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Chrysler and Ford expand employee-discounts-for-all into Canada
http://www.canada.com/national/natio...d-f6fe22345f9e
Chrysler and Ford expand employee-discounts-for-all into Canada Rita Trichur Canadian Press Wednesday, July 06, 2005 TORONTO (CP) - Ford Motor Co. of Canada wasted little time Wednesday to match rival DaimlerChrysler Canada by offering employee discounts to all Canadian buyers. The Ford Family Plan, which had been presented Tuesday to U.S. consumers, will also include up to $5,000 in other discounts already in place on 2005 Ford and Lincoln cars, trucks and SUVs. The offer opens Friday and runs until the end of the month. It excludes the Ford Mustang and Ford Escape Hybrid, already selling strongly, as well as Ford trucks larger than the F-350. The decision was an apparent about-face as a Ford spokesman had said earlier Wednesday the company had no plans to expand the promotion north of the border. Ford's move followed an announcement by DaimlerChrysler Canada that it is immediately extending employee discounts to all Canadian customers on virtually all 2005 Chrysler, Jeep and Dodge vehicles. Chrysler's Employee Pricing Plus program will also include up to $5,500 in additional dealer discounts until the promotion expires Aug. 1. The employee discount applies to most Chrysler models including - unlike in the United States - the hot-selling Chrysler 300 series, except the high-performance Chrysler 300C SRT8. The discounts vary to as much as 2.5 per cent off the dealer invoice price. The moves in Canada came after Chrysler and Ford in the United States on Tuesday followed the lead of General Motors, whose employee-discounts-for-all program boosted its U.S. June sales to the highest volume in almost two decades. GM spokesman Richard James said the company has no plans to change its Canadian strategy of offering a fuel discount that saves buyers 20 cents per litre up to a limit of 2,500 litres. "The insanity continues," auto industry analyst Dennis DesRosiers commented after the latest moves. "The downside of these programs is that they do lower (profit) margins, negatively impact residual (used-car) values and hurt brand value - and how in the heck do these companies find a way to get out of this game?" DesRosiers said buyers have become "numb" to other incentives such as low-interest financing, and he expects consumers to react positively to the employee discounts. Carlos Gomes, a Scotiabank economist specializing in the auto industry, said the Chrysler and Ford discounting will spur July sales and could force GM to act. "It continues to mean significant improvements in vehicle affordability for the average Canadian," Gomes said, noting that overall Canadian auto sales in the first six months of this year were up about two per cent over the first six months of 2004. The announcement is also good news for vehicle production in the wake of temporary layoffs at both Ford and GM because of slack sales, Gomes added. "It is reducing the inventory levels for industry quite significantly, meaning that you won't have to go through these periodic layoffs as we've experienced this year." |
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