May consumer exit out of gas-quaffing trucks and SUVs means big trouble for Big Three

[doh]

http://www.marketwatch.com/news/stor...D&siteid=yhoof

SAN FRANCISCO (MarketWatch) -- The massive consumer exit out of gas-quaffing trucks and SUVs and into crossovers and cars is gathering momentum in the U.S., and with monthly vehicle sales tallies due Tuesday, not even Toyota is immune to the fallout.
Still, it's that troubled trio from Michigan, and their historic reliance on the higher-margin, heavy-metal segment, that have taken the biggest hit.
"The seismic shift in consumer preference for small instead of large vehicles like those offered by Detroit automakers has left the domestic big three automakers in bad shape compared with Toyota and Honda," Edmunds.com editor Michelle Krebs said, adding that market share for the U.S. carmakers is moving toward historic lows.
General Motors Corp. is expected to lead the way with a 19.2% drop in May U.S. sales from a year ago, according to the car-buying research Web site.

The news is likely to be almost as bad for Chrysler, who counts more on the big vehicles than any other automaker. Chrysler's drop is seen coming in at 18.2% while Ford Motor Co.
with its flagship F-Series pickup losing some of its lead as America's best-selling vehicle, is expected to report a 9.3% retreat.
Last month, Ford announced plans to produce a total of 690,000 vehicles in North America in the second quarter, which amounts to an additional reduction of 20,000 units from previous plans and which would represent a 15% decline from the year-earlier period.
More cutbacks on the production front could be on tap from carmakers should the housing slump persist and gas prices continue to keep consumers away from the dealerships.
But on a positive note for the broader industry, Edmunds.com is looking for Honda Motor Co.
to report gains of 7.2% and 3.8%, respectively.

Toyota Motor
projected 3% decline won't stop the automaker from reaching record market share in the U.S.
Overall, Deutsche Bank analyst Rod Lache said he sees the seasonally adjusted annual rate of sales dropping to 15.2 million cars and trucks, down from 16.2 million in 2007 as the industry tracks toward its worst sales year since the early 1990s.
Most troubling for the domestic car makers is Lache's expectation that truck sales dropped as much as 30%, while car sales, an area of strength for the Japanese manufacturers, rose at least 20%.
"We believe the mix shift away from trucks continues to accelerate, underscored by Ford's decision to revise its 2-year outlook," he said. Lache said he expects trucks and SUVs to drop 4 percentage points in market share by 2010 as the industry undergoes a "structural change."

[HoosierRon]

Try finding a Patriot on the lot of a Jeep dealer. I have. You can't. But Chrysler will happily pump out Aspens and Durangos all day long.

Perhaps if the lots were not empty of the small vehicles they do make, they might actually sell them.

[ByTheLake]

Please don't tell me that 2007 was "the good ol' days".

[hunchman]

oh I love these threads where the sky is falling

Why is it that GM is planning overtime at some of its truck plants if it is so bad. Is GM doing this so GMI posters can blame the union for making them do it? hmmmmmmmm

[Ming]

Originally Posted by HoosierRon

Try finding a Patriot on the lot of a Jeep dealer. I have. You can't. But Chrysler will happily pump out Aspens and Durangos all day long.

Perhaps if the lots were not empty of the small vehicles they do make, they might actually sell them.

Reminds me of the total lack of small Canyon trucks at a local GMC dealer.

[63GrandSport001]

If I owned a Chevy dealer Id move all of the big trucks and SUVs to the back and move all of the small cars to the front so that people can see that we have small cars.

[jbernie]

It will be interesting to see how consumers react if gas prices drop over the next few months, other than severely cutting back on full size suv & truck production what else can gm do short term? If the smaller trucks really were top quality then they would have been selling just fine by now. Just look at the sticket in Ming's thread about the Canyon, 14-19mpg. Pretty much the same gas mileage as the full size trucks.

Reality says if the market falls out of the large truck/suv market and there is a seismic shift to cars & wagons, all manfacturers will benefit simply because none of them can satisfy the demands of the market on their own.

Give it another two months or so and you might pick up a Tahoe for not much more than a Corolla.

[ponyok67]

Because the buying public is as easily brainwashed and frightened as it is - the Big 3 should get those small, save the planet vehicles out as fast as it can possibly be done. But this time make them all LOOK COOL. So no one can gripe about the products being DULL. It is so simple.

[motorman]

Originally Posted by ponyok67

Because the buying public is as easily brainwashed and frightened as it is - the Big 3 should get those small, save the planet vehicles out as fast as it can possibly be done. But this time make them all LOOK COOL. So no one can gripe about the products being DULL. It is so simple.

what do you think will happen to the sales of these cars when the price of gas come back down to $3 a gallon,they we clog up the dealers lots. this happens every time so GM is trying to go slow on the changeover

[Mr. Burns]

What about chryslers $2.99/gallon gas for 3 years promotion?

[PhishPhood]

Originally Posted by motorman

what do you think will happen to the sales of these cars when the price of gas come back down to $3 a gallon,they we clog up the dealers lots. this happens every time so GM is trying to go slow on the changeover

If you seriously think fuel is going to go back to $3 a gallon they you need to jump right on Chrysler's 'Hire me in marketing list'. You may never see fuel as low as $3 again. Ford is planning on fuel staying in the $3.75 - $4.25 range through all of this year and all of next year......then it really goes higher.

It's that kind of unrealistic hope-against-hope that got Chrysler into the mess it's in....GM and Ford to a lesser extent. Why would you want to contribute to outdated hopes? Why not just deal with the situation in front of you. China and India are just going to suck up all the excess oil in the world for the foreseeable future. No matter what we do the prices are going to European levels.

Only when massive alt-fuel production starts will we begin to see some relief. Why hide from this data? Why not just deal with it?

[gardnet1]

Originally Posted by motorman

what do you think will happen to the sales of these cars when the price of gas come back down to $3 a gallon,they we clog up the dealers lots. this happens every time so GM is trying to go slow on the changeover

It's like a see-saw or a sine wave with one major difference. Every time we have a gyration, more and more people play it safe and go with the sedan or crossover that is easier on gas than the SUV or Truck. Say for every 7 who switched, you might get 5 coming back to SUVs. It's mostly the low-hanging fruit that aren't coming back such as the boulevard cruisers. Those who need a work truck or an SUV to haul a boat or a large family aren't going anywhere, but the ones who own a truck or SUV just for the heck of it probably aren't coming back anytime soon.

BTW, GM is having a hard time selling the Yukon/Tahoe Hybrids, I think they need more commercials such as a side by side comparision with a 4 banger camry, saying that they both get the same mileage but which would you rather have (showing the Yukon Hybrid with a ski boat hooked up too it).

[Lunden]

BTW, GM is having a hard time selling the Yukon/Tahoe Hybrids

WHAT?!?!?!?!? They are only 50k What's the deal?

[rumble bee]

Whoa! I know Dodge is hurting. The sales of the Ram and Durango are plumeting. I think that the Caliber, Avenger, and Journey will help them out even with the trucks wilting. I do think that Dodge is moving in the right direction as the highway mileage of the new Ram 1500 is class leading.

BTW, I focus on Dodge only because they are the make of my Rumble Bee. I am not saying that they are any worse then the other two but that explains my interest in their status.

[Stéphane Dumas]

Originally Posted by gardnet1

BTW, GM is having a hard time selling the Yukon/Tahoe Hybrids, I think they need more commercials such as a side by side comparision with a 4 banger camry, saying that they both get the same mileage but which would you rather have (showing the Yukon Hybrid with a ski boat hooked up too it).

+1, and also add a side by side comparaison with the Malibu