Do Large Sedans Have Big Future?

In an age when crossover SUVs and fuel-sipping small cars are all the rage, some may wonder why automakers still pursue large, relatively gas-thirsty sedans. No slowdown is in sight: Ford reportedly will debut a redesigned Taurus early next year, and Nissan took the wraps off its seventh-generation Maxima at last week’s New York auto show.

That’s in spite of the fact that the market for such cars is stalling: J.D. Power reports that large-car sales dropped 21% over the past two months. Automakers are committed to sticking it out because they say the cars represent flagships for their brands, and they’re confident the road ahead won’t be quite so rough.

Auto analyst Erich Merkle backs up that stance. Despite the ebbing popularity of cars like the Chrysler 300 and Toyota Avalon, he predicts large cars will rebound as baby boomers retire.

“They’re never going to look for their father’s vehicle,” he said, but they will go for “well-styled, large cars with all the modern amenities.” The Maxima satisfies some of those criteria: Its trunk and cabin aren’t as roomy as those in a Taurus or Avalon, but it can come stocked with things like a heated steering wheel and panoramic moonroof.

With such features, some wonder whether the Maxima encroaches on the turf of its luxury sibling, Infiniti. At the auto show, Nissan general manager Al Castignetti acknowledged the risk but said it’s all part of “getting people to move on up.”

Merkle sees the door swinging the other way: Baby boomers could move down, crossing from a higher-end Lexus to a loaded Toyota Avalon, for instance. Baby boomers "are looking for value,” he said.

“You'll see a shift more away from luxury and more toward your bread-and-butter brands,” he said.

Toyota product administrator Damien White said his company is also mindful of the risk, but that there’s still ground to claim between a midsize family car and an entry-level luxury car. Average transaction prices illustrate his point: Entry-level luxury cars like the Lexus ES run near $37,000, while midsize family cars like the Camry and Accord are around $24,000, White said. The Avalon runs $31,800 — almost exactly halfway between.

Risks notwithstanding, these cars will likely stick around because of the flagship factor. In its initial press release, Nissan affirmed the redesigned Maxima’s flagship status, and White said the Avalon is still “definitely” Toyota’s flagship — despite the automaker having a Land Cruiser SUV that costs twice as much and a Prius that’s become the icon of hybrids. Keep that in mind and you can bet that no matter which way car buyers go, automakers won’t easily leave the full-size sedan behind.

Comments

[KJ]

Today's flagships are tomorrow's land yachts found on dealerships used car parking lots. For the upcoming future I predict cars like Civics, Corollas, and the Focus will be in high demand and the flagship cars will be admired but not purchased.

[DodgeFan]

I think the small cars will reign in point to point driving. But a large car will win when someone needs to take a trip or when a person is phyiscially unablt to fit into a small car.

[sczech]

Cars don't run very well without gas. At least the majority that are being produced right now and in the near future don't. So either there is a switch in the type of powerplant, or bigger cars keep getting lighter, otherwise they won't be around.

[Jay]

Large cars (and trucks) will always be around. The Accord is just as big as a Buick Lucerne and Honda can't make enough of them. There are also a lot of consumers over 6' tall/200 lbs. that just won't go for a Fit or Versa (who came up with these names). Analysts said the muscle car era would never return after the 70's. Why is Mustang, Camaro, Corvette, and Challenger around? Automakers wouldn't do these with out a solid business case. Analysts also said the end of the small car was imminent going into the 90's. They're still here. So there is enough sales volume to justify building large cars just not at the rate "grandpa" used to buy'em...

[Dave T.]

I will say Ask.cars.com gets lots of requests about which cars feature big bench seats these days because people want that. Strange to many of us I know. Also salesmen really prefer large sedans.

[Tony]

"...Automakers wouldn't do these with out a solid business case..."

Jay, producing a car today is nothing as it was before. It is no longer a time-consuming or resource(human) consuming process it once was.
Some cars, like those muscle cars you've mentioned, produced only thanks to modern computer car-building technology. This allows manufacturers to have as you said, "solid business case". If cars were designed and made as they were 20 years ago you wouldn't see any of those new Camaros today.

[Jay]

Thanks Tony for validating my comment. That's the whole idea of solid business case "not designing/building it the same way 20 years ago". Its cheaper to make and satisfy that handful of consumers with similar platforms and parts in todays cars than the dinosaurs from the past.

[sczech]

Having a business case is the same idea mentioned above. As gas prices go up and up, if vehicles are not more efficient (sorry I forgot this point above) then they will go to the way side. And by going away that does not mean completely. There will always be someone who has enough money to afford a vehicle that gets 14 miles to the gallon. You don't need a large Buick or Honda to fit a person who is 6 or 7 feet tall. All you need is a car designed to fit a taller driver. That does not mean you need the 2 other seats and huge trunk. Size is luxury, and when money is tight, luxury will be the first thing to get cut.