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Will Detroit Ever Regain The Middle Market?
hpmctorque
Member Posts: 4,600
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.
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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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...
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... ;-)
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...
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.
Rocky
Rocky
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
Rocky
Can = yes
Will = beats me, not if they continue to operate as they have the past few decades.
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.
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.
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.
:surprise:
29 ? Whoa. I thought you were in your 40's based on your broad knowledge of older cars :P
Rocky
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?
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.
Isn't that the truth.
Rocky
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
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.
Rocky
If all people had was the mainstream media, GM, Ford, and Chrysler would went under 10 years ago.
Both companies are on the right track now that they both have resign that they will never have 30% of the market anymore. They are now running their companies based on 20% and 15% market share and controlling production (the key to profits). GM needs a clean launch of the '08 Malibu and for Silverado sales to remain strong. They should be fine. A smaller and leaner company but a much stronger company ready to deal with the global market. Quite honestly, who cares if they are no longer number 1. Ford needs more new products quickly. With the sales of the F150 and Explorer declining, they need more sales from their other products to make up the lost in profits. Quite honestly after the Fusion/Milan and Mustang, it is slim pickings in their current lineup. Even analysts are saying the upgrades to the 500..I mean Taurus aren't going to be enough. The decision to bring products from Europe will help (hmmmm, why does the European market have better cars then the NA market?). it's a matter of can they get the products into the dealership fast enough.
You can keep blaming the media all you want, this problem lies squarely in the laps of the decision makers at GM and Ford. BTW I owned a 2001 Malibu, the one "you knew America could build". That car exemplifies the bad decision making by GM. They not only built the Malibu but used the same parts to make the L-series and Grand Am. Guess what happened? they all had the same problems. Bad alternator, intake manifold gasket leak, bad brakes, electrical problems, etc. But of course that is the media's fault.
My suggestion is to make your selection based on such factors as styling, comfort and driving dynamics, because all the major brands are good today. While in the '80s it was somewhat of a challenge to find a good car, because the bad ones outnumbered the good ones, today it's the opposite.
I'd certainly agree with that part!
I'm not sure about how much the quality gap has closed. I am sure that is because I was hearing it for years when it wasn't so. I suspect now it is but now I get caught in the boy who cried wolf syndrome.
Now I have a nearly 8 year old Accord that works just fine so my next vehicle is likely coming a long time from now, but when it does I'll look at all sorts of things.
The Ford Fusion/Mercury Milan are doing okay, sales wise, but they haven't really busted through the Asian dominated front ranks. They're solid products, and have gotten good reviews on quality, so they should continue to enjoy decent sales. The jury is still out on Taurus/Sable. The new 3.5 V6 and 6-speed automatic, plus the styling tweaks, have transformed these into excellent excellent family cars, and great values.
The Chrysler Sebring/Dodge Avenger, while better cars and better values than their predecessors, aren't cutting it with retail customers. There's talk about refreshing these on an accelerated timetable, but the time line on those changes is a couple of years away. That's a long time to depend on fleet sales to keep the factories open. Between now and the refreshings, look for creative marketing and financing, and maybe spring special editions, to appeal to retail buyers. One thing is for sure; it will be easy to rent a midsize Mopar.
So, for the near term, the '08 malibu is the next big hope.
But as far as Americans buying middle-sized cars overall, it looks to be all Japanese with some Korean purchases buffeting them softly from the sides. I think the new Kia Optima is a great middle-sized car and it would be between a new Optima and a new Malibu for my buying dollars probably.
People can't seem to get over the Toyota Camry and the Honda Accord and I would reallly rather buy an Optima, Malibu or even a Mazda6 before I'd sell out and buy one of those appliances. Ouch, they can't seem to design a decent mid-sized car in Toyota and Honda-land. Bodystyle-wise I'm talking here...they do absolutely nothing for me and I want my rig to do something for me in that department.
2021 Kia Soul LX 6-speed stick
It's those folks those that are going to be tough to crack because they see no reason to go with something different. 450,000 people buy one every year. and I highly doubt .1% of them is going to even take notice of a lowly Chevrolet. Heck, they probably had a bad experience with one or two in the 90's which probably drove them to the Camry in the first place!
So I am curious as to what you find missing in those two yet find in (for example) the new Malibu? Heck, park an 08' next to a Camry especially and the profiles are identical. Size wise, the Malibu is bigger but interior volume is supposedly smaller.
This is good looking :confuse: Blech :sick:
Now on top of that, try convincing some stubborn 3 time Camry buyer that they need to switch to a Chevrolet midsize. Tell them they need to go for a car with worse depreciation, a car that is expected to cost the same amount of $$$ as a new Camry and one that hasn't had the same reliability/quality reputation to fall back on.
Tough sell if you ask me. And I'm not even an Accord/Camry owner!
I would trust a 2008 Kia Optima, a 2008 Chevrolet Malibu and a 2008 Mazda6 entirely enough to spend anywhere from $16,494 for the Optima to upwards of $21,000-$25,000 for the Malibu's and Mazda6's.
This is all fantasy-land for myself as I much prefer my '08 Mitsubishi Lancer GTS and it's racing getup than a mid-size car. Although the Mazda6 looks more and more like a great choice for a sporty ride and good looks. And I'm not one that likes Mazda's blocky-chunky styling etiquette, either.
2021 Kia Soul LX 6-speed stick
The General has to do things BETTER than Toyota if it wants to win customers back.
It can't be "just" as good.
What is the incentive to change if your other choice is only "just" as good as your current one?
The upshot is that GM needs to build on its momentum. Fixing Pontiac and Buick would help a lot. Ford needs to gain momentum. Maybe its plan to offer some of its successful European models will do the trick. Chrysler needs new mid range products to compete effectively.
The Big 2 will be left to carry on the U.S. auto makers. GM is going to take back what Toyota took this last year. I believe it will happen in about 3-5 years. I also believe Ford will take the #2 spot back from Toyota in the next 5 - 7 years.
2021 Kia Soul LX 6-speed stick