Price increase?

[Steve 2]

A friend went to a dealer and they told him there will be a $7000 price increase shortly and that they will be producing only diesels for a few months. Has any one heard the same rumors?

[Steve 2]

A friend went to a dealer and they told him there will be a $7000 price increase shortly and that they will be producing only diesels for a few months. Has any one heard the same rumors?

[Tiger Bait]

There has been speculation that there will be a diesel option available for 2004. $7000 does sound like a reasonable price for that option (it's about 5K on the pickup truck with another $2.5 K for the allison transmission upgrade, I think). I doubt that they would stop production on gas models since in some areas of the country there is a 3 or more month backlog of orders already in the pipe. just my thoughts. /infopop/emoticons/icon_confused.gif

[Texas Red]

There is currently no diesel option for the H2. I don't know what your dealer (salesman?) is talking about when he says "shortly," 2004?? Maybe. He probably doesn't know what he's talking about and just needs to go back to selling shoes!

Jim
Red H2 in Texas

[NSXTC]

I had a salesman say that the Escalade engine makes more HP than the H2. This is true....but wait...

So I asked them how come?

His response?.....

"Because the Escalade weighs less than the H2"

I bought my H2 from another dealer.

[Steve R]

If I had to have a brain transplant.....I'd insist on getting a brain from a salesman....cause I'd want a brain that wasn't used!!

[JJ]

STEVE 2
Sounds like just another attempt to get you to put your money down now...........

I've heard everything from GM putting in the Northstar engine, approx. 30-40 hp more, to adding a diesel option. Plus theres the H2 Performance model, supercharged. And then theres the H3 and H4 models coming soon not to mention the SUT (which appears to be real). Just doesn't seem reasonable to expect that GM could handle all of this - something has to give.

You know, come to think of it I've read that GM will be test marketing the HUMCOPTER. A vertical take-off version of the H2 for short segment commuting - should be a big hit in LA and NY. Rumored to be a gas hog though....

JJ

[DIANE]

humcopter...sounds good to me.It would make my trip to Miami much quicker than driving. My husband could put it in the hanger next to his twin engine Hummer 310.

[Peyton77]

I was at Coral Hummer in South Florida this weekend (Had to get the wife’s formal approval for purchase) They were actually very helpful. The salesman mentioned that a $4K price hike was rumored. I have no idea is this was an effort to make me purchase that day or if there was some truth to it. He seemed like a decent person, but then again he is a car salesman. He also told me that he just delivered #367, and they were the largest volume dealer on the East Coast. Last but not least they had about 25 on the lot, all were sold and waiting for delivery.

Peyton

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[TonkaH2]

In large part, BECAUSE it's a good value at around 50K! They need to at least wait until they have an H3 before they make the H2 cost 60K or more. I know some will spend more, but if they had given the H1 an H2-cushy interior would they be able to sell 45,000 at $110K? I think not. . . they at least need to keep the base model at the price point. And they better not come out with the diesel until I've had mine for a year!!! /infopop/emoticons/icon_biggrin.gif

-Jack
Yellow H2 adv. on order
"I think I can make it. D'OH!"

[BKLYNH2]

Its very interesting to hear the different "stories" everyone has heard from car salesmen. I think everyone should post their experiences for well being of future H2 owners. I had several while shopping for ours. Overall I feel that dealers are partially fabricating demand. One dealer we went to couldn't stop telling us how much over sticker he was getting and how he could not promise to get anyone an H2 within 12 weeks for no amount of money. I saw the same H2 on his lot for three weeks, and this was in September. It could even still be there. I made it clear that we were not paying over list and he could call us if things changed. He called today. For a while I think they embellished the demand to weed out those that they could find to spend the extra five grand, and if that meant the car sat on the lot for three weeks it was worth it for the extra cash. One of the more useful tools I found while searching for my H2 was the gmbuypower.com website. At this site you could see almost every dealers inventory. This gave a good idea which dealers were getting the most cars and how long they were around for.
I think the present price is appropriate. It's a bit more than most other large SUV's(American made), not as lux inside as some but definitley a lot more performance.

[MAC]

Reading between the lines here and elsewhere, there seems to be some respect and desire for diesel Hummer. Why is that? Clearly I am not familiar with diesels, they seem to be dirty, smelly and slow, and diesel fuel is no longer cheaper. One does not want to be behind a diesel Mercedes with a blacken butt or a school bus, just about the only time I turn on recirculation is when I am behind a diesel. Maybe there is some diesel magic that I do not know.

About car salesmen/women. I agree it is a pain to deal with a junior salesman who tries to pretend to be someone he's not, unfortunately one does not know who to ask for when walk into a showroom. I have been lucky in the last few auto purchases. I personally know a few car salesmen who make $200-$300K a year in commission. No.1 factor is not being smart, but having the right brand, Lexus, MB have buyers waiting in line.

[kelleymac2000]

For certain things. They get awesome gas mileage, so all in all they are more cost efficient than gas engines. They also offer a greater towing capacity than most gas engines.

Having grown up in the midwest, I can tell you that trying to pump diesel in the winter is like trying to pump snot...not a lot of fun!

Kelley

[H2Norcal]

I spoke with our dealer in Norcal and they said "you better hurry up because there is gonna be a price increase very soon". That was three weeks ago. To be frankly honest, I didn't believe him. I really think it is GM trying to hit their widely publicized 35,000 production target for the 2003 model. It is the old trick of "make them feel like they gotta have one before the price changes frenzy". Our dealer has well over 12 H2's on their lots and 1.5 times that in H1's. Although they say they sell through about seven a week, there is a good selection right off the lot.

I asked about a diesel. The sales manager of the dealership said that it was going to be very unlikely they offer a diesel for the H2 soon because it would cause a conflict with the H1. He said the diesel is a determining factor for many that buy an H1. A diesel in the H2 would make it hard for anyone to pay an extra 60k for an H1.

[HeeHaw]

I'm so used to seeing you as the Thomas Crown Affair guy, that is seems odd not to see that icon.

HeeeeeeeeeeeeeeeHawwwwwwwwwwwwwww

[MAC]

HeeHaw, I think you are right. My wife says I look like the hat guy, not the punk, maybe the punk is my evil twin brother. I wore a suit and tie every single working day of my life since 20+ after the Army. No hat.

I read in BizWeek, BMW intentionally build less cars than what they estimated the demand is, and it is a common tactic used by premium auto brands to create demand and prestige of the brand. They want people to wait, they control the pipeline to create some waiting.

[HeeHaw]

Pumping "Snot" as Kelly put it is NOT my idea of fun or to steal a line from a movie "Not my idea of a bitch'n time." Whatever, the diesel does have some advantages and it has its shortcomings as well. I too came from the Midwest (Missouri)and I know what cold weather is all about. I do agree with Kelly.

The H2 is WAY TOO popular for the price to remain as low as it is. When I first saw the H2, my first thought was I couldn’t afford that. Then when I found out they were 50-ish, I said I take one and I'll take that white one right there. Here's your check and off I went. I actually laughed thinking I had just bought a vehicle that is probably worth more than I just paid for it!

The price is going up, get used to it!!! For anyone who is thinking of buying an H2, my advice is to buy now and laugh later! If you don't, you may be sorry, unless you are rich. If you're rich, then who cares, buy what you want, when you want and you certainly don't need any advice from me. But for normal folks like me, better get while the gett'n good!! (old Missouri saying)

Mac also brought up a good point when he mentioned the type of car and the fact "Lexus, MB have buyers waiting in line." Good point. All forum members, seek out a MB dealer and price the S500 and see what they say. Be prepared to spend 80,000.00+. That vehicle is perfect example of STATUS and LUXURY all wrapped up into one vehicle. The Hummer will never be an S500, but it popularity will directly affect the price. ITS GOING UP...................soon

HeeeeeeeeeeeeeeeeeHawwwwwwwwwwwwwww /infopop/emoticons/icon_cool.gif

[HeeHaw]

The icon is YOU!

HeeeeeeeeeHawwwwwwwwwwwwwww

[Zing]

With deisel engines I think the appeal is better fuel economy and a simpler engine since for one thing deisels don't require spark plugs for combustion, just pressure. Not compelling reasons for me.

It's a good point about car manufacturers creating artificial demand. It is much like the clubs here in the city that hire doormen to stand behind velvets rope while there are only 30 people inside, yet people are more than willing to wait and pay the high cover because you see the line and think you're missing out on something. The do better at the end of the night than if they would have an open door policy.

Well, I've committed myself to wait for the 2004 and if the price goes up so be it. My bet is that while the H2 can command $60K, I bet they'll keep the price about where it is and charge for a nice premium for the higher horsepower engine and other luxury options.

[cognitive]

I don't think the price of the H2 will go up. I do think however that the 2004 model will have two base models. One will be much like the current H2 and the second will be the one we keep hearing about with the higher quality interior and higher HP engine. The lower end model will appeal to the current market. If it didn't exist, Hummer would basically alienate a huge market. Remember that the Escalade is really the only competition for Hummer and it's priced slightly higher than the H2. They do know that they can push the cost up and many people will still buy them. The higher end model will fulfill this purpose. It will compete slightly more with the Mercedes - the ones who want the glitz and will pay almost anything for it.

The current market availability of H2's is pretty much fabricated. GM had high goals for selling the truck and I think we're starting to see the desperation to meet the goal. There's pretty good evidence of this. The dealers are alotted a certain number of trucks to put on their lot as well as to custom order. Well, if you haven't noticed, many of those on the lot are sitting there for awhile. They are NOT flying off the lot. The dealers will lie about this to get you to place an order. They will lie about the ones on the lot that are 'sold'. Why? Because unless you indicate that you want to drive one off the lot that day, they'll push you to order one or to take one in next months batch. They know there's enough impatience around that the ones on the lot will either act as advertising or someone will come in and demand an H2 at any price.

Ask your dealers some questions:

Q: Is their going to be a price increase?
Dealer: Yes probably in the next month or 2.
Reason: Get you to buy now.

Q: When does the H2 2004 come out?
Dealer: Late next year.
Reason: Far enough out so that you feel comfortable getting the 2003 now.

Q: When can I get one with a sunroof.
Dealer: Oh, it could take almost twice as long.
Reason: They want you to take one without a sunroof b/c they know the ones with a sunroof will sell easily. Also, if they want to push the non sunroof model they'll use the line "ah, most people don't use the sunroof anyway." That may be true but I think most people are in awe of cars with sunroofs.

Q: I want a basic model but I don't want to place an order. Do you have one?
Dealer: No. You won't find a basic one on the lot. You have to buy one with the options.
Reason: Yes, it's true however, there ARE basic H2's on the lots occassionally. These usually appear when someone has cancelled their order. You have to be vigilant to find these but they are there.

Q: I want Yellow. Can I get it in Yellow (the color that doesn't appear to be on the lot).
Dealer: Why? Don't you like red? There's a red one coming in that I think you'd like.
Reason: Some colors sell better than others so they'll push they'll push any color that they have coming in.

Q: How is the demand?
Dealer: Oh it's huge. All of the H2's are sold.
Reason: Get you to place order.

Q: Why have those been sitting here on the lot for weeks?
Dealer: Oh those are being picked up today.
Reason: Create perception of demand.

Q: (one week later)... why are those H2's still here?
Dealer: Oh, those aren't the same ones. Those are going out today.
Reason:... same same

Q: (one month from the last time you asked about the sun roofs) Why do all of the H2's on the lot have sunroofs when you told me they wouldn't be made until early next year?
Dealer: Oh those were ordered several months ago.
Reason: Coverup.

I could go on and on about dealer talk but you get the idea. If the price goes up, then I don't think I understand economics as I don't believe the demand is that high.

[Peyton77]

I heard all the same answers when I was at the dealer the other day...

The best was when I asked how long it would take if I were to order one exactly the way I wanted it and he told me that it could take even longer bc the factory will make the general production vehicles first, and group the ordered vehicles together at the end...

Makes sense, the ones that are pre-sold you build last..

Peyton

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[MAC]

Escalade may have a slightly higher MSRP but it is discounted by thousands $ cash back and whatever deal you can make, plus zero percent, zero down, in the end, it is much cheaper than Hummer.

Around here Hummer dealer lot has no Hummer, period.

From the business bean counter' view, having lots of new Hummers on the lot not selling is very expensive and dangerous, the natural thing to do is to cut price and bargain downward, unless Hummer has rule against that, but not sure if that is legal. You have to remember the dealers pay interest on all the cars on the lot, their job One is their own survival but Hummer brand image, if they have to, they can make all sorts of quiet deals. Once sales REALLY slows down, the jungle rule of "Supply & Demand" applies, the evidence will show: Discount. You have to move the merchandise as fast as possible, basic rule. So I am not sure having lots of Hummers on the lot but faking strong demand is a logical guess.

Of course, Hummer can and do limit production to create a short 4-8 weeks wait. Current wait for MB new E class is 6 months.

[HeeHaw]

cognitive, really enjoyed your thread and it is very true and insightful of dealers. You brought a lot of good points to light and the members of this forum can benefit from your prospective.

I still think the price will rise........but that is not based on scientific data, just the fact I think they will rise. 2004 will sell for about 60 and then the nicer model about 75. Just a GUESS!

See ya...............

HeeeeeeeeeeeHawwwwwwwwwwwwwwwwwwww /infopop/emoticons/icon_cool.gif

[SOFTTAILJC]

h2's just went up a $1,ooo. next year they estimate 3 more. they created a feeding frenzy. now if you want one ...anti-up......soft

[H2Norcal]

I am glad to see some of you agree on what is going on with this vehicle. All the post-delivery folks hate to hear it I know, but the H2 is a marketing-hype feast right now. The reality is that it is a hot new vehicle and they are playing all the new launch games.

This was fine about 18 months ago when we all were paying MSRP + 10% mark-up to give the dealer some extra spending money for the deal. But the economy does not work that way anymore.

My dealer has $5k markup in mine. I told him that I have no plans on giving his dealership extra money for absolutely nothing. He said we will work it out.

[H2Norcal]

That is not even worth their trouble for a $50K+ vehicle.

If it is a real increase, I think it is a test buoy that can be easily removed when you sit down to do the deal.

Stupid.

[cognitive]

$48,800 base when it came out
$49,190 base current price

That's a $390 increase. I believe there were increases in the package prices as well but I'm too lazy to track down the exact numbers. I don't think the increase exceeds $1000 and I don't know which particular options were increased but just do your homework before going to the dealer. It's such a pain to add numbers in front of a dealer... and if you ask them to do it, they hem and haw as if they've never used a calculator.

So which dealers are actually talking about the price increase from GM?

I only care about this because if the price does go up to 60k, the H2 SUT will most certainly cost $50k as opposed to the $40k originally planned.

[Steve R]

It's like trying to guess the stock market..nobody has a crystal ball. My thoughts parallel Heehaws...but that's mostly based on having seen behind the curtain at Hummer's marketing research & development: Price is heading up.

Keeping it simple and implementing typical marketing strategies...the first "wave" of consumers on a new concept are referred to as "innovators". We are innovators: we are willing to pay a premium, take a risk and economically speaking allocate a greater degree of marginal utility towards the aquisition of this good.

(Like....oh my God....in the midst of bong-resin, barley, rye & hops...it would seem some of my college education stuck with me!!??)

Bottom line, GM could have easily taken advantage of our willingness to blow coin in order to get into these bad-ass toys. A typical marketing ploy would be to release these things at $58K and sell as many up until demand slowed....THEN, GM starts offering their oh-so-typical "incentives & rebates" to cheapen the price and bring the next wave of purchasers to the table.

So what happened? I spoke with some Hummer-boys, and what happened was a gross under-estimation of what is now regarded as a sales phenomena. The H2 is a hit well beyond their expectations. They only asked a reasonable price HOPING these things would find a market. When pricing it never occurred to them "How much will people be willing to pay for a Hummer made practical for daily use"...instead they figured what a reasonable mark-up would be and gave it their best shot to get this thing in garages.

I've said it before: some body changes, some interior upgrades, a bigger engine...and through "innovation & improvments" the new H2's will be soaring just under the Range Rover price. And ya know what...they'll sell 'em all!