Buy One, Get One Free

23 October 2004

Detroit Free Press. Driven by the glut of inventory (on which they have to pay interest), some auto dealers are trying a new come-on: Buy a truck, get a car for free. Astoundingly, the numbers work.

It didn’t take long before a few crafty auto dealers started putting two and two together, and figured out the combined deals made a lower-priced car practically free. So PRESTO: The latest buy-one-get-one-free deal was born.

“It’s a doable thing—it’s not just a ploy,” said Adams [Ray Adams of Adams Ford], who recalled running a similar program at his Toyota store many years ago. “Plus it lowers our inventory twice. ... It was really a good deal.”

To some industry observers, this tactic might be a sign of desperation.

Buy-one-get-one-free deals—known in the retail industry as BOGO offers—usually involve cheaper products, such as shoes, videos or day-old bread. Neither GM nor Ford had a comment about the concept of giving away cars with trucks or whether they were worried such deals might devalue their brands.

“Our dealers are independent businessmen, and we cannot influence how they do their business,” said Ford spokesman David Reuter.

The catch: the buyer pays full price for the truck, finances through the automaker, and signs over all rebates and bonus cash to the dealer.

Good grief.