Study: Small cars best-sellers among new car buyers
Sales of small cars may have suffered in recent months thanks to relatively low gas prices and Americans' love affair with crossovers and utilities, but a new study says there's still a market for them.
In a third-party survey, data company MaritzCX found that compact cars like the Focus, Chevrolet Cruze and Dodge Dart are still the best-sellers among first-time vehicle buyers.
Maritz found 27.3 percent of first-time car buyers choose compact cars, while only 13 percent choose small SUVs and nearly 8 percent choose mid-size SUVs. That percentage rises slightly — to 27.6 percent — for buyers who are purchasing their first new vehicle. When compact cars are combined with "B segment" subcompact cars like the Fiesta or Chevy Sonic, they represent about one-third of all first-time buyers' purchases, Maritz said.
"Compact cars like the Focus represent an ideal blend of fun-to-drive, value for the money, fuel economy and new features that is hard to beat for first-time buyers," Erich Merkle, Ford sales analyst, said in a statement. "For the industry, it's hard to understate the importance of the compact segment for the long-term health of the company."
The Maritz study comes at a time where automakers are moving small car production out of the United States where they can be built cheaper.
Ford last week said it would end Focus and C-MAX production at its Michigan Assembly Plant in 2018 and the UAW is saying it will leave the country. Sales of the Focus are down 3.2 percent so far this year; C-Max Hybrid sales are down 16.9 percent.
Toyota Motor Corp. said earlier this year it will build a $1 billion plant in Mexico to help build Corollas.
Automakers are bypassing the U.S. for new plants in part because Mexico has dozens of free trade agreements around the world, low wages, free or nearly free land on which to build and fewer regulatory hurdles.
Fiat Chrysler Automobiles CEO Sergio Marchionne said Tuesday by streamlining the investment process and sharing in the cost, "you can make cars in the U.S. and make money."
"The car segment itself is wide enough and big enough that if efficiently run you could actually produce these (in the U.S.)," he said during a bargaining kick-off event with the United Auto Workers in Detroit.
UAW President Dennis Williams, sitting next to Marchionne on Tuesday, agreed: "I believe that it's important to have a good mix within trucks, SUVs, crossovers and cars. I believe it can be produced here and make profit."
When asked, Marchionne told reporters after the event that the company "may have to" cut production of its compact Dodge Dart in Belvidere, Ind. if demand slows.
"We'll adapt to the market," he said. "I can't sell cars on the moon. If they're not sold, we'll cut it back."
Halfway through the year, Dart sales are up 29 percent to 49,055 compared to the first six months of 2014. Last year, the company sold more than 83,000 Darts – level with sales in 2013.
GM builds the subcompact Chevrolet Sonic at its Orion Assembly Plant in Orion Township – the only subcompact built in the U.S. CEO Mary Barra said Monday GM has no plans to change that.
Michael Wayland and Melissa Burden contributed.