Track the companies that matter to you. It's FREE! Click one of these fan favorites to get started: Apple; Google; Ford.



Is the 2014 Chevy Silverado a Failure?

Sales of the 2014 Chevy Silverado have been down in recent months. Photo credit: General Motors.

The numbers sure looked brutal for General Motors (NYSE: GM  ) : While Chrysler's Ram pickups posted a 22% sales gain in January, and sales of Ford's (NYSE: F  ) F-Series were basically flat, sales of GM's Chevy Silverado dropped 18.4% on the month.

That followed a big decline in December. Chevy Silverado sales were down 16% in the last month of 2013, while Ford managed an 8.4% gain.

That sure looks terrible for GM, doesn't it?

It looks even more awful than you might think, because GM's pickups were all-new last year, while Ford's are an older model that is set to be replaced at the end of this year. If GM's new pickups can't compete with Ford's old ones, that's a problem, isn't it?

So here's the big question: Are GM's new Chevrolet Silverado and GMC Sierra pickups turning out to be busts?

Actually, GM isn't doing badly
It's easy to make that argument as long as you don't look too hard at the numbers. But the truth isn't that simple. To help us dig deeper into the numbers, I reached out to senior analyst Jessica Caldwell, and Edmunds' big database of sales and pricing figures.

For starters, Caldwell pointed out that the Silverado 1500 had 17.4% of the light-truck market in January -- which is about what it had last March. These figures go up and down a bit over time as automakers change their incentives programs, but in her view, GM's share of pickup sales hasn't really changed much over the last couple of years. 

There's more evidence to suggest that GM's pickups are selling at a relatively brisk pace. "Days to turn" is an industry measure of how long (on average) a model sits on dealer lots before being sold. Days to turn for the Silverado in January were 78, versus 80 for Chrysler's Ram 1500 and 83 for Ford's F-150 -- and just 62 for the Sierra.

Caldwell also noted that GM's pickups have a larger percentage of "cash" buyers than the others, rather than buyers who are financed at the dealer or who choose to lease. That suggests that GM's buyers have relatively strong credit, and that they might be choosing more expensive, and more profitable, trucks.

That's consistent with what we've heard elsewhere. GM said in a statement early in February that half of its light-duty pickup sales in the fourth quarter sold for $40,000 or more. Those are seriously profitable pickup sales for GM, and a sign that its strategy -- pursuing more profitable sales, even at the expense of total sales numbers -- may be paying off.

So why do GM's sales look so bad?
So why the seeming ugliness in GM's sales numbers? Part of it is just a tough comparison: A year ago, GM had a big inventory of its last-generation Silverados and Sierras, and it needed to sell them off to make room for the all-new trucks that were set to roll out later in the year. 

That meant that GM's discounts were huge, and that drove up its sales numbers. Edmunds' data shows that GM's incentive spending per truck topped $6,000 on the Silverado 1500 last February, and was more than $5,000 in the first seven months of the year.

But that changed once GM's all-new trucks started arriving at dealers. Last month, incentives on the Silverado 1500 were down to $3,764 per truck -- lower than both Ford's ($3,925) and Chrysler's ($4,233). Incentives on the GMC Sierra -- a premium truck that tends to sell at higher average prices -- were even lower, at $3,521.

Long story short: GM's year-over-year sales are down in part because GM was running a big sale on its old trucks a year ago that boosted its total sales numbers.

I thought pickup buyers were loyal. Why do incentives matter?
Retail pickup buyers tend to be pretty brand loyal. A big discount from their preferred brand might get them to trade in sooner, but relatively few Ford buyers will trade in their old trucks on a new Chevy just to save a few hundred bucks, or vice versa.

Things are different when it comes to small fleet buyers, though. A contracting company looking for 10 new work trucks might care a lot more about price than about the brand name on the tailgate. For those buyers, incentives can make a big difference, and those kinds of buyers buy a lot of pickups.

As Caldwell pointed out, Ford's incentives on the F-150 started to rise just as GM's new pickups were arriving at dealers last summer. With a model at the end of its life cycle, Ford can afford to pay a little more per truck to keep sales strong -- it's still making plenty of profit on each sale. 

That has helped Ford's numbers look good.

GM is probably making a lot more money per truck, and more money overall
But GM's numbers don't necessarily look bad. GM's incentives are a lot lower than they were at this time last year, and its sales are a bit lower. Lower incentives mean more profits per truck sold.

But its percentage of the overall pickup market is in line with historical trends, and there's some good evidence that GM is making more profit per truck sold.

On balance, that sounds like a win for GM, not a failure. In fact, it sounds like GM's plan is working out pretty well.

The General's profit in North America was quite strong last quarter, at $1.88 billion. That came despite subdued-looking pickup sales. If that strength continues in the first quarter of 2014, I'll continue to be inclined to think that whatever GM is doing seems to be working.

How to invest in the next big thing -- explained by The Motley Fool
Let's face it, every investor wants to get in on revolutionary ideas before they hit it big. Like buying PC-maker Dell in the late 1980's, before the consumer computing boom. Or purchasing stock in e-commerce pioneer in late 1990's, when they were nothing more than an upstart online bookstore. The problem is, most investors don't understand the key to investing in hyper-growth markets. The real trick is to find a small-cap "pure-play", and then watch as it grows in EXPLOSIVE lock-step with it's industry. Our expert team of equity analysts has identified 1 stock that's poised to produce rocket-ship returns with the next $14.4 TRILLION industry. Click here to get the full story in this eye-opening report.

Read/Post Comments (39) | Recommend This Article (9)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On February 16, 2014, at 10:58 AM, Jackson100Furst wrote:

    I recently purchased a 2014 GMC Sierra. I was going to buy the Silverado, but after looking at the much better designed GMC Sierra, the Silverado seemed like a poor man's Sierra. I think where GM made the mistake is not redesigning the Silverado to the extent that they did with the Sierra so that they could compete on the same level. The Sierra exceeds the Silverado on everything from paint and interior combinations to dashboard design, to technology.

    Having said that, I am extremely thrilled with my new Sierra -- couldn't be happier with it -- and it's actually getting a few miles better mileage than my gas guzzling 2012 Avalanche got.

  • Report this Comment On February 16, 2014, at 11:01 AM, sljons wrote:

    The answer would be to create a new body style that would appeal to the younger generation. The current body style is just too square,create a truck that would grab the attention of the younger generation with a more streamline design and a little more affordable to them....

  • Report this Comment On February 16, 2014, at 11:12 AM, Justfocus wrote:

    The variable cylinder management engine is a disaster. It is a ugly truck, It is built by Government Motors who has not paid us back all the money (Thanks to the Big 0) So why in the heck would any American buy this junk? Oh I know you are saying they did pay it all back, well go do your home work and find out the truth.

  • Report this Comment On February 16, 2014, at 11:37 AM, VegasSmitty wrote:

    The MF is a failure!

  • Report this Comment On February 16, 2014, at 11:54 AM, EuSnake wrote:

    How many times do I have to repeat (are you GM designers listening?): The truck doesn't have a WOW factor! Design a beautiful car and I will buy it. Start with the wheel wells - the most obvious obnoxious design flaw. Then get rid of the old farts who seem to be still around making the final design decisions!

  • Report this Comment On February 16, 2014, at 12:26 PM, sporky wrote:

    Like the article said, its not all bad news. GM trucks tend to be higher priced more profitable ones. But to some degree GM is pricing itself out of the market for future generations. It does tend to be an "old fart" truck judging from those I see driving a lot of them. That's fine, old farts tend to have more money to spend on these vehicles. But the tendency towards brand loyalty in the pickup market means GM may find themselves out of luck down the road when Ford and Ram have won over so many younger buyers today. Buyers who are willing to buy based more on value and less on old fashioned notions about what is and is not a good truck. I personally don't see why GM trucks continue to command a premium.

  • Report this Comment On February 16, 2014, at 1:08 PM, Kmanc4s wrote:

    I purchased a 2014 Chevy Silverado in the Fall and am extremely pleased with the truck. The GMC Sierra is identical other than minor styling differences with both having excellent build quality.

    I looked at the Ram. It seems to be a good truck, but when I asked Ram owners what they thought of their trucks, with exception they all said the were great trucks other than transmissions and rear ends failing prematurely.

    The interior styling of the Ford was not appealing to me and they've not been without their problems.

  • Report this Comment On February 16, 2014, at 1:41 PM, Jason87467 wrote:

    Ford truck ads sounds convincing that they build the best truck, but in reality they don't. If you look at the facts, you will find GM build better trucks. Consumer Reports rates the Ford F150 third behind the Ram with GM being first. Also, Edmonds says vehicles with high power small block will not last as long as a non-turbo engine. That's not too hard to figure out. More stress on two less piston puts more load on the remaining pistons. A turbo is also a delicate unit which spins up to 20,000 RPM's and is more likely to cause problems with a high mileage engine. That's probably why GM did not go that route. GM has a V8 truck engine that gets better gas mileage then the Ford much touted V6 Ecoboost. To me, that means Ford will be in for a rude awakening when their EcoBoost engine starts getting high mileage.

    I'll stick Chevy's

  • Report this Comment On February 16, 2014, at 1:52 PM, whateva wrote:

    My parents looked at the Sierra and the Silverado....they are VERY similar besides a few little things that the Sierra had over the Silverado. Were those things worth the extra 10k? No. Someone REALLY superficial says things like its the poor mans Sierra, but my parents pay for everything in cash so they couldn't justify an extra 10k for mirrors that folded in with the push of a button and a lift kit. But they do love their new Chevy! They keep saying how quiet it is compared to their last truck!

  • Report this Comment On February 16, 2014, at 2:51 PM, JamesUSA wrote:

    They have gotten so political at this point I would buy a car made by Al-Qaeda before I would buy one made by Government Motors.

  • Report this Comment On February 16, 2014, at 3:33 PM, chevysucks wrote:

    My father and mother were GM employee's for years. Does anyone think it is not right to cut pensions for those who dedicated years as a engineer for them. Still closing down plants and cutting jobs. Not to mention the 11 BILLION they stole from the American public. Keeping their monster pvt planes in the air and giving huge bonuses to all the executives. Furthermore GM is NOT the #1 car company. The new trucks don't look much different from last year. They alraedy have a major recall. TRUTH IS TRUTH. My family are FORD buyers now. Why do you think the most popular car among police and fire were the Crown Vic? DEPENDABLE! GM has to give them to the Gov. to get them to use them.

  • Report this Comment On February 16, 2014, at 3:55 PM, SkepikI wrote:

    JR- a useful and clear article for baseline on tracking Pickup competition as F closes out its old model and gets ready to launch its new design. I strongly encourage you to track this and report with similarly well written articles over the next year? 20 months?

    This is a subject I am very interested in, and find compelling because of the effect this sector has on F and GM profitability. It won't change my opinion or aversion to GM, but it might affect how much F I hold for long term. Please keep up the good work, and the value for your readers.

    Long F, the taxpayer's friend.

  • Report this Comment On February 16, 2014, at 4:35 PM, speedntj wrote:


    Your post isn't exactly true. Chevy did away with the rear wheel drive impala and that's when the Crown Vic sold more to the Police. The Police buy and EVEN amount from all three automakers. That's policy.

  • Report this Comment On February 16, 2014, at 4:38 PM, speedntj wrote:

    The reason Chevy sales are down is because it's ugly. The square wheel wells are horrible. I used to be a die hard Chevy guy until I saw the new Silverado. that made me buy a 2014 RAM 1500. Sorry Chevy but your just too ugly for me!

  • Report this Comment On February 16, 2014, at 6:15 PM, bluegrasssboy wrote:

    Having been a car salesman for a number of years and constantly being in and out of a lot of new trucks.....I can vouch the new 2014 GM trucks are some of the nicest trucks you can buy right now. While the design wasn't a complete wholesale change over the 2013 truck, everything is all new, nothing is the same. It's a much smoother, quieter truck over the previous generation. It should cost more than the old truck because it is a lot nicer. If you could buy the 14 truck for the same price that people bought the 13 for last year, all those people would have a perfect right to be pissed off.

  • Report this Comment On February 16, 2014, at 6:22 PM, bluegrasssboy wrote:

    The Ford Ecoboost does get the advertised MPG UNTIL you get into the turbo. Start using the truck as a truck, actually making the motor work and using the turbo and the numbers fall away, That motor is also a repurposed car engine. The GM 4.3 V^, while, sounding to most folks like the same old 4.3 they've been using since El Caminos were sold, is in fact an all new engine, with almost 300hp designed from the start to be used in a truck.

  • Report this Comment On February 16, 2014, at 6:39 PM, thrill333 wrote:

    The reason they're not selling is because theyre $40,000-$50,000! The average working person cannot afford that for a vehicle unless they buy the LS version which is really just a work truck. If you want the LT or the LTZ versions you're definitely gonna pay for it. Until car makers realize that the average family can't afford these prices they're never gonna sell.

  • Report this Comment On February 16, 2014, at 7:54 PM, mrgreenjeans wrote:

    GM's pickups are ugly full of defects and overpriced surprised they have done as well as they have

  • Report this Comment On February 16, 2014, at 8:18 PM, guysisson wrote:

    Drive a new F-150 and you will see right away why Ford is outselling GM 2-1 in pickup sales. The proof is in the numbers. The new Silverado is a complete failure. It is probably the ugliest truck ever produced, it looks like something from the early 80's, and is very cheaply built. Wait till this fall when the new F-150 is out, the sales will probably be 3-1 in favor of Ford.

  • Report this Comment On February 16, 2014, at 8:39 PM, thatonedude1 wrote:

    Anybody notice that the fool makes a constant habit of trashing GM and touting Ford? It's never ending. While they make some valid points, they never find the time to post a good article about a company that has made a great comeback and has numerous great products.

  • Report this Comment On February 16, 2014, at 8:43 PM, jimatmad wrote:

    1. Motley always has the worst auto stories ever written. Not one of their writers has a clue.

    2. Their stories always are promoting some other agenda than actually writing about cars and trucks.

  • Report this Comment On February 16, 2014, at 9:08 PM, captainslushy wrote:

    GM needs to put a diesel motor in their 1/2 ton trucks. The re-design needs a re-design. If they want to appeal to the younger market they need to lower the price of luxury or make an appealing product that younger buyers don't need to spend 50k on for a truck.

    Try and buy a GM vehicle used or otherwise. They hold their value.

  • Report this Comment On February 16, 2014, at 10:05 PM, jcdadeo wrote:

    what a country,over priced , unused wastefull resourses, that most trucks, that their total usefullness is to go to the flea market and never have anything loaded into the bed, priced at prices many times the worth. they are suposed to be trucks that are for hard work, not blasting thru interstate roads by beared high school drop outs trying to impress something, no wonder this country is inthe condition

  • Report this Comment On February 16, 2014, at 10:10 PM, TimFeatherston wrote:

    Consumer reports has been bought out by the White House. ever since the buy out they have been raving about GM's vehicles, yet all the other car mags say that the quality is still not there. One of Chevy's biggest problems is their dealers. . They are higher priced and less willing to negotiate, they give less for trade ins and are more arrogant in general

  • Report this Comment On February 16, 2014, at 10:20 PM, madokie wrote:

    people are buying real estate, not 50,000$ buy is a 2 year old vehicle in great shape.!!!!

  • Report this Comment On February 17, 2014, at 7:14 AM, JamesM1947 wrote:

    Gay Advertisement is not helping GM.

  • Report this Comment On February 17, 2014, at 7:28 AM, RandiRN wrote:

    I am not surprised that GM isn't selling their new trucks. They just haven't caught the public's eye. The last few years GM made numerous mistakes. Look at what they did with the Malibu. The Malibu was a horrible vehicle from a design standpoint, and the "redesigned" vehicle isn't much better. GM needs to change their corporate philosophy.

  • Report this Comment On February 17, 2014, at 7:29 AM, PS75425 wrote:

    #1 reason: Too expensive (i recall when trucks were reasonably priced)

    #2 reason: I am not convinced all truck buyers want a truck that's a car, some of us just want a truck (for utility)

    #3 Although the V8s are great motors, they don't give the appearance of being "hi-tech" (e.g. Ford's EcoBoost with "twin turbos" .... yeah but wait till they have to repair those "twin turbos" ...yikes that'll leave a mark)

  • Report this Comment On February 17, 2014, at 8:40 AM, titanguy1978 wrote:

    First off, looks are subjective. I personally like the look of the truck. I've owned two trucks since 2007 and they have both been Nissan Titan's, which are highly underrated. I had a 2007 LE and now a 2013 SV Premium. I know this isn't a Titan topic but i think Ford. Chevy and Dodge need to watch out for the 2015 Titan Diesel with around 300hp and 560tq, this thing is going to be the most power truck ever built in this class of trucks. The rumor is around combined 24-25MPG. The only engine they offer now is a 317hp/385tq 5.6L V8 which gets a crumby 14MPG, but is still a really good engine compared to what you get with a baseline engine from Ford Chevy or Dodge.

    AS far as the Silverado goes, I would love to have one but they are just a little too expensive for what you get. I got my 2013 Titan Crew Cab 4x4 SV with premium packages for $36,000 after incentives, blue tooth, rear back up camera, hydrolic lift gate, rear power sliding window, Rockford Fosgate system, Spray bedliner, side steps, built in tool box, utlitrac system, trailer package etc. etc...i'd be around $44,000 in a Silverado with similar options i have in my Titan WITH incentives. That's an $8000 difference.

  • Report this Comment On February 17, 2014, at 10:31 AM, jfelano wrote:

    Umm...GM has paid the money back, your just uninformed, and FORD hasn't, and they are 100 billion in debt.

    Seems half of you failed to read the WHOLE article.

  • Report this Comment On February 17, 2014, at 12:09 PM, mikel1958 wrote:

    How about service after the sale.I just bought a Ford F 250 because the way I was treated by the dealership that took care of my Chevy.I complained to the dealership and Chevy and never heard a word from either one.I had been a loyal GM buyer until then.It is there loss.How many other people have been wronged by Chevy and bought Fords for this reason.

  • Report this Comment On February 17, 2014, at 2:26 PM, texas2888 wrote:

    Four things here that will keep me from ever buying ANYTHING GM:

    #1 Active Fuel Management debacle

    #2 $40k + for a Chevy truck? I don't think so

    #3 Ugly

    #4 Bailout

    I've had Chevys, Fords and Toyotas (never owned a Dodge truck; probably won't). The Toyota BY FAR was/is the best truck I've owned. NEVER a single issue like with the other brands. The Tundra 5.7L is not the most economical engine but it blew away the Ford and Chevy in HP and MPG surprisingly. The dog slow Ford 4.6L was getting 13 MPG and 230 HP while the Toyota 5.7L was getting 16 MPG and 381 HP. The Ford's transmissions were terrible. Always with the torque shutter! The Chevy...just a myriad of things: steering column replaced three times, brakes, paint chipping off, cheap interior, door handles and locks malfunctioning, engine light constantly on, etc.

    I always prided myself in "Buying American", but I can't do that anymore. That being said, the Tundra IS the most American built truck these days. Chevy is the least (only 40% parts are American). The Tundra is also always at the top of the reliability list in the full size truck market. I've made the switch and I don't see myself ever going back.

  • Report this Comment On February 17, 2014, at 2:37 PM, proudamerican13 wrote:

    It is UGLY, UGLY, UGLY., It is a Chevy what can you expected failure. Square cheap UGLY.

  • Report this Comment On February 17, 2014, at 3:30 PM, NoVaEarly wrote:

    JFelano, get your facts straight instead of perpetuating ignorance. GM accepted billions in help and the stock the govt got in exchange was bought back for less than the govt paid for it and original GM shareholders were screwed completely. Taxpayers recouped $39 billion of the $50.1 billion given to GM meaning GM paid back $78 for every $100 borrowed. Ford paid back ALL of the principal borrowed plus $577 million in interest meaning Ford paid back $110 for every $100 borrowed. Those are very different circumstances. Also, having billions in debt and making billions in profit is how global companies function. That doesn’t mean Ford is in a bad financial situation. Am I broke because I make $100K a year but owe Wells Fargo $400K for the mortgage on a house worth $600K. Of course not.

  • Report this Comment On February 17, 2014, at 4:29 PM, afdkiller wrote:

    Had a buyer on my 2011 Lariat was going to use my GM credits and buy the "new" Silverado. Looked for a couple of days, can say without a doubt that is the worst looking truck I have ever seen. Lucky for me my buyer backed out.

  • Report this Comment On February 17, 2014, at 9:16 PM, RickJWagner wrote:

    If you think the numbers look bad now, give it a year or so.

    GM has started marketing 'left'. Which is a terrible mistake, because truck buyers tend to be red-state, 'right' side political folks. Make sense?

    The lefties spend money, too. But not on pickup trucks. And the cars they buy are not often domestic. (Prius, anyone?)

    To each their own. But if you want to sell trucks, don't spit in the eye of the farmer/rancher/construction worker.

  • Report this Comment On May 27, 2014, at 8:13 PM, GMbot wrote:

    North American truck of the year? How did Dodge beat GM's new truck with the title of Motor trend truck of the year? Which one carries more prestige? imported from a assembly plant in Mexico Which was built with tax payer dollars and lost jobs. Bottom line GM saved 1000 dollars a truck. Am I happy there sales have tanked yea I want the tax dollars back! GM. Bust up this waste of tax dollars. I think Ford has the best sales model and GM the worst.Ford's new 2015 is coming and that should scare GM! They will have lots of 2014's to sell in 2015 so If you want one wait the great deals are coming for this ugly thing that only a homer GM fan could like :)

  • Report this Comment On December 16, 2014, at 10:11 PM, bilzy2020 wrote:

    I Know style and the Chev is amazing. Detractors here ,have wet dreams about miss Piggy. Ram design appeals to mouth breathers and the unintelligent. Ford is ford...nothing special.

       Bot a 2014 LTZ Z-71 with the 6.2. Ram guys are so upset when I kill them quietly and in style

  • Report this Comment On April 21, 2015, at 3:53 PM, mgavett wrote:

    Why would you buy the new Silverado when GM won't stand behind the the mess of previous garbage they built. Our 2008 Silverado 2500HD 4x4 LTZ Crewcab has 54k. It's on 3rd set of transmission lines (guaranteed to fail in cold climates), lower radiator hose $500+ (ha), all door moldings falling off due to tape failure (no fasteners), chrome bumper end caps peeled in fog light openings because they are all plastic, interior plastic rattles drive you crazy. A 2" stack of repairs in excess of 50+ during warranty and GM knows of plenty more including software bugs documented by local dealer service manager yet GM engineering said not to attempt fixing - it's supposed to work like that - NOT!

    These are just a few of the issue and our response is we will NEVER buy another GM product and suggest you do the same. GM needs to own up to the problems and create real products not land fill material. Yes GM Fails and the new 2014-15 Silverado is a remake of the crap we own already and GM won't fix. Stop buying this junk.

Add your comment.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2840516, ~/Articles/ArticleHandler.aspx, 9/2/2015 10:40:33 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

John Rosevear

John Rosevear is the Fool's Senior Auto Specialist. John has been writing about the auto business and investing for over 20 years, and for The Motley Fool since 2007.

Today's Market

updated 1 hour ago Sponsored by:
DOW 16,351.38 293.03 1.82%
S&P 500 1,948.86 35.01 1.83%
NASD 4,749.98 113.87 2.46%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

9/2/2015 4:00 PM
F $13.87 Up +0.15 +1.09%
Ford CAPS Rating: ****
GM $29.21 Up +0.57 +1.99%
General Motors CAPS Rating: ***