The U.S. is presently one of the world's largest manufacturers, and consumers, of automobiles. What percentage of Detroit's profits, would you guess, comes from trucks as opposed to passenger cars? The Big Three aren't saying, but according to a Reuters analysis looking at the EBIT—that's Earnings Before Interest & Taxes—an astonishing 71%* comes from trucks and SUVs.
"There is no doubt that full-size trucks are still the single largest component" of pre-tax profits at General Motors Co, Ford Motor Co and Chrysler Group LLC, a unit of Italy's Fiat SpA, according to Sterne Agee auto analyst Michael Ward.
Even more surprising is that sales of full-size pickups grew 20% from last year.
Gas is still expensive (by American standards) and the economy is still pretty lousy, so what's going on? Why do hybrids continue to be money-losers while low-MPG truck sales are soaring? Why has Ford's F-150 been the best-selling automobile for three decades? The old stereotype of soccer moms with misconceptions of safety ensconcing themselves in SUVs doesn't explain the bump in full-size pick-up sales, nor the F-150's success.
Well, talk to someone who drives a truck. I rang up a former ID classmate of mine who now runs an appliance repair business and has owned over half-a-dozen full-sized models. While he now drives around town in something the size of a small submarine, I asked him about his favorite ride, a monstrous '05 Dodge Ram 1500 Quad Cab with the 5.7-liter Hemi. The thing got 10, maybe 11 miles to the gallon and required a three-figure fill-up. Why drive it?
Power and versatility—that thing never stopped hauling. Never mind all my tools, I'm talking lumber, refrigerators, I towed a 25-foot boat, you name it.
And it was fast. 100% Detroit power with that Hemi. I could physically get to jobs faster [to beat nearby competitors]. You don't want to lose a contract because you're stuck behind some idiot on the Turnpike.
And trucks are comfortable now, they're not like they used to be. If I wanna take my wife out for date night, or take some buddies on a trip with the Quad Cab, it's no problem. I used it for work and I used it for pleasure.
I asked him if he could've done what he was doing with a lesser vehicle. "Absolutely not," he said. "I would've needed three different cars to do all the types of things I was doing." So he lived with the outrageous gas costs, as he found it ultimately cheaper than purchasing multiple vehicles.
It's my belief that for every high-profile Hollywood celeb who forgoes a Bugatti for a Prius, there are thousands and thousands of Americans like my buddy who need, rather than want, a truck. Our entire physical environment has been constructed by, and continues to be serviced by, guys who drive trucks.
Outside of America is different, of course, and what I'd like to know is why—and how. With the exception of Iceland, I never saw full-sized pickups in American numbers anywhere else, whether it was Scandinavia, Europe or Asia. To our readers in those parts of the world, how do your tradespeople get around? How about you folks in Australia/NZ? And to our American readers who drive trucks—not you armchair QBs who blindly hate them and can't be bothered with underlying causes—tell us about your beasts, why you drive them, and what you'd like to see done differently.
*Please note that that 71% does not reflect the amount of trucks on American roads; I believe that number is below 20%. The 71% of profit coming from trucks indicates that they are high-margin items, which means that with growing demand, Detroit will only continue to produce more of them.