Midsize Sedan Deathwatch #1: One Only Needs to Examine the Minivan Segment for Guidance

Timothy Cain
by Timothy Cain

A decade ago, Americans could buy minivans from Buick, Chevrolet, Chrysler, Dodge, Ford, Honda, Hyundai, Kia, Mazda, Mercury, Nissan, Pontiac, Saturn, and Toyota. In all, 14 brands fought for the attention of 1 million minivan buyers.

Zoom ahead to 2016 and the minivan market — unlike the Terraza and Uplander and Freestar and Entourage and Monterey and Montana and Relay — is not dead. Indeed, through the first six months of 2016 minivan volume is up 25 percent and this year is expected to be the best year of minivan sales since 2008. Chrysler, Dodge, Honda, Kia, Nissan, and Toyota — only six candidates spread across seven nameplates and five automakers — are each generating sufficiently healthy volume in a market that is roughly 40 percent smaller than it was a decade ago. Rather than more than a dozen nameplates each producing an average of 70,000 annual sales, the remaining players will attract an approximate average of 100,000 annual sales each.

TTAC believes it is the midsize sedan segment’s turn to revolutionize in the same manner. In fact, the revolution is already underway.

You’ve already heard that small crossovers are eating into the midsize car segment’s share of the market. Even as the overall auto market rebounded out of the recession, U.S. sales of intermediate sedans grew just 2 percent in 2013 as auto industry sales jumped 8 percent. One year later, midsize car volume grew just 1 percent as the industry jumped 6 percent. In 2015, a record year for the U.S. auto industry, midsize car volume slid 2 percent. Through the first-half of 2016, midsize car sales are down 7 percent; June was the fourth consecutive month of decline and the eighth month of decline in the last year.

Midsize cars remain decidedly common new vehicle purchases. Over 1 million of these sedans were purchased or leased in the first-half of 2016. But as the decline of the category picks up speed, the number of candidates dropping out of contention increases, as well.

Long gone are the Saturn Aura, Pontiac G6, and Mercury Milan.

More recent departures include the Suzuki Kizashi and Mitsubishi Galant. Fiat Chrysler Automobiles euthanized the Dodge Avenger before introducing the new Chrysler 200.

We now know that production of the Chrysler 200, a former platform-mate of the aforementioned Avenger, will cease by year’s end. The 200 claimed 7.5 percent of the midsize category just last year. ( Allegedly.)

If the decline of the minivan sector — itself related to the rise of the three-row utility vehicle — is anything to go by, then the decline of the midsize car sector, tied to the rise of the two-row family crossover, will soon pick up speed and cause others to flee.

Numerous automakers are poised for departure, in part because the six top-selling midsize cars have increased their share of the midsize car market from 75 percent in the first-half of 2015 to 82 percent this year, leaving scraps for lower-tier nameplates.

The Mazda6? Sales of the Mazda we love to drive but wouldn’t want to live with are down 27 percent in 2016’s first six months. Mazda is on track to sell fewer than 40,000 Mazda6s in 2016, down from 71,447 at its peak in 2005. Mazda already killed off a subcompact car, the Mazda2, in favour of the tiny Mazda CX-3 crossover. Might Mazda be willing to do the same with the Mazda6?

The Buick Regal? Treading water between entry-level premium players and core midsize sedans, sales of the Regal are half as strong now as they were when the nameplate launched, pre-Verano, in 2011. Moreover, Buick has already shown a willingness to kill more popular passenger cars in favour of a market that’s turning toward utility vehicles.

Volkswagen Passat? Much as our own Jack Baruth thinks a hot Passat would do Volkswagen a favor, the current model has lost 40 percent of its U.S. volume since 2012. Further harmed by the damage Volkswagen has inflicted upon its own reputation by a diesel emissions scandal that restricted Passat sales by roughly a fifth, more Passat isn’t nearly as essential to Volkswagen’s future U.S. fortunes as the Chattanooga CrossBlue.

Subaru Legacy? While it stands out by being the only all-wheel-drive car in the segment, the Legacy sells just once for every 2.5 Outbacks. Yes, Americans prefer the wagon. By far.

If the market progresses on its current trend line, the Kia Optima could be on the bubble before long. Sales of the Kia Optima are on track to fall, sharply, to a five-year low in 2016 after rising to an all-time high in 2015. The Optima is by no means a low-volume player — it’s Kia’s top-selling model in the U.S. now. But Kia’s midsize market share is down to 5.5 percent from 6.7 percent a year ago, while sales of its platform-sharing corporate partner, the Hyundai Sonata, are up 9 percent this year.

The midsize car category is not dead, nor will it soon be. With the overwhelming majority, more than eight in ten, of the segment’s buyers choosing Camry, Altima, Accord, Fusion, Malibu, and Sonata, we can’t expect smaller automakers to continue to invest in a fight over a shrinking pie. They won’t all escape at once, and it won’t be immediate, but don’t think for a second the Chrysler 200 is the last to leave the arena.

[Images: Mazda USA, © 2016 Timothy Cain/The Truth About Cars, © 2016 Mark Stevenson/The Truth About Cars]

Timothy Cain is the founder of GoodCarBadCar.net, which obsesses over the free and frequent publication of U.S. and Canadian auto sales figures. Follow on Twitter @goodcarbadcar and on Facebook.

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  • Baggins Baggins on Aug 02, 2016

    a very common arrangement for family is to have a CUV/SUV/Minvan for mom/kid hauling duty and a mid sized sedan for dad/commuting. We've had that in our family for many years, and I see it commonly in my neighborhood. A modern accord or camry is quite comfortable and efficient at knocking out a 20-30 mile each way commute with a single driver onboard. I wouldnt want to have 2 sedans, as the minivan is far better kid hauler and road trip machine. But for me to get back and forth to work, a sedan is great.

    • See 2 previous
    • Paragon Paragon on Aug 03, 2016

      I had the use of a 2014 Accord LX a while back. I'm here to tell you that it is really possible to consistently get 38, 39, 40 or even 41 mpg commuting on the highway if you're not constantly mashing the gas pedal like a wannabe NASCAR driver. Of course, your mileage may vary. The Earth Dreams 185-hp 2.4L is connected to quite possibly the best CVT on the market.

  • Thecastle Thecastle on Aug 02, 2016

    Yes, the problem with SUVs is their an innefficent vehicle. Anyone who is cost conscious won't buy one, a sedan is generally more efficient, offers the same seating space as an equivalent SUV, maybe with a bit less headroom, and gets seriously better fuel economy. I have had both a BMW 535i as a loaner and a BMW X5 sdrive35. They're the same size, expect the x5 is taller, I had them both parked in the garage. Same length and width, the difference is the height, inside seating space is Equivalent. While the x5 struggles to get 18mp with lots of highway miles the 535i turned in 23mpg around town. So basically for a high ride height, worse handling, and no more leg room, that's a lot of fuel economy, oh and it's slower too.

    • Drzhivago138 Drzhivago138 on Aug 03, 2016

      The average consumer doesn't care about handling, top speed, or "driving dynamics," and they'll take the MPG penalty if it means having a decent amount of headroom and a more upright seating position.

  • MaintenanceCosts Last year, I rented a closely related Audi A3. The overwhelming impression was of cheap build quality, although the drive wasn't bad. It had ~45,000 miles and the sunroof sunshade and passenger side power window were already not working correctly. Lots of rattles, too.
  • Lou_BC As others have pointed out, some "in car" apps aren't good or you pay for upgrades. My truck did not come with navigation. It was an expensive option. There's a lame GM maps app that you need to subscribe to "in-car" data. The map does not give you navigation other than to tell you where restaurants and gas stations are located. I'd want Android auto since I already pay for the phone.
  • Theflyersfan Given so many standard nav systems aren't the best and updating could mean a dealer trip, and I stream all music, Android Auto is an absolute must. Wireless isn't necessary and some wireless chargers overheat the phone. And there are some hacks that let YouTube stream on the screen - excellent for listening to concerts.
  • Jeff I going to guess by the condition of the body and interior that there is little to no rust on the frame. Appears to be a very well maintained car.
  • MaintenanceCosts Would not buy a new daily car without it.