Pickup trucks rising, thanks to oil boom
Ford forecaster: Housing market is 'big missing factor in this recovery'
Photo credit: Greg Horvath
TRAVERSE CITY, Mich. -- Full-sized pickup sales are rebounding to big volumes -- even without the complete return of new-home construction.
“The big missing factor in this recovery so far has been the housing market,” said Emily Kolinski Morris, chief economist for Ford Motor Co., told an audience Tuesday at the 2014 Management Briefing Seminars.
Through the first seven months, U.S. sales of full-sized pickups rose 4 percent to 1.1 million units in an overall market that increased 5 percent. Ford F-series sales were up slightly to 429,065 vehicles. Chrysler's Ram brand led the gainers with a 19 percent surge to 239,481 units. Chevy Silverado sales fell 1 percent to 282,776 units.
The segment generated sales of 1.91 million units in 2013. It topped 2.1 million in 2007, and then collapsed to 1.1 million in 2009, according to the Automotive News Data Center.
Morris and other industry forecasters predict a stronger performance for the segment.
That outlook is good news for a number of automakers -- including Ford rival General Motors -- as Ford prepares to launch the redesigned 2015 F-150 pickup with an aluminum-intensive body.
Nissan Motor Co. also has begun promoting a redesigned full-sized Titan pickup that will not reach the market until 2015.
“As we look a little bit further out, we see the potential for some additional upside, particularly in full-sized pickup sales as the housing recovery eventually catches up with the rest of the economy,” Morris said of the overall U.S. market
Pickups and new-home construction have always moved in lock step. Job site contractors rely on big pickups to haul lumber, plywood sheets and other housing materials. And the 2008 homebuilding crash knocked the life out of the truck segment.
New-home sales are on track to reach about 400,000 this year, a slight decline from last year. By comparison, new-home sales reached 1.28 million in 2005.
But the U.S. oil boom is breathing new life into the segment, Morris said. Energy industry activity and oil drilling have become a new source of truck sales.
In 2010, just 187 oil rigs were operating in the United States. As of this summer, there were 1,545, according to U.S. energy data.
Morris said, “This is something fairly new for us to track.”
Another reason for optimism about segment growth is the age of the full-sized pickup fleet, said Itay Michaeli, industry director for Citi Investment Research and Analysis.
Michaeli said that the current average age for scrapping and replacing older vehicles is between 13 and 15 years. And the full-sized segment’s average age reached 13 years in 2013.
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