A year after two Detroit automakers emerged from bankruptcy, 2010 offered signs of hope for the U.S. auto industry with the Big Three automakers all showing solid sales gains.
They have SUVs to thank for it.
Washington pols and their press parrots relentlessly touted a new wave of electric vehicles like the Chevy Volt and Nissan Leaf. But green-vehicle sales dropped half-a-percent to just 2.4 percent of the market last year while light trucks roared back to a majority of vehicle sales, fueled by low gas prices and fatter consumer wallets.
As a result, GM, Ford, and Chrysler all saw healthy gains in their bottom line as SUVs carry a substantial profit margin over small cars.
Chrysler Group reported U.S. sales of 1.1 million vehicles in 2010 — up 17 percent compared with 2009 — on the strength of its popular Jeep Grand Cherokee and Dodge Durango SUVs. And while President Obama heralded the company’s coming compact — the tiny Fiat 500 — Chrysler and Fiat chairman Sergio Marchionne prepared to expand the SUV lineup into Europe with Alfa Romeo and Maserati-badged trucks.
Ford sales were up 19 percent from 2009 on the strength of double-digit truck and car sales. And GM’s resurgence came on the back of 17 percent growth in its Chevy car and truck lines and a big 32 percent boost in GMC truck sales.
All told, trucks — which typically rake in at least twice the per-vehicle profit of cars — gained three percent of total market share over a year ago to become the majority of vehicles sold in the U.S. at 50.2 percent. That’s good news for GM and Chrysler as they pay back big taxpayer loans.
The contrast in consumer tastes to Washington’s stated preference is startling.
President Obama and the Pelosicrats not only mandated vehicles get an average 35.5 mpg by 2015 but encouraged the sales of hybrids with $2,500 subsidies. Yet sales of such vehicles actually declined.
On the whole, light trucks sales gained 18 percent while hybrid sales fell off by 5 percent. As manufacturers enter 2011 with oil on the rise at $100 a barrel, automakers will need to have a diverse lineup of vehicles to satisfy every consumer taste.
But 2010 made it clear that the green car is not an auto revolution — it is just another niche of vehicle.