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Americans Still Shunning Small Cars Even As Gas Prices Rise

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Remember that frenzy of small car buying that occurred about two years ago? It was spurned by spikes in gas prices that sent consumers scrambling for fuel-efficient alternatives to their big SUVs. The mainstream media loved it and conservationists saw it as a vindication of their long-held belief that Americans would buy smaller cars with the right incentives.

Well, turns out that's only partly true. Bengt Halvorson over at TheCarConnection looked at a recent study by AutoPacific that shows just how quickly American buyers forget about fuel efficiency.

Sure, gas prices spiked in 2008, but they quickly came off their highs and settled into more reasonable territory. Sales of small cars faded while the traditional top sellers regained much of their previous popularity.

Since then, prices have been slowly creeping up. But has interest in small cars and hybrids come back? Nope.

When AutoPacific asked consumers in January of last year if they would consider a small car to replace their current car, 24% said yes. That number dropped to 12% by January of 2010.

During the same period purchase intent for SUVs went from 16% to 26% despite steadily rising prices.

Some people might say that the American car buyer is being too shortsighted, but that's nonsense. Car buyers typically consider what they want first and what they need second. Rarely does anyone want a small car, especially f they can afford a larger one. Unless gas prices keeping pushing up toward the $4.00-$5.00 range, buying a midsize car or truck is still affordable, and desirable, for the average car buyer. That's not going to change anytime soon.

TheCarConnection

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27 Comments

firstwagon says:

11:58 AM, 02/13/10

"Rarely does anyone want a small car, especially if they can afford a larger one."

That is one of the quirks of the American car buyer. Programmed for years that you must buy the biggest car you can afford rather then the smallest one that will do what you need.

It's hard for the rest of the world to understand why you can't see that small cars are better most of the time.

bc1960 says:

01:00 PM, 02/13/10

Size, per se, is not the real issue. Has the proportion of people choosing I4 vs. V6 midsizers changed? For some brands I4s were already more prevalent, for others V6s were. Whether or not the smaller car is really more efficient depends on what models you're looking at--Mazda is not known for efficiency, it's true, but the Mazda6 i is rated 21/30 mpg while the Mazda3 s is rated 22/29. A VW Passat 2.0T is rated 22/31 while a gas-fueled Jetta is rated 23/30.

Another thing to watch would be whether 2-or-more-vehicle families are still choosing to have more than one family-sized vehicle; or are they moving to one, plus smaller commuter/errand runner. Yet another would be if they are driving less, and/or with a lighter touch on the accelerator.

I personally would tend to choose a smaller car because I prefer the driving feel and ease of parking. But at the moment we are still stuck with many small cars not offering advanced features or desirable options--that has started to change and will change more over the next few model years, just as it did in the 1980s. New CAFE requirements don't start until the 2011 model year, and whether or not you agree with the approach, manufacturers have not yet needed to increase marginal prices for vehicles and options that reduce their numbers--again as they did in the late 1970s and early 1980s. And buyers have not yet been educated that some compact cars such as the Kia Forte have trunk space comparable to some mid-sizers, and for fewer than 5 passengers may not be much, if any, less comfortable.

brn says:

02:00 PM, 02/13/10

firstwagon,

Some of the rest of the world prefers smaller vehicles because they were forced into it. As such, the people and vehicles adapted to the need.

None if this should be used as an argument to degrade larger vehicles or to declare Americans ignorant.

1487 says:

03:05 PM, 02/13/10

firstwagon:

If people in the rest of the world lived here they would buy bigger cars. America is not built like Europe or Japan and thus small cars are not really a requirement. Most Americans live in the suburbs (not me) where parking and space is plentiful. This isn't Europe where many live in older cities and towns with tiny streets and no parking. In addition, cheap gas makes it EASY to avoid small cars. If gas was $2.80 in Europe you can bet people would buy different vehicles in many cases. Then again, even if gas was cheap the fact that space is at a premium combined with the fact that high speed rail is abundant make the idea of a large highway cruiser kind of silly.

Already some analysts are saying there are too many small cars coming to market over the next few years for the amount of demand that exists. Anyone who claims people dont buy small cars simply because there arent enough good ones available is totally wrong. There are PLENTY of small car choices out there and only 3 or 4 sell in large volume.

firstwagon says:

05:12 PM, 02/13/10

"America is not built like Europe or Japan and thus small cars are not really a requirement."

Canada is bigger then the US and we have the same endless highways, same suburbs and our gas (while more then the US) is a lot cheaper the Europe and yet the top 3 selling cars here are the Civic, Mazda3 and Corolla. The Accord and Camry came in 11th and 12th.

http://www.goodcarbadcar.net/2009/10/best-selling-car-in-canada.html


No one forces us to buy anything but small cars still sell best.

I didn't mean to call anyone ignorant but the endless downplaying of small cars as something you only buy because you have no choice or maybe as a 1st car is rather insulting too.

f1ndler says:

11:56 PM, 02/13/10

I agree with with firstwagon. I strongly believe that the desire to drive a bigger car is stimulated not by the market or need but by the mentality of people. Simple example. Look around while shopping at the groceries stores. Most people by more than they can eat. I'm not going to go into the detail about how and what they eat but even if you think about the fact that most SUVs are designed to go off-road but you see a lot of them in a city it isn't difficult to see the true nature of average American. I personally, and most if not all of my friends and family, against big cars for many reason but mostly it is cost ineffective. And when I see a truck in the city I know it's a rednack.

bodyblue says:

08:18 AM, 02/14/10

I dont think is is right or wrong what someone chooses to drive...it is their money and so they can buy what they want. Want a truck then get one, who cares what anybody else thinks? I dont want a gas hog because I dont want to spend my money on fuel. When I was younger I did not care but now I have different priorities. I hate it when the tree huggers think they are superior because of what they choose to drive.....or when the government rams crap down our throat. Let the market decide what people buy....that is democracy in action. One is not a "redneck" if you drive a truck or a "greenie" if you drive a Prius......but if you drive a S-class you are a capitalist pig stepping on the masses :) Just kidding Mercedesfan!

brn says:

09:50 AM, 02/14/10

firstwagon: "I didn't mean to call anyone ignorant but the endless downplaying of small cars as something you only buy because you have no choice or maybe as a 1st car is rather insulting too."

I think there are two camps. One that downplays small cars and one that downplays larger cars.

I'm tired of one. You're tired of the other.

roadburner says:

10:07 AM, 02/14/10

bodyblue;

EXCELLENT post. I despise people who profess to be able to tell me what I "need", as in stating that no one "needs" a V8 SUV/150 mph bike/500 bhp sedan/60" plasma/9mm semi auto with 15 round magazine/etc.

inlinesix says:

11:54 AM, 02/14/10


It's good to be able to get that 15 round magazine again right?

firstwagon says:

11:57 AM, 02/14/10

brn

Fair enough. I'll try to be less critical of other peoples choices.

(but I'm going to keep defending small cars)

roadburner says:

12:25 PM, 02/14/10

"It's good to be able to get that 15 round magazine again right?"

You bet.

1487 says:

04:00 PM, 02/14/10

"I didn't mean to call anyone ignorant but the endless downplaying of small cars as something you only buy because you have no choice or maybe as a 1st car is rather insulting too."

The fact is most Americans buy a small car because thats what they can afford or because they live somewhere were a larger vehicle is impractical to park or own. Considering the average midsize car is only about 10% less efficient than a compact car I don't see why you are so upset about Americans not being obsessed with compact cars. You aren't losing much efficiency but you are gaining comfort and utility. I don't think anyone is putting down small cars but the media and environmentalists went overboard with the predictions about Americans flocking to small cars. Small cars are only slightly more popular than they were before gas prices spiked, there has been no huge shift in demand contrary to what politicians, the media and hybrid lovers would have you believe.

billt9 says:

09:41 PM, 02/14/10

The incremental benefit switching from a midsize to a compact just isn't that worth it.
Midsizers typically have 50% to 100% longer cruising range due to their larger gas tank,
they don't suck that much more gas, and you get a lot more room to sleep in the car and move large stuff.

If the width of your country's roads don't force you to drive smaller, midsize is just perfect.

dino6 says:

11:40 PM, 02/14/10

I disagree with firstwagon. I have lived in Canada and in the U.S. for many years in each country. The reason Americans prefer bigger cars compared to Canadians are twofold: (1) Tax rates and incomes are slightly higher in the U.S. than in Canada therefore Americans on the average have higher disposable incomes. Therefore their favored cars are bigger because they can afford more expensive cars.
(2) There is a huge cultural difference between the 2 countries. Americans have a higher tendency to want to compete with their fellow Americans. My car is bigger, my house is bigger, my etc. is bigger. Canadians are more egalitarian and happy to accept the status quo of being in a community where everyone is more or less equal.

dino6 says:

11:41 PM, 02/14/10

I disagree with firstwagon. I have lived in Canada and in the U.S. for many years in each country. The reason Americans prefer bigger cars compared to Canadians are twofold: (1) Tax rates and incomes are slightly higher in the U.S. than in Canada therefore Americans on the average have higher disposable incomes. Therefore their favored cars are bigger because they can afford more expensive cars.
(2) There is a huge cultural difference between the 2 countries. Americans have a higher tendency to want to compete with their fellow Americans. My car is bigger, my house is bigger, my etc. is bigger. Canadians are more egalitarian and happy to accept the status quo of being in a community where everyone is more or less equal.

dino6 says:

11:44 PM, 02/14/10

Correction to above: I meant Tax rates are slightly lower and incomes slightly higher in the US than in Canada therefore Americans on the average have higher disposable incomes.....

brn says:

08:11 AM, 02/15/10

firstwagon, I'm starting to feel sorry for you (only a tiny bit). Every other blog seems to jump all over larger cars. Not so much in this thread.

Btw: I own one of each.

bankerdanny says:

09:07 AM, 02/15/10

Damn, that was supposed to be unapologetically

DLu says:

10:32 AM, 02/15/10

Boston is pretty darn cramped (a lot of streets that would be too narrow to allow ANY street parking in many other US cities would have both curbs stuffed full), yet a too-big proportion of people still drive huge SUV's and take up a ton of the spaces. Many people still seem to think that driving a big fat SUV is a sign of affluence. I guess it's understandable that someone might want to take up as much space as possible and stand out that way.

Of course there are people who also think "bigger is safer."

bankerdanny says:

12:50 PM, 02/15/10

What happened the first comment that I was correcting? What I said was that the back seat of the Fit is one of its best features and should be unapolgetically copied by all manufacturers.

mzbamf says:

08:31 PM, 02/15/10

Most people who drive big SUVs can't keep them in their lanes and pay less attention to their surroundings. Thats the only thing I care about and why I can't stand them. They seem to be an excuse for poor driving

firstwagon says:

09:11 PM, 02/15/10

I'm sitting here smiling reading all this talk about small cars as if the only advantages are mileage, price and ease of parking.

You just don't get it and I suppose if I grew up where most of the compact cars are automatics (or American) then I wouldn't either.

The advantage of small cars over mid size cars is they are much more fun to drive. You can toss them around, whip up and down through the gears and generally enjoy driving all without losing your licence (or dying). I've said it before and it still stands... a good small car is like a light duty sports car. (Cobalt, Focus and Caliper do not apply here.)

Sure an Accord is more comfortable then a Fit and when I'm old then I'll worry about that. Right now I enjoy driving and the Accord/ Camry / Fusion/ Malibu are about as much fun to drive as a rental car.

That they get better mileage, are cheaper, easier to park and if a hatchback much more useful is just a bonus.

Don't like it? Too bad. Get used to being wrong.

inlinesix says:

09:20 PM, 02/15/10

...I jump all over car companies that make poor excuses for smaller cars... Also, of the cars I look at, the lightweights get the nod.

brn says:

07:17 AM, 02/16/10

mzbamf: "Most people who drive big SUVs can't keep them in their lanes and pay less attention to their surroundings. "

Let's pretend your statement is accurate. If you put those people in a different kind of vehicle, would they suddenly become better drivers?

mikeolan says:

08:13 PM, 02/16/10

@Firstwagon: Allright, straight-up, you're wrong. Smaller cars aren't necessarily more fun to drive. Take for example a Nissan Sentra vs. Nissan Altima. Or a Toyota Corolla vs. a Honda Accord. The Fit isn't particularly fun to drive next to the previous-gen Mazda6, Accord, or Altima- the steering is numb by comparison, and after 20 minutes behind the wheel there's not even a comparison.

I test drove a variety of vehicles when making my last purchase and aside from the hecho-en-mexico VW Jetta, everything in the compact class felt cut-rate, be it the weak A/C system on the Mazda3, the lack of a coolant gauge, front lights, telescoping steering wheel, or armrest on the Fit (this was 2008 mind you) , the junky 4 speed auto on the Corolla, the cramped back seat that doesn't split-fold of the Civic, etc. Mid-size vehicles are simply more competent (and for some reason reliable) all around.

Second off, you're broadly defining "Americans" - the F150 is the top selling vehicle in the USA, but it's only a household item in certain demographics (particularly in the South where outdoor recreation / hunting is more common.) In the mid-west SUV's are common because they're roomy, durable, and unfazed by sludgy winters. Usually as a second car you've got a mid-size sedan (anywhere from a Civic up to a Taurus) that can take on the road trip and still score better mileage than a Fit.

I don't know what makes Canadians think they're an expert on American culture. It's like the fat brother of a cool kid who compensates by always talking smack about his sibling.

blueguydotcom says:

07:26 AM, 02/18/10

mikeolan, you are right that Americans get the cut rate small cars. Europe flat out has better small cars than we get here. That said, today's Golf/GTI actually feels like any near luxury midsize. It feels that good. Shocking but sadly VW is the only one selling small cars that nice.

On your comment about the fat brother, that's the American in the analogy, right?

FWIW, I'm a big fan of small cars but I had a friend's extra Titan for a month for house projects. Gotta say that thing was really useful. I seriously considered buying a used one for my daily driver as I could see how it would be a great vehicle to have around. And that thing is silly quiet compared to my BMWs.

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