Midsize Sedan Deathwatch #9: Detroit's Participants Tumble At Double Speed In February 2017
Aside from the Volkswagen Passat’s 40-percent year-over-year uptick, every automaker competing in America’s midsize sedan segment suffered from declining volume in February 2017.
The midsize car category tumbled 19 percent, a loss of more than 34,000 sales.
February 2017 marked the twelfth consecutive month of year-over-year declines for midsize car sales in America.
This is the ninth edition of TTAC’s Midsize Sedan Deathwatch. The midsize sedan as we know it — “midsizedus sedanicus” in the original latin — isn’t going anywhere any time soon, but the ongoing sales contraction will result in a reduction of mainstream intermediate sedans in the U.S. market.
How do we know? It already has.
The Passat’s exceptional year-over-year uptick by no means represents healthy volume for the big Volkswagen. But the bigger story from February’s results was the horrific nosedive performed by Detroit nameplates: one discontinued nameplate, one of the older members of the midsize fleet, the newest member of the midsize fleet, and one semi-premium niche player.
Combined, the Chrysler 200, Chevrolet Malibu and Ford Fusion lost 22,592 sales in February 2017, a frightening 41-percent decline compared with February 2016.
Naturally, the Chrysler 200 deserves its fair share of the blame. Although formally cancelled at this time last year, production continued into late 2016 in order for a brief 2017 model year. But clearing out remaining 200s has been a tremendously difficult task. Heading into February, Fiat Chrysler Automobiles had more than 17,000 200s in stock. But only 2,194 200s were sold in the U.S. in February 2017. Discounts can’t change the fact that demand never truly existed for Chrysler’s midsize car.
Naturally, the 200 skews the overall picture. But removing the Chrysler from the equation does not alter the overall midsize segment’s rapid decrease in demand. Nor does it change the fact that the 200’s Detroit rivals likewise reported awful February sales figures while continuing their own downward trends.
February was the eighth consecutive month of decline for the aging Ford Fusion, which has by no means been boosted by the arrival of the Fusion V6 Sport halo model. February also marked the fifth consecutive month in which Fusion sales fell below 20,000 units.
Prior to the current streak, Fusion sales crested the 20K mark in 40 out of 45 months.
Year-over-year, Fusion sales in February slid 35 percent, a loss of nearly 9,000 sales. After averaging 24,000 February Fusion sales over the previous five years, only 16,512 were sold in February 2017, as total Ford division car volume slid 26 percent.
The Fusion isn’t the freshest face on the runway, however. That title belongs, for the moment, to the Chevrolet Malibu. Last year, U.S. Malibu volume grew quickly even as the segment declined thanks to the launch of a well-received ninth-generation model.
It appears increasingly clear that General Motors will not be able to maintain that level of demand. Year-over-year, the first one-sixth of 2017 revealed a 43-percent drop in Malibu sales. In February, Malibu volume fell 42 percent, a 9,012-unit decrease. Malibu inventory has now soared beyond six months supply.
Remember, these are the results for the segment’s recently redesigned model.
Together, the Malibu, the soon-to-be-replaced Buick Regal that we covered earlier today, the discontinued Chrysler 200, and the Ford Fusion that’s now in its fifth model year, traditional Detroit nameplates owned only 22 percent of the midsize sedan market in the United States in February 2017, down from 30 percent in each of the two previous Februarys and 34 percent February 2014.
Three years ago, more than one in three midsize cars sold in America was a Buick, Chevrolet, Chrysler, Dodge, or Ford. Now, barely more than one in five come from those same brands.
Yet while traditional Detroit marques suffered most last month, almost all of the made-in-America “imports” reported fewer sales than in February 2016, as well. The Honda Accord fell 9 percent. Hyundai Sonata volume was down 16 percent for an 11th consecutive month of decline. The Subaru Legacy and Toyota Camry both reported double-digit percentage losses.
As for the Volkswagen Passat’s distinct improvement, remember the period from which the Passat is improving. One year ago, the Passat was in the midst of a diesel scandal, and sales had fallen by nearly half from the current Passat’s February peak in 2012. Last month’s Passat sales did increase, year-over-year — Passat sales have grown in four consecutive months — but it was still the second-worst February of the current Passat’s tenure.
Gone are the glory days of 2012 and 2013 when Volkswagen could sell nearly 10,000 Passats in America each month. Over the last four months, Volkswagen of America has averaged fewer than 6,500 Passat sales per month.
Is the Passat the future of Volkswagen in America? Will Volkswagen again decide that building a distinct Passat in North America for North America is worth it in a market gone mad for SUVs?
It’s certainly not a Passat-exclusive line of questioning. Barely one in ten new vehicles sold in the U.S. in February were midsize cars. If sales continue to fall by one-fifth, month after month after month, automakers will lose 425,000 midsize car sales in 2017 after losing more than 250,000 in 2016.
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