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Big Three automakers see sales plummet

They aren’t making what we want to buy, plain and simple.

U.S. sales fell for all three big American automakers in June, led by a 26 percent drop at General Motors Corp. (GM), while Japan’s Toyota Motor Corp. surged.

Higher gas prices, slower sales of trucks and sport utility vehicles and a lack of deep incentives compared to last summer — when GM rolled out employee-level pricing — hurt the Detroit-based automakers in a weaker U.S. auto market.

… Toyota has taken a bigger share of a weakening U.S. market on the fuel efficiency of its line-up, which trails only Honda Motor Co. in average fuel economy among major manufacturers.

…Toyota has only a 9-day inventory of the Yaris, and an even tighter 4-day sales inventory of its Prius hybrid, essentially making both vehicles sellout hits.

Meanwhile, sales of Ford’s Explorer, a best-selling SUV, dropped by 36 percent in June while sales of the larger Expedition were down 46 percent. “There’s no question that higher gas prices have hurt demand for these products,” said Ford sales analyst George Pipas.

Kate and I have been complaining how Subaru has been behind the curve on hybrids (we have an Outback wagon). It’s an otherwise smart — and gay-friendly — automaker, but it really missed the mark by going for the SUV market with the stupid, fuel-inefficient and ugly Tribeca. Last year we went to see one in the showroom out of curiosity and it was disappointing that they wasted development time on this instead of a hybrid. The automaker was obviously shooting for the upscale family SUV demo already targeted by the Big Three.

Incidentally, Subaru reported its best June sales in company history — even the Tribeca posted double-digit gains –and total sales are up 3 percent for the year so far. More pain for the U.S. car makers. Driving around town I never see any Tribecas on the road (or even the sedans), but I see a ton of new Outback wagons, mini-SUV Foresters and Outback Sports (the 5-door hatchback) out there. And let me tell you, the number of Toyota Prius hybrids sailing around Durham is substantial.

Apparently Subaru is pairing up with Toyota to use its hybrid technology, though nothing is expected until 2008. All Subaru has now is a concept car, the B5-TPH:

I cross-posted this at Pandagon, and a reader pointed to this enlightening article, GM hides fuel-efficient small cars and trucks — in Brazil. It proves how brain-dead GM is — they’ve got fuel-efficient small cars that they will not sell here in the U.S. Big mistake.

Specifically, it is the fault of GM’s North American marketing department and unions, which, for a variety of reasons and through myriad machinations, have kept highly desirable small GM vehicles out of the U.S. market at a time they are very much needed.

The truth, as evidenced by a sampling of GM of Brazil cars and trucks at the company’s Cruz Alta Proving Ground here, is that GM can make small vehicles as well as anyone else. But the company is hampered by a North American marketing belief that American consumers won’t buy those models, and by labor politics that prevents the U.S. entry of those little cars and trucks because they are not assembled by the United Auto Workers union.

For the record, that’s my take. GM officials are loath to be so blunt. They proffer seemingly palatable excuses, such as the high cost of retrofitting their Brazilian models to comply with U.S. safety and emissions rules.

I reject that argument. I refuse to believe that a GM that could make a huge Chevrolet Tahoe sport-utility vehicle meet stringent U.S. safety and air-quality standards can’t do the same thing for the car-based, subcompact Chevrolet Montana pickup truck sold here. It just doesn’t wash.

How will the Big Three address this?

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Pam Spaulding

Pam Spaulding