Sales holding up. This time, Detroit is ready for high Gas prices
May 19, 2011
Soaring gas prices in 2008 helped cripple Detroit’s automakers, but there’s a different vibe in the industry today, even though gas prices are volatile and hovering around $4 a gallon.
Motorists aren’t pushing the panic button, and neither are automakers. Owners of gas-guzzling trucks and SUVs, who rushed to unload them three years ago, are taking a wait-and-see attitude. Shoppers in the market for a new car or truck aren’t delaying purchases, but shifting to smaller or more fuel-efficient vehicles — many of them from domestic brands…
As a result, demand is holding up — 20 percent stronger this year, compared to last — as the industry’s fragile recovery continues. U.S. car and truck sales are expected to reach 13 million vehicles this year, comparable to 2008 but well above 2009′s 10.4 million tally.
When gas hit a national high of $4.06 per gallon in 2008, consumers’ love affair with big vehicles ended abruptly. Ford Motor Co., General Motors Co. and Chrysler Group LLC felt the sting worse than foreign rivals because they were more dependent on large fuel-thirsty but highly profitable vehicles.
The story quotes car dealers saying that smaller, fuel efficient cars are selling “..right off the convoy trucks.” One dealer in Ann Arbor said he “can’t get enough” Fiestas and Focuses. “I wish we had twice as many.”
GM announced in the face of 4 dollar plus gas, it is boosting production of Chevrolet Volts – in the face of ”tremendous consumer demand..”
General Motors Co. plans to boost production for its range-extending electric car, the Chevrolet Volt, to 16,000 vehicles this year, and 60,000 in 2012, the company said today.
The Detroit carmaker had originally planned to build 15,000 Volts this year, and 45,000 in 2012, but strong demand for the battery-powered car has prompted the company to churn out more.