You may be just as skeptical about an article touting a station wagon trend as you are about the commercial that announces a shredded-wheat trend. But 1998 could be known as “the year that marked the return of the station wagon.” Honest.
European automakers in particular, from Audi to Volkswagen, are introducing more station wagons into their U.S. model lines, betting that Baby Boomers and Generation Xers will be drawn to wagons that range in price from $13,000 to more than $40,000.
These station wagons are unlike anything Americans have known. They are “cool,” offering driving performance, sedan-like handling, sophisticated styling and all-wheel-drive, the feature that makes sport-utility vehicles so popular.
These automakers could have a good reason for their optimistic view. Some auto-industry analysts are predicting a slowdown in the movement to sport-utilities. The sport-utility market is moving into a mature stage, according to a 1997 J.D. Power and Associates report. Though sales are expected to grow 25 percent between 1996 and 2002, that is a major slowdown after five years when sales more than doubled.
Also, some Nextrend data indicate that disenchantment with sport-utilities is beginning to surface, said Wesley Brown, an auto industry analyst with the consulting firm in Thousand Oaks, Calif.
Specifically, research shows the percentage of people trading in cars for sport-utility vehicles has shrunk. In 1994, 44 percent of car buyers shifted into sport-utilities; in 1997 it was 34 percent.
Data also show a slight movement of sport-ute owners back into cars as Baby Boomers become empty-nesters and also as they find it more difficult to climb up into those command seating positions.
“It’s very slight right now, and we’re expecting that to increase,” Brown said, citing Audi as an example. “Our data showed that around 20 percent of Audi’s A6 (Avant wagon) buyers last year were trading in SUVs. In that vehicle you have Quattro (all-wheel-drive) and you have a wagon.”
“I think some manufacturers are looking at this trend and recognizing that if there’s a movement back into cars, some will potentially need the utility and size of an SUV but don’t want an SUV.”
In this climate, these automakers–most of them without a sport-utility–are ready with what they say are the next best thing. Since these station wagons are essentially the same vehicles that they sell in Europe, it is easier and less expensive to incorporate them into their U.S. lines than to develop a sport-utility vehicle.
Audi executives think there is as much potential for wagon sales in the U.S. as in Europe, where Avant wagons made up 35 percent of A4 models sold and 45 percent of all A6 models sold in 1996.
George Neill, BMW 5-Series product advocate, says its research shows that luxury-brand owners who have bought a sport-utility tend to be the least satisfied, and it plans to target them.
“We see it as a niche. It allows people to make a unique image statement in their neighborhoods, which may be flooded with SUVs.”
For 1998-’99:
– Audi has brought its compact A4 Avant wagon as well as its new A6 Avant to the U.S. and both are available with Quattro.
– BMW’s new 5-series Touring, launched in Europe, is likely to come to the U.S. this fall with all-season traction control. And it is possible that a wagon version of the smaller 3-Series sold in Europe could come to the U.S. in the next few years.
– The 1998 E320 Mercedes-Benz wagon offers an optional new all-wheel-drive system.
– Saab will debut a wagon version of its new 9-5 sedan early in 1999 but without all-wheel drive.
– In addition to its Outback and Outback Limited wagons, Subaru has three other wagons.
– Last August, Suzuki, which pioneered the small sport-utility segment, introduced a wagon version of its two-year-old Esteem.
– Volkswagen is offering its 1998 Passat wagon in the U.S. as part of its redesigned mid-range series launched last fall in the U.S. This 4-cylinder Passat wagon is front-wheel-drive. When Volkswagen introduces the V-6 version late this year, it will be available with all-wheel-drive.
– Volvo began offering three all-wheel-drive station wagons, including its Cross Country model (a luxury-type Outback), in its V70 series for the 1998 model year.
“We’re seeing a transformation of station wagons from being life-stage vehicles–primarily geared to family-rearing years–to lifestyle vehicles, which are appropriate for many activities outside of family rearing,” said Susan Jacobs, president of Jacobs & Associates, an automotive consulting firm in Rutherford, N.J.
They are being reconceived for a new target audience in response to demographic trends, she said. Traditional wagons have been purchased by 25- to 44-year-olds in early family-rearing years. That group is starting to shrink.
“I think one reason we saw such fantastic success for the Subaru Outback was that the Outback trim transformed the Legacy wagon from a functional family vehicle into a lifestyle vehicle,” Jacobs said. “Also, one of the attributes people go for in sport-utilities is the all-wheel-drive capability, and that’s one of the reasons we’re seeing more wagons promoting it.’
Brown also thinks Subaru has done a good job of making a wagon cool and others, including Volvo and Audi, are playing off that.
“Coolness and trendiness are a big factor in the SUV phenomenon,” he said. “If you can capture some of that coolness, then you stand a very good chance of seeing (station wagon) sales take off.”
It is not cool for a Generation Xer to drive a wagon, said Brown. It is more acceptable to drive an all-wheel-drive wagon. But the ultimate in coolness would be something like the Outback.
“Subaru didn’t just add all-wheel-drive. It made it higher with more ground clearance, and it played around with the body a little bit. It became cooler and then already it’s acceptable for Generation X.”
That is what Volvo did with its new Cross Country all-wheel-drive model with a beefier look and higher ground clearance. The Cross Country is partly responsible for a shift Volvo has seen from its two-wheel-drive to its all-wheel-drive wagons, whose sales increased from 35 percent in September to 58 percent in December.
Nextrend research shows that Generation X doesn’t have the same kind of love affair with sport-utility vehicles that Boomers did, said Brown, a Gen Xer.
“You could argue they are trying to carve out their own unique product preference niche and not drive what everyone else drives.”
He thinks that when Audi brings the 1.8-liter version to the U.S. this year, the new A4 Avant will appeal to Generation X, because it will probably sell for thousands less than the 2.8-liter.
Brown also thinks the all-wheel-drive version of the new Volkswagen Passat wagon should appeal to Generation Xers when it is introduced this year.
“VW in general dominates Generation X with the Golf and with the Jetta so the new Passat should do well,” he said.
And if all these wagons sell well, he points out, BMW and Mercedes-Benz have smaller wagons (the 3-Series and C-Class respectively) that they could bring into the U.S.
The absence of the Big Three is not an oversight. The Big Three are doing quite well selling trucks, these analysts say.
The really good news for consumers seeking something different is that their new station wagons are likely to remain something different. In the future they’ll be saying, “I was driving wagons before they were cool.”
