Farmer Knows Best: Pickup sales boosted by booming agrarian economy?
10-24-10, 08:45 PM
#1
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Farmer Knows Best: Pickup sales boosted by booming agrarian economy?
http://www.autoblog.com/2010/10/24/f...agrarian-econ/
Through the first nine months of 2010, the auto industry is on pace to increase sales by 10 percent versus 2009, and pickup trucks are leading the charge. Bloomberg reports that bedded haulers are up 14 percent on the year, led by increased demand from the farming industry. Farmers have seen their revenues increase by $9 billion over last year, with both prices and demand rising in part because of droughts in Russia and Canada. Farmers are using their new-found dollars to invest in their businesses, and trucks are among the biggest and best tools in the box barn.
Automakers are beneficiaries of this investment, as truck sales climb and profits soar. Analyst Joe Barker of IHS Automotive claims that automakers can make up to $15,000 on each pickup sold, a figure that holds firmest when incentives are down. And with sales up, incentives have dipped. Edmunds shows that trucks have an average MSRP of $34,235, or about $2,000 higher than in 2009. Supply and demand really does work.
The biggest recipient of the increased demand for pickups has so far been Ford, which has seen its F-Series pickups jump by 31 percent. Chevy Silverado sales are up 17 percent as well. Even the Toyota Tundra, which has struggled in the U.S. market, is up 21 percent. The Ram appears to be the only truck suffering through the pickup truck boom, with sales down one percent year-over-year.
Automakers are beneficiaries of this investment, as truck sales climb and profits soar. Analyst Joe Barker of IHS Automotive claims that automakers can make up to $15,000 on each pickup sold, a figure that holds firmest when incentives are down. And with sales up, incentives have dipped. Edmunds shows that trucks have an average MSRP of $34,235, or about $2,000 higher than in 2009. Supply and demand really does work.
The biggest recipient of the increased demand for pickups has so far been Ford, which has seen its F-Series pickups jump by 31 percent. Chevy Silverado sales are up 17 percent as well. Even the Toyota Tundra, which has struggled in the U.S. market, is up 21 percent. The Ram appears to be the only truck suffering through the pickup truck boom, with sales down one percent year-over-year.
10-25-10, 06:34 AM
#3
Lexus Test Driver
10-25-10, 07:47 AM
#5
Farmers, like other businesses, postpone equipment replacement when earnings are down and accelerate their replacement schedules when earnings are flush. My brother-in-law who farms does this with his tractors and work trucks. Workers at Ford facilities used to joke that they could tell if they were going to have a good year - their building got a new roof or other major maintenance even if it wasn't yet needed.
10-25-10, 10:23 AM
#6
Out of Warranty
Pickups are not just a part of Texian culture, many actually work for a living here, not just on farms and ranches, but also in fleet service for companies large and small. Fleet operators learned quickly that the 3/4-ton variety are far more rugged than their 1/2-ton cousins - particularly in the areas that count, bearings, transmissions, suspension, brakes, etc. They claim that the half-ton variety are basically passenger cars with a body kit, and do not stand up well to moderately heavy loads, high mileage, or offroad applications. The difference in cost (at least for a fleet truck) is $4K or $5K, but includes a V8, a considerably heavier suspension, driveline, and features not offered on the price-leading V6 half-tons. Depending on miles driven, a 3/4-ton may be the better investment, simply based on toughness and longevity.
I owned two 3/4-ton Suburbans over the years, and found them for the most part reliable - my first had overlooked the dielectric grease on the 12v connections to the steering column that resulted in a dozen odd maladies until spotted by an observant (independent) mechanic. Hundreds of thousands of miles, with moderately heavy loads, occasionally towing trailers from four to eight thousand pounds, never seemed to give them pause, whether in urban or highway environments. Friends with half-ton models seemed to have more problems - if they utilized their SUV's in similar service.
If you are a homeowner who uses a pickup primarily for weekend hauling projects or a second car, the half-ton is plenty adequate, and will save both on purchase and operating cost. In fact, they make a pretty nice alternative to a similarly-priced mid-size sedan, provided you don't need the passenger space. Crew or extended cabs get kinda pricey. I'm mystified by the macho "big rig" drivers who own a one-ton dually diesel, but the bed is not even scratched. It's strictly an "image" thing. For the same money they could be driving a luxury car that would be considerably more comfortable and offer a good deal more performance. Of course, they wouldn't get nearly as much respect down at the ice house or local honky-tonk.
I owned two 3/4-ton Suburbans over the years, and found them for the most part reliable - my first had overlooked the dielectric grease on the 12v connections to the steering column that resulted in a dozen odd maladies until spotted by an observant (independent) mechanic. Hundreds of thousands of miles, with moderately heavy loads, occasionally towing trailers from four to eight thousand pounds, never seemed to give them pause, whether in urban or highway environments. Friends with half-ton models seemed to have more problems - if they utilized their SUV's in similar service.
If you are a homeowner who uses a pickup primarily for weekend hauling projects or a second car, the half-ton is plenty adequate, and will save both on purchase and operating cost. In fact, they make a pretty nice alternative to a similarly-priced mid-size sedan, provided you don't need the passenger space. Crew or extended cabs get kinda pricey. I'm mystified by the macho "big rig" drivers who own a one-ton dually diesel, but the bed is not even scratched. It's strictly an "image" thing. For the same money they could be driving a luxury car that would be considerably more comfortable and offer a good deal more performance. Of course, they wouldn't get nearly as much respect down at the ice house or local honky-tonk.
Last edited by Lil4X; 10-25-10 at 11:17 AM.
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