Mainstream large cars, such as the Avalon, Maxima, Taurus and Impala, continue to lose favor. Their combined share of the U.S. market has retreated from 5.8% in 2008 to just 3.5% in 2012 (the results were similar this past January, with the large car share declining from 4.1% a year ago to 3.9% this year). Large cars now account for a smaller slice of the U.S. market than minivans, itself an endangered species. And the number of large cars continues to decline, down from 14 in 2008 to 7 now. Manufacturers are focusing on the midsize car segment (which had 17.6% of the market in 2012), offering quick redesigns, hybrid, diesel and all-electric powertrains, a plethora of safety and connectivity features, and greatly improved fuel economy. Every mainstream make is in the midsize car arena, while less than half offer a full-size car.
The broad movement of the U.S. light vehicle industry is in the direction of smaller vehicles, It is partially due to CAFÉ requirements and this suggests the current group of large cars will either disappear and the current midsize offerings will become the future fullsize cars or the current models will shrink. In the latter case, all vehicles would have to shrink to avoid having the fullsize vehicles overlap with midsize cars and that seems unlikely. It seems more probable that in the long term a "re-definition" or "relabeling" will occur and the current crop of midsize cars such as the Camry, Accord, and Fusion will be the largest cars in the non-luxury space.
However, Polk's light vehicle forecast indicates that the current large car category will survive in the near term. This is due in part to the upcoming arrival of three additional large cars. Later this year, Chevrolet will launch the Chevrolet SS, an 8-cylinder-powered muscle car built on the same Australia-sourced platform as the defunct Pontiac G8. In 2014, Kia will re-enter this segment with the Kadenza. In 2015, Volkswagen will revive the Phaeton name with a car slotted above the Passat. Polk forecasts that large mainstream cars will capture 3.2% of the industry this year and 2.7% in 2015.
The future of large luxury cars seems more certain. While this category's share of the industry has, like mainstream large cars, declined over the past years (from .76% to .46%), the number of large premium cars has remained stable in the past three years at either 7 or 8. These upper-end cars are known as flagship models because they lend an air of luxury and prestige to their respective brands, and such an image differentiates these makes from those luxury makes lacking such high-end offerings. With these large, expensive, high-end cars, Audi, BMW, Cadillac, Jaguar, Lexus, Mercedes-Benz and Porsche portray a more upscale, premium image than such competitors as Acura, Infiniti, Lincoln, and Volvo. For this reason it seems unlikely that the true premium makes will depart from the large premium car segment anytime in the near future.
Posted by Tom Libby, Lead Analyst, North American Forecasting, Polk (03.19.2013)