Thursday, July 12, 2018

Why are passenger cars fading and crossover vehicles ascendent?

A 1980s AMC Eagle -- was this the first crossover, with its 4 wheel drive and raised height? 


There are many reasons why there is some rationale to Ford Motor Company's decision to stop making passenger cars (except the Mustang) beginning in 2019. In preparation for a media interview this morning I am going to write down some of my thoughts on the topic. I apologize if I am going to ramble a bit.

First, I would argue that the average American consumer really does not care what his or her vehicle looks like, within certain limits.  That is why so many of the crossover vehicles look closely alike, from the front, rear, and side. One difference -- a concession to those seeking status -- is the brand badge that is featured so prominently on the front grill. That 4 ring Audi badge, three star Mercedes symbol, BMW blue and white propellor, or even Nissan or Toyota badge day something about you, whether you like it or not.  But the shape of the vehicle? Hardly a concern.

Unlike a passenger car where one has to bend more or less to get in, the crossover rides high and is easy to set into.  For an aging population, and one where a large percentage of Americans are obese, the crossover wins. SPACE -- in front, with enhanced legroom, dominates the one's experience in sitting in a crossover. One has a command seating position, plenty of room for large pets (Subaru certainly is pet friendly). Subaru also touts a "go anywhere lifestyle," although most crossovers never leave the suburbs.  But that doesn't matter, because the crossover owners still thinks in terms of freedom, although for many it is an illusion.  Handling is better than a SUV when one has 4 wheel drive and stability control.  And it seems everyone can live with crossovers -- rednecks, Birkenstock folks, farmers, younger apartment dwellers, Republicans, Democrats, Libertarians, Gays, Greens. SUVs, on the other hand, were hated by many, and prone to overturn.

Station wagons once were flexible passenger car variants that could fulfill many of the requirements of today's crossovers, but the wagon, like the open car and convertible has fallen out of favor, and its very small market (1.1% and fall since 2000) is met by German and Japanese (technically the Subaru Outback) makers. As late as 1976 wagons comprised 10% of yearly vehicle sales. What happened?  Among other things families have shrunk, from 3.3 people in an average household in 1960 to 2.76 in 1980 and 2.54 today. Many live alone (27% in 2014 as opposed to 5% in 1920, and 15% of households are women living alone. We are a very different society than in the 1950s, and along with changing consumer tastes, different needs.

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