Minivan sales have moved over to the slow lane Vehicle's share of light-truck market appears to be slipping

Auto industry

December 20, 1998|By Ted Shelsby | Ted Shelsby,SUN STAFF

The minivan, a vehicle that nearly killed off the station wagon while saving Chrysler Corp. from extinction, is now struggling to hold its own.

Minivan sales may drop slightly this year, but they are going to be very close to the 1.2 million units sold in each of the past five years, said Ralph Sarotte, general manager of minivan operations with DaimlerChrysler Corp., which accounts for nearly one of every two vans sold nationally.

Sarotte said that minivans hold about 8 percent of the U.S. passenger vehicle market, down from a peak of 9 percent four years ago.

But the van's share of the fast-growing light-truck market is showing signs of slippage. Three years ago, minivans, including the Chevrolet Astros and GMC Safaris made in Baltimore, had 20 percent of the U.S. light-truck market. Today, it's down to about 16 percent.

At the same time, sales of sport utility vehicles, or SUVs, are red hot. Americans bought two SUVs for every minivan sold last year, pushing SUV sales to 2.4 million.

While minivan sales are off slightly this year, SUV deliveries are up nearly 15 percent.

Despite these trends, nobody is predicting the demise of the minivan. "They are not going to go the way of the station wagon," said David E. Cole, director of the University of Michigan's Office for the study of Automotive Transportation.

"They have become a core product," Cole said. "Anybody who wants to be a real player in automotive manufacturing industry can't afford to ignore them."

"Our minivan sales have been holding firm," said Dick White, vice president of Don White's Timonium Dodge on York Road. "The SUVs seem to be stealing more sales from the car market."

Sarotte, the DaimlerChrysler executive, agreed. "If the SUV market is growing and minivans are holding their own, the SUVs sales have to come from cars," he said.

He said motorists looking for new ways of expressing themselves are trading in their sporty cars and large sedans for Ford Explorers, Jeep Cherokees, Chevrolet Suburbans and other SUVs.

At the same time, the sporty segment of the car market, which includes the Ford Mustang, Chevrolet Camaro and the Mazda MX-6, is off 14.4 percent, according to Automotive News, an industry trade publication.

Sales of the upper mid-range sedans, a category that takes in the Dodge Intrepid, Chevrolet Caprice and Buick Roadmaster, are off 4 percent.

"There have been rumors of the minivan's demise for a year or so, but I don't see this happening," said George E. Hoffer, a professor of economics at Virginia Commonwealth University in Richmond, who follows the auto industry.

"They are not very sexy and your teen-age son will hate to drive it, but I don't see them going away. They are like the utility infielder on a baseball team. They do everything that is asked of them, but they don't get a lot of credit."

"People don't buy vans to make a fashion statement," said Cole. "People buy them because nothing else gives them the same interior space. My daughter-in-law has two kids and two retrievers, a Labrador and a golden. An SUV was not an option."

Despite flat sales over the past five years, manufacturers are not moving away from the minivan market.

Cole noted that Honda Motor Co. introduced its all-new Odyssey minivan in late October. Ford has redesigned its Windstar for the 1999 model year. Toyota has a new Sienna. Mercury and Nissan have spruced up their twin vans, the Villager and Quest.

More minivans are likely, said Hoffer. "Volkswagen is expected to bring back its bus and Mercedes-Benz is also looking at jumping into the market."

The minivan was first introduced by Chrysler in November 1983. At the time, Chrysler was on the brink of going out of business and was supported by a loan guarantee from the federal government.

"We spent $750 million on the development of the minivan when we didn't have the money," said Sarotte. "The investment was paid back almost overnight. There is no question about it, it was the turnaround vehicle for the company."

Nobody believes the minivan will ever have that impact again, but they also do not envision its demise.

"Minivans don't have the pizazz of the popular SUVs," said Hoffer, "but they are practical and pragmatic vehicles that meet a real need. They are going to be around for a long time."

Pub Date: 12/20/98

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