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Published on January 18th, 2019 | by Maarten Vinkhuyzen

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Range & The Myth Of The “City Car”

January 18th, 2019 by  


The myth of the modern “city car” originates from the makers of Swatch watches. They thought there should be a market for stylish, functional, small cars for city dwellers — the same kind of people who bought their watches. This “SwatchMobile” became the Daimler Smart car. It was very popular, mainly among journalists who found it was something quirky to write about it. As far as sales goes, it turned out to be a product for a very small niche.

But the concept of a city car became popular by marketing drones … eh, gurus and journalists. Defining your public for your product can be smart marketing. The risk is that you forget other potential customers when you concentrate too much on a single group.

In the showroom, all potential customers find the car that best fits them and their needs. The problem arises when marketing managers convince designers to make a car optimized for the limited use case of the imagined city dweller. It looks like a sound plan — there are many savings to be found when the car can be less capable.

When these glorified golf carts entered the showroom, however, the sales were hard to find. That’s logical, because people will accept a cheaper and less capable car but not a handicapped car that is unfit for all-around use. These models are known as A-segment and B-segment cars. Designations as kei cars, mini cars, super-minis, or by other odd names suggest that these are not fully-fledged cars.

And therein lies the problem. Even when customers like small cars, they don’t like crippled cars. The marketing departments target the young buying their first car. In real life, first cars are mostly hand-me-downs or used cars with a lot of experience. The young who do buy these cars buy them as second or third car, a neighborhood shopping cart.

The real core populations of the customer base are the middle aged and retired people, for whom it is perhaps the only car. The parking lots of retirement homes are full of these small cars. They are used for shopping just around the corner, and for visiting the grandchildren or touring through the country for a day.

When the diesel variants were removed from the lineup, they just lost some longer-distance commuters. When the top speed was lowered, the acceleration made more sedate, and the suspension a bit cheaper, the result was a movement by many customers to the C-segment, which has better margins. It was an actual win for the carmakers.

… Until the marketing department #*&%! started to think about electric cars. They were also just city cars, they decided. Now they could really design something that was just right for city use.

They don’t need range, they don’t need acceleration (electric cars limping away from traffic lights), they don’t need fast charging. They saw a bonanza before their minds eyes. They found a niche smaller than the Smart niche.

The number of people willing to buy a crippled car because it is a “city car” is very limited. You find some in the megacities of developing countries. In places where lack of money make something just better than a bicycle a big improvement. In Europe and the USA, not so much. Those customers are used to real cars, and even when they themselves don’t expect to use these features, they insist on all the capabilities a normal car has, if only for the resale value.

City cars are a marketing concept, but they don’t exist in the showroom, and should not exist on the carmaker’s drawing boards. Electric city cars are the biggest mistake of the past decade. 
 





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About the Author

Grumpy old man. The best thing I did with my life was raising two kids. Only finished primary education, but when you don’t go to school, you have lots of time to read. I switched from accounting to software development and ended my career as system integrator and architect. My 2007 boss got two electric Lotus Elise cars to show policymakers the future direction of energy and transportation. And I have been looking to replace my diesel cars with electric vehicles ever since. And putting my money where my mouth is, I have bought Tesla shares. Intend to keep them until I can trade them for a Tesla car.



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