Two major carmakers are fighting an incentives battle with their key new models in Europe, one of which is not yet on sale.
According to Automotive News Europe (ANE), German buyers of Volkswagen’s Golf, who trade in a non-VW car, can receive a €1,000 discount while rival General Motors Europe (GME) is offering a €1,085 discount package on popular options to buyers who order an Opel Astra – before the model’s March 19 launch date.
Offering such deals on new models, in the Astra’s case before the car is even launched, is highly unusual, the newspaper noted.
“We want to bridge the gap between the Golf and our Astra launch dates,” Opel spokesman Rüdiger Assion told Automotive News, which said that the Golf was introduced in November.
A German VW dealer reportedly said: “It is an unusual programme at the beginning of the Golf’s lifecycle, but it will help the Golf to stay ahead of the game.
The paper’s report suggests that loss-making GME, now in full recovery mode, sees the new Astra’s successful launch as crucial. Automotive News Europe quotes General Motors Europe president Michael Burns as saying: “2004 will be a watershed year for Golf and Astra in Germany” and added that Burns plans to have half of his organisation concentrating on the Opel/Vauxhall Astra launch.
According to ANE, dealers say that Germans like the new, larger Golf but find it too expensive and one claimed that customers are buying Polos instead because of the high price of the Golf.
The paper said VW launched its incentive programme on January 1 because it was worried that buyers would wait for the launch of the Astra, which will be about €2,000 cheaper than the Golf.
Some German buyers are re-importing new Golfs from neighbouring countries such as Belgium and France because they are cheaper outside Germany, Automotive News Europe noted.
The Golf reportedly accounts for 25% of VW brand sales and traditionally half of the giant carmaker’s profits.
A December survey of 50 VW dealerships by Automobilwoche, a sister publication of Automotive News Europe, showed that German demand for the new Golf was far lower than expected and initial sales were below those of the previous model.
A VW spokesman told the paper that Golf incentives are not being publicised, adding: “It is an internal arrangement for dealers which they can pass on to the customer.”
The Golf also looks expensive in the UK, its major right-hand drive market, where it was launched this month. The popular mid-range SE specification is priced at £14,785 to £16,605, depending on engine. A newly-released rival, Mazda’s 3, costs £12,800 to £14,800 in comparable mid-line TS specification while Vauxhall’s Astra Club, which the company says matches the Golf SE in equipment terms, will cost £12,995 to £14,895 when launched in the spring.
However, the previous Golf is known in the motor trade for its low depreciation and commands higher part exchange and retail prices than rivals.