This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

GM Timing Is Exquisite as Silverado Rolls Out Amid Truck Boom

DETROIT ( TheStreet) -- Are we about to enter Silverado Summer?

GM (GM - Get Report) is promising a massive new advertising campaign for its new truck, with the ad rollout coming Thursday, July 4. "It's going to be hard to miss the new Silverado as time rolls on," said Kurt McNeil, GM vice president for U.S. sales operation, on a GM sales call Tuesday.

The Silverado rollout could be GM's best move since it emerged from bankruptcy four years ago on July 10, 2009. U.S. truck buyers are acquisitive and getting more so. In June, GM pickup truck sales rose 29%, Ford (F - Get Report) F-150 sales rose 24% and Chrysler Ram sales rose 23%. Also, Toyota (TM - Get Report) pickup truck sales rose 16%.

"The Silverado is really going to solidify the GM turnaround," said analyst Jessica Caldwell. "GM is still kind of looking for a defining moment because a lot of people are thinking that Ford has come further. So the timing is fortuitous. From a profitability standpoint, the Silverado is very big for GM."

Caldwell identified three similar moments in the post-recession emergence of the U.S. auto industry, all occurring in 2010, as the economy was just starting a slow recovery that continues to this day.

That year, Chevrolet launched the Cruze, which showed that U.S. manufacturers were capable of making small cars in a U.S. plant and could perhaps be more than pickup truck companies that also build cars. Ford launched a new global Fiesta, which showed that "Ford was going to make cars too and would have a U.S. identity beyond the F-150," Caldwell said.

Chrysler, meanwhile, rolled out a new Jeep Grand Cherokee, its first major launch after being taken over by Fiat. At the time, "Chrysler was really struggling," Caldwell said. "This gave them some momentum." When Grand Cherokee sales jumped to 10,915 units in September 2010 from 6,396 in August 2010, it began to become clear that Jeep was going to lead the Chrysler revival.

Early Tuesday, GM said it will roll out its new Silverado ad campaign in Texas, where one of every six U.S. pickup trucks is sold. Pulling out the stops, GM commissioned a song called "Strong" by authentic country singer Will Hoge, best known for "Even If It Breaks Your Heart."

It is safe to say that Chevrolet's message will recall the "Heartbeat of America" maker of the "Baseball, Hot Dogs, Apple Pie and Chevrolet" brand. The campaign will roll out nationally during Major League Baseball All-Star festivities in mid-July, according to the Detroit Free Press .

About 5,000 new Silverados arrived at dealerships in June. They sat for an average of just 10 days. Don Johnson, Chevrolet vice president of sales and service, said the brief stay is not atypical or unexpected "when you launch a new one," adding: "You have a lot of customers waiting for this great new truck."

The Silverado rollout will hit a few bumps. A minor one is that GM still has a 70-day supply of 2013 Silverados in its inventory. They have to be sold too. Johnson said incentives will help Chevrolet to move them out. "There are two distinct buyers out there when you do a changeover," he said. "The old model will certainly appeal to some."

More importantly, F-150 has dominated the pickup truck sector for three decades and the 2013 Ram introduced in 2012 was the auto writers' pick as 2013 Truck of the Year at the Detroit Auto Show. "The competition is tough," Caldwell said. "People tend to stay loyal to their truck brand and Silverado is the No. 2 vehicle, which always has an uphill battle."

Still, does anyone doubt that the competition to be the 2014 Truck of the Year is now closed?

-- Written by Ted Reed in Charlotte, N.C.

>To contact the writer of this article, click here: Ted Reed

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
F $13.56 0.00%
GM $31.80 0.00%
TM $101.70 0.00%
AAPL $93.74 0.00%
FB $117.58 0.00%


Chart of I:DJI
DOW 17,773.64 -57.12 -0.32%
S&P 500 2,065.30 -10.51 -0.51%
NASDAQ 4,775.3580 -29.9330 -0.62%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs