Newsflash: SUV Sales Drop

Like a hangover that drapes itself over your senses after a rowdy night, General Motors and Ford may be experiencing a little bit of a headache now that their summer-long Employee Pricing sales party is over. Especially when it comes to SUV sales, thanks to rising gas prices and the end of employee pricing incentives. While General Motors saw sales drop 24.2 percent in September and Ford lost 19.5 percent, light truck sales dived 30 percent for GM and 28 percent for Ford. This stands in stark contrast to import automakers such as Toyota, Nissan, and Honda, which enjoyed sales increases of 10.3 percent, 16.4 percent and 11.7 percent respectively. None of the Asian automakers took part in the Employee Pricing promotion, though DaimlerChrysler, which also offered car buyers employee prices, saw in increase of 3.7 percent, largely due to the success of popular models such as the Chrysler 300 and Dodge Charger. Honda's results for the month may well represent a shifting demand for smaller, fuel-efficient cars. Bolstered by an all-new model, sales for the Honda Civic jumped more than 30 percent, with Honda hybrid sales increasing 180 percent."The new 2006 Civic is off to a fantastic start and is already having a positive impact on our sales volume," said Richard Colliver, executive vice president of Honda sales. "With fuel prices at record levels, the timing is perfect for the introduction of a Civic that gets 40 miles per gallon." For car shoppers, the news signals that GM and Ford may be shifting focus to fuel economy, including hybrids and new engine technology, such as variable cylinder activation. Ford, which now sells the Escape Hybrid and is in the process of building a hybrid version of its new mid-sized sedan, the 2006 Fusion, recently announced plans to offer more than half of its vehicles with hybrid powertrains by 2010. And late last week, Bob Lutz, General Motors vice chairman, said that GM would energize its drive to build hybrid vehicles, but that its first true hybrid full-size SUV would still debut in 2007. General Motors is also banking on improved fuel economy from its redesigned lineup of full-size SUVs, thanks in part to Displacement-on-Demand, an engine technology that deactivates cylinders as power requirements are reduced.