GM

GM & Chrysler hold merger talks

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General Motors has held discussions about acquiring Chrysler, The New York Times and Wall Street Journal reported late Friday.

The talks between GM and Cerberus Capital Management, which owns Chrysler, began more than a month ago, the Times reported on its Web site.

The Journal reported that the talks were “rendered inactive” because of the upheaval in financial markets but that people familiar with the developments said the talks could be revived quickly if markets stabilize.

Two people close to the talks told the Times the chances of a merger were “50-50.”

Sources:
From MSNBC
FULL Article from NY Times

“Holy Auto Merger Batman!” Can you imagine how things will turn out if this happens…will GM quality drop to Chrysler standards? Or will Chrysler quality raise to GM standards? Or perhaps they are both too low to matter? Either way they shakes out, I am suspecting that GM may be on the verge of pulling out of leasing completely.

Ford, GM August sales drop

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From the AP

DETROIT – Ford Motor Co. said Wednesday its U.S. sales fell 26.5 percent in August, as the struggling automaker’s results — even worse than July’s dismal figures — showed that the U.S. auto sales slump may not have bottomed out.

Toyota’s sales dropped 9.4 percent from August of last year, a further indication that the woes in the U.S. auto market are continuing, but Nissan — the only major automaker to show a sales gain in July — reported another improvement, with a 13.6 percent increase in August sales.

Meanwhile, General Motors Corp. reported a 20.3 percent drop in sales from a year ago but a 31 percent improvement over its July totals, mainly thanks to offering all buyers employee pricing on many models.

Ford sold 155,172 light vehicles last month, down 3.6 percent from 160,990 in July, which was the industry’s worst month for U.S. sales in 16 years.

The Dearborn-based automaker said its Ford, Lincoln and Mercury car sales dropped nearly 9 percent, while truck sales were off more than 32 percent last month.

The company also doesn’t expect a sales rebound in the second half of the year. It said Wednesday that it plans to cut 50,000 more vehicles from its production plan in the second half of the year, reducing its output to 890,000 in the last six months of 2008.

FULL ARTICLE

Funny how Nissan is the only automaker to post a rise in sales. I must be because of the attractive leases and low APR financing (Like the  EX). Overall, this article clearly shows that most americans are shifting over to more fuel efficient cars than ever before. I just hope most people doing so aren’t panicking and taking a major loss on their SUVs.

The Most Reliable Brand?

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Consumer Reports’ most reliable brand is Honda, followed by Acura. No big surprise there. It is well-known that Honda makes great cars, so I won’t disagree with Consumer Reports on this one. A few brands seem out of place, like Buick rolling in at 10th.

Here is a quick summary of the top 10 most reliable brands.

  1. Honda
  2. Acura
  3. Scion
  4. Subaru
  5. Toyota
  6. Lexus
  7. Infiniti
  8. Mitsubishi
  9. Porsche
  10. Buick

Buick sticks out like a sore thumb here. Considering Buick is a GM, that’s some serious reliability there.
So who are the bottom-feeders of the list?

  1. Land Rover
  2. Hummer
  3. Cadillac
  4. Mercedes Benz
  5. Pontiac
  6. Volkswagen
  7. Chevrolet
  8. Jeep
  9. GMC
  10. Suzuki

What I find surprising is how GM has 50% of the crappiest brands out there. OUCH! I take back what I said about GM not making crappy cars. What is interesting to see is that only one Japanese automaker on the 10 worst list is Suzuki, which also happens to be 10th worst (not exactly bad if you ask me). We also see only 2 Germans and the rest are all American. That’s 70% of the of that list. Pretty sad.

Keep in mind that it doesn’t mean ALL cars of that brand are bad, the CR report gives you a visual range of how good/bad this brands models are.  For example, Pontiac has the widest range of good-to-bad models of any manufacturer, with the Solstice being pure garbage and the Vibe being their best model (It’s no coincidence since the Vibe is the Toyota Matrix’s cousin).

CR brand reliability report [PDF]

Your thoughts?


GM Employee Pricing For EVERYONE!

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By now you have probably seen the commercials. This program ends Sept 2nd 30th.  It is a good time to buy a GM vehicle. They aren’t all crappy cars…REALLY! It’s like picking apples, we know apples can be good, just make sure you don’t pick one with a worm in it.  GM is serious about pushing sales right now (they must be hurting real bad this quarter) because they are having a clearance on EVERYTHING that’s a 2008 ! YUP! you can get a hefty 10k off MSRP on the Corvette, yes, even the Z06. Some 2009 models are included, like the Cobalt and the Caddy CTS, HRR and Vibe (Toyota Matrix’s American relative). Looks like they aren’t holding back this time.

Click here to see available models and how much they are being discounted.

This is probably one of those few times when I’ll be pitching an American car, so at least take the time to check it out. I don’t recommend all GMs obviously, but in that list, there are a few cars I would personally like to have in my garage. Here’s a short list…

  • Caddy CTS
  • Chevy Corvette
  • Pontiac G8 GT
  • Saturn Sky Red Line (which happens to have an additional $500 bucks back)
  • Pontiac Solstice GXP ($500 bucks back too on top of the employee discount)
  • GMC Acadia ($1500 cash back + employee pricing)
  • Chevy Malibu

There are more cars on my list, but I am tired of listing them since they are re-badged versions of these same cars.

Now the questions is, does employee pricing + cashback work with leases? That I don’t know. Maybe a dealer might be kind enough to share some of that insight?

Ford and GM to Make Leases More Expensive

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Article from LA Times states that Ford and GM will begin raising prices on some of their cars (particularly trucks and SUVs) to make them less attractive. They aren’t getting out of the leasing game like Chrysler did, but it doesn’t look good if you are shopping around for an American car to lease. Of course, you can still lease from a 3rd party lender, so it is not the end of the world. What I find rather funny is that American cars have not been leasing well through most of the year anyway (with the exception of Hummers, which they are trying to unload desperately), so this move will only make those leases worse. If you are looking for that Cadillac CTS or Hummer H3, better do it sooner than later.

June 2008 Lease Rate for 08 Hummer H3

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36mo/12k – lease rate 2.75% ( 0.00115) – residual 60%
36mo/15k – lease rate 2.75% ( 0.00115) – residual 58%

My Take: Haahaa. 60% and 58% residuals for a car that may be discontinued in the near future? I guess it could become a collectors item…then again, gas prices will probably dictate it’s value down the road, which isn’t looking very good right now. If you plan on leasing a Hummer, the numbers are really good right now, but you will probably end up paying all that back in gas. Hopefully, you don’t have to commute far if you decide to get one of these behemoths. Expect lease payments of around high-300s to low 400s with the typical drive-off.

June 2008 Lease Rate for 2008 Chevrolet Malibu

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24mo/12k – money factor .00131 (3.15%) – residual 64%
36mo/12k – money factor .00131 (3.15%) – residual 54%

My Take: The Malibu is actually a very good looking car compared to it’s predecessor. It has a much higher quality feel compared to many of the GM cars out there. Since it’s a relatively new car, reliability is still in question. However, if you are looking for an alternative to the Altima, Camry or the Accord, the Malibu isn’t half bad. The MF is decent and the 24mo lease seems to hold a rather high residual value. The 36mo lease seems to take a huge 10% hit in residual value, but spread over an extra 12 months will still make the payments lower than the 24mo lease.

May 2008 Lease Rate for 08 Cadillac Escalade

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36mo/12k – residual 58% – money factor 0.00256
36mo/15k – residual 56% – money factor 0.00256

* $850 lease cash.
** $1,000 if you are current GM customer.
*** Rebates are stackable.

My Take: 6.15% lease rate is good enough to deter me from anything that comes out of GM, even with the cash incentives. The Escalade is the ultimate pimp mobile of the 21st century.  If you dig that, then this is the ride for you. I, on the other hand, don’t want or need a full-size SUV of this magnitude. Plus, I don’t have the income to keep up with this ride’s thirst for gasoline.