Suzuki, Mitsubishi Urged to ‘Forget America’ as Sales Slump
07-12-10 | 11:12 AM
#16
Here is where the end of Mitsubishi began.
What were they thinking?
In the United States, Mitsubishi had created a popular "0, 0, 0" credit program: zero money down, zero payments for one year, and zero interest for one year. This offer attracted young buyers; 16.4 percent of American buyers of Mitsubishi vehicles in 2003 were under 25 years old. Disaster threatened to overwhelm Mitsubishi's American operations when buyers, especially young ones, defaulted on these generous loans. This meant not only that Mitsubishi had received no money for a year on cars that it had sold, but also that it had a host of used vehicles that were not worth the cost of manufacturing them.
07-12-10 | 11:25 AM
#17
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Posts: n/a
Its a desperation tactic to sell cars. GM/Ford did it and we saw what happened. Toyota is using it now I think and so is Acura.
Not good. It kills your resale value for used cars since the new cars are cheaper. It also means you are selling on price, not product and people that pay on price are much more likely to leave your brand for another based on price.
I TRIED to find a Kizashi manual, I can't find one. There were only 4 I think on the lot.
Not good. It kills your resale value for used cars since the new cars are cheaper. It also means you are selling on price, not product and people that pay on price are much more likely to leave your brand for another based on price.
I TRIED to find a Kizashi manual, I can't find one. There were only 4 I think on the lot.
07-12-10 | 11:39 AM
#18
Lexus Test Driver
Joined: Apr 2006
Posts: 1,402
Likes: 1
From: southern cali, san gabriel valley
it's such a simple concept, such a simple disparity yet huge companies with so called huge talent just don't get it.
it all comes down to design, starts with design and finishes with design.
u figure price, quality and warranty would play a big factor but it doesn't. look at benz and bmw, high cost, low warranty, low re-sale, but they still sell like hot cakes.
and to add, a great design is useless if the head decision maker cannot identify it.
it all comes down to design, starts with design and finishes with design.
u figure price, quality and warranty would play a big factor but it doesn't. look at benz and bmw, high cost, low warranty, low re-sale, but they still sell like hot cakes.
and to add, a great design is useless if the head decision maker cannot identify it.
07-12-10 | 11:41 AM
#19
Lexus Test Driver
Joined: Apr 2006
Posts: 1,402
Likes: 1
From: southern cali, san gabriel valley
how is toyota and acura using same tactic, they are offering 0 apr on a few of their models but that's about it.
Its a desperation tactic to sell cars. GM/Ford did it and we saw what happened. Toyota is using it now I think and so is Acura.
Not good. It kills your resale value for used cars since the new cars are cheaper. It also means you are selling on price, not product and people that pay on price are much more likely to leave your brand for another based on price.
I TRIED to find a Kizashi manual, I can't find one. There were only 4 I think on the lot.
Not good. It kills your resale value for used cars since the new cars are cheaper. It also means you are selling on price, not product and people that pay on price are much more likely to leave your brand for another based on price.
I TRIED to find a Kizashi manual, I can't find one. There were only 4 I think on the lot.
07-12-10 | 11:54 AM
#20
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Posts: n/a
http://www.acura.com/tools/shopping/currentoffers.aspx
, down etc..sign and drive....Toyota dealerships are throwing money at customers. I've had some good discussions with dealers there and for Lexus about tactics to keep customers buying Toyotas (recall mess)
Last edited by LexFather; 07-12-10 at 12:06 PM.
07-12-10 | 12:08 PM
#21
Lexus Champion
Joined: Aug 2006
Posts: 11,344
Likes: 142
From: Illinois
Its a desperation tactic to sell cars. GM/Ford did it and we saw what happened. Toyota is using it now I think and so is Acura.
Not good. It kills your resale value for used cars since the new cars are cheaper. It also means you are selling on price, not product and people that pay on price are much more likely to leave your brand for another based on price.
I TRIED to find a Kizashi manual, I can't find one. There were only 4 I think on the lot.
Not good. It kills your resale value for used cars since the new cars are cheaper. It also means you are selling on price, not product and people that pay on price are much more likely to leave your brand for another based on price.
I TRIED to find a Kizashi manual, I can't find one. There were only 4 I think on the lot.
07-12-10 | 12:41 PM
#22
Acura has 0 everything right now and did so in June
http://www.acura.com/tools/shopping/currentoffers.aspx
, down etc..sign and drive....Toyota dealerships are throwing money at customers. I've had some good discussions with dealers there and for Lexus about tactics to keep customers buying Toyotas (recall mess)
http://www.acura.com/tools/shopping/currentoffers.aspx
, down etc..sign and drive....Toyota dealerships are throwing money at customers. I've had some good discussions with dealers there and for Lexus about tactics to keep customers buying Toyotas (recall mess)
Invoice and under for '11 Camry's and 0%.Two friends,two relatives and me have bought a Camry in the past 4-5 weeks.
The Kizashi didn't get a good review in one of the big 3 car magazines recently.
07-12-10 | 03:03 PM
#23
Lexus Fanatic
Joined: Oct 2003
Posts: 91,718
Likes: 90
From: Virginia/D.C. suburbs
Originally Posted by 1SICKLEX
Its a desperation tactic to sell cars. GM/Ford did it and we saw what happened. Toyota is using it now I think and so is Acura.
Acura has 0 everything right now and did so in June
Not good. It kills your resale value for used cars since the new cars are cheaper. It also means you are selling on price, not product and people that pay on price are much more likely to leave your brand for another based on price.
Acura has 0 everything right now and did so in June
Not good. It kills your resale value for used cars since the new cars are cheaper. It also means you are selling on price, not product and people that pay on price are much more likely to leave your brand for another based on price.
I agree the tactic is risky, but it doesn't have to be.....simply restrict it to those with decent credit ratings. When you tempt people on poor credit (and risky finances) with 0/0/0 terms, of course you are going to get more "sales"......and more defaults.
07-12-10 | 03:06 PM
#24
Lexus Fanatic
Joined: Oct 2003
Posts: 91,718
Likes: 90
From: Virginia/D.C. suburbs
It gets mixed reviews, depending on what publication/review/magazine you are reading. I reviewed one myself last winter and was generally impressed with it.....it is a nice, rather, small car, though marketed as a mid-size. And it has better fit/finish than any American-market Suzuki I've seen to date.
07-12-10 | 03:34 PM
#25
It gets mixed reviews, depending on what publication/review/magazine you are reading. I reviewed one myself last winter and was generally impressed with it.....it is a nice, rather, small car, though marketed as a mid-size. And it has better fit/finish than any American-market Suzuki I've seen to date.
Resale may be bad,though.
07-12-10 | 04:51 PM
#26
Its a desperation tactic to sell cars. GM/Ford did it and we saw what happened. Toyota is using it now I think and so is Acura.
Not good. It kills your resale value for used cars since the new cars are cheaper. It also means you are selling on price, not product and people that pay on price are much more likely to leave your brand for another based on price.
I TRIED to find a Kizashi manual, I can't find one. There were only 4 I think on the lot.
Not good. It kills your resale value for used cars since the new cars are cheaper. It also means you are selling on price, not product and people that pay on price are much more likely to leave your brand for another based on price.
I TRIED to find a Kizashi manual, I can't find one. There were only 4 I think on the lot.
0% APR just shifts the cost to future years as you expect your increase in sales to make up for it. Typically it works out alright to get through a slow period as long as things "recover".
Assuming a company sells its cars for a 10% ROR. Giving 0% on what would otherwise be a 4% loan for 60 months on a $50,000 car only costs $1,049 a year, $5,249 total, or a NPV10 of $3,980.
Considering your cost is spread out over the life of the loan, that's pretty cheap if you can get people to pay close to MSRP rather than the typical close-to-invoice price.
Last edited by Infra; 07-12-10 at 05:10 PM.
07-12-10 | 08:22 PM
#28
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Posts: n/a
No, I get that. But Mitsubishi did no payments for a year. It's not even close to the same as just 0 down 0% APR - especially when so many of the buyers paid $0, and then defaulted immediately.
0% APR just shifts the cost to future years as you expect your increase in sales to make up for it. Typically it works out alright to get through a slow period as long as things "recover".
Assuming a company sells its cars for a 10% ROR. Giving 0% on what would otherwise be a 4% loan for 60 months on a $50,000 car only costs $1,049 a year, $5,249 total, or a NPV10 of $3,980.
Considering your cost is spread out over the life of the loan, that's pretty cheap if you can get people to pay close to MSRP rather than the typical close-to-invoice price.
0% APR just shifts the cost to future years as you expect your increase in sales to make up for it. Typically it works out alright to get through a slow period as long as things "recover".
Assuming a company sells its cars for a 10% ROR. Giving 0% on what would otherwise be a 4% loan for 60 months on a $50,000 car only costs $1,049 a year, $5,249 total, or a NPV10 of $3,980.
Considering your cost is spread out over the life of the loan, that's pretty cheap if you can get people to pay close to MSRP rather than the typical close-to-invoice price.
I reviewed the Galant and Outlander and they were some of the worst new vehicles I had driven. I could not believe they were NEW vehicles
07-13-10 | 10:12 AM
#30
Lexus Fanatic
Joined: Oct 2003
Posts: 91,718
Likes: 90
From: Virginia/D.C. suburbs