The US Small Car Market - September 2012
The Upper Tier segment represents the biggest segment in unit sales, however greater growth is shown in the Lower Tier and Specialty Tier segments with their smaller frames and greater fuel efficiency.
Rising gas prices and improved vehicle quality are driving consumers to small cars. These vehicles are no longer valued for their practicality but are being marketed more for their lifestyle component. This market picked up in 2011, when unit sales increased 12%, an increase that is expected to continue by the end of 2012. After remaining stable in 2013, this market is expected to pick up 15% in 2014. Between 2014-17, the small market is expected to grow 55.8% in unit sales.
The majority of all respondents to Mintel’s online survey (55%) neither own or lease a small car nor do they plan to buy one in the next six months or more. However, over one quarter (27%) currently own or lease a small car. Those respondents who are planning to purchase either in the next six months (3%) or more than six months hence (3%) is minimal. For automakers aiming to introduce new small car models, the best potential base is the 12% of consumers who do not currently own or lease a small car but are interested in purchasing one.
What's included in the US Small Car Market Report:
For the purposes of this report, Mintel considers the small car market as being for new vehicles only (not used), and has used the following segment definitions:
- Lower Tier small cars typically run less than 170 inches in length and have a 2011 base MSRP between $12,500 and $16,000. Examples of cars of this type currently on the market include the Chevrolet Aveo, Kia Rio, and the Honda Fit.
- Upper Tier small cars typically run between 170 and 180 inches in length with a 2011 base MSRP between $14,500 and $16,000. The Nissan Sentra, Volkswagen Golf, and Ford Focus fall into this category.
- Specialty Tier small cars, a segment that includes two-seat vehicles, hybrids/electrics, and design-focused vehicles, is also measured here. Specialty compacts consist of vehicles in the $18,000-32,000 range. The BMW Mini Cooper, Volkswagen‘s Beetle, and the Nissan LEAF are prime examples of cars in this category.
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