SUVs are wreaking havoc in the small car segment. Sales of urban cars in Europe have suffered a real bump in the first half of 2022. Registration figures that show that the rise of SUVs is accelerating the decline of small and, above all, cheap cars.
The European car market has many open fronts. There are many challenges and problems. Stock crisis in dealerships due to the global shortage of microchips and semiconductors, price escalation, inflation, fear of the possibility that the economic scenario will become even more complicated and, as if that were not enough, to all this we must add the transition to electric car.
Car sales in Europe continue to decline. Despite the difficult times we are going through, the so-called “SUV fever” shows no signs that it will subside in the short term. Roughly one in two new cars sold at European showrooms is an SUV. Unfortunately, the unstoppable rise of SUVs is accelerating the decline of cheap small cars.
The popularity of SUVs comes at the expense of smaller cars
In recent times, it has been analyzed how SUVs have displaced certain types of vehicles to a second or even third place. Especially the general minivans and sedans. However, these sales figures show that now not only a specific vehicle format is affected. Registrations of urban cars (segment A), subcompact (segment B) and compact (segment C) have fallen by 22% in the first half of 2022 to reach 2.05 million units.
If we focus on the city cars we will find ourselves in a truly worrying situation. Between the months of January and June have accumulated 455,400 registered units, 27% less than in 2021. Many car brands have decided to leave the category. The reduction in supply has allowed more expensive models, such as the FIAT 500, to increase their advantage. But, as might be expected, higher prices have a direct impact on demand.
The best-selling small cars in Europe in 2022 (Jan-Jun)
FIAT 500 vs KIA Picanto, video comparison of small cars
The process of electrification of small cars
Last but not least, we must also make a special mention of the electrification process that the urban car segment is experiencing. Not a small part of the models available on the market have become 100% electric vehicles. And others will soon. This move to fully electric mobility also directly affects the sale price.
The Dacia Spring is one of the cheapest small electric cars that we can find in our dealerships. However, for the sale price to be really cheap, it is still necessary to take advantage of the available aid. The new generation of small electric cars that the Volkswagen Group is preparing will have an approximate price of between €20,000 and €25,000, which allows us to get an idea of the future we are heading towards when small and cheap gasoline-powered cars have missing.
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JATO Dynamics