Detroit’s Big 3 Places Bets In Big Apple
April 10, 2007
Detroit's Big Three has placed big bets at the recently held New York International Auto Show (NYIAS). This is done to boost its standing in the automotive realm. And the Big Three is starting the change in the Big Apple.
In the said auto show, the Chrysler Group has unveiled its redesigned 2008 Jeep Liberty which comes as a top selling compact SUV. The Ford Motor Co. has also introduced its new Flex vehicle which is a large crossover SUV replacing its minivan. And General Motors Corp. unraveled Buick Super series and concept minicars to reach out to the generation Y.
New York offers a huge potential auto market and the territory can influence the entire nation. This is the reason why Detroit’s Big Three is placing big bets in the Big Apple. "There's always a chance that someone can create some momentum from the show that can help sales," said Tom Libby, an industry analyst for the Power Information Network. Erich Merkle, an analyst with IRN Inc. which is an automotive consulting company, added, "There's a huge amount of media attention in New York and from there, the country is addressed.”
The March sales reports say it all - the Big Three’s sales are rather slumping. Compared with last year’s March reports, Chrysler and GM sales dropped four percent while Ford's declined by nine percent. Hence, the road to recovery is anchored on building new vehicles that purchasers could not reject.
The Chrysler Group has debuted two models: the redesigned 2008 Jeep Liberty and refreshed 2008 Grand Cherokee and these are the brand's two hot selling vehicles. "We sell about 20 percent of Jeeps in the Northeast," said John Plecha, the director of Jeep marketing. Plecha said Jeep does not want to shun the future women buyers, but the brand still hopes that the Liberty appeals to more customers in general.
Jesse Toprak, a senior analyst for Edmunds.com, said that the Liberty may run into some problems. "The compact SUV market is getting much tougher to compete in because so many automakers are providing models."
Jeep's other vehicles - such as the Patriot and Compass - may also hurt the new Liberty, said Merkle. It will compete too closely with other Jeeps in the same price range, he said. "It's not that I don't like the product," Merkle said, "but there's too much internal competition."
Ford has also introduced a new SUV in Flex. The offering of the automaker is to deliver something original to aficionados. Based on the Ford Fairlane concept, the Flex is a calculated risk, Libby said. "This is a progressive move," Libby said. "Ford really needs this to work. They believe they can fill that part of the market with a large crossover."
"That's one of the most critical launches they'll have," added Merkle. "The crossover SUV segment has been growing by leaps and bounds. It's displaced the SUV as we know it."
While Chrysler and Ford struggle, GM seems to be successful in stepping on the brakes to stop sales declines. It appears that the automaker is making an obvious progress. GM has released the Super series, performance versions of the Lucerne and redesigned LaCrosse to breathe new life.
"They can't wait for all of the loyal Buick buyers to die off," said Toprak. "The Super designation is part of that effort. Will it work? It's too early too tell." In regard to the minicars, Toprak hopes the General brings them to the United States.
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