The average automotive manufacturer incentive in the US was $US2,195 per vehicle sold in October 2007, down $162, or 6.9%, from September 2007, and down $89, or 3.9%, from October 2006, according to Edmunds.com.
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Combined incentives spending for domestic manufacturers averaged $3,145 per vehicle sold in October 2007, down from $3,241 in September 2007.
From September to October, European automakers decreased incentives spending by $765 to $2,042 per vehicle sold; Japanese automakers decreased incentives spending by $141 to $1,045 per vehicle sold; and Korean automakers decreased incentives spending by $191 to $1,500 per vehicle sold.
In October, the industry’s aggregate incentive spending is estimated to have totaled approximately $2.71bn, down 12.0% from September. Chrysler, Ford and General Motors spent an aggregate of $1.96bn, or 72.2% of the total; Japanese manufacturers spent $486m, or 17.8%; European manufacturers spent $193m, or 7.1%; and Korean manufacturers spent $79m, or 2.9%.
“Incentive averages declined because the majority of vehicles being sold now are 2008 model year and don’t require overly generous marketing support,” said Jesse Toprak, head analyst at Edmunds.com. “This typically occurs later in the calendar year, but in 2007 we had earlier model introductions as well as dramatic production cuts that reduced available inventory.”
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By GlobalDataAmong vehicle segments, large trucks had the highest average incentives, $4,188 per vehicle sold, followed by large SUV’s at $4,160. Compact cars had the lowest average incentives per vehicle sold, $849, followed by sport cars at $1,125.
Comparing all brands, in October Mini spent the least — virtually nothing, followed by Scion at $109 per vehicle sold. At the other end of the spectrum, Cadillac spent the most, $4,953, followed by Saab at $4,790 per vehicle sold. Relative to their vehicle prices, Saab and Mercury spent the most, 14.5% and 13.0% of sticker price, respectively, while Mini spent virtually nothing and Scion spent just 0.6%.
“It wasn’t long ago that the big spenders invested over $7,000 per vehicle,” said Edmunds’ AutoObserver.com senior editor Michelle Krebs. “Automakers are really sticking to their guns, staying true to the real-world pricing strategy they have talked about.”
