Benjamin Zhang/Business Insider
The new Cadillac XT5 has been a big success.
For the past two years, the US auto market has set sales records, due largely to the popularity of SUVs and crossovers. Americans would rather own or lease these versatile vehicles than take the plunge on a new sedan.
The difference between SUVs now and SUVs before the financial crisis is that they have an additional, no-compromise selling point: higher MPGs.
“SUVs, pickups and crossovers, whose MPGs increased by over 10% between 2011 to 2016, had a 59% increase in sales,” said the Consumer Federation of America in a statement, citing a new study. “On the other hand, those same vehicles with less than a 10% increase in MPGs from 2011 to 2016 only experienced a 41% increase in sales, almost 20% less.”
According to Jack Gillis, CFA’s Public Affairs director, “This analysis completely debunks automaker claims that consumers don’t value good gas mileage.” (CFA is a nonprofit that developed out of the consumer movement of the 1960s in the US.)
Automakers have been pressing the Trump administration to roll back increasingly stringent fuel-economy standards, with the argument that consumer demands for relatively lower MPG vehicles is forcing car companies to build “compliance” cars that people don’t want to buy.
However, Gillis isn’t entirely correct when he accuses the automakers of defying consumer enthusiasm for higher MPGs.
At Business Insider, we’ve encountered this firsthand, testing out numerous SUVs and crossovers that trade off performance for fuel-economy. In one case — the new Cadillac XT5 — we were so taken aback by the lack of pep coming from the motor that we asked Caddy what the deal was.
The carmaker explained that it had developed the engine based on consumer desire for decent MPGs and made a trade-off for power. That strategy appears to be working, as Caddy is selling almost 6,000 XT5s every month.
Still, CFA’s data is compelling. A buyer takes many things into account when he or she chooses a car, and while in previous decades fuel-economy might not have been at the top of the list, as carmakers have achieved higher MPGs with new technologies, the market has begun to make that a priority.
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