[lbo-talk] Hummers (LBO 104)

Timothy Francis-Wright twright at ziplink.net
Mon May 12 19:14:44 PDT 2003


The back page of LBO #104 mentions that the Hummer land yacht has been selling like hotcakes, even without the 0% financing that almost every other General Motors car or light truck.

But the Hummer comes with incentives for buyers that go beyond the merely symbolic, if the buyers have corporate status. Because it has a gross vehicle weight rating of over 8500 pounds, it is not subject to the special rules that limit depreciation of vehicles.

A small business can write off $15,000 on a $50,000 Hummer right away, then depreciate the remainder over a 5-year period (an additional $7,000 the first year, and $11,200 the next year). A lighter $50,000 cars or truck would get the $15,000 write-off, but much less regular depreciation thereafter.

The appeal to "small businesses" (read "lawyers and doctors") is, I submit, the only reason that the Hummer--or the Lincoln Navigator or the Chevy Suburban--weighs as much as it does.

--tim francis-wright



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