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Midsize Vans May Be Making a Small Comeback

9/19/2012
A little history: The Volkswagen Microbus was a compact van or family camper-mover that was introduced in the 1950s and was particularly popular as a "hippie van" in the United States during the 1960s. It was a forerunner of the modern passenger van. In the 1980s through 1990s, the compact van became the minivan and later the midsize van that was produced by Detroit-based automakers and Japan's major manufacturers. This was the era of the ultra-popular Dodge Caravan and Ford Aerostar vans. During the first decade of 2000, many consumers opted for sporty, trendier truck-based utilities and car-based crossovers (CUVs). As a result, minivan sales started to decline.

Midsize vans now may be making a slow comeback, partly due to convenience features--such as power sliding doors, comfortable seating and entertainment systems for passengers--in addition to better fuel economy for a 7-passenger vehicle, higher safety ratings, and sleeker styling cues.

In addition, pricing is in a family budget ballpark, with a retail price range beginning around $21,000 for several models to more than $40,000 for a full-featured, high-end model from several brands. During the past 3 months (June-August 2012), the average buyer-facing transaction price for a midsize van was $28,725, which was $915 lower than the average price in the same 3 months of 2011, according to J.D. Power's Power Information Network(R) (PIN) real-time retail transaction data and analysis.

PIN data also indicates that a larger percentage of midsize van owners this year traded in their current model for a new midsize van, compared with a year ago. In fact, during the past 3 months, more than one-third of midsize van owners traded for another midsize van--up 4.6 percentage points from a year ago.

During the past month and through the first 8 months of 2012, Fiat-Chrysler Group's two midsize vans accounted for nearly 46% of the segment's total (retail and fleet) sales--up 2 percentage points from last year's 44% share. The Dodge Grand Caravan was the best-selling midsize van, followed by the Honda Odyssey, Toyota Sienna and Chrysler Town & Country. Nissan's third-generation redesigned Quest also made significant inroads this year--total sales nearly doubled to 13,324 units vs. 7,800 a year ago.

In August, midsize van sales outpaced the industry. The segment's 22.5% total sales year-over-year improvement in August surpassed a 15.5% industry increase from August 2011.* Nearly 55,000 midsize vans were sold in August--up from 43,201 a year ago. Midsize van sales accounted for a 4.28% share of the market in August--which was one of the highest monthly midsize van shares in the past 2 years.

Midsize van sales, in fact, have done well most of the year. Year-to-date midsize van sales are up by nearly one-fifth (+19.6%) to nearly 375,500 units from a year ago. Through the first 8 months of 2012, the eight brands that sell minivans in the U.S. market delivered 63,000 units--more of them than in the prior year--which is equal to well over one average month's total sales of midsize vans.

Year-to-date market share (based on total sales) edged up slightly to 3.87% from 3.70% a year ago, but midsize vans are still below earlier peak years. As recently as 2007, midsize vans represented 5.3% share of the market. At the dawn of the sport utility vehicle (SUV) craze in 1995, midsize vans captured 8.5% of total industry sales, a figure comparable to today's midsize CUV share, suggests Tyson Jominy, director, consulting and analytics, Power Information Network(R) (PIN). There are fewer brands offering models in the segment today, but as this year's sales increase illustrates, there is still consumer demand for these efficient, convenient family vehicles.

*There were 27 selling days in August 2012 vs. 26 in August 2011.

Note: All sales figures and percentages of change are based on retail and fleet deliveries.

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