SUVs are out. So what's hot now? SUVs.Crossovers like the Toyota Highlander and Lexus RX330 are replacing traditional truck-based SUVs in customers' hearts. (Fortune) -- Ten years ago this month, Fortune published a story I wrote headlined "Death of the Sport Utility Foretold." In it, I argued that crossover SUVs (which we called "SUV Lites" at the time) would eventually replace conventional truck-based ones because they are lighter, cheaper, and more entertaining to drive. The Toyota RAV4 (link goes to 2006 version) was the first harbinger of this trend but others were not far behind.
Well, ten years have passed and the RAV4 is now in its third generation, but the prediction has finally come true. Sales of conventional, truck-based SUVs in all sizes are falling faster than a rock down a well. Full-size ones like the Ford Expedition and Chevy Tahoe are piling up on dealer lots because of buyer disinterest. And Automotive News, a trade weekly, reports that sales of four of the most popular mid-size SUVs - Ford Explorer, Dodge Durango, and others - have declined 20 percent to 30 percent for the first half of 2006. General Motors is reportedly getting ready to stop producing one of its midsize entries - the Chevy TrailBlazer - in 2009. The final nail in the coffin, of course, is $75-a-barrel oil, something that couldn't have been predicted with certainty ten years ago. But the broad outlines of the trend are as visible today as they were back in '96. Customers are getting older and they are tired of clunky, rough-riding SUVs that have been derived, for the most part, from pickup trucks. Most of the benefits they get from SUVs - versatility, all-wheel-drive, high-seating position, rugged appearance - are available in vehicles derived from passenger cars that are friendlier to drive and ride in, as well as being more fuel-efficient. Examples: Toyota's Highlander and Lexus's RX330, both of which are based on the Camry. Crossovers have become the fastest-growing product segment. By one count, there are 41 crossover models on the road today with as many as 50 expected before too long. Sales of crossovers are expected to pass traditional SUVs this year for the first time. Crossovers are also stealing sales from minivans but that has to do more with image than functionality. Customers can't shake the idea that minivans are utilitarian suburban vehicles for soccer moms and they can't wait to get out of them once the kids are grown. That's created some strange product definitions. The new line of seven-passenger carriers from General Motors, which will be sold as Buicks, Saturns, and GMCs, essentially mimic the function of minivans because they are useful as people-movers. But because they have traditional hinged doors instead of sliding ones, and styling that is less boxy, they are classified as crossovers. Crossovers have also blunted the revival of the family-favorite station wagon, which has re-emerged as a 21st-century "sports tourer." DaimlerChrysler has tried to revive this segment by producing long, low-roofed vehicles with three rows of seats and a tailgate. Their names are Chrysler Pacifica and Mercedes-Benz R-class. Both got off to slow starts because they were loaded up with expensive options and consumers seemed confused about exactly where they slotted into the automotive hierarchy. Plus they seem to miss the more upright stance of the crossover SUV. With manufacturers flooding the market with crossovers, where do the next product breakthroughs lie? One answer may be the Mazda CX-7, another long, low-roofed vehicle that is nevertheless taller than a sports tourer, and lower and sportier than a crossover. It also has a turbocharged engine, a feature rarely seen in either vehicle. Add some zoom-zoom to a Subaru Outback, and you get an idea. For a mature industry with an expensive price tag, autos are turning out to be as fashion-dependent as the cellphone business. Related vehicles: Related stories:  |
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