Small Cars Hit the Big Time

Published May 2, 2008

Sales of Toyota’s subcompact Yaris increased 46 percent in April 2008. The Honda Fit and Ford Focus also reported record sales.

April sales figures for cars and trucks sent a clear and resounding message to the auto industry: Make smaller more fuel-efficient cars or die. Here are the facts:

• About one in five vehicles sold in the United States was a compact or subcompact car.
• Sales of traditional Sport Utility Vehicles are down more than 25 percent this year—and full-size pickup sales have fallen more than 15 percent.
• For the first time, fuel-efficient four-cylinder engines surpassed six-cylinder models in popularity.
• The Toyota Prius, a mid-size car, posted the single most dramatic gain in sales—up 53 percent up—compared to one year ago. Among all passenger vehicles, it ranked number eight in April sales.
• Sales of subcompacts soared. Sales of the Toyota Yaris increased 46 percent. The Ford Focus jumped 32 percent, and the Honda Fit had a record month.

And here’s how auto industry executives and analysts responded:

• “It’s easily the most dramatic segment shift I have witnessed in the market in my 31 years here,” said George Pipas, chief sales analyst for the Ford Motor Company. (New York Times)
• “The era of the truck-based large SUVs is over,” said Michael Jackson, chief executive of AutoNation, the nation’s largest auto retailer. (New York Times)
• "We continue to see that fuel efficiency will remain one of the top priorities for purchasing consumers," said Bob Carter, general manager of Toyota's U.S. division. (Associated Press)
• “This shift appears to be a permanent situation,” said Jesse Toprak, chief industry analyst for the auto information Web site Edmunds.com. (New York Times)
• "What we did not count on is oil being nearly $120 barrel," said Mike DiGiovanni, General Motors sales and market analyst. (Chicago Tribune)

The New York Times warned, “Automakers ignore the move to smaller vehicles at their own peril.”