It is still a mind-bender among car enthusiasts how the European, Japanese, and South Koreans, can find a market for cars that the American manufacturers can’t? Yeah, we’re seeing the dominance of SUVs and trucks over cars. Everyone says those are the future. But so was the Toyota Prius when it came out 15 years ago. You didn’t see Toyota start pulling back on Camry, Corolla, and Avalon models. The Prius wasn’t a replacement for those models. It was just another product; another model. But the American car companies for years have skewed their lineups and marketing towards SUVs and trucks. So, now we are at the point when luxury car maker Lincoln will have only one car left in its lineup after this July.
Proportionally, trucks were less expensive compared to cars than now
The higher margins have always been with the SUVs and trucks. Especially when you compare pickup truck prices in the 1970s to cars. Proportionally, trucks were much less expensive compared to cars than now. So not only do trucks have a higher margin but that margin has increased relative to cars.
Cars are more expensive to produce than trucks. So, one of the reasons you’re seeing the end of cars is because they have been pushed aside for the higher-margin vehicles by all of the manufacturers. There are other things involved, too. Things like culture, customer needs, and trends.
America likes its vehicles big. It wants them to be luxurious. Since the 1940s small cars have always been viewed as cheap transportation. For the “little people.” The unwashed masses.
Pintos, Vegas, K-Cars, X-Cars; there was a flood of them
When the gas crunch came in the 1970s many switched to smaller cars and Detroit provided them. Pintos, Vegas, K-Cars, X-Cars; there was a flood of them. And every one of them was a cheap, crappy little car. As soon as gas prices leveled out in the 1980s every one of those cars was gone by the end of the decade.
And not just as new cars. They were gone from the highways because they rusted or just fell apart. But the trucks and SUVs from that period, though hungry for gas, held up. They were built like tanks and were larger like Cadillacs and Lincolns in the 1950s and 1960s. And that is what America wanted. Big, powerful, and built to last. Not crappy little toasters on wheels.
Doors clanged, bodies rolled, and clear-coats peeled almost immediately
But the car companies here just couldn’t build a quality car. Front-wheel-drive Cadillacs and Chevy Caprices, Ford Taurus, and Dodge Dynasty; still crappy. Build quality, materials, and in some cases the styling was all subpar at best. Doors clanged, bodies rolled, and clear-coats peeled almost immediately.
So here we are. Lincoln’s MKZ will cease production in July. Not that you knew what the MKZ was because you couldn’t remember MKZ from MKL and MIC KEY MOUSE. Another wrong move made to repel customers rather than sticking with brand names that everyone related to. Eldorado, Continental, Imperial; decades had been spent building those brands. What is an MKZ?
Looking at 3-Series BMWs, Toyota Avalons, and Genesis sedans; you can see the quality. And you can feel it, too. Genesis didn’t even exist just a few years ago. Now it is held in the same acclaim as some of Europe’s finest. Don’t stick the reason American car companies can’t build them like that because of labor costs.
Since the Chrysler and GM bankruptcies in 2009 labor costs have decreased
Labor has been evened out since the Chrysler and GM bankruptcies in 2009. It’s a lot of small things and larger things that have come together to kill off the sedan. It’s a shame that for such a headstart and lead building the best cars in the world that in 20-30 years that role completely flipped. And it turned so quickly that now American car companies are almost done cutting every car it makes.
But as manufacturers get serious about SUVs the competition is making it more difficult for American companies. This time there’s no alternative to jump to.