UPDATE 1-GM’s new Chevy Silverado bids for more US pickup profits - http://ezmoneyonlinefromhome.com | how to make money onlineJanuary 14, 2018 12:42 am
Categorised in: Breaking Financial News
(New throughout, adds comments from executives, background)
By Nick Carey and Joseph White
DETROIT, Jan 13 (Reuters) – General Motors Co on Saturday fired a new round in the battle for profits from one of the U.S. auto industry’s most lucrative segments when it showed a new generation of its Chevrolet Silverado pickup truck at Detroit’s auto show.
The new Silverado, a highlight of the show, is the successor to GM’s best-selling vehicle in North America. Sales of the current Silverado rose nearly 2 percent to 585,000 vehicles in 2017.
Analysts and company executives say the Silverado and the similar GMC Sierra are among the highest-profit models for the company, generating a significant share of its $9 billion in North American pretax earnings for the first nine months of 2017.
By adding luxury features to their pickups, automakers have pushed prices in the segment to an average $46,984 a vehicle, according to Cox Automotive. That is well above the industry’s average 2017 transaction price of $31,600 cited by GM.
Competition in the North American large pickup market will heat up as GM and rival Fiat Chrysler Automobiles NV begin selling their redesigned trucks later this year and Ford Motor Co invests in its best-selling F-series.
Speaking on stage flanked by several gleaming new Silverados, GM global product development chief Mark Reuss said the automaker had cut the pickup’s weight 450 pounds (204 kilograms) using lighter materials including aluminum doors, hood and tailgate.
But unlike Ford, which jolted the industry in December 2014 when it launched the current generation F-150 with an all-aluminum body, Reuss said the frame and above all the pickup truck bed – one of the most important parts of pickups used for work functions – were still made of steel.
“I don’t think you’d get much work done with an aluminum hammer,” Reuss said, in a dig at Ford.
Fiat Chrysler plans to unveil a new generation of its Ram pickup truck at Detroit’s auto show on Monday.
At a sneak preview in December, GM said it would offer eight versions of the new Silverado and more engine and transmission combinations than the current lineup.
Executives said the new Silverado would have a high-strength steel bed floor and use “mixed materials” to cut weight and improve fuel economy.
The F-series, which has an aluminum body, has been the best-selling model line in the United States for 41 years, with 2017 sales of nearly 900,000 vehicles.
Ford announced this month it will launch a diesel version of the F-150 that will achieve 30 miles per gallon highway fuel efficiency, a level comparable to some midsize cars as it seeks to gain an edge in this competitive segment.
When describing the fuel economy of the diesel version of the Silverado Saturday evening, Reuss said “I am confident that we have the best performing diesel in the segment.”
Last year GM sold a total of 947,972 of its four Chevrolet and GMC pickup models, two of which were mid-sized.
U.S. consumers are shifting away from smaller cars in favor of larger SUVs, crossovers and pickup trucks, a major boon for the Detroit automakers.
Light trucks accounted for 63.2 percent of U.S. new vehicle sales in 2017, up from 59.5 percent in 2016.
However, U.S. new vehicle sales fell 2 percent in 2017 after hitting a record high in 2016 and are expected to drop further in 2018 as interest rates rise and more late-model used cars come back to dealer lots to compete with new ones. (Reporting by Nick Carey and Joseph White; Editing by Lisa Von Ahn and David Gregorio)