Sales of pickups languish; new models get delayed
DETROIT -- The imploding pickup market is giving automakers a truckload of trouble they never imagined.
Ford and General Motors underscored the collapse last week by pushing back updates of full-size pickups, long their best-selling, most profitable vehicles.
"In the short term, it's tough," says Dave Cole, chairman of the Center for Automotive Research.
Ford will delay rollout of its redesigned F-150, the best-selling U.S. vehicle for 26 years, by at least two months until "late fall," while it tries to sell down inventory of the current model. GM has halted work on the next-generation Silverado and diverted engineers to car programs.
Behind the decisions is a wrecking yard of bad news for the future of the American pickup:
•Falling demand. Market share of full-size pickups fell in May to 9.3% of new vehicle sales, vs. 18.6% as recently as July 2005, Edmunds.com says. Ford's F-Series and Dodge Ram took some of the biggest hits.
•Potential buyers loaded with debt. At 40.7%, shoppers for pickups are more likely than others to owe more on what they want to trade in, usually also a pickup, than it is worth, Power Information Network says.
Dealers, already awash in used pickups, aren't inclined to offer much for them. "People will buy a small vehicle and keep the truck because they can't trade out of it," says Charles Oglesby, CEO of dealer chain Asbury Automotive.
•Languishing on lots. To sell trucks, automakers are having to offer deep incentives, from $4,226 on a Toyota Tundra to $5,897 on a Dodge Ram 1500, Edmunds.com says. Nissan Titans sold in May had been sitting on lots longest, an average of 132 days, it says.
GM's all-new truck, under development for 2012 to 2014, now is indefinitely postponed.
"We think the market will shrink," GM spokesman Tom Wilkinson says. The company will focus, instead, on "where the growth is, which is cars, crossovers, and advanced propulsion technologies."
Chrysler, however, will go ahead with a planned September rollout of its new Ram pickup, and now won't have to compete with a PR blitz by Ford for its truck. "All systems are go," spokesman Bryan Zvibleman says. "It will be nice to have the market to ourselves."
