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Hummer's H3 thrives in slow SUV market despite higher gas prices

JAMIE LAREAU | Automotive News
Posted Date: 10/11/05
DETROIT -- General Motors, like the rest of the industry, has seen SUV sales crash. But Hummer has managed to hit its launch targets for the mid-sized H3.

Hummer sold 4,054 H3s in September and 18,290 since launching it in late May.

Last year Susan Docherty, Hummer's general manager, projected about 25,000 H3 sales this year.

The H3 has Hummer's in-your-face styling, but with a smaller size, decent fuel efficiency and a lower price, Docherty says.

"Anything that was our Achilles heel in this brand has been addressed in the H3," Docherty told Automotive News.

For example, the H3 gets 20 mpg on the highway, compared with its larger sibling, the H2, which gets about 16 mpg, Docherty says.

The H3 has a 37-foot turning radius, beating the H2's 43.5-foot turning radius.

Also, it fits into most garages -- a complaint about the H1 and H2, she adds.

And 42 percent of H3 buyers are women compared with 26.3 percent with the H2, Docherty says.

Rob Huth, sales manager of Hummer of Orlando, Fla., sells 80 to 90 H3s a month. He says its popularity comes down to price.

"It's a less expensive vehicle yet shares the same parameters of the other two vehicles," Huth says. The H3 starts at $29,500, including shipping. The H2 starts at $53,855, including shipping.

Total Hummer sales for the first nine months of this year rose 82.5 percent to 37,017, from 20,284 in 2004. Docherty has said she plans to sell "north of 50,000" Hummers this year.

That would be a stark contrast to the industry at large in which U.S. automakers saw truck-based SUV sales plunge 32.2 percent in September compared with September 2004.

Analysts credit much of that drop to high fuel prices.

"SUV buyers are at a point of waiting to see what happens," Jim Hall, vice president for industry sales at AutoPacific Inc. in Southfield, Mich., told Automotive News. "The H3 is a cusp vehicle for buyers sitting on the edge deciding whether they want to commit to a large SUV or not. This gives them a way to go."
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