Reduce Price to Improve Revenues and Margins

CHOICE 1 OBJECTIVE: ATTRACT CUSTOMERS

CHOICE 2 SEGMENTS: PERFORMANCE PERCEPTION SEGMENT / A BRAND WITH PERFORMANCE (I.E., FUNCTION, RELIABILITY AND CONVENIENCE) AT THE LOWER END OF THE BRAND CATEGORY

CHOICE 3 COMPONENT: PROVIDE A REBATE

No.	SIC	Year	Notes
1	3711	1990	Ford yesterday announced rebates on nearly all of its 1991 models.
2	3711	1998	At General Motors, incentive costs rose to an average of $1,305 per car in first quarter, up 52% from a year earlier.
3	3711	2002	The Big Three can't even pay people to buy their cars. The combined market share of GM, Ford, and Chrysler fell to 60.7% (an all time low), while incentives rose 26% year-over-year, to more than $2,000 per car. Chrysler even had to give $1,000 rebates on its once-popular PT Cruiser last month. This contrasts with European carmakers, who spent $1,200 per car, and Asians, who spent just $850. It seems that even cash can't beat the attraction of foreign vehicles.
4	3711	2003	U.S. automakers are already at a disadvantage in appealing to consumers, having been forced to increase their incentives to 15 percent of sales prices in 2002, twice as high as those offered by foreign competitors. The U.S. market share of the Big Three has slipped over this period as well, by a combined 1.5 percent a year. The need to offer increasingly large incentives to offset the lower resale value of U.S. cars reflects perceived problems with their long-term quality and durability.
5	3711	2005	American automakers spend significantly more on incentives than their foreign rivals. In July of 2005 European automakers' incentives for the US market hit $2,562 while Japanese marks reached $1,025 and Korean brands decreased slightly to $1,833. GM led the pack with an average incentive of $4,467 per vehicle.

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