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Detroit's Midsize SUV Problem


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Detroit's Midsize SUV Problem

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It's not just the mammoth SUVs that are suffering. The once-powerful midsize segment is also dwindling as gas prices rise and boomers age

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In the 1990s, NASCAR dads and soccer moms ditched their minivans for hauling kids and groceries and flocked instead to mid-sized, truck-based sport utility vehicles such as the mega-selling Ford Explorer and Chevy Trailblazer. That was great for Ford (F) and General Motors (GM), who minted money to the tune of $6,000 to $10,000 of profit per vehicle depending on incentive.

But the cultural and financial tide has turned against these balky gas guzzlers much faster than any of the companies' forecasts had predicted a few years ago. Both GM and Ford until recently had two assembly plants apiece churning out the SUVs. They each have gone down to one, each able to produce 300,000 per year at peak. But they're not even bullish on that half-market.

Ford is on track to sell fewer than 200,000 Explorers and nearly identical Mercury Mountaineers this year, with sales down 28% through May. Explorer sales peaked at 446,000 as recently as 2000. GM will strain to sell 260,000 Trailblazers and near-clone GMC Envoys, Buick Rainiers, and Saab 9-7s, down from last year's level of 380,000. How the mighty have fallen.

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Link to full story @ BusinessWeek Online

A good article that shows the precarious situations the Explorer, TB, Mountaineer, and Envoy are in and recounts the utter failure of GM and Ford to keep their minivans relevant.

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Liked the article very much. Finally someone who understands the car market writing about cars. Clear analysis without much bias. I think Chevy should replace the Trailblazer with a Lambda based Trailblazer. I don't think most customers would notice. The boat towing crowd can stick with the Tahoe. And it's not as if the Lambdas will have no towing capacity at all. I should think 3000-4000 lbs would be possible.

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many folks (especially in smaller metro and outside urban areas) like and NEED BOF mid sized SUV's. There is always a place for Explorers and Trailblazers.....towing, rugged terrain, general sturdiness.

even though lots of folks only want a a crossover now, there will still be a huge market for TB's, Explorers and Durangos.

I fail to see how 200 thou of exploders and 260 thou of TB's is minute. Yes its down, but that's still a half a million vehicles. GOD, get a grip.

Edited by regfootball
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While I can understand the reason for the downturn in midsize SUV sales (gas prices), our 04 Trailblazer has turned out to be a great and useful vehicle. I've used it to haul cabinets for the bar I built in the basement, plants for our landscaping and help to move friends and relatives. The money I saved on delivery charges has paid for many tank fulls of gas.

The Trailblazer is currently getting about 16 - 18 mpg (suburban driving) on 87 octane fuel. It replaced a '99 STS that was getting 17 - 19 mpg for the same suburban driving, on premium fuel.

Going down to Southern Illinois this weekend (700 mile round trip) and I expect to get 22 - 25 mpg on the highway. It should average 22 mpg for the trip.

As GM produces more direct injection, six speed tranmissions and DOD engines (better gas mileage), the sales numbers of SUV's should stabilize or go up slightly, based on the versitility of the vehicles.

The best reason for owning the Trailblazer is my 5 year old grandson. He always wants to ride in Papa's black car. It's the command seating. He sits up high where he can see everything.

Edited by RichW5
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WOW!

BusinessWeek must've launched a HUGE anti-Detroit campaign!!!

More bull$h!.

HUH

I believe BW is just reporting the facts.

Sales are down in the mid-sized SUV segment since Sept. 05.

That is fact.

GM, F and DCX are heavily leveraged by the mid sized SUVs.

That is fact.

The only thing missing in the BW article is FOG is full of crap again.

Even still, that is still fact.

Edited by evok
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HUH

I believe BW is just reporting the facts.

Sales are down in the mid-sized SUV segment since Sept. 05.

That is fact.

GM, F and DCX are heavily leveraged by the mid sized SUVs.

That is fact.

The only thing missing in the BW article is FOG is full of crap again.

Even still, that is still fact.

True enough... the article seemed pretty factual to me.

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I don't know why people are thinking this and articles like it are saying that the midsize truck-based SUV will disappear because it won't. However, its glory days are clearly over.

Looking back on 2000-2010, we'll see that the weakling and redundant SUVs will simply go away. There will always be a Trailblazer, Explorer, JGC, 4Runner, Durango, and Pathfinder no question, but how many of the others will stick around in their present form? 'Others' meaning Mountaineer, Envoy, Armada, Sequoia, LX470, Commander, and Aspen.

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"Get a grip?" When a segment halves in 6 years, that is alot.

Most loyal to shrinking segments buy used, also.

The Tahoe gets nearly same MPG and more room. Why bother with overlap? And don't say "tradition". That is what got GM in trouble.

To those that screm 'bias' every time, well, should it be like old East Germany? Remember the Trabant? Have government owned GM and people are forced to only buy from them. :P

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Aren't the import branded SUVs losing sales, as well? I know Toyo & Nissan have also invested heavily in SUVs, yet the article doesn't mention them.

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Aren't the import branded SUVs losing sales, as well?  I know Toyo & Nissan have also invested heavily in SUVs, yet the article doesn't mention them.

While Toyota and Nissan ave both invested in SUVs a lot lately, they still focus on cars and, in Toyota's case, sell a lot. Neither company has shifted their focus to SUVs as severely as GM and Ford have, plants that once built Caprices and Contours now build Tahoes and Escapes. Not that there is really a need for Caprices and Contours (neither was what I would call an exceptional vehicle) I'm just showing how GM and Ford (DCX got into the SUV game late, and still focuses more on cars) shifted focus. Maybe if we invade Venezuela and Iran, SUV sales will rise on the back of $0.65/gallon gas.
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Maybe if we invade Venezuela and Iran, SUV sales will rise on the back of $0.65/gallon gas.

If we invade Venezuela or Iran, we would have $10/gallon gas and the stock market would drop 80 percent.

Back to mid size SUV's, unless you go off-road, I don't know why anyone would pick an Explorer or TrailBlazer over either a full size SUV or a crossover.

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One thing I will straight away give the 360s is the awesome Atlas I6 engine.

Tru dat. If only they had made it fit in the Colorado, while the I-5 seems powerful enough, the I-6 would be able to tow more and would make a great starting point for a Syclone.

Edit: Or made a cheaper SSR with it or produced the Bel Air.

Edited by Satty
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Tru dat.  If only they had made it fit in the Colorado, while the I-5 seems powerful enough, the I-6 would be able to tow more and would make a great starting point for a Syclone.

Edit: Or made a cheaper SSR with it or produced the Bel Air.

Can you imagine a turbo I6 churning out 300+hp/tq in a Colorado SS std cab shortbed? Or likewise in a GMC Typhoon?

Or a 270hp fixed hardtop SSR without the pickup bed cover but with cloth seats and a 6-speed for $26/7k? GM would've had to stop production to find a plant with higher capacity.

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Can you imagine a turbo I6 churning out 300+hp/tq in a Colorado SS std cab shortbed? Or likewise in a GMC Typhoon?

Or a 270hp fixed hardtop SSR without the pickup bed cover but with cloth seats and a 6-speed for $26/7k? GM would've had to stop production to find a plant with higher capacity.

There is so much potential for performance in a Colorad0/I-6 package its unreal. Performance trucks wouldn't add many sales but wouldn't hurt GM's image.

Your SSR idea would have been great from the start, made the SSR an option for more people and maybe made it viable for the long term.

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If you look at the 'footprint' of a Tahoe vs. a Trail-Rainer-Envoy, they are nearly the same, but Tahoe offers more room and utility. GM wants to keep the Tahoe/Suburban and the Equin-orrent, but the middies are getting squeezed out.

Tahoes now get same or better MPG, why get a Blazer?

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I believe BW is just reporting the facts.

the article seemed pretty factual to me.

Go back and read it again. ;)

Again the article was an excellent read the second time around.

It posses the question, "What does GM and Ford do in the misized SUV segment, when:

1) Both companies are heavily leveraged by those vehicles.

2) Sales drop off a cliff.

The BW aticle is sound analysis back up by hard data. I can not dispute any opinions or judgements in the article because when the authors do opion or occasionally use colorful words here and there, it is back up by the sales data.

There is no disputing that GM just put out a stop work on the NG GMT 360s and there is a crash GMT561 lambda program to cover themselves in the midsized segment as the market transitions OUT of BOF midsized suvs.

There is no disputing that a 40% reduction in midsized SUV sales hurts GM and Ford a heck of lot more than the competition. That is hundred of thousands of vehicles compared to say only thousands for Toyota or Nissan. The significance is apparent when the volume is so much greater for GM and F.

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the article seemed pretty factual to me.

Go back and read it again. ;)

Again the article was an excellent read the second time around.

It posses the question' date=' "What does GM and Ford do in the misized SUV segment, when:

1) Both companies are heavily leveraged by those vehicles.

2) Sales drop off a cliff.

The BW aticle is sound analysis back up by hard data. I can not dispute any opinions or judgements in the article because when the authors do opion or occasionally use colorful words here and there, it is back up by the sales data.

There is no disputing that GM just put out a stop work on the NG GMT 360s and there is a crash GMT561 lambda program to cover themselves in the midsized segment as the market transitions OUT of BOF midsized suvs.

There is no disputing that a 40% reduction in midsized SUV sales hurts GM and Ford a heck of lot more than the competition. That is hundred of thousands of vehicles compared to say only thousands for Toyota or Nissan. The significance is apparent when the volume is so much greater for GM and F.

He's prolly just pissy about some arcane trivia fact being off.

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All the more reason to eliminate the Tahoe. If you are needing that much space, buy a Suburban, if you need less, get the Trailblazer. With the Equinox, that gives you small, medium, large avoiding the unnecessary at Chevy Lambda.

If the capacity is a problem, bring back the K-5 Blazer. Seemingly useless back when they killed it, there would be a niche market now, with the only competitor in the 2-door class the much smaller Jeep Wrangler. . .

Edited by thedriver
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All the more reason to eliminate the Tahoe. If you are needing that much space, buy a Suburban, if you need less, get the Trailblazer. With the Equinox, that gives you small, medium, large avoiding the unnecessary at Chevy Lambda.

If the capacity is a problem, bring back the K-5 Blazer. Seemingly useless back when they killed it, there would be a niche market now, with the only competitor in the 2-door class the much smaller Jeep Wrangler. . .

i see no issues with having the tahoe and suburban and trailblazer coexist as is in size.

the tahoe is for those who want a full size frame, but not as long as the suburban. the TB is for those who want something more garageable, yet still full frame tough, while not as large feeling as the tahoe.

there is room for all three. GM and Ford's problem are betting the whole corporate existence on them.

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The Trailblazer, Grand Cherokee, and 4Runner sell not just because of their towing or off-road ability, but also their inherent coolness and machnoness. Young males like them because they're not as motherly as, say, an Equinox or RAV4. I'm happy with crossovers like the RR Sport, Cayenne, and X5, because they look beefy... not fragile and "on stilts" like the Highlander.

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