General Motors And Ford To Ditch Some Of Their Small Car Brands

Reports indicate that General Motors intends to discontinue the Chevrolet Sonic while its rival Ford Motor is also planning to kill Fiesta in the United States. Besides the two subcompact cars General Motors is also considering the discontinuation of Impala, a full-size sedan, while Ford is also intends to ax Taurus, also a full-size sedan.

This is an indication that subcompact cars in the United States are losing popularity. According to Autodata, in the subcompact segment, the Fiesta and the Sonic were fourth and third best sellers respectively. Once discontinued the subcompact car segment will be left with Honda Fit, the second best-seller and Hyundai Accent, the best seller.

Low gas prices

For years now consumers in America have been abandoning subcompact cars in favor of crossovers or sports utility vehicles in the wake of low prices of gasoline and improved fuel economy of the ‘fuel guzzlers’. Per Autodata the sales of passenger cars fell by 10.9% last year. Subcompact vehicles fell by an even bigger figure – 25.9%. With 222,776 subcompact cars sold in 2017 this was just 1.3% of the overall U.S. vehicle market.

Chevrolet was introduced to the market shortly after the bankruptcy of General Motors and a federal auto bailout in 2009. Last year sales of the Sonic fell by 45.2% and GM namahed to sell 30.290 units. Sales of Fiesta on the other hand fell by 5.2% and Ford moved 46,249 units of them.

GM and Ford are not the only automakers who are ditching passenger vehicles. Fiat Chrysler Automobiles for instance has largely abandoned the small-car business after it ditched Chrysler 200 and Dodge Dart. The carmaker, which relied mostly on its Ram trucks and Jeep sports utility vehicles however still has a few small cars in its portfolio and this includes those from the Alfa Romeo brand which is struggling.

Market shift

According to Brian Johnson, an analyst at Barclays, it is likely that Ford could reduce its portfolio of cars in the United States to Focus and Mustang while abandoning Fiesta, Fusion and Taurus as more and more consumers shift to pickups, SUVs and crossovers.

Per the marketing and sales chief of Toyota North America, Bill Fay, around two million sales of passenger cars have been lost to pickups, SUVs and crossovers in the recent past.

“When you have a three- or four-year market shift like we’ve had, everybody has to look at that and either decide to reinvest in cars … or stop investing in them altogether,” Fay toldUSA Today.

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