SUVs, large or small, are here to stay, despite rising fuel prices. AutoPacific recently asked over 300 current SUV owners how high fuel prices would affect their next vehicle purchase decision. The survey, issued bi-monthly to AutoPacific’s proprietary panel of respondents, is designed to gauge consumer reactions to fuel prices over time. Findings reveal that current high, or higher, fuel prices would cause the majority of current SUV owners (45%) to consider a hybrid or plug-in hybrid (PHEV) SUV or Crossover, while 27% would consider an EV SUV or Crossover, and 29% would be unaffected. “Most new traditional gasoline SUVs get much better fuel economy now than they did when fuel prices spiked in 2008 and caused a shift in the market,” says AutoPacific President and Chief Analyst, Ed Kim. “Couple that with an influx of hybrid, PHEV and EV SUV offerings and consumers have so many choices that they don’t have to downsize or change vehicle types.”
Current SUV owners would prefer to consider an alternative powertrain SUV or crossover than downsize or change vehicle types.
Alternative Powertrain SUV Market Share Growing at a Higher Rate than Overall SUV Market Share
According to AutoPacific’s annual forecast of U.S. light vehicle sales, SUVs will continue to dominate the market, reaching over 60% market share in 2027. Additionally, AutoPacific’s most recently issued forecast shows SUVs will make up over half of alternative powertrain market share in 2023 and beyond, and alternative powertrain SUVs will account for over a quarter of the total market by the end of 2027. “While SUVs continue to take over the new vehicle marketplace, alternative powertrain SUVs will continue to make up more of those SUV sales,” says Kim. In 2021, alternative powertrain SUVs made up 16.4% of total SUVs sold in the U.S. By 2027, AutoPacific expects they will make up 42.6% of all SUVs sold, giving SUV shoppers many options from which to choose.
Alternative powertrain SUV share of the overall market is growing at a faster rate than overall SUV market share.
Latest AutoPacific Forecast Shows a Gloomy 2022, But Share of Higher Priced Segments Grows
Due to continuing supply chain issues that remain a major impediment to industry sales recovery, AutoPacific is expecting an underwhelming 2022 with total U.S. light vehicle volumes at about 15.5 million units. Consumers can expect continued low inventories at dealerships and dealer markups resulting in higher transaction prices, and rising interest rates will have further negative impact on their purchasing power. “As transaction prices rise, people who are acquiring new vehicles during this time are likely to be more affluent, so market share of higher priced segments, such as Luxury SUVs and Pickups, is forecast to grow this year even as supply remains constrained,” says Kim.