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Ford, Chrysler Stung by GM 'Employee Discount' Strategy

Both Rivals Mount Advertising Counterattacks

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DETROIT ( -- GM's "employee discount" promotion, which is pulling more potential buyers into showrooms, has also evoked strong responses from Ford Motor Co. and Chrysler Group.

GM's ad campaign offering 'Employee Discounts for Everyone' appears to have struck a chord with consumers.

Ford and Chrysler have each taken quick action to directly counteract the GM marketing strategy, which appears to have caught the public's attention.

Rival campaigns
Both automakers kicked off new ad campaigns this week touting their own deals and disparaging GM's.

GM's "employee discount" hype on all its 2005 models is attracting more consumers who had Ford, Chrysler or other non-GM brands on their shopping lists, according to CNW Marketing/Research. CNW found that while 57% of all people who entered a GM dealership last June were already GM "intenders," just 37% were intenders this June. That means, CNW President Art Spinella explained, that the new program is drawing increased numbers of non-GM consumers, and that the showroom traffic is less reliant on those who already own GM vehicles.

GM's current deal started June 1 and ends July 5. Interpublic Group of Cos.' McCann Erickson, Birmingham, Mich., handles GM corporate, multi-vehicle brand advertising.

Savvy consumers can probably negotiate with GM dealers for a better deal than the employee discount, said an auto consultant who asked not to be named.

Chrysler's 'Straight Math'
Chrysler Group yesterday announced it started its "Straight Math. Great Product" campaign at its 2006 model preview press event at its proving grounds in Chelsea, Mich. (about 60 miles west of Detroit). The deals cover Dodge, Jeep and Chrysler vehicles and are the same ones the automaker already offered this month, a spokesman said.

GM "has gotten a lot of hype" from its current employee-discounts-for-everyone deal, he said. Chrysler Group's incentives are "superior to what you're going to get from GM and we don't have to add additional money to make that happen or put a gimmicky name on it," he said.

The national print, TV and online campaign from Omnicom Group's BBDO of Troy, Mich., is designed to educate the public about comparing deals from different carmakers.

The spokesman said it's still too early to tell whether GM's current ads are having a negative impact on Chrysler Group sales. Chrysler is seeing increased showroom traffic in June, he added.
On, after clicking on "Summer Sales Drive," the page reads: "You don't need an employee discount to get a great deal from us." Deals on the 2005 Dodge Durango sport utility vehicle include 0% financing for 36 months, $4,000 trade-in bonus cash or $4,000 cash, according to the site.

Ford Division's national TV spot, which broke earlier this week, is themed "The Truth." The commercial plugs record sales of the new Mustang, the F-150 pickup's record as the best-selling U.S. vehicle and the Explorer as the best-selling SUV. The spot segues into the core message: that Ford brands' rebates make them cheaper than GM's employee discount.

WPP Group's JWT of Detroit is Ford's agency for the work. A Ford spokesman didn't return calls by deadline.

Ford Division already has a deal on its pickup trucks, unveiled in late May as a co-promotion deal with Home Depot. It offers buyers of the Ranger, F-150 or Super Duty pickups a choice of one of five gift packages from the retailer valued up to $870. The "Bring it Home" promotion is being heavily advertised on national TV, in print, online, direct mail as well as inside Home Depot stores and Ford dealerships. It runs through Aug. 1 and includes a sweepstakes to win an F-250 Super Crew or $10,000 gift card from Home Depot.

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