The Fall of the Minivan

Back in the 1980s, Dodge released a new kind of vehicle that would alter the entire landscape of the auto industry for decades to come. They created the minivan. This car shot up in popularity among the “soccer mom” demographic, mothers who were constantly driving the kids around. The minivan offered comfort, impressive storage capacity, and up to 8 seats in some larger models. However, in recent years, this segment of the auto industry is shrinking. Sales have fallen and the demand is down. Some of this shrinkage is due to the meteoric rise in popularity of the SUV and similar crossovers, but perhaps more crucial to the decline of the minivan is the stigma it made itself. Motorists no longer want to be associated with the minivan. It is disdained and frowned upon by much of society. Oftentimes, you can hear consumers of the product only purchasing it out of necessity. Their family was growing and they needed a bigger car. No one really wants the minivan anymore. In 2013, minivan sales fell 4% to about 532,000 units.

Automakers have noticed this shift in trend, and have adjusted accordingly. Fiat Chrysler just offed their last Dodge minivan, the Grand Caravan. For the time Chrysler is still manufacturing the Town and Country, but with shifts in current trends, that could soon be gone as well.

Chrysler Town & Country: The Last American Minivan

Chrysler Town & Country: The Last American Minivan

Foreign manufacturers seem to be the only players still competing in this segment of the industry. Besides the Town and Country, the only minivans left come from Honda, Toyota, Nissan, Kia, and Mazda. Sales with these models are falling as well, and with gas prices on the rise, we may soon see these sales lost to the more fuel efficient crossovers.

So what is killing the minivan? Is it the more stylish SUVs, or the more fuel efficient crossover? While that question is up for debate, a more important question to the industry is how to save the industry. Minivans make more money per unit than small cars, so it would be very beneficial to keep these models in their lineup.

Chrysler believes a more fuel efficient model is the answer to its problems. The company is looking to release a hybrid version of the Town and Country, which is expected to attain around 75 miles per gallon. Chrysler also cites shifting demographics to future success of its minivan. The millennials are now starting families, and it appears that usage of these vehicles may receive a boost as their families grow.

Whether or not Chrysler will see a resurgence in its minivan sales only time will tell, but what we do know is that something needs to change, otherwise we may have seen the last of the minivan.

– Zac Durkin

Source: http://www.cnbc.com/id/101655984

5 comments to The Fall of the Minivan

  • mayolj16

    I do not think that the changes in demographics are as positive as they expect. Most developed countries are starting to slow down their population growth by having smaller families. This factor will definitely affect the minivan market negatively as it keeps shrinking. While selling a minivan gives higher profits than small cars, small cars sell more, so there might be a point where most car manufacturers will give up on the production of minivans and focus on selling more small cars, SUVs, or crossovers.

  • Peter Wittwer

    I think it’s important to look at the cultural stigmas surrounding the minivan as a possible reason for the decline in sales. Gender roles have changed dramatically from the 1980’s when minivans were extremely popular. Women no longer want to be associated with the stigma of a “soccer mom,” as women continue to take strides and drift away from the image of a stay at home mom, they have abandoned the mini van.

  • Kade Kenlon

    The solution to the social stigma problem may be to change the style of the car to where it is almost not considered a minivan any more. Perhaps altering the doors or creating less curvy car would do the trick. This way consumers won’t shy away from it because of the vibe it gives off, and it will still make the OEM’s money.

    Also, if this decline in minivan sales continues, it could greatly affect the suppliers like Brose who are looking to improve certain aspects of the minivan, including kick to open side doors.

  • Durkin touches upon many issues, but style is certainly one. SUVs potentially offer even more space than a minivan; they add the perception that they can double as work vehicles in a way that a minivan does not [never mind whether most owners never actually take advantage of that potential]. Crossovers provide the upright driving position and ease of entry/exit for older individuals with greater panache and a smaller footprint.
     
    So a quick summary: what we see is a standard story of product differentiation, in which elaborations on an initial idea segment the market. Yes, the original minivan concept has not lost all traction, even if the 4WD Subaru Outback has gained some.

  • Jier Qiu

    You also have to take a look at aesthetic elements. Crossovers are considered way better looking/sportier than most minivans. Crossover does not have sliding doors, which can be instantly identified as a family car, while crossovers look like SUVs.

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