SUVs on road to nowhere

They sit on the front lawns of rural North America in increasing numbers, “For Sale” signs slapped on their windows like badges of shame.

It has come to this for the once-mighty sport-utility vehicle. Some auto dealers are refusing to take them as trade-ins. Those that do value them at a fraction of their previous worth. Gasoline at US$4 a gallon has turned the family hauler of choice only a decade ago into the unwanted animal of the motoring market.


When automakers report sales numbers for May today, the 26% decline in U. S. sales of SUVs in the first four months of this year is expected to turn into a deep dive. But the obit for the full-sized SUV is still premature, says Tom Libby, senior director of industry analysis at J. D. Power & Associates.

“Used vehicle prices of large utilities and large pickups have dropped dramatically,” Mr. Libby acknowledged. “But remember, we’ve gone through this before. I remember after Hurricane Katrina, I must have gotten at least 15 calls asking me if it was the death of the SUV. We’re not there yet.”

Financial Post