Incentive spending at GM continues to trend downward, with the value of available incentives for the automaker’s Chevy brand falling by more than 60 percent in the first quarter of this year.
The average incentive offered on a Chevy vehicle in Q1 2022 stood at $1,725 per vehicle, according to Cox Automotive, which was down 62.8 percent from Q1 of 2021, when the impacts of the semiconductor chip shortage had yet to fully take hold. Incentive spending at Chevy was also slightly lower than the average between all four of GM’s brands of $1,966 per vehicle. Just as in Q4 2021, strong demand and tight inventories led GM to slash incentives significantly across all of its vehicle brands.
With fewer incentives on offer, it’s no surprise that sales of GM’s highest-volume brand were also down in Q1. Chevy sales dipped by 20 percent year-over-year to 340,309 units for the quarter. Only three Chevy vehicles posted sales increases: the Suburban (rising 12 percent to 12,424 units), the Tahoe (rising 4 percent to 23,979 units) and the Corvette (rising 33 percent to 8,811 units). The Silverado had a slight sales decline of five percent to 118,796 units, which was likely driven by a lack of inventory rather than falling demand.
GM’s U.S. sales totalled 509,108 vehicles in the first quarter, down 20 percent from the same time last year and far behind the all-time sales record for Q1 of 715,794 vehicles, which it recorded back in Q1 of 2018.
Low inventory and high demand leave little reason for a brand like Chevy to offer steep incentives, as many dealers are easily selling out of their available stock without having to entice customers with discounts. Seeing as automotive production is expected to remain low in 2022 amid continued chip supply issues, it’s unlikely incentive spending will rise very much at Chevy this year, or at any of GM’s four brands, for that matter.