Exactly how much time do Ford and GM have for a comeback? Two model years at most, I’m afraid

Now it’s a horse, errgh, car race.

The prize, market share in the U.S. car market, will go to the company that can get new models out the door and into showrooms fastest.

That, and not the fate of low volume $40,000 bragging rights cars like the all-electric Chevy Volt, will determine if General Motors (gm) stays No. 1 or gets lapped by Ford Motor (F) or Toyota Motor ™.

In July GM’s share of the U.S. market dropped to less than 20%. Ford edged by Toyota to take second place with a 16.1% share. Ford’s gain in market share, as well as the a stunning $2,000 gain in the average transaction price for each vehicle sold, was a result of new models, such as the Fusion hybrid, hitting the show room floor. New models bring more people into a dealership, command higher selling prices (and lower discounts and cash-back awards), and sell better, at least initially than older models.

“Cars are like donuts, Ford CFO Lewis Booth, told a press conference on August 5. “The ones you want to buy are the fresh ones.”

That’s why Ford plans to replace about 90% of its North American product lineup by 2012.

And why General Motors, not to be topped, told reporters at the flashy announcement of the Chevy Volt’s 230 miles per gallon mileage rating from the Environmental Protection Agency, said it will launch 25 new models by 2011. Read more