GM still not seeing the light & Gas Prices

GM still doesn't seem to quite get it. They have now successfully introduced a vehicle, the HHR a successfully whopping 4 years after its competition was introduced, the PT Cruiser by the in-its-own-right infamous DaimlerChrysler. In fact, I've read that the development & design of the HHR was actually headed up by the same guy that headed up the PT Cruiser. At any rate, welcome to the table, GM, 2.5+ years after the hot demand for the PT Cruiser has tapered off.

To add further hurt to the whole situation, GM is now readying the launch/introduction/further downward spiral/self-suicide of their redesigned, next-gen gas-hogs, their SUVs. And, Katrina definitely doesn't help the situation given the incredible jump in fuel prices. GMs own research suggests that "gasoline prices must rise to $2.50 to $3 a gallon for a sustained period to change vehicle-buying decisions" (source). Well, GM, welcome to Katrina, a dip in oil supply, and an ever-increasingly-consumption-driven US consumer who demands more and more, at lower and lower prices. I'm sorry, but SUV sales simply won't be where they were before given the economic conditions we are in. Seriously, average gas prices have been well over $2.50 for over half a year now. GM's nonluxury SUV sales are off 27.2%. That's over 1/4 of their total sales!! Let's do the math, full-size truck sales has grown 16.7% over the last 6 years. Naturally, GM's revenues and profits from that segment have increased in-line with the growth. However, in less than one year, their sales in the same segment is now off 27.2%.

OK, come again. It took 6 years for the segment to grow less than 17%, yet, in less than a year, GM's sales are now off by 27.2%. What it took 6 years to grow, in less than a year GM has dropped by 150% off the respective growth.

GM (and Ford) wake up!! The SUV craze appears to be finally dwindling. Consumers are now regaining their brains, and buying vehicles that actually make sense.

Don't get me wrong, I like many aspects of SUVs. But, it's only a matter of time before American consumers realize they don't need to experience 13mpg to go pick up their obesity-rich McDonalds Value Meal (supersized, nonetheless).