The slump sales of trucks is hindering General Motors Corp.’s turnaround plan in North America. Just as the auto giant was gaining momentum to recuperate, there was an apparent shift of the market to small and fuel efficient cars. Additionally, gasoline prices were rising. And for a company that depends much on the truck market, such a change in the trend would spell trouble.
GMC was relying on its all-new full-size GMC Sierra and the Chevrolet Silverado pickups to be smash hits. Unfortunately, the pickups are taking longer to sell as compared to their ancestors.
The long-drawn-out slowdown in housing and construction markets in the United States, coupled with the increasing gasoline prices, is weighing on the sales of pickup nationwide. The pickup truck segment is a lucrative market on which Detroit’s automakers are heavily dependent.
GM officials declined to delve further on the truck sales, saying that the automaker does not comment on the sales and earnings ahead of announcements. Analysts in the industry anticipate GM to post a profit overall in the first quarter. They added that they will be closely watching the North American earnings for signs of progress.
While the new Silverado and the Sierra are generally outperforming the rivalry, they have been injured by the slumping market. GM increased the production of the new pickups in hope of strong demand.Moreover, the trucks are being discounted $2,453 on average and are sitting on truck dealer.
GM’s pool of engineers has redesigned the pickups to make them bigger, more powerful and available with more features. This is why GM and Wall Street were expecting more.
Troubles in the truck market have been threatening automakers. The segment is heavily dependent on contractors who use the vehicles for work. As a result, demand has slumped with the housing market, as fewer workers build fewer homes.




Leave a Reply