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Small Cars Take a Back Seat to Crossovers

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author photo by Autotrader January 2011

The small car segment is not doing so sweet but crossover sales are on the rise, says analyst Rebecca Lindland of IHS Automotive. When we asked about her recent interview with USA Today, Lindland explained, “I express concern about growth in small cars because...there isn’t any. We are seeing share AND volume growth in crossovers, but we are not seeing the same in small cars.”

IHS has the statistics to prove it. In 2007, the difference between small car sales and CUV sales revealed 27,000 units in favor of small cars and a +0.2% share advantage. Skip to 2010 and research shows that CUV sales are in the lead by 557,000 units. Percentage wise that’s 21.2% share over 16.4% for small cars.

 “Consumers are already making the move to more fuel efficient vehicles - but they are choosing CUV’s, not small cars,” notes Lindland.

To determine their data, IHS Automotive has three segments for “small cars”. The first, Subcompact A, is currently populated by just one car – the Smart ForTwo. Yet, the tiny car cache is growing. The Fiat 500, Chevy Spark, Mitsubishi i-MiEV, Mitsubishi Colt, Toyota iQ and Nissan Micra are expected to come stateside by 2015.

IHS predicts that Subcompact A will reach 146,000 units by 2015. Yet, Lindland remains apprehensive. The analyst adds, “My concern is that this figure is less about consumer pull and more about OEM push onto the market.”

The second segment, Subcompact, also comprises a tiny part (3.5%) of the market. Highest sellers in this area include the Versa, Honda Fit and Hyundai Accent. But with new vehicles from Suzuki, Chrysler, Dodge, and VW due in 2015, it’s estimated that Subcompact will nearly double in sales to 950,000 units.

“Again, this is more about OEM’s pushing volume with new products than consumers pulling on demand,” says Lindland.

Lastly, the third “Compact” segment is also blooming. ”Because of all the new products coming in, we are estimating sales to grow to 2.7 million units in 2015. These new products include the Prius MPV along with new products from Chrysler, Dodge, Ford, Buick (the Verano), and of course a slew of new hybrids,” says Lindland. 

Yet, a growing product count does not necessarily convert to consumer demand. Lindland concludes that there’s more potential in the crossover segment than in the above mentioned small car trio.

“When we look at all crossovers (car-based SUV’s like the Toyota RAV4, Ford Escape and Edge, and Chevy Traverse), we see a very different story. Share grew to 15.1% in 2008, 18.7% in 2009, and 21.2% in 2010. Because there is not a tremendous amount of new products added and because of the emphasis on smaller cars, we are expecting share in this segment group to level out and stabilize around 21.5-22% in 2015. We ARE seeing consumers demanding these kinds of vehicles and the growth in volume and share shows that.”

This image is a stock photo and is not an exact representation of any vehicle offered for sale. Advertised vehicles of this model may have styling, trim levels, colors and optional equipment that differ from the stock photo.
Small Cars Take a Back Seat to Crossovers - Autotrader