GM has been hit hard by the recent economic slump. In an effort to keep more dealerships from going the way of Bill Heard, the automaker is planning to cut per vehicle profits to help increase dealers’ profit. GM dealers will pay 1% less than the invoice price on all new 2009 models sold before the end of this year, reports Bloomberg.
A 2009 Hummer H2 has an MSRP of $57,425. A dealer who sells one who would normally owe GM the invoice of $53,118, according to Edmunds.com. With the 1% sales incentive, that dealer would only have to pay $52,587. That’s an extra $531 the dealer is getting for your sale. With less expensive cars, the dealership’s additional profit will be lower; a 2009 Cobalt will only have $141 in additional proft.
This extra profit on every sale means that the dealer has more wiggle room on the price of their 2009 models. Use this in your negotiations with dealerships. If they don’t have to pay as much, neither should you.