Auto Execs Respond to Rising Gas Prices By Reinventing Small Vehicles

January 19, 2011

Auto executives are preparing for $3 gas—or maybe $4 or $5—to become the new reality. One piece of evidence is a new generation of electric drivetrains, from hybrids to pure electric cars, destined for vehicles in greater numbers than ever before. At the same time, the very definition of a segment—like what is a compact, a coupe, or an SUV—is being reshaped into smaller packages, with sleeker designs and a lot more connected infotainment.

Executives gathered at the 2011 Detroit auto show sang the small car chorus. “As gas prices get above $3, people start making different decisions,”said Ford Chief Executive Alan Mulally. GM CEO Daniel Akerson said rising oil prices would skew those decisions toward smaller vehicles. And Jim McDowell the U.S. head of Mini—the brand perhaps most associated with redefining the appeal of small cars—said, “When gas increases in price, it provides a natural incentive for people to accelerate a decision that they’ve already been thinking about.”

Here are three examples of segment-busting sharply styled smaller cars are on display at the Detroit show, which runs through this weekend.

Chevy Sonic – Small and Sporty

The Chevy Sonic is G.M.’s best stab at reshaping the compact car into cool. That means a youthful, aggressive design, backed by turbocharged performance and fun handling. The 138-horsepower Sonic will be offered as a four-door sedan and a sporty five-door. Chris Perry, vice president of Chevrolet marketing, said the Sonic combines small car practicality with “the passion for driving that Chevrolet vehicles like the Corvette are known for.” We expect the Chevy Sonic, going on sale in fall 2011 as a 2012 model, to join the 40-mpg club.

Hyundai Veloster – Connected Coupe

Hyundai Veloster
Hyundai Veloster

Looks like it has just two doors? Nope, a third small one on the passenger side.

The Veloster, which goes on sale this summer, is a coupe with a unique third door for rear-seat access, powered by a 1.6-liter direct direct-injected four-cylinder engine mated to Hyundai’s first dual-clutch transmission. And it’s loaded with connectivity, such as Hyundai’s Blue Link telematics system, Pandora web radio with seven-inch touch-screen display, Gracenote display technology with voice recognition, AVI and mpeg video playback via USB, video game console connectivity with 115-volt power outlet, and of course, Bluetooth hands-free phone. Expect 40-mpg on the highway with this one as well, which Hyundai brags is better highway fuel efficiency than Honda CR-Z Hybrid.

Ford Vertrek – Sleeker Small SUV

The Ford Vertrek concept is a vision for a smaller and sleeker utility vehicle. The concept retains most of the cargo space of an SUV, while powering the vehicle with a 1.6-liter EcoBoost engine equipped with stop-start (some call it micro-hybrid) technology to deliver best-in-class fuel economy. The sleek appearance of the Ford Vertrek concept is all about aerodynamics, to support high mpg and low emissions. Ford says it will “complement the high-tech powertrain solutions Ford envisions.” Can you say future hybrid and/or clean diesel? Keep in mind: It’s on Ford’s C-platform which can take hybrid, plug-in hybrid, or full electric drivetrains.


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  • Warren Grove

    It will be interesting to see what the “real world” mpg will be for the Veloster. It may be higher or lower than EPA numbers.

    I can testify that my real world highway mileage for the CR-Z is 45 mpg!

  • Anonymous

    No need to reinvent the small car – just look over the ocean to Europe and you will find plenty of small cars.

  • John Salazar

    You have a CR-z?

  • JamesDavis

    This ‘small ugly gas guzzling’ car deals that the auto makers are coming out with every time gas prices increase is the ‘lazy mans’ way of not wanting to use his brain to come up with something better. My idea of stopping high rising gas prices in their tracks is…all electric. You will never have to stop at another gas station or suffer through ‘price anxiety’.

  • Dom

    “No need to reinvent the small car – just look over the ocean to Europe and you will find plenty of small cars.”

    Amen. If the government really want to encourage more fuel efficient vehicles, the easiest thing to do would be to allow any vehicle that meets European safety and emissions standards (which I’m sure are plenty adequate) to be legal to sell here. Presto… instant access to tons of great fuel efficient cars, gasoline and diesel. I’d be in car heaven. But nooo… that’d make to much sense. Since that won’t happen, I just hope these cars are come standard with a manual transmission…

  • Anonymous

    Hello Hyundai

    Please add a 4th door on the drive side just like the 1 on the right side and make this a 5 door vehicle or the quad coupe.

    Saturn sold a 3-door vehicle and never sold well. Good that this vehicle joins 40 MPG club.

  • Anonymous

    Escape comes in Gas, Flex-fuel & Hybrid versions in USA.
    While in Europe I believe Kuga has Gas & Diesel versions.

    How are they going to merge all this with 1 Vertrek.

    First – knock out the V6 version, after all CR-V sells better with V4 alone.

    Second – Make all vehicles flex-fuel since it costs less than $100 to make a vehicle a flex fuel vehicle.

    Third – Offer a Hybrid option for USA & Diesel option for Europe & Asia.

    Its a smart idea to make the vehicle a bit shorter in length, since the height gives lot of space in this type of vehicle. CR-V (Current generation) is 3 inches shorter than the previous generation and is out selling Civics.

  • Warren Grove

    In response to John, yes, I have had my CR-Z since it came out in August 2010. EX model with navigation.

    I am quite pleased with it!

  • Dom

    “How are they going to merge all this with 1 Vertrek.”
    “Third – Offer a Hybrid option for USA & Diesel option for Europe & Asia”

    No no no!! I would want the diesel version to come to the USA!! I know this is a hybrid fan site and all, but daggone it some of us prefer other options!

  • cld

    “Amen. If the government really want to encourage more fuel efficient vehicles, the easiest thing to do would be to allow any vehicle that meets European safety and emissions standards (which I’m sure are plenty adequate) to be legal to sell here.”

    Ah, there’s the rub. The current Euro 5 emission standard for diesels is 0.18 g/km NOx, which is about 4 times higher than US EPA Tier 2 Bin 5 (0.043 g/km). Even the Euro 6 standard due in 2014 sets maximum NOx levels at 0.08 g/km. Particulate matter for both European and US standards is comparable (0.05 g/km for Euro 5/6, 0.06 g/km for Tier 2 Bin 5). That can be managed by exhaust filters. NOx removal, however, requires some system for catalytic reduction to get to Tier 2 Bin 5 levels. That means added cost, which means little likelihood of manufacturers bringing European sub-compact diesels to American shores.

  • cld

    “Amen. If the government really want to encourage more fuel efficient vehicles, the easiest thing to do would be to allow any vehicle that meets European safety and emissions standards (which I’m sure are plenty adequate) to be legal to sell here.”

    Ah, there’s the rub. The current Euro 5 emission standard for diesels is 0.18 g/km NOx, which is about 4 times higher than US EPA Tier 2 Bin 5 (0.043 g/km). Even the Euro 6 standard due in 2014 sets maximum NOx levels at 0.08 g/km. Particulate matter for both European and US standards is comparable (0.05 g/km for Euro 5/6, 0.06 g/km for Tier 2 Bin 5). That can be managed by exhaust filters. NOx removal, however, requires some system for catalytic reduction to get to Tier 2 Bin 5 levels. That means added cost, which means little likelihood of manufacturers bringing European sub-compact diesels to American shores.

  • veek

    Thanks for the encouraging article, but its first sentence has a glitch — $3+ per gallon fuel is “the new reality.” Right now, many car buyers are telling themselves “Fuel prices are high now but they will come down again, just like they always have. So it’s OK to buy that huge pickup that I really really need and deserve.”

    As long as people think fuel prices will come down, “just like they always have,” many will keep buying bigger cars. What might help is a guarantee that fuel prices will stay above a certain level, such as through a tax which kicks in above a certain level, as well as registration and sales tax disincentives for fuel wasters. There is almost no chance of that happening.

  • OhMiGod

    ” AutoblogGreen was sent the an anonymous message through a friend (reprinted in whole after the jump) that describes the ongoing disappearance of Wikipedia articles about hybrid vehicles like the Toyota Camry Hybrid, Toyota Accord Hybrid and Ford Escape Hybrid. Why are these pages disappearing? ….” (http://green.autoblog.com/2011/01/19/electric-car-pages-on-wikipedia-in-danger-of-disappearing/)

  • Dom

    cld said “Ah, there’s the rub. The current Euro 5 emission standard for diesels is 0.18 g/km NOx, which is about 4 times higher than US EPA Tier 2 Bin 5 (0.043 g/km). Even the Euro 6 standard due in 2014 sets maximum NOx levels at 0.08 g/km. Particulate matter for both European and US standards is comparable (0.05 g/km for Euro 5/6, 0.06 g/km for Tier 2 Bin 5). That can be managed by exhaust filters. NOx removal, however, requires some system for catalytic reduction to get to Tier 2 Bin 5 levels. That means added cost, which means little likelihood of manufacturers bringing European sub-compact diesels to American shores.”

    Yeah, it’s much better that we keeping driving monster SUVs that are so much cleaner, as opposed to these horrible dirty diesel cars that get 40-60mpg… horrible European cars… Europeans must be dying all over the place from the pollution!

    In all serious though, this is what makes me mad. People get so obsessed over tailpipe emissions, but fail to look at the big picture. Sure your 25mpg typical American car might meet a cleaner tailpipe standard, when you compare it to a similar sized diesel car that might get say 40mpg, which is really the better choice? Gasoline also evaporates, diesel doesn’t. Besides, all modern diesels are going to be a heck of a lot cleaner than a lot of ten year old cars. I don’t agree that EPA emission standards are better than Euro standars, just different. Besides, if you prefer gasoline, Europe has plenty of much better gasoline cars than we get. Just let us freaking buy them!

  • Pierre

    @Dom: I don’t think those buying those ‘monster SUVs’ are any time soon to switch to a SMALL car, with diesel engine or not, as long as they think the era of ‘cheap’ gasoline is not ending. Have you consider moving abroad?

  • Dom

    “Have you consider moving abroad?”
    It’s tempting… especially as I’m becoming less thrilled with American automotive taste, i.e. automatic everything. Basically the dumbing down of the driver experience by making the car ever more complex. And by driver experience I’m not talking about turning it into a media entertainment system. Oh well…

    The cars in this list sound promising anyway…

  • Dom

    Pierre said, “Dom: I don’t think those buying those ‘monster SUVs’ are any time soon to switch to a SMALL car, with diesel engine or not, as long as they think the era of ‘cheap’ gasoline is not ending. Have you consider moving abroad?”

    By the way, I’m not talking about just very small cars… I’m talking about wagons (Subaru diesel anyone?), vans, small to mid-sized diesel trucks, etc. cars that we be very useful and very fuel-efficient compared to our current selection. Europe gets some really nice turbo gasoline engines that would be nice to have as well.

  • tapra1

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  • Jonny Williams

    I don’t agree that EPA emission standards are better than Euro standars, just different. Besides, if you prefer gasoline, Europe has plenty of much better gasoline cars than we get. Just let us freaking buy them! visit