The Chrysler unit of DaimlerChrysler said on Oct. 16 it was offering a $3,000 cash rebate on its Pacifica wagon, highlighting disappointing initial sales of the vehicle, according to a Reuters report.

As an alternative to the cash back deal, which also took effect on Oct. 16, Chrysler spokesman David Elshoff said customers would be offered interest-free financing toward purchases of a Pacifica for up to five years, according to Reuters.

The 2004 Pacifica, a broad-shouldered cross between a minivan and SUV, was billed as an exciting new product that was sure to bolster Chrysler's bottom line when it went on sale in March, Reuters noted.

But its high price tag, which tops out in excess of $40,000, is a turnoff for many traditional Chrysler buyers, according to Reuters.

Buzz about the Pacifica, which Chrysler has touted as a "segment buster," may also have been hurt by car reviews spotlighting what some critics describe as the chunky vehicle's sluggish engine, Reuters said.

In another escalation of Detroit's long-running price war, which has eroded profits across the U.S. auto industry, Elshoff said Chrysler had also begun offering cash rebates totaling up to $5,000 on many of its 2003 model minivans.

Rebates on 2004 model minivans, including the high-end Town and Country, now total up to $4,000 across much of the United States, Elshoff said.

Chrysler, which posted a surprising $1.1 billion second-quarter loss, faces fierce competition in the minivan segment due to new product offerings from Japan's top three automakers, Reuters said.