In an overall market down 18%, subcompact cars are quickly losing share in the US, with a 25% decline in sales in the first three quarters of 2020. However, the segment has shown some signs of life in Q3 with sales down just 15%, which is a significant improvement of the -52% in the first half. Still, the segment has gone from a 2.5% share of the US car market last year to just 1.5% now. Low fuel prices and the ever-increasing popularity of crossovers are of course the main factors for this decline, but also a lack of new product. Honda and Toyota have both revealed their plans to exit the segment this year, following Ford.
Just one nameplate manages to sell more in 2020 than in the first nine months of 2019 and only one other nameplate is down by a single digit. The Kia Soul consolidates its segment leadership despite losing 29% of its sales, as its nearest rival Nissan Versa is down by 47%, due to a model changeover to the new generation which coincides with Nissan’s commitment to reduce fleet sales to rental companies, for which the Versa was a staple product. Versa sales were up 24% in Q3 as it suffered a very weak quarter last year. The Honda Fit took second place in Q3 by a small margin as it too was up, albeit by just 4%. This is despite the lack of a new generation which is already on the roads in Japan and Europe. The new version won’t come to the US as Honda will stop sales of the Fit this year. The Kia Rio, down by just 6%, moves past its platform sibling Hyundai Accent who is one of the big losers in this segment with sales down 38%. The Chevrolet Sonic outperforms the segment with a 2% gain year-to-date thanks to doubling its sales in the third quarter when it outsold the Accent. The Ford Fiesta and Fiat 500L sold fewer than 140 units each in Q3 are are all but dead. Surprisingly, Toyota is one of the weakest players in this segment with the Yaris. The brand foolishly thought a hatchback version could reverse its fate, but Americans just don’t have an appetite for hatchbacks, unless it’s marketed as a crossover. Toyota will pull out of the subcompact car segment altogether, meaning the Corolla will be the cheapest Toyota for sale in the US as of next year.
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