Pickup vs. Prius
Everyone has been arguing over what the real cause of Detroit’s trouble is. Some say it’s their product line-up, which was known for it’s poor quality, poor fuel efficiency and lack-luster designs. Others say it’s the credit crunch, the implosion of the housing market, and rising gas prices. While reading an article in this month’s Motor Trend magazine though, I realized that Angus Mackenzie is 100% correct when he states that, basically, the fickle nature of customer’s buying habits is really to blame for Detroit’s problems.
Mackenzie states some very interesting facts in his article, titled, “Prius or pickups? – What’s the best way forward for Detroit?” In summary, he lays out how unpredictable American consumers are. Toyota has halted production of a $1.3 billion factory near Tupelo, Mississippi, that was intended to build the new Prius hybrid (originally slated to build the Highlander SUV.) Why on earth would Toyota do that, you might be asking, when hybrids are the “in” thing right now? The reason is very simple actually. November 2008 Prius sales were about half of what they were in November 2007. Sales of the Prius were 8660 to more than 21,000 for the two months respectively.
So what you might say? The car market as a whole was down, people were having a harder time getting credit. To that I say, you’re absolutely right, until you look at another set of data. For that same time period, Ford F-150 sales were down only 18.5%, while the Chevrolet Silverado sales were down 22%. 37,911 F-150s and 29,534 Silverados rolled off dealer lots even with the credit crunch and bankruptcy rumors floating around. This is where the problem lies, says Mackenzie, “If no one can figure out what vehicles American consumers will buy from one month to the next (and that includes Toyota, allegedly the smartest guys in the room), how on earth is Capitol Hill going to be able to determine in which direction Detroit’s salvation lies? Should Motown be building Prius clones? Or pickups?”
This is where I couldn’t agree more. Truck and SUV sales were down sharply this summer, when gas was streaking towards $4 a gallon. Automakers (the D3 and their foreign rivals) were all scrambling to stop production of large, gas guzzling vehicles and produce more smaller, fuel efficient vehicles. Yet when the stock market fell out, gas prices tumbled down under $2 a gallon again and what do you know? Truck and SUV sales picked up, granted not to levels like the late 90′s, but still they were higher than in the summer. People had already “forgotten” the pain at the pump they had been experiencing just months before. The Detroit 3 are constantly blamed for building only large trucks and SUVs, but how can they be blamed? They wouldn’t be building them if we weren’t buying them! People were not interested in small, fuel efficient cars back in the 90′s, so Detroit didn’t build as many of them as they did larger, less efficient cars/trucks/SUVs.
This is why we need to push the politicians in this country to increase the taxes on gas. Consumers will continue to buy the most vehicle that they can afford, as long as gas stays cheap. Europeans buy diesels, not because they get better milage, but because diesel is cheaper to purchase, due to the high taxes placed on gasoline. The same is true here. Sure, Toyota sold large numbers of the Prius before gas shot up, but sales were many times greater when people were feeling the pinch every time they filled up their tank. Similarly, truck and SUV sales dropped off when people were spending $150 or more to fill their tank, but once prices fell back down, and a fill-up only cost $50 again, people moved back towards larger vehicles.
Until the leaders in DC realize what is going on, they are going to continue putting the pressure on the automakers to produce cars that get better fuel mileage, when in reality, it’s doing more harm than good. If gas prices were raised with a gas tax, then larger numbers of people would move towards smaller, more fuel efficient vehicles, forcing automakers to shift with the demand. Instead, the government is using CAFE to force automakers to increase mileage by unrealistic amounts within unrealistic deadlines.
The North American International Auto Show is finishing it’s first week…so this post is a tad on the late side. Whatever. Anyway the NA Truck of the Year was announced and the winner was the Ford F-150. In second place was the new Dodge Ram pickup, following in third was the Mercedes ML320 BlueTEC. Seeing as the F-150 has the highest available towing capacity, payload capacity, and unsurpassed fuel economy, it’s not really a big shock that the F-150 beat the second place contender by more than double.
The F-150 also beat out new entries such as the Honda Pilot, Infiniti FX35/50, Nissan Murano, and Subaru Forester (Motor Trend’s 2009 Sport Utility of the Year.) Considering the F-150 has been the best selling truck for over 30 consecutive years, and was once again the best selling vehicle in 2008, marking the 23rd straight year that the F-150 has held that title (no, not the Toyota Camry or the Honda Accord.)
Check out AmericanTrucks.com and their large selection of F150 Accessories.
I have heard that in parts of the country, people do not seem to know that Ford, for example, builds anything other than the F-150 and Mustang. This, sadly, has happened for good reason. During the truck and SUV boom of the 90′s, the American manufacturers let their car programs fall by the wayside, instead focusing a large portion of their development budget on the newest, latest, greatest, and biggest 4×4′s. Cars were an after-thought, as they did not bring in the same large profits of their truck and SUV bretheren. The Japanese manufacturers produced quality cars, but even they wanted a piece of the truck and SUV profit pie, and eventually built plants in America to build their own versions of the gas-guzzlers.
Even though this was the case as little as 5 years ago, the American 3 have made a very strong comeback in the car arena. As you could see in my earlier post about their fuel efficency, they build small and mid-size cars that are very competitive when compared to their foreign rivals. I also pointed out that their designs are built to high quality standards, putting them in the same league as the foreign brands. To prove that their cars have other very strong selling points are a couple awards that I would like to point out.
Last year the Saturn Aura mid-size sedan was named the 2007 North American Car of the Year at the North American International Auto Show in Detroit, MI.
Then in 2008 the Chevrolet Malibu took home the honors winning 2008 North American Car of the Year. Both of these cars were up against some steep competition (both domestic and foreign) and were picked by a large jury made up of various members of the automotive media.
The 2008 Cadillac CTS won Motor Trend magazines coveted 2008 Car of the Year award.
For 2008, 3 GM vehicles made it on Car and Driver’s 10 Best List; the Chevrolet Malibu, Chevrolet Corvette and Cadillac CTS, more than any other manufacturer.
In 2007, Ford won more JD Power awards than any other automaker. Ford, Lincoln and Mercury all had segment winners. Those three nameplates also finished in the Top 10.
The 2008 Ford Focus was named one of Kelly Blue Book’s Top 10 coolest cars under $18,000. With its combination of SYNC in car entertainment technology and 35 mpg on the highway, it was a tough car to beat.
The Ford Mustang ranked as the most problem-free “Midsize sporty car” from JD Power’s survey, while the Mercuy Milan was the highest ranked mid-sized car, and its sibling, the Lincoln MKZ, was the top-ranked “Entry premium car.”
All of these awards are only a small part of the story behind the cars that make up the American 3′s portfolios these days. Their trucks and SUV’s are superbly engineered, besting those offered up by their foreign competition. That same engineering mentality that goes into their trucks and SUV’s, is now applied to their car programs as well. “Good enough is not good enough” any longer. From the Chevrolet Malibu, to the Ford Fusion, the quality shows. They do not build just trucks and SUV’s, they build some damn fine automobiles as well!
