The sales reports for cars and light trucks in the US market in October are coming in and the message is clear: Trucks and SUVs are hot. Everything else is not. The news on electric vehicles is mixed. We’ll get to that in a moment.
Recently, we did a story on a USA Today report about the top 5 hottest vehicles in the US, hottest being defined as those generating the most buzz in the marketplace or something like that. Four of them were either trucks or large SUVs — the Toyota Highlander and Tacoma, the Subaru Forester, and the Volkswagen Atlas. Number 1 in the rankings, however, was the Tesla Model 3.
Bigger Is Better At Volkswagen
At Volkswagen, the 7 passenger Atlas and 5 passenger Tiguan accounted for 43% of total October sales. SUV sales at VW are up 38% over a year ago. You don’t need a weatherman to know which way the wind blows, and you don’t need a soothsayer to know if you want to sell a lot of cars to Americans you better have lots of SUVs and trucks in your lineup.
The Alliance to Save Energy’s 50×50 Commission is working on ways to cut the amount of energy used by the US transportation sector in half. While that is a laudable goal, it’s hard to see how it can succeed if the vehicle mix continues to skew towards larger, less efficient vehicles, and if emissions standards continue to lag behind other nations. Note, for instance, that Volkswagen, for all its promises about bringing electric cars to market really, really soon, sells not one electrified model all across America. Not one! No hybrids, no plug-in hybrids, and no battery electrics. It sold a whopping 62 VW e-Golfs in the US last month, a sharp increase over the 32, 18, 32, and 14 of the previous four months. Good luck finding one on a dealer lot near you.
Mitsubishi & BMW
Here’s some really disappointing news: Sales of the Mitsubishi Outlander PHEV — a vehicle that has been a sales leader in Europe — are dismal in America. Mitsubishi delivered only 309 of them in October. We have regular readers who own this vehicle and are very happy with it, but customers are staying away from Mitsubishi dealers in droves. That may have more to do with the company’s atrocious US dealer network rather than anything inherently wrong with its vehicles, but it’s unfortunate that this fairly affordable, spacious, plug-in SUV hasn’t seen strong sales in the land of SUVs.
There’s good news plus bad news with regard to BMW and electric vehicles. The good news is more than 7% of all BMWs sold in America have an electric motor. The bad news: sales of those cars are down 8.5% from a year ago. Naturally, we assume part of that is a stampede to the Tesla Model 3, which is presumably the good part of that story. But once again, with BMW, the message is SUVs rule, sedans drool. Total sales of BMW sedans is down nearly 2% over last year while sales of its X3 and X5 SUVs — which BMW insists on calling light trucks — are up almost 10%.
Toyota & GM
The story is the same at Toyota. Sales of the largish Highlander and midsize 4Runner are up strongly for the year while the Tacoma is scorching the sales charts with a 30% rise since this time last year. The success of the Tacoma is why Ford is reviving the Ranger midsize pickup truck.
Sales of Camrys and Corollas continue to sputter along. Toyota has now sold more hybrids than any other manufacturer, though it should be noted that hybrids — once the cutting edge of automotive technology — are now so mainstream they hardly raise an eyebrow.
Toyota Prius sales are down a staggering 18% (daily selling rate is down more than 21%). Considering Tesla told us a few months back that the Prius was the #1 car traded in for a Model 3, we again expect a Tesla effect here that is eating into Toyota’s “green car” profits.
The folks at General Motors are also riding the SUV/light truck wave. Later this month, it will re-introduce the Chevy Blazer, a model that was dropped from the lineup years ago but is being revived to satiate Americans’ seemingly unquenchable thirst for trucks, trucks, and more trucks.
The General is a bitter enemy of Tesla, fighting tooth and nail to keep it from selling cars directly to customers in several states, but there is one thing about Tesla it likes — reporting sales on a quarterly rather than monthly basis. This is a relatively new move for the General, which let us see monthly model sales not long ago. Sales for its Volt and Bolt plug-in cars therefore involve a bit of guesswork, but according to estimates by InsideEVs, sales of the Chevy Volt totaled 1,475 in October while sales of the Chevy Bolt were only 2,075.
Chevrolet, one of the greatest marketing machines in history, sold fewer than 4,000 of its electric cars in October, while Tesla was presumably somewhere around 20,000 electric car sales. A company with no franchise dealers that does no advertising is embarrassing GM’s efforts? Are you kidding me?
LEAF Is Falling
Nissan is also running into severe headwinds, with sales of its LEAF electric car tumbling to just 1,234 cars sold in October, even though the dowdy first-generation car has been replaced with a more visually appealing and longer range model (that is leading electric car sales in Europe this year). The car still suffers from short range fears at a time when many US customers won’t even consider an electric car with less than 200 miles of range.
It’s a perception thing. People don’t really need 200 miles of range to go the 24.5 miles the average American drives every day. People still don’t understand that an electric car is more like a cell phone or laptop computer — you plug it in when you’re done using it for the day and it’s ready to go the next morning. But perception is reality and the LEAF simply doesn’t measure up in the minds of many. Whether that will change next year when it finally gets a competitive 60 kWh battery remains to be seen.
The EV In America
Bright spots for electric cars in America are outrageously strong demand for the Tesla Model 3 and, well, strong demand for any Tesla a buyer can afford. The rest of the US electric car market is more “Ho hum” than “Yippee!”
Let’s see … if only there were an all-electric crossover SUV with decent range. That would be great, huh? Actually, there is. It’s called the Tesla Model Y and it has recently been approved for production. Look for it to appear in about 18 to 24 months and take the market by storm when it gets here. The Model Y could sound the death knell for legacy manufacturers who think they can continue selling cars with gasoline and diesel engines forever.