The composition of the auto market has changed dramatically in recent years. Vehicles have become much more expensive — partly because they’re increasingly tech-heavy — but also because they’re getting larger.
In fact, when we talk about shopping for a new “car” in 2024, that often actually means shopping for an SUV or a truck — technically not cars at all.
Most passenger vehicles are classified as either cars or light trucks, and SUVS and minivans fall into the latter category.
New data from car-shopping site Edmunds finds that traditional cars account for a mere 19% of the overall new vehicle market — a record low — while SUV market share is at an all-time high (58%). For context, traditional cars made up 47% of the new vehicle market a decade ago.
CNN reports that the major American auto manufacturers have “virtually abandoned the sedan market.” Ford’s only “traditional” car is the Mustang, for instance, while Chevrolet is down to zero after discontinuing the Malibu in November.
The burgeoning SUV market, meanwhile, continues to grow more crowded. According to Kelley Blue Book (KBB), Americans can choose between more than six dozen SUV models on the market.
Automakers like selling SUVs because they’re more profitable than traditional cars, according to Pat Ryan, CEO of the car-shopping app CoPilot. When manufacturers struggled with supply-chain issues during the pandemic, they prioritized these moneymaking vehicles.
“Americans love big SUVs, and those have long been the most profitable,” Ryan says. “So certainly, building those when you had shortages during COVID-19 was a natural incentive for manufacturers.”
They’re also what Americans increasingly prefer, he says. Car shoppers today want more height, cargo space and legroom, and are willing to compromise on mileage, price and handling for the extra space.
Ryan attributes much of the rising popularity of SUVs to the fast-growing popularity of “crossover” models, which are small SUVs built on more compact car chassis. They have more space than a sedan but handle more like a car than a large SUV built on a truck frame. “Cars have really been replaced by the crossover,” he says. “That’s really what’s happened.”
Another key factor in the shift from traditional automobiles to SUVs: American manufacturers used to produce passenger cars in part to reduce the average fuel economy of their fleets and satisfy government requirements. Now, they’re doing that with hybrids and electric vehicles instead, Ryan says.
As cars have fallen out of fashion, the popularity of pickup trucks has remained more or less flat, with market share hovering between 18% and 20% over the past five years. As a result, the largest vehicles — SUVs and trucks — now represent the vast majority of the new vehicle market.
In short, bigger is better in the mind of the American consumer. “Americans are bigger people: They like bigger homes and they like bigger cars. It is part of the psychology of our country,” Ryan says.
Research suggests, though that we have a tendency to buy larger trucks than we really need. For example, over 60% of people who own Ford’s full-size F-150 pickup truck rarely or never use their trucks for towing and only 28% of owners frequently use their vehicles for hauling bulky or heavy items.
The trend of super-sizing our cars is a big reason why new vehicles have become so expensive. Full-size SUVs typically cost over $70,000. Pickup trucks cost an average of nearly $60,000.
Overall, the average price for a new vehicle ($47,337) is up 71% since 2004, according to Edmunds. But truck prices are up 106% in that time. Meanwhile, average passenger car prices have increased 54%, rising to $37,767.
If you’re just buying a vehicle to get to work and shop for groceries, you may be better off with a smaller, more affordable vehicle than a full-size truck or SUV. Despite the decline in the number of cars on the market, there are still plenty out there, particularly from non-American manufacturers. Honda and Toyota are the leading manufacturers of sedans and compact cars with models like the Accord and Camry, respectively. Other foreign auto brands like Hyundai, Kia and Nissan also produce relatively affordable options in this segment.
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