Truck Wars Continue to Heat Up

Pickup lots II

Look for the competition among truckmakers to become even more vicious as each fights to build its market share. According to Automotive News, full-size truck dealerships are getting aggressive with incentive money to make their trucks as attractive as possible to value shoppers. To the casual observer it can seem like the truckmaker that puts the most money on the hood wins, but strategy is very important here.

Ram, Ford and GM are trying not to fall into the same traps of the recent past when incentive wars cut deeply into corporate health and exposed two simple truths. First, propping up total sales numbers and strong market-share numbers with big incentives is not a sustainable model. Second, you need to have a well-stocked pipeline of various products to execute a healthy long-term plan. The new economic reality means the new truck buyer is more sensitive to the struggling economy and likely is more willing to trade off brand loyalty for a great deal on his or her next pickup purchase. And that means both truckmakers and truck dealerships may have to do things differently to win over a smarter, more savvy truck buyer.

All the truckmakers are positioning themselves to take advantage of the new reality, but some, like GM, may have to be more careful than others — especially with pricing. With big incentives on the hoods of the Chevrolet Silverado and GMC Sierra, and a pair of new, smaller trucks on the way, pricing issues will be even more complicated and important for GM's success than the others. We'll have to see what happens.

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Comments

GM raises the price last year, a steep amount, then to compete, they take the most off of MSRP, lol, great resale! Or not!

I don't get why they didn't do the bumpers on that Mossy Oak Ram in body color? Chrome and camo doesn't mix as well.

Tom, the camo on the rockers of the Mossy Oak Edition truck are optional through Mopar as a dealer installed accessory. The only camo on the exterior of the truck from the factory is on the bed caps. Personally, I'd rather have the chrome than painted painted bumpers so I don't need to constantly worry about touching up rock chips before they rust during Michigan winters.

There is no relationship between the cost of a modern vehicle and the cost of the labor to produce it.

As the percentage of trucks produced outside of America has increased. The price of the vehicles have continued to grow tremendously. Even while labor costs have been negotiated down at the big three.

Even the price of commodities had reduced for many years and only just now started a rebound.

I suggest there is another reason for the increases. That is the subcontracting of labor to smaller companies to avoid labor unions. What this has accomplished is to increase costs due to the scavenging of profits at the multitude of levels of management in the automotive manufacturing process of today.

Instead of one huge corporate power taking a twenty percent profit. We now have thousands of smaller subcontractors all taking their 20 percent profit. When the price of a screw increases and the percentage of profit doesn't change. Then the price increases exponentially at every level of the manufacturing process.

In addition we have stagnant wages because the small subcontract shops do not offer the ability for their workers to organize.

Increasing prices in order that a set profit can be made from an ever dwindling customer base is a losing proposition.

The manufacturer's will have to absorb back their entire manufacturing process if they wish to be profitable.

They have to understand that a customer base that only includes happy stockholders, is a failing proposition.

I tried to build the cheapest Ram 1500 diesel that I could. It came in a bit above 40,500. And I couldn't get it with a stick. Even Dodge is giving up on the manual it seems.

It seems that our CEO's have come to the conclusion that if they can't make more than a dollar PROFIT/vehicle. They may as well shut the doors.

It's all apart of the affliction called GREED. There is a mind set taking hold of in America that believes there is no value in a small profit. They believe just because you hang a, 'open' sign on their front door. That they are entitled to be a millionaire.

We built this country on the belief that strengthening our nation would be the greatest thing for all people..

It seems as if today we have changed to a nation struggling to be king of the dump.

From Ford Corporate website:

The $5-a-day Workday

After the success of the moving assembly line, Henry Ford had another transformative idea: in January 1914, he startled the world by announcing that Ford Motor Company would pay $5 a day to its workers. The pay increase would also be accompanied by a shorter workday (from nine to eight hours). While this rate didn't automatically apply to every worker, it more than doubled the average autoworker's wage.

While Henry's primary objective was to reduce worker attrition—labor turnover from monotonous assembly line work was high—newspapers from all over the world reported the story as an extraordinary gesture of goodwill.

Thousands of Workers Flock to Detroit

After Ford’s announcement, thousands of prospective workers showed up at the Ford Motor Company employment office. People surged toward Detroit from the American South and the nations of Europe. As expected, employee turnover diminished. And, by creating an eight-hour day, Ford could run three shifts instead of two, increasing productivity.

Henry Ford had reasoned that since it was now possible to build inexpensive cars in volume, more of them could be sold if employees could afford to buy them. The $5 day helped better the lot of all American workers and contributed to the emergence of the American middle class. In the process, Henry Ford had changed manufacturing forever.

They could have gotten a V6 off the lot somewhere but they would have had to buy it. Renting - probably would be hard to find a 2014 and it probably would be a base RC if they could find it. Not worth the time.

Toyota didn't provide a Tundra either.

Ford is under no obligation to make the old trucks available for testing when they have the new trucks coming out. And quite frankly I wouldn't expect them to.

Remember GM didn't provide any trucks for the 4x4 shootout.

These attacks on Mike Levine are stupid spam and need to stop.

@buddylam, that was during a time when there was less govt control of so many aspects of industry and society and common sense and a good sense of right from wrong still prevailed. not so much anymore. ANytime govt gets involved in an industry the costs just go up for us sheep. lets send them a message and dont over pay for this new junk and or buy used and let the other guy take the depreciation hit

it sure would be nice to buy a vehicle with no govt mandated junk on it just to see what it would weigh and how it would perform. my truck probably has 12+ airbags etc. would probably weigh 400lbs less minus the airbags and all electronics that go with it. Think how good it would run not all choked down with 4 cats etc. could probably get by with half the engine displacement and have almost same performance and much better fuel economy.

People are beginning to realize that the full-sized trucks are simply TOO BIG! As such, with some slightly smaller trucks on the horizon, I'm thinking we're going to see a draw-down of inventory in the near-term while trucks currently taking the "mid-size" slot will become the new full size. Meanwhile, news is pretty much reporting that the current line of full-sizers is going to face even stricter economy rules in the near future--perhaps even superseding existing CAFÉ plans for 2025.

Meanwhile, I went to the Philly Auto Show this past weekend and confirmed many of my guesses about the size of certain trucks. I'm sure most of you already know my opinions, but feel free to comment. As long as you don't go all slogan-y on me, I'll probably leave your comments online.

The average US household earns just over $50,000 per year.
Assuming they have a mortgage or pay rent, can someone tell me how the average household can afford a $30K, $40K, much less a $50K truck? The math doesn't work. Are 10 year auto loans the future? If so, the future of the US economy is dead.
http://www.today.com/money/many-credit-card-debt-outweighs-savings-2D12115234
America, you should be ashamed of yourself. We have become a country of financial losers. When are we as a country going to stop spending more than we bring in?
As for my family and I, we refuse to participate.

@buddyIam

Every business is in the business of making money, and they would he out of business if they didn't make a profit. Making a profit shouldn't be labeled as evil or against the command man.

Also, it is not just the wages that are increasing vehicles, it is high cost pension plans as well. That is what caused GM and Chrysler to go bankrupt along with the fact that auto workers still make considerably more than the national average wage. Also, factor in the parts and materials cost more due to them having to pay their people more as well. Increasing wages and pensions is a snow ball effect that only screws the end user. As I said, businesses are in business to make money. If a cost go up then so do what they charge for their product which the end user pays. If not, they they go out of business.

There are some pretty ridiculous comments on this site from time to time, but Buddy nailed it today

1. NO RELATIONSHIP between labor cost and vehicle price--that's a doozy Buddy!

2. Commodity prices have not gone up--since when, Buddy?

Commodity prices have gone through the roof in my lifetime. Where do you live, dude?

Cmom,

You wouldn't want a 'family' vehicle without todays safety features.

And without the smog controls Disneyland in LA would have closed down decades ago. By the mid sixties LA was a pea soup. Burning red eyes. Air that smelled worse than exhaust from a tailpipe in todays cars.

Even the San Joaquin valley had a great many pea soup smog days by the mid 60's. That valley is the center of a great deal of America's farm production. Without smog controls farming in the valley would have gone to ruin.

Other than the converters. Most smog control today, is a part of the manufacturing process and computer controls. Not added equipment. And the price of producing computers, electronics and converters have gone down as of late. Not up.

And a great deal of the added computer controls are not smog related. But rather cruise control, Zone heating and the like.

On my 1980 400m, the smog control was an air pump, about ten feet of vacuum hose a bunch of fittings and sensors and a converter. Not a great deal of expensive parts, but much more labor intensive than modern engine building today. The cost of labor in relation to the price of the vehicles today has gone down a great amount. Yet price's are up 700 percent.

I am just amazed when I watch a computer bolt on heads, manifolds or wheels etc. all at one time. And all at the proper torque.

The types of increases we face today, can not be justified when it is obvious that those increases will lead to a dwindling customer base.

The base trucks today can be had in the low to mid twenties. They include all the mandated safety and smog equipment.
The problems begin when you ask for a specific piece of equipment.

For instance the Ram 1500 diesel can not be added as a single option. It must be added along with a package of a great many unwanted items.

If I were allowed to pick just the diesel as an option. I could get a vehicle for well under 30 grand. But that sort of thing is not allowed. So I must pay 40 grand for the diesel.

It will be very difficult for any to convince me that price increases haven't been the result of profit taking at the multitude of manufacturing steps purposely inserted into the process of making modern cars.

Granted there are things like multiple coils that have been used on todays engines. But they not only cleaned up the air. they have produced extraordinary power. The buyer would be begging for those items even absent smog regulations.

Would you rather have a 65 corvette with a dual 4 barrel 427. Or one of the modern top of the line corvettes?

Todays Corvettes will run circles around that dual four barrel and get near 30 mpg when you want it.

I am all for progress. And am willing to pay for it.

This is what busts my butt:

There is no government mandate that requires I load up my truck with leather seats, multi CD player, power windows, auto transmission and heated seats. Just so I can get a diesel engine.

Channel stuffing (the 80's practice of selling cars to yourself, then parking them in vacant fields) is at ALL TIME HIGH.

Of course they're going to slice's each other's throats for market share...

http://www.zerohedge.com/news/2014-02-12/channel-stuffed-us-car-dealers-cut-prices-hope-sell-their-way-out

Papa Jim

Commodity prices have gone up in our life time. But not in the last 3 to 4 years.

In fact the failure of such commodities as copper to increase in price in relationship to the rise in stock prices. Has many stock people wondering how long until the stock market fails again.

Natural gas has sunk in the past decade. Crude is down 50 dollars since it's peak.

Demand for all of these commodities indicate the rate of economic growth.

Ford made a calculated decision when it decided to use more aluminum in it's pickup. They decided that they could purchase aluminum as a replacement for steel and still make a profit without losing their customer base.

Aluminum is down 16.42 percent over the last year.

The same applies to pretty much all of the building material commodities.

You have to also adjust the commodities price for inflation.

Here is a list;

http://www.indexmundi.com/commodities/

Remove unions and wages drop across the board. Same job in non union pays less in wages, health care and retirement.
Less wages means less tax revenue whether state or local.
Only people against unions are the tea party fanatics or republicans.
The price of the goods won't drop because a union company goes non union. That company just makes more profit. Even when union wages drop that company as a norm doesn't lower it's prices.
Greed, greed, greed.

Public companies are run by share holders. Shareholders care about stock prices and dividends, not long term viability or healthy business practices. The modern corporation sees employees as liabilities, not assets. Remember that.

Truck buyers are the victims of their own stupidity. latest and greatest always trumps pragmatism, 400 hp is great until the next truck has 450, then 400 is crap. Leather seats, heated steering wheels, chrome this, platinum that, wait - is that a higher trim level? My neighbor won't be impressed if I park the 2nd most expensive truck in my driveway. Okay, give me the $70K truck, oh and then I'm going to drive it over to the tire shop for $5k in bling-y wheels and tires because my neighbor won't be impressed if I have the regular $70k truck wheels on my truck. Damn.

Keep it up America. Every time I see a pimped out $70K truck with all of the bells and whistles, and the aftermarket this and that, I don't see successful, I see stupid. Oh and by the way, 8 years from now, when your $70k truck is now worth $5k, I'll be the guy buying it while you're at the dealership rolling the 4 years of payments you had left into that new $75k truck. Like they say in the movies, if you look around the table and can't tell who is the sucker...

MadMaxx

Accounting rules have their own set of grey areas of the law.

To a person searching to make a stock investment.

Sold, should mean the product was delivered to the end buyer. Not a middleman.

^^ Unions once had a place in the US. From the mid-1800's - the Industrial Revolution, uneducated blue collar workers were not treated well. Working conditions were abysmal and media could not easily make the general public aware of what was happening. Today, in small part due to unions but in large part due to social media, it's a different environment for 99% of all workers. If your being mistreated tell someone.
Today, unions just screw up free-market capitalism. If you don't like your job quit. If you aren't being paid well enough, quit, get more education and find a higher paying job. Unions are dinosaurs. Their time has passed.

Now that I have beaten up on unions, let me talk about corporate greed in the automotive industry. Ford and GM make ~ $10,000 - $15,000 in profit on every light truck they sell. That is crazy profit margin, roughly 30%. Most fortune 500 company's have profit margin of 15% or less. Now, we all know that Ford and GM truck profits subsidize less profitable models. Still, they are screwing truck buyers. It's Robin Hood or OBama's rich vs poor war. Steal from the rich and give it to the poor.

"Greed, greed, greed"

LOL! Any company that makes a profit or anyone that works harder/smarter to get ahead is greedy. Typical union propaganda BS. Call everyone else greedy while the union itself is a company with their president making over a $150K a year not including other benefits and bonuses. So glad I live in a right to work state where I have a choice NOT to join some hypocritical union. If I want a raise, I do more or learn more to increase my earning power. If a company doesn't pay me what I think my knowledge and work ethic is worth the I will find one that does which is not hard to do when you have a work ethic and the knowledge in my field like i do. I don't sit there and ask for more money to do the same work. I ask more to do more work and my raise becomes effective when I do.

@Buddlam and papajim,
If you look at how commodity prices have climb over the past decade or so you'll find most have more than tripled. This is why Australia and Canada are in the position they are in now.

Between the 60s and early 2000s commodity price increase was below it's historic average.

The US also back in those days represented a disproportionate part of the global economy (because of WWII) and was able to manipulate commodity prices. It's not in that position now and the Chinese and others influence commodity prices.

As for Ford and the $5 a day wage. The US back then also in the motor vehicle industry didn't have the external challenges (because of WWI) it has now. Ford was the first to make massive improvements to vehicle production by adopting mass production techniques.

Invention or creation of an idea like mass production doesn't mean you'll always lead. You have to build on that lead.

The US back 100 years ago or so was in a similar position to the Chinese are now, that is the globes factory. Things have changed and the US manufacturers, economy and population became cozy. They figured they will always lead.

America realises that to lead it must change and change will be coming, faster change is required to keep pace with the 'new world'.

The US is in a much more competitive environment and needs to be more flexible to compete with imports.

Banning imports does nothing to help the nation other than continue on with uncompetitive industry.

If your trucks are going up in price, means maybe the manufacturers aren't making enough profit. The US manufacturers, UAW, government has placed the US auto industry in a poor position where it's reliant on pickup sales to survive. You guys will now see why I argue the debate I do about protectionism is bad for any industry.

So, living standards in the US will adjust to meet this new world and this includes price hikes in some products, like pickups. Detroit can't afford to go broke again.

@buddylam: you really can't figure out how to get a Ram 1500 diesel for less then 40k, or you want to lead people to believe they can't?

It's easy, build a Tradesman 4x2 8 foot bed, select 3.0 turbo diesel, boom, just shy of 29k.

No leather, no bunch of unwanted options. You can chose cloth or vinl seats.

No power windows, power locks, unless you want them. Then you pick the power group.

Yes, you have to get an automatic, as manual transmissions have been gone on 1500/150s/ half tons for 7 or 8 years.

You get an eight speed, miles ahead of some clunky __ 6 speed transmission. Atleast Ram offers a manual heavy duty. Toyota and Nissan midsizers have manuals.

I'm with you there, it would be nice to have a manual option. A 7 speed would rock. The take rate isn't so high on manual transmissions, with people always wanting to hold coffee or a phone in their hand, or they didn't even learn how to drive a stick shift, as most dont nowadays.

Luckily, my brother had a 3 on the tree slant 6 Dart, so I learned.

Did you seriously even try to build a truck on Ram's site, or you just said what you thought sounded cool?

@Buddy
Please bear with me: You're talking about a 12 month timeline--I'm talking about decades.

Since 1971, the US dollar has plunged versus commodities. President Nixon and the US Dept of Treasury took the dollar "off gold." Till that time a dollar could be expected to maintain its value--and it did. It was the most envied currency on earth!

When the dollar was taken off gold, oil went through the roof. Groceries, rents, home prices, metals, all went straight up.

With the exception of the 1980s, and the 90s, the dollar has been in a free fall. American workers are the first in line to be screwed every time there's a new increase in the money supply--because it takes more dollars to pay the rent, buy lunch or send your kids to the doctor.

Union membership has crashed during this period. Despite putting our wives to work bringing home the bacon, US standard of living for middle class families has been weak compared to leading industrial countries.

All of this traces back to the 1971 decision to let the dollar float.

Commodities have little to do with truck prices in today's world.
It's labor, overhead, health insurance, pensions, and profit margins that account for the VAST majority of automotive costs today.

All1

How does a 150k salary compare to a many million dollar salary for running a business into bankruptcy.

For all those who talk down on unions. Remember that it was a very small majority of workers that turned down the union at the VW plant. And it was a Union agreement that the company supported.

It was defeated because of the input by the Koch Brothers and a few anti union organizations running scare tactic ads.

When someone comes into town trying to tell me how to run my life, like the Koch brothers do. I immediately know to work to get them out of down.

I am not trying to say the workers agreements at the union automotive plants are bad.

When compared to their locale economy. The automotive industry all provide an equal benefits package.

What fails is the wages and benefits at the sub contractor sites. And that applies to both the union and non union manufacturer's.

To go out and buy a new house and truck today you are talking about 3 grand in payments. That's way out of the purchasing power of a median household income.

If a couple wants to buy a home. They have to delay or forget about buying that new truck.

On the median income, a single person can't afford to buy either,

@papa jim
Australia floated it's currency back in 1981. The problem with not having a floating currency was it's value had to be maintained.

There are limited instruments to manipulate currency valuation on a fixed currency.

Interest rates and borrowings are the two main methods to maintain currency value. What occurs here is when trying to maintain currency value makes it awkward to manage inflationary pressures.

Floating a currency is the best option in managing a currency.

1971 was also about the time the Europeans and Japanese had rebuilt their economies and were able to stand on their own two feet.

The US's current position isn't bad, it's just people have to live within their means. The US has been living beyond it's means like the rest of the OECD economies.

I just isn't viable to go on as we had.

Prices will rise in the US, housing/food will always be affordable, but cars don't have to be as their are cheaper options to drive.

As housing and food prices outstrip income, the makeup of vehicles in the US will again change.

Like I said most pickups are a middle class status symbol. They aren't an entitlement, they are earnt.

This has nothing to do with greed, it reality.

@papa jim
Australia floated it's currency back in 1981. The problem with not having a floating currency was it's value had to be maintained.

There are limited instruments to manipulate currency valuation on a fixed currency.

Interest rates and borrowings are the two main methods to maintain currency value. What occurs here is when trying to maintain currency value makes it awkward to manage inflationary pressures.

Floating a currency is the best option in managing a currency.

1971 was also about the time the Europeans and Japanese had rebuilt their economies and were able to stand on their own two feet.

The US's current position isn't bad, it's just people have to live within their means. The US has been living beyond it's means like the rest of the OECD economies.

I just isn't viable to go on as we had.

Prices will rise in the US, housing/food will always be affordable, but cars don't have to be as their are cheaper options to drive.

As housing and food prices outstrip income, the makeup of vehicles in the US will again change.

Like I said most pickups are a middle class status symbol. They aren't an entitlement, they are earnt.

This has nothing to do with greed, it reality.

@Buddy

The union lost the VW vote fair/square. They advertized, they organized they were even allowed on the property to sell their viewpoint and it did not work.

Out of a workforce of about 1000 people they lost by almost 100 votes. Their message did not sell.

Don't blame others. They lost. Industrial workers in the south have for along time been suspicious of big labor.

The UAW has some big work to do if they want to organize these southern shops. Bellyaching about the Koch brothers is BS.

^ Because very, very, very few line workers or any other blue collar worker deserves to make $150,000 /yr. The free market does not support that kind of salary for any assembly worker. Only physicians, entrepreneurs, attorneys, engineers, software writers, dentists, orthodontists, CPA's, and a few other business professionals can earn that kind of salary.
The only blue collar job that I can immediately say deserves that kind of money are high iron workers building skyscrapers and bridges and they only reason for that is they are risking their lives AND physically it can't be done by 50+ year olds.

@Big Al

With all due respect, Al, please stick to what you know.

Paper money is nothing more than a medium of exchange. Adding or subtracting paper money from the mix is full of opportunities for mischief. And how!

If you and your friends knew with 48 hours lead time about the central bank (Fed) announcements each month you could be a billionaire. This is the big conflict of interest.

Do you really think that Goldman Sachs and BoA don't know beforehand how the Fed managers will vote each month? Somebody clues them in!

Look at Goldman Sach's share price (adjusted) since 2008. Smelling like a rose.

this week in London the brokers who fooled around with the LIBOR are getting ready to go to jail. It stinks to high heaven.

The union argument is like the minimum wage argument.
Why not just make the minimum wage in the US $100,000 per year. Why not make it $150,000? If you do that inflation will skyrocket. All other salaries will adjust upwards along with the price of everything. A $5 hamburger will cost $50. A $150,000 home will cost $1.5 Million. Eventually the poor guy making the $150,000/yr minimum wage will be just as poor as someone making $7.50/hr minimum wage today. These are the laws of economics. They can't be stopped, even Fascists, Marxists, Socialists, and Communists can't defeat the laws of economics...no matter how hard they try.

@buddylam
You talk of benefits and packages.

Who pays for this stuff? The government? The consumer?

Or, the general population of a country.

This is where the UAW has to come to it's senses. The UAW couldn't provide a service for the fee it expects out of paychecks.

The worker doesn't deem the UAW and attractive option.

Organised labour has become unattractive. Because you don't get value for money.

Organised labour spent thousands of dollars per worker at Chattanooga and for what return?

Organised labour needs to reform and reflect what current worker want.

Orgainsed labour provide a product along the lines of selling insurance.

Would you buy an insurance policy from a company that will cost you?

So, organised labour in the US is showing it isn't a viable or attractive package, as the consumer feel they will be worse off and is a poor investment.

Would you buy a pickup that continually breaks down?

@nlp
Contrary to my beliefs I do believe a minimum wage that is liveable would be a great outcome.

I will not increase the cost of living as most assume. Because there will be adjustments in the rest of the economy and financial system to allow for this.

Like you healthcare in the US there is much misinformation regarding these two ideas.

The value of the minimum wage has decreased in the US since 1969. The US minimum wage back then had a value of approximately $10.50 in 2103 dollars.

The scare mongering going on in the US over this minimum wage over Christmas when I was there was quite inaccurate.

In Australia our minimum was is about $17-18 per hour and a Big Mac is only 70c more. So an increase to $12 per hour in the US would increase the cost of a Big Mac by 25c.

Yes the price of goods and services will rise. But also so will all wages. But wages will go up proportionately. This means a person on $25 per hour might go up 50c.

What will also occur is the value of your dollar will fall against other currencies.

So the US will not be in position that is more uncompetitive than it is now.

"...In Australia our minimum was is about $17-18 per hour and a Big Mac is only 70c more. So an increase to $12 per hour in the US would increase the cost of a Big Mac by 25c."

@Big Al,

that is the worst and most simplistic analysis of a complex fiscal matter I've seen in my entire 63 years. Jeez, I'm glad they didn't install you at the Dept of the Treasury.

We already have horrendous unemployment in the US. We have a blue collar workforce that is behind the rest of the industrial world.

Our schools are busy pumping idiots into the economy every May/June.

Then they all stand around and give speeches about how smart they are; then they head down to collect their food stamps and disability because they cannot contribute to the nation's economy without borrowing even more money and going back to school.

So, to this mix you propose paying them more to be useless clock punchers.

Please dear God help me!

On the topic of trucks becoming TOO BIG, manufacturers’ have given us the option of smaller boxes or smaller crew cabs for making truck’s easier to park daily drivers. But it would be great to not have to make the tradeoff between box and crew cab size anymore in the ½ ton in order to get them to fit in very standard 235.1 inch long garages (not 240 inch as some may believe). V6’s have proven capable for ½ tons and can revolutionize the whole ½ ton truck segment if the front end of a ½ ton were shortened as can be done when using V6’s. This really matters because currently with 6.33-6.5 foot box and 40 inch legroom crew cab, RAM 1500, Silverado 1500, F150 lengths are too long at 237.9”, 239.6”, 243.9” respectively. This link shows how easy the front end reduction can be http://news.yahoo.com/blogs/motoramic/why-2013-ram-1500-v6-mechanic-best-friend-154301790.html The new midsize trucks are trying to address being easier to park, but again are just giving us more of the small box, small crew cab scenario, whereas the entire mid size market can be addressed with a minor front end re-design on the ½ ton V6. Accommodating inline 4’s or V8’s into engine compartments does not help with front end reduction for making trucks easier to park because of the extra cylinder. Silverado misleading ad says a 6.5 foot box, 40.9” rear legroom crew fits in a garage http://media.gm.com/media/us/en/chevrolet/news.html/content/Pages/news/us/en/2012/Dec/1213-2014-silverado.html (scroll to section showing their corner step bumper). This is definitely untrue when taking into account a rollup door’s protruding U-shaped sheet metal horizontal support. Maybe the answer is a front end option with different front fenders, bumper, and hood specific for a V6 engine. This option would surely be easier than making an entire new mid size truck. Tesla won’t have to worry about accommodating V8’s and I4’s on their future truck designs.

@NLP

Good points.

Here's a good point: Don't buy NEW. Buy a year old Certified Pre Owned truck.

You will save at bare minimum 10k or more. Same great truck and warranty with none of the downsides you mentioned in your post.

People are complaining about the price of pickups but even if there were zero upgrades to trucks inflationary pressures would increase prices.
Trucks have gotten more complex due to "ethical" considerations. That would be compliance with safety and emission laws.
We can argue the need for safety devices just like bikers and their "freedom of choice" but on the flip side, who's responsibility is it to absorb the extra cost of caring for someone with a functioning brain stem and zero higher function?
Environmental rules are another hot topic. One can argue "global warming" or the replacement term "climate change" but there are also various intermediate and long term health risks associated with uncurtailed emissions.

The USA and most developed nations have temporarily dodged the decrease in standards of living by offshoring inflation (i.e. shipping manufacturing jobs to Mexico, China etc.) or currency manipulation. Another method was/is subprime loans, long duration loans, and corporate and government incentives.
These techniques do not work in the intermediate or long term as someone has to pay off debt.

Costs will rise and those that bemoan the inability or looming inability to purchase a 40K truck need to realize that it is inevitable. At least 50% of pickups are personal use. That is "lifestyle". Needing a truck to pull a camper or tow toys is not a need.

1-If I cannot afford a new pickup, i will not buy a new one.

2-If I were to need a 100 month loan or subprime loan to buy one, I will not buy one.

3-If car companies are going to discount their products by 10K to encourage a purchase, I'd be stupid not to consider it (as long as I don't require points 1 and 2)

People are complaining about offshored jobs, parasitic unions or not enough unions, costs of pickups, too much big government or not enough big government..... ad nauseum.

Things are not going well dispite all of the rosie reports from media. It won't be long and the middle class will be part of the working poor and even 30K pickups will be out of reach.

Key indicators like education, infant mortality, wage and wealth disparity all indicate that the USA is on par with many if not most 3rd world nations.

Might as well go out and buy more mind numbing Apple or Microsoft products and remain self absorbed or intellectually stunned by mass media.
Lets all go out and buy multiple firearms as the Koch brothers already can afford their own armies and the day may come where we will need all the weapons we can muster to protect ourselves from ourselves.

Lou BC

Good post

The manufacturers need to cut their production. Why flood the market with high priced trucks and then discount them heavily. At a certain point it does not matter how much money they put on the hood, they will still have excess unsold inventory. Better to adjust the inventory to the decrease in demand and make more money on each unit. This is what got Detroit in trouble before and also being too dependent on a single product. Cut production first before steep discounting.

LOL! A Koch Brother rip!
Oh Lou, you really had some good points till you showed your yellow back, now it's just worthless whining.
Good luck loser, hope you find enough people to blame your faults onto.

PaPa jim

Go to North Dakota. What Big Al describes is exactly what is happening there.

15 dollar/hour at McDonalds etc. 17 dollars /hour starting pay for a WalMart cashier, Yet the product prices are the same as anywhere else in America.

There is some rent gouging. But that is only because there is a boat load of people living in old wore out campers looking for anyplace to live. That has nothing to do with the minimum wage.

The trouble with most of these trucks is that they are either too expensive and/or they are producing more than the market will buy. Then the manufacturers will have to add low interest financing and lower the qualifications on the loans which lead to those who really can't afford these trucks buying them and then defaulting on the loans. This then leads to another financial meltdown. Maybe the demand for trucks is not as great as it was 10 years ago. The manufacturers are selling more suvs and crossovers of all sizes and that appears to be the fastest growing segment. For a while it seemed that everyone had to have a pickup but that trend seems to be reversing. This is not to say the market for pickups is dying, just that it has peaked and there will be no more significant growth in this segment. Many of those that needed newer pickups have already bought.

Also trucks are no longer inexpensive and will become even more expensive. TTAC has an article about GM buying aluminum contracts for the 2018 Silverado which will have an aluminum body just like the 2015 F-150. Aluminum will raise the price of all these trucks which make them a less affordable option. Also the manufacturers all load these trucks up with expensive options which are nice but how much can the average consumer afford? What is the price point at which buyers will say we just cannot afford a new truck even with a significant discount? There is a difference between wanting something and being able to afford it.

You do realize Buddy that companies in North Dakota are paying those wages because the local economy is booming now thanks to the energy industry. You cannot take your example and unilaterally apply it everywhere.

The market supports cost/yield based on local factors, hence why we have a discipline called microeconomics. What you appear to be arguing here however is the application of micro to macro. Such uniformity requires extensive price/wage/supply controls through centralized economic planning. This has been a failure every time it is attempted.

When applied to the unions, especially the UAW, this is why the union movement no longer is strongly supported here in the United States and unions are in decline. For too long the unions artificially inflated the worth of their labor in relation to the quality of the product they were producing. This, in conjunction with government interference and manipulations, were passed on to the consumer. After a time the consumer tired of paying for what was often an inferior product when placed in comparison to the foreign products. As the saying goes, the rest is history.

So today we see companies such as Toyota, Nissan, etc... offering quality products consistently at less of a cost to the consumers while GM (requiring a tax payer bailout), Dodge (bought out by Fiat) are continuing to struggle with only Ford standing out from the mediocrity offered by the other two domestics. Of course, calling GM, Chrysler/Dodge/Ram, Ford domestic is somewhat disingenuous considering where many of their vehicles are now being produced.

Good day sir.

At the guys afraid of improving minimum wages. Just look at other countries where the minimum wage is higher than the US.

The same can be stated for public health. Don't just use poor examples are there are as many models of public health as there are countries with public health.

It's a fallacy to state that these things will bring down the US economy.

It actually increases spending power within the US and increases the number of higher paying jobs.

The problem in the US is the disparity within the country and the inability of those who fear losing out by making change and restructuring.

@papa jim,
What I stated will not fix the US as the US will require at least 3 decades to restructure like Australia did. And we still are quite far from perfect.

For free enterprise to work it has to operate in an equatable environment. Regulations aren't the problem, it's the regulations end up becoming counter productive. Why? To protect interest groups.

Removing tariffs and subsidisation alone will save the US over 2 trillion dollars a year. These are unnecessary expenses that defeat becoming more productive as a nation.

Many are living in the past and not trying to become the future.

@KMS, that's exactly why free market is the way to solve our economic crisis and increasing minimum wage laws is NOT the answer. Every state should be doing what North Dakota is doing! Our incomes would be high, energy and costs of living would be low!

@Jeff S

Truck/car makers do not need to cut production--there is an excess of auto-making capacity world wide.

Try getting your arms around that: The excess capacity is a cost to consumers; cutting production would actually INCREASE the cost of finished goods because capacity has not changed, and as I noted, un-used capacity is a cost.

It took investment to create the capacity whether they use it or not. The assembly plant and the supply chain systems were built to satisfy a particular level of capacity.

Without the corresponding level of production envisioned by the designers when the plant was being built (or upgraded) the plant will actually cost more per unit of finished goods to operate.

No free lunch. This ain't easy. The Big Three embraced this administration (and the previous one) and now they're stuck with too much capacity. The problem of capacity has been around since the early 1990s but it got really bad in 2008-2010.

@Big Al

Public health systems add "demand" to a system that was already stressed to address demand.

There were 30 million people without health insurance 6 years ago. After four years of attempting to create a European style system here, we now expect to have over 20 million uninsured in 2020.

The addition of many millions of subsidized beneficiaries to the system added huge cost, and did nothing at all to provide additional clinics, doctors or nurses. The members of the American public who already had insurance are now paying much higher premiums and our rulers in Washington have actually exempted themselves from the crummy mess they created for the rest of us.

To top it all off, the added cost to employers for benefit plans reduced the number of job openings. Today's workforce in America is the smallest percentage of the total population since the 1970s.

Every attempt to prime the pump with cheap dollars has failed. Interest rates are near zero and the prospects for economic growth are flat at best.

OMG!!!! I think Mark Williams got the point across about stopping the trolling that was happening here (it seems to have toned down a bit), however, now it seems like the comments for articles have become political discussions. I guess either I have too high expectations for discussions with people here, or there is no hope left for humanity.

@PUTC Moderator
I HIGHLY suggest that in addition to moderating the trolling, there needs to be some type of the same oversight on discussions that don't involve the article. How are we supposed comment about trucks when we have to deal with the kind of comments seen above?

@HEMI MONSTER - the direction this thread has gone is a logical one based on the comments in the lead story.

Re-read the article.

They talk of:

"First, propping up total sales numbers and strong market-share numbers with big incentives is not a sustainable model."

"The new economic reality means the new truck buyer is more sensitive to the struggling economy and likely is more willing to trade off brand loyalty for a great deal on his or her next pickup purchase. "

"All the truckmakers are positioning themselves to take advantage of the new reality, but some, like GM, may have to be more careful than others — especially with pricing."

Those comments talk about new economic realities which are political, they affect the financial, and carry over into the social.

This has been an intelligent series of comments with different view points from different socioeconomic beliefs and principles.

It is fitting and it is a welcome change from the my d!ck er truck is better than your d...truck.

@gomj - interesting comment and do you care to explain why you feel the way you do?
There is a socioeconomic chasm in the USA. The ultra-rich on one side and the rest of us on the other.
We fight each other over trucks, sports, politics etcetera and in doing so are so wrapped up in our own little petty conflicts that we do not see what is happening.

Have you seen Hunger Games?

Do you understand the metaphor that books series represents?

@Lou BC
I don't mind so much discussion about how the economy relates the the automakers or what truck someone chooses, it's all the minimum wage stuff, or in a different article everyone got off on global warming/religion. I guess you're right, though, it could be much worse, so I could be content with the "progress" people are making here.



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