Crossovers and Auto Trends - 2004

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Crossovers make it hard to keep up with auto trends
Greg Cancelada
St. Louis Post-Dispatch

ST. LOUIS - The Mulcrone family piled into the shiny black Chevrolet Malibu Maxx on display at the St. Louis Auto Show. John and Rozanne tested the seats for comfort; Brian, 12, climbed through the lift-back and squeezed into the rear cargo space.

"I grew up in Detroit, and I've always been a car fan," said John Mulcrone, 54, personnel manager for Owens-Illinois in Vandalia, Mo.

Besides, the family wants to keep up with trends, Rozanne Mulcrone said.

But keeping up with the auto industry isn't easy this year. J.D. Power-LMC Automotive Forecasting Services expects 25 new vehicles and 27 redesigns of existing models in the domestic market in 2004, a number that's expected to rise in 2005.

A new twist: The Big Three - General Motors Corp., Ford Motor Co., Chrysler Group of DaimlerChrysler AG - are spotlighting their passenger-car lineups.

"The majority of their production and concept vehicles were cars" this year, said Jeff Brodoski, an analyst in Troy, Mich., who tracks the industry at consulting firm J.D. Power and Associates.

At the same time, Japanese competitors are flexing their muscles in the light-truck market - including minivans, sport utility vehicles and pickups - where the Big Three traditionally have dominated. Even Honda, which had said it wouldn't build a pickup, unveiled in Detroit in January the SUT, a short-bed pickup that isn't yet in production.

Still, analysts don't see the Big Three's focus on cars as part of a bigger trend or shift. Intensely competitive, the passenger-car market continues to be overshadowed by light trucks.

Though 7.7 million passenger cars were sold last year in the United States, it was the worst year since 1963, Brodoski said.

This year's focus reflects the fact that the Big Three neglected the car market in previous years and finally must update their products, said Rex Parker, vice president at industry consultant AutoPacific in Tustin, Calif.

"If you let the old product go long enough, you do have to do something about it," Parker said. "The fact is, a balanced portfolio is a good thing to have, regardless of whether it is financial or automotive."

For example, Chrysler is looking at the 300C and the Dodge Magnum to replace its long-running LH-series cars, and the Ford Five Hundred sedan and Freestyle SUV will replace the Taurus line, he said.

Though a lot of fresh products are entering the market, 2004 isn't expected to be a boom year for the auto industry, despite the strengthening economy.

The bigger story this year seems to be the continued growth of the crossover vehicles, which combine characteristics of a passenger car and an SUV or minivan. For example, a crossover based on an SUV design might use a car underbody, known as a platform, instead of a truck platform, on which SUVs have been built traditionally. This trims the power and off-road capability, but it smoothes out the ride and improves maneuvering.

One key reason for the stronger crossover demand is demographics, Pipas said.

Baby boomers - mainly people born between 1946 and 1964 - like the comfortable ride, he said.

Because many of their children are grown and have left home, baby boomers no longer need big vehicles, and their increased disposable income is helping to stoke demand for these crossover vehicles, he said.

At the same time, Generation Y, roughly people ages 11 to 26, looms on the car-buying horizon, he said. The oldest are starting careers and buying new cars, Pipas said. "Because they're not in household formation, they tend to buy smaller sport utility vehicles, and many of these smaller SUVs are crossovers."

Full Article Here

[Mikkoo]

The crossover market probably will become a much
bigger part of the overall sales in North America.
We are just starting to see the beginning of a tidal
wave of new models in this segment.

[New_Mexico_Sunset_on_Rt66]

The Nomad appears to be an attempt to get into the cross-over vehicle market. Does GM have a "performance" cross-over in the makings? Similar to a Magnum, Infiniti FX45, or Porsche Cayanne?

Hmm, when I was growing up, "cross-over vehicles" and SUV's were called station wagons. But I know, nobody would buy a "station wagon", but they would buy a cross-over or an SUV.

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