Small Cars Are The Biggest Deal

Issue #218

​Are you looking for your next car? If so, would you buy a sedan? That’s what many Americans are doing, and today, we explain why.

Or, you can continue to read by scrolling down.

Market News

• Ford's CEO says it's their responsibility to make sure cars sold in the US are affordable. Here’s more on his statement.

• Stellantis says it’s addressing its quality problems, but it’s not a new issue, nor is this a new discourse.

• Hyundai and Kia set quarter sales records. EVs continue to tumble. Here are all the Q3 results.

• The gasoline-powered Dodge Charger is outselling its EV version. That’s no surprise, but the ratio is.

• Here’s why Chrysler’s last vehicle is hanging in the balance after the union and automaker can’t reach an agreement.

Safety and Recalls

• Volkswagen is preparing for its largest recall since Dieselgate, affecting 200,000 vehicles in the US. However, the global impact is this large.

• Ford issues a recall as front lights can fall off these trucks.

Car Culture

• The Hummer H2 was huge when it came out, but did you know there are five new SUVs that are bigger? Here they are.

• Ford has created a level-activated e-brake. Yes, this means you could do handbrake turns.

• BMW will put ads in cars. Yup. You read that right.

• Here’s how it wasn’t Americans who gave up on station wagons. Automakers did.

• 0.001 seconds is the difference between son and father in the NHRA final. Here’s more.

Video Of The Week

What does it feel like to drive all the sport SUVs in the market? This video explains.

In The Know

Small Cars Are Selling Like Crazy

Twenty years ago, two out of every three cars sold were sedans, as explained here. They were, by definition, the go-to purchase for anyone wanting a sensible, practical vehicle. Practically every automaker had at least one sedan on the market.

Now, around 15% of new cars sold in the market are sedans. We all migrated towards SUVs or pickup trucks because we felt we got more bang for the buck. This article gives you the 14 reasons why, including more ground clearance, more cargo room, and seemingly more power.

From a manufacturer’s perspective, the SUV was also more profitable. If we think about it, it makes perfect sense. Technically, the SUV and the sedan are basically the same. Their construction process costs manufacturers around the same. However, once complete, car makers can charge more for the SUV because it “offers more.”

So, automakers that quickly turned their attention to SUVs and all those that did are regretting it.

That very same quest for profit is biting back at them, and it’s all thanks to rising costs, but we’re not talking only about new car prices, which are steady at  $50,000, as you can read here.

By the way, SUVs are driving that $50,000 average.

Everything is more expensive. As this article explains, repairs have increased twice as much as inflation. That’s a 60% increase from 2019 to 2026.

Then, there’s fuel. We covered it last week, and there seems to be little in the way of a solution in that sense, as geopolitical tensions don’t diminish.

So, what’s the solution? For many, it’s to opt for a smaller vehicle, and the numbers are showing a clear tendency. The Camry might not be the smallest vehicle on the market, but it’s Toyota’s best-selling vehicle, just slightly above the RAV4, as you can read here.

Honda, on the other hand, has seen much more aggressive sales jumps. The Civic is consistently growing while the Accord grew by 33% year over year.

Mazda is also enjoying a solid sales performance, thanks in no small part to the Mazda3. This has got to be one of the best small choices out there, and people love it. Autoblog reports that its sales grew by 150% Year-to-Year!

Overall, compact vehicle inventory rotation is faster than SUVs at a time and, as this article highlights, this vehicle type is slowly taking over market share. That’s even with a very tight profit margin.

The cycles that make us buy a certain vehicle type will remain. Yet, it’s also interesting to see that more and more automakers are bringing back their sedans. The fuel will, hopefully, not be as expensive as it is now, but we might be seeing a change in consumer behavior that won’t be temporary. What do you think?