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What does it cost to be #2?

by David Zatz on

As the market for full-size pickups is slowing down, Michigan automakers are slamming cash on the hood to fight for market share, reducing the profitability of their most lucrative vehicles.

Last month, Ram bought its #2 U.S. sales position with an average incentive of $7,082, higher by 29% than incentives in September 2015, according to Bloomberg News. Those numbers don’t come close to the $10,000 Ford used to clear out old pickups last year, but is still high.

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The incentives were costly, but worked — Ram sales shot up by 29% while Chevy’s Silverado fell by 16% and Ford’s F-series dropped by 3%.  (General Motors pickup sales are still higher than FCA’s, since similar pickups are sold by GMC as well.)

Automotive News reported that pickup profits may be as much as $10,000 per truck. However, GM boosted its Silverado incentives to $5,647 last month, while Ford dropped F-series cash slightly to $5,173.  Some analysts have said that, due to the more expensive costs of aluminum and manufacturing with aluminum, Ford may have less flexibility for incentive spending.

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