Originally Posted by Dragoneye
Are you talking spontaneously, or from MY to MY?
The concept of dealer inventory is not new, and the company seems to be making positive steps on that topic.
Also while it's nice on paper to have zero cars left at the end of a model year...it's not practical. You need some overlap to suit the walk-in buyers. 2010 was an extended model year, so it's not surprising to see they've got some left over. Yet they are still selling in spades...at a steady pace, without any sort of incentives. Plus, the feature sets of the '10 and '11 MY are almost the same...blending the cars to consumers. So long as they continue to sell a good healthy amount of these cars by the time the '12s are released...they'll be fine. Moreso if they choose to offer MY-end incentives on '11s and '10s.
Sorry for the late reply... The original MSRP is determined when the model is introduced ('04 for the Mustang, '09 for the Camaro). The first two production years of a new model is critical. (I will use the MY05 & MY06 Mustang as an example, don't hate me, its just a good example) Research & Developement is expensive, to say that Ford made a "brand new" Mustang would be a bare faced lie. Ford overlaps drivetrains and redesigns to midigate R&D cost. Think back, Ford never introduced a ground up new Mustang. The '05-'09 bodied 4.6 paid for itself in 05-06 selling 160k and 150k units in those years (07 was strong at 133k). This is when Ford introduced the $1500 cash back bonus, trying to pawn off a tired body style and the tired 4.6, not with a MSRP adjustment but a cash back bonus.
Even though improvements from MY to MY increase the original MSRP, (which improvements from the early 197s were non existent) cash back bonuses are given not to move MY stock, but to move a tired model after profits are being made. Ford was in the safe zone (profit), so cash back bonuses are masked as incentives and not a deliberate, public MSRP adjustment.
Now, those early profits are funneled onto the next drivetrain in '07-'08 and offset the cost of R&D as a whole. 2010 redesign is released and at the intorduction of the redesign in April 09, day 1 buyers are offered a $2000 cash back bonus masked as an incentive when it is actually an MSRP adjustment. Same goes for the 2011, the global block 5.0 will be paid for within the first year. I received my $2000 cash back bonus 2 months before the car was released...
In my opinion, GM won't give a cash back bonus until the 2012 model year. Even though they are in a different situation then Ford was with the '05 Mustang (Profits made from previous years paid to R&D for the '05) GM is doing the right thing.
As I stated before, there were almost 30k unsold 2010 Camaros as of 3 June, since the MY10 was a long MY anyway, MY11 should be cut to 8-10 months, hold out on the MY12 details till the last minute, limit MY11 to 5000-6000k production a month and offer NO cash back until they can and clean up stock in March with 0% APRs....
gotta hit send before my iPhone dies..