Quote:
Originally Posted by motorhead
You said it right there. Times are very different then the days of high profit Truck and Suv sales steering a car maker. I was merely speaking from first hand experience that I saw when my buddy lost his dealership when gas prices went nuts. He told me it was do to the fact that Truck and Suv sales dropped deeply and he had to many that he had to sell at a loss. I know all about the glory days of high profit from SUV and Truck sales ,but like I said those days are gone.
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How can you argue that trucks bankrupted GM when GM makes money on them? True, GM as a whole started losing money because they were no longer selling enough trucks to make up for what they lost on the cars. But that still means that they were losing the money on the car side of the business, not the truck side, so ultimately, the bankruptcy was the result of a poor car business, not poor truck sales. What GM needs to do is not to stop selling large numbers of trucks (again, they make money there, so they'd be smart to sell as many as possible) but to find a way to make the cars profitable too.
I think it was the same issue with the dealership that went under. That was because the owner was a bad business man, not because of gas prices. If the dealer was losing money because he had more inventory than demand, that's his fault for over ordering. Gas prices rose, and the bottom of the SUV market dropped out gradually over a period of years...more than enough time for dealers to adjust their inventories and ordering to suit demand. All the dealerships in my area did just fine with $4+ gas. People couldn't rush to those dealerships fast enough to trade in those SUVs (for next to nothing) to pay a premium for hot selling cars and crossovers.