Automaker to cut prices on 30 of its 2006 models

Monday, Aug. 1, 2005 | 9:35 a.m.

General Motors Corp., the world's largest automaker, will cut prices on 30 of its 2006 models, according to people familiar with the plan, as the company stops giving employee discounts to all buyers.

The price cuts, scheduled to be announced this morning, will amount to as much as $4,800 on the Cadillac DTS, people familiar with the details said. The Pontiac G6 gets a $645 reduction, and some models will get less than that, the people said. The automaker will offer a total of 50 models with some combination of reduced prices or added features, extended warranties or other changes at no extra cost, the people said.

"Reducing the haggling that everyone hates should help buyers feel like they are getting the best deal possible while eliminating some of the sales friction from the buying process," said Pete Hastings, vice president of corporate fixed income at Morgan Keegan Inc., a Memphis, Tenn., investment bank.

Today's announcement is part of GM Chief Executive Rick Wagoner's plan to make the prices of GM vehicles more attractive, particularly in Internet comparisons, and rely less on rebates. GM lost more than $2.2 billion making cars and trucks in the first half of this year as it cut North American production to reduce inventories of unsold models.