General Motors Corp.'s 2007 GMC Yukon full-size SUV bows today at the California Auto Show, and the timing couldn't be worse.
It may not matter that the new Yukon, by all accounts, is superior to the current model. U.S. consumers are turning away from big SUVs at an alarming rate in response to high gas prices.
The shift in consumer preferences presents a huge marketing challenge for GM, which is counting on the Yukon and its stablemates to help spark a turnaround when they hit showrooms early next year.
The Yukon and Chevrolet Tahoe will be the first large SUVs to average 20 miles per gallon, GM says. And the automaker needs to convince customers that its big SUVs are not the gas-guzzling dinosaurs of the past, said Daniel Gorrell, vice president of Strategic Vision, a Tustin, Calif.-based auto consulting firm.
"What they've got to do is talk about fuel efficiency," Gorrell said.
It won't be an easy sell. GM's 50 percent drop in SUV sales in September left Wall Street analysts skeptical that demand will improve any time soon,
Merrill Lynch's John Casesa called the sales nosedive a "bad omen for the upcoming launch" of GM's new SUVs, while Standard & Poor's Corp. put GM and Ford Motor Co. on credit watch, citing concern about the companies' reliance on SUV sales.
In another sign of the pressure Detroit automakers face in selling large SUVs during a challenging time, GM, Ford and DaimlerChrysler AG's Chrysler Group on Tuesday rolled out new discounts for 2006 SUVs, ranging from $2,000 to $5,000 in cash rebates.
You mean they should have been diversifying their product range like Toyota has been?
It may not matter that the new Yukon, by all accounts, is superior to the current model. U.S. consumers are turning away from big SUVs at an alarming rate in response to high gas prices.
The shift in consumer preferences presents a huge marketing challenge for GM, which is counting on the Yukon and its stablemates to help spark a turnaround when they hit showrooms early next year.
The Yukon and Chevrolet Tahoe will be the first large SUVs to average 20 miles per gallon, GM says. And the automaker needs to convince customers that its big SUVs are not the gas-guzzling dinosaurs of the past, said Daniel Gorrell, vice president of Strategic Vision, a Tustin, Calif.-based auto consulting firm.
"What they've got to do is talk about fuel efficiency," Gorrell said.
It won't be an easy sell. GM's 50 percent drop in SUV sales in September left Wall Street analysts skeptical that demand will improve any time soon,
Merrill Lynch's John Casesa called the sales nosedive a "bad omen for the upcoming launch" of GM's new SUVs, while Standard & Poor's Corp. put GM and Ford Motor Co. on credit watch, citing concern about the companies' reliance on SUV sales.
In another sign of the pressure Detroit automakers face in selling large SUVs during a challenging time, GM, Ford and DaimlerChrysler AG's Chrysler Group on Tuesday rolled out new discounts for 2006 SUVs, ranging from $2,000 to $5,000 in cash rebates.
You mean they should have been diversifying their product range like Toyota has been?
