General Motors is talking about cutting prices and trying to phase out rebates and incentives.
At the same time, it looks as though GM will have its most successful sales month in quite a while. The "Employee Discount for Everyone'' incentive seems to have hit a home run with consumers. GM's market share for June could be more than 30 percent, compared with less that 26 percent for the first five months of the year.
GM will discover that regardless of what the sticker says, customers are going to want big incentives and rebates. Their dealers know that, and consumers sure know it.
As GM ponders what to do about incentives, its competitors are trying to figure out what they can do quickly to counter the success of the GM price promotion.
It could be that no one likes rebates and incentives except the dealers who are selling a lot of cars and trucks and customers who are buying a lot of cars and trucks. But sooner or later, everyone must realize that incentives - big incentives - are here to stay.
The mark of a popular model will be that you're able to sell it without any incentives. But that won't happen very often. Some car companies have figured out that if they want to sell their products, they must use creative incentives, just like all the other packaged-goods companies.
Customers love today's environment for buying a car. They know there is no better time to buy a new car or truck, and they are taking advantage of the opportunities.
It doesn't matter whether they are cash rebates or pull-ahead leasing. People are taking advantage and buying new vehicles. It's keeping the volume high.
Rather than trying to figure out how to get rid of incentives and rebates, car companies should learn how to use them to keep the momentum going. This year is another barnburner in sales, and I don't think anyone would want to see it drop by several million units for a lack of this type of marketing.
Rebates - along with great products - will get this industry to 20 million sales a year. And it won't be that far in the future.