If you read the May/June issue of Truck Trend, you saw the story we did on base-model work trucks. Doing the research for this story, we discovered that the least expensive truck sold in the United States is the Toyota Tacoma, which starts at $15,915 including destination. The least expensive full-size? The Chevrolet Silverado (and GMC Sierra), at $20,350.
There are two points here that bother me. First, why are compact trucks only $5000 less than full-sizes? There should be a much greater price difference, especially considering the significantly higher towing and payload capacities you get with a full-size, plus the larger cabin (even in a regular cab), larger wheels and tires, and better standard equipment. And when you add options to a compact pickup, that price difference gets much smaller--and there seem to be more discounts and rebates on full-size trucks, especially right now. While you can get V-8 power in a compact truck, you can actually get a V-8 in a full-size for less money. (We don't mean to pick on GM, but the least expensive V-8 Colorado you can get is $25,080; the least expensive V-8 Silverado is $22,130--and $22,730 with the same 5.3-liter as in the Colorado.) This price structure seems flawed to me and is a big reason why compact trucks haven't sold all that well for a long time.
Second, consider how little has been done to upgrade this truck category. When was the last time anyone did a major redesign? The Colorado/Canyon was new for 2004, and aside from some engine upgrades, hasn't seen much change. The Toyota Tacoma was new for the 2005 model year. The Frontier switched to the downsized Titan platform for 2005. Then there's the Ranger. Has it really changed all that much since the new body style was introduced for 1993? Besides, it still uses some of the same components as it did in 1983. The Dakota was updated in 2007 and the Colorado-based Hummer H3T was new for 2009, so those are the exceptions. But in all of these cases, there is no news on the horizon, and no major updates coming in the foreseeable future.
Dakota and H3T aside, even the newbie Frontier's tooling and R&D costs must have been covered by now, so the actual cost of building each individual pickup has to be minimal for every automaker across the board. Why, then are they still this expensive? If as a manufacturer you know you're going to keep putting out what is basically the same vehicle, why not lower the price? It worked for Henry Ford and the Model T--and Ford didn't lose money on that car.
Here's my idea: Why not make $10,000 the base price for a compact truck? At that price, which I realize is more than $5000 less than the least expensive pickup on the market, I would think the trucks would still be profitable. If $10,000 wouldn't bring a profit, the MSRP could be higher, but $10,000 is a nice, round number.And, to put it in overly simple terms, selling something at a lower-than-projected profit would be more lucrative than not selling something.
At $10,000, a compact pickup would be hard for most people to resist. Those who decided they couldn't afford any pickup truck would suddenly be a potential buyer again, and people who wrote off the idea of getting a compact instead of a similarly priced full-size would certainly reconsider getting something small. Think about it: You could get a bare-bones Hyundai Accent ($10,665) or Nissan Versa ($10,685)--or you could buy a Ranger. Or a Tacoma. Or a Colorado. A vehicle you could use for work, that gets good fuel economy, fits in your garage, and wouldn't cost much to register or to insure.
I'm not saying they should only cut the price of the base-model truck. My idea is that the price of every compact truck's trim level should be cut by the same amount. Let's say every small pickup's price was cut $5000. If a topline Frontier's MSRP is about $28,000, it would become $23,000. This would also address my earlier complaint--using the previous Colorado V-8/Silverado V-8 example, the Colorado would become about $20,000 and would cost less than the Silverado V-8.
It would help the autoworkers, too. Deeply discounted compact trucks would increase sales for every automaker that builds trucks, and once they burned through the days supply (a measurement of vehicle inventory), there would potentially be a need to increase production at several plants around the country. That could create jobs, or at least keep people employed. If the truck builders were uncomfortable with the idea of making this a permanent price change, they wouldn't have to--they could call it a recession special and end it whenever they want. If there's a concern about swapping a used car for a new one without money changing hands, they could always set restrictions on that, too.
If the truck makers do this now, they would be better prepared for whatever new competition comes their way, whether it's from Mahindra or some other company. And being prepared for what's coming might help our favorite truck builders stick around for a while.