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Please do an analysis of the 'crossover' passenger car market in Europe and prediction for sales/trends
Hello! Thanks for your question about the crossover passenger car market in Europe. The short version is that the crossover market is booming, and expected to continue to do so despite the forecast of a general drop in European car sales in 2017-2018. The primary target segment for crossover cars is the educated Millennial market, either buying their first car or looking for a second household vehicle. A secondary target segment is customers over the age of 50. Below you will find a deep dive of my findings.
METHODOLOGY
We began our research with CarSalesBase.com, which had a pair of excellent articles detailing the growth of European small- and mid-sized crossover sales (which includes the Nissan Qashqai). This gave us the name of 30 crossover models to research. We also searched industry reports to determine the intended target segment of crossover sales and financial news outlets to analyze the expected future of the market.
SALES AND PREDICTIONS
Crossover cars (aka crossover SUVs) have taken a dominant position in the European market, accounting for "25% of all European passenger vehicle sales in 2016 — up from 21 percent the previous year." CarsSalesBase.com reports that sales of mid-sized crossover cars is up 28% in the first quarter of 2017, while small crossover sales are up 16%. (See links for breakdown of sales for 2016 Q1 vs 2017 Q1 by model.)
The two-year outlook for the European car industry in general is not optimistic. Car sales plunged in April 2017, with new car registrations in the 27 European Union countries suddenly falling by 6.6%. Forbes warned in November 2016 that there would be a fall in the European car market in 2017-2018, claiming that the rapid growth of prior years was the result of artificial stimulus which is now losing its effectiveness. Nevertheless, there is optimism for the crossover / small SUV market, which is forecast by AutoNews to continue its rapid growth.
TARGET DEMOGRAPHIC SEGMENTS
We were not able to discover any specifically European target demographic reports, but we did discover some global trends that we believe drive the European market as much as the American. The primary target segment for crossover cars is, not surprisingly, the Millennial market. "Makers of subcompact sports utility vehicles (SUVs) and crossovers are rolling out a host of new designs and benefits to draw in early drivers, mid-to-late 20-year-olds, and adults looking for a second household vehicle." Buyers over the age of 50 provide a strong secondary target segment.
The main factors driving the buying decisions of Millennials are a desire for new technology, particularly safety features and fuel-efficient engines. Though not as efficient as hybrids, new crossovers consistently provide over 30 MPG on the highway, far outstripping full-sized SUVs. Many Millennials see this as a fair trade-off in return for more comfortable seating, additional space, and greater safety, especially as they start families of their own. Even a quick search of "crossover cars" on social media such as Pinterest shows many albums collected by Millennial fans of the vehicle, evidencing their love and loyalty.
CONCLUSION
To wrap it up, crossover car sales have boomed in the European market in the last two years, and are expected to continue to grow despite a forecast downturn in the general automotive market. The primary target demographic is Millennials either buying their first vehicle or buying a second vehicle for their households and who wish to balance comfort and safety with fuel economy.
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