New safety features can help GM scale back on consumer incentives

  • Business
  • Saturday, 12 Feb 2005

CHICAGO: New safety features that General Motors Corp is offering in its vehicles could help it scale back on its high consumer incentives, a top GM official said. 

The motor vehicle maker said last week that it would gradually make standard across its line-up safety systems such as electronic stability control, anti-lock brakes, traction control and the OnStar communications system. 

“You see our incentives are mitigating. We really do want to dial up this value equation,” Gary Cowger, president of GM North America, told reporters at the Chicago auto show on Wednesday. 

On Wednesday, GM revealed two new full-sized sedans, the Cadillac DTS and the Buick Lucerne, which will have front passenger airbags that inflate to two different levels depending on the severity of a crash, whether occupants are wearing safety belts and on seating position. 

A few years ago, GM stopped offering some features such as anti-lock brakes as a standard item on some vehicles. But now, the vehicle maker is betting that safety will help sell vehicles, as it attempts to cut back on its incentives.In January, GM's incentives averaged US$3,513 per vehicle, down from US$3,830 in December and off from US$4,189 in January 2004, according to Autodata, which tracks industry incentives. GM has led major motor vehicle makers in consumer incentives for years, but the Chrysler arm of DaimlerChrysler AG offered higher incentives than GM did in January, Autodata said. 

Vuick GM John Larson givews two thumbs up to the new 2006 Buick Lucerne luxury sedan during its unveiling at the Chicago Auto Show. - APpic

Some of GM's marketing programmes, such as the “Hot Button” giveaway of 1,000 cars and trucks early last year, failed to meet expectations, Cowger said. 

But GM would continue to try to come up with creative marketing campaigns and incentive programmes to spur sales, just as Volkswagen AG was doing by offering free car insurance with the purchase of a new VW, Cowger said. – Reuters  

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