Sunday, January 30, 2005

Safety Sells?

General Motors has the idea that increased safety will sell more cars. Within all of their new cars GM has decided to install OnStar which is a satellite positioning device. This along with a newer technology they call the electronic stability control is what they believe will make their product more desirable to the public. The kicker is that they will provide this new technology in the first year for free, so long as the buyer purchases a new car.

Would GM's plan to appeal to potential buyers work and will the opportunity cost outweigh the benefits of such a risky move?

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