DETROIT - Despite fresh incentives, General Motors is not likely to reach its goal of 30 percent of the U.S. market in calendar 1998.
'If you look at what we have to do to get to 30 percent,' said John Middlebrook, GM's vice president of vehicle brand marketing, 'I think you'll see that it is a pretty high number.'
To boost December sales, the automaker last week increased cash rebates and lowered loan rates on many 1999 models. (See incentive tables on Page 41.)
'They're obviously going to buy themselves some market share,' said Jim Hall, an analyst with AutoPacific Inc., a Santa Ana, Calif., consulting firm.
If other auto companies match GM's incentives, Hall said, 'We could be looking at a price war, or at least a small battle.'
GM boosted the cash rebate on the 1999 Chevrolet Malibu from $500 to $750. Instead of rebates, buyers of 1999 Malibus and some other 1999 Chevrolet vehicles can choose cut-rate financing reduced from 1.9 percent to 0.9 percent on a 36-month loan.
Cadillac put cash incentives of $2,000 to $3,000 on all of its 1999 models except the Catera and Escalade sport-utility. The 1999 Catera is not yet on the market.
Buyers of the 1999 Pontiac Grand Am now get 0.9 percent financing on 36-month loans. 1999 GMC Jimmy four-door buyers can choose between a $1,000 cash rebate or 0.9 percent financing on a 36-month loan.
'We're concentrating on the month of December and trying to get over 30 percent for the month,' Middlebrook said.
GM executives have repeatedly said that their sales goal is a 30-plus share of the U.S. market.
Roy Roberts, GM's executive vice president of sales, service and marketing, has said the automaker needs at least a 30 percent market share to cover its fixed costs.
'There is no plan B,' Roberts told Automotive News. 'We have to do it. If we don't, it (the restructuring of GM) is a failing propo-sition.'
Through November, GM held 29.3 percent of the U.S. automotive market, compared to 31.3 percent during the same time period last year. Both figures include sales of Saturn Corp. and Saab Cars USA Inc.
Middlebrook said a lack of invenventory caused by two-month UAW strikes this summer and an incentive-fueled market are keeping GM from attaining its sales goal.
GM has too many of some models and too few of others. For instance, it has a 132-day supply of Chevrolet Camaros. But it has a two-month backlog of orders for the Chevrolet Silverado pickup, he said.
PUSHING THE TRACKER
Middlebrook assessed GM's market share here last week at a luncheon where he announced that the automaker will launch a $25 million ad campaign next year for the all-new Chevrolet Tracker.
The market for small sport-utilities has grown by 36 percent since 1996, Middlebrook said.
Chevrolet will try to more than double Tracker sales from about 22,000 this year to 50,000 in calendar 1999.
Middlebrook also said GM will unveil an all-new Chevrolet Impala on Jan. 4 at the North American International Auto Show in Detroit.
When it debuted in 1958, the Impala helped Chevrolet by itself gain 30 percent of the U.S. car market. Middlebrook said: 'My, how times have changed.'