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Can these vehicles save the Big Three?

Trying to shake a long slump, U.S. automakers show t hat they, too, can make smart, fuel-efficient cars.

By TOM ZUCCO
Published November 2, 2006

ADVERTISEMENT [Times photos: Joseph Garnett Jr.] New cars like the 2007 Saturn Sky are on display at the auto show at the Tampa Convention Center. Ray McCulley polishes a Mercury Mariner before the show opens today. SUV sales have receded in recent years. Crossover vehicles such as the Dodge Nitro are gaining in popularity as their space and design mimic that of larger sport utility vehicles but their fuel-efficiency doesn’t.

TAMPA - If America's Big Three automakers are going to stem the flow of red ink and regain their place firmly atop the auto industry, the healing must begin at places like this.

For the next three days, more than 400 cars, trucks, minivans and sport utility vehicles will be on display at the Tampa Bay International Auto Show at the Tampa Convention Center.

But to varying degrees, alongside the 2007 Toyotas, Nissans and Hondas, the future of the American auto industry is also on display.

And the future is small.

Analysts say U.S. retail sales are down 3.5 percent for the year, and they blame higher gas prices, a decline in the housing market and a slowdown in the economy.

But U.S. automakers are also responsible, given the relatively healthy numbers posted by Toyota and other foreign competitors.

While GM maintains its lead as the world's largest automaker, Toyota this summer muscled into second place, ahead of Ford and DaimlerChrysler. As of October, Ford had regained the second spot.

But news of record losses, plant closings and corporate shakeups have dominated the headlines lately as the Big Three scramble to catch up to America's changing tastes.

Which brings us back to the auto show.

"People aren't as brand-loyal as they used to be and need to experience our products before they make an assumption," DaimlerChrysler spokesman A.J. Perez said Thursday as a newly redesigned Sebring sedan was being driven into position on the convention center floor. "We are very dedicated to car shows."

Ford, GM and Chrysler have for nearly 20 years banked on the solid sales of their small truck lines - the F-Series, Silverado and Dodge Ram, respectively. All three brands remain the leading sellers for each company.

But as gas prices climbed and needs changed, the focus began to shift to small cars. Analysts expect automakers to sell about 2.5-million small cars this year, or about 15 percent of the total car market, a 2 percentage point gain from 2004.

On the opposite side, sales of SUVs, which accounted for about 18 percent of total sales in 2003, are expected to peak at about 14 percent this year.

Another striking trend is smaller SUVs, the so-called crossover vehicles. Sales of crossovers made up about 3 percent of the market in 2000; they are expected to hit close to 13 percent this year.

That's why the stars of the Tampa Bay show, American automakers say, are not just the pickups, concept cars and glitzy sport cars.

This year, small is big. Smaller sedans and smaller SUVs. Price is still a key factor, but if the miles-per-gallon number on the sticker reads 30 or higher, so much the better.

GM, which has weathered the storm better than its two American counterparts, now has nearly 20 models that get at least 30 mpg.

Besides a refreshed Silverado, GM is offering a new Saturn Outlook midsize SUV and hybrid versions of it's View SUV and Aura sedan.

"We have our own turnaround plan," said GM spokesman Alejandro Vitale. "There's definitely a sense of urgency to make 2007 a great year.

"The key to the success is quality, fuel economy and reliability."

It's also timing. It typically takes at least three years to get a new model from the drawing board to the showroom, so anticipating the needs of buyers is crucial.

Another issue is money. While a full-size SUV earns a profit, before expenses, of about $9,000, subcompacts earn about $400.

Ford has jumped into the fray with its Edge, a crossover SUV that is built on the same platform as the midsize Fusion sedan.

Like GM and Chrysler, Ford had relied on its pickups to carry the company. Last year, the company sold close to 920,000 units, again making the F-Series the bestselling truck in the United States.

"But we are starting to come back into the car market," Ford spokesman Alvaro Cabal said. "Trends are changing, and the biggest trend is the SUV people going more into crossovers because they don't need that big space.

"Our new full sized SUVs, the Expedition and Navigator, are selling really good. But they won't be a volume market. They're a niche market."

Again, the high price of gas figures prominently. "We don't expect it to stay low forever," Cabal said. "Gas at close to $3 a gallon will be a reality."

What hurt Ford the most, analysts say, was poor planning and a heavy reliance on its truck. But while Ford desperately wants to hang on to its F-Series lead, the company knows it has to recapture the smaller brands to remain competitive.

"There is no longer one vehicle that will carry the business for the auto industry," Cabal said.

"The market is getting more fragmented, and we are listening to the customers. The next two years are critical for Ford." he said.

"I wouldn't say the corner has been turned, but we are seeing the results of our work."

If You Go

Tampa Bay International Auto Show

Where: Tampa Convention Center, 333 S Franklin St., Tampa

Hours: noon - 10 p.m. today and Friday;10 a.m. - 10 p.m. Saturday; 10 a.m. - 6 p.m. Sunday

Admission: $8 for adults; $4 for active/retired military, adults age 62 and older, students and children age 7-12; free for children 6 and younger

For information: (813) 276-6907

[Last modified November 2, 2006, 11:05:25]