By Christopher A. Sawyer
The Virtual Driver

(January 20, 2018) Conventional wisdom says the car market is dying, and crossovers and SUVs will replace the traditional sedan sometime in the next decade. Last year, FCA announced that it would end production of both the Dodge Dart and Chrysler 200 and replace them with crossovers.

Meanwhile, this year’s show was preceded by strong hints from Ford’s new CEO, Jim Hackett, that his company would not replace the Fusion with a new version as scheduled in 2021. This came not long after Ford announced that it would drop the Fiesta from its 2018 lineup, and move Focus production to China.

The latter was significant in that Ford previously had stated it would not import cars from China to the U.S., or import European-built versions to the U.S.

That led many to the conclusion that Ford was exiting the car market. Especially when Hackett (who insiders caustically refer to as “Buddy” in a non-subtle slam against his perceived arrogance and proud non-car guy status) defended the change in direction by saying that, up until recently, the only thing that had kept people out of the crossover market was that cars got better gas mileage, which no longer is true.

Unfortunately for him (and Ford), the show floor featured a number of new sedans in markets Ford apparently is about to exit, which caused an informal “clarification” to be issued, stating that at no time had executives said Ford would not build sedans or not update the Fusion.

Good thing.

New studies show Millennials who don’t have a car plan to get one, Generation Z can’t wait to learn to drive, neither generation is convinced autonomous cars are the answer, and there is increasing interest by them in cars versus crossovers. Oh, and they don’t like the word “mobility”, one of the industry’s favorite buzzwords.

However, the shift toward trucks and crossovers and away from cars seemingly continues unabated, and was punctuated by Ford teasing a new performance crossover that would use the Mach 1 name. The concept, due at next year’s show, is expected to go into production in 2021 at the Flat Rock plant alongside the Mustang, which will add a hybrid model of its own in 2020.

The Mach 1 (the name drew righteous ire from Mustang fans, causing Ford to backtrack and say use of the name was not set in stone) could be built on a unique full-electric chassis, and reports from multiple and varied sources suggest it is the “four-door Mustang” currently being developed in Dearborn. Whatever the case, it seeks to profit from two trends: 1) the positive press (and bulging stock price) enjoyed by Tesla, and 2) the crossover craze, which shows no signs of abating.

Or does it? a quick conversation with a Toyota executive confirmed that car sales have declined by three percent per year, and that trucks now account for 64% of the market. And while the company has introduced more crossovers and crossover concepts in recent years, the executive stated the decline in car sales is slowing, and should begin to turn around in approximately 3-5 years.

Even at current levels, the mid-size market has yearly sales of two million units, and Toyota — which has aggressively redesigned the Camry and Avalon and will soon follow with a new Corolla — wants a big pice of that profitable pie. As do Honda, Hyundai, Kia and VW.

The Virtual Driver