GM waives some lease payments to boost sales

DETROIT, May 19, 2003; Reuters reported that General Motors Corp. said today that, in an attempt to boost sales, it will waive up to six months of lease payments on most GM models if the owners buy or lease a new vehicle.

The world's largest automaker will nullify lease payments on contracts that expire between July 1 and Jan. 2, 2004, if the owners buy or lease any new GM vehicle except a Saab, Hummer or medium-duty truck, said GM spokeswoman Elaine Redd.

Last week, John Smith, GM's head of North American vehicle sales, service and marketing, warned that May U.S. vehicle sales so far appear to be a bit weaker than April's levels. That alarmed Wall Street analysts expecting stronger results this month.

GM added other incentives last week, offering six-year loans at a rate of 1.9 percent on most passenger vehicles except Cadillacs, Hummers and Chevrolet Corvette sports cars.

Through the first four months of the year, GM's sales are down about 10 percent from last year's levels. GM executives have admitted that its incentives, which helped drive consecutive annual U.S. market share gains, have not been as effective in recent months.

"Everybody's pulling out the toolbox," GM's Redd said. "Our goal is to do what we can to increase the size of the industry."