GM announced last month they are closing plants and shuttering several others. The direction they cite is that they are moving away from sedans and will shift volumes towards SUVs and trucks. Ford announced many months ago they are only going to produce the Focus and the Mustang for car production. FCA is killing other sedans in their fleet also. Everyone states that we the consumer desire SUVs and trucks.
I spent 28.5 years at Ford Motor Co. and had the opportunity to watch these trends several times during that period. In the late-’70s we did not have the correct product mix and suffered greatly until we could get the then new Escort to market. Both GM and Chrysler have suffered the same peril at different times also. The problem is that producing automobiles is a capital intense business and lead times to switch model direction are slow, expensive initiatives.
This is what concerns me with the recent announcements.Today, everyone says they want trucks and SUVs. They say they like the utility and many say they like sitting up high. It makes me laugh. They like sitting up high. I suppose if this trend continues we will all be driving around in Class 8 SUVs. How are all the soccer moms going to get up in those cabs?
Then there is the pick-up phenomenon. Have you looked around on the road lately? It seems that every other vehicle is a pick up. I am as guilty as the next guy. We have a new F-150 in the driveway too. My wife really wanted it and so of course now we have one, but why? It is so convenient when we need it. How often is that really? It is just as convenient to go get one at Lowes for $19.95 the six times a year we really need it. Luckily, we have the EcoBoost model and it gets reasonable mileage. Most owners brag about their Hemi, Triton or Duramax diesel V8s. Ours just creates incredible amounts of performance using F1 racing technologies and high rpms. Not what we would usually think of for how a truck operates. Just what is going to happen when we get a little blip in the oil supply and fuel costs go above $4.00 again?
Please do not misunderstand me. I love big, powerful vehicles as much as the next guy. But I also remember the sting of having the wrong vehicle mix. CAFE (Corporate Average Fuel Economy) is a real thing, and eventually, we the consumer will have to pay the piper. In the meantime, these technology-laden vehicles that make goo gobs of power from small displacement will most certainly not have the long-term durability of the good old gas guzzlers. More rebuilds for all of us, right?
So now that I think of it, I guess that part of it is not all bad. You and I will probably benefit from all this. That is the beauty of our business. No matter what is going on around us, engines still need maintenance and repairs. All that eventually requires a rebuild or machining and the last time I checked, that’s what we do.
Happy 2019.
