1st Gear: Pickup Buyers Are Fed Up With ‘Overpriced’ $50,000 Trucks
For a hot minute now the average new car price has been about $34,000, a historic high in the industry. But if you want a truck, it’s even more—almost $50,000. That’s a lot for a segment that used to offer almost exclusively utilitarian work vehicles but now trades in gigantic, leather-lined near-luxury vehicles full of expensive features.
Those trucks are incredibly lucrative. The American automakers in particular have essentially become truck and SUV manufacturers that occasionally make sedans and cars as a side hustle, if at all. The key is profit margins—you take a basic truck and turn it into a King Ranch or Sierra Denali or whatever, pile on the options and watch your money stack higher and higher.
Buyers are getting sick of it, and they don’t feel like their trucks are even that well-built anymore, according to a CarGurus study—the very officially titled “2019 Truck Sentiment Survey”—reported on by the Detroit Free Press:
With the average transaction price for a new full-size truck near $50,000, the expense of buying and maintaining a pickup are pushing some pickup owners into other vehicles. The survey found that only about 15 percent of current pickup owners say the vehicles are a good value.
CarGurus, an online automotive marketplace that connects buyers and sellers of new and used cars, surveyed 1,067 current and former pickup owners last month, the split being about 50/50. Among the current owners, 195 own a Ford pickup, 154 own a Chevrolet pickup, 106 own a Toyota and 101 own a Ram.
The survey found that 68 percent of pickup owners said their vehicles were overpriced. Forty-eight percent said the trucks aren’t made as well as they used to be and 17 percent said they probably will not buy another pickup.
Interestingly—and I’m convinced this isn’t a huge phenomenon yet but it could be later—some buyers are so fed up with truck prices they’re actually moving back into sedans:
Among the former pickup owners who switched to another type of vehicle, 37 percent now own a traditional SUV or crossover and 35 percent now own a sedan, the survey said.
“What an interest finding in that study,” Gross said. “What we see as the top reasons people are switching categories is that trucks have poor fuel efficiency and they’re high cost. Switching into a large SUV might not make as much sense as a sedan.”
Nearly half of current pickup owners, 47 percent, cited “gas mileage” as a reason for considering another brand of pickup, up from 38 percent in the year-ago study. Nearly 42 percent of former pickup owners said fuel efficiency was a top reason for abandoning pickups for a different vehicle.
“It speaks to gas mileage and fuel efficiency being top of mind to car buyers overall right now,” said Gross.
Also worth noting these ridiculously high transaction prices were driven by cheap and readily available credit, and that certainly won’t last forever.