Speedsters gain popularity amid nosediving car sales

Ian Thibodeau
The Detroit News

After years buying small cars, American consumers keep turning to big, beefy SUVs and trucks. But Ford Motor Co. and Fiat Chrysler Automobiles NV see a silver lining in those plummeting car sales.

The automakers say sales of souped-up hatchbacks and powerful muscle cars have increased recently, running counter to a car sales slump experts and industry officials say is well into its sixth year. Powerful trim packages add horsepower and can more than double sticker prices — boosting profits for the automakers.

They also offer automakers a chance to appeal to new, richer demographics. “Not all car sales are waning,” said Ford spokesman Chris Terry. “More importantly, the highest profile ones are doing really, really well.”

Through the first four months of 2017, U.S. passenger car sales have dropped 11.4 percent year-to-date, according to Autodata Corp. But Ford says combined sales of its sporty Focus ST and Focus RS models jumped 25 percent in that same time period. The automaker is also seeing a boost from the Fusion Sport, which went on sale in 2016.

“The idea is to shine a halo over the whole line” with the sportier models, said Michelle Krebs, an executive analyst for Autotrader. When it comes to the bottom line, sales volume of the pricier models is typically small, and can’t lift sales for an entire line of vehicles.

For example, Ford Focus sales have dropped 24.6 percent year-to-date, despite the popularity of its ST and RS variants. The Dearborn-based automaker in that same period saw its total car sales drop 22.1 percent.

Fiat Chrysler, meanwhile, saw sales of its “ultra high-performance” cars, like the Dodge Challenger SRT Hellcat and Charger SRT Hellcat, increase 4 percent in 2016. But the company has also seen car sales drop drastically through the first four months of the year.

And Dodge is currently sitting on a glut of unsold Challengers, according to data from Cox Automotive. Still, Dodge continues to roll out high-performance cars to carve a deeper groove in what’s becoming a coveted niche.

“With all of those options, we need to differentiate ourselves from the overwhelming number of choices, so customers immediately know what Dodge SRT stands for when they hear the name,” said Tim Kuniskis, head of Dodge, SRT, Chrysler and FIAT passenger cars with Fiat Chrysler North America. “Performance is in its own way a luxury and offers a way for buyers to quantify how the vehicle they buy is different or better.”

General Motors Co. has seen car sales, including Corvettes and Camaros, drop in the first four months of the year compared to last year, according to Autodata Corp. GM declined to provide sales information for some of its higher-performance trims.

Performance cars won’t save declining overall sales, but the vehicles do help automakers broaden the reach of a poorly-performing segment. Said Krebs: “Those buyers tend to be champions for the product. The word of mouth that they provide tends to be more influential.”

Buyers of the performance cars tend to be younger, wealthier and more likely to buy another Ford vehicle, according to data the company studied.

Performance vehicles are a hit with older millennials, and younger generation Xers. The average household incomes of Focus ST and Focus RS customers are $108,000 and $169,000, respectively, compared to the average income of a non-performance Focus buyer at $63,000.

The sporty cars attract buyers with more money to spend, and more time to spend it — buyers like Jeff Catlin, a gearhead and showroom manager of the Barrett-Jackson Collection showroom in Scottsdale, Ariz. The 48-year-old bought a Focus RS in February, and he says the 350-horsepower rally car is becoming his everyday vehicle.

Catlin, who owns six vehicles, called himself a “Ford guy.” But he never considered buying a small car from Ford before the company released the RS in the U.S.

“It’s amazing what that car can do,” he said. “I go to it more than I do anything else, because it’s so much easier to drive around on the freeway. It’s kind of the go-to car unless I need the truck.”

Twitter: @Ian_Thibodeau