Auto Makers Turn to Sport Utility Pickups as SUV Market Saturates

As the demand for sport utility vehicles (SUVs) shows signs of slowing down, three major auto makers - Ford, General Motors (G.M.), and Nissan - are introducing a new class of vehicles called sport utility pickups. These vehicles combine the passenger compartment of a four-door SUV with a short, open truck bed in the back, offering consumers a compromise between the practicality of a pickup and the versatility of an SUV.

Key Takeaways:

• The Ford Explorer Sport Trac, to be launched in January, is a sport utility pickup that aims to appeal to consumers who want the versatility of an SUV but also need the carrying capacity of a pickup.
• General Motors and Nissan are also working on sport utility pickups, with G.M.'s Chevrolet, GMC, and Cadillac units planning to combine a Suburban SUV with a Silverado pickup, while Nissan will combine its Xterra SUV with a Frontier pickup.
• The market for sport utility pickups is expected to be small, with Ford planning to produce only a few thousand Lincoln Blackwoods, a niche vehicle that combines a Lincoln Navigator SUV with an F-150 pickup.
• Sport utility pickups will be regulated as light trucks, subject to more lenient fuel economy, pollution, safety, and tax rules than cars.
• The profit margins for sport utility pickups are expected to be high, potentially up to $15,000 per vehicle, similar to those for sport utility vehicles.
• The introduction of sport utility pickups is a sign that the light truck market is starting to resemble the car market, in which auto makers are forced to design dozens of vehicles to compete in smaller market niches.

Statistics:

• 21 new sport utility vehicle models will be reaching the market in the next year and a half, forcing auto makers to come up with new designs to differentiate themselves. (Source: Ford Motor Co.)
• Sport utility vehicles have become the lifeblood of the auto industry, with profits of $5,000 to $15,000 each due to high demand and cheap production costs. (Source: Auto Pacific Inc.)
• The auto industry hopes to charge the same markups on sport utility pickups as on sport utility vehicles, potentially improving profit margins. (Source: Ford Motor Co.)
• Ford will market the Sport Trac to men and women in their 30s with outdoor lifestyles, who want to be able to carry large objects in the back seat and bed. (Source: Ford Motor Co.)
• The Ford Explorer Sport Trac will combine two Ford vehicles that already share a common underbody, the Explorer SUV and the Ranger pickup, and will have a four and a half foot bed. (Source: Ford Motor Co.)

Sources:

• Ford Motor Co.
• General Motors Corporation
• Nissan Motor Company
• Auto Pacific Inc.
• Wieck Photo