Canadians now buying SUVs as often as passenger cars

The new Fit-based 2016 Honda HR-V is a considered an SUV/crossover but sits nearly as low as a car (Mitch Ward/Autofocus)

The Canadian auto industry’s march towards record new vehicle sales volume is currently being propelled in large part by a migration away from traditional passenger cars toward SUVs and crossovers.

While the trend has been perceivable for the last few years, as mainstream cars like the Honda Accord gradually declined and crossovers like the Honda CR-V ascended, recent results show that it’s no longer just a gradual move away from cars toward utilities.

No, we have reached a point where there may now actually be parity between the two segments.

In August 2015, Canadians bought and leased just as many new SUVs and crossovers as cars, with the passenger car sector tumbling nine per cent, year-over-year, and SUVs/CUVs jumping 18 per cent.

Related: Canada's 25 fastest-growing passenger cars

Now, those figures aren’t written in stone. Arguments over what constitutes an SUV, or for that matter, a crossover, continue unabated. A new breed of low-slung, “subcompact crossovers” blurs the lines even further. Mazda’s CX-3, for example, offers no real ground clearance advantage over a typical car and is hardly taller. But Mazda markets the CX-3 as a subcompact SUV. The CX-3 joins vehicles like the Honda HR-V, Chevrolet Trax, Mini Countryman, and Nissan Juke on the “SUV” side of the ledger. Toyota 4Runners they are not.

At the other end of the spectrum, traditional, truck-based, body-on-frame, four-wheel-drive sport-utility vehicles are few and far between. Full-size SUVs based on high-selling pickup truck platforms, vehicles like the Silverado-based Chevrolet Suburban, account for less than two per cent of the SUV/crossover market.

In other words, the bulk of the SUV sector’s sales are produced by vehicles which look like SUVs but are really just all-wheel-drive or front-wheel-drive hatchbacks on stilts. Does this matter to the typical buyer? Not in the least.

Even assuming a more narrowly-defined SUV/crossover category in August still results in a scant difference in total sales in favour of cars last month: no more than 500 units. But if we include the Subaru Outback and XV Crosstrek, Toyota Venza, Volvo XC70, and Honda Crosstour in the SUV/CUV arena, then utility vehicle market share jumped to 38.4 per cent in Canada in August 2015, significantly better than the 36.5 per cent managed by passenger cars.

It certainly helps that much of the new product introduced over the last year has benefited the SUV/crossover category. Why would automakers have it any other way? These are clearly the vehicles in which consumers are interested. In August 2015, of the 15 new vehicles on sale in Canada which weren’t on sale in August 2014, seven were SUV/CUVs; five were cars. Those seven utility vehicles added 4,034 sales to the industry’s monthly sales volume while the five cars added just 587 sales.

Indeed, the Honda HR-V and Mazda CX-3, though only on the market for a few months, have already taken up positions among the top-selling SUVs and crossovers in the country. In August, the CX-3 ranked 21st among utilities; the Fit-based HR-V ranked 13th among utilities and outsold all but ten different car nameplates.

The Lexus NX meanwhile arrived in Canada at the end of 2014 and has already asserted itself as one of the country’s leading premium brand utility vehicles. In August, the NX outsold all but six luxury vehicles.

In addition to helpful new product introductions, the majority of established SUV/CUV nameplates are also flying high. Canadian sales of the Toyota RAV4, Honda CR-V, Nissan Rogue, and Jeep Cherokee have grown by 17,652 units, or 22%, through the first eight months of 2015. Meanwhile, year-over-year, every one of Canada’s seven best-selling cars is selling less often this year than last.

Now, statistics can be carved to suggest one thing or another. Position certain vehicles on the right side of the ledger, for instance, and it’s easy to say that cars still hold the edge. But even a significant advantage for the car sector in August wouldn’t change the fact that the market is rapidly transitioning. Just one year ago, cars produced 42 per cent of Canadian auto sales and SUVs and crossovers only 32 per cent.

The shift does not mean all passenger cars have suddenly become low-volume, low-profit vehicles for automakers. Although they build North America’s best-selling SUV, the CR-V, recently launched an all-new Pilot, and delved into a new SUV category with the HR-V, Honda is still attacking the car market. At the introduction of the new, tenth-generation Civic, American Honda’s executive vice president, John Mendel, said, “We’re not as pessimistic as others about the outlook for the car business.”

Indeed, the degree to which the shift will continue is unknown. But no industry insider, analyst, or observer sees any point in denying the existence of the trend. In Canada, car sales fall every month while SUV sales rise every month. We’ve yet to see any indication that these outcomes will change in the near future.