The composition of the auto market has modified dramatically lately. Vehicles have grow to be rather more expensive — partly because they’re increasingly tech-heavy — but additionally because they’re getting larger.
In reality, once we discuss searching for a recent “automobile” in 2024, that always actually means searching for an SUV or a truck — technically not cars in any respect.
Most passenger vehicles are classified as either cars or light trucks, and SUVS and minivans fall into the latter category.
Latest data from car-shopping site Edmunds finds that traditional cars account for a mere 19% of the general recent vehicle market — a record low — while SUV market share is at an all-time high (58%). For context, traditional cars made up 47% of the brand new vehicle market a decade ago.
CNN reports that the main American auto manufacturers have “virtually abandoned the sedan market.” Ford’s only “traditional” automobile is the Mustang, as an illustration, while Chevrolet is all the way down to zero after discontinuing the Malibu in November.
The burgeoning SUV market, meanwhile, continues to grow more crowded. In accordance with Kelley Blue Book (KBB), Americans can choose from greater than six dozen SUV models available on the market.
Automakers like selling SUVs because they’re more profitable than traditional cars, in accordance with Pat Ryan, CEO of the car-shopping app CoPilot. When manufacturers struggled with supply-chain issues through the pandemic, they prioritized these moneymaking vehicles.
“Americans love big SUVs, and people have long been essentially the most profitable,” Ryan says. “So actually, constructing those whenever you had shortages during COVID-19 was a natural incentive for manufacturers.”
They’re also what Americans increasingly prefer, he says. Automobile shoppers today want more height, cargo space and legroom, and are willing to compromise on mileage, price and handling for the additional space.
Ryan attributes much of the rising popularity of SUVs to the fast-growing popularity of “crossover” models, that are small SUVs built on more compact automobile chassis. They’ve more room than a sedan but handle more like a automobile than a big SUV built on a truck frame. “Cars have really been replaced by the crossover,” he says. “That is really what’s happened.”
One other key consider the shift from traditional automobiles to SUVs: American manufacturers used to supply passenger cars partly to cut back the common fuel economy of their fleets and satisfy government requirements. Now, they’re doing that with hybrids and electric vehicles as an alternative, Ryan says.
As cars have fallen out of fashion, the recognition of pickup trucks has remained kind of flat, with market share hovering between 18% and 20% over the past five years. Consequently, the biggest vehicles — SUVs and trucks — now represent the overwhelming majority of the brand new vehicle market.
Briefly, greater is best within the mind of the American consumer. “Americans are greater people: They like greater homes they usually like greater cars. It is a component of the psychology of our country,” Ryan says.
Research suggests, though that we’ve got a bent to purchase larger trucks than we really want. For instance, over 60% of people that own Ford’s full-size F-150 pickup truck rarely or never use their trucks for towing and only 28% of householders incessantly use their vehicles for hauling bulky or heavy items.
The trend of super-sizing our cars is a giant reason why recent vehicles have grow to be so expensive. Full-size SUVs typically cost over $70,000. Pickup trucks cost a median of nearly $60,000.
Overall, the common price for a recent vehicle ($47,337) is up 71% since 2004, in accordance with Edmunds. But truck prices are up 106% in that point. Meanwhile, average passenger automobile prices have increased 54%, rising to $37,767.
In the event you’re just buying a vehicle to get to work and shop for groceries, you could be higher off with a smaller, cheaper vehicle than a full-size truck or SUV. Despite the decline within the variety of cars available on the market, there are still plenty on the market, particularly from non-American manufacturers. Honda and Toyota are the leading manufacturers of sedans and compact cars with models just like the Accord and Camry, respectively. Other foreign auto brands like Hyundai, Kia and Nissan also produce relatively reasonably priced options on this segment.
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