GM sees light truck recovery

Oct. 16, 2006
PHOENIX. General Motors Corp. expects sales of light trucks, both pickups and sport utility vehicles (SUVs), to rebound in 2007 as gas prices continue to fall and more fuel-sipping designs come to market, such as its ’07 model Silverado and Sierra pickups

PHOENIX. General Motors Corp. expects sales of light trucks, both pickups and sport utility vehicles (SUVs), to rebound in 2007 as gas prices continue to fall and more fuel-sipping designs come to market, such as its ’07 model Silverado and Sierra pickups.

“Truck popularity has increased 25% since 1998 and pickups now make up 15% of total U.S. vehicle sales,” said Russ Clark, general director of marketing for Chevrolet speaking here today at a GM ride-and-drive event. “We’ve seen a drop off in [light truck] sales this year, with $3 a gallon gasoline as one reason, but we believe sales will bounce back in ’07, climbing to 2.5 million light truck units from 2.3 million sold this year.”

Clark added that three basic “selling points” of light trucks haven’t changed: they must have power, pulling capability and good payload capacity. What has changed, however, is rising demand for bigger cabs and more “creature comfort” options even for commercial users.

“In 1999, there were very few crew cabs in the pickup market,” he said. “Now 50% of the pickup market is made up of crew cabs. Ride and handling is becoming a much bigger issue, along with more interior refinement such as standard lumbar seats. People work every day for long hours in these trucks. Modern businesses demand that these kinds of features are there.”

Pricing is also important, so GM hopes to keep sticker increases to a minimum or add more standard features if model costs do go up. “For example, we’re adding tire pressure monitoring and stability control as standard on our crew cabs,” Clark said. “Upgrading to our new 5.3 liter V8 engine that incorporates active fuel management will cost just $600 versus $1,500 in previous models. Those are the kinds of value pricing initiatives we’re taking.”

GM’s OnStar system is also now a standard feature on all its trucks—a $200-value, added John Schwegman, Chevrolet’s marketing manager for the Silverado and Avalanche pickups. However, having OnStar on board could open up new options for commercial users.

“You can get automated turn-by-turn voice navigation by paying just $100 a year by having OnStar on board,” he said. “A comparable upgrade to a full onboard navigation system with computer screen to display maps would cost $2,000. So not only does a fleet get a less expensive navigation option, their drivers can keep both hands on the wheel and their eyes on the road using it. They don’t have to look at both the road and the map screen to find out where they are going.”

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About the Author

Sean Kilcarr | Editor in Chief

Sean previously reported and commented on trends affecting the many different strata of the trucking industry. Also be sure to visit Sean's blog Trucks at Work where he offers analysis on a variety of different topics inside the trucking industry.

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