Global hunger for sport utility vehicles (SUVs) is soaring, with the trend set to continue in all major markets. While drivers enjoy the added comfort and safety that the elevated view provides, manufacturers are also happy as SUVs typically deliver higher profits.
Historically the larger four-wheel-drive vehicles, with higher body clearance, were used for specific needs such as farming, military use, and in countries where road quality was not the best. While that’s still the case, today the vehicles have a much wider appeal.
Most drivers should only need a sedan to navigate the pothole-ridden, but relatively flat, big city roads. For many though, these larger vehicles, that could nail an off-road test drive, seem to remain desirable and so SUV sales continue to climb.
Larger vehicles dominate in America
In the United States, SUVs and pick-ups made up almost 10 million of the 17 million total light vehicle sales last year. US sales of mainstream and luxury SUVs and crossovers alike have more than doubled since 2010 and rose five percent and seven percent respectively in 2017, even though overall industry sales declined two percent in the same period.
Lessons from Norway: An electric car hotspot
The larger SUVs dominate the sales statistics in the US, with models like the Ford Explorer, Jeep Grand Cherokee and Toyota Highlander all performing well, but we are also seeing continued demand for SUVs in the compact segment.
The environmental concern
One downside of SUVs is the environmental impact they create. An SUV is higher and heavier than a comparable passenger vehicle, so the energy required to move the vehicle is higher, leading to higher fuel consumption and higher harmful emissions. This hasn’t done much to dampen demand as yet, but a scenario in which energy prices increase significantly could well do so.
The conflict between the global need to address pollution problems, and consumers’ desire for bigger, less fuel-efficient SUVs, takes centre stage in China.
The pollution crisis choking Beijing and Shanghai prompted the Chinese government to drop coal in favour of solar and other clean energy sources.
As the United States increasingly embraces a pro-fossil fuels agenda, China continues to champion global climate action. But China’s appetite for SUVs is on the way up. In the past four years, SUVs were responsible for 66 percent of the overall growth in China’s car sales.
Supply chain of the future: Self-delivering cars
It could be because bigger vehicles are considered a status symbol, particularly among young people, but SUVs can also accommodate China’s growing family size, a result of the government dropping its one-child policy.
A greener growth
2017 was the first year in history that SUVs were the largest segment in Europe, making up six million of 20 million light vehicles sold. SUVs and crossovers have been the growth driver of the European light vehicle rebound over the past five years.
Take a walk down a street in any western European city and you’ll easily see the impact that compact and sub-compact SUVs have had in changing the segment demographics in western Europe. The trend arguably started with the first-generation Nissan Qashqai in 2007. These car-based crossovers are cheap to buy and cheap to run yet offer the status symbol and higher seating position that drivers increasingly seem to value.
The growth in global SUV sales is expected to continue in all major markets. As the focus on environmental issues gets stronger, however, the capabilities of SUVs will change.
Analysts expect more sales of smaller SUVs, while auto manufactures say they are developing alternative powertrains like electric to meet the tougher emission standards that will come. While SUVs are here to stay, they will likely be greener going forward.