The continuing rise of the SUV
Investigating the phenomenal growth of the SUV market from a niche product to a core segment where demand continues to surge
The fact that SUVs, or Sports Utility Vehicles, are ubiquitous on the UK’s roads will come as no surprise to motor trade professionals. Despite the overall British car market reaching its peak in 2018, the SUV segment broke sales records. The Society of Motor Manufacturers and Traders (SMMT) reported 325,800 registrations, representing over 38% of the new car market.
Compared to other segments, SUV buyers were less deterred by media reports surrounding diesel, as diesel SUV registrations fell by 21% in the first quarter of 2018, compared to a 41% drop across all other segments. Across the globe, SUVs also improved their market share significantly with 27.6 million vehicles sold in 2017, which constituted a quarter of all car sales worldwide.
A key factor behind the success of SUVs is their flexible practicality, interior space and general curb appeal, which has poached buyers away from saloons, estates and hatchbacks. Furthermore, SUVs from volume brands have also proven successful in tempting buyers from conventional vehicle body types, creating desire for products previously only achieved in the premium sector. Purchasing an SUV can be seen as being more emotional than rational in marketing terms, resulting in motorists spending more money on an emotionally-driven purchase.
Linda Jackson, CEO of Citroën UK explains: “Prices are led by what consumers will pay and clearly they’re valuing SUV robustness, driving position and big wheels, or they wouldn’t be buying them in the way they are. Clearly, SUVs are profitable for any manufacturer.”
The growing popularity of SUVs also provides dealers with the opportunity to secure incremental revenue from paint protection systems as the best way for customers to maintain the appearance of their ‘do anything’ vehicle.
The dependency on SUVs by manufacturers to sustain market share and revenues is also illustrated by the range of brands whose top-selling products across Europe are SUVs. These include Nissan, Hyundai, Kia, Mazda and Mitsubishi, as well as Jaguar, Lexus, Porsche, Maserati and Volvo. For Volvo, SUVs equate to half its global sales but represent more than 50% of the Swedish manufacturer’s profits.
Looking ahead, as digitisation and electrification continues to accelerate and transform the motor industry, the popularity of SUVs appears set to continue as more products and drivetrain technologies are offered. For example, Jaguar has launched its all-electric I-Pace, which is set to be followed by pure electric SUVs from competitors including the Audi e-tron, BMW’s iX3 and the Mercedes-Benz EQC.
Although the growth of SUVs has undoubtedly been a success for manufacturers, it also poses the risk of market saturation, that could lead to customers seeking to differentiate themselves. However, Trevor Mann, Mitsubishi’s Chief Operating Officer, draws a parallel with the decline of saloon cars in Europe: “A lot of people in the 1970s and ‘80s asked how far hatchbacks could grow when they were introduced and they then took over the European market. So, until someone comes up with something new, I think SUVs are here to stay.”
The growing popularity of SUVs also provides dealers with the opportunity to secure incremental revenue from paint protection systems as the best way for customers to maintain the appearance of their ‘do anything’ vehicle. Autoglym’s market-leading LifeShine Vehicle Protection System (VPS) leads the way when it comes to paint protection, by using the latest technology. LifeShine’s paint protection formulation now features colour enhancement technology to provide superior depth of colour. Tests carried out with competitor products showed that the improved LifeShine product had a superior depth of colour difference of up to 31%.
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