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Will Detroit Ever Regain The Middle Market?

hpmctorquehpmctorque Posts: 4,205
edited March 8 in Chevrolet
The Camry, Accord, and, recently, the Sonata now control the lucrative and strategically important sweet spot of the family car market, replacing the once dominant mid and high-level trim Chevys, Fords, Plymouths, as well as the Pontiac Catalina, Olds 88, Buick LeSabre, Mercurys and Dodges. What are the chances that such models as the Chevy Malibu and Impala, Pontiac Grand Prix, Buick LaCrosse and Lucerne, Saturn Aura, Ford Fusion and 500, Mercury Milan and Monterey, Chrysler Sebring and 300, and Dodge Stratus and Charger will eventually take the sales crown back from the best selling Asian models?

I believe this is an important challenge if the domestic manufacturers are to avoid becoming niche players. It seems to me that while not all of the domestic models need to be huge sellers, some will have to achieve comparable volumes to their leading Asian counterparts for GM, Ford, and the Chrysler component of Daimler-Chrysler to succeed long-term. Your thoughts?

The rapidly growing markets outside North America must be included in a comprehensive discussion, of course, but this discussion is about North America only.
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Comments

  • wonderwallwonderwall Posts: 126
    I think a major issue for domestic automakers is that so many Gen Xers and Gen Yers grew up with the perception of American cars being inherently inferior in terms of reliability to Japanese cars and inferior in terms of style and driving dynamics to European cars. These perceptions are-- let's face it-- based on fact. Those individuals of my age that I know who bought domestic vehicles did so on one factor and one factor alone-- they couldn't afford anything else. All of them appear to have the sense that they settled for an inferior car. In our area, domestic cars frequently appear to be sold at prices below even the Korean makers (just bought an Elantra and probably could've gotten a Cobalt for a little less) once you factor in all of the incentives and so forth.

    I think it's an major uphill battle for domestic car makers to capture our market. In any sales situation, perception is everything. I do feel, having ridden in domestic vehicles and driven a few for short periods of time, that the perception is correct. In the end, when I bought a car -- and I prefer driving compacts-- the only domestic car in that class that didn't look and drive like a pile of random parts thrown together was the Ford Focus and I didn't want to buy that because of what I know of it's reliability history. At that point, I wound up buying a Mazda PR5 and loved it until it was totalled and I wound up being sold on this Hyundai (desired, but couldn't quite afford a Mazda 3). I think as the Koreans begin to prove themselves more and more with quality products, we may see dmestic cars fall further and further behind because they will have no advantage. It's kind of sad, but look around, I think we're beginning to see that it is true, as goes General Motors, so goes America. I mean, at risk of being incindiary, look at who is running this country right now...
  • john_324john_324 Posts: 974
    I think the "perception" point is spot-on.

    It's one of the big reasons why Detroit sells as many middle-ground cars as they do these days...older consumers who remember the firms from their glory days, and still have the perception that American cars are the best out there. After all, these consumers remember when the time when Japanese cars were inferior and cheaply-made, and seemed like utter wastes of money compared to solid and dependable American vehicles. Neither situation is the case anymore, but try telling that to your old Uncle Fred, who's still angry that Oldsmobile is gone... ;-)
  • wonderwallwonderwall Posts: 126
    my grandfather recently bought a 1998 Camry, but at the beginning of his search, he was a little perplexed because Olds was, for the most part, out of the running because he didn't want to buy an orphan. My grandmother convinced him to buy her a 1989 Honda Accord about 15 years ago, but he put up tons of resistance because of Pearl Harbor. I remember telling him, "I think they paid for that many dozens of times over at Nagasaki and Hiroshima." He wound up loving the car and its "sporty" driving dynamics and to replace his dying 1988 Olds 98, he bought the Camry and is in LOVE. They still have that Accord. Something like 150,000 miles and it's just now starting to nickle & dime them, mostly cosmetically. He's still marvelling at the fact that the digital clock in it still works perfectly.
  • carlisimocarlisimo Posts: 1,280
    At this point... if Detroit does a great job, they'll regain a fair share of the market. But to take control of the market again, the other players would have to really drop the ball. All at the same time. Simultaneously with strokes of brilliance from GM, Ford, and/or Chrysler. What are the odds of that?

    I also don't think "the domestics" will share equal fates. Sure they have things in common (past mistakes, truck dependence, UAW), but they're taking different paths (especially globally). Just in the same way that "the imports" operate as a unit, either. It's just an easy, simpleton division for us to make...
  • pernaperna Posts: 533
    GM and Ford really screwed themselves with two entirely different generations.

    Baby boomers: 100% crap product in the 70s and 80s. Many of those cars were so bad, people twitch when they talk about their 1982 Dodge Aries K.

    Gen X: The SUV craze in the 90s. They put zero dev money into anything that didn't stand a mile above traffic and have 4WD, so what are people who hate trucks like myself supposed to buy.

    The answer for both generations was imported cars, mostly Japanese, all vastly better than their American competition. Back in '03, I bought my aspirational car at the time, which was a Nissan Maxima. No American mfg in early '03 had a car that came close.

    And you know what? In the past 3 years, the Nissan has proved itself to be the best car I've ever owned. Guess what my next car is going to be? Oh sure, I'll test drive anything I perceive to be serious competition to my car, but it is entirely possible that I will be a lifelong Nissan customer based on how incredible this car is. Their stock will certainly be heads above all others when I'm out shopping. Any GM or Ford will have to blow me away to get me to switch, and the slow/dull Five Hundred or boring Impala is going to get me to take a look.

    At 32 years old, I am a Gen-Xer, and as such have many car buying years in front of me. It was Gm and Ford's obsession with SUVs at the expense of their car lines that cost them my business - for the sake of their businesses and America, I hope they turn the corner.
  • bumpybumpy Posts: 4,435
    that the domestics DO have a competitive share of the midsize sedan market, but that they dilute that position by spreading it through half a dozen models and a bazillion trimlines, rather than one model and three trims like their Asian competitors do.
  • carlisimocarlisimo Posts: 1,280
    They do sell a large number of cars, but they haven't made much money on them. Giving up profits has kept their numbers high. That's fine in terms of market share and presence, but it's a downward spiral of red ink.
  • john_324john_324 Posts: 974
    Chevy's "most popular car in America" or whatever tagline is ringing increasingly hollow these days. I laugh every time I see it...talk about fiddling while Rome burns...
  • wonderwallwonderwall Posts: 126
    and i alluded to it in my first post, i feel less of a stigma driving my Hyundai than if I had a Chevrolet or a Pontiac. GM, in particular, seems to carry a big stigma in cars with young people. But then again, me and most of my friends eat sushi, majored in the Humanities or Social Sciences and voted for the smart guy in 2004, so we're probably "unAmerican".
  • rockyleerockylee Wyoming, MichiganPosts: 13,989
    The smart guy in 2004 ? :confuse: LOL Was there one :surprise:

    Rocky
  • rockyleerockylee Wyoming, MichiganPosts: 13,989
    My question is will there be such a thing called the Middle Market in 20 years ? :sick:

    Rocky
  • ubbermotorubbermotor Posts: 307
    Columbia was once America's best selling brand. 20 years ago Oldsmobile sold more cars than Ford (1985 1165649 vs 1149427). Five years ago Cadilliac finished its 50th consecutive years as America's luxury car leader (in sales). In 1975 Chrysler had 2 distict models for the first time ever, in 2005 they sold more cars than Dodge. I've been following the auto industry for nearly 30 years, I know better than to try and predict what its going to do in 5.
  • rockyleerockylee Wyoming, MichiganPosts: 13,989
    Do you think if GM loses the #1 spot, do you think it could regain it's crown again ?

    General Motors vs. Toyota

    It's sound like a great prize fight. Peter Manfredo Jr. vs. Sergio Mora

    I personally think if GM loses it's crown in 2006, GM Will win it's title back in a rematch in 2007'

    GM will be "undisputed" Champion in 2007' and knockout Toyota for good. :shades:

    Well that's the way I have dreamed it up :blush:

    Rocky
  • dieselonedieselone Posts: 5,650
    Do you think if GM loses the #1 spot, do you think it could regain it's crown again ?

    Can = yes

    Will = beats me, not if they continue to operate as they have the past few decades.
  • grbeckgrbeck Posts: 2,361
    wonderwall: "But then again, me and most of my friends eat sushi, majored in the Humanities or Social Sciences and voted for the smart guy in 2004..."

    If you believe that, you really do need to get out more...

    Incidentally, according to a recent news story, the most cross-shopped brand with Hyundai is...Chevrolet. So there must not be too much stigma associated with owning a Chevrolet among Hyundai intenders and buyers.
  • carguy58carguy58 Posts: 2,303
    "Gen X: The SUV craze in the 90s. They put zero dev money into anything that didn't stand a mile above traffic and have 4WD, so what are people who hate trucks like myself supposed to buy."

    I am a generation Xer myself being 26 years old and your're right in the 90's American Car Companies forgot about cars and just concentrated on SUV's. I grew up on GM and Ford cars because my parents always owned them and yes they are boomers. When I bought my first car I stayed away from American Cars because of perception(bad reliability.) I bought a Mazda 626. My second time of buying a car I stayed away from Detroit makes and even Toyota because of looks. Again I bought an Acura CL. I am a big Mazda and Honda guy and I just don't care for Domestic Big 3 cars. I mean Chrysler is the best domestic that Detroit has to offer. I still don't think I would buy a Chrysler over a Mazda or a Honda right now even though Chrysler has some great products stylewise right now and their interiors aren't half bad either.
  • lemkolemko Posts: 15,189
    I'll be 41 in May, so that must make me a "proto-GenX'er."

    I grew up on Ford and Chevrolet cars because my parents and grandparents always owned them. Dad was from the generation between the "Greatest" and "Boomers" and Mom was among the first Boomers. When I bought my first car I immediately went straight to General Motors because of perception,(extremely good reliability.) and bought a Buick Special Deluxe. The perception was true! I went back to Buick and got a Park Avenue! I am a big Cadillac and Buick guy and just don't care for imported cars. Lexus is the best the imports have to offer but I wouldn't choose a Lexus over a Cadillac or a Buick even though Lexus has some great products reliability-wise and their interiors are really nice.
  • fintailfintail Posts: 33,806
    I'll be 29 soon...so I am a late Xer I think. My parents are older than most my age, pre-boomer. They were pretty loyal to big 3 cars when I was growing up, and they had more than a couple lemons. Because of that, I have a jaundiced eye, especially towards middle market domestics. Fall-apart Blazer, Clunky Ciera, Tauri that ate both head gaskets and trannies, we had em all. I have a suspicion my experiences are mirrored by many my age.
  • rockyleerockylee Wyoming, MichiganPosts: 13,989
    I'll be 29 soon...so I am a late Xer I think. My parents are older than most my age, pre-boomer.

    :surprise:

    29 ? Whoa. I thought you were in your 40's based on your broad knowledge of older cars :P

    Rocky
  • fintailfintail Posts: 33,806
    I have mature tastes I guess
  • carguy58carguy58 Posts: 2,303
    "I am a big Cadillac and Buick guy and just don't care for imported cars. Lexus is the best the imports have to offer but I wouldn't choose a Lexus over a Cadillac or a Buick even though Lexus has some great products reliability-wise and their interiors are really nice."

    You seem to be more into "traditional luxury brands" if you know what I mean like Caddy, Buick, and Lexus. I was wondering if you like a car like the Volvo S60 or a Mercedes since you seems more into traditional luxury brands. You don't seem like the type of person that would be into sport luxury brands like Acura, Infinti, or BMW. I don't think judging by your tastes you would like a car like a Pontiac Solstice. How do you feel about Caddy;s Art & Science styling theme like with the CTs for example?
  • lweisslweiss Posts: 342
    I am in my late 50s (baby boomer) and one of the things characteristic of my generation is that we want to think young and do things like younger people- hence all of the cosmetic surgery, dieting, Viagara (Haha), buying things like that- and not to be associated as an old fogey. So for me, even my current 1998 Volvo S-70 seems old- my next car will be a Mazda 6 Speed, maybe the new Nissan Altima, an Acura TL will be a contender. GM models- no way, my kids (all in their 20's) would laugh me out of town.

    And I don't think I am alone. I've read that the Honda Element, designed for young people, has a sizeable following with baby boomers. And we can afford what we want to buy.
  • lemkolemko Posts: 15,189
    I was always very much into traditional luxury cars, even when I was very young. I don't care much for Volvo, but I could see myself in a Mercedes S-Class if the maintenance and repair costs and recent concerns about reliability didn't scare me off. A Pontiac Solstice is a nice toy for a nice sunny day or two, but I can't see myself purchasing one. I kind of like Cadillac's Art & Science theme because they had to do something in face of the challenge by the imports and it seems to be working. Lincoln is so far behind Cadillac and the imports it's not funny. Ten years or so ago, I would've liked a new Lincoln Town Car. Now it comes across more like a gussied-up Crown Victoria.
  • rockyleerockylee Wyoming, MichiganPosts: 13,989
    I kind of like Cadillac's Art & Science theme because they had to do something in face of the challenge by the imports and it seems to be working. Lincoln is so far behind Cadillac and the imports it's not funny. Ten years or so ago, I would've liked a new Lincoln Town Car. Now it comes across more like a gussied-up Crown Victoria.

    Isn't that the truth. ;)

    Rocky
  • rockyleerockylee Wyoming, MichiganPosts: 13,989
    Off-road icon may have outlived its utility

    General Motors Corp.'s Hummer H1 -- a tank-like SUV used by the U.S. military, sold to the public by GM, and reviled by environmentalists everywhere -- soon may be decommissioned.

    While there is no decision yet, Hummer's new general manager, Martin Walsh, said in a few years, the slightly smaller H2 sport utility vehicle could replace the H1 as the brand's flagship model.

    The H1, with fewer than 400 sales last year, is still "very important" to the brand's image as an off-road leader with iconic design, Walsh said.

    "What we've found increasingly, though, is that the H2 has come to be seen by consumers as the Hummer. In their minds, that's more representative of the Hummer brand than the H1."

    The comments come as Hummer is trying to broaden its appeal to consumers and as gas prices hover near $3 per gallon.

    In less than 15 years on the U.S. auto market, the H1 has become a status symbol to the moneyed elite -- thanks to enthusiastic endorsements from Arnold Schwarzenegger and hip-hop artists -- and a gotta-have-it toy for hard-core off-roaders.

    But its $140,000 price tag, poor fuel economy and massive size have made it impractical for many customers.

    "People still like to come in and look at them, but no one buys them anymore," said Dan Frost, owner of Hummer dealerships in Detroit and Novi. "We might sell one, maybe two a year."

    The H1 is based on the High Mobility Multipurpose Wheeled Vehicle, popularly known as the "Humvee," which was created by AM General Corp., a military contractor. It went on sale as a civilian vehicle in 1992, and was initially boosted by its exposure in the first Gulf War.

    Seven years later, GM acquired exclusive ownership of the Hummer brand name, and in 2002 added the beefy H2. Last summer, the H3, a midsize SUV that achieves 20 miles per gallon, joined the lineup and now accounts for more than half of Hummer's annual sales.

    In 2005, after a hurricane-fueled spike in gas prices, H1 sales fell 16 percent and H2 sales plummeted almost 30 percent -- a sign that the brand's biggest growth potential may rest in smaller, more fuel-efficient vehicles.

    Walsh said Hummer would consider building a pickup truck, but would not -- as the Chrysler Group's Jeep brand recently started to do -- build car-based "crossover" vehicles.

    The "product expansion" planned for the Hummer brand will be based only on rugged truck frames, he said.

    Aside from adding a high-performance Alpha version last year, GM has done little to change the original H1, a vehicle it markets as "the most functional off-road vehicle ever made available to the civilian market."

    Perhaps that's because the ailing automaker knows it cannot afford to throw money at a vehicle with such a small audience, said Erich Merkle, an industry analyst with IRN Inc. in Grand Rapids.

    "There never really has been much of a market for that vehicle, except with the ostentatious crowd."

    Hummer continues to require its dealers to accept at least one H1 a year, but with fuel economy becoming a bigger concern for consumers, it may get harder to sell a vehicle that gets 10 to 12 miles per gallon.

    Yet Walsh left the door open to H1's future.

    "It's still a part of our plan," he said. "Beyond that, I really can't say."

    http://www.detroitnews.com/apps/pbcs.dll/article?AID=/20060430/AUTO01/604300342/- 1148
  • british_roverbritish_rover Posts: 8,476
    That part about people IDing the H2 as the "real" Hummer is very true.

    Selling Land Rovers I see a lot of H2's we actually got one stuck on our off road test track in the first two feet because the vehicle is so pathetic off road. When someone says they have a Hummer I normaly ask, "A real one or a H2."

    To which they reply sometimes sounding hurt, "I have a H2 which is the real hummer not that little baby H3."

    Most of them do not even know what the H1 is.
  • rockyleerockylee Wyoming, MichiganPosts: 13,989
    Actually in certain situations the H2 is better because it's more nimble and atheletic. Ya know lighter on it's feet just like Floyd Mayweather Jr. ;)

    Rocky
  • hpmctorquehpmctorque Posts: 4,205
    Most of the recently and soon-to-be-introduced domestic cars and trucks are positioned in the middle market. Therefore, to the extent that they succeed, Detroit will have regained relevance in the marketplace, or, hopefully not, visa versa.
  • hpmctorquehpmctorque Posts: 4,205
    The Saturn Aura and '08 Chevy Malibu, the Ford Fusion and '08 Taurus, and the Chrysler 300 are strong domestic entries.
  • scape2scape2 Posts: 4,119
    Image is what GM/Ford need to overcome with consumers. All these years of the media bashing them at every turn has not helped either. Don't get me wrong, GM/Ford have made thier mistakes, but so has Toyota and Honda. Whenever GM/Ford has a recall it is all over the headline news! If Toyota/Honda have issues it makes a small column in the back page. I have seen this over and over again. I run into people who think all GM/Ford products are pure junk and would never step foot into a dealership. Thank goodness for the internet and the free flow of information. I have linked numerous people to other sites showing them data about both GM/Ford vehicles vs Toyota/Honda vehicles and they are surprised.. :shades:
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