The global semiconductor shortage has weighed on auto production this year, constraining U.S. sales despite strong demand. However, while the shortage is widespread, it hasn’t hit all automakers equally.
That led to some big changes in the usually pecking order within the auto industry last quarter. Toyota Motor (NYSE:TM) became the top-selling automaker in the U.S. for the first time ever, edging out General Motors (NYSE:GM). Yet GM scored its own success, making huge market share gains in the full-size truck market at Ford Motor‘s (NYSE:F) expense.
Toyota takes the crown
Last quarter, Toyota sold 688,813 vehicles in the United States. That was just enough to slide ahead of GM, which reported 688,236 domestic deliveries in the second quarter.
Toyota’s second-quarter U.S. deliveries jumped 73% from just 398,029 a year ago, when the COVID-19 pandemic crushed sales. More impressively, Toyota also beat its Q2 2019 U.S. sales volume of 608,392 units by 13%. Clearly, Toyota has done a better job of managing semiconductor supply constraints than its rivals, allowing it to make big market share gains.
As usual, Toyota got the bulk of its U.S. sales from five models: Camry, Corolla, Highlander, RAV4, and Tacoma. Together, they have accounted for 74% of Toyota brand sales and 65% of the company’s total U.S. sales (including the Lexus brand) year to date. Unsurprisingly, the Highlander and RAV4 crossovers and the Tacoma midsize truck drove the bulk of Toyota’s growth compared to 2019.
GM prioritizes trucks
General Motors’ 688,236 domestic deliveries last quarter represented a 62% year-over-year increase but an 8% decline from the second quarter of 2019. The mass-market Chevrolet brand accounted for more than 100% of the sales reduction relative to Q2 2019. Buick sales actually jumped 19% from two years ago, enabling the brand to record its best quarterly sales in over 15 years.
GM prioritized the use of its limited semiconductor inventories to maximize production of its high-margin full-size pickups. It slashed production of Chevy sedans: Combined sales of the Sonic, Malibu, Cruze, and Impala models plunged from 63,700 in Q2 2021 to fewer than 6,000 last quarter. (GM has discontinued the latter two.) The auto giant also reduced output of a few other models that tend to generate lower margins, especially the Chevy Equinox compact crossover.
Meanwhile, GM delivered 164,731 Chevy Silverado full-size pickups: up 16% from the second quarter of 2019. That was just enough to beat Stellantis‘ Ram pickup, which sold 164,232 units in the U.S. last quarter. (That was up from 117,448 units a year earlier but still fell 8% short of Ram’s Q2 2019 domestic sales.)
By contrast, the global semiconductor shortage has hit Ford especially hard. As a result, the Blue Oval delivered just 158,235 F-Series trucks last quarter, compared to 233,787 in the second quarter of 2019. This dropped F-Series all the way to third place from its usual spot as the best-selling truck in the U.S.
Of course, the Chevy Silverado isn’t GM’s only full-size truck. The General also builds the GMC Sierra, which is an even pricier, more lucrative truck model. GMC Sierra sales totaled 75,495 units last quarter: up 40% year over year and up 33% from Q2 2019. That brought GM’s total U.S. full-size truck deliveries to 240,226 units last quarter, beating each of its top two competitors by around 50%. This strength in the truck market will enable GM to post another huge profit for the second quarter.
Despite its strong U.S. sales last quarter, Toyota could struggle to maintain its market share over the next few years due to its relatively limited portfolio of crossovers, SUVs, and trucks. If demand continues to tilt toward larger vehicles, it will benefit GM, Ford, and Stellantis.
Conversely, Ford may have the biggest market share opportunity over the next few years despite its current weakness. The recent arrival of its Bronco, Bronco Sport, and Mustang Mach-E models has broadened its portfolio of crossovers and SUVs. Importantly, these vehicles will appeal to customers who might not have considered any of Ford’s other models.
Finally, GM is eager to build on its recent momentum in the truck market. The automaker will boost its full-size truck production capacity later this year by adding a fourth assembly plant. With supply constraints currently weighing on truck sales, this extra capacity should enable General Motors to capitalize on pent-up demand over the next couple of years, driving its earnings to new heights.
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