Monday, October 1, 2007

Big trucks and big prices equal record sales

Supersize trucks are selling so well that manufacturers are rushing out new versions, like Nissan's Titan King Cab.
Supersize trucks are selling so well that manufacturers are rushing out new versions, like Nissan's Titan King Cab. (CNS PHOTO COURTESY OF NISSAN)

As gasoline prices go up, sales of gas guzzlers go down. Right?

Apparently not, if you're talking about big pickup trucks. Though sales of some pickups seem to be stalling as gas prices increase, sales of the biggest pickups seem to be heading toward record levels. In fact, the bigger a pickup is, the heavier it is and the pricier it is, the better it seems to be selling.

Take for instance General Motors, which reported halfway through 2007 that they had an inventory backlog of more than 700,000 unsold Chevrolet and GMC pickups. Despite that, there was only a few days' supply of its biggest, baddest models such as the LT3 long bed Crew Cab 4x4 - which starts at $36,515.

Toyota is attempting to break into the full-size pickup market this year with its redesigned and greatly enlarged Tundra. Toyota said it was hoping to top 200,000 units for first-year sales. The Tundra is being offered in sizes such as regular cab, extended cab, double cab, and an especially huge CrewMax. Sales at the low end of the product lineup needed incentives - zero percent financing - after just a few months on the market, to juice sales. But Toyota said it was shocked to find that sales of the CrewMax were "way beyond expectations" - no incentives needed. So production was shifted at Toyota's new San Antonio, plant away from the smallest, regular cab models to more CrewMax models. Still, Toyota said CrewMax demand was out-stripping supply. So Toyota said it would not only consider shifting more production toward its largest pickups, but also study new variations, trim lines, and model offerings in the market's high end.

Sales of Ford's F-150, the perennial best-selling vehicle in the United States, are expected to drop about 10 percent from the 800,000 or so sold in 2006 (a record 940,000 were sold in 2004). But there is no drop-off at the high end of the market. In fact, the top-of-the-line Harley-Davidson SuperCrew is back-ordered in some areas of the country, despite its $39,355 base price. Sales are also reported to be brisk for the King Ranch trim package, also at the top of the F-150 line. And these are vehicles that get 13 miles per gallon - or less - on premium fuel, around town.

Ford said it conducted research into what was driving the pickup market. They found, "Buyers want maximum luxury, V8 power, ultra sport, uncompromised utility."

Nissan found pretty much the same thing when they asked potential buyers what was lacking in its Titan line of big pickups. The one thing shoppers wanted that the Titan did not offer was a long cargo bed with its King Cab models. So, a version with a 7-foot-3-inch bed was rushed to market this summer. Nissan says the Titan King Cab now offers the biggest cargo box "in its class."

Dodge is said to be studying an 8-foot bed for its Mega Cab models. The popular Mega Cab is hampered somewhat by only offering a 6.3-foot bed. When creating the Mega Cab - reportedly the biggest in the industry - Dodge cut a foot and a half out of the bed and lengthened the cab by a corresponding amount. It's selling well despite the bed limitations, fuel economy in the low teens, and a sticker price that starts at $40,540.

All these top-line trucks, with options, can push $50,000. But they are far from the most expensive models on the market. Ford, Chevrolet, GMC, and Dodge all offer larger heavy-duty trucks that, while they sell in smaller volumes, do more and cost more. They also sell well, regardless of gas prices. In fact, models like Dodge's Ram 2500 and 3500 models, especially those with Cummins Diesel engines, have almost a cult following.

There are also the luxury liners of the industry. Lincoln, which flubbed in the truck market a few years ago with its now-discontinued $52,000 Blackwood pickup, is back with an F-150-based LT model that has a base price of $41,495.

But at this end of the market, lowering your price doesn't necessarily translate to increased sales. A good case in point: Cadillac's Escalade EXT just keeps going up in price, setting records for what can be charged for a pickup. The EXT now starts at $53,975 and can easily top $60,000 fully loaded. Buyers, Cadillac notes, "can't get enough of 'em."

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