Toyota trounces Chrysler in test of consumer 'iQ'

At this week's New York International Auto Show, Chrysler will roll out the star of its 2011 fleet: a new, improved Jeep Grand Cherokee SUV. Although the new vehicle seems almost startlingly ill-advised, it has been described by Chrysler spokesman Rick Deneau as "one of the primary legs of the Chrysler stool."

Deneau definitely has a way with words: stool seems like a perfect term for the ailing car maker's decision. The new SUV stands in stunning contrast to Toyota's (TM) latest model, the iQ, which will also be debuting at the car show. A subcompact that gets 54 miles per gallon, the iQ is loaded with safety features and is designed for urban drivers who need to manuever into extremely tight spaces. While Toyota, like every other car maker, is experiencing dropping sales, the iQ seems destined to find a place in a market that is focused on efficiency and economy.

It's not all bad news for Chrysler. On the bright side, the new Jeep Grand Cherokee is 11 percent more fuel efficient than the current model, now getting 19-20 mpg. The compares semi-OK to the Honda (HMC) CR-V's 20 mpg city and 27 on the highway. The CRV been the #10 top-selling car in America for the last two years in a row, proving that a (relatively) fuel-efficient SUV still has a place in the market (although the CR-V did barely crack the top 10).

One of the lingering arguments made by US car makers has been that American consumers like big, beefy vehicles and as long as people continue to buy gas guzzlers, Detroit should continue to make them. There is some credence to this theory: the Ford (F) F-150 and Chevy (GM) Silverado continue to be the best-selling vehicles in America, with the Dodge Ram consistently making the top ten. However, it's worth noting that all three of these models are trucks, and many are presumably purchased for business purposes. It will be interesting to see how the declining housing market and the associated drop in home construction and contracting affects truck sales.

In the meantime, it's telling that, apart from trucks, the only American vehicle to crack the top ten in 2008 was the Chevy Impala, which held steady at number 8 on the list. The six remaining vehicles were smaller, more efficient Japanese models. While some might chalk this up to 2008's record gas prices, that wouldn't explain why 2007's top 10 was essentially the same, or the fact that 2006's additional American car, the Chevy Cobalt, was another fuel sipper.

It seems likely that there will always be a niche market that only buys American cars, just as there is a niche market that is doggedly loyal to British cars, or Italian cars, or Czech cars. Whether out of a sense of patriotism or duty or just plain stubbornness, they will consistently pony up a few extra bucks to drive more expensive, less reliable gas-guzzlers. However, Chrysler's relentless dismissal of the changing market means that they have pretty much narrowed this group down to the truly obsessive. If the ailing car maker wants to survive into the next decade, it needs to start trying to expand its audience beyond people who value patriotism over performance.

It wouldn't hurt for them to take a good long look at GM, either. While the two-wheeled GM-Segway Puma might not be the solution to Detroit's problems, it at least seems like a move in the right direction.
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