By on August 17, 2020

2020 Nissan Versa sedan - Image: Nissan

No Yaris. No Fiesta. No Sonic. No Mazda2. No Fit.

America’s subcompact car segment is decimated. According to Tyson Jominy, the vice president of data and analytics at J.D. Power, 40 percent of last year’s subcompact sales are gone. Jominy doesn’t mean “fewer sales.” He means that the nameplates responsible for 40 percent of the sales are gone.

And is it any wonder? As recently as 2014, subcompact cars produced 3.8 percent of all U.S. auto sales. Collectively, the few remaining subcompact cars now account for just 1.4 percent of the American light vehicle market.

At the current rate of decline, fewer than 1 percent of the vehicles sold in America in 2022 will be subcompact cars. But we all know the current rate of decline is hardly an accurate harbinger. If subcompacts own 1 percent of the market in 2021, we’d be surprised. 

USA subcompact car and crossover market share recession to pandemic - Image: © TTACSubcompact crossovers are hardly the only factors at play in the decline of subcompact cars. True, there’s an industry-wide shift from passenger cars to SUVs and crossovers, whether it’s Camry-to-RAV4, 3 Series-to-X3, or Impreza-to-Crosstrek. But beyond prevailing winds, subcompact cars also painted themselves into a corner.

Take fuel economy as an example. The most efficient Honda Fit and the most efficient Honda Civic will both cost $75 to run, the EPA says. What about actual payments? According to Toyota.com, leasing the least costly automatic-shift 2020 Corolla Hatchback will cost a grand total of $73 more less per month than the least costly 2020 Yaris Hatchback.

In other words, subcompact cars are typically less refined than compact cars. They’re usually slower. They’re rarely as nicely equipped. To counteract their demerits, subcompact cars offer the unique privilege of draining bank accounts at a more rapid rate.

Oh, the joy of tight turning circles.

2021 Hyundai Kona - Image: HyundaiRegardless of their own inadequacies, subcompact cars were selling at reasonable levels. Between 2012 and 2016, there were nearly 600,000 annual subcompact car sales in America, on average. 2015, however, represented a major swing in the market. It was the first time subcompact crossovers sold in greater numbers than subcompact cars. And there was no going back. Subcompact crossover market share (not including the Rogue Sport that Nissan folds into total Rogue volume) will soon be twice as strong as it was in 2015; subcompact cars will soon generate less than one-third the share they produced in 2015.

The shock-to-the-system of a pandemic-altered first-half did the dwindling subcompact car market no favors in early 2020. The ensuing incentives, such as interest rate drops that obviously lend far more favor to more costly products, have done virtually nothing to spur sales of America’s smallest cars. As auto sales fell 24 percent overall in 2020’s first six months, subcompact cars were down 51 percent, greater than twice the rate of decline.

Subcompact crossovers, meanwhile, lost only 7 percent of their volume while the overall market tumbled at more than three times the rate.

The die is cast.

[Images: Nissan, Hyundai]

Timothy Cain is a contributing analyst at The Truth About Cars and Driving.ca and the founder and former editor of GoodCarBadCar.net. Follow on Twitter @timcaincars and Instagram.

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22 Comments on “U.S. Subcompact Car Market Share Fell by Half Since 2016; Subcompact Crossover Segment Tripled Since 2013...”


  • avatar
    SCE to AUX

    Compounding the market disinterest is the fact that mfrs produce less margin on subcompacts than anything. Shrinking volume will make that even worse.

  • avatar
    Oberkanone

    Electric vehicles less than 2% of the market.

    Subcompact cars less than 2% of the market.

    • 0 avatar
      SCE to AUX

      Two market segments moving in opposite directions.

      • 0 avatar
        Oberkanone

        Very, very opposite.
        Honda E, Renault ZOE if sold in USA would combine subcompact + electric and I suspect these specific vehicles would sell decently if priced affordably.

        • 0 avatar
          stuki

          There’s just not that many zipcodes in the US where either one makes much sense. And in the few places where they may make sense, Uber makes even more.

          Even in most of Europe, people buy all the size/battery that can afford when they are buying EVs (or, perhaps more accurately: When taxpayers buy them a new car.)

  • avatar
    eggsalad

    The Venue replaced the Accent hatch. Near as I can tell, the only difference is height. If Hyundai wants to tell me it’s a CUV and not a subcompact, that’s their business.

    • 0 avatar
      Lorenzo

      As long as it’s not a sedan and has 5 doors, it’ll sell, if priced right. The most popular imports in the ’80s and ’90s were tall wagons, some with AWD. If it takes calling them CUVs, so be it. The margins can be improved with more luxury options and special editions, since nobody wants to drive an econobox.

  • avatar
    Lie2me

    I don’t think anyone here is surprised by these stats, we talk daily about the demise of the sedan and here it is. Before the sedan we watched the decline of station wagon and minivan. I guess next up is the eventual end of the ICE :(

  • avatar
    Conslaw

    I bemoan the decline of the sales of cars in general (vs SUV/CUVs), but subcompacts have had their advantages nibbled away by compacts and even intermediate/full-size cars. A tall subcompact might only get mid-30 mpg on the highway, roughly the same as a V6 Chevrolet Impala and less than a Honda Accord, Toyota Camry or Nissan Altima. Subcompacts are slower than compacts, marginally less safe, and don’t age as well or last as long. A 3 year old Yaris is likely going to be in no better shape than a 6 year old Camry.

  • avatar
    JMII

    So what cheap vehicles are left to buy these days? Back in the 90s when I was in college (and broke) you started making payments on a Civic hatch. It was cheap, sort-of fun and got good mileage. I guess these days that means a less-fun but otherwise similar HR-V?

  • avatar
    Steve203

    The lease comparison is a bit bogus. Lease pricing has more to do with what the company figures it can sell the car for when it comes off lease. I added up Fiat’s lease offer on a 500 a few years ago. Between the down payment and monthly payments for four years, the total was *more* than the sticker price of the car. In effect, Fiat was saying they expected the residual value of the car to be nil in four years.

    In general, the automakers, especially the big three, are all about elevating average transaction price and gross margin per vehicle. After they have killed off the last of the passenger cars, I expect the smaller CUVs to be culled as they push customers into progressively more expensive, more profitable, vehicles. 72 month financing has already become the norm. One wonders how much farther they will stretch out financing terms to make ever more expensive vehicles “affordable”. Of course, as the automakers abandon lower priced/lower profit market segments, they can continue to simply close factories and lay off tens of thousands as their volume shrinks as they pursue the higher priced, but also narrower, segments.

  • avatar

    My husband and I are among the few and proud buyers of subcompacts…..by choice.

    Currently we have a ’15 Chevy Sonic and ’16 Chevy Spark in our stable, and have owned a Honda Fit and Chevrolet Aveo.

    We much prefer them to anything larger. Why? Are we suckers for punishment?

    They do about 95% of what we need them to. Simple as that. Rarely do we ever need more space or practicality. They’re easier to park, we like fewer features, keeping the price of entry to a minimum, and for me, the availability of a manual. Maybe it’s because I’m not from the US originally, as the lowly hatchback serves as a family car elsewhere in the world, and there’s no reason it can’t here either.

    A CUV doesn’t appeal to us at all. We don’t need the image and don’t want to spend the extra few grand.

    I’m very sad that our choices are getting more and more limited

  • avatar

    On a side note (that will date me), this is reminiscent of the late 90’s and early 2000’s.

    After the demise of the Ford Aspire in ’97 and Suzuki Swift/Chevy Metro in 2000, there were no subcompact hatchback options. The sole choices were the Hyundai Accent, available only as a two-door, and the Kia Rio Cinco. The market had yet again been squeezed out; this time by large SUV’s and cheap fuel.

    As funny as it sounds, it was a relief when the Aveo arrived in 2004 and kickstarted the econobox trend that lasted until recently. I bought one of the first ones after holding out for any other alternatives for several years.

  • avatar
    Duaney

    If Biden is elected then sub compact sales will increase, as fuel economy standards and fuel prices increase.

    • 0 avatar
      ajla

      We’ll see but I doubt it. CAFE’s burden is not kind at all to small cars and subcompact CUVs are getting over 30MPG combined ratings now. Assuming fuel prices aren’t on their way to $8/gal (and I don’t think they are) a big credit crunch is the only thing that I think might slow down the CUV march and get people buying smaller vehicles.

    • 0 avatar
      indi500fan

      Killing offshore and fracking will definitely ramp up fuel prices quickly, and the psychology of the changes will make OPEC much bolder also. Throw in some big carbon taxes via Cap N Tax and we’ll have 5 buck gas in a heartbeat. Those 10 yr old 150,000 mile Prius’s will be quite valuable on the used market.

  • avatar
    MKizzy

    There is some long-term hope for the subcompact car segment if birthrates continue to decline as some experts predict, but not for gas powered vehicles. Even then, future electric subcompacts would only fly off the lots vs their larger brethren if…

    A)Future Gen Z adults with zero to 1 kids decide small low riding cars are the bees knees and is all they need or…

    B) Electricity rates skyrocket due to demand + the profit motive and it’s proven (or assumed)that smaller vehicles are much more efficient at consuming electrons.

  • avatar
    JLGOLDEN

    It seems that the 2013 Buick Encore was the pioneer in the “tiny SUV/CUV” class. It brought unforeseen customers into GM showrooms, and it had little competition for a while. Primitive as the Encore seems now, it’s still a strong seller, when the deal is sweetened with generous discounts. The tiny CUVs are loved because of the refreshing combination of hatch utility, a slightly elevated seating position, and a relatively nimble handling feel.

  • avatar
    ABC-2000

    Funny that Mazda, after many years, decided to bring the 2 to the US just to see it parked for a long time on dealer lots, even Toyota could not sale many of them in Yaris form.

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