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View Poll Results: Should GM offer 0% financing on all vehicles to help boost sales?
Yes! Offer 0% financing! 222 92.50%
No. It's not necessary (read reasons why in posts below). 18 7.50%
Voters: 240. You may not vote on this poll

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Old 05-17-2009, 11:50 AM   #51
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^...Yes do something to stimulate car sales, people in my family could use 2 new cars right now, but it's not gonna happen they things are right now.
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Old 05-17-2009, 12:18 PM   #52
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Isn't 0% financing begging the question?
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Old 05-17-2009, 12:22 PM   #53
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I think 0% would be a good idea, but at the same time, this might sound bad, but the banks do need money right now. But I think offering 2% APR would stimulate sales and help the banks out(dont get me wrong they dont deserve but im looking at big picture) Also with 0% financing they will probably get their money in other ways.
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Old 05-17-2009, 03:27 PM   #54
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GM has been offering 0% through GMAC consistently for at least three years on specific models. This practice has not helped their bottom line. It's only delayed the inevitable. There is a reason they offer rate or rebate, but not both. GM subsidizes one or the other. GM is not profitable because they stopped making a quality product (ironically, until just recently). All the newest models compare favorably with the competition, including imports: Malibu, Traverse, ZR1, and Camaro.

GM has to get smaller before they can get better (and bigger). The Cruz will be key to the relative success of GM. The Volt should help, as should the Spark and Orlando (1.6l turbodiesel).

If you plan on paying the car off early, take the rebate. If you plan on going the full term of the loan, take the 0%. Google "time value of money".


0% financing is not free. There Is No Such Thing As Free Lunch. 0% financing costs GM real money to subsidize. Real money they don't have. Furthermore, it conditions consumers and teaches them to not buy until 0% financing is offered. GM must shrink to match its new natural market share (which should stabilize and perhaps even expand due to their new high quality products) instead of artificially maintaining a higher volume by unprofitably subsidizing retail sales and making tons of fleet sales. That simply is not sustainable.
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Old 05-17-2009, 03:37 PM   #55
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true GM would get hurt in the long run. Thats why I think low interest rate would feasbile.
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Old 05-17-2009, 11:38 PM   #56
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Right now, I can get 3.7% from Randolf Brooks Fed Cred Union. I am hoping that my regular bank will match that financing. They probably will. USAA said they would NOT do price matching. But, when it comes down to it, they CAN make the loan AND make money off of it. OR.....GMAC COULD lower that financing rate down to 3.5 or even lower to 3% and STILL make money off the loan.
ou do realize that Gm and almost all lenders aren't lending their own money right? It;s not like if you go to GMAC for a loan they give you the cash out of their perosnal accounts. They lend you money they are borrowing from someone else. This is why lending companies tend to do better that have a very strong cash worth. Toyota Financial is a great example, one of the strongest lending portfolios out there.

You give rebates or APR to distressed vehicles that need to be moved, such as slow sellers or previous year models.

The simple fact of the matter is that GM can't afford to lend at stupid low APR's, they don't have the cash reserve for it. Everyone knows it would be in their best interest but that doesn't mean it can be afforded at this time. Let's say you make an average of 2k per retailed unit as a manufactruer (assuming a lot more than that) and you offer low APR, what interest YOU are paying for the money you borrowed to lend to the end consumer is now eatting into your profits.

Someone said it earlier. Low APR and big rebates work on a short timeline, but in the end just devalue your own product. Gm needs to focus on building up their quality and get a decent reputation back before anyone flocks back to their dealerships again.

the business model of discount selling doesn't work in the automotive industry anymore (not long term anyways). It is quickly being replaced by value selling. Some manufacturers need to get on pace with that.
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Old 05-17-2009, 11:53 PM   #57
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A big reason I'm not buying right now is interest rates. If you do the math (which Im not going to do for you, stop being lazy) you pay a lot more than a car is worth if you finance it and it has any kind of interest.

I am thankfully debt free and its an amazing feeling. Nice to know all the money I have coming in is for me and doesn't belong to someone else before I even get it.

May take me a while but I will pay for my next car in cash and will be able to pay what its really worth. Not going to put myself in the hole for any business seeing as they aren't there to help me when times are good for them.
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Old 05-17-2009, 11:55 PM   #58
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The only way I'm buying new is if they offer 0% on the Camaro, our last two GM cars had 0% for 60 months. I think the payment was $16.11 per $1000 financed, and the totals came out to 1-2k under MSRP.

If not I will settle for a used one next year.
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Old 05-18-2009, 08:43 PM   #59
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Ok,

Let's get a little academic on this topic. I've read through all the posts so far and I see very few people who have brought up or understand the Micro and Macro economics associated with this situation....nor would claim to know and understand them completely.

What I do realize is that the American population is for the most part selfish. Anyone who thinks GMAC should offer 0% financing should be taken out in the woods and shot.

Have you all forgotten they are operating off of loans that WE are financing to them? Don't you want your money back? I do, and I want it back from those a-holes on Wall Street too!

The past 5 years of 0% loans have been part of the problem. They have allowed people to buy cars that they otherwise could not have afforded and have eroded the operational capital of the manufacturers.

Zero financing has also caused unrealistic consumer expectations regarding what they can afford and how often they can afford it...and this applies to more than just cars.

Finally, the manufacturers have adjusted their production to meet demand. I suspect that some economists would argue this is artificially inflated demand caused be the unrealistic consumer expectations for price/financing and self-serving immediate gratification. Yes, a vicious loop.

This has caused HUGE amounts of excess inventory, excess personnel that need to be laid off, and suppliers that now have excess inventory and reduced demand for their parts...causing them to lay off personnel, etc. Due to the massive size of the auto industry, the ripple effect is huge.

So before you start "flaming me" for this post, think about the last think you bought. Did you really need it? Was it purchased with discretionary income or are you delaying by extending your credit further? Could you have done without it for another month....another year?

The American consumer needs to "slow their roll" and consider saving prior to buying large ticket items, like cars. It's not hard to plan ahead and save money, especially at the slow pace GM is delivering our camaros.

Flame away.....
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Old 05-18-2009, 10:03 PM   #60
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Quote:
Originally Posted by josh1147 View Post
Ok,

Let's get a little academic on this topic. I've read through all the posts so far and I see very few people who have brought up or understand the Micro and Macro economics associated with this situation....nor would claim to know and understand them completely.

What I do realize is that the American population is for the most part selfish. Anyone who thinks GMAC should offer 0% financing should be taken out in the woods and shot.

Have you all forgotten they are operating off of loans that WE are financing to them? Don't you want your money back? I do, and I want it back from those a-holes on Wall Street too!

The past 5 years of 0% loans have been part of the problem. They have allowed people to buy cars that they otherwise could not have afforded and have eroded the operational capital of the manufacturers.

Zero financing has also caused unrealistic consumer expectations regarding what they can afford and how often they can afford it...and this applies to more than just cars.

Finally, the manufacturers have adjusted their production to meet demand. I suspect that some economists would argue this is artificially inflated demand caused be the unrealistic consumer expectations for price/financing and self-serving immediate gratification. Yes, a vicious loop.

This has caused HUGE amounts of excess inventory, excess personnel that need to be laid off, and suppliers that now have excess inventory and reduced demand for their parts...causing them to lay off personnel, etc. Due to the massive size of the auto industry, the ripple effect is huge.

So before you start "flaming me" for this post, think about the last think you bought. Did you really need it? Was it purchased with discretionary income or are you delaying by extending your credit further? Could you have done without it for another month....another year?

The American consumer needs to "slow their roll" and consider saving prior to buying large ticket items, like cars. It's not hard to plan ahead and save money, especially at the slow pace GM is delivering our camaros.

Flame away.....

EXCELLENT post!!!!
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Old 05-18-2009, 10:07 PM   #61
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Originally Posted by josh1147 View Post
Ok,

Let's get a little academic on this topic. I've read through all the posts so far and I see very few people who have brought up or understand the Micro and Macro economics associated with this situation....nor would claim to know and understand them completely.

What I do realize is that the American population is for the most part selfish. Anyone who thinks GMAC should offer 0% financing should be taken out in the woods and shot.

Have you all forgotten they are operating off of loans that WE are financing to them? Don't you want your money back? I do, and I want it back from those a-holes on Wall Street too!

The past 5 years of 0% loans have been part of the problem. They have allowed people to buy cars that they otherwise could not have afforded and have eroded the operational capital of the manufacturers.

Zero financing has also caused unrealistic consumer expectations regarding what they can afford and how often they can afford it...and this applies to more than just cars.

Finally, the manufacturers have adjusted their production to meet demand. I suspect that some economists would argue this is artificially inflated demand caused be the unrealistic consumer expectations for price/financing and self-serving immediate gratification. Yes, a vicious loop.

This has caused HUGE amounts of excess inventory, excess personnel that need to be laid off, and suppliers that now have excess inventory and reduced demand for their parts...causing them to lay off personnel, etc. Due to the massive size of the auto industry, the ripple effect is huge.

So before you start "flaming me" for this post, think about the last think you bought. Did you really need it? Was it purchased with discretionary income or are you delaying by extending your credit further? Could you have done without it for another month....another year?

The American consumer needs to "slow their roll" and consider saving prior to buying large ticket items, like cars. It's not hard to plan ahead and save money, especially at the slow pace GM is delivering our camaros.

Flame away.....

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Old 05-19-2009, 07:37 AM   #62
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Quote:
Originally Posted by josh1147 View Post
Ok,

Let's get a little academic on this topic. I've read through all the posts so far and I see very few people who have brought up or understand the Micro and Macro economics associated with this situation....nor would claim to know and understand them completely.

What I do realize is that the American population is for the most part selfish. Anyone who thinks GMAC should offer 0% financing should be taken out in the woods and shot.

Have you all forgotten they are operating off of loans that WE are financing to them? Don't you want your money back? I do, and I want it back from those a-holes on Wall Street too!

The past 5 years of 0% loans have been part of the problem. They have allowed people to buy cars that they otherwise could not have afforded and have eroded the operational capital of the manufacturers.

Zero financing has also caused unrealistic consumer expectations regarding what they can afford and how often they can afford it...and this applies to more than just cars.

Finally, the manufacturers have adjusted their production to meet demand. I suspect that some economists would argue this is artificially inflated demand caused be the unrealistic consumer expectations for price/financing and self-serving immediate gratification. Yes, a vicious loop.

This has caused HUGE amounts of excess inventory, excess personnel that need to be laid off, and suppliers that now have excess inventory and reduced demand for their parts...causing them to lay off personnel, etc. Due to the massive size of the auto industry, the ripple effect is huge.

So before you start "flaming me" for this post, think about the last think you bought. Did you really need it? Was it purchased with discretionary income or are you delaying by extending your credit further? Could you have done without it for another month....another year?

The American consumer needs to "slow their roll" and consider saving prior to buying large ticket items, like cars. It's not hard to plan ahead and save money, especially at the slow pace GM is delivering our camaros.

Flame away.....
Absolutely !! This is what caused the housing market crash too.

Just like the clip of the person who has been in Section 8 housing since 1949 and worked 1 year out of 58 (WE, the American people have been picking up the family tab for 57 years including her nice new 50" LCD TV)

"Just because I am poor, doesn't mean I need to live poor" Uh Huh...
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