Muscle Cars Mount Comeback, Can Market Sustain Them?
Dodge’s new Challenger turned heads at the Chicago Auto Show, and a production version of the Chevrolet Camaro is just around the corner. Both will lock horns with the venerable Ford Mustang, the market’s sole muscle car for several years running. Doubts remain, however, as to whether high gas prices and a weakening economy can sustain three cars whose V-8 engines burn as much fuel as they do rubber.
Dodge parent Chrysler has high hopes for the rebirth of American muscle. At the Challenger’s introduction, Chrysler president Jim Press told reporters the rear-wheel-drive coupe represents “the DNA of the company.”
Press said muscle cars are “not a huge market … [but] in the long term these vehicles will continue because these are vehicles people love.”
Put another way, the cars have a decent chance of weathering an economic storm.
“What we see particularly with this performance segment is resilience to gas prices and recession,” marketing director Mike Accavitti said. “As gas prices go up, SRT sales don’t fall. … Enthusiasts drive this car every day. They put greater value on the driving experience.”
They’ll likely pay dearly for it. No mileage figures have been released yet for the 425-hp, 6.1-liter Challenger SRT8 shown at the auto show, but the Dodge Charger SRT8, which shares its drivetrain, gets just 13/18 mpg city/highway — and requires premium fuel. (The 500-hp Mustang Shelby GT500 isn’t much better: On premium fuel, it gets 14/20 mpg.)
Dodge will unveil a broader lineup of Challenger models at next month’s New York auto show, Accavitti said. Presumably that means smaller engines — likely including a 5.7-liter V-8 — with better mileage.
Even so, the Challenger will be a niche vehicle. Once production ramps up, Press expects annual sales to be somewhere between 20,000 and 30,000. That’s about the number of X3 SUVs BMW sells in a year — and it’s a flyspeck compared to the Mustang, which sold some 135,000 copies in 2007.
Dodge doesn’t expect its sales to come at the Mustang’s expense. Press characterized the Challenger as an emotional purchase that doesn’t necessarily supplant another car, and Accavitti said that for many, it’s likely to be the third or fourth vehicle in the driveway.
“There’s an existing pie right now that’s buying Mustangs,” Accavitti said. “What we see is our addition growing that pie.”
Ford welcomes the competition.
“If we’re sitting here next year, and we’re in the middle of the muscle-car war, I will be the happiest person on the Ford stand,” car marketing manager Robert Parker told us at the Chicago Auto Show. “As the three domestic manufacturers, this is very important to us — Challenger and Mustang and Camaro, competing head-to-head in the showroom, on the track, on the drag strip and in cities and towns across America.
“It’s uniquely Americana,” Parker said. “I’m glad they’re coming. It’s been a bit of an intra-squad scrimmage, and we’re looking forward to the regular season. And I think the segment is going to grow, and I think we’ll all get our fair share.”
J.D. Power and Associates analyst Tom Libby shares Ford’s optimism, though his is more qualified. He characterized the Mustang as the most “American” of the three cars — people buy it because it’s a Mustang, not necessarily because it’s a muscle car — but said it will lose a few buyers to its rivals.
“The advertising and promotional activity will increase awareness and interest in the entire segment,” Libby said, but added that “the move toward better fuel economy and lower emissions goes against the move toward performance, so I think the entire performance-oriented portion of the market will have less appeal and success in today’s marketplace than it would have 10 years ago.
“There is room for all three, but the [sales] volumes will not be that great,” he said. “The question is whether or not the launch of the Challenger and Camaro will expand the segment or just split the same group into three separate parts. I think there will be some of both.”
