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'Discount' ploy could bite Detroit; Sales surge on new auto incentives, but Big 3 must devise exit strategy.

Publication: Advertising Age
Publication Date: 11-JUL-05
Format: Online
Delivery: Immediate Online Access
Full Article Title: 'Discount' ploy could bite Detroit; Sales surge on new auto incentives, but Big 3 must devise exit strategy.(News)(Column)

Article Excerpt
Byline: BRADLEY JOHNSON

The Big 3's "employee-discount'' play is a simple but effective marketing idea that resonates with consumers, resulting in the most sizzling summer of sales Detroit has seen in years. But if the campaigns escalate into a war, profits will be a big casualty.

Good news: Right now the incentives don't cost automakers that much more than the worn-out promos they replaced (see "Price of Promotions,'' right), and are clearly more appealing to consumers-witness the 41% uptick in June sales at first-adopter GM. Its incentives were "flat to up slightly'' vs. May, but since the automaker trimmed lease expenses and got dealers to...

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