General Motors, Ford Discontinue Subcompact Cars Sonic, Fiesta

The Detroit automakers, General Motors (GM) and Ford plan to show exit doors to Chevrolet Sonic & Fiesta. The move is a consequence of the shift in the US automobile market towards larger vehicles, cited by The Wall Street Journal.

GM will probably stop manufacturing its award-winning Sonic model by this year-end. Ford may discontinue selling Fiesta from next year beginning.  The Journal also projects Ford to quit full-size Taurus sedan and GM to ax the full-size Impala sedan.

GM did not comment on the assumption. However, a Ford official said to CNBC, “As we have said, by 2020 trucks and utilities — including their electrified versions — are going to be almost 90 percent of our volume. Passenger cars, including Fiesta and Taurus, remain an important part of our lineup.”

Reportedly, in 2017, Sonic sales volume went 45.2% down to 30,290, while Fiesta sales dived to 46,249, a fall of 5.2%. Overall, the passenger car segment sales witnessed a fall of 10.9% in 2017, according to Autodata. The sales of subcompact cars saw a major downfall of 25.9% to 222,776 vehicles. Hence the subcompact cars represented only 1.3% of the U.S. vehicle market.

Change in Consumer Taste

The plummet in passenger cars sales in the US and a tough competition from Japanese manufacturers have left automakers with no choice but shun small car segment.

Chevrolet Sonic GM

The award-winning subcompact car, Chevrolet Sonic

The American buyers are inclined towards larger vehicles like pick-up trucks, sports utility vehicles (SUVs), crossovers, and electric editions. The automobile manufacturers have filled the market with a spectrum of full-size vehicles in response to their booming demand.

According to goodcarbadcar.net, “7.7% fewer small cars were sold in the USA in February 2018 than last year’s, putting the compact car market as a whole down 8.7% year-to-date at the end of the first two months of 2018.”

Low gas prices and high fuel efficiency in larger vehicles and SUVs are considerable dual offers for car buyers. Along with this, the customers get more storage space, elevated ride height and the all-wheel-drive features in the SUVs.

Moreover, the subcompact cars like Chevrolet Sonic and Ford Fiesta have lesser margin compared to the profitable large-vehicle segment.

Ford Fiesta Chevrolet Sonic

Ford may discontinue Fiesta by next year

The USA Today published an automakers performance report for February 2018. The Detroit Three automakers had a terrible month. General Motors sales sank 7% wherein specifically Chevrolet brand slump 8.8%. Ford overall sales dropped by 6.8% with even severe slope in Ford’s passenger car sales by 12.1%. Fiat Chrysler fell down 1.6%.

The Japanese automakers’ sales shot up with Toyota climbing 4.5% and Subaru growing 3.8%. However, Nissan fell 4.3% and Honda plunged 5%.

Avatar
Carrie Ann
Carrie Ann is Editor-in-Chief at Industry Leaders Magazine, based in Las Vegas. Carrie covers technology, trends, marketing, brands, productivity, and leadership. When she isn’t writing she prefers reading. She loves reading books and articles on business, economics, corporate law, luxury products, artificial intelligence, and latest technology. She’s keen on political discussions and shares an undying passion for gadgets. Follow Carrie Ann on Twitter, Facebook

Recent Posts

Babcock facing writedowns of £1.7 billion, plans to cut 1000 jobs

Babcock facing writedowns of £1.7 billion, plans to cut 1000 jobs

Babcock International Group PLC, the UK defense contractor, said that a comet review for the financial year ending March 21 had identified impairments and charges totaling approxim
14 hours ago
France’s water management utilities, Veolia and Suez, finally merge after long battle

France’s water management utilities, Veolia and Suez, finally merge after long battle

Veolia and arch-rival Suez, the two French waste management utility companies, have struck a deal worth nearly 13 billion euros ($15.44 billion)to merge after months of wrangling.
2 days ago
Impossible Foods mulling IPO at $10 billion valuation

Impossible Foods mulling IPO at $10 billion valuation

Impossible Foods, the makers of the widely popular plant-based burgers, plans to go public with a likely valuation of $10 billion. The vegan burger company was valued at $4 billion
2 days ago
Aramco sells minority stake to EIG Group-led consortium for $12.4 billion

Aramco sells minority stake to EIG Group-led consortium for $12.4 billion

Energy giant Saudi Aramco is selling a minority stake for 12.4-billion-dollar in a newly formed oil pipeline business to a consortium led by US-based EIG Global Energy Partners. Th
2 days ago
Elior acquires Nestor, the single meal food delivery startup

Elior acquires Nestor, the single meal food delivery startup

Elior, the corporate catering company, has acquired the French startup Nestor for an undisclosed amount. Nestor, a Paris, France-based food delivery service, started in 2015 with a
4 days ago
Axa gears to buy office space worth €800m in European cities

Axa gears to buy office space worth €800m in European cities

Axa Investment Managers, the French fund house, is not too worried about predictions that the post-pandemic world will see more people working from home and office real estates shr
5 days ago