  Real gas sipper but has trememdous power surge when you need or want it. Fold down rear seats for moving items.

I will miss the Pontiac.  Especially as a Woman.  I would find it hard to drive a Mustang as it says Macho Man which I am not.  The Pontiac gave me the ability to drive a preformance car without looking like the Marlboro Man.  What a loss.

I have owned GM cars all my life.  I have owned 3 Cadillacs, 2 Pontiacs and 1 Buick.  But I have to say I really do not think that I would ever buy a GM car again as I am really upset that the Unions (who ruioned the Company) and the Government who now own the Company.  Bond holders got the shaft.  I do not buy into Socialism especially from a Car Dealer.

Really sorry to see Ponitac go but would have had a hard time buying my next car from the Government and a Union Owned Company.

 

 

Tue, 12/29/2009 - 18:11 | 177202 impending doom
impending doom's picture

Having owned the Chevy equivalent of your Sunfire, I have to disagree with everything you just said. The Crapalier Z24 deserves to go on the rubbish pile of history, along with everything else GM's put out in the past 20 years.

Tue, 12/29/2009 - 19:29 | 177264 Waterfallsparkles
Waterfallsparkles's picture

My Son had a Cavaler and loved it.  He has over 200,000 miles on it.  Said the secret was frequent Oil changes.

Interesting that with the Foreign Car makers you have to preform certain maintance or you void your warranty.  Maybe that is the true reason their cars seem to do better.

Gm Owners do not have an incentive to take care of their cars.  I am not saying you did not, you may have just gotten a lemon but any car will last longer with TLC and Oil Changes.

Wed, 12/30/2009 - 11:45 | 177731 impending doom
impending doom's picture

I wish it was just a lemon. Sadly, my dad was a hardcore GM guy: he always said Ford stood for "Found On Road, Dead" or "Fix Or Repair Daily". Therefore, While I lived under his roof I had to buy Amerikkkan. That meant not one, but two Crapalier Z24's, since there were exactly ZERO decent alternatives. Both were total "planned obsolescence" models as everything that could break, did. If you need an example, how about 3 failed power window motors in the first 2 years (this is a 2-door BTW), peeling plastic off the steering wheel, cracked dashboard (not covered under warranty I might add), I could go on, but whatever, I drive a Honda now so I'm trying to put the past behind me.

Wed, 12/30/2009 - 11:48 | 177733 impending doom
impending doom's picture

Forgot to mention that, thankfully I religiously changed the oil and performed other scheduled maintenance, so had very few probs w/ the drivetrain. everything else was a massive painfest, though.

Thu, 12/31/2009 - 02:31 | 178657 hbjork1
hbjork1's picture

impending.....:

I had been echoing your dad through the years.  I had the same experience early on.  Bought a 71 Ford that burned oil.  Took it back to the dealer.  He  gave me a copy of a curve and said they would rebuild the engine if the oil usage exceeded the amount shown on the curve.  The oil consumption followed the curve staying just inside the line for 20K miles.  That was my last Ford.  I also had a little carburator fire with that one.  I have been driving GM product sinc about 1973 with relatively few non-maintanence repairs.  

My brother in law had a Lexus (mid 90's but low mileage).  He had a break line failure with loss of braking in downtown Chicago (where he lives).  He had to get out of traffic and got to the dealer using the emergency brake.  GM policy has been to put out bulleting to the dealers.  That kind of failure shouldn't occur.  Could kill somebody.

GM started getting in trouble during the creative financing of King Roger the first.  Disposed of Detroit Diesel to Roger Pensky after the diesel management had spent $250-$350 million developing an excellent new 4 cycle engine (both numbers bandied about). Their previous product line had been 2 cycle. 

The new CEO, Whitaker, first publically said: "I don't know anything about automobiles."  OK, he was learning and honest about it.  Then later on he said: "--- we have to do something about this culture of trying to get everything right."  (I don't remember the full quote)

I was planning to buy a Lucerne to replace my LeSaber with ride and interior packages. (No significant problems to 120+K miles but now burning 2qts between changes)  Now I am waiting and don't know what to do.

Yes, when politicians take over---.

The laws of man are largely about getting people to do what others want then to do withing the society.  Things can be adjusted if the judge or jury can be emotionally moved.

The laws of nature (or Mother Nature's laws or God's laws - whichever we prefer,) are inexorable. 

Tue, 12/29/2009 - 20:32 | 177301 glenlloyd
glenlloyd's picture

Both engines used in Sunfire / Crapalier were frequently bad, especially head gaskets went on the 2.2 SOHC and often the valve train on the Quad4 Olds engine went south quickly, especially if not maintained properly.

I see these cars all the time, sold to the recycler I work for, torn up beat up and flogged within an inch of the lives, and I'm talking cars that are not even 10 years old.

All in all probably a few good ones but I wouldn't touch one with a ten foot pole.

just sayin...

Wed, 12/30/2009 - 11:49 | 177734 impending doom
impending doom's picture

I had the 2.4 DOHC, so maybe that one was marginally better.

Tue, 12/29/2009 - 18:33 | 177223 A Nanny Moose
A Nanny Moose's picture

What year G/A? I had a '73 2-dr. with 400 and 4bbl carb. One of the best handing, best looking coupes of it's day. A blast to drive. I miss it.

Tue, 12/29/2009 - 18:04 | 177193 Rusty_Shackleford
Rusty_Shackleford's picture

The ballad of the Twentieth Century Motor Company plays itself out time and time again.

 

 

http://www.youtube.com/watch?v=KCmJUobwKQk

 

 

Tue, 12/29/2009 - 18:10 | 177200 Anonymous
Anonymous's picture

What kind of incentives are they offering for Saabs?

I might buy one and put it in storage for 40-50 years with a couple of cans of gasoline. There may be some vintage value to be had there.

Wed, 12/30/2009 - 00:26 | 177471 Anonymous
Anonymous's picture

Remember the Sta-bil (TM)

Tue, 12/29/2009 - 18:12 | 177205 Sancho Ponzi
Sancho Ponzi's picture

It sounds like tax evasion given the end of the year is upon us. 'We at GM want you to evade inventory taxes.' You can't make this stuff up.

Tue, 12/29/2009 - 18:14 | 177206 John McCloy
John McCloy's picture

More cash incentives courtesy of Uncle Tax payer and his great great great great great great grandchildren. GM is still sitting on what..39 billion of our money?

Someone is confusing the pockets of the taxpayer with the "Amazing" Uncle taxpayer.Contrary to popular belief the Uncle taxpayer does not have endless pockets nor can he escape handcuffs while underwater..That would be The "Amazing" Uncle Taxpayer.

Tue, 12/29/2009 - 18:15 | 177208 Cursive
Cursive's picture

Deflation.  There is too much production capacity.  Keeping GM afloat will only hurt companies with good management.  Prices will fall much farther until capacity utilization drops to equilibrium, government policy be damned.

Tue, 12/29/2009 - 19:04 | 177249 wang
wang's picture

reality:

consumer confidence actual 52.9

concensus 53.0

 

the BS headline

U.S. Consumer Sentiment Gains in Signal Economy Will Expand Into Next Year

 

Tue, 12/29/2009 - 19:08 | 177253 Anonymous
Anonymous's picture

Cars are pretty much worthless when you drive them off the lots anyway .. I might take a chance on a G8 if I can get all the rebate. My 13-year old Bonnie is getting a little worn down ;)

Tue, 12/29/2009 - 19:40 | 177271 phaesed
phaesed's picture

ahhhhh, that's why you buy cars made from the mid 70s and earlier.... you can repair the shit yourself. Not to mention engine conversion kits to either biofuels/electric aren't that difficult to self-install as well.... all without giving the Government the option to log into your car and track you.... tsktsk, didn't you think there was another reason why you needed a new car?

Wed, 12/30/2009 - 09:05 | 177608 impending doom
impending doom's picture

Not to mention the cost of repairing a fender-bender. My first car was an '85 Olds Cutlass Supreme BroHam. Backed into a pole; cost to hammer out the dent on my steel bumper: $250. Did the same thing 10 years later in the Crapalier; cost to replace the plastic bumper: $1500. Ah, progress...

Tue, 12/29/2009 - 20:37 | 177307 glenlloyd
glenlloyd's picture

That's what I drive, a fleet of diesel VW's from the 80's and late 90's. The carbon footprint of these small diesel engines is impressive although it's the soot from petrodiesel that green lovers often latch onto when complaining. Personally I enjoy a whopping 47mpg in town back and forth to work in a 26 yo car...no problem here. My recent acquisition is much larger though, a 93 benz s350 turbodiesel. Much more comfortable to drive....very cushy and big.

Thu, 12/31/2009 - 09:47 | 178738 Bob Dobbs
Bob Dobbs's picture

Easy to work on too.  There was not much to those diesels from VW, just rock solid little cars.  I'd like to get a mid-eighties Benz diesel cab.  I could get a million miles out of one of those.

Tue, 12/29/2009 - 20:41 | 177309 Rainman
Rainman's picture

I haven't owned them all, but I've had/have a bunch of them. BMW, Mercedes, Lexus, Infiniti, Toyota, Nissan, Dodge, Chevys and Fords.

Best and most reliable of them all for the $$$ in my lifetime is the '01 Toyota Tacoma and the Chevy Tahoe '05/'06. Some of my car dealer friends agree. 

I'm no fan of Government Motors, but they've had some pretty good models in the 21st century and some real losers, too. Dirty secret is most of the GM parts can be replaced with knockoffs from China at half price. Smash in your front bumper and don't ask for an OEM part at the chiseling repair shop and they'll put on the knockoff, bill the ins. co. for the stock part and pocket the difference. You'll never notice the difference, either. Every year, the Chinese update.....big business over there is US auto repair.

You can rebuild your entire GM vehicle with foreign knockoff parts....tires and all.  Like buying a Louis Vitton handbag in Manhattan......buyer just don't beware of nuthin' if it looks right.   

 

Tue, 12/29/2009 - 21:51 | 177351 percolator
percolator's picture

nice post

Tue, 12/29/2009 - 22:48 | 177405 Anonymous
Anonymous's picture

Boycott the Government. Buy Ford or Foreign.

Wed, 12/30/2009 - 03:48 | 177531 Anonymous
Anonymous's picture

Good evening. Wow, on the front top of the page of the www.huffingtonpost.com has a radical honest proposal to pull all $ out of the 'too big to fail' banks that are screwing us and not lending.
This is catching fire rapidly among the readership. Which is the #1 read newsite now. Aside from google news and yahoo news of course.

mrjumbomortgage

http://thegreatloanblog.blogspot.com

Wed, 12/30/2009 - 03:49 | 177533 mrmortgage
mrmortgage's picture

 

Good evening. Wow, on the front top of the page of the www.huffingtonpost.com has a radical honest proposal to pull all $ out of the 'too big to fail' banks that are screwing us and not lending.

This is catching fire rapidly among the readership. Which is the #1 read newsite now. Aside from google news and yahoo news of course.

 

mr. jumbo mortgage

 

http://thegreatloanblog.blogspot.com

Wed, 12/30/2009 - 04:03 | 177542 Slewburger
Slewburger's picture

Eat a bag of dicks spammer.

Can we ban this assclown?

 

Wed, 12/30/2009 - 10:44 | 177684 Jeff Lebowski
Jeff Lebowski's picture

It might not be relevant to the topic at hand with discussions of Quad4s and GrandAms, but it (the moveyourmoney movement) certainly doesn't seem to be spam and I didn't find it to be junk.

In fact, the change in Huffington Post over the past few months is encouraging.  It appears that left and right can agree that we're getting fucked by the banks and hedge-funds masquerading as banks.

Wed, 12/30/2009 - 11:52 | 177740 impending doom
impending doom's picture

Dude, I'm right there with you except Treehorn here posts the same fucking garbage spam on every single story he reads here at ZH. Do the math.

Wed, 12/30/2009 - 12:45 | 177793 Jeff Lebowski
Jeff Lebowski's picture

That's fair.  I haven't followed his responses, so I cannot defend the individual (it seems that there are many new faces here as of late), but rather, this particular message. 

 

 

Wed, 12/30/2009 - 06:40 | 177564 JackD
JackD's picture

Will ZeroHedge ever consider being selective about who it lets advertise on the site?  I'm tired of seeing ads for Ally Bank, a rebranded GMAC - the financing arm of the now defunct General Motors.

Wed, 12/30/2009 - 09:10 | 177612 impending doom
impending doom's picture

Just use Firefox and adblockplus. I didn't even realize the hedge had ads... But I did buy a t-shirt, before I get flamed.

Wed, 12/30/2009 - 09:02 | 177605 Anonymous
Wed, 12/30/2009 - 13:37 | 177855 Anonymous
Anonymous's picture

Giving up the 'goat'?? lol Ya gotta love high school graduates these days.

Wed, 12/30/2009 - 15:34 | 178035 Jeff Lebowski
Jeff Lebowski's picture

Obviously, you're not a golfer...

 

Goat is what the GTOs (the 60s and early 70s) were called back in the day.

I would ask if you're under 25 and a car guy, but your comment and LOL already answered that for me.

 

Better to remain silent and be thought a fool than to speak out and remove all doubt.

Wed, 12/30/2009 - 17:04 | 178182 Anonymous
Anonymous's picture

Oops... never heard that term back in the day. My bad. I thought I had yet another grammar error or misspelling to gloat about. rats.

Wed, 12/30/2009 - 15:33 | 178031 Anonymous
Anonymous's picture

The time for mourning was with the passage of Plymouth.

I saw no 426 Hemi parade on 5th avenue in manhattan then, and nothing said America more than the roar of an unrestrained 426 hemi with a pair of Holley's on top.

Maybe a blower if you're feeling hornary.

I was lucky enough to possess a 1974 Plymouth Gran Fury III Police interceptor for the whopping sum of $100 from a neighborhood local displeased with his fuel economy.

I wondered aloud why it had bald rear tires when I picked it up. Later that day, I understood.

My fastest time was about 11 seconds 1/4 mile from 21st street to 8th street down 1st avenue in manhattan.

WEEEEEEE!

-MobBarley
rip 'Christine'

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