news

한어Русский языкEnglishFrançaisIndonesianSanskrit日本語DeutschPortuguêsΕλληνικάespañolItalianoSuomalainenLatina

[Text/Observer.com Xiong Chaoran] "Americans are rushing to buy small cars again, not because they want to, but because they are the only cars they can afford."

On August 3rd, local time, Axios News Network pointed out this social reality in the United States, reporting that due to higher prices and high loan interest rates, it is increasingly difficult for Americans to buy their dream new cars, so they often have to buy a smaller car or look for a cheap second-hand car. Therefore, the resurgence of small cars is entirely because these cars are cheap.

The report also pointed out that because China's electric vehicles are cheap and good, it has also prompted American automakers to turn to launching smaller and more affordable cars. Ford Motor CEO Jim Farley recently believed that the best way for American automakers to compete with Chinese electric vehicles is to launch small cars.

"We have to fall in love with small cars again, which is very important for our society and the popularity of electric vehicles." Farley told the Guardian that although everyone likes big cars, including himself, vehicle weight is an important issue. "These huge electric vehicles will never make money: even with low-nickel, lithium iron phosphate (LFP) chemistry, the battery costs up to $50,000, and they will never become affordable."

Chevrolet Trax data map

Small cars have outsold other vehicle types in the U.S. this year, according to Cox Automotive, an automotive services and data group. While U.S. auto sales rose about 2% in the first half of the year, sales of subcompact crossovers rose more than 20%. Meanwhile, compact cars and SUVs also grew 18% and 12%, respectively, while full-size pickup truck sales fell 4%.

But today's small cars sold in the U.S. are roomier than ever and often come with standard technology and safety features to satisfy the upscale tastes of budget-conscious buyers.

"But this is also part of the affordability challenge, with consumers paying an average of $11,000 more for a new car than they did five years ago," said Rebecca Lindland, senior director of industry data insights at Cars.com. "If you don't buy a car in five years, the price shock you're experiencing will be real."

The best example of this trend is the Chevrolet Trax, which starts at $21,495. GM redesigned the small SUV for the 2024 model year, making it larger, cheaper, but with more technology than the previous version. Even the base model comes with standard safety features such as automatic emergency braking and lane keeping assist, while the Premium version adds Apple CarPlay, a Wi-Fi hotspot, and adaptive cruise control, all for well under $30,000.

As a result, the Chevrolet Trax has gained favor with consumers, with sales of the vehicle increasing 230% compared with the first half of 2023. Other subcompact SUVs, such as Mazda's CX-30 (starting at $24,995) and Honda's HRV (starting at $25,100), are also selling quickly.

"Axios News Network" pointed out that in recent years, for American automakers, although small SUVs such as Chevrolet TRAX are popular, allowing them to remain competitive in the entry-level market, these automakers have basically given up on small cars.

But now, including Ford and Tesla, are planning to launch small entry-level electric vehicles priced below $30,000. The report believes that affordability for American car buyers is a real problem, which prompts people to give up the cars they really want and buy the cars they can afford.

This article is an exclusive article of Observer.com and may not be reproduced without authorization.