Wednesday, July 12, 2006

How Deep Can We Bury 'Em?

This seems to be the question that DaimlerChrysler execs are asking themselves as they heap back into employee pricing and 0% financing. Although I like the financing program as an incentive to consumers, offering the employee pricing and huge rebates is a bad move.

Why, you ask? Well it's simple really. Typically, domestic buyers stay in the domestic family, i.e., they buy domestic cars. But, when you offer deep discounts, you bury your customer in the loan so bad that no length of rope can pull them out. Simply put, DamChry is DESTROYING their used market by pushing more and more product into the market. Currently, a bank will finance you in a new auto loan up to 130% of the car's list.

The question is, how much farther will that bank have to go to dig the customer out in the future? 140%? 150%?

I am glad I don't drive a Dodge.


At 7:21 PM, Blogger Neo-Con Tastic said...

No comment.

At 7:21 PM, Blogger Neo-Con Tastic said...

Wait, then why'd I leave a comment?


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