Paul A. Eisenstein is publisher of The Detroit Bureau. He has more than 30 years of experience covering the auto industry for a broad range of print, broadcast, and electronic media.
If the Sedan Dies, What Will Pros Drive?
The most popular vehicle type for real estate practitioners is on the outs, but new and improved SUVs may take its place, offering space and style for the modern agent.
March 16, 2018
At the auto industry’s most high-profile car shows in Chicago, Detroit, and Los Angeles over the past few months, there was a sense that something was missing. There were plenty of utility vehicles, pickups, and vans on display, but coupes, sports cars, and sedans—a popular choice for busy real estate professionals who often work out of their vehicle—were in notably short supply.
It’s not surprising given that nearly two-thirds of new vehicles sold in the U.S. last year were light trucks. The shift prompted Ford recently to cancel plans to redesign its once-popular Fusion midsize sedan. In January, Ford CEO Jim Hackett said the company will cut the volume of its passenger car lineup in North America and Europe. That translates into a 10 percent reduction in sedans, while light trucks—primarily SUVs—get a boost.
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Fiat Chrysler Automobiles, a REALTOR Benefits® Program partner, is going the same direction and no longer produces a single passenger car model in the U.S. The company scrapped the Dodge Dart to make room for more Jeeps, while the old Chrysler 200 was reconfigured for the new 2019 Ram 1500 pickup. FCA has a variety of other light trucks in development, including a new Jeep pickup and the three-row Jeep Wagoneer. “We made the right call three years ago by trying to disentangle ourselves from the passenger car market,” FCA CEO Sergio Marchionne said in January at the North American International Auto Show.
The simple fact of the matter, stressed Marchionne, is that consumer tastes are changing. SUVs are now the single most popular body style on the market, and sedans are rapidly losing ground. The Euro-American automaker—like its competitors—is focusing on the products the market demands, he added.
Other automakers are set to roll out new and improved trucks as well. But industry analysts say this time, advancements in fuel economy will spur demand, even if gas prices start to climb. Ford’s new F-150 Diesel model, for example, can hit 30 mpg. And Audi is set to launch a new all-electric SUV with a range of more than 200 miles. That’s good news for people such as real estate professionals, who spend a lot of time behind the wheel. The fuel cost gap has been all but eliminated, and there are some pluses to SUVs—especially newer, car-based models that offer plenty of interior space and amenities and much more comfortable on-road driving.
General Motors has been rolling out a procession of new light trucks, including the updated Chevrolet Equinox and Tahoe SUVs, as well as the full-size Silverado pickup. Imports are also ramping up their light truck lines, especially brands slow to get into the market. SUVs currently account for barely a quarter of Volkswagen’s U.S. sales, but the automaker hopes to double that share with the all-new Atlas and a completely updated Tiguan.
However, Toyota has one of the most telling tales. Its Camry sedan was not only its best-selling product line but the fourth best-selling vehicle in the U.S. Last year, it was usurped by Toyota’s RAV4 SUV and slipped to sixth overall in the American market, behind both the RAV4 and Nissan’s Rogue crossover. “With the strength of the SUV market, it’s no surprise that RAV4 was not only our best-selling model but the best-selling non-pickup truck in the industry,” said Jack Hollis, U.S. group vice president and general manager of the Toyota brand.
A year ago, Toyota’s Lexus brand introduced an all-new version of its flagship model, the LS. But sales have been lackluster, as has demand for competing models like the BMW 7-Series and Audi A8. This year, Lexus revealed the LF-1 Limitless concept, essentially an SUV alternative to the LS. And while the brand’s general manager, Jeff Bracken, wouldn’t confirm production plans, he says: “We clearly have a gap at the high end of the market we have to fill.”
As Mark Twain might have said were he writing about today’s auto industry, reports of the death of the passenger car have been greatly exaggerated. But sedans and coupes are set to become the exception rather than the rule in the years ahead.