4-16-03 The Local has scheduled a bargaining preparation meeting involving the Executive Comittee, among others, in Cleveland, May 17, 2003.

4-16-03 The Union has been informed that an attorney layoff will occur in Lordstown, OH in late summer.

4-16-03 Car deals for employees add up (Submitted by Steve Hofer, Indiana).

Car deals for employees add up
Automakers expand worker discounts
By Dave Guilford

Automotive News /

March 24, 2003

How Ford Motor Co. employee discounts work at one dealership

Vehicle: 2003 Expedition Eddie Bauer

Sticker price: $47,105

Dealer no-dicker price: $42,367

Employee price: $39,618

DETROIT - Car shoppers who work in the auto industry are a pampered group nowadays.

Discounts once reserved for automakers' employees have been steadily expanded to dealership employees, supplier employees and others. General Motors recently included, through March 31, immediate family members of dealership employees.

The discounts are useful to attract buyers of competing brands, and their marketing costs can be cheaper than other incentive programs. The discounts are used for 3.5 percent of all U.S. sales, one analyst says.

The newly eligible buyers qualify for deals such as a 2003 Chevrolet TrailBlazer, listing at $28,652, for $21,608 - a 25 percent discount offered in a suburban Detroit dealer's ad last week.

The payment for a 36-month lease on the TrailBlazer, with a sunroof tossed in: $286.

GM's expansion of the program to family members of dealership employees matched a program the Chrysler group initiated last year, GM spokeswoman Elaine Redd says.

"It really was a response to something Chrysler did," Redd says. "That's the primary reason we did it. We're going to do what it takes to be competitive."

About 10 percent of GM domestic sales are to buyers using one of its discount programs, she says. Programs cover GM employees, as well as employees of suppliers, affiliated companies and dealerships.

Conquest sales

Art Spinella, president of CNW Marketing/Research in Bandon, Ore., says about 582,000 vehicles were sold on employee discount programs in the United States last year. That represents about 3.5 percent of total U.S. light-vehicle sales.

Employee-discount programs affect the Big 3 most because they have the most employees, suppliers and dealerships in the United States, Spinella says. Automakers have steadily expanded the programs and probably will continue, he says.

"I thought they were done, but they're finding new ways of doing it," he says.

Though sticker prices are discounted, the programs can be lucrative for automakers, Spinella says. That's because they don't have to pay marketing allowances or holdbacks to dealers in many cases. Automakers also see broadening the plans to include family and friends as a way to make conquest sales. The impact of the progams varies regionally, with Detroit the epicenter. Detroit newspaper ads frequently list employee discounts.

Some big dealers eager to cut inventory have offered the discounts to all customers.

But Frank Ursomarso, a multiline dealer in Wilmington, Del., site of a GM plant, called GM's expanded dealership employee program "ho-hum." Ursomarso's seven brands include Pontiac-GMC.

GM would not give details of employee discounts.

The general manager at a GM dealership says its discounts vary by nameplate, but generally GM employees get a vehicle for less than the dealer invoice price. Other discount programs generally sell the car for the invoice price.

The Chrysler group sees its various vehicle-discount programs as a way to lure relatives of employees and dealership staff from competing brands. The company offers separate discount plans to its corporate employees, dealership employees, suppliers and affiliated companies.

For example, the Employee Advantage program is available to employees, retirees and surviving spouses.

Those eligible may purchase or lease as many as four Chrysler, Dodge or Jeep vehicles annually at discounts averaging 5 percent to 6 percent below invoice price.

The eligible participants may extend the discount to immediate family members including siblings, in-laws, step and half relations.

Supplier discount restricted

For contrast, the supplier discount is restricted to two vehicles annually and applies only to the employee and spouse. Only suppliers that meet various performance and quality criteria are eligible. The vehicle is sold or leased at 1 percent below invoice.

Employees at certified top-performing Five Star dealerships may purchase or lease as many as four vehicles annually at $750 below invoice price, a discount almost as generous as that offered to corporate employees. The deal also is available to immediate family members.

Dealership employees and relatives at stores without the Five-Star designation can acquire vehicles at 1 percent below invoice.

Ford Motor Co. hasn't made any significant changes in the terms of its employee discount programs. Those include the A plan, which is the discount that goes to employees and certain members of their families; and the X plan, the discount that employees can offer at their discretion to friends and extended family members. The X plan is designed to bring in customers from competing brands.