Crunching The Numbers: Is 2008 Going To Be The Year Of The Underdog?

When the average person compares companies like Toyota to the Detroit Big 3 some the defining attributes that come to mind are dependability, resale and quality.  I think most anyone can agree these are things at least that Toyota and other have generally done well in these areas and this should always give them the edge in sales.  Toyota in general is well known for analyzing the Big 3’s marketing successes and targeting them where it counts in each category.   Just take a look at sales over the last decade and I believe it will prove to even the skeptic that Toyota is a worthy adversary for the Big 3 in every way.

 But has is it working for Toyota or is there a critical flaw in the strategy? Have they emulated the Big 3 too well?  Let’s take a look a look at the sales figures for the Toyota, the Big 3 this year.  In order to be fair and compare apples to apple we will strip out Cadillac, Lincoln, Ford’s Premium Auto Group, and Lexus from the totals.

  
 As we can see it is a pretty ugly picture for the year.  The Detroit brands are all poorly positioned in the market place and suffer accordingly.  Toyota is down a bit over 3.5% on the year and they chalk it up to buyers simply not in the market place. However only losing 3.5% in this market may be considered pretty darn good.  Specializing in hybrids hasn’t hurt Toyota in any respect here.

 Will Cloning a Proven Leader Work?

 If you look at the market, Hyundai has been following the playbook that Toyota wrote 20 years almost play by play.  In doing so, they have seen a dramatic shift in public perception and have made significant gains in the market place share.  Their lineup in many ways mirrors that of Toyota, trying to capture some of this leader’s glory. So how have they faired in 2008 so far?

 Let’s take a look:

Wow! amazingly close to Toyota’s performance percentage wise, not horrible in the overall perspective but still not the best.  But how are they doing this without the hybrid advantage?

 Is Different Better?

 Now we come to the brands that beat to a different drummer.  While many of these share similar models to our previously mentioned makers, they are arguably market to the buyer that refuses to be generic.  Now if you remember, Toyota and others are claiming that the buyers simply aren’t flocking into the showrooms, so sales are down.  But is this true across the board as we have been led to believe?   You tell me?

Now by looking at these figures there are obviously buyers out there. But they for some reason aren’t choosing their purchases from the mainline makers stock pile of wares.  Why?  Is it due to their core demographic, refuses to fit in with the mainstream?  Or do these makers simply know something the others don’t?  It might even be argued that these 6 makers may simply offer cars that are more fun to drive, or make a statement.  Anyway you look at it, these guys, aren’t complaining about showroom traffic. They are profiting from their superior positioning.

How About The Luxury Market?

In a bad economy, many cut back on the luxury items, so you would think that the losses would be severe. This may ring true especially for the brands that lack the clout of the leaders. But is this true?

I guess you could pretty easily predict Land Rovers predicament.  As with Lincoln, gas guzzlers aren’t really the rage right now.  Acura and Volvo are simply missing the target; however Acura is showing signs of progress with the latest crossover releases. Now I would have expected Lexus to be stronger here with a full line of hybrids, however this positioning has failed to bear fruit for the brand.  Why? Actually they have lost the most sales of anyone in shear numbers. Cadillac and BMW obviously are hurting a bit, but I see both of these brands picking up steam by the end of the year the new CTS and BMWs upcoming releases will all have time to come into play. Audi, Infiniti, and Jaguar are all in flux with slightly depressed sales, however all of these brands should accelerate forward with either a plethora of releases slated, or new models picking up steam.  Who would of thought Audi could have come this far, this fast?

Now with all of this bad news, just how did Mercedes Benz actually show an increase?  The all new C-Class played a large part of this in overall sales.  But I suspect that real key here is the fact that Mercedes core client is simply less prone to economic bumps in the road.  After all, they say, “old money” tends to ride the tide in style far better than “new money”. 

So take a look and tell me what you see in these figures, and why. 

Have the mainline makers lost a critical edge?

Are we on a cusp of a change, and the smaller makers have simply positioned themselves better?

What if gasoline moves to $6.00 a gallon?

Have fun!