For Sales, Size Matters

Gas prices are steadily marching upward. A slow economic recovery pressures Americans to spend less. Automakers are selling top-shelf compact cars they once reserved for Europe. All of these factors should be hastening the long-predicted shift to compact cars. Yet today, Americans love mid-size vehicles as much as ever.

The compact segment did grow in 2012, gaining 0.8 point in market share, according to data from IHS Automotive. But mid-size cars gained 1.2 points, more than preserving the segment’s status as America’s most popular. And the larger vehicles should only pile on gains in the near future.

“The segment to watch this year is really going to be mid-size because of the new products that are getting their legs under them,” says Ford sales analyst Erich Merkle.

A flurry of redesigned models, including the Honda Accord, Nissan Altima, and Ford Fusion, has a lot to do with the blip in mid-size car sales, but there are also fundamental challenges facing compacts. The biggest may be that they don’t deliver a huge payoff at the gas pump. Data compiled by the EPA through 2011 reveals that compact cars average only 0.2 mpg better in the combined cycle than mid-size cars (27.4 mpg versus 27.2).

Don’t count out compacts, however. Automakers are more than willing to invest in compacts because, globally, they sell more of them and thus reap much greater economies of scale than with mid-size cars. And Merkle expects that Americans, namely empty-nest baby boomers and single millennials, will ultimately downsize to these better-than-ever compacts, even if they cling to bigger cars for a few more years.

“The small-car segment is still going to be very large because of the demographics that are supporting it,” says Merkle.

The carbon revolution
Lighter, better-performing wheels for the price of a Honda Fit.

Question: What could be better than driving a Porsche 911 GT3 at Willow Springs International Raceway, which justifiably bills itself as “The Fastest Road in the West”?
answer: Driving a GT3 fitted with super-rare, crazy-lightweight wheels fabricated of carbon fiber.

Built by Australian start-up Carbon Revolution, the CR-9 is the world’s first commercially available one-piece carbon-fiber automotive wheel. The black cross-thatch weave on the front face of the nine-spoke rim is the most visible selling point. But the real benefit of the CR-9 is that it weighs roughly half as much as a comparably sized aluminum wheel, which translates into better handling.

Back-to-back drives in the GT3 with stock and carbon-fiber rims confirmed that the CR-9s enhance steering feel, sharpen turn-in, and generally feel crisper. Decreased mass should also improve acceleration and fuel economy. Down the road, engineering director and company cofounder Brett Gass says the structural strength of carbon fiber will allow the development of designs that are more aerodynamic and more dramatic.

Gass and his colleagues began working on prototypes nearly a decade ago. Creating a one-piece carbon-fiber wheel was an enormous technical challenge, but the biggest obstacle was coming up with an economically viable manufacturing process.

At the moment, CR-9s retail for a hefty $15,000 per set and are available only for the GT3, the Audi R8, the Lamborghini Gallardo, and the BMW M3 and
1-series M. But Gass says higher-volume production eventually will bring down prices to the point that they’re “competitive with aluminum wheels.”