Mid-Size Cars Feel the Sting of SUV Popularity
A new study of Americans’ car-buying habits confirms what many have suspected: that the SUV soon will overtake the sedan as the standard American family car.
Mid-size cars, the auto industry’s mainstay vehicle segment that includes the best-selling Toyota Camry, Honda Accord and Ford Taurus, are losing customers to sport-utility vehicles and “crossover” SUV/passenger cars at a much faster clip than just two years ago, according to the study released Tuesday by market research and consulting firm J.D. Power & Associates of Agoura Hills.
Shoppers for upper-mid-size sedans, such as the Camry, Accord and Taurus, are about seven times more likely to switch to an SUV now than they were in 1999, according to data collected by Power.
Two years ago, 2% of customers shopping for upper-mid-size cars actually switched and bought SUVs, according to Power. Now that number is 15%, Power spokesman Mike Greywitt said.
The finding stems from new-vehicle sales data obtained from more than 5,000 auto retailers in 21 U.S. markets, which Power combined with data from its own studies and sales forecasts.
The industry has known for years that light-truck sales were overtaking passenger car sales, and the U.S. vehicle market is now more than 50% light trucks, which include pickup trucks, SUVs and minivans. But there have not been studies until now that put a finger on which passenger car segments have been giving way.
“A key ingredient in the industry is crossovers, which are for the most part a subset of sport-utilities,” said Tom Libby, who handles dealer transaction data for J.D. Power. “There was only one crossover vehicle in 1997, but there are 18 on the market today.”
Crossovers, such as the Lexus RX 300, Acura MDX and Ford Escape, have a car-like ride and handling along with the versatility and cargo capacity of trucks. “Crossover appeal is hard to match,” Libby said.
The numbers are not good news for the mid-size passenger car segment, said George Peterson, president of Tustin-based consulting firm AutoPacific.
“SUVs killed the sporty-car market and the compact-pickup truck market,” he said. But he added that “it’s difficult to put the drain completely on one car segment because the appeal of SUVs has become so broad-based that they’re pulling [sales] from all car segments.”
Among buyers of 2000 model mid-size SUVs, for instance, 33% previously had owned similar vehicles. But 13% had owned smaller, 4-cylinder mid-size cars, 10% had owned small cars and 6% had owned upper-mid-size 6-cylinder cars, according to AutoPacific’s data.
The upper-mid-size car segment is the dominant sector in the industry and, besides the Camry, Accord and Taurus, is crowded with such models as the Chevrolet Impala, Pontiac Grand Prix, Oldsmobile Intrigue and Saturn L-Series--all from General Motors--and the Nissan Altima, Volkswagen Passat, Mazda 626 and Mitsubishi Galant.
But the segment’s market share is shrinking.
Though part of the decline, of course, is due to the general movement to light trucks from cars, mid-size cars have lost more customers than any other car segment, Libby said.
“The decline of the upper-mid-size segment will continue,” Libby said. “Our forecast indicates that sport-utilities will replace mid-size cars as the most popular vehicle in the country within the next five years.”
J.D. Power’s data, electronically collected nationwide, includes more than 200 details from each new-vehicle transaction, such as actual transaction prices, rebates, incentives and customer demographics. The study released Tuesday is the first of five market assessments that Power will release this year.
(BEGIN TEXT OF INFOBOX / INFOGRAPHIC)
Passing Lane
Although the best-selling passenger cars in the U.S. showed mixed sales results from 1999 to 2000 ...
*
... the country’s three top-selling light trucks all showed sales gains.
Source: Automotive News Data Center
