COMMENT: The new small car axiom – less is more?
Prospects for small cars have perhaps never been better. As the share of the global car market accounted for by emerging markets rises, so the share of small cars in the total will rise, too. Long-run trends in energy costs would also suggest that small or compact cars – broadly defined - have a bright future in mature car markets.
Reducing vehicle mass while still offering a compelling product to the customer – in a small car package - is becoming the great design challenge of our times. Less may well be more, the theory goes, and maybe the customer will even pay enough to permit the OEM to turn a profit in a segment of the market where margins have traditionally been wafer thin.
It is certainly interesting to see how manufacturers are increasingly looking to add value to small cars (especially in their design; think Chevrolet Spark, Ford Fiesta) – as well as work hard on industrial strategies that can keep manufacturing cost down.
Last week Opel/Vauxhall confirmed that it will make a new sub-Corsa small car at the Eisenach plant in eastern Germany. On the cost side, that plant is relatively modern and has a low-cost structure (not as low as it was when the plant was set up in the 1990s after German reunification, but still pretty low). Sharing the Gamma 2's flexible platform (or 'vehicle engineering architecture') is a big under-the-skin cost saver and also gives Opel control over vehicle design.
But Opel is not only concerned with cost. It wants this car to be innovative and to offer a design that is attractive rather than simply utilitarian. The approach is very different from that which spawned the Agila model based on a cheap Suzuki. Opel now wants a small car that is a little more refined than the Agila and one that is supportive of the brand values that it wants to develop going forward.
And given the growing importance of the small car segment, a small car can't be an afterthought or a cheap compromise any longer.