Auto admin  

truck sales down

Truck sales have been high because they are reliable when it comes to engine power and performance. In fact, Detroit automakers are looking at these types as sales and profit drivers compared to SUVs.

In today’s modern age, pickup trucks have become more sophisticated vehicles. They now have expensive features found in cars including leather seats, booming stereos, and large passenger compartments. Furthermore, pickup trucks have also adopted the same image as SUVs and are now parked in industrialized areas; Gone are the days of “parking only at the construction site.”

Unfortunately, in terms of popularity and sales, SUVs have overtaken trucks. And even for companies with the newer models, truck sales are down while rebates and other incentives are up.

Two months ago, Bucky Hacker traded in his 2002 Dodge Ram Quad Cab pickup for a subcompact car: the Mazda 3 with a top-of-the-line Mazda throttle position sensor. A student from Oak Ridge, Tennessee, Mr. Hacker bought his Dodge vehicle to tow a boat and also to attract girls with his very masculine looks.

But he was ridiculed. His Dodge’s gas mileage reached 13 miles per gallon just from towing the boat, while his new Mazda averages double that or 26 miles per gallon city and highway.

According to him, the reasons behind the decline in truck sales are customers’ growing sense of environmental concern, high gas prices and the uncertain real estate market causing many contractors to delay buying new trucks. All of this caused sales to fall 5 percent so far from last year’s weak market. That percentage is more than 50 percent of the overall decline in industry sales, which is down 2 percent this year so far.

As a result, automakers began to expect truck sales to drop from the late 1990s through this year.

According to Power Information Network, the average discount on a Dodge Ram is $6,000, an increase of $500 from January. On each Silverado truck, Chevrolet pays an average of $2,343 in incentives. When the truck was new at the beginning of the year, the brand doubled its discounts.

The same data showed that even Toyota discounted its Tundra during its February reveal by an average of $2,000.

Data from CNW Marketing Research, which tracks industry trends, showed that 6 years ago, 28 percent of consumers across the US who bought trucks did so for the looks of the vehicles. But this year, only 16 percent of customers bought full-size trucks for looks as their primary reason.

Art Spinella, president of CNW, said that buyers who have defective products will not return. They prefer to find other vehicles with style. He added that contractors, farmers or ranchers who need trucks for their businesses will continue to buy them, but not as often as in previous decades.

Ford, which relies heavily on trucks, has 24 percent of truck sales and 41 percent of the company’s gross profit in North America over the past five years. This was according to Mr. Johnson’s calculations in an investigative report.

Like Ford, GM also relies heavily on trucks. GM’s 32 percent of gross profit is made up of 20 percent of truck and other sales; while Chrysler trucks contributed 25 percent of its profits and 18 percent were truck vehicle sales over the past five years.

Ford’s loss of $12.6 billion was attributed to a drop in truck sales in 2006. However, that figure is also attributed to the company’s restructuring plan.

Yet despite the economic fears, some dealers say their truck business has stayed the same.

Meanwhile, automakers that have been hit hard by this trend in trucks are optimistic that they will soon find a way to recoup their losses.

To make trucks marketable again like they were decades ago, auto companies need to address vehicle fuel economy and do a few more innovations. After all, everyone is now affected by ever-increasing gas prices when considering vehicle design and styling.

Leave A Comment