Automakers See Midsize Pickup Truck Sales Heat up

April 04, 2018 by Jerry Hirsch, @Jerryhirsch

After running flat last year, the midsize pickup truck market has suddenly become one of the hottest segments of the auto industry.

Sales of the smaller pickups rose 21 percent during the first quarter of this year compared with the same period a year ago.

Overall, U.S. auto sales rose 2 percent during the first quarter to 4.1 million vehicles, according to industry research firm Autodata Corp.

The Nissan Frontier, a model that hasn’t changed substantially since the current generation first went on sale in late 2004, spearheaded the gain in midsize pickup sales. Frontier sales rose nearly 47 percent to 22,825 in the first quarter.

The truck is doing well because it is smaller – easier to park and fit into a garage – and less expensive than its rivals, said Wendy Orthman, a Nissan spokeswoman.

The Frontier starts at $18,990. The Toyota Tacoma starts at $25,200 and the Chevrolet Colorado at $20,200.

But sales of newer models such as the Tacoma, the top-seller, and the Colorado, No. 2, also rose by double-digit percentages. Tacoma sales jumped 34 percent to 53,779. Colorado sales grew 29 percent to 28,859. Both the GMC Canyon and Honda Ridgeline experienced sales declines.

Toyota has made changes in its production footprint to ensure better supply of Tacomas and that has contributed to rising sales, said Stephanie Brinley, an analyst at IHS Markit.

Growth in the segment could also be a reaction to climbing prices for full-size pickups. Consumers are opting for smaller trucks, Brinley said.

The Toyota Tacoma

The Toyota Tacoma is the top-selling midsize pickup truck in the U.S. (Photo: Toyota)

Full-size pickup truck sales dipped 1 percent to 533,354 in the first quarter. Ford’s F-Series, Chevrolet Silverado, Toyota Tundra and Nissan Titan are all seeing gains of 4 percent to 13 percent. But sales of Ram pickup trucks and GMC’s Sierra — a sibling to the Silverado — are down by 13 percent and 19 percent respectively.

Torrid sales of smaller pickups from Toyota and Nissan also could be partially related to financial incentives from manufacturers, according to Dave Sullivan, an analyst with AutoPacific, an industry consulting firm.

“March is the last month of the fiscal year for the Japanese automakers,” Sullivan said. “There is plenty of cash out there to move the metal in March.”

Nissan’s truck is old and the tooling was paid off long ago, allowing the automaker to position its truck as the price leader in the segment, he said.

Honda’s Ridgeline generally gets favorable reviews, but with its front-wheel drive, unibody construction, it has a challenge attracting hard-core truck buyers. Most buyers lean to the traditional body-on-frame architecture of pickup trucks, Sullivan said.

Ridgeline sales plunged 28 percent to 7,005 vehicles so far this year.

“It’s time for them to fix the front styling so it doesn’t look like a minivan,” Sullivan said.

The hot market for smaller pickups is a turnaround from last year. Sales for the segment for all of 2017 rose just 1 percent to 452,335 trucks.

The rising tide could bode well for two pending midsize truck programs. Ford plans to bring back its Ranger pickup late this year after an eight-year absence from the U.S. market.

It will need a rising market to carve out space in the segment.

“It’s too early to make a call on the Ranger,” Sullivan said. “We’ll see some pent-up demand from Ford loyalists, but it remains to be seen how dealers handle the pressure to sell F-Series with Ranger’s new threat.”

Ford’s F-Series pickup line dominates the market. Sales of the big truck are up 4 percent from a year ago to 214,191 vehicles. The automaker is ahead of last year’s pace when it sold nearly 900,000 F-Series trucks for all of 2017. It is the best seller of any model vehicle in the U.S.

Volkswagen also will be looking closely at the midsize pickup truck numbers this year.

The German automaker’s U.S. unit unveiled its Atlas Tanoak Concept at the 2018 New York International Auto Show on Wednesday.

The vehicle is not currently slated for production, however Volkswagen said it will monitor public reaction as it ponders entering the U.S. pickup market. It would be built at the VW factory in Chattanooga, Tenn.

The Atlas Tanoak Concept is designed as a dual cab, five-seat configuration with a short bed. Its dimensions and unibody platform positions the Atlas Tanoak Concept as a midsize pickup akin to the Honda Ridgeline.

“VW would see sales a bit behind Honda on this front,” Brinley said.

Honda has a head start in the U.S. truck market with more dealerships and better recognition for the Ridgeline, Brinley said.

“The Atlas pickup, if it happens, will still be a niche product for the brand,” Sullivan said. “VW is tasked with filling capacity at their plant. I think the Atlas pickup is attractive, but Toyota owns the lifestyle pickup segment with the Tacoma.”

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