Could be sooner than later...
Pickup truck sales latest victim of high US gasoline prices by Mira Oberman
Mon Jul 3, 4:40 PM ET
CHICAGO (AFP) - The pickup truck became the latest victim of high gasoline prices in June, cutting deeply into the profits of US automakers which are reliant upon the gasoline-guzzling vehicles, according to figures.
Sales figures showed sharp drops in sales overall for General Motors Co., Ford Motor Co. and the Chrysler Group as consumers turned towards more fuel-efficient smaller cars, a segment dominated by Asian imports.
Early reports also showed a general slow-down in vehicle prices as US consumers - who have been spending more than they earn for 12 straight months - respond to higher interest rates.
Year-ago comparisons also showed sharp declines because of last year's record-breaking sales after General Motors started a price war with its employee-pricing program.
With gas prices hitting sales of Ford's best-selling vehicles, the automaker expects to see sharp year-on-year declines in July after sales fell seven percent in June, George Pipas, the US sales analysis manager said in a conference call.
"We'll experience double digit declines in July and the magnitude is the only thing to be determined," he said.
Most significant was the decline in pickup truck sales which - unlike full-sized sports utility vehicles which have been declining steadily for four years - have only recently been hit by gasoline prices, Pipas said.
Most pickup truck owners rely on the vehicle for its hauling capacity and are unlikely to switch to smaller, more fuel-efficient vehicles.
And even those who are merely "appearance" buyers are unlikely to switch, Pipas said.
"We believe on the margins there are full-sized truck buyers who are opting out but the exodus factor doesn't seem nearly the rate we've seen in the full-sized SUV market," he said.
"The important question for those (appearance) buyers is how strong is that motivation," he said. "I would say that -- particularly deep in the heart of Texas -- even people who don't need the product the motivation to want the product is very strong."
GM posted its highest monthly sales for the year at 413,473 vehicles but due to a sharp drop in truck and sports utility vehicles and the comparison with last year's record, sales were down in June by 25.9 percent.
DaimlerChrysler AG's US sales fell 13 percent to 206,748 units in June as weakness in the Chrysler Group offset record sales at Mercedes-Benz.
Toyota Motor Sales USA reported record-breaking sales, up 14.4 percent in June at 223,018 vehicles.
"Fuel-efficient products continue to drive the market, even as consumers are likely becoming acclimated to today's fuel prices," Jim Lentz, TMS executive vice president said in a statement. "Buyers are turning to hybrids and smaller, more fuel-efficient vehicles as a hedge against future uncertainty."
American Honda posted flat sales in June at 126,449 vehicles, although sales were up 7.1 percent for the first half of the year at 741,227 units.
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