GM Says the New Silverado Is Doing Better Than You Think

Sales of the 2014 Chevy Silverado were down again in February. Photo credit: General Motors Co.

At first glance, it was a rough month for General Motors (NYSE: GM  ) and its all-new pickup trucks. 

GM's U.S. sales were down 1% last month, as harsh winter weather in many parts of the country kept buyers away from car dealers. That's not so bad: Rivals Ford  (NYSE: F  ) and Toyota  (NYSE: TM  ) posted bigger declines.

But here's the rough part: Sales of Chevy pickups were down 12%. The 2014 Chevy Silverado, an all-new model introduced last year, has been praised by critics -- but both Ford and Chrysler saw pickup sales rise in February. That's leading some analysts to whisper that GM's new pickups are failures.

But are they? GM says the story isn't so bad, and they make a solid case. Meanwhile, some of GM's other recent models are actually doing quite well. In this short video, Fool contributor John Rosevear digs into the numbers -- and concludes that GM's new pickups, and GM as a whole, are doing better than you might think. 

A transcript of the video is below.

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John Rosevear: Hey, Fools, it's John Rosevear. Like most of the other big automakers, GM had a tough month for U.S. sales in February. GM said this past week that its U.S. sales were down 1% last month, as tough winter weather kept buyers away from dealers. That's actually a little better than most analysts expected. Both Ford and Toyota saw bigger sales drops last month.

GM said that its big ad blitz during the Winter Olympics helped push some sales, and that things picked up a bit as the weather in some parts of the country improved toward the end of the month. GM saw good sales of cars and crossovers, but once again, its new pickups had a tough time. Chevy Silverado sales were down 12%. That drop continues to raise questions about the success, or lack of success, of the all-new Silverado that was introduced last year.

But GM says that drop isn't the whole story. That number rolls together both Silverado 1500s as well as Chevy's heavy-duty pickups. The heavy-duties weren't all new last year, they'll be replaced later this year. GM says that if you look just at light-duty pickups and retail sales, its market share actually went up 2 percentage points in February. GM also says that its average transaction prices have been very strong, and that more than half of its light-duty pickups -- that's the Silverado 1500 along with the GMC Sierra 1500 -- more than half of those are "premium" models with higher profit margins.

GM did admit that its incentives rose a bit in February, but they said that's mostly because they're selling down the last of those old heavy-duty pickups as well as the last of the big SUVs, the Chevy Tahoe and Suburban and GMC Yukons are in the process of being replaced with the all-new models and dealers are selling off the last of the old ones.

So we continue to keep a sharp eye on GM's less-than-impressive-looking pickup sales, but it's important to note that GM is having some good success in other key parts of the market. Compact and midsize car sales were down at Ford, but not at Chevrolet. Sales of the Sonic and the Cruze and the Malibu were all up by double-digit percentages. At the higher end of the market, overall sales of the new Cadillac CTS were down a bit versus last year's sales of the old version, but GM said that retail sales were up 7%, and they estimate that its market share was up by 1.6 points, which is strong for Cadillac.

GM also said that commercial fleet sales were up for the fourth month in a row, and are up 8% year to date. Now, I know that some folks get worried about fleet sales, but commercial sales are the good ones. This is sales of things like big batches of trucks to contractors. This is good profitable business, business that Ford and GM compete hard for -- we're not talking about dumping cars on rental fleets here.

So, all in all, when you dig into the numbers, it was a decent month for GM in comparison to what some of its competitors put up, and I think the doom and gloom around GM's truck sales might be a bit premature. We'll see how things look once the weather improves, though. Thanks for watching, and Fool on.


Read/Post Comments (15) | Recommend This Article (1)

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 March 08, 2014, at 8:11 PM, Jason87467 wrote:

    Some of the media is always anxious to say negatives when it comes to GM. The Government Motors stigma is still hanging in there....so I'm not surprised.

  • Report this Comment On March 08, 2014, at 8:11 PM, Jason87467 wrote:

    Some of the media is always anxious to say negatives when it comes to GM. The Government Motors stigma is still hanging in there....so I'm not surprised.

  • Report this Comment On March 08, 2014, at 9:14 PM, nofooljon wrote:

    Most of GM's new products are outstanding including the new Silverado and Sierra trucks. The negative comments are misguided.

  • Report this Comment On March 08, 2014, at 10:40 PM, nickjhjr wrote:

    I think another reason Ford's #'s are what are is that is because of the 2014 F150 is in the last year until the body style change. Ford like all manufacturers has to over rebate to clear them out.Ford continued to lease the 2013 left overs to clear out the inventory. 2015 Silverado was rated North American truck of the year along with 2014 Cadillac Cts car of the year.GM has some great vehicles in the show rooms right now.

  • Report this Comment On March 09, 2014, at 12:20 AM, chronarch wrote:

    The lack of rear AC vents in the 2014 Silverado crew cab is a deal killer for many. GM really needs to add the rear AC back to the crew cabs or sales will keep going to Ford & Dodge in the summer months. GM does not understand that people ride in the rear seats of crew cabs. Rear AC is a must & GM does not offer it.

  • Report this Comment On March 09, 2014, at 1:11 AM, Pearl wrote:

    Is GM owned by China? where are Gm cars and Trucks maid?does any one know? I saw where the ceo of GM made an announcement that they teamed up with communist china. is this true?

  • Report this Comment On March 09, 2014, at 10:25 AM, bpainter wrote:

    Ford will make its first payment on 5.9 billion loan from Obama Administration this month also payment is on time.

  • Report this Comment On March 09, 2014, at 12:55 PM, Rotomoley wrote:

    It is a solid no nonsense work truck. And it drives like one too.

  • Report this Comment On March 09, 2014, at 12:59 PM, straightfax wrote:

    GM trucks are made in Ft. Wayne, IN; Flint, MI, Arlington, TX and Silao, Mexico. GM has not teamed up with Communist China, but we do sell a lot of cars and trucks there, just like all the other vehicle manufacturers like Ford, Chrysler, Toyota, Nissan, VW, etc.

  • Report this Comment On March 09, 2014, at 1:44 PM, cityperson wrote:

    So far I have only seen a few of the new Silverados here in San Diego, but allot of new Fords and Rams.

  • Report this Comment On March 09, 2014, at 3:02 PM, mrgreenjeans wrote:

    all these trucks in general are over priced GM, Ford, Ram this pricing is not sustainable for most people and when gas prices surge again to 4.00 there will be a mass exodus from this segment of the industry a truck priced 40 to 50 thousand dollars or more will sit on lots everywhere til the prices get slashed

  • Report this Comment On March 09, 2014, at 4:34 PM, speedntj wrote:

    UGLY UGLY UGLY. That's the problem with the new Silverado. They need to make round fender wells!

  • Report this Comment On March 10, 2014, at 6:42 AM, Rolland wrote:

    Yes just a total failure, put a for sale sign in the window. Go Chevy Go GM. If I had the money I would buy one or a Cadillac.

  • Report this Comment On March 10, 2014, at 9:49 AM, bullitt1 wrote:
  • Report this Comment On March 10, 2014, at 1:04 PM, texas2888 wrote:

    One comment: Active Fuel Management. As long as they attempt making that technology a part of their trucks, I'd never buy one. Google "Active Fuel Management" (ACM) and read the articles about the issues that comes along with engines that use it.

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