Non-Detroit Three Automakers Already Sell More Cars in North America, and Soon They'll Make More
Detroit’s dominance in the domestic automotive sphere continues to erode. Whereas the manufacturing hub, home to Ford, General Motors, and Fiat Chrysler Automobiles, once churned out the bulk of vehicles built — and sold — in the United States, times have changed.
The former Big Three automakers no longer hold the majority market share in the U.S. (in 2016 it was 44.9 percent), necessitating a name demotion to “Detroit Three.” From Silicon Valley to the Midwest and South, a diverse group of automakers is busily assembling cars and SUVs for a population with very wide-ranging tastes. We’ve long since become used to the idea that many Hyundais now hail from Alabama, several Subarus come from Indiana, Honda models grow in Ohio, and BMWs arrive from South Carolina with a Southern drawl.
Now, one industry watcher claims the Detroit Three won’t even finish the year as the majority builder of North American-made vehicles.
According to IHS Markit, Detroit will soon hand over the crown to its domestic and foreign rivals, Bloomberg reports.
In a briefing held today on the outskirts of that city, IHS Markit analyst Joe Langley predicted a total of 8.6 million vehicles produced in North America by Ford, GM, and FCA in 2017, just a hair below the 8.7 million vehicles forecasted for all other manufacturers. The rival group includes Tesla, as well as German, Japanese, and Korean automakers.
With several automakers — Toyota, Mercedes-Ben z, and Volvo, for example — announcing production expansions in just the past week, the gap will only grow after this year’s anticipated turning point. It’s truly Detroit vs. Everybody, and everybody’s winning. By 2024, IHS Markit seed the Detroit Three building 8.1 million vehicles in North America, compared to 9.8 million units assembled by the competition.
It’s been a long time coming. After the disappearance of such automakers as Studebaker, Packard, and Kaiser in the 1950s and ’60s, as well as the purchase of AMC by Chrysler in the 1980s, Detroit’s production dominance soon sprouted cracks. Japanese manufacturers arrived on masse in the ’80s, setting up shop in states unfriendly to the United Auto Workers. The Germans and Koreans eventually followed.
Since the recession, all three Detroit automakers have begun looking outward for opportunities, hoping to gain market share outside North America’s borders. At the same time, the number of models sent to Mexico for low-cost production has increased, all in the interest of profitability.
Unfortunately for the Detroit Three, Mexico has also welcomed other manufacturers with open arms.
[Image: Bryan Debus/ Flickr]
Join the conversation
Latest Car ReviewsRead more
Latest Product ReviewsRead more
- Keith Maybe my market's different. but 4.5k whack. Plus mods like his are just donations for the next owner. I'd consider driving it as a fun but practical yet disposable work/airport car if it was priced right. Some VAG's (yep, even Audis) are capable, long lasting reliable cars despite what the haters preach. I can't lie I've done the same as this guy: I had a decently clean 4 Runner V8 with about the same miles- I put it up for sale around the same price as the lower mile examples. I heard crickets chirp until I dropped the price. Folks just don't want NYC cab miles.
- Max So GM will be making TESLAS in the future. YEA They really shouldn’t be taking cues from Elon musk. Tesla is just about to be over.
- Malcolm It's not that commenters attack Tesla, musk has brought it on the company. The delivery of the first semi was half loaded in 70 degree weather hauling potato chips for frito lay. No company underutilizes their loads like this. Musk shouted at the world "look at us". Freightliners e-cascads has been delivering loads for 6-8 months before Tesla delivered one semi. What commenters are asking "What's the actual usable range when in say Leadville when its blowing snow and -20F outside with a full trailer?
- Funky D I despise Google for a whole host of reasons. So why on earth would I willing spend a large amount of $ on a car that will force Google spyware on me.The only connectivity to the world I will put up with is through my phone, which at least gives me the option of turning it off or disconnecting it from the car should I choose to.No CarPlay, no sale.
- William I think it's important to understand the factors that made GM as big as it once was and would like to be today. Let's roll back to 1965, or even before that. GM was the biggest of the Big Three. It's main competition was Ford and Chrysler, as well as it's own 5 brands competing with themselves. The import competition was all but non existent. Volkswagen was the most popular imported cars at the time. So GM had its successful 5 brands, and very little competition compared to today's market. GM was big, huge in fact. It was diversified into many other lines of business, from trains to information data processing (EDS). Again GM was huge. But being huge didn't make it better. There are many examples of GM not building the best cars they could, it's no surprise that they were building cars to maximize their profits, not to be the best built cars on the road, the closest brand to achieve that status was Cadillac. Anyone who owned a Cadillac knew it could have been a much higher level of quality than it was. It had a higher level of engineering and design features compared to it's competition. But as my Godfather used to say "how good is good?" Being as good as your competitors, isn't being as good as you could be. So, today GM does not hold 50% of the automotive market as it once did, and because of a multitude of reasons it never will again. No matter how much it improves it's quality, market value and dealer network, based on competition alone it can't have a 50% market share again. It has only 3 of its original 5 brands, and there are too many strong competitors taking pieces of the market share. So that says it's playing in a different game, therfore there's a whole new normal to use as a baseline than before. GM has to continue downsizing to fit into today's market. It can still be big, but in a different game and scale. The new normal will never be the same scale it once was as compared to the now "worlds" automotive industry. Just like how the US railroad industry had to reinvent its self to meet the changing transportation industry, and IBM has had to reinvent its self to play in the ever changing Information Technology industry it finds it's self in. IBM was once the industry leader, now it has to scale it's self down to remain in the industry it created. GM is in the same place that the railroads, IBM and other big companies like AT&T and Standard Oil have found themselves in. It seems like being the industry leader is always followed by having to reinvent it's self to just remain viable. It's part of the business cycle. GM, it's time you accept your fate, not dead, but not huge either.
I couldn't care any less about who makes cars in North America or in what quantity. I do care about who makes cars in the United States of America. Lets see those numbers, and only those numbers. I suspect it will just go to show the UAW three to be even further behind other US employers.
Just for perspective: GM, at its peak, had something approaching 50% market share.