2015 GMC Canyon

[AlRozzi]

Does the market shift or do marketers shift the market?

 

It is my contention that anything can be sold if it is marketed properly. Look at jewlery. Who needs it? Nobody. But people are led to believe they want it.

 

4 door pickups were likely pushed by manufacturers at the time to expand profitability, not unlike all the other gadgets offered on vehicles these days.

 

Profit is increased two ways, really, by selling a more expensive vehicle and in the case of most cars these days, by not having to offer as many body styles as a means to reduce complexity and cost/increase profit.

[akirby]

You're rationalizing because you can't accept that your favorite vehicles are no longer viable.

 

Marketing can only do so much. You can't sell a family of four a regular cab truck as a second vehicle.

 

The mfrs make what people want to buy, not vice versa. Because if one mfr stops making something that people still want then another one will do it.

 

Marketing works great on $5 food items or other cheap impulse buys. Not so much on a $30k vehicle that you have to use daily for several years.

 

Why haven't the other mfrs either upgraded their small trucks or brought out new ones if the sales are just sitting their for the taking?

Because the sales potential isn't there and no amount of marketing will change that.

 

What you want us to believe is that every product team at every mfr is wrong and you're right.

[RichardJensen]

Does the market shift or do marketers shift the market?

 

It is my contention that anything can be sold if it is marketed properly.

 

Let me put it to you this way:

 

If marketers can entice people to buy literally *anything*, then why aren't we currently buying cars with AM radios? Because AM radios are cheaper than today's current entertainment systems, and if marketers can sell anything, then they should be able to convince people to buy an AM radio equipped car with manual door locks, manual windows, button tufted velour seats, etc.

 

Because all that is way cheaper than today's cars. So why, again, would a car company improve their product when it would be much easier to get their sales staff to convince people to buy their old crappy product?

[AlRozzi]

You're rationalizing because you can't accept that your favorite vehicles are no longer viable.

 

Marketing can only do so much. You can't sell a family of four a regular cab truck as a second vehicle.

 

The mfrs make what people want to buy, not vice versa. Because if one mfr stops making something that people still want then another one will do it.

 

Marketing works great on $5 food items or other cheap impulse buys. Not so much on a $30k vehicle that you have to use daily for several years.

 

Why haven't the other mfrs either upgraded their small trucks or brought out new ones if the sales are just sitting their for the taking?

Because the sales potential isn't there and no amount of marketing will change that.

 

What you want us to believe is that every product team at every mfr is wrong and you're right.

The point I've been trying to make is that a product needs to be engineered to meet current customer expectations. Just like Ford taking weight out of the F-150 to make a gas guzzler viable. Just like loading up small cars to make them profitable. Just like engineering a new generation of Lincolns to make the brand successful.

 

If small trucks had been designed to meet customer needs of today, then their would be a market for them. The genre had been left to dry up. Compare the sales of Ridgeline v. Tacoma. Toyota is closer to what customers would hope for in the segment than is Honda.

 

But really, I'm not trying to be a jerk about this. Frankly, I'm not even a truck guy and have no desire for anything but a car. I'm only attempting to point out that if a product is engineered with current customer needs in mind, it will find buyers.

 

Product engineers, planners and marketers must design a product customers like and find value.

[AlRozzi]

 

Let me put it to you this way:

 

If marketers can entice people to buy literally *anything*, then why aren't we currently buying cars with AM radios? Because AM radios are cheaper than today's current entertainment systems, and if marketers can sell anything, then they should be able to convince people to buy an AM radio equipped car with manual door locks, manual windows, button tufted velour seats, etc.

 

Because all that is way cheaper than today's cars. So why, again, would a car company improve their product when it would be much easier to get their sales staff to convince people to buy their old crappy product?

 

Richard, I think you guys are limiting your view of things to how they once were. Technology changes. As I mentioned above, texting is just a modern interpretation of the telegraph. As such, AM radio could find somewhat of a rebirth in all honesty. In fact that is all I listen to these days talk radio.

 

However, to say that offering only AM radio in a car is the same as an entire class of vehicle is two different things entirely.

 

If marketing didn't work, we wouldn't have a viable capitalistic economic system.

 

In business school we did case studies and with one of them we had to take a position on disposible shavers siding with either keeping them simple and inexpensive or choosing to offer more features but costing more, like different colors, dual or triple blades, glide strips, etc. Neither choice was incorrect, we only had to defend our decisions

 

Anyway, don't intend to be an " " about this.

 

I appreciate the discussion.

[RichardJensen]

However, to say that offering only AM radio

 

But your stated position is that "anything can be sold if it is marketed properly"

 

And my point is that while this may be true in a theoretical sense, in a practical sense, every decision carries risk, and riskier propositions are not generally justifiable.

 

For instance, simplifying: "Let's invest $1B in a new CUV. We anticipate sales of 250k per year, with a roughly 10% margin for error. Our break even is 200k units." vs. "Let's invest $800M in a new compact truck. We anticipate sales of 180k per year, with a roughly 25% margin for error. Our break even is 160k units."

 

Pretty clear that the first option is the smarter one, even if the second option is cheaper. Why? Because the market can't be estimated as clearly, it's smaller, and the break-even is higher.

Edited February 2, 2014 by RichardJensen

[PRM]

I'm not sure anybody here really knows the answer on whether poor mid-size truck sales are due to lack of a modern design or truly no market exists. Honda is releasing a new Ridgeline, Chevy/GMC are releasing a new Colorado/Canyon, Toyota continues to build the Tacoma. Ford and Dodge are out of the market. So, not even industry agrees on one particular answer. Clearly Honda and GM think a new design has the opportunity to capture sales. I'll be curious to see what the new TRD Pro Tacoma really is. I had a '94 Ranger and it was essentially the same truck as the Ranger offered in 2012. What if Ford offered the '94 Explorer in 2012, would it have sold well? Of course not. Vehicles must evolve. Vehicles don't always have to be perfectly practical either. Look at the Raptor, nobody NEEDS a Raptor. But they get it because they like it, they want it even in spite of the poor mileage, large size, etc. What if they built a ~88% scale Raptor that got decent mileage with 4 or 6 cylinder Eco-Boost, 8-10 speed tranny, aluminum body, and so on? Cool truck, and without the large size and high cost of ownership. I think they'd sell quite a few. Of course they would have 'practical' versions as well. I believe sales went to SUVs and CUVs due in large part to no viable mid-size truck design. Build one and they can capture market from other manufacturers.

[AlRozzi]

 

But your stated position is that "anything can be sold if it is marketed properly"

 

And my point is that while this may be true in a theoretical sense, in a practical sense, every decision carries risk, and riskier propositions are not generally justifiable.

 

For instance, simplifying: "Let's invest $1B in a new CUV. We anticipate sales of 250k per year, with a roughly 10% margin for error. Our break even is 200k units." vs. "Let's invest $800M in a new compact truck. We anticipate sales of 180k per year, with a roughly 25% margin for error. Our break even is 160k units."

 

Pretty clear that the first option is the smarter one, even if the second option is cheaper. Why? Because the market can't be estimated as clearly, it's smaller, and the break-even is higher.

Yes, anything, but that is a very narrow, literal view of the comment. Products must be modernized for safety, EPA, features.

 

Ford still sells the Focus compact car, for example, only it is the 2014 model, not the 2000.

 

R&D and engineering come into play with your hypothetical example. What if, for instance, a dynamic and modular platform could be developed, not unlike what VW is planning, and could adopt such a vehicle(s)?

 

I would argue why not find a way to re-enter a market left cold or pioneer a new market, for that matter (i.e. EVs, fuel cell...)?

 

Consider what had been the prevailing view of the potential for a minivan in the late seventies.

 

I wouldn't be defeated or accept what others are doing or saying. There may be a way. Or not.

 

Back to small and mid-size pickups, my opinion as to what is currently being offered by the Japanese and the new offerings from GM are not going to unleash the segment. There are no new ideas or technology breakthroughs for costs or otherwise. If there is a market for a revival of the segment, I don't see a viable offering as of yet.

[RichardJensen]

not unlike what VW is planning

 

FYI: Ford has been doing what VW is 'planning' for about the past eight or nine years.

[RichardJensen]

I'm not sure anybody here really knows the answer on whether poor mid-size truck sales are due to lack of a modern design or truly no market exists.

 

Clearly, there exists a market for this kind of truck.

 

The question is the wisdom of pursuing a chunk of this market at the expense of another market that may be easier to enter and which may also prove to be more profitable.

 

Additionally, I am disinclined to consider any GM course of action as the end result of competent decision making.

[jpd80]

R&D and engineering come into play with your hypothetical example. What if, for instance, a dynamic and modular platform could be developed, not unlike what VW is planning, and could adopt such a vehicle(s)?

 

I would argue why not find a way to re-enter a market left cold or pioneer a new market, for that matter (i.e. EVs, fuel cell...)?

 

Consider what had been the prevailing view of the potential for a minivan in the late seventies.

 

I wouldn't be defeated or accept what others are doing or saying. There may be a way. Or not.

 

Back to small and mid-size pickups, my opinion as to what is currently being offered by the Japanese and the new offerings from GM are not going to unleash the segment. There are no new ideas or technology breakthroughs for costs or otherwise. If there is a market for a revival of the segment, I don't see a viable offering as of yet.

Consider the amount of diversity in the current market, if a resurgence of a particular sector was to happen,

automakers would be all over it but what has actually happened is fragmentation, apart from maybe half ton

trucks, no vehicle ot vehicle type really dominates the market, so a lot of the opinions about offering vehicles

is more about casting the net wider - is the return form doing that better than investing elsewhere?

[akirby]

The decline in small truck sales started when the trucks were still modern and still relevant, so to say that the decline is because they were left to wither on the vine is not accurate - it's the other way around. They were left to wither because the market itself was shrinking and the mfrs did not want to invest a lot in a shrinking market segment.

 

If it was as simple as updating the vehicles to significantly increase sales then why didn't Nissan or Toyota do it? Why didn't a new player enter the market with a new product? Why don't all of these mfrs understand that all they have to do is build a modern version and market it?

 

You say that Ford should be building the vehicles that people want? They are - they're called crossovers. And when gas hit $4/gallon people moved away from trucks in general and went to hybrids and small cars with better gas mileage. There were no crossovers, hybrids or $4/gas when the Ranger was on top. A lot of folks also bought Rangers because they were cheap cheap cheap ($7995 for my 90 Ranger). There isn't a lot of profit in cheap small trucks and there aren't a lot of potential customers who want an expensive small truck.

 

The market is there but it's a fraction of what it once was and there is no indication it will ever get close to what it once was because there are too many other choices out there now.

[AlRozzi]

Arrgh...this topic is the beast that won't die! I was hoping I would log on to find it was dead.

 

I give you the final word my friend (akirby). You are right on regarding those cheap Ranger prices.

 

Now I think I will find another topic we can discuss:-)))

[PRM]

 

Additionally, I am disinclined to consider any GM course of action as the end result of competent decision making.

 

I will not argue with that.