Edmunds Solves The Mystery Of The Full-Size Pickup Sales Boom

Edward Niedermeyer
by Edward Niedermeyer

When we reported sales on Monday our conclusion was that “big is big again,” as full-sized pickups dominated growth in a surprisingly up month. So, how do you sell a ton of trucks in a month where gas was still hovering around the $3.50/gal mark? Easy: just throw some cash on the hood. Edmunds Autoobserver reports

From a low that generally occurred around April, Ford Motor Co., General Motors Co. and the Chrysler Group LLC have markedly hiked incentive spending on full-size pickups. In April, the average TCI for the full-size pickup category – which also inclaudes the almost statistically insignificant Toyota Tundra, Nissan Titan and Honda Ridgeline – was $3,261 per vehicle. At the end of September, the average incentive for full-size pickups ballooned by more than 30 percent to $4,281 per vehicle.

Executives from the Detroit automakers insist that this was not simply an inventory-clearing move (because, by industry standards, having three times your monthly sales on the lot is “acceptable”), but manufacturers have been trimming truck production all year and with Days To Turn rising, clearing off the lots makes sense. Especially going into the traditionally slow truck sales months of October and November. Hit the jump for more September incentive and transaction price data…

Edmunds gives the overall incentive crown to GM, but the biggest gains came from Honda which boosted spending from the previous month and year-over-year.

But if you express incentives as a percentage of transaction price, as TrueCar does, Chrysler is actually the bigger loser for September… which helps explain why it had one of the biggest volume jumps of the month.

Edward Niedermeyer
Edward Niedermeyer

More by Edward Niedermeyer

Join the conversation
4 of 10 comments
  • APaGttH APaGttH on Oct 06, 2011

    So based on Incentives/ATP GM and Toyota are hand-in-hand. I never, ever thought I would see that day. Oh, and Hyundai/Kia is in the incentive basement with Ford?!?! The world has gone nuts! ========================================================= I've becoming increasingly confused on what is "healthy" inventory levels. I've understood it to be that for non-niche vehicles that 60 to 75 days was ideal, under 45 days is tight, under 20 days is flying off the lots, and over 90 days is bloated. Is that still correct? I read lots of different arguments post-tsunami on what is a "healthy" level and seeing lots of arguments from some analysts and the B&B that 90 days is the new "healthy," which doesn't seem right to me. I seem to remember post-economic meltdown that "healthy" was closer to 45 days, and Honda/Toyota were the queen and king respectively at inventory management at those levels. Input from the TTAC gods appreciated.

  • SCE to AUX SCE to AUX on Oct 06, 2011

    I'm not understanding the mix of apples and oranges here, and I'm not sure the data supports the conclusion. According to the 2nd chart, incentives have actually dropped for C, F, GM, and N since last year. The only increases were between Aug and Sept of this year. The 3rd chart shows all incentives - not just for trucks - so I'm not sure what bearing it has on the truck market. Seems like this may just be a case of a rising tide lifting all boats.

  • Loser Loser on Oct 06, 2011

    "So, how do you sell a ton of trucks in a month where gas was still hovering around the $3.50/gal mark? Easy: just throw some cash on the hood" IMHO the biggest reason is that people have adjusted to or are now used to the price of gas. When gas first hit $3 a few years ago you would have thought it was the end of the world.

  • DenverMike DenverMike on Oct 07, 2011

    Clean older trucks get exported out of the US and get replaced by new. That doesn't happen with cars so much because they're common to the world and full-size trucks are unique to North & South Americas. Mexico is a huge 'drain' for 10-25 year old well equipped US trucks as theirs are usually beat to death base trucks. Only 10 year old cars can be imported into Mexico and that's a pretty narrow window compared to trucks. Notice the resale value of clean 20 year old trucks compared to say Camrys or Taurus'.