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GM's Bandwagon Shaped Like a Truck

Rani Molla is a Bloomberg Gadfly columnist using data visualizations to cover corporations and markets. She previously worked for the Wall Street Journal.
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General Motors on Wednesday reported third-quarter profit that beat analysts' estimates thanks largely to light trucks, highlighting Americans' renewed romance with the vehicles. GM has the biggest share of U.S. light truck sales, and its rivals should pay close attention.  Thanks to cheap gas and low interest rates, trucks are more attractive to consumers than ever. Even when gas prices rise, trucks have become more practically built for everyday driving.

Consumers have swung back and forth between cars and trucks along with prices at the pump since the 1990s, including in 2008. But they may no longer be scared back to cars so easily. Advances in technology have enabled automakers to build crossover vehicles that provide the utility of trucks with the fuel economy and driving dynamics of cars, according to Bloomberg Intelligence analyst Kevin Tynan. 

It's clear drivers are poised to make eyes at trucks for some time to come. GM is already capitalizing, and its competitors would be well-served by following suit. 

This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.

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