There are a couple of schools of thought on this.
The domestic manufacturers have capacity in excess of demand, so they have determined to lower price through incentives to keep them occupied.
Even with the lower net pricing, the transaction price is creeping up in the broad sense. There is movement (by buyers) from one segment to another. And the brands have added new models, and those new models are priced in the upper range of the brand.
Right now the domestic brands do not have the reputation that would allow them to go without incentives. Chrysler tried it three years ago. Then two weeks later they got right back on the incentives because without them they couldn't market anything. The brand strength of Honda, the history of reliable, durable products, is great enough to pull in prospects without customer cash.
They don't seem to be able to make money there.
The deal will fade, but the vehicle will be with you for years. Get something that you'll enjoy, that holds its value, because you'll have to live with it down the road.
Go over $3 and close to $4 and stay at that level for at least a year.
Toyota tends to have more products in each segment. Honda goes much slower -- for example, it's not in pickups at all. But they watch and when they execute a product, they do it almost flawlessly so they immediately have a leader in the segment.
We believe at $3 a gallon there's not enough bite in a person's pocketbook to make a big difference.
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