GM's deals get more desperate as 0% loans lose luster
In comparison to the continuing success of the leading Asian car companies, there's not much good news from the domestic car industry according to this Wall Street Journal story (subscription required) and the continuing 0% financing deals are just making things worse in the longer run even if they do increase immediate sales:
As 0% financing deals lose their allure for consumers, General Motors Corp. is aggressively prodding salesmen and dealers with cash and bonuses as a way to rekindle cooling U.S. sales.
Early indications from dealers suggest GM will maintain the current level of consumer rebates and financing offers when the company outlines new incentives Friday. GM has been offering loans of 0% for 60 months on most of its passenger cars, and also on its 2003 Chevrolet TrailBlazer sport-utility vehicles in some parts of the country. GM officials said Wednesday they will extend until Jan. 2 the current "Zero, Zero, Zero" plan that offers consumers no payments and no money down for 90 days. That program had been set to expire Thursday. GM and other auto makers report U.S. sales results Friday.
...Rivals, which have been forced to match many of GM's programs since last fall, are sharpening their criticisms of GM's sales strategy. Ford spokesman Jim Cain said GM is moving from "acts of quiet desperation" to "acts of public desperation" to sustain sales. "I don't think there's anyone in the industry who believes these types of incentives are good for the industry on a long-term basis."