Automotive News
August 22, 2016
Photo: 2017 Chevrolet Camaro. Image Credit: General Motors Corporation
Article Quotes:
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August 22, 2016
Photo: 2017 Chevrolet Camaro. Image Credit: General Motors Corporation
Article Quotes:
After hitting a five-year peak in 2015, combined sales of the Ford Mustang, Chevrolet Camaro and Dodge Challenger have declined 8.4 percent this year.
So is it time to worry about America's fabled muscle-car troika?
Possibly not, because the decline this year nearly matches the 8.5 percent drop in overall car sales as crossovers and SUVs keep rolling up gains. Yet the cool-down of America's muscle-car mania could have deeper meaning.
Customers who buy Mustangs, Camaros and Challengers do so because they want modern evocations of 1960s performance icons, not because they need them, says Karl Brauer, senior director of insights for Kelley Blue Book. And that could be a problem.
"You have the canaries in the coal mine -- cars that are more discretionary rather than functional purchases, and cars that you see starting to decline first" when the market starts to plateau or dip, he says. "We're seeing that in two areas -- luxury brands are struggling more, and so are these performance cars."
In 2015, muscle-car sales shot up 22.6 percent for the first seven months. In 2014 and 2015, the three cars handily outperformed the overall car market.
But sales of all three cars have dropped this year: Mustang down 5.5 percent to 72,530; Camaro down 15.4 percent to 42,354 and Challenger down 5.5 percent to 39,998.
2017 Chevrolet Camaro
Chevrolet spokesman Jim Cain attributes the Camaro's steeper drop to the fact that last year, Chevrolet was headed into a model change-over. "A year ago we were running out the old model," he said. "We had higher inventories and higher fleet sales."
Cain points to higher Camaro transaction prices -- up $3,584 over last year according to Kelley Blue Book -- as evidence the "car is doing really well."
And the story of a slow decline may not be so simple. Tom Libby, analyst for IHS Markit, says the muscle-car segment still shows signs of strength.
Loyalty within the segment has increased over the past five years. Of those customers who owned a Mustang, Camaro or Challenger and returned to trade it in for a new car this year, 23.8 percent stayed within the segment, up from 17.1 percent in 2012, according to IHS data.
"There's a market out there that's attracted to the whole muscle-car concept and that market is stable," says Libby. "There's a segment of the buying population that likes the attributes of those cars. They like the image, the styling, the sound, the transmissions."
"Whatever their sales are right now, it's not being driven by lack of product capability or effort. If we're seeing a plateau or decline, it's because this is what the market can bear in terms of product quality."
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