Clarification: GM 2009 Price Increases

Earlier this week, Mark LaNeve, General Motors vice president of vehicle sales, service, and marketing told GM dealers, Saturn retailers, and the media about a new 0% promotion, the company's evolving production plans, and a 3.5% price increase. The "72 Hour Sale" and production shifts were discussed in a previous story posted two days ago, but conflicting comments in the press, blogs, and forums about the aforementioned price increase caused me to ask a few questions before reporting on the announcement's specific impact on Saturn.

The most important point to remember is that the price increase will only affect 2009 models. The company's 2008 models will finish the year with their current pricing. Some articles were confusing, and led folks to believe that the price increase would apply to the very same vehicles that are being offered with 0% financing until June 30th. That's not the case. The zero-percent financing offer is for 2008 models; the price increase is only on 2009s.

Secondly, the 3.5% price increase is an average figure across all GM cars and trucks. Not all prices will be going up 3.5 percent. Some vehicles will be higher, some will be lower. For instance, sources at Saturn tell that the pricing for the 2009 Saturn Sky will only be going rising 1.2 percent.

When looking at the increase holistically across all of GM, "about half the increase is for additional or upgraded content – including things like OnStar, StabiliTrak, six speed transmissions on cars and trucks, upgraded interiors, and Bluetooth capability, just to name a few," one source said. "The remainder of the increase is due to economics or content we've added to meet government emissions and crash regulations, and to cover the higher prices we're paying."

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Mysterious Ohio Based Investment Group Arises as a Potential Buyer

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Update on May 7th: Leading negotiations for this group is Gary Marvicsin. Detroit News reports that he is employed in the auto industry.

Detroit News reports that there is a mysterious Ohio based investment group interested in acquiring Saturn. Unlike the other interested buyers, this group has developed a concept to keep the company domestically based. According to the article, the group is interested in purchasing domestically abandoned manufacturing plants to produce Saturns. Chrysler plants that are targeted to close due to bankruptcy troubles were specifically mentioned. The group wants to continue to employee UAW workers at these plants. While recognizing the high costs associated with employing union workers, such as benefits and pensions, the group believes that it is the right move for two reasons.