Detroit’s big profit machine is the SUV and pick-up markets. Even through sales in these categories have fallen off, the margin per unit has stayed strong. Unfortunately, Toyota (TM) has moved into the large SUV and big pick-up markets with products like it Tundra monster truck. And, that is hurting Big Three sales.
Now VW, one of the world’s largest car companies has decided that the US and Japanese companies should not be having all of the fun and all of the profit. According to the FT, VW is considering developing a pick-up truck as it seeks to boost global sales and challenge the growing power of Japan’s Toyota
VW is the largest car company in Europe, but its sales in the US are awful. Having a pick-up line could help remedy that. And, it could also fragment a market that Detroit counts on for much of its profits.
Douglas A. McIntyre