After making clear their intention in the latter portion of 2015, SUVs and crossovers are now routinely outselling traditional passenger cars in Canada.
Through the first two months of 2016, utility vehicle volume sales volume was 23 percent stronger than passenger car sales. This stunning turn of events – passenger cars accounted for more than half the Canadian auto industry’s volume as recently as 2009 – occurs as automakers broaden the definition of “SUV” and “crossover” to more readily market products which meet at the intersection of consumer taste and government regulation.
This isn’t the mid-2000s, let alone the mid-1990s, when body-on-frame, truck-based SUVs roamed dealer forecourts only long enough to be scooped up by suburban families, yuppie couples, and sometimes even off-road adventure enthusiasts. In 2016, Mazda Canada calls its CX-3 a five-seat compact SUV. (You’re more likely to hear it referred to as a subcompact crossover.) The CX-3 effectively replaces the Mazda 2 subcompact hatchback in Mazda’s fleet. But with only 155 millimetres of ground clearance, the CX-3 scarcely offers any more space beneath its chassis than the 2 on which it’s based while hardly offering the ride height of traditional SUVs, let alone any of their off-road credibility.
Yet the CX-3 is adding more than 800 monthly sales to Canada’s SUV/crossover ledger. Between 2011 and 2014, the Mazda 2 added approximately 430 monthly sales to Canada’s passenger car tally.
Clearly the borders of the sector have stretched, but that’s not the only reason that SUVs and crossovers are selling so much more often than cars in Canada. Long established nameplates are hotter than ever. The Toyota RAV4, Honda CR-V, and Nissan Rogue all broke their respective sales records in calendar year 2015. (The best-selling Ford Escape fell back slightly from its record-setting 2014 performance.) All were on sale when cars formed the more popular group. All have taken over as obvious family vehicles.
Canadian RAV4 sales more than doubled between 2008 and 2015. Canadian CR-V sales more than doubled between 2009 and 2015. Canadian sales of the Rogue more than doubled between 2013 and 2015.
During similar stretches of times, their midsize sedan equivalents saw their share of the market shrink. Toyota Camry sales in 2015 were down 37 percent compared with 2007. The Honda Accord lost 37 percent of its Canadian volume between 2008 and 2015. An unending streak of Nissan Altima sales declines began in 2008 and have not ceased.
Though Canadian auto industry sales rocketed to a record-setting pace in 2013 and broke that record in 2014 – and broke 2014’s record in 2015 – the overall passenger car sector simply wasn’t a factor in the growth. Admittedly, pickup truck volume jumped nine percent in 2013, another five percent in 2014, and five percent more in 2015. But pickup trucks, mighty though they are, aren’t nearly the force for volume that SUVs and crossovers are.
Utility vehicle sales are growing far faster than the market as a whole, surging 13 percent in 2015 as the industry grew three percent and 22 percent during the first one-sixth of 2016, as total auto sales rose nine percent.
All-new, never-before-seen nameplates which weren’t on sale a year ago are responsible for a chunk of the expansion. Over the course of the two lowest-volume months on the auto sales calendar, four percent of all SUV/crossover volume was generated by the Land Rover Discovery Sport, Fiat 500X, Jeep Renegade, Mazda CX-3, and Honda HR-V, which weren’t available at this stage of 2015.
Yet so too have top sellers produced major gains. The Toyota RAV4, Honda CR-V, Jeep Cherokee, and Nissan Rogue – four of the five top-selling utility vehicles in Canada – collectively grew their January/February sales by 23 percent, growing faster than the sector in which they compete despite the fact that all are a few years removed from all-new status.
Automakers place great emphasis on trends, and perhaps even greater emphasis on a trend that sees car buyers becoming buyers of more practical vehicles. “There are certain segments of the SUV and CUV market where we are not competing today, and Ford is a full-line manufacturer and we believe we should be competing in all the relevant segments,” said Ford’s vice-president of sales, Mark LaNeve, when revealing Ford’s plan to introduce four new SUVs by 2020.
“In presenting the Audi Q2 at the 2016 Geneva International Motor Show,” says a recent Audi release, “Audi is introducing an SUV that rounds out the Q family downward in size.” Although North America likely won’t see the Q2, it’s safe to assume Audi isn’t done “rounding out” its Q family. Less than a decade ago, there was only one Audi Q model. The Q2 makes four.
In 2016’s first two months, only five percent of the new vehicles sold by Canada’s top-selling manufacturer were cars, as Fiat Chrysler Automobiles turns its attention away from low-volume sedans to focus instead on the expansion of its Jeep lineup.
This, therefore, is not a passing fad. Consumers are discovering that crossovers may imitate traditional SUVs in terms of style and ride height, but they more closely resemble cars in terms of ride, handling, and fuel efficiency. And to the majority of car consumers, the typical utility vehicle’s slight degradation in outright dynamic competence is a sacrifice worth making, if it’s even a sacrifice that’s noticed at all.
As a result, Canadians registered 89,000 SUVs and crossovers in January and February, equal to 39 percent market share. Car sales barely topped the 72,000-unit mark, claiming less than 32 percent of all new vehicle sales in Canada in early 2016.