General Motors steering away from discounts

DETROIT – General Motors Corp. is offering discounts and no-interest financing on selected models as the end of the 2006 model year approaches.

But the company said it is sticking to its strategy of trying to keep transaction prices closer to the sticker with fewer incentives than it used in past years.

“There is no nationwide blowout sale planned,” the company said in a statement. “These actions are consistent with our ‘go to market’ strategy of using limited, strategic and tactical incentive programs to remain competitive in the marketplace.”

GM sales dropped 12.3 percent during the first half of this year compared to the same time last year.

The new incentives include cash bonuses for dealers and customers, zero-percent financing for 36 months on some models and up to 60 months on others. On 2006 Saturns, for instance, customers will be offered 10 percent discounts off the sticker price.

On the 2007 Tahoe, Suburban, Yukon and Avalanche large sport utility vehicles, GM is offering $2,000 trade-in assistance, $1,000 in dealer cash and low-interest financing.

Last summer, GM started an incentive war by offering employee prices for all, boosting sales but reducing profits.

The company lost $10.6 billion last year, but earned $445 million in the first quarter of 2006.

DaimlerChrysler AG’s Chrysler Group restarted employee discounts on most of its 2006 models earlier this month, but GM and Ford have yet to follow.

The new GM incentives, effective Wednesday and running until Sept. 5, vary by model on Chevrolet, Buick, Pontiac, GMC, Saturn and Saab vehicles. Hummer and Cadillac incentives began July 6 and run through Sept. 5, the company said.

GM shares rose 81 cents to close at $28.52 on the New York Stock Exchange.