The Detroit-based automaker not only expects the new 10th-generation vehicle -- available at Chevrolet dealerships nationwide -- to grow its own sales, but the entire, dwindling large sedan segment.Watch video
DETROIT- General Motors Co. has high hopes for the 2014 Chevrolet Impala.
The Detroit-based automaker not only expects the new 10th-generation vehicle -- available at Chevrolet dealerships -- to grow its own sales, but the entire, dwindling large sedan segment.
“We’ve seen it in the past, when you introduce such a great vehicle, that you can change the dynamics of the segment,” said Don Johnson, vice president of Chevrolet sales and service, during a media event Monday to launch production of the vehicle at the Detroit-Hamtramck Assembly plant.
A decade or so ago, many people wouldn’t have even batted an eye at that statement. Things were good. GM, like the Impala, appeared too big to fail. But nowadays, that is one lofty goal as large sedan sales have driven off a cliff, consumers are demanding more fuel-efficient vehicles and mid-size sedans are getting bigger.
In 2007, large sedan sales in the U.S. topped 1.1 million units and represented 7.1 percent of the more than 16 million vehicle market, according to Edmunds.com. In 2012, large sedan sales were around 560,000 units and represented only 4 percent of the 14.5 million vehicle market.
Through that time of large sedan sales being cut in half, the industry has evolved. GM particularly has changed its mindset and is arguably offering the best lineup of vehicles in the company’s history, and the Impala has continued to be the large sedan segment’s leader since 2004.
However, Impala’s dominance in the segment comes down to one thing: Fleet sales. Thanks heavily to rental, government and other business entities, the iconic vehicle has remained the number one seller in the large sedan segment for nearly a decade.
"The large car segment dumps a heavy proportion of their vehicles into fleet, and historically the Impala has sent massive quantities of vehicles into fleets; 71 percent & 77 percent in 2011 and 2012 respectively," said Edmunds.com analyst Jeremy Acevedo.
With the 2014 Impala, GM hopes to swap those rates. The new generation Impala features a more aggressive exterior design and overhauled interior with a host of Chevrolet-first safety and technology features, including Chevrolet's next-generation MyLink infotainment system.
The industry average over the last two years for fleet sales in the full-size segment is about 44 percent, according to Edmunds.com. GM hopes to not top 30 percent with its new Impala.
To meet the fleet demand, GM will offer a “Limited” model, which is essentially the last-generation Impala. Johnson said GM expects Impala sales to increase this year from 2012, as the Limited models continue to fill fleet demand and the new Impala attracts new buyers to Chevrolet dealerships.
“There’s still very good demand for an Impala like the Limited that is out there,” he said. “By having both vehicles, we’re going to maximize both our retail and our fleet opportunity.”
Since 2010, Impala sales have remained between about 169,000-172,000 units, including 169,351 last year. GM has built about 16 million Impalas since introducing the nameplate in 1958.
Jesse Toprak, TrueCar.com senior analyst, said GM’s ambitions to grow the segment, while admirable, just don’t seem realistic.
“It’s been one of the weakest segments in the entire industry,” he told MLive.com. “When you look at the prospects of potential growth in that segment, I don’t see any really because there’s so much competition from other segments.”
Toprak said it’s going to be an uphill battle for GM largely due to consumers wanting “a lot of car for their money,” and while full-size sedans, like the Impala, are large, the overall price is much larger compared to other car segments.
When factoring in gas mileage, initial pricing, maintenance and other ownership costs, large sedans tend to cost significantly more than crossovers and mid-size sedans, which are considered more fuel-efficient and trendy. “Even with the recovery now, consumers’ keyword in finding a car for the most part is value,” Toprak said. "The ownership costs of large sedans are generally speaking higher than cars that are smaller than them.”
But Johnson and other officials said they expect the 2014 Impala, which debuted last year during the New York Auto Show, to substantially increase retail customers, up leasing by about 35 percent, and bring in new, younger customers.
The vehicle will be offered in LS, LT and LTZ models, and three direct-injected engines: a 3.6-liter V6, new 2.5-liter four-cylinder and a 2.4-liter four-cylinder with eAssist. The starting prices for non-eAssist models range from just under $28,000 to $34,555. Pricing for the 2.4-liter engine with eAssist will be announced closer to its launch in the fourth quarter of this year.
Karl Brauer, editor in chief and CEO of TotalCarScore.com, said the 2014 Impala, thanks to its redesign and new options, is leaps and bounds over the previous generations, but so are its competitors.
In 2012, Impala captured 30 percent of the full-size sedan segment thanks to its fleet status. Through March of this year, the sedan’s percentage is down 1.5 percentage points, as its competitors gain ground.
“There’s been so much activity in that segment,” he said. “(Impala) is one important vehicle for the segment, but there’s like four others and they’ve all had something major happen to them in the last 24 months.”
The Impala’s top five competitors are Chrysler Group LLC’s Dodge Charger and Chrysler 300; Ford Motor Co.’s Taurus; Toyota Motor Corp.’s Toyota Avalon, which was redesigned last year; and the Nissan Altima, which went into production in July.
While the Impala’s market share of the large sedan segment has remained above 27 percent since 2007, its competitors have grown more in the same time period. In the last five years, the Avalon, Taurus and Charger have all grown at least 4.5 percentage points, including the Taurus increasing nearly 10 percentage points to 12.6 percent of the market.
To help bring attention to the vehicle, GM also launched a new Impala television spot as part of its “Find New Roads” advertising campaign, put one of the vehicles in center field at Comerica Park and launched a 36-month lease program for $279 a month on the Impala LT with a V6 engine.
GM expects to attract buyers from the Impala's direct large sedan competitors as well as other segments, such as crossovers and near-luxury brands, according to Johnson.
“We’re looking forward to grow segment share and really attract people from other segments into the large car segment,” he said.
The interior of the new vehicle also has been completely redesigned with Chevy’s dual-cockpit that features a new instrument panel with a standard 4.2-inch color display with reconfigurable features for the driver. An eight-inch touch screen with concealed storage, which resembles the automaker’s Cadillac CUE infotainment system, is available with the Chevrolet MyLink system.
If the 2014 Impala can live up to its iconic heritage is yet to be seen. But one thing is for sure, the vehicle’s design already shows that GM is serious about attempting to revive the nameplate and large sedan segment.
“Does it carry the old Impala soul in it? Not necessarily,” according to Toprak. “Is it more attractive for the times? Yes.
“It just sort of depends what your expectations are.”
For GM, the expectations are high.