Post by TonyV on Dec 30, 2009 12:17:19 GMT -5
Detroit 3 kings of road when it comes to pickups
U.S. automakers have 91% of market
BY BRENT SNAVELY
FREE PRESS BUSINESS WRITER
Even as Detroit automakers move their focus away from pickups to small, fuel-efficient cars, full-size trucks still make up more than 20% of sales by Detroit automakers and could play a key role in helping the companies recover in 2010.
Foreign automakers, despite efforts with models such as the Toyota Tundra and the Nissan Titan, have not been successful in stealing profitable pickup market share from the Detroit Three.
Through November, Detroit automakers sold 91% of all full-size pickups.
"There is still that one stronghold left over," said Jesse Toprak, auto analyst for TrueCar.com. "It is important -- at least in the interim -- that the domestics experience strong truck sales because it generates cash."
That is expected to happen, too. As the economy rebounds and the housing industry recovers, sales of full-size pickups, a mainstay for contractors, usually make gains.
Although it's unlikely that trucks will rebound to the heyday of sales in 2005, even a small boost would significantly lift the fortunes of Detroit's automakers.
Pent-up demand builds among housing contractors
Home builder Joe Garner said he bought a new Ford F-150 a few weeks ago because the housing market in Columbus, Ohio, started to rebound in October.
"It was slow in the summer, but it's actually picked up for me," Garner said. "We're pretty busy right now."
Garner's confidence is good news for the Detroit Three.
The full-size pickup segment has been hit harder than the overall automotive industry because of soaring gas prices and a national recession that has decimated the housing industry.
Through the first 11 months of this year, full-size pickup sales have declined 31.2% while the overall industry has declined 23.9%, according to Autodata Corp.
But dealers and manufacturers are hoping for a rebound next year.
"The biggest thing for us is the pent-up demand that is building up on the commercial side of trucks," said Gordon Stewart, owner of Gordon Chevrolet in Garden City. "At some point, it is going to explode."
In November, home construction rebounded with housing starts increasing by 8.9% compared with October, the Commerce Department said Dec. 16. However, November starts still declined 12.4% compared with the same month a year ago.
"As a segment, full-size pickups are very dependent on the level of construction and new housing starts," said Ford Motor Co. sales analyst George Pipas.
Pipas said he expects full-size pickup sales will increase next year, but doubts that increase will start until the second half of the year.
"Even after housing recovers, it could take awhile," Pipas said.
Toprak expects a rebound will begin before June and expects pickup sales for the year will increase by about 15%.
Pickups often sell for more than $30,000 and generate more profits than small and midsize cars. They also still account for about one-fifth of the Detroit Three's total sales.
And even though domestic automakers are introducing several key small cars next year -- such as the Ford Fiesta subcompact and the Chevrolet Cruze compact -- each automaker continues to aggressively pursue the full-size pickup market.
And even though domestic automakers are introducing several key small cars next year -- such as the Ford Fiesta subcompact and the Chevrolet Cruze compact -- each automaker continues to aggressively pursue the full-size pickup market.
At Ford, the F-Series line of pickups "will be Ford's best-selling vehicle for years and years and years to come," Pipas said.
In fact, Ford's F-Series has been the best-selling vehicle in America every year since 1982 and the best-selling truck in the United States since 1977.
This year, Pipas said, the F-Series remains on track to retain that No. 1 title. Through November, Ford's F-Series has outsold the Chevrolet Silverado by 82,173, according to Autodata Corp.
However, when sales of the Chevrolet Silverado are combined with the GMC Sierra, General Motors Co.'s total full-size pickups have outsold the F-Series by 17,525.
Chrysler Group LLC, meanwhile, spun off Ram as a separate brand in October and is counting on Ram for sales growth. Through November, the market share of full-size Dodge Ram pickups increased to 16.5% from 15.8% from the same period last year.
"The all-new 2010 Ram Heavy Duty just won Motor Trend's Truck of the Year," Chrysler spokeswoman Kathy Graham said in an e-mail to the Free Press. "With this momentum, we expect Ram light-duty truck sales will increase roughly 15% to 20% in 2010."
But no matter how much pickup sales rebound in 2010, analysts doubt that sales will return to the heights experienced just a few years ago.
In 2005, full-size pickups accounted for 15.2% of all industry sales in the United States, according to Edmunds.com. But that percentage dropped to 12.3% last year, and that has declined even further to 10.8% for the first 11 months of this year.
Meanwhile, average incentives for full-size pickups have increased from $2,128 in 2002 to $4,778 this year, according to Edmunds.com.
The reason: Volatile fuel prices have driven buyers out of the market who were buying pickups simply because they like them.
"I think what we are seeing now is the true demand of pickup truck sales," said Jessica Caldwell, a sales analyst for Edmunds.com.
Contact BRENT SNAVELY: 313-222-6512 or bsnavely@freepress.com
U.S. automakers have 91% of market
BY BRENT SNAVELY
FREE PRESS BUSINESS WRITER
Even as Detroit automakers move their focus away from pickups to small, fuel-efficient cars, full-size trucks still make up more than 20% of sales by Detroit automakers and could play a key role in helping the companies recover in 2010.
Foreign automakers, despite efforts with models such as the Toyota Tundra and the Nissan Titan, have not been successful in stealing profitable pickup market share from the Detroit Three.
Through November, Detroit automakers sold 91% of all full-size pickups.
"There is still that one stronghold left over," said Jesse Toprak, auto analyst for TrueCar.com. "It is important -- at least in the interim -- that the domestics experience strong truck sales because it generates cash."
That is expected to happen, too. As the economy rebounds and the housing industry recovers, sales of full-size pickups, a mainstay for contractors, usually make gains.
Although it's unlikely that trucks will rebound to the heyday of sales in 2005, even a small boost would significantly lift the fortunes of Detroit's automakers.
Pent-up demand builds among housing contractors
Home builder Joe Garner said he bought a new Ford F-150 a few weeks ago because the housing market in Columbus, Ohio, started to rebound in October.
"It was slow in the summer, but it's actually picked up for me," Garner said. "We're pretty busy right now."
Garner's confidence is good news for the Detroit Three.
The full-size pickup segment has been hit harder than the overall automotive industry because of soaring gas prices and a national recession that has decimated the housing industry.
Through the first 11 months of this year, full-size pickup sales have declined 31.2% while the overall industry has declined 23.9%, according to Autodata Corp.
But dealers and manufacturers are hoping for a rebound next year.
"The biggest thing for us is the pent-up demand that is building up on the commercial side of trucks," said Gordon Stewart, owner of Gordon Chevrolet in Garden City. "At some point, it is going to explode."
In November, home construction rebounded with housing starts increasing by 8.9% compared with October, the Commerce Department said Dec. 16. However, November starts still declined 12.4% compared with the same month a year ago.
"As a segment, full-size pickups are very dependent on the level of construction and new housing starts," said Ford Motor Co. sales analyst George Pipas.
Pipas said he expects full-size pickup sales will increase next year, but doubts that increase will start until the second half of the year.
"Even after housing recovers, it could take awhile," Pipas said.
Toprak expects a rebound will begin before June and expects pickup sales for the year will increase by about 15%.
Pickups often sell for more than $30,000 and generate more profits than small and midsize cars. They also still account for about one-fifth of the Detroit Three's total sales.
And even though domestic automakers are introducing several key small cars next year -- such as the Ford Fiesta subcompact and the Chevrolet Cruze compact -- each automaker continues to aggressively pursue the full-size pickup market.
And even though domestic automakers are introducing several key small cars next year -- such as the Ford Fiesta subcompact and the Chevrolet Cruze compact -- each automaker continues to aggressively pursue the full-size pickup market.
At Ford, the F-Series line of pickups "will be Ford's best-selling vehicle for years and years and years to come," Pipas said.
In fact, Ford's F-Series has been the best-selling vehicle in America every year since 1982 and the best-selling truck in the United States since 1977.
This year, Pipas said, the F-Series remains on track to retain that No. 1 title. Through November, Ford's F-Series has outsold the Chevrolet Silverado by 82,173, according to Autodata Corp.
However, when sales of the Chevrolet Silverado are combined with the GMC Sierra, General Motors Co.'s total full-size pickups have outsold the F-Series by 17,525.
Chrysler Group LLC, meanwhile, spun off Ram as a separate brand in October and is counting on Ram for sales growth. Through November, the market share of full-size Dodge Ram pickups increased to 16.5% from 15.8% from the same period last year.
"The all-new 2010 Ram Heavy Duty just won Motor Trend's Truck of the Year," Chrysler spokeswoman Kathy Graham said in an e-mail to the Free Press. "With this momentum, we expect Ram light-duty truck sales will increase roughly 15% to 20% in 2010."
But no matter how much pickup sales rebound in 2010, analysts doubt that sales will return to the heights experienced just a few years ago.
In 2005, full-size pickups accounted for 15.2% of all industry sales in the United States, according to Edmunds.com. But that percentage dropped to 12.3% last year, and that has declined even further to 10.8% for the first 11 months of this year.
Meanwhile, average incentives for full-size pickups have increased from $2,128 in 2002 to $4,778 this year, according to Edmunds.com.
The reason: Volatile fuel prices have driven buyers out of the market who were buying pickups simply because they like them.
"I think what we are seeing now is the true demand of pickup truck sales," said Jessica Caldwell, a sales analyst for Edmunds.com.
Contact BRENT SNAVELY: 313-222-6512 or bsnavely@freepress.com