GM To Launch Sales Incentive, Push 'Cash For Clunkers' Deal

General Motors Corp. (GMGMQ), looking to bolster sales as it prepares for a new start out of bankruptcy protection, will free financing on many vehicles for six days starting Wednesday.

The auto maker also plans to begin urging customers to capitalize on the recently passed "Cash for Clunkers" legislation that gives car buyers up to $4,500 to trade in aged gas-guzzlers for new cars and trucks. The company's campaign will be called "Buy and Say Goodbye." Money for the clunkers program won't likely be available until late July, but GM wants to get customers thinking about a trade now, company spokesman John McDonald said.

GM's free-financing offer, a deal it has resuscitated several times amid a severe slump in U.S. auto sales, will apply to many 2009 and 2010 model year vehicles, including large pickup trucks and sport utility vehicles and the entire Pontiac line. GM is winding down Pontiac as parts of its Chapter 11 restructuring.

GM's sales are down 42% through May, sharper than the industry's 37% decline. Major auto makers will release Wednesday June sales results, which are expected to show some signs that the auto market has begun to stabilize.

Car makers have struggled to woo jittery, cash-strapped consumers despite offering generous deals.

GM's sale, though it runs six days, will be dubbed as a 72-hour holiday sale since dealers will, on average, be open only 72 of those hours because of the Holiday weekend, McDonald said. McDonald didn't disclose GM's incentive plans for later in July, but said "you can certainly anticipate we'll be offering reduced rate financing" at that time. It is unclear whether that will include 0% financing for 72-month loans on certain vehicles.

Ford Motor Co. (F) also has begun to tout the clunkers program with a slogan, "Let Ford recycle your ride." Under the program, a vehicle qualifies for trade-in if it is a 1984 model or newer and gets no more than 18 miles per gallon. The replacement vehicle must have improved fuel economy.

-By Sharon Terlep and John D. Stoll, Dow Jones Newswires; 248-204-5532; [e-mail].