It’s come to this. Ford and General Motors are deep-sixing passenger cars right and left, as they look high and low for new SUV markets to conquer. Do we have performance luxury crossover covered? Where’s our supercar SUV, capable of zero to 60 in under three seconds? Bye-bye Chevy Cruze and Volt. We hardly knew ye, Ford C-Max, Taurus, Fiesta and Fusion. Fiat Chrysler barely had any cars left to cancel.
As the Detroit Auto Show unfolds, automakers are being forced to give up on sedans. They don’t have much choice. In the first five months of 2018, for instance, SUVs outsold cars two to one, reports Automotive News. The mighty Ford now offers only the Mustang for Americans who don’t want an all-wheel-drive box. It’s gotten so bad that it makes headlines when Toyota says that, yes, it is going to continue to build cars.
In 2013, U.S. car sales and SUV sales were split 50-50, but we’re far from that now. From 2015 to 2018, passenger car sales plunged by 1.9 million. According to Edmunds, only 52 percent of car owners in 2018 went out and bought another car—they switched to SUVs instead. At the same time, SUV purchases went up by 2.3 million. The pickup truck, oddly enough, stayed steady during the period.
I was struck at the recently concluded Consumer Electronics Show (CES) that the Fiat Chrysler stand looked like a total anachronism, dominated by big, heavy trucks and SUVs that looked, well, so 20th century. This is the age of the self-driving car, after all.
And yet that product mix turned out to be savvy—with sales up 10 percent. The company gave up on the Dodge Dart and Chrysler 200, and only 10 percent of its product portfolio today is passenger cars. And it worked! Jeep sales were up 20 percent in 2018, to 87,502. Sales of the big Ram trucks soared 27 percent, to 54,808. Meanwhile, the car divisions—Chrysler, Dodge, Fiat—were all down. Fiat sales were just 1,374, down a huge 35 percent.
Subaru, with its 100 percent all-wheel-drive lineup, also had a great year in 2018.
When, and why, did America get so fixated on trucks and going “off road”? Was it a nefarious plot by Detroit to get consumers into hugely profitable vehicles? No, but the movement turned into a big cash cow—Ford used to make $18,000 on every one of its huge Excursions. And in the early days of the craze, Ford was making half its worldwide profits from just one big SUV factory.
Consumers actually started it. On their own. Here’s a couple of names. The 1984 Jeep Cherokee, which set the template by combining a truck-based ladder chassis with a car-style monocoque body. According to Driving.CA, the four-door Cherokee inspired another bestselling icon, the 1990 Ford Explorer.
The history is interesting. There were utility vehicles like the Chevy Suburban in the 1930s. But the lineage we're talking about started with a tiny company called American Bantam, which in 1940 built the first prototype of the Army’s small four-wheel-drive General Purpose (“GP,” which became “Jeep”) military vehicle. But Bantam was deemed too small for the job, so the contract went to Ford and Willys.
Willys morphed into Kaiser Jeep after the war, and began building civilian versions of its rugged, go-anywhere vehicle. There was a station wagon in 1946, a pickup truck in 1947, then the fairly civilized Wagoneer in 1963. It’s this car that Hemmings Motor News describes, with some justification, as “the progenitor of the popular sport utility vehicle.” Did Jeep build the Wagoneer for suburbanites to commute in? No! It was thought that a few well-to-do fishermen and hunters would buy them, or maybe construction foremen.
Around the same time (beginning in 1949), Land Rovers started to sell in Great Britain, and a few made it across the Big Ditch.
International Harvester made rare forays into the car business with the Travelall (1953) and the Scout (1971).
American Motors (there’s a blast from the past!) bought Kaiser Jeep in 1969, little realizing it had attached itself to a powerhouse. Jeep was the first company to use the phrase “sport-utility vehicle,” for the first-generation Cherokee in 1974. Ownership of Jeep was the main reason Chrysler bought the struggling AMC in 1987 (that, and a new car plant in Canada).
The Cherokee was a bright spot in the lineup. For years: The second-generation XJ Cherokee was built until 2001. At that point, SUVs were 4.5 percent of the global market. People—a few of them, then—liked not only the off-road capability, but the image of being someone who wanted to go off-road. Then as now, only 10 to 15 percent of SUV owners ever take their vehicles off the beaten path. And then there was the ride height, a huge hit with women buyers. I wish I had a nickel for every time I was told, “I like to sit up high.” But if everyone is up high, what are we looking down on?
I always thought it was funny that SUVs are thought to be safer. Cars and trucks are rated with a star rating from the federal government, and high four-star ratings are common across the spectrum, including with small cars like my Honda Fit. And SUVs have an elevated rollover risk.
Chrysler looked like the smartest kid on the block as the SUV craze slowly gained steam. But look what happened in 2008. The recession coincided with high gas prices ($4 a gallon and up), and suddenly you couldn’t give away SUVs. GM closed four truck and SUV plants back then. Nobody wanted the big Jeep Commander, and Hummers were going begging as used cars.
But gas prices are cyclical, and they went down again. Americans have shown time and time again that they will buy big vehicles if they can afford to put gas in them, and so, around 2010, the pendulum swung back once again with $2.50 a gallon. By 2013, SUVs were 11 percent of the world market. And it grew from there. A modest sales wave for SUVs became tidal.
And now look at the mess we’re in! Automakers are toast unless they have a full range of five- and seven-seat SUVs. I think we’re going to get caught flat-footed if gas prices go up again. Ford, Chrysler and GM are building small cars only internationally now. Japanese automakers are playing it smarter, introducing SUVs right and left but also retaining their small- and mid-sized cars.
It used to be only North America that had caught SUV fever, but now it’s worldwide. They’re all over the road in Europe, the Middle East, China and Japan, and seeing steep growth rates. Worldwide SUV sales leaped 22 percent in 2016, to 27 million units. Really high gas prices don’t stop the sales there, so I guess we’re stuck with SUVs. For now.
Here's the history of the Jeep, on video: