The surprising resurgence in mid-size trucks has fueled another month of increased truck sales with those trucks dominating the results. While their full-size brethren tried to keep pace, the mid-size trucks were really the July sales stars.
It has been a full month since the 2014 Toyota Tundra was set to hit dealers and the numbers aren’t good. Is the truck market cooling, bad marketing, lack of incentives or is the truck just not as competitive as Toyota thought? What’s your take?
According to this Automotive News story, GM classifies 1200 of their dealers as “rural.” While the definition of rural is likely a little loose, here’s what we know about GM’s dealership operations:
- GM has 4,400 dealerships across the USA
- 27% of these dealers are rural
- Toyota has about 1200 dealerships across the USA, and a very small portion of them are rural (our sources say less than 10%)
Assuming that each of these 1200 rural GM dealership can sell either Chevy or GMC trucks, and assuming that each of these dealership can sell a measly 5 trucks per month, GM can generate about 70,000 truck sales in rural areas that Toyota can’t hope to match.
In other words, GM has a big sales volume advantage because of their extensive dealership network in rural areas. Ford – and to a lesser degree Chrysler-Fiat – enjoy this sales volume advantage as well. Here’s what it means to Tundra sales figures.
I’ve noticed a fair amount of commentary lately about the Tundra’s status as a “sales failure,” (CNN ran an article a few days ago that I won’t link to here because it’s so stupid) and it’s shocking to me that so many otherwise smart people in the auto news industry can make such a silly argument. The Tundra’s sales definitely aren’t exemplary, but they certainly aren’t a “failure” when you consider the history of events between the Tundra’s debut in 2007 and today.
The worst part is, this silly story about the Tundra’s “sales failure” isn’t going away anytime soon. The Tundra plant was only running at 30% capacity in April and May, it’s only been running at 50% capacity for June, and it’s not expected to get back to 100% until August/September. That means that 2011 probably isn’t going to be a good year in terms of total Tundra sales.
Still, looking exclusively at sales figures to make a determination about the success of the Tundra is like reading a box score instead of watching the game: you get a sense of what happened, but you still miss a lot.
Toyota’s decision to move Tacoma production to San Antonio is most likely good news for the future of the Tundra. Still, the case can be made that this move signals danger. Tundra sales are down and Toyota executives have been less than positive about the vehicle. Moving production of the Tacoma to Texas could be a sign that the Tundra is on the way out.
To be clear, we believe the Tundra is here to stay. Still, there are quite a few reasons for Toyota to walk away from the Tundra completely: