Six years after the financial crisis, Sports Utility Vehicles are back, now comprising an all-time high 34% of the U.S. auto industry.
Sales of SUV’s plummeted in 2007 and 2008 with the onset of the financial crisis. Their reputation as gas guzzling behemoths that suffer from safety issues has improved, as new technologies have made them safer and more fuel efficient. Lower prices at the pump help as well.
According to Joe Hinrichs, Ford president of The Americas, sales of SUV’s could reach as high as 40% by 2020. Hinrichs says, “Baby boomers are aging, and they like the ingress-egress, the ease of getting in and out of the SUV and the space and utility that comes with it.” He adds, “Millennials are now buying small utilities at a rate of two to one over small cars, so they like the versatility.”
Despite the lowest gas prices in years, consumers are still concerned about fuel efficiency. Ford expects SUV sales to remain high even if gas prices increase, as new smart technologies are being deployed to address efficiency. “We have ‘start-stop’ now with our EcoBoost engine, so the vehicle will automatically stop when you go to a stop sign or a stop light to save fuel and save emissions,” Hinrichs says.
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Automakers are also embracing trends that incorporate emerging technologies, from full smartphone integration, to the digital dashboard developed by Audi and NVIDIA, to Hyundai’s teen drive monitoring software, to driverless cars.
Ford is investing in technology for its Escape SUV that connects vehicles with smart phones. Its SYNC system allows drivers to engage the car directly from a phone app. Hinrichs says, “[You can] use your app on your phone to start the car, locate it, unlock it or lock it, get your fuel level etc.…that's going to be a great adventure for everybody.”
