In recent years, American automakers have returned to classic-style muscle cars. These cars have been designed to look nostalgic and very similar to their counterparts from the early 1970s. Ford started this new trend with the new Mustang in 2005. With styling very reminiscent of the Mustang of the 60s, the car was a instant success. Ford had had the market cornered since GM discontinued the Camaro in 2002 and Chrysler also lacked a rear-wheel drive V8 muscle car. In the last year, this has changed with the introduction of the new Challenger and, recently, with the introduction of the new Camaro. Car enthusiasts are happy to see these cars make a comeback and the question is, how long will they last?
In the past three months, GM and Chrysler have sought bankruptcy protection to help reduce debt and allow them to continue making cars. GM has sold many of its brands, including Saturn, Hummer, and Saab. The federal government is now the main shareholder of both companies. The government plans to implement a new administration to change the line of cars that both companies are producing to focus on small cars and cars and trucks with smaller engines. It will be interesting to see how consumers react to this change.
The area where American automakers have been most successful in the past 20 years has been trucks, SUVs and coupes and sedans with larger engines. No muscle car enthusiast will want to replace their Mustang with a Honda Civic. Ford tried that in the late ’70s with the Mustang II and it was a disaster.
For me, the heart and soul of the American auto industry are high-performance cars and trucks. This is where American auto companies have been able to dominate the market. Honda, Nissan and Toyota have launched new full-size pickups in the past five years, and sales of these vehicles still pale in comparison to sales of the Silverado, Sierra, and F150s.
A year ago, with gasoline prices at their highest, industry analysts criticized American automakers for not having better small car deals to compete with Japanese and European automakers. I would have to agree with that sentiment. As much as gasoline prices have changed in the last six or seven years, it seems that American companies have tried to move away from small 4-cylinder cars and produce more V6 and V8-powered cars, which in hindsight was not the best. right decision. By doing this, they have allowed Toyota, Honda and others to gain more market share in a super competitive market. Both GM and Chrysler need to present stronger offerings in these markets.
However, since gas prices fell dramatically in late 2008, truck and SUV sales have risen substantially. Toyota, which had a very long wait to buy a Prius a year ago, can’t give away those cars even with big incentives today. The point is clear: Americans want their big-engine cars and trucks as long as gas is affordable. When gasoline increases, the market shifts to smaller, more fuel-efficient cars.
At this point, it doesn’t make sense for American automakers to make a dramatic shift from the cars and trucks that have kept them alive in recent years to small cars that no one has proven they can sell. We know they can sell high-performance cars and trucks. Try going to a local dealer today to buy a Challenger or Camaro. Most dealers don’t even have one, and if they do, they won’t be there for more than a day or two.
In light of everything that has happened in the auto industry in the last year, it will be interesting to see what the future holds for the muscle car. Are we repeating the 1970s, where high gas prices and emissions will help take down the muscle car again? Or are we seeing a muscle car revival that will survive in light of the current economic climate? Only time will tell.
