The 2014 Silverado has won accolades, but not strong sales. Some think it’s due to styling, others think General Motors wasn’t brave enough in being more revolutionary than evolutionary, and perhaps the truck is a bit on the expensive side. Whatever the reasoning may be, Ram beat the Silverado in sales for the month of March.
Not taking this lightly, Chevrolet has announced that it is continuing its March Truck Month promotion into April, giving lease incentives a boost and increasing consumer savings on certain models of the Silverado. For March a buyer could save up to $7,541 off certain models, but with the expanded effort for April, a customer for a 4×4 diesel Silverado 2500HD crew cab can save $8,974.
Automotive News reports that Chevrolet Vice President Brian Sweeney wrote in the brand’s Dealer Playbook for April that they were adding “an additional $1,000 of bonus cash on light-duty Silverado double cabs that will help us get after the heart of the pickup market.”
An internal email to dealers shows that Silverado lease terms for the Northeast are $269 per month with about $1,900 due at signing. This is very competitive with Ram’s incentives, which are $259 per month with $2,999 due at signing.
GM spokeswoman Ryndee Carney frames the extended promotion as  “strategic and targeted incentives” to move double-cab versions of the Silverado.
Comments
My hope here, is that they will continue to have to offer incentives on Silverado-Sierra, and when the Colorado-Canyon come out, they need to maintain a price gap, which means my Canyon comes out cheaper.
This is my hope as well and hopefully this will be the case, although it wasn’t last time. That was part of the reason the last Colorado/Canyon didn’t make much sense as they did’t discount them like they did the full sizers, resulting in a narrow price gap, and sometimes an overlap, which was just plain stupid.
Still not enough. $39k today buys a new Cummins Diesel Crew Cab 4×4 with discounts. In 2005, $33k bought a DMAX / Allison 4×4 Sierra with a leather interior. She stills runs like on steroids so no reason to buy a new one.
No one has satisfactorily explained to me why GM, after billions of bailout money, quality that is still shoddy, moving production to third world countries, and uninspired products (who’d o’ thunk it we’d still be a able to get a new 4.3L V6 in 2014?), still reserves the right to be one of the most expensive automakers?
“still reserves the right to be one of the most expensive automakers”
There is nothing in any legal system anywhere that says a vehicle is to be priced within the bounds of the law. Price is to be decided by the automaker, and can be as high or as low as an automaker sees fit.
Before you interject, I don’t know or care what the average transaction price of a Silverado is, or how it’s powered. I don’t even care about the truck segment, or the willies of those who complain about prices of them.
Pricing, however it is accomplished, is not a right. It’s an exercise by the automaker that is either accepted or rejected by the consumer.
I agree with you. But that almost sounds like you are a believer in a free market system and supply and demand. By that law, GM would be gone by now.
Instead the government intermingled and rewarded incompetence with lots of money. As soon as that happened, GM did start owing people. Literally.
The only thing that changed with new GM is you no longer get the best bang for your buck.
“But that almost sounds like you are a believer in a free market system and supply and demand.”
No. I abhor self-styled economists and knee-jerk armchair investors who spend their entire operational lives in utter fear of the market behaving as they think it should. Developing a personal economic ideology and philosophy behind it doesn’t help, and writing long-winded alarmist blog post fueled by countless sleepless nights doesn’t curry favour with any respectable people.
What I meant is that lately I’ve been thinking about what makes a luxury consumer and a luxury product. I know pickups aren’t generally considered a luxury product (even though select trim levels can make a truck appear as a luxury product), but I mostly took issue with your statement “still reserves the right to be one of the most expensive automakers”. To me, it sounded as if GM was obligated to not offer a luxury product because it’s price made it seem beyond the bounds of most.
A simple misunderstanding on my part.
This will last till the inventory is down and not any longer.
GM will not lower the Colorado and Canyon prices as they do not have the mark up that the full size trucks have since they are much lower volume.
GM will adjust production to hold inventory down and will wait it out till fall when the new Ford arrives at its higher price with no incentives.
The key to future full size truck sales will be lower volumes and higher profits. At least on the 1/2 ton. The coming CAFE regulations will strangle the 1/2 truck as it is. Even all aluminum and with a small V6 Turbo or diesel they will not make the needed numbers as they are.
The future will consist of smaller trucks. We also will see the prices of the 1/2 V8 models continue to increase. We may see some of the companies try to get more people into the HD models as the heavier class trucks do not have the same fuel regulations.
As for the Diesel they will be here but they will only get more expensive and possibly limited in some areas like California and states adopting their emission standards. The EPA hates Diesels in this country and that is a shame as it would really help in the future but even now they are starting to get priced out. I have seen the replacement parts on the new trucks and the prices are our of this world on their exhaust and other parts.
Ford and GM both have a small truck available now and Dodge/Fiat has nothing. At some point I expect them to make a move here too.
10 years from now the truck market will be very different.
I have noted both Ford and GM truck engineers speaking often on mass. This is the key to their future. The reality is they may go to aluminum but we will never see a Carbon Fiber truck. Even all aluminum has it’s limitations and size will be the only way to less mass.
As we are seeing now with all V8 model cars the price will increase to limit sales. There are few cheap v8 models now and there will be less in the future.
I was just thinking now that the weather is better and incentives in place what are we going to argue about when the sales also spike?
Price is everything and we will see that the first week of May.
The game plan for winning the “sales race” with Ram is to…[drum roll]…offer more incentives. Of course. It worked in the 80s and 90s didn’t it? Okay…full speed ahead. [sigh]. A LOT of folks should lose their jobs at GM over these trucks. Bob Lutz always said that when you produce a car you should spend extra time and money getting it perfect…not just on par with the competition…but better than the competition. And when you have it just right you can charge more for it. The superior product will sell well regardless. But no sooner than Maximum Bob departs, the non-believers went ahead and designed an also-ran vehicle and thought they could fool the buying public AND charge more for it. I am abundantly proud of the American public for starting to shun a product that is not worth their money.
Richard even if you get it right people will still shop for the best deal.
How many retailers sell top quality products at a little higher price and get run out of town by Walmart?
Many of the people also complain the loudest about Walmart are the very same ones who shop there.
The bottom line is people shop for the best price a lot more than you give credit. This is how Hyundai has come around as they have a good car but not a spectacular car but the price is right and cheaper than Honda and Toyota.
In this economy prices are up and income has dropped so the dollar is tighter and will get even more tighter. Price is going to be king here as people can not continue to pay higher and higher cost when their income is not increasing at the same rate of inflation and their heath care, fuel prices and other items are increasing in cost.
Even other MFG see this as they have many customers down sizing their purchases. Benz and Audi both have now gone and offered cheaper models. The new Audi 3 has a discontented model at $29K to catch people that can no longer afford the more expensive models.
The Chevy truck is fine but just too damn expensive. Read any of the creditable reviews and they all praise the truck. The only people who really snipe are those disappointed in the styling not going far enough. I too feel they left some on the table there but this truck looks no worse then the last that sold well at cheaper prices. Hell the new interior inside was a major improvement over the last model.
Watch what happened this month with the incentives and you will see it was price.
The expression, “The more things change, the more they stay the same”, is what comes to mind with GM. Sorry to say. How long til they’re in trouble , again?
According to TrueCar.com’s estimates, Chrysler’s overall average incentive spending wasn’t particularly out of line — a little higher than Ford’s, a little less than GM’s.
Chrysler may have kept its discounts on some models modest. But the incentives on its Ram pickups were another story. Bloomberg reported on Tuesday that J.D. Power estimates put Chrysler’s average spending on incentives for the Ram 1500 at $5,598 per truck — 35% more than Ford’s spending on the F-150, and 46% more than GM’s spending on the Silverado.
The strategy worked: Ram sales rose 26% in March. But at what cost to Chrysler’s bottom line?
62vettefp, “The strategy worked: Ram sales rose 26% in March. But at what cost to Chrysler’s bottom line?”
That’s a good point you make there.
In the future I see the bottom line coming more and more in play.
If the companies end up needed to move customers away from the traditional 1/2 ton full size they will have to make more money per unit to keep the profits up. The smaller trucks will provide income but not as much since they will also be lower volume.
We really need to watch the strategy going on here as the companies are telling the whole story.
GM now has a small truck and will go Aluminum with higher prices on the large trucks. Ford will have Aluminum next year with a real possibility of the Ranger coming here at some point since it was readied for this market.
Ram at this point has not gotten their plan far enough along yet but I suspect they too will have a small truck at some point. FIat is a little farther behind in their moves than GM and Ford.
There is a lot going on we have not been shown and a lot to be done. Even possible changes in CAFE that are coming could move this plan faster.
This is something we all need to look 10+ years ahead to get a feel of where this is going. We also need to understand the rules that are coming and have to be met.
Here is what the financial world is saying.
“Big discounts led to big sales for Chrysler
According to J.D. Power figures reported by Bloomberg, Chrysler’s incentives on the Ram 1500 averaged a whopping $5,598 per truck, 35% higher than Ford, and 46% more than GM.
Now, many of the individuals who buy pickups for their own use have strong brand loyalty. It takes more than a fat discount to get loyal Chevy (or Ford, or Ram) drivers to switch brands.
But commercial fleet buyers are much more price-sensitive. A lot of pickups are getting sold to general contractors and oilfield-services companies and the like right now. For those buyers, who might be buying three or four pickups at a time, a fat discount can make all the difference.
GM’s pickup incentives used to be among the highest in the business. But the all-new 2014 Silverado and Sierra were supposed to change that. They’re much better trucks, GM reasoned, so we’re going to ask higher prices for them.
That has worked out pretty well for GM — at the upper end of the pickup market. GM is selling a lot more loaded trucks than it used to, and it’s getting much better average transaction prices for them. Long story short, it’s making much more money per truck than it did on the old Silverados.”
http://www.fool.com/investing/general/2014/04/05/how-chryslers-ram-crushed-the-chevy-silverado.aspx
Like I said price as money talks BS walks. It is a very price sensitive world anymore. Also fleet sales are very price sensitive and much less profitable.
I expect the rebates to remain till the built up inventory is down and they will pull back some of it. This was more about moving backed up trucks on the lots and not beating Ram. GM is more worried about unsold product build up vs. bragging rights. That is for the Web Forum CEO’s that only have to account for a couple factors and not all factors like the need to shut a plant down for a week or two etc.
These trucks will bounce back. Despite all our criticism about conservative styling, the reviews do state that their are indeed good trucks. And don’t forget, the 2500 HD already is considered to be better than its competitors even without that engine upgrade, in towing and performance wise.
So, despite the criticism, Chevy’s Silverado is still notably better than its competitors.
Example: the 1500 with the 5.3 will still tows more than the Ram with the eco diesel. 11700 VS 9200. Besides, when the Chevy get outfitted with those 8 and 10 speeds with a little power bump, the ram will have no major advantages, even with its 3.0 diesel.
I am confident that GM can deliver by 2016. I do hope, that their engineers are frequent readers of this forum though.
Ram maybe a better truck now that Fiat has more control since I bought my 2007 Ram. My former Ram came from the factory with a few defects. I purchased a new 2013 Silverado and like it much better than the RAM and NO defects found in my Chevy so far.
Fiat and better do not go together.
Fiat themselves are not the most financially stable company in Europe right now. They are the Chrysler of Europe.
Rock solid Quality and Reliability has never been Fiat strong suit. I think many were hoping that some of Chryslers quality would rub off as their was better to start with.
Chevy has had a “Window of Opportunity” to gain marketshare Butt all they have done is Lost!!!
Arrogance has cost GM n the continuous shuffling of marketing execs has resulted in muddled marketing n inconsistencies… Just look at the results… Ram Beat u GM!!!
The window is closing soon when Ford launches the 2015 F150 that continues to be the darling of the media… Just look at the Tonight Show n Jimmy Fallon’s choice F150 King Ranch is awesome!!!
When the new F150 arrives GM will not be able to buy enough media to counter the exposure Ford will continue to get n the CnC twins launch will suffer from it!!!
Just continue the discounting deeper n deeper n get suckered into Rams game n GM will cannibalize the CnC launch n suffer eroded profits… A double edge sword with no solution!
Greg it is not fair to blame the present people incharge for something that to be honest is not fully investigated yet.
Mary has done everything just a they should have done at this point and has hit it head on. They are now sorting out something that happened 12-14 years ago and may have not even got out past middle management.
To be honest the media has railed GM and convicted them without one giving all the facts and two with out even knowing all the facts.
I do agree GM marketing still needs a lot of fixes in different areas like how they are dealing with the Volt etc. but in this case what else can they do till they get all the facts and the independent audit done.
They are fixing all the cars and even offering loaners on cars they have not made for years. What else with in reason shoul they do?
What GM is trying to do on price is what they all need to do and Ford will follow the same path next year too as they will not want to put incentives on their new truck and they will have a much higher price.
The major concern I have is not so much the full size trucks but will the plan with the smaller trucks work. No one really knows. I love the smaller trucks but they need a lot more to love them just than me. They rolled the dice and if It works they will be praised for being innovative and if it fail they will be charged with being misguided.
Much of the future rides on pricing as a lower full size price will for sure hurt the smaller truck sales.
You can continue to rub hamburger all over the trucks to get the dogs to play with it but they too at some point need to make a move and changes to stop the rebate bleeding.
Note the Ram is a new truck too and has relied on incentives even longer than GM. The key is the rebates will not work in the future as they need to cut sales of the larger trucks at some point as they can not remove enough mass to support the coming CAFE averages with the V8 trucks. Aluminum will help but not fix the issues. I see the small truck being the past GM is already on and Ford will soon follow. Fiat who knows.