General Motors Makes The Most of Lower Volume Higher Margin Anomaly
As the US economy continues its robust recovery, few companies can revel in the change of circumstances more than General Motors. In 2017, topping US sales and being the world’s 4th largest automaker, the company posted 10.7% margins on a drop in volume of over 13%.
While GM attributes this “less is more” windfall to newly polished brand appeal, and vigilant cost-control, the alchemy is really in the mix of economy, consumer confidence, fuel cost and the continued expansion of demand for truck and SUVs of varying sizes.
Leading with pick-ups Chevrolet is pursuing an aggressive truck strategy, with an all new and widely acclaimed Chevrolet Silverado 1500 for 2019 in a variety of specialty and Heavy Duty models, and a newly sport tuned editions of the mid-size Colorado.
On the SUV side the already dominant full sized Chevrolet Tahoe gets the RST engine upgrade with the 420 horsepower 6.2 liter small block V8. The Chevrolet Equinox small SUV has not only surpassed the segment leading Ford Escape in sales but is already seeing an average sales price increase of 10 percent plus this year.