Now that cars are making a comeback on the sales charts, executives at General Motors and Ford Motor Co. are shaking their heads and wondering, "Where did we go wrong?"
Leaders of the Chrysler group shouldn't spend too much time patting themselves on the back. The Chrysler 300 and the Dodge Charger have done well, and the Dodge Caliber looks like a winner if production problems can be solved. But the Chrysler people are still sort of wandering in the car-truck woods.
Some GM and Ford executives admit privately that they were slow to prepare for the rebirth of cars. They talk of new cars due to arrive in 2008/2009/2010. Hey, guys, this is 2006, and you need them now.
Good grief, people. Don't you read SalesTales? I've been preaching the car gospel for years.
In the first seven months of this year, the sales mix was 49.7 percent cars, 50.3 percent trucks. That's about as close as you can get to 50-50. Looking back to 1995, it was 58.5 percent cars and 41.5 percent trucks. In 1990, the split was 66.9 percent cars and 33.1 percent trucks.
But the mix for the Detroit 3 is 38.7 percent cars, 61.3 percent trucks so far this year. Isn't the market telling Detroit something?
By company, the split was GM: 42.3 percent cars, 57.7 percent trucks; Ford Motor: 37.8 percent cars, 62.2 percent trucks; the Chrysler group: 32.9 percent cars, 67.1 percent trucks. It appears the Motor City Mob has hitched its wagons to a falling star.
Japanese like cars
Now consider the car-truck ratios during the first seven months of 2006 for the Japanese Big 3: Toyota Motor Sales U.S.A. Inc. (Toyota-Lexus-Scion) and American Honda Motor Co. (Honda-Acura) were both at 57.8 percent cars and 42.2 percent trucks. Nissan Motor Co. (Nissan-Infiniti) was 53.1 percent cars, 46.9 percent trucks.
The current numbers come into sharper focus when you compare them with the results of a few years ago.
In 1990, the domestic brands of GM, Ford and Chrysler sold 61.4 percent cars and 38.6 percent trucks. But by 1995, cars were falling by the wayside. The split that year was 50.9 percent cars and 49.1 percent trucks.
Meanwhile, the Japanese big boys were rather slow to embrace the truck culture. The Toyota, Honda and Nissan groups were 82.1 percent cars and 17.9 percent trucks in 1990. That had changed only slightly in 1995 - to 77.6 percent cars and 22.4 percent trucks.
Now, as noted, the Detroit 3's sales so far this year have flipped to 38.7 percent cars and 61.3 percent trucks; the Japanese Big 3 are at 56.8 percent cars and 43.2 percent trucks.
Clearly, the Japanese still consider cars a mighty important part of the U.S. market. The companies have increased their emphasis on trucks in line with the demands of buyers, but they are still primarily car sellers.
Detroit 3: Truckmakers
On the other hand, cars have become practically an afterthought to the Detroit 3. The attitude seems to be "We'll make a few just in case somebody wants to buy one, but we're truckmakers, not carmakers."
In 1995, Detroit's Big 3 sold 5.5 million cars. Last year, they sold 3.4 million. They lost 2.1 million car sales in 10 years. Where did those buyers go? A lot of them bought Detroit pickups and SUVs, of course.
But import car sales grew from 3.1 million in 1995 to 4.6 million in 2005. The Detroit 3 are kidding themselves if they don't admit that a lot of their car owners are now tooling about in Civics, Camrys, Altimas, Sonatas and who knows what else. Why? Because the Detroit 3 abandoned the car market for a decade or more.
There's a line in the Bible: What you sow, you also shall reap. Applied to the Detroit 3 and the car market, it might read: If you don't sow, you are not going to reap.
You may e-mail John K. Teahen Jr. at [email protected]