2024 Toyota Tacoma Trailhunter
Toyota
DETROIT — Size matters. Just ask America’s largest automakers.
Ford, General Motors and Toyota are amongst those increasingly seeking to capitalize on the growing midsize pickup truck segment: vehicles sufficiently big to command high price tags but sufficiently small to guard profit margins.
The small pickups have evolved from entry-level work trucks into pricey, capable and highly profitable models that may cost greater than $60,000 — in step with luxury vehicles from BMW, Cadillac and others.
“It’s just not geared toward people on a budget, because I believe that is what the segment was for a very long time,” said Jessica Caldwell, executive director of insights at auto research firm Edmunds. “The trucks are getting nicer with more amenities, more features and more emphasis on design.”
Midsize pickup trucks are following the lead of their larger, full-size counterparts comparable to the Ford F-150, Chevrolet Silverado and Toyota Tundra. They’ve turn out to be more capable, larger and pricier, with an influx of recent luxury and off-road variants, and special features.
Sales of midsize vehicles have topped 600,000 vehicles since 2019, as consumer interest has moved away from traditional sedans to utility vehicles comparable to crossovers, SUVs and, in fact, pickup trucks.
Over the past decade, traditional midsize pickup truck sales have greater than doubled to represent 4.4% of U.S. vehicle sales last 12 months — up from a minuscule 1.6% in 2013, and the best level since 2005, in accordance with Edmunds.
S&P Global Mobility expects sales of midsize pickups to proceed to grow in the approaching years but top out as a percentage of U.S. market share at 4.6% in 2026.
The common price paid for one in every of the vehicles is likewise rising: Through the past decade, the typical price increased 53% from about $28,100 to greater than $42,000, Edmunds reports. That price growth is 3 percentage points stronger than the general industry.
Competition increasing
The midsize pickup segment has grown from three vehicles in production a decade ago to now seven gas-powered pickups from the likes of Chevrolet, Ford, GMC, Honda, Jeep, Nissan and Toyota. Half the brands have announced redesigned vehicles this 12 months, which is predicted to spice up interest and competition within the segment.
2023 GMC Canyon AT4X Edition 1
GM
“It’s really hotter than it’s ever been when it comes to midsize truck,” Patrick Finnegan, senior manager of GMC trucks and full-size SUVs, told CNBC. “There’s loads more effort, energy and enthusiasm [and] momentum constructing on this segment than we have ever seen.”
While the Detroit automakers dominate large pickup truck sales, Toyota Motor is the clear leader in midsize pickup truck sales with its Tacoma.
Toyota has commanded a roughly 40% share of the American midsize pickup truck segment since 2019, when Ford and Jeep reentered the market, Edmunds reports. That is down from a greater than 60% market share a decade ago — despite Tacoma sales that surged roughly 150% since then — as rival automakers have released recent trucks.
It is a position Toyota has no plans of relinquishing: “[Tacoma] is the No. 1 selling vehicle within the segment … our intention is for that to stay,” said Joseph Moses, Toyota North America general manager of trucks and SUVs.
Trailing Toyota is GM. Edmunds reports the Detroit automaker’s share of the U.S. midsize pickup segment last 12 months was about 19%, followed by Stellantis‘ Jeep Gladiator at 12.8% and the Nissan Frontier at 12.5%. Ford’s Ranger was at 9.4%, down from roughly 15% market share the previous 12 months.
“I do not see any reason or way Toyota’s dominance on this segment doesn’t hold,” said Stephanie Brinley, principal automotive analyst at S&P Global. “It has gone down since 2017 … but they’re still well over 200,000 units [annually]. Nobody else is even close.”
Various strategies
Automakers’ sales volumes speak to their diverging strategies within the midsize pickup truck segment.
Toyota promotes what it calls “a Tacoma for everybody,” offering several variations of its standard model, including a two-door version of the Tacoma, two different bed lengths, and a recent high-end, off-road “Trailhunter” model. It is also offering the Tacoma with a manual transmission — a rarity in today’s automotive industry.
Meanwhile, its competitors have limited the variety of cab and pickup box configurations they provide, shifting to exclusively four-door midsize pickups with one bed option to scale back complexity.
Much of the midsize optionality tends to be a profit play. Ford CEO Jim Farley last month told investors that special variants — comparable to a recent performance Raptor model in Ford’s Ranger lineup — share roughly 80% of their parts with regular models but have 30% higher contribution margins.
The Raptor will start at $56,960. That is nearly $23,000 greater than the entry-level Ranger model.
2024 Ford Ranger Raptor
Ford
“The Raptor’s going to be at the highest end of our Ranger offering,” said Gretchen Sauer, Ford’s marketing manager of the pickup. “It is going to extend up our overall transaction price for Ranger.”
GM counts Chevrolet as its mainstream brand for the midsize pickup segment, while GMC specializes on higher-end models.
GMC’s Finnegan said the brand expects to extend recent customers with its redesigned Canyon. Much of that draw is predicted on the high end of the market with GMC’s off-road AT4 and AT4X models, which might top each top $60,000.
“It is a priority for us when it comes to stepping into that segment and growing our share,” Finnegan said. “I believe it’s probably protected to say that with all the brand new entries within the segment, we predict that the segment will grow.”