Have a taste for big trucks or SUVs? You're not alone. A new study indicates a reverse in a trend of declining SUV and truck sales. Automotive website Edmunds.com is reporting that truck and SUV sales will surpass car sales in December. That's something that hasn't happened since February 2008.
Additionally, hybrid sales are expected to dramatically plunge for December.
Three factors are driving the return to big vehicles, say experts. The first is the bad winter weather, the second is hot deals thanks to a trouble the economy, and the third, and perhaps most significant, is the much lower gas prices. Michelle Krebs, Senior Editor of Edmunds' AutoObserver.com describes, "Despite all the public discussion of fuel efficiency, SUVs and trucks are the industry's biggest sellers right now as a remarkable number of buyers seem to be compelled by three factors: great deals, low gas prices and winter weather."
While the report that 51 percent of vehicle sales in December will be SUVs or trucks certainly indicates that sales are up, they have a ways to go to reach their former peaks, which were even higher, according to market observers. Reports Ms. Toprak, "We don't claim they're back to what they used to be, but it's a reversal of the trend."
The falling sales of trucks and SUVs were a major factor in the fiscal crisis at Chrysler, GM, and Ford. After focusing on big vehicles for decades, the automakers were blasted by some in the government and the public for failing to follow what the public demands -- small cars. Those same individuals noted that the domestic automakers foreign competitors like Honda and Toyota posted stronger sales thanks to the increasing demand for small, fuel-efficient cars.
Eventually the automakers secured a $13.4B USD loan, but it was only have government officials sharp scolded the domestic automakers.
While the impact of decreases in home construction and contracting is still pushing sales down, a combination of other factors is making large vehicles irresistible for some, according to researchers. Edmunds.com reports that on average, trucks this month are coming with $5,200 USD in incentives, making them a hard offer to refuse. And that's not even including at-dealership price cuts that most buyers negotiate. States Ms. Toprak, "I can get about $10,000 off a large SUV, there's probably not going to be a better time."
Next year, however, incentives are expected to decline as the domestic automakers tighten up, and supply of big vehicles coming to market falls.
The rise in large vehicle sales could spell trouble in the long run for foreign and domestic automakers, alike. Companies like Toyota, whose Prius is a best-seller, are expected to post lower hybrid sales for the month. The Prius is considered by many as the barometer for public reception of hybrids, as it is by far the best selling hybrid in the country. Now with gas prices falling from a summer peak of $4/gallon to around $1.67/gallon, Prius' are looking less attractive, and sales are expected to sharply drop off.
In previous months this year, there was a waiting list for the Prius. In November alone, falling gas prices caused a 48 percent drop in sales, and this is expected to continue into December. All this spells trouble for the hybrid heavy Toyota and Honda.
It also may spell trouble for domestic automakers. After decades of going their own way, American automakers are now following their foreign competitors, focusing on small fuel efficient cars and hybrids. With sales down, the domestic automakers may be back to where they started, with the majority of their production geared toward a product the public is not necessarily demanding.
This is evidenced by Edmunds.com's prediction that despite the rise in demand for trucks, GM, Ford, and Chrysler's combined market share is actually expected to fall one point to 51 percent. Sales overall are likewise expected to be dismal both for the domestics and their foreign competitors.
quote: Way to take it way too far, you fail at logic 101. The guy has an enormous truck to support a couple of recreational activities. There is no need to explain any further.
quote: An enormous percentage of these humongous truck owners barely need them. Most of the time they drive around with empty truck beds and zero passengers in a truck that 15 years ago would have qualified for a monster truck rally.
quote: If a small-medium size truck (by today's standard) was good enough to haul a snowmobile 15 years ago, why does someone now need a truck that can't fit in most residential underground parking garages.
quote: As noted, my Dodge truck gets about the same mileage as our 6-cylinder Trailblazer. So it makes essentially no difference which one gets driven.
quote: What makes more environmental sense...using one truck to haul one trailer with six snowmobiles on it, or six trucks to haul one sled each? Oh wait...forgot who I was talking to. It's better to use one truck. And the reason they don't fit in old garages has to do with the simple fact that over the years manufacturers kept increasing the travel in the suspension to give a better ride and allow for greater hauling capacity...nothing more. You know...so a single truck can haul six sleds at once.
quote: WTF is there a need for 2 large vehicles?
quote: > "My point is simple and totally logical and capitalistic: do not live beyond your means"I imagine the average buyer of an Escalade or Hummer can more easily afford his purchase than the average owner of an Aveo or a Kia Rio
quote: By that same logic, we should sell our cars and buy scooters....
quote: Which ensures that many people will be content working their entire lives there, and never aspire to anything greater. This is a good thing?
quote: I drive a Ford Sport Trac ( I don't need a full size). It gives us the room WE NEED. I hunt. Sorry but a deer and gear is a no-go in a Prius. I do home remodeling - I need to tote materials around. Yeah, the big stuff gets delivered, but my time too valuable to have to wait for the truck to show up.
quote: Sportscar? Did I hear sportscar? Talk about something that is absolutely not necessary! Speeding and driving for the fun of it are against the law, in addition to being "unnecessary
quote: The idea that oil is finite, while technically correct, is akin to saying that the sun's radiation energy is finite.
quote: Why not a two-seater...or better yet, a small motorcycle? ....
quote: An H2 driven 5,000 miles (about my annual mileage when I had one) generates less pollution than a Civic driven 25,000 mile
quote: Luckily, we still live in a nation where freedom exists to choose our own vehicles
quote: Ya know how dumb that sounds? Obviously you/someone needed to drive 25K miles. So what if you didn't have the civic?
quote: I don't really care much if you or anyone else has to have a $80K H2 truck to feel like a man...If I had the money, I'd like to own a Ferrari.
quote: 20MPG on your Civic? Something is wrong with your car
quote: ut, like a very large number of Americans, I *need* a truck
quote: it would really be nice if the rest of the world would stop pretending like it makes perfect sense for everyone to get rid of their large vehicles and drive electric boxes with wheels.
quote: Soccer moms etc. need the bigger SUVs and such...especially if you're a hockey mom driving in crappy weather
quote: Yes you might only see an SUV with 1-2 people in it when you're driving around. But on the weekend that person might have 5-6 people in it. Cramming 3 kids into the back seat of a Camry is a good recipe for road rage as the parents get pissed off at the kids fighting with each other. A smaller SUV (yes they're car based) is fine for these families.
quote: People in Europe and Japan typically don't have the large families that people in the US do either.
quote: ramming 3 kids into the back seat of a Camry is a good recipe for road rage
quote: I love it how you make the generalization that all American's weigh 300 pounds.
quote: No American actually "NEED" a sportscar
quote: I *need* a truck (pending wholesale lifestyle change). I race motorcycles...need to pull a big trailer and carry along a few buddies. That means a big pickup truck. My wife breeds, trains, and shows horses - which means we need to pull a big horse trailer, and be able to run and get large amounts of hay and feed in the truck too. We can't be without a truck - and a great many Americans are in the same boat (er, truck).
quote: Soccer moms etc. need the bigger SUVs and such...especially if you're a hockey mom driving in crappy weather where you need 4 wheel drive.
quote: So while I understand how my urban apartment-dwelling friends who have no need for anything other than a Cooper Mini can get by just fine without a large vehicle, it would really be nice if the rest of the world would stop pretending like it makes perfect sense for everyone to get rid of their large vehicles and drive electric boxes with wheels.
quote: Decline in hybrid and small car sales bad news for foreign, domestic automakers alike
quote: Did anybody ever consider that the average Joe does expect gas prices to return to higher levels sooner or later but despite that sees firesale prices on trucks and SUV's that they like more than smaller cars and that the net present value of higher expected fuel prices outweighs the current large savings on such vehicles? I've considered buying a used truck for months; the thousands of dollars saved outweighs a hell of a lot of the extra fuel that would be consumed spread out over the many years I'd own it, again using net present value, which everybody calculates subconsciously when weighing large purchases but I being a nerd actually do with a calculator..
quote: But of course nobody so far has considered that, because liberals only see what they want to see: American's are stupid, SUV's are stupid, and anybody that would buy a truck who doesn't haul a dozen horses between ranches 7 days a week is stupid. Therefore, even though the trucks are cheap right now, the buyers are stupid because, damnit, Al Gore said so.
quote: As for short term vs. long term solutions, obviously new technology is key for the long term. Thank you, King of the Obvious. Unfortunately, the public buy vehicles on a continuous basis. Looking at current sales has no real place in a discussion about long term solutions. As for short term solutions, what is the bailout of the Big Three but a short term solution?
quote: People buy new cars for a reason. Practial people buy what they need.
quote: Simple example EV-1 to come back to the big three. Another example is a by the oil industry heavily patented technique for ICE to be 20 % more fuel economic.
quote: And if i would have to decide over the bailout, i demand government control and a policy for fuel economic cars for the next 50 years.
quote: People buy what they want, subject to a number of factors. To paraphrase Jesus, let he who is without a car and rides city buses from the suburbs cast the first stone! Do we need radios? CD players? Do we need power windows? Do we need power seats, or leather seats, all common and popular options in the US? Of course not. All we "need," at most, is 4 wheels attached to 4 seats. Many people don't even "need" that.
quote: That you bother to bring up the EV-1 FUD/lies/propaganda greatly diminishes my desire to seriously debate you, because those aren't serious topics anyone outside of paranoid left-wing groups even talk about.
quote: And then you bring up "greed," and go on and on without making any legitimate economic arguments, citing any fundamental economic theories, etc... That all might get your left-wing buddies to nod their head in unthinking agreement, but it's not even worth responding to here. There's no argument even being made, just projection of emotion, fear, paranoia and ignorance of how business works and ideas can propagate.
quote: Just for example, the whole patent protection is bunk. Ask any pharma company how well their patents hold up in the real world of Africa and parts of Asia, for example.
quote: If locals can figure out how to make something, and they're poor, then they make it anyway, the government often supports them, and the rich world often doesn't get too upset because they are poor. I don't hear of any electric cars or a hyper-efficient cars rolling around in Kenya.
quote: Ah. At least ideological honesty. I too would prefer if the Democrats were just honest and cut to the chase instead of these half-hearted solutions. Either let them fail, or force them together and nationalize them, renaming them the Obama-Pelosi-UAW Motor Company of the United States. :P
quote: And i see your Pavlov programmed hate once more : Democrats(left) > Obama(democrat president) > Kenya (Father of Obama).
quote: Long term solution is going electric. New infrastructure, new cars, New technologies for an improved electric grid. New technologies for electric cars.
quote: Who in this thread can make a solid business case for making one of these "dream" core infrastructure changes? That is, without pissing away a trillion dollars of taxpayer money?
quote: Look folks, if consumers wanted to pay for it, businesses would provide it, right away. But the reality is that people are not willing to pay for the kinds of changes you simpletons dream about.
quote: And that negative additude will get you nowhere.
quote: All you people do is complain.
quote: Its called realism. Not negativity.
quote: You have literally wrote thousands of words bitching about the car purchases in a country thats not even your own. And WE'RE complaining ? William give it up, get a life, and learn how to spell AMERICA before you decide to preach to us. Pompous ass.
quote: Your negativity is very real.
quote: As is your lack of intelligence.
quote: I would like to see you come up with some constructive idea's.
quote: I see progress anyway and i like to share that what i have learned . Progress not because of you my dear caveman...
quote: I believe in the good and noble principles my country was built on. Freedom, personal liberties, responsibility, the power to make yourself better and follow your dreams. Compared to the contrast of your arguments, I don't see how thats being negative.
quote: This is why I called you pompous. Everyone who doesn't agree with you, you belittle and call them less intelligent than you. There is really NOTHING so amazingly intelligent about what you are saying.
quote: Where the hell are YOURS !? Calling SUV and truck buyers selfish idiots, blaming them for everything, and telling people in another country what they should buy. These are constructive ideas ??
quote: Again, pompous and an egomaniac. Share the progress you have learned huh ? And who, exactly, are you again ? Engaging in class warfare, finger pointing, and flat out lying to back your position isn't progressive thinking, positive, and constructive. And that is the only thing you are doing here. Its Daily Tech, not a government blog. Do yourself, and us, a favor and stop trying to save the world.
quote: but i've heard alot about the american powerlines grid (DT has discussed it as well) that can barely handle the extra *solar/wind power* that's beeing generated right now, let alone a few full blown nuclear plants
quote: and if electric cars ever caught on in a big way, we'd be overloading generating capacity and the grid itself in fairly short order, even if most people did nothing but charge at night.
quote: Meanwhile, people will be left with their gas-guzzling SUVs and trucks they bought when gas was cheap, only to get screwed once again when the prices come back up. Purchasing fuel-inefficient vehicles at this time is shortsighted.
quote: $4 a gallon still takes a hefty bite out of anyone's budget. If on top of that, your vehicle gets crappy gas mileage, then you'll just find yourself back where you started before this recession and shelling out major $$$ for gas all over again.
quote: But the fact of the matter is that most don't need pickups and SUV's.
quote: but who's more stupid i wonder, people because they jump back to gas guzzlers or the companies that started reducing the production of SUV's thinking that the sheep wouldn't return to SUV's once the price of gas would fall
quote: the problem with alot of SUV owners is that they mistakenly think that 4WD makes them immune to slipping/sliding.
quote: They also think it helps with braking/stopping.
quote: When will you guys learn. Not to be mean or anything, but I find it stupid how you guys think SUVs are safer when in fact they could be more dangerous. They're more prone to rollovers, consume a lot of fuel, are big and heavy, and pose a threat to pedestrians. Fuel prices won't stay at this level for a long time. I think they'd go back up to what it was over the summer in around a year or two.