GM's Chevrolet brand takes aim at Ford
By Michael Ellis
DETROIT, Jan 7 (Reuters) - After lagging the Ford brand for 15 years, General Motors Corp.'s <GM.N> Chevrolet division expects a trio of new vehicles to be unveiled on Tuesday to move it closer to becoming the best-selling brand in the United States, GM officials said.
Ford Motor Co.'s <F.N> Ford brand outsold Chevrolet in the United States by nearly 625,000 vehicles in 2001, but that gap narrowed to about 350,000 vehicles last year, as the GM brand took market share away from its cross-town rival, particularly in sport utility vehicles.
Chevrolet expects three new vehicles it will debut at the Detroit auto show on Tuesday -- the Malibu mid-size sedan, the Colorado mid-size pickup truck and the Equinox compact sport utility vehicle -- to add another 250,000 units to annual sales, Chevrolet General Manager Kurt Ritter said.
"For the first time in 15 years, Chevrolet is knocking on the door to retail sales leadership in this country," Ritter said. "We've gained market share on Ford in virtually every state in the union."
Ritter points out that the race between Chevrolet and Ford is even tighter if only retail sales -- which excludes generally less profitable sales to buyers such as car rental agencies and government and business fleets -- are counted.
From 1936 to 1987, Chevrolet beat Ford in U.S. sales every year except for three, and in two of those GM was crippled by strikes. But in 1988, with the success of the new Ford Taurus mid-size sedan and the Ford Explorer sport utility vehicle, the Ford division took the lead over Chevrolet and never looked back.
But in 2002, Chevrolet, on the strength of its truck sales, particularly its full-size and mid-size sport utility vehicles, gained market share while Ford sales fell 9.3 percent.
FORD HAS NEW MODELS TOO
Ford, however, has also unveiled several Ford brand cars and trucks at the Detroit show -- including the new Ford F-150 pickup, the top-selling vehicle in the United States, and a concept version of a forthcoming Mustang -- that it hopes will also boost sales.
GM is counting on more car sales to grow its Chevrolet brand in coming years.
"We've improved our share by making huge strides in trucks. Now we're trying to stem the erosion in cars," said GM Vice Chairman Bob Lutz.
While Chevrolet's truck sales have strengthened, its car sales have steadily fallen as its lineup has aged. Even though Chevrolet outsold Toyota by about 1.12 million vehicles in the United States by last year, the Toyota brand sold nearly 240,000 more cars than Chevrolet in 2002.
"I would consider Toyota our long-term greatest threat," Ritter said.
The Malibu sedan will be the first of the three new Chevrolets to go on sale, arriving in dealerships this summer. The Colorado mid-size pickup truck, a replacement for the S-10 pickup truck, will go into production late next year. Finally, the Equinox, about the same size as its sister vehicle the Saturn Vue sport utility, will go on sale in 2004.
GM executives acknowledge that one of their biggest hurdles to attracting new buyers will be the popular perception that they build inferior vehicles.
"In the past, many American cars have mostly been what I call...twenty-footers," Lutz said. "These are cars that look great from 20 feet (6 metres) away, but when you get to 20 inches (50 cm), you see less-than-perfect sheet metal, less-than-perfect rubber seals...boring interior, cheap-looking plastic, crooked seat seams..."
The quality and reliability of GM cars and trucks has improved considerably over the past few years, according to industry studies. But GM itself says that, despite the improvements, it still suffers from negative consumer perceptions.
"We are paying for sins of the past," Paul Ballew, GM's top market researcher, told reporters last month.
My first car was a 67 Mustang Coupe, 2nd one was a 67 Cougar XR-7, 3rd one was a 66 Mustang Coupe. Why did I get rid of these cars for ? I know why, because I'm stupid, stupid, stupid.
My next Ford.....