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Slower sales prompt Saturn to offer savings on L-series

SHARE Slower sales prompt Saturn to offer savings on L-series

DETROIT — General Motors Corp.'s Saturn division is offering price reductions on some models after slower-than-forecast sales this year caused the unit to cut production at two plants.

Saturn is giving dealers as much as $1,000 a vehicle to advertise L-series cars. The $1,000 given to dealers for the 2000 model L-series midsize vehicles can also be used to reduce the vehicle's price, Saturn spokesman Tom Wilkinson said.

The incentives indicate that Saturn is backing away from a one-price policy that has been part of its retail strategy since it began building cars 10 years ago.

If the dealer chooses to use the money to reduce a vehicle's price, that incentive would have to be offered to all customers, Wilkinson said. These types of incentives have been offered before, he said.

"Saturn's problems are bigger than incentives," said Nextrend marketing analyst Wes Brown.

The move was reported in Business Week's July 24 edition.

General Motors stock rose 1/16 to 61 13/16. The Detroit-based company's shares have fallen 15 percent this year.

Saturn's customer satisfaction model has been adopted by other car companies, Brown said.

The unit said in March it would cut in half production of the L-series cars at its Wilmington, Delaware, plant because of slower-than-expected sales.

In May, Saturn said it was laying off 490 workers at the plant.

Also in March, the company said it would cut production of S-series cars at its Spring Hill, Tenn., assembly plant.

Saturn sold 48,133 L-series vehicles this year through June according to Autodata Corp. That number is less than forecast. Saturn is also offering dealers support money for the S-series vehicles, Wilkinson said.

All incentives, direct and indirect, at Saturn totaled $1,116 for each vehicle in June, up from $744 a year earlier, said CNW Marketing Research analyst Art Spinella. The industry average was $2,457 last month.