Minivan segment now seeing lower sales but higher profit margins

Article by Christian A., on June 3, 2014

Recent sales figures of minivans pale in comparison with the numbers a decade ago. But despite that, carmakers and dealers are earning more from them – because in-demand higher-end minivans do deliver good margins. Brian Heney, director of operations for the Kelly Automotive Group, remarked to Automotive News that unlike before, customers are now just choosing between just two shopping options.

He noted that minivan customers now know what they are looking for and “they pay for it.” Kelly Automotive Group sells Chrysler Town & Country, Honda Odyssey and Nissan Quest. He remarked that loaded up minivans do appeal a lot to customers.

The good margin from selling minivans may have prompted carmakers to quietly get ready for battle for customers. For one, Chrysler unveiled in May that it plans to consolidate its segment-leading minivan offerings under the Chrysler brand while dropping the Dodge Grand Caravan.

The move is expected to make customers purchase more premium minivans under the Chrysler brand, which entry level product is over $10,000 pricier than a similar offering by Dodge version that carries a base price of $21,590, including shipping.

Chrysler is also planning to roll out a plug-in hybrid version of the Town & Country in 2016. Ford, which has left the minivan market eight years ago, is looking to re-enter the segment through its Transit Connect Wagon, which looks, operates and feels like a minivan, although the carmaker is marketing it as an "unminivan."

Kia Motors America, meanwhile, unveiled at the 2014 New York auto show a stylish Sedona minivan, which will be available this fall. Kia, however, refers to the Sedona as a multipurpose vehicle. [source: automotive news - sub. required]

If you liked the article, share on:

Comments

Recommended

McLaren has already shown some interest in electrifying their models. And initially, we thought that they will just use hybrid systems to use across their current lineup. Nevertheless, we have...
by - August 19, 2017
Fifty years after its glorious victory at the 24 Hours of Le Mans, Ford launches the 2018 Ford GT ’67 Heritage Edition at the 2017 Monterey Car Week. The red...
by - August 18, 2017
Hyundai has recently unveiled an unnamed pre-production model of its new fuel cell SUV. We don’t know what to call this model just yet, but sources say that this model...
by - August 18, 2017
This weekend at the 2017 Pebble Beach Concours d’Elegance, the BMW Z4 Concept will make its first public appearance. The good news is that we will finally have a real...
by - August 18, 2017
While Honda’s new 2018 HR-V will be rolling out at the dealerships with just a few updates, the company is certainly not giving up its spot as the best-selling vehicle...
by - August 18, 2017
Facebook

Youtube Channel

Tip Us
Do you have a tip for us?
Did you film an important event?
Contact us
Newsletter
Subscribe to our newsletter!
Subscribe
Galleries