New Chrysler minivan to debut at Detroit auto show
When Amy Fresch was ready to replace her 2012 Chrysler Town & Country minivan last year, the mother of three made a decision to switch to a sport utility vehicle.
“Four-wheel drive was my main reason for even shopping for a different car, but I also like the style, the look and the feel of not being in the ‘mom-car,’ ” said the 37-year-old Royal Oak resident. She said the minivan was great when her children — now ages 6-9 — were younger. “The minivan is such a fantastic car when you have small, small children ... but we’re beyond that now.”
Fresch is arguably one of millions of customers that Fiat Chrysler Automobiles NV will try to win back with its next-generation Chrysler minivan, which makes its global debut Monday at the 2016 North American International Auto Show in Detroit.
The yet-to-be-named vehicle, analysts say, must take what customers like Fresch love about their minivan — interior space, functionality and entertainment/technology options — to the next level to retain its customers and even attract new ones.
“Coming with a fresh design is great, but they have to make sure the vehicle continues to surprise and delight the family buyer,” said Stephanie Brinley, IHS Automotive senior analyst. “It just has to be really easy to work in their lives. That’s what’s going to attract them.”
The all-new Chrysler minivan, including a plug-in hybrid electric model, will enter a segment that has changed quite a bit from when the company invented the segment more than 30 years ago.
Minivan sales have gone from a record of nearly 1.4 million in 2000 to more than 500,000 in 2015 due to an uncool “soccer mom” stigma and America’s increasing love affair with crossover utility vehicles.
“Crossovers have really taken a bite out of minivan sales, and they continue to do so,” said Edmunds.com senior analyst Jeremy Acevedo. “It’s a tough time for the segment, but it is a right tool for the job. As far as people-moving goes, it gets no better than a minivan.”
During the minivan’s decline, crossover sales have boomed from less than 10 percent of the U.S. market to represent 23.5 percent of the nearly 17.5 million vehicles sold in 2015, according to Edmunds.com
Fiat Chrysler is the sole Detroit automaker left in the minivan segment, which Ford Motor Co. and General Motors Co. abandoned a decade ago. Its largest competitors are the Toyota Sienna and Honda Odyssey; combined they’ve made up more than 40 percent of the minivan segment since 2008.
“The segment’s certainly been challenged over the last five-plus years by crossovers, but it has a core fan base that is pretty dedicated,” said Kelley Blue Book senior analyst Karl Brauer. “And Chrysler gets to claim ownership of that segment both in terms of volume and creation.”
Between the Chrysler Town & Country and Dodge Grand Caravan, the automaker has represented at least 40 percent of minivan sales since 2009, according to Edmunds.com. That’s excluding 2015, when its plant that produces the vehicles in Ontario was shut down for months for a massive retooling for the next-generation minivan.
For Fiat Chrysler to remain a leader in the segment, industry analysts argue the next-generation minivan will have to have class-leading technology, better fuel economy and add features like its “Stow ’N Go” seating system, which helped revolutionize the segment’s interior.
The current-generation Dodge Grand Caravan could continue to be sold alongside the new Chrysler minivan. It’s unclear how long the automaker will continue to produce it. As part of Fiat Chrysler’s five-year plan in 2014, the Grand Caravan was scheduled to get the ax in 2016. But sales of the vehicle have remained extremely strong, and actually outsold the Chrysler Town & Country in 2015.
The company can produce both minivans at the Ontario plant.
“Whenever the Grand Caravan goes away, there’s likely to be some loss of sales,” Brinley said. “I don’t imagine that they can convert all of the Caravan buyers to Chrysler buyers ... But the question — bigger than if the sales will drop — is whether or not they can be profitable in that way.”
Although the minivan segment has declined from its heyday in the 1990s and early 2000s, it remains a profitable, extremely important area for the automakers involved.
Minivan sales are expected to increase in 2017 to roughly 500,000, as production of the new Chrysler minivan ramps up and Honda Motor Co. is expected to debut a new or significantly redesigned Odyssey minivan later this year.
“We see it staying above 400,000 units into the next decade,” Brinley said. “There’s a little bit of growth and then a little bit of contraction, but there relatively seems to be a base that will hold.”
Part of that “base” of customers will be millennials, a generation that has delayed family life but could have a profound impact on the minivan segment.
“It’s hard to bet against millennials and how much of them are out there, and they’re going to start families,” Acevedo said. “From all perspectives, they seem like a pretty pragmatic bunch ... A minivan seems to make a lot of sense.”
Chrysler’s minivan history
1983: First Chrysler Corp. minivans — Plymouth Voyager, Dodge Caravan and Dodge Caravan C/V — introduced
1987: Automaker sells 1 million minivans
1989: 1990 model-year Chrysler Town & Country establishes luxury minivan segment
1991: Second-generation minivans debut
1995: Chrysler Corp. sells 5 million
1996: Company introduces first-ever, cab-forward third-generation minivans with more than a dozen minivan-firsts
2003: 10 million minivans sold
2004: Fourth-generation minivan introduced with Stow ’n Go seating and storage system
2007: Company introduces 2008 model-year fifth-generation long-wheelbase model
Monday: Sixth-generation minivan — including plug-in electric version — to be unveiled at Detroit auto show