U.S. consumers have recently been shying away from fuel-thirsty sport utility vehicles, an industry research firm said on Thursday, in a report on what may become a worrisome trend for Detroit's traditional Big Three automakers.
Power Information Network, an affiliate of J.D. Power and Associates, cited rising gasoline prices and a renewed emphasis on cars by some manufacturers as factors contributing to recent evidence of flagging SUV demand.
The Power Information Network report said unsold SUVS had sat on dealership lots for an average of 73 days as of last month, about 22 percent longer than the 60-day average in July last year.
The increase in the so-called "days to turn" rate was even higher for luxury SUVS, jumping 47 percent, or more than double the industrywide rate for cars and trucks overall, the report said.
Further pointing to weakness in the SUV sector, the report said average SUV transaction prices were down 2 percent, or $620, in July from the year-earlier period. Luxury SUV prices were nearly 5 percent lower, meanwhile.
Many Americans have long considered SUVs the kings of the road, making them their preferred choice of vehicle despite generally poor mileage and a high rollover risk compared to cars.
The Power Information Network suggested that huge discounts were further evidence of weakening SUV demand, however.
Consumer incentives on SUVs averaged $3,440 in July, the report said, up nearly 12 percent from June and nearly double the overall industry increase for new cars and trucks.
Tom Libby, the Power Information Network's senior director of industry analysis, told Reuters car-based sport utilities or so-called crossovers were outperforming traditional body-on-frame SUVS. But both types of vehicles were included in Thursday report.
General Motors Corp., Ford Motor Co. and DaimlerChrysler's Chrysler division all make a huge share of their automotive profits from sales of pickup trucks and truck-based sport utilities.
But Libby said it was too soon to say the automakers are in big trouble because America's long love affair with SUVs is finally on the rocks.
"It's definitely too soon to say that," Libby said.
"We would caution that, really, it's important to wait a little while before drawing any giant conclusions. You have to wait and see if indeed there is a major softening or if this is just sort of a blip."
