Interesting article in today's Wall Street Journal (click here to read) about the declining interest among U.S. consumers for small cars. Of course, these days there's a declining interest in just about anything that costs money, but stay with me on this. The basic premise of the article is that in normal times, when given a choice between a small car and a large car, most Americans will opt for the large car.
The reasons are partly cultural (Americans love to stuff every square inch of their vehicles with both passengers and paraphernalia, as any parent of a school-age kid could tell you), partly geographic (those micro-sub-compacts may work just fine in island nations like the U.K., but those cross-country trips to Grandma's in the U.S. would wreak havoc on most spinal columns in subjected to driving with your knees in your chin for eight-hour stretches), and partly sociological (can't you be just as environmentally-conscious driving a Highlander Hybrid as a Prius?).
On the other hand, check out this IW news article about what a no-frills auto really looks like. If you want a brand-new car for only $2,000, and don't mind giving up things like automatic transmission, air conditioning and power windows, then the Tata Nano might just be what you're looking for.
The issue is not size of car, it is the Marginal Cost of Transportation. Used cars of all sizes are preferred over small expensive cars. Or small throw away cars that have a short life..
Physical size or mileage is not the dealbreaker for most Americans that total monthly cost and cost of ownership are. Indeed this is true thoughout the world, otherwise used mercedes cars and toyota land cruiser trucks would not be ubiquitous around the globe.
The Tata Nano has been eagerly awaited since it's introduction. It promises a combination of low cost and small size.
There is and has been a huge market for small cars in the US. It coincides worldwide with the market for inexpensive cars and transportation.
It can be divided into 6 main segments; (a) A 2nd car for about any household "grocery getter or commuter", (b) city dwellers with limited parking, (c) young people, students and families with limited income and limited load needs (d) retired folks with a need for a smaller vehicle. (e) Utility vehicles for flower and pizza delivery, meter readers, curriers etc. (f) small utility load haulers, 2 or 4 seat, flat or closed bed, 2 or 4 wd for tradesmen etc. (g) small van, 6 to 8 seat, utility, delivery.
The 3 classic 1st generation vehicles in this segment that come to mind are the model T, the beetle and the Jeep. 2nd generation are the VW van, English Mini (a entire range in one type), and toyota/datsun/vw pickups. 3rd generation are the toyota previa, suzuki samuri, Geo metro.
Factors that work against many small cars are (1) lack of durability (2) high repair and insurance costs (3) marginal mileage, 25 mpg is NOT high mileage. (4) limited usefullness and load capacity (5) bad ergonomics, too low, cramped. (6) low ground clearance, poor traction, poor in snow, potholes, mud.
I would agree, that all other factors being equal, US car buyers would prefer a larger vehicle. I know that I would prefer a mid size or larger vehicle over the "Executive Speck"
I don't think it so much a matter of size as it it features.
Would car buyers prefer a more fully loaded with creature comfort small car over a more spartan larger car?
Personally I lament the lack of the true economy or base model vehicle in any size. It seems the car makers load them up with geegaws and gadgets I would prefer not to have, but then do not offer the "plain jane" version
That is one of the reasons I migrated to trucks in the 80's you could still get one with window cranks, vinyl seats, AM radio. I preferred to put my money in the engine and powertrain supension parts than a bunch of unecessary power accessories. As I get older more creature comfort is desirable, such as Air and cruise, but I still don't need power windows and seats or heated steering wheels As my granpappy used to say "its just more stuff to go wrong with it"
Nowadays I am shocked to find out that in some cars and trucks the manual transmission is the extra cost option!
__________________ Who ever heard of a skilled labor shortage that did not have a corresponding upward pressure on wages?
I am just not part of the market for high lux, high cost, high depreciation, and small size.
Some local dealers have the small cars in stock - but I have seen ZERO advertising for them, and when we went down with the kids to get them a car, the salesmen didn't want to show them too us - they steered us toward the more expensive cars and trade-ins.
The smaller vehicles do have a lot going for them, I drove a Samuri as my primary commuting and off road vehicle for 12 years, '87-'99. I purchased it with 9 miles on the clock. I was one of the first to take a Samuri to Moab. I didn't have to drive it - I also owned an M-37 Dodge with a full roll cage, 350 chev motor, 5 speed manual tranny and 42" tires on Rockwell axles, a Dodge "mash" ambulance, CJ-5, a crew cab F-350, a couple of F-100's, an ex-Air Force D-500 crew cab, and an Astro van, some rabbits, an opel, taurus, and some toyota pickups.. Though not all at the same time.. . I liked the Samuri, it got good mileage, all day on forest roads on 7 1/2 gallons. It was tolerably fast, 65-70 in the freeway, great offroad, and had a full frame, solid axles and closed knuckles - I picked it instead of the Jeep because of the axles. It was a scaled down M-37. It was quiet and light on the trails. The small size let me pick a path where larger machines had to take the obstacles as presented.. After 250,000 miles it is waiting for an engine rebuild. It would haul 5 hunters and 4 deer, or (4) 11x20 millitary tires in a pinch. I have a photo somewhere of it pulling a 20 ft flatbed trailer with a full size dodge on board! (across town only) (look at 4 Wheel and off Road Magazine if you wonder about the terminology)
To really apreciate the beetle, you have to get in one after a really hard day, the old beetles were pretty good ergonomically.
The temptation to build a small vehicle too light must be tremendous, the number of cars that I have seen with ripped out seat brackets, flopping bumpers, and crushed supension members is all together too many. Almost all have been small cars. Mileage is a product of two factors, wind resistance and weight. wind resistance is inherently small with the small vehicle, but light weight is only benificial if the basic vehicle is not so compromised as to unusable - too many small cars suffer from this problem.
The last two new vehicles my wife and I have purchased have been a 2005 Jeep liberty ( GREAT ALL AROUND VEHICLE ) and a 2008 D-1500 (4.7L flex fuel) to pull a 20 ft travel trailer, we traded the liberty for the D-1500. Even with high gas prices, we had to have a reliable vehicle that had enough metal to do a specific job. Both were financed by Chrysler Credit.
The dealers are quite a bit to blame, for the lack of logically spec'ed and priced small vehicles. The Dealer is the factories primary customer. What the dealer orders, the factory builds, and the customer buys. I have followed the base model vehicles for years, seems that the local dealers won't order them in, and won't advertise them when they do get them. - Cars or trucks.
The biggest systemic marketing problem is how they pay salesmen - by commission. The sales mans goal is to upsell the customer, not to deliver what the customer needs or wants.
Of course the weakest link the past 9 months or so has been financing. Several friends have been unable to buy the new cars or trucks they were looking at - even at cut rate prices - simply because there was no money being loaned.
I drive a 4WD Ford Ranger (I bought it when I lived up north and now wish I did not have the 4WD), and my wife has a Honda Pilot. Both are less than 5 years old and long ago paid off. We average about 18mpg between them. We drive an average of about 250 total miles per week (of course vacations or travels to long distance volley ball tourneys and other kids events add to that).
250 miles at 18mpg is about 14 gallons of gas per week. If we had 2 cars that averaged 28mpg (either 2 smaller cars or one very small car) we would use about 9 gallons of gas per week. 5 gallons of gas per week even at $4/gal is not worth a smaller vehicle to us. For sure that does not justify running out and spending $20-$30k on a new better mileage car for us.
I am on my second ranger based vehicle. My first was the 1987 4x4 and the second the mazda b series
I have never owned a more reliable and sturdy vehicle than my rangers - low cost of ownership and little more that normal maintenance is ever needed.
Ford is foolish to kill off this product, just as it was the Taurus. Although they did give it a stay of execution for 2 more years. The Ranger still gets the highest mpg off all compact trucks including the japanese brands.
The key here is that both of these vehicles are basic transportation, with little in the way of costly and unecessary, weight and power robbing power accessories.
It seems to me that a car maker who comes out with a good solid reliable, reasonably priced car with minimal options and basic features would have a hit on their hands. why do you need 10 cup holders when 2 will do?
__________________ Who ever heard of a skilled labor shortage that did not have a corresponding upward pressure on wages?
I drive a 93 explorer, -based on the ford ranger! 270,000 miles, a relative bought it new, I am the 3rd driver in the family. The Dodge is my wife's. As for gas, we both fill up once a month. We use the 4wd a lot in the winter. I just turned out the hubs this week.
I do not understand Ford, killing the Ranger. The only reason I can see is the "dealer factor" The dealers want the commisions. If they up-sell the customer, they order and offer to the customer what they make the most money on.
The local ford dealer sells full size Ford pickups and the new big Nissans, he doesn't sell the ranger/explorer size vehicles or the smaller Nissan trucks. He won't even order them it, or give a price on one.. Same with the GM dealer, he only sells the full size ones. Neither will sell commercial however. Not enough margin.
To buy a smaller Ford or Nissan we would have to drive 40-100 miles.
Ford had problems with the Taurus and Tempo, too many shortcuts and cheap cheats for such nice cars. The temptation to cut a couple of cents, to thin down plastic in order to cut cycle time, to change types of plastic to save 2 cents a pound , to put in a little bit cheaper transmission part. Yes, over a long production run, it can save money - but at the cost of a lost customer??? It cuts the life of the car in half. - Doubling the cost per mile.
Detroit as a whole got way to caught up in cost cutting on products. Should have cut costs in the executive suits.
We have had 3 taurus's in the last 10 years. One spun a rod bearing, at 110,000 miles, one had transmission failure at 120,000 miles, one had so many window, door handle, transmission and interior problems that it was gladly sold by the son in law at about 120,000 miles. I loved driving them. Hated wrenching them. If Beechcraft could put that taurus cabin in a twin, they would sell some airplanes.
We bought 2 new tempos the same time as the explorer, they are long worn out. We are putting a new head on a third. Warped..
The taurus is the poster child for a car that had potential. If they had put some quality, defined as "Good parts that don't break" into it, they would have built a lot more of them. An american 3/4 ton truck with 120,000 miles is still worth $12,000 on the dealers lot. A taurus with 120,000 miles is worth $120 scrap. -In my experience.
You are so right wes about trying to buy a base model vehicle
last year I had cash in hand to buy a new ranger before they quit making them. Got the total run around from the local dealers. kept trying to sell me on ones I didn't want, or upsell me to the F series. None was willing to order exactly what I wanted. an XL 3 liter 5 speed supercab with extra payload option. Never the less, in the end I just decided to put some money in my Mazda and keep it going a few more years
True about the taurus as well. a good solid car that could have been but too many corners cut on quality, our sable leaked every possible fluid - stains to this day on the drive way. But Ford had it almost right and it was the best selling vehicle thru most of the 90s
if they came out with an equivalent no frills basic transportation vehicle again today but improves the quality they would have a hit again IMHO
__________________ Who ever heard of a skilled labor shortage that did not have a corresponding upward pressure on wages?
I don't think it's a question of whether Americans like small cars or large cars . . . I think Americans want to drive what is in fashion or the latest status/style. It's simply that the latest auto fashion has been large SUVs.
One of Detroit's huge failings has been to bank their industry on making vehicles for which they could charge an extra 20%+ because of fad/style/status, and ignoring the bread-and-butter lines. This model works great for consumer/fashion goods like sneakers or jeans, for example, which can change style direction in a mere season with relatively small cost. But a vehicle assembly line costs billions to tool-up for, with a multiple year pay-back in the investment. Over time the car company is then stuck with cranking out cars that are less and less desirable at lower and lower margins. The capital commitment is just too high to run a car company on a consumer goods marketing model.
Whether it's SUVs, minivans, fins, or woodie-station wagons, the US automakers will ride the fad into the ground. Then they go through the obligatory restructuring lull until they catch the new wave. How many times has GM "restructured" in the last 30 years? Conservative columnist David Brooks went so far as to say that GM is not in the automobile business, but rather the restructuring business.
But (using the Japanese companies as an example) the workhorses of the Toyota line are and have been the Corolla and the Camry; likewise the Civic and Accord for Honda. Other models contribute to their overall market mix, but they invest the heaviest in maintaining their plain-vanilla everyday-transportation lines, year after year and decade after decade. I believe that both the Corolla and the Civic are both over 30 years old (maybe even 40) . . . is there a comparable Detroit model that's even HALF that?
Forty-five years ago, Japanese carmakers had less than a 1/2 of 1% share of the US auto market . . . last time I checked, it was a **teensy** bit better this past year . . .
The Honda and Toyota cars you wrote about have kept the name, but gone through several model changes. I can't think of a US model that has been as successful, but then the US tends to use a single platform across multiple pricepoints. Funny thing is, doen't seem to matter what price point you hit, with US cars, the companies cut to many corners. People get sick of them breaking.
As for the longest lasting models- they are mostly truck type vehicles.
The ford pickups lost their fenders in '57 and have been had major changes in 67,80, and 97. with minor changes in between. The best mileage and cleanest design was probably the 67 type, the 1/2 ton with a 240 I-6 would average in the high 20's for MPG. As for calling these a single model,, most major assemblies, axles, engines, beds, accessories, transmissions, etc will swap fairy easily across the years.
Chevrolet Pickups lost their Roly Poly look in 57. The C/K series was introduced in 1960 and is argueably the longest running model in the US, lasting for 39 years. These trucks had almost completely interchangeable engines, transmissions and axles with some parts still bolt-in today after 49 years. I drove a '79 half ton with the I-6 engine that averaged about 25 MPG. These drivetrains were shared across many car and van lines as well. The Astro Van was a version that was known as the safest vehicle in America, was known for going 300,000 to 800,000 miles in Fleet use, and I had 2 with 4.3 fuel injected engines that got 22-24 mpg consistently.
Dodge pickups have had a similar record. It is interesting to note that Chrysler has produced many if not most of the axles and transfer cases for all US light trucks for the last 68 years.
All 3 makes have been so close that parts are commonly swapped across brands by enthusiasts.
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The champion of us car models Is the 68 year old open topped Jeep. This began as an army scout car by Bantam in 1939, was redesigned by Willeys Chrysler and Ford, reached the army in 41, and is still built to about the same specifications. Most WW2 models were built by Ford. Models in the 60's used GM engines. Now owned by Chrysler. Properly equipped it will get mileage in the 20's and is light, easy to drive and takes up comparatively little parking space.
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Now, if the car companies would just build cars that don't break.
Do Americans Actually Like Small Cars?
As my granpappy used to say "its just more stuff to go wrong with it"
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