If you have ever worked in the automotive industry in America then you have probably heard this: “American’s will never want to buy small cars.” On the whole, this was true one, even two decades ago, but the shift in interest in small cars is apparent. AllSmallCars.com caught up with George Pipas, Ford’s Chief U.S. Sales Analyst earlier this week to talk about the small car marketing in American and a little about hybrids too. What Pipas had to say was pretty interesting and if he is right, we will see more small cars coming to market as time progresses.
2012 Ford Focus
2012 Ford Focus
2012 Ford Focus
Back in 2008 we saw the rise of gas prices and by the end of the year a dramatic rise in small car sales. In fact, from 2004 to 2009 the percentage of U.S. small car sales had gone up some seven points. Then for the month of March 2011 the U.S. small car sales climbed to 24%--the highest they have ever been in the U.S to date. You might have noticed that in the 18 months that Ford has also revitalized their small car offerings. From the 2011 Ford Fiesta to the 2012 Ford Focus, there is a model that will fit just about anyone’s budget, size requirements or need for technology. So what is driving the small car market and how did Ford get ahead of the game?
According to Pipas, the small car market is growing due to the “urbanization of America” and the reality that the baby-boomer population is entering the empty nesters phase and are looking to downsize. Then you ad the rising cost of fuel prices and you have a market ripe for change. If you read “urbanization of American” and wondered what that has to do with the price of eggs, we have you covered. According to the last census, more people live in urban metro areas now than ever before in the history of America. This is causing more congestion, tighter living quarters and the need for smaller more efficient transportation. The small car isn’t your small car of 20 years ago though, now you can get them equipped with the same kind of luxury technology that you would find in a BMW 7-Series, Lexus LS or Mercedes S Class.
The above is important because as people in the baby-boomer generation age, there is a lot of downsizing that happens. Downsizing doesn’t necessarily mean that people want to give up luxury or technology, so we are seeing a change in small car design. Look at the all-new Focus available with Sync and a self-park feature that parallel parks for the driver. You can also look at the all-new Hyundai Elantra that offers front and rear heated seats. Now small car doesn’t mean economy car.
“An important point of view to have is that the pace of the world and the world’s tastes were starting to converge. This was made possible by the Internet and social networks and resulted in a changing of opinion of consumers.” said Pipas.
Bottom line—the small car market is changing and people are recognizing that they can drive a small car and still have safety, comfort and the ability to park downtown without needing a spotter to get their car into a spot. Oh and did we mention 40-mpg on the highway? Try getting that in your Crown Vic.