Counting Cars

Whither Went GM’s Pickups? Company Too Slow to Move on February Incentives?

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As company set sights on Toyota did it lose focus in key segment?

GM sold fewer pickups on a daily basis in February than in any month since at least January 1980, and likely well before that.

Had pickup sales been just 1.2% higher, GM would have avoided the embarrassment of being outsold by Ford in total vehicles for the first time in over a decade.

Unlike deliveries on some of GM’s most popular models, pickup sales aren’t suffering from a depletion of inventory: light-duty Chevy Silverados and GMC Sierra pickups are both days-supplies above 120. Nor does the slowdown in sales due to February snowstorms explain why GM’s share of the pickup segment dropped from 40% in January to 32.7% - its lowest piece of the segment since October 2005.

And while the reduction in GM brands has hurt the company’s overall year-to-year sales comparisons –the removal of Pontiac, Saab and Saturn should allow the company to focus more resources than ever on its core endeavors, including selling pickups.

Instead, Ford beat GM in light pickup sales by the largest percentage (20.4%) since August 2005. While Ford’s sales relied on strong fleet sales, GM fleet sales also jumped dramatically. According to GM, Chevy’s poor retail performance (up just 1% over a terrible Feb. 09) was due primarily to a diminished share of the retail truck market.

GM seems to have been too slow to counter Ford’s incentive programs perhaps pointing to a blind spot in their overall marketing strategy, which has emphasized GM’s emergence as the maker of quality cars and crossovers.

Ford incentives on F-250s and F-350s large pickups rose by a $1,000 in February, to a high of about $4,000 while GM stayed pat in February with investments on Sierra 2500 and 3500 pickups topping out at $2,000.

It’s possible the company grew complacent after outselling Ford in the pickup segment in prior months with incentives roughly $1,000 less than Ford’s on large pickups. But when Ford upped the stakes in February, increasing the spending difference to as much as $2,000 on some vehicles, GM was left behind

It’s also possible that in its rush to take advantage of Toyota’s troubles with incentive plans aimed directly at current Toyota owners, GM simply overlooked this key segment for domestic auto makers.

On the potentially positive side, there are indications that GM truck buyers simply stayed out of the market in February - perhaps waiting for GM to step up incentives. If that’s the case, GMC and Chevy March pickup sales should, well, pick up.

GM has pointed to increased transaction prices as an indication of the company’s growing health. But with all the key players in the pickup segment announcing widespread incentive programs for March, it may take some serious spending by month’s end for GM to get its share back.

Otherwise, GM may find itself as the “car and crossover” company well ahead of schedule.

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John Sousanis

John Sousanis oversees WardsAuto data operations as Director of Information Content, and is Ward’sAuto sales analyst. Follow John on Twitter @CountingCars.  

Haig Stoddard

Haig Stoddard is a veteran automotive industry analyst. His current focus is North America production and longterm sales forecasting.
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