Who killed the full-sized SUV? There they were, lumbering along, transporting America's families in comfort and style, when BANG! Dead genre driving. The biggest of the big– mighty Yukon XL's, epic Sequoias, humongous Hummers– now sit on dealer lots in long, neat rows, covered in ten-foot pole marks. JD Power reports that sales of full-size SUV's have dropped 22% so far this year. Sales of Ford's Explorer are off by 25% in the same period. Formerly truckeriffic GM is teetering on the abyss. Who dunnit?
Suspect number one: gas prices. The media coverage connecting rising gas prices with shrinking SUV sales has been relentless. Story after story showcase a working-class Dad or multi-tasking Mom whose love affair with their SUV rolled over and died (so to speak) when its petrochemical needs became financially overwhelming. Or, as printer Bob Fisher of Medford put in a recent NY Newsday article, "my Durango is killing me in gas."
Financial analysts are not so sure. According to the Economic Policy Institute, even Americans with incomes in the bottom fifth nationwide currently spend just 7% of their after-tax income on gas. Historically, the recent rises are no great sheik. In 1981, hard on the heels of the Iranian revolution, world crude oil prices rose to $72.24 a barrel. The hike pushed US gas prices to $2.77 a gallon (adjusted for inflation). The real cost of gasoline today is still 98 cents a gallon lower than it was back then. And compared to the rest of the world, well, a gallon of gas still costs four to five times more in The Land of Hope and Glory than it does in The Land of the Free.
Suspect number two: a guilty conscience. Maybe American consumers HAVE "woken up" to the SUV's negative political/environmental impact. God knows there's plenty of anti-SUV propaganda swirling around the cultural ether– from eco-terrorist attacks on SUV dealers to Hollywood stars leaving the 'Sclade at home for a ride to the Oscars in a [graciously-loaned] Toyota hybrid. As anyone who owns a Hummer H2 will tell you, there's an army of PC crusaders out there happy to 'discourage' SUV ownership through public vilification.
Talk to Greenpeace or the Sierra Club and there's no doubt in their mind (or newsletters) that environmental campaigning is driving nails into the SUV's coffin. Ron DeFore of the SUV Owners of America is equally adamant that political concerns play a miniscule role in the full-size SUV's recent decline. "People were SUV-bashing eight years ago; sales never slowed for a second." Perhaps, but have constant attacks on the genre's alleged pollution, cataclysmic impact on smaller vehicles, waste of world resources, etc. finally pushed consumers to some kind of tipping point?
Naa. Americans are blessed with a strong sense of morality, a keen appreciation of political reality and a large dose common sense. Even without haranguing, they tend to use all three in concert. That said, the connection between US foreign policy and fuel consumption lingers– somewhere– in the SUV buyer's mind. How that actually plays out on the forecourt is hard to measure, and neither side would trust unfavorable survey findings anyway. So let's call social concerns an accomplice to the crime and move on to suspect number three: crossovers.
Crossovers offer most of the advantages of an SUV– towing capacity, raised driving position, seating for six or more, safety, four-wheel-drive– with less damage to the Shell card/environment/political landscape/world oil supplies. While the new genre is still experimenting with design and packaging, the vehicles are gaining consumer acceptance. Factor in the recent termination of the tax credit for the biggest SUV's, the increasing popularity of smaller, more frugal SUV's (a.k.a. "cute utes") and the introduction of larger cars and minivans with four-wheel-drive, and you've got an entire mob ready to steal sales from full-size SUV's. The stats confirm the trend; sales of crossovers, cute utes, minivans and large sedans are all benefiting from SUV downsizing.
Which could be caused by rising gas prices. Yes, this is one of those Agatha Christie-type deals where all the suspects are guilty: gas prices, political consciousness and the entry of attractive alternatives into the marketplace. It's also a twist ending thing, because the SUV isn't really dead. It's just resting.
Last year, Americans bought over 700k full-size SUV's. This year they'll buy less, but still a lot more than you could fit into your average Wal Mart parking lot. When automakers find a way to extract better mileage out of the full-size SUV, there'll be plenty of drivers ready to go back, have their cake and drive it too. Meanwhile, the smart money is on companies who know that the gas-chugging full-size SUV must adapt or die. For real.
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