Having overrun sedans to become the most popular car type in 2014, SUV sales are still growing, despite the critics.
“A lot of people have been writing its obituary for decades now,” Jack R. Nerad of Kelley Blue Book said.
But the SUV is here to stay, it seems.
Though consumers do tend to buy larger cars when gasoline is cheap, the average fuel economy of modern crossovers or SUVs is improving — but they are still lagging behind smaller vehicles.
This puts carmakers in a tough spot.
“Regulations on fuel consumption are pushing them in one direction and popular demand is pushing them in another,” Nerad said. “The car maker is in a difficult position to meet.”
The Obama administration set in 2012 a fuel economy standard of 54.5 miles per gallon for cars and light-duty trucks to be achieved by 2025, putting consumer demand at ends with regulations that manufacturers must meet.
Already, some carmakers — especially the ones most dependent on SUVs, crossovers, and pickup trucks — are feeling the pressure.
Fiat-Chrysler, which is consistently ranks among the worst in terms of fuel economy, is increasingly dependent on SUV and truck sales, recently cutting the Dodge Dart and Chrysler 200, two non-SUV models with lagging sales — making it even more difficult for the company to keep pace with regulations.
But market demands are what they are, and car companies claim that they are just responding to consumers who are increasingly uninterested in smaller, more-efficient cars.
According to Nerad, that’s because consumers who go from a sedan to a crossover tend not to return to a smaller car unless there is an economic reason to do so.
“Once you’re in a taller vehicle it becomes hard to switch back,” Nerad said.
This is especially true among young buyers who like the perceived practicality of crossovers and are uninterested in sedans or subcompacts.
Adding to the pressure on carmakers, American consumers are not the only ones who crave larger vehicles.
“Buyers in China have very similar habits to Americans,” Nerad said, referring to the fastest-growing car market in the world.
It is also unclear if the fuel economy standards will continue unchanged. A strong lobbying effort by carmakers is likely as they continue to feel the pinch.
And, Nerad said, the outcome of the next presidential election could drastically alter the fate of regulations as well.
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