Car companies in the last couple of decades have expanded into every niche and model type on the market. Cadillac wanted trucks; Kia wanted luxury; BMW wanted small cars. Every automaker had to have it all — a sedan, a subcompact, a compact, a sport utility vehicle, a minivan, a crossover, a pickup truck.
Reputations, however, are built on specific model types. Detroit automakers owned trucks and they had the loyalists to prove it. Toyota and Honda won much of the family sedan market, VW had the Bug, Mercedes had luxury sedans, Chrysler owned minivans, BMW had performance, and Volvo had safety.
These companies owned certain segments of the marketplace. But why settle for being king of the hill when you can be king of the universe? Automakers wanted to expand and grow. Huge investments were made to move into new spaces, meaning new vehicles in new markets. There were flops, many of them. Let’s look at the flops of the foreign manufacturers — not that Detroit doesn’t have them.
The big Nissan Quest minivan, built in a new plant in Mississippi, is a perfect example of a flop: 8,300 sales through November of 2009. It’s hardly worth the trouble. Chrysler’s Town & Country, by comparison sold 76,000.
Nissan made a big splash when it entered the big truck market with its billion-dollar baby, the Mississippi-built Titan pickup.
So far this year they’ve sold 16,894 Titans. Even during the slow economic recovery year, the Ford F-150 pickup sold 365,416 through November 2009.
Why the flops? We can only guess: It’s likely that Nissan’s dealers hadn’t any experience selling big pickups, which hurt, and Quest minivans were over-designed for its customers.
Honda has been particularly weak with new products: There’s the Ridgeline pickup, 15,000 sales in 11 months. Again, that’s not worth the trouble. And the Element, that boxy compact SUV with a four-cylinder engine, scored 13,500 sales in 11 months. That won’t pay for the tooling. Why? Again, we can only guess: Front-drive (as in the Ridgeline) just doesn’t make for good pickups, and the Element was never enough.
There’s the Mercedes R Class with only 2,700 sales through November. Why? It looks too much like a minivan. The VW Touareg (3,900 sales) may have problems because no one can pronounce the name, or perhaps the price is too high for a VW at $40,000 to $44,000. The BMW X6 (4,200 sales) may have a problem because no one is quite sure what it is (it’s a coupe-like sport utility, I think).
Slicing the automotive pie too thin leaves us hungry and looking for new markets. The statistics are littered with such borderline cases. Perhaps automakers would waste less money by sticking with their strengths and pushing to understand customers before conquering new niche territory. — Kate McLeod, Motor Matters
Copyright, Motor Matters, 2010