By Deepa Seetharaman
DETROIT (Reuters) - General Motors Co
GM said the eight-cylinder engine on its new 2014 Chevrolet Silverado and GMC Sierra trucks offers a one-mile per-gallon (MPG) advantage to the Ford F-150 six-cylinder, turbocharged engine.
Fuel economy has become more important to buyers of pickup trucks, who traditionally have been more concerned with power, payload and towing capacity. GM has emphasized that its new trucks will offer a lower cost of ownership than the F-150.
"With the greater MPG of the new trucks, we expect GM to lower the fuel cost component by (about) $1,575, which would close the gap to Ford and widen GM's total cost of ownership advantage," Barclays Capital analyst Brian Johnson said in a research note.
GM also announced that the 2014 Silverado would cost the same as the outgoing model. The 2014 Sierra will start at about $500 more than the previous generation.
The largest U.S. automaker expects 75 percent of Silverado and Sierra truck buyers will opt for the 5.3-liter, V8 engine EcoTec3 engine, which costs an additional $895.
GM said both the 2014 Silverado and Sierra equipped with this engine and two-wheel drive get a combined 19 mpg.
The 2013 F-150 with a 3.5-liter, six-cylinder, turbocharged engine and two-wheel drive gets 18 miles per gallon combined, although the F-150 still offers more horsepower and torque.
Ford shares fell nearly 2 percent to $12.90, while GM shares were flat at $27.80 on the New York Stock Exchange. The broader S&P 500 index fell slightly.
PRESSURE ON NEW F-150
Analysts said GM's announcement puts Ford is under more pressure to deliver better results in its redesigned F-150 truck, expected for the 2015 model year. Ford showcased a concept version of the truck this year at the Detroit auto show.
Ford expects to boost fuel economy of its new F-150 by as much as a fifth, partly by using more lightweight materials. Its EcoBoost turbocharging technology is central to its push to dominate the market.
"Ford has made a lot of hay with EcoBoost in its pickup trucks," Kelley Blue Book analyst Jack Nerad said, adding that the GM announcement "shows that there is more than one way to skin the fuel economy cat."
Analysts expect truck sales to outpace the broader automotive market this year as the U.S. housing market recovers, allowing builders and contractors to buy new trucks.
Full-size pickup trucks accounted for a little more than 12 percent of U.S. auto sales during the first two months of 2013. The F-150 is the top-selling vehicle in the U.S. auto market.
On Tuesday, major automakers will report March auto sales. Analysts expect the report will show the fifth straight month that the annual sales pace has held above 15 million vehicles, a sign of the industry's continual recovery since the 2009 crisis.
MORE HIGH-END TRUCK SALES SEEN
GM expects to sell more high-end, crew cab editions of the Chevrolet Silverado and GM Sierra, both of which start around $33,000. This body style accounts for 50 percent of Silverado sales and just under 60 percent of Sierra sales.
GM expects this style to be 60 percent or higher of 2014 Silverado sales and 65 percent or more of 2014 Sierra sales.
The new trucks also offer lane departure warning, forward collision alert and other features not currently offered.
The starting price of the 2014 Silverado is $24,585 for the regular cab body style, $28,610 for the double cab and $32,710 for the higher-end crew cab style. Those same body styles for the 2014 Sierra start at $25,085, $29,110 and $33,210.
GM said a new 355-horsepower 5.3-liter V8 in the 2014 Silverado and Sierra is rated by the EPA at 16 miles per gallon in city driving and 22 miles per gallon on the highway for two-wheel drive and 23 miles per gallon on the highway for four-wheel drive.
(Reporting by Deepa Seetharaman; additional reporting by Paul Lienert; Editing by Steve Orlofsky and David Gregorio)