GM hopes for a strong start to 2005

It is to use clearly-defined cut-prices on many 2004 and new 2005 models, in a scheme called the GM Red Tag Sale.

The programme will use the slogan See Some Red, Save Some Green as dealers in 75 top sales markets will be encouraged to mark low prices on to red tags.

The move comes after two months of disappointing sales in the US for GM.

Last week GM reported a 13% fall in its American sales for November, and said it expected first quarter production to be about 7% down on the same period last year.

'Price you pay'

The new programme, which ends on 3 January, will be backed by heavy advertising using television, radio and internet.

A television commercial to promote the deals says "the price on the tag is the price you pay".

This will help clear up some confusion for consumers, as in many US car dealerships the only price clearly on display is the manufacturers' suggested retail price.

This is required by law, and is seldom the actual price paid by buyers.

'Finish with a bang'

"We've picked up our incentives nationally and regionally to put us in an outstanding price position," Pete Gerosa, GM North America vice president of sales, service and parts, told dealers on a webcast.

"We've only got a few weeks left in the year, and with this promotion we can finish with a bang and move off inventory, in anticipation of a strong start in 2005."

The firm introduced 29 new and redesigned models this year and plans 24 next year.

Current GM incentives vary slightly among US regions, but offers include up to $3,500 cash back on some new 2005 models, and interest-free financing for up to six years or up to $7,000 cash back on some remaining 2004 models.

Previous GM incentives have included interest-free financing offers, and extended low-rate finance deals.