Sales in the Large Pickup segment grew by 2.5 percent in 2016, a slightly faster rate than the market overall, but considerably slower than the Small Pickup segment. That is to be expected – with total sales of 2,242,282 the segment is the third largest, following the Compact SUV and Mid-sized segments, and as such it would be unreasonable to expect double-digit rates of growth. Still, with slowly rising fuel prices pushing customers towards smaller pickups and nothing in the way of new metal arriving anytime soon (other than the continued rollout of new versions of the new-for-2016 Nissan Titan), it’s entirely possible the segment may not gain many sales at all in 2017, or even losing sales for the first time since 2010.
Sales of full-sized pickup trucks were down by 2% in Q3 of 2016, after an increase of 5% in the first half of the year. For the first nine months, the segment is up 3% to 1,640,674 sales. With relatively high brand loyalty in this segment, there are no big shifts in the performances of individual models, with only two out of the six models making double digit moves in Q3 and only one in the first three quarters of the year. With both the large SUV segment and the small pickup segment surging in Q3, the contrasting loss of the full-sized pickups may have another reason than gas prices. It could also indicate a lower confidence in the US economy and especially the housing market by construction companies, since sales of work trucks are historically linked to real estate prices in the United States.
Sales of Large Pickups in the US rose by 6% in Q2 2016 to 561,915 vehicles, after showing a 5% increase in Q1. This is one of the most important segments for the Detroit-3, with these kinds of volumes and the huge profit margins they earn on this type of vehicle. It’s a cut-throat market and the vehicles are marketed with their toughness, towing and hauling capacities and masculinity. However, with fuel economy becoming ever more important in this segment as well, Ford switched to an all-aluminum body for its thirteenth generation F-150, launched last year. And in Q2, its main rival Chevrolet first took a stab at Ford, showing TV ads where a load of concrete blocks and the corner of a toolbox are dumped into the F-150’s bed, gashing it, while the same actions in the Silverado’s steel bed result in nothing more but dings and scratches. Unfortunately for GM, the ads didn’t work as desired, with the Ford gaining 16% and the Silverado losing 3% of its volume.
Sales of Large Pickups in the US rose by 5% in Q1 2016 to 508,392 vehicles, which seems like a lot but is in fact 18% lower then the quarterly sales record for the segment over the past ten years (622,244, in Q3 2006). With all models in the segment being relatively fresh, with the exception of the aging Toyota Tundra, one can reasonably expect growth to continue in the coming quarters, at least until gas prices rise and customers start switching to smaller pickups.
Sales of Large Pick-up trucks in the US were up 5.2% in 2015 to 2,187,703 units, and 35.6% of those sales were the best selling vehicle in the US for 35 years running: the Ford F-series. However, as the F-series suffered from slow summer sales due to the change-over to the new, aluminum-bodied generation, the Chevrolet Silverado and GMC Sierra duo combined outsell their main rival for the first time since 2009. The two GM trucks are the only ones to gain share in the segment. Still, a 4% increase to over 780,000 Ford pick-up trucks is the highest volume for the nameplate since 2006, but a long way from the almost 940,000 sales in 2004.
The Large Pick-up segment grew by 8% in the third quarter of the year, and 5% in the first three quarters of 2015.
The Large Pick-up segment grew by 4%, the exact same rate as the overall market, which is only appropriate given that to many this segment epitomizes the US car market. And as has been the case for many, many years, the Ford F-series is the segment leader with over 350,000 units sold in half a year. Clearly, customers have embraced the aluminum components in what has traditionally been an old-fashioned segment. [Read more…]
So, we’ve recently talked about how competition keeps the automotive industry alive. Now let’s talk about how government intervention in competition also keeps the industry alive, but at a cost to the consumer. I’m talking about the infamous “chicken-tax”, the 25% import duty the US government charges on every imported light truck (including commercial van or pick-up trucks) that reaches American shores.
It is called the chicken-tax, because it was introduced in 1963 by President Lyndon B. Johnson as a childish response to tariffs placed by France and Western Germany on imported US poultry. So it has been around for more than 50 years and during those decades it has brought North American manufacturers of pick-up trucks a windfall of profits, all at the expense of the American consumer. Because the biggest victim of these tariffs aren’t the foreign automakers, but the domestic truck buyers.
This import duty has caused the American pick-up market to become an isolated market, controlled for 85% by just three automakers: General Motors, Ford and Fiat-Chrysler Automobiles, with pick-ups that are barely exported to other parts of the world, but which deliver huge margins of more than $10.000,- per truck sold (or, as the Automotive News reporter calculates: roughly the median household income in Greece). Compare that to the compact and midsized sedan market, where the Japanese have been kicking the domestic manufacturer’s butts for decades and the Koreans have joined the party a few years ago. Especially the midsized sedan segment, where the Toyota Camry is king, followed by the Honda Accord and Nissan Altima, is a fiercely competitive segment, where few automakers actually turn a profit. [Read more…]