• Apr 19, 2006

To all General Motors executives and news reporters proclaiming the company's new SUVs a rousing success, hold your horses-- at least through the summer. The new GMT900 siblings may be fine vehicles, but gas prices are back up and consumers are starting to feel the pinch again. While full-size SUVs like the Chevy Tahoe and GMC Yukon (pictured) appeal to buyers who would buy an SUV regardless of the state of gas prices, vehicles such like the Chevy Trailblazer and GMC Envoy are arguably more price sensitive purchases. These buyers may in fact choose a more fuel-efficient crossover vehicle instead -- a vehicle doesn't make GM nearly as much money, not to mention the fact that the company is currently experiencing a gaping hole in the mid-size crossover segment, sending potential GM buyers elsewhere.

[Source: Reuters via Stuff.co.za]

 



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    • 1 Second Ago
  • 21 Comments
      • 8 Years Ago
      Bart - "Dad, what's a 'crossover'?

      Homer - "Well, it's not quite a car, and it's not quite an SUV, but man... [laughs] So to answer your question I don't know."



      • 8 Years Ago
      Gas prices do matter. When prices go up sales of low fuel economy vehicles go down.

      People love the "big iron" (big trucks and SUV's) and they will pay a lot to push the extra 1000 lb of steel down the street, but they will only go so far. High gas will lower SUV sales, it is only a question of how much.

      For those that say Toyota also sells big, low-mpg vechicles, I say you are right. Difference is that GM needs big iron to stay solvent (or at least go bankrupt more slowly) for Toyota it is just a bonus.
      • 8 Years Ago
      GM will have the worlds first full size hybrid SUV this year so that should help them steal sales away from the technologically inferior Toyota's, Nissan's, etc. Since GM is leading the charge for hybrid full size SUV's, the high gas prices should actually help them and hurt the foreigner makers who can't keep up with their out of date designs.
      • 8 Years Ago
      The Saturn Outlook and pals are coming. What hole are you talking about? Once the Outlook hits the dealership, crossover sales fly.
      • 8 Years Ago
      Perceptions lag reality and in the auto industry they lag a lot. Sure domestic autos are as good if not better than anything foreign but it may be another 10-20 years before that becomes the perception of your average consumer. GM builds some of the best cars in the world today yet there's still a perception that lingers from the cars they made 20 years ago. Toyota's quality has been slipping badly yet they'll live off their reputation for years. Heck, look at Mercedes. Even Hyundai (!!) has better dependability ratings than what MB's been putting out but people still think they make great cars.
      • 8 Years Ago
      Chris:

      "The Saturn Outlook and pals are coming. What hole are you talking about? Once the Outlook hits the dealership, crossover sales fly."

      The one where I can't go out and buy one right this second and I don't want to wait to buy my car.
      • 8 Years Ago
      Fuel efficient SUV. It's kinda like having a diet coke w/ that bacon cheeseburger, or smoking Marlboro lights.
      • 8 Years Ago
      Michae (sic) III,
      ...gas prices hit $3.00 per gal. There was an initial shock but after a couple of months of higher prices I was still concerned but I obsorbed the cost and got over it...
      Puts a smile on my face to read such comments. I predict you won't be as content when 87 regular hits $4.00-5.00 per gallon this summer.
      As for GM, my prediction is that they will Chapter 11 before giving up on SUV's and large trucks. It wouldn't make business sense to drop a product that has a profit 400% greater than the average vehicle.
      • 8 Years Ago
      In reply to the 22 vs 33 mpg annual fuel consts comment:

      $1818 for a 33 mpg car (in this case a Corolla)

      $2727 for a 22 mpg car (a Toyota Highlander.)

      That's roughly 900 dollars a year extra. For some it's worth it... for some it's not; Apparently you don't mind blowing some extra cash on gas, and to be honest, at these prices, neither do I... my car averages around 21 mpg, and my wife's at around 23.

      However, for every rise in gas prices, a the number who stick with a larger vehicle shrink and the number who refuse drop. The U.K. has noticeably smaller vehicles than we, but you will still see the occasional Land Cruiser or Grand Cherokee roar by on her highways.
      • 8 Years Ago

      #21
      You're right. I think at least getting some more mention that GM actually makes cars too would go a long way though. It's amazing the idea of perception. If someone is told something over and over again, whether it's true or not, you'll start to believe it.

      A friend of mine was in the market recently for a nice, new, small car. He looked at the Civic, the Jetta and, of all things, the CRD Liberty (which he ended up with). Now this guy is smart - he has a Masters degree in oceanography - so he's open minded and understands "reasoning" and looking at every possible option when it comes to making a decision. Anyway, I asked him if he'd even consider a Cobalt - he flat out said, "no way, GM cars suck, and the Cobalt is a poor person's car, they simply suck, why would I want something like that"? - on and on. It's amazing that once people get their minds wrapped around the idea that GM is nothing but an SUV maker and has nothing to offer anyone other than huge Suburbans, there is no changing their minds.

      Now, I'll tell you, the Civic is probably a "cooler" car than the Cobalt, but it really isn't that much better when it comes down to it. They're still just basic transportation.

      GM has some major hurdles they have to jump over right now. If I were VP of marketing or product development at GM right now, I wouldn't be sleeping much.

      They need some halo cars, and quick. They need to put that new hybrid powertrain they're developing with BMW and DCX in every single car they make - including the new rear wheel drive "Zeta" cars. They have to put the best transmissions (6 spd. automatics) in every single car they build. They have to be better than Toyota at everything they do - and let the whole country know that they've been around for 100 years, and that some of the best and most innovative cars in American history came out of their company. If they don't do this, and do it quick, they'll never regain the status they had in the 60s and 70s.
      • 8 Years Ago
      On May 6, demand ethanol free gasoline!!! drop $0.50-0.75 right out of the cost of gas.
      Time for a grassroots movement.
      No carburetors! No ethanol! [repeat]



      For the guy claiming to get 17.5 mpg, what is your tire pressure 75psi?
      • 8 Years Ago
      "Excuse me Mick but where did you get the 22mpg number? You haven't been watching the GM TV ads again where they claim the new Tahoe gets 22mpg HIGHWAY on the EPA test"

      I have a 2001 Silverado Z71 extended cab 4x4 3.73 gears 5.3l engine. It gets 17.5 MPG mixed driving.
      I don`t think a 2007 GM truck with displacement on demand getting 22mpg hwy is much of a strech.
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