General Motors (NYSE:GM) made waves when it showed off its upcoming 2015 Chevrolet Colorado pickup last month. The Colorado is a midsize pickup, once a popular product segment -- but now, a category with relatively modest sales.
The Colorado is expected to compete well with the current segment leader, Toyota's (NYSE:TM) Tacoma -- but even the Tacoma's sales are relatively modest. That's why Ford (NYSE:F) and Chrysler both discontinued their midsize pickups in recent years. But now Chrysler says that it has what midsize pickup buyers really want: A full-sized pickup with great fuel economy -- thanks to a diesel engine.
But are they right? In this video, Fool contributor John Rosevear takes a look at the upcoming pickup from Chrysler -- and offers his take on whether it can really compete with the Tacoma and Colorado.
An abbreviated transcript of the video:
Hey Fools, it's John Rosevear. So General Motors showed off its 2015 Chevy Colorado pickup at the Los Angeles Auto Show a couple of weeks ago, and it continues to cause a lot of head-scratching among auto analysts. The Colorado is a mid-sized pickup, and that's a market segment that has really shrunk in the last several years. Toyota's Tacoma sells about 10, 12,000 a month or a bit more, Nissan's (NASDAQOTH:NSANY) Frontier sells about half that. Honda's (NYSE:HMC) Ridgeline is kind of part of this market, and kind of its own thing. But that's the whole segment right now, the segment that the Colorado is walking into. It should do quite well for GM, though it might take some sales from GM's full-sized pickups, it'll probably take some from Toyota and Nissan as well, and maybe also get some buyers who have been buying SUVs but really could use a pickup. Ford of course no longer competes in this market. It still sells the Ranger overseas, in fact that version of the Ranger was all new in 2011, it was designed by Ford's Australian division, but it's not sold here and Ford hasn't given any hints that it will be sold here. And Chrysler used to sell the Dodge Dakota midsize pickup but discontinued the last version of that back in 2011. But Chrysler thinks it can compete for that same group of buyers with a new diesel version of its full-sized Ram pickup. Reid Bigland, who is the chief of Chrysler's Ram truck brand, told Autoblog that the Ram 1500 EcoDiesel, a new model that is due out next spring, could appeal to the same buyers looking at trucks like the Colorado and the Tacoma. He thinks that the key is fuel economy, and he notes that the new EcoDiesel Ram is expected to get 20 miles per gallon in the city and 27 on the highway, compared to the regular V6 Ram, which only gets 16 city and 23 highway. GM hasn't released fuel economy figures for the Colorado, but the Tacoma gets 21 city and 25 highway, so the Ram EcoDiesel is pretty competitive. So Bigland thinks that the draw of midsize pickups for a lot of buyers is that they get better fuel economy than the full-sized trucks. But I wonder if he's right. I think there's a group of pickup buyers who like the smaller size because it's easier to park and live with a truck that's more car-sized rather than a big Ram or Silverado or F-150. Do you think Chrysler's on to something, or do you think size matters when it comes to pickups? Leave a comment and let me know. Thanks for watching, and Fool on.
Fool contributor John Rosevear owns shares of Ford and General Motors. You can connect with him on Twitter at @jrosevear. The Motley Fool recommends Ford and General Motors. The Motley Fool owns shares of Ford. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.