Sedans could make a comeback


Nearly half of new car sales in February 2020 were SUVs, a sign of Australia’s preference for high riding. Passenger vehicles trailed behind, with just over a quarter of sales. Even so, there are a few signs sedans will make a comeback.

Sedans are still a symbol of success and luxury and the next generation of car buyers might even prefer them.

Why sedans?

The word “sedan” is an old word which, in the 17th century, meant “covered chair on poles”. We adopted its more familiar meaning, “closed automobile seating for four or more” in 1912.

The humble family sedan used to be as much a part of Australian culture as a house in the suburbs and road trips in summer. It was the same in the US not so long ago. In 2012, one of every five cars bought was a midsize sedan; in 2019, it was barely one in 10.

When did this change? For the first time in 2018, Federal Chamber of Automotive Industries (FCAI) reported more sales of SUVs than passenger vehicles in Australia.

Of our top-10 models bought in February 2020, not one was a full-size sedan. There were four SUVs, two utes and four passenger cars. The first sedan on the list, Toyota Corolla, came only fourth. However, sales of these top 10 sedans were higher in February 2020 than in February 2019, while both top 10 utes and two SUVs lost sales over the year.

What about used cars?

While Australians bought 8 million new cars in the past 7 years, they bought many more second hand. There is very little information about the used car market, but Manheim Auctions estimates around 3 million cars each year. Gumtree compiles used car statistics based on its sales platform and says two thirds of visitors plan to buy a used car in the next 12 months.

The pattern is similar but not the same as for new cars. People say they are most likely to buy a 4WD/SUV (42%), ute (19%), small sedan (17%) or medium sedan (17%). That means one third (compared to a quarter for new cars) say they are planning to buy a second hand sedan.

What others are doing

People in the US still bought 4.5 million sedans last year. That may be less than the old days, but that is still a lot of sedan drivers. One report suggests 42% of sedan owners, in this case Focus and Cruze owners, switched to another brand rather than buy the crossover or SUV versions. They chose Honda Civics or Toyota Corollas instead.

British and European drivers have always been fans of smaller cars. Half of Britain’s top 10 are small cars, including the number one Fiesta. Most of the top 20 across 27 European countries are also small cars.

Australians have obviously had different tastes in cars – and different conditions for driving them.

Sexy and successful

As often happens in marketing, automakers want to change the “vanilla” profile of sedans and make them “sexy” or “successful” again. Mike Simcoe, GM design boss, says the industry will inevitably cycle back to sedans as long as they are stylish and ones “their neighbours admire”:

  • Genesis launched in Australia with two luxury sedans, the G70 and G80, which sell via concierge-style service and one flagship studio in Sydney
  • Hyundai’s new 2020 Sonata sedan was described as a highlight at New York’s auto show with “swoopy styling and dramatic exterior lighting”
  • Volvo’s first US factory will sell the S60 sedan to countries like China, Russia and South America, where sedans are a symbol of success.

Tattoo of the future

At the same time, the next generation of buyers is younger and needs more affordable sedans and hatchbacks. Some want cars with a smaller environmental footprint too. Others, according to Nissan, do not want to buy vehicles that look like the ones their parents drive. 

Nissan claims 80% of millennials prefer sedans and the sedan is the “tattoo of the future”:

  • 75% of all drivers who do not own a sedan would consider buying one now or in the future
  • 80% of millennials who do not own a sedan would consider buying one now or in the future
  • 68% of Generation Z would consider a sedan as their next car.

Meanwhile, in Australia, it will be interesting to see whether FCAI figures during 2020 do reflect any increase in sales of new sedans. Given the current, difficult environment for any kind of car sales, there may be little change in the mix for a while.

Corrina Baird

Writer and expert

Corrina used to lend her car to her kids and discovered first hand what Ls, Ps and demerits mean for greenslips. After 20 years of writing and research in financial services, she’s an expert in the NSW CTP scheme. Read more about Corrina

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