General Motors increased discounts on large pickups after its prominent units dropped in sales in June. Following the report, the US judge dismissed the compensation claims of the customers on the safety recalls in 2014.
Last month, the U.S. sales of Silverado and Sierra dropped by 3.7 percent and 7.8 percent respectively as the sales of Ford’s F-Series moved higher. GM made series of advertisements to to gain the interest of the car buyers and the full-size pickup enthusiast.
Michelle Krebs, a senior analyst with researcher Auto Trader, explained that GM had a big promotion in June and it didn’t really move the needle so they sweetened it. “It appears from the sales numbers in June that the truck-bed ad wars did not resonate with consumers in a way that sent them to Chevy and GMC trucks,” Mr. Krebs added.
The automotive accompany offered 20 percent off sticker prices, which accumulated significant increase of sales of its big pickups in the first two weeks of July.
GM spokesman Jim Cain reported that they had an eight-day sale that absolutely obliterated Ford and their other competition, especially in full-size pickups. Adding to the upbeat report, fully half of the full-size pickups sold to retail customers during the first 10 days of July were a Chevrolet Silverado or a GMC Sierra.
Despite the positive turn of report, GM might announce the same discounts offered by its major competitors before August. Mr. Cain lauded the contribution of the Chevy truck-bed ads in the success of the sales of GM trucks.
Separately, US District Judge Jesse Furman dismissed the compensation claims against GM and the accusation that the sold vehicles were defective.
Judge Furmann wrote in his report that plaintiffs’ pursuit of damages based purely on perceived harm to GM’s brand following more than 70 recalls in 2014 was “unprecedented and unsound.
“The court finds that that novel theory of damages is unsound in light of persuasive precedent interpreting consumer-protection law,” Mr. Furmann added.
One of the complainants accused the car maker of delaying the recall of defective units which triggered the death of 124 individuals. GM has paid $2 billion to address the claims on its defective steering, brakes and air bags.
Steve Berman, the lawyer of the plaintiffs remained firm on his stand in the case. Attorney Berman said that the GM recalls were unprecedented, and the law should be able to react to this. The plaintiffs’s lawyers may appeal to the court to seek the compensation for the damages done by the faulty units of the U.S. auto maker.
However, after the result was released, Mr. Cain sounded optimistic in the recovery of the company from the issue. “The court made it clear the plaintiffs overreached in many aspects of their complaint and the ruling significantly curtails the scope of their potential recovery,” Mr. Cain said.
Recently, General Motors Company went up 0.03 percent to $30.77 with a price earnings ratio of 4.61 percent. The Michigan based multinational firm had a market capitalization of $47.40 billion and a dividend yield of 4.94 percent.
General Motors is the team behind the Buick, Cadillac, Chevrolet, GMC, Holden, Opel and Vauxhall brands. It mainly designs, builds and sells cars, trucks, crossovers and automobile parts. Also, it offers cars and trucks to fleet clients and provides daily rental cars.
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