GM’s Market Share on the Brink
By Blake Muntzinger
General Motors could be making history, but it is not the sort they – or any company – would boast about. According to the Wall Street Journal, GM’s market share could slide under the 20% mark for the first time, a far cry from its sales 10 years ago when it clung onto 29% of the market.
Fuel prices hovering around $4 a gallon, a faltering housing market and economy, and Detroit’s reliance on sales of SUVs and pickup trucks – a segment plagued with falling sales over the last few years, and a massive drop in the last few months – are cited as factors for the sales downturn. GM recently opted to shift some of its production from pickups to cars to keep up with the market.
Unfortunately, GM is fighting the uphill battle against the quality juggernauts Honda and Toyota. The initial quality tide appears to have turned on some models and in the process of doing so on others. But consumers’ perceptions on reliability, while increasing, are still below those of the import brands. Of those marques, Toyota packs the most lethal punch; worldwide sales arguably surpassed GM in 2007, and its US market share in April was 17.4%.
It’s true that in the 1990s, GM focused on SUVs and trucks that guzzled fuel like college students drinking beer on a Friday night. But, it produces fuel efficient models too. According to the EPA, however, none of them reach 40 mpg on the highway. Chevrolet’s Cobalt rates the highest with highway mileage of up to 36 mpg, besting the competition from the Mazda3 to the Nissan Versa. Drivers must know how to drive a manual transmission to take advantage of it.
GM’s hybrids currently on the market all have fuel-burning counterparts, but none are selling at record paces. The Volt, GM’s poster child of green-ness, will reportedly be shown in all its production glory at the Mondial de l’Automobile in Paris this fall. These latest sales developments from domestic and foreign brands alike show the market is shifting quickly, and while GM has plug-in hybrids and hydrogen-powered vehicles in development, the market shift seems too fast and GM too slow. Those vehicles cannot get to consumers soon enough.
GM’s May sales results will be released tomorrow, but even if sales are high enough for market share to remain above 20%, odds are that they won’t look pretty.
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