Chrysler LLC's recent sales figures appear to prove that minivan demand is not dead even though rivals have scrapped their entries in the segment.
Consumers and dealers are giving thumbs up to Chrysler's new family haulers. In October, the first full month of sales of the redesigned Chrysler Town & Country and the Dodge Grand Caravan, sales were up 4.8 percent over the same month last year — in a market segment that has shrunk 6.5 percent year-over-year.
Among manufacturers offering a minivan in their 2008 line-up, Honda was the only other to show growth in the segment, with a 30 percent increase over October last year. Ford Motor Co. and General Motors Corp. have dropped minivans from their offerings.
Chrysler's continued success with the segment it helped create in the 1980s is predicated on attracting more buyers such as Amante Bustamante, who last month purchased a 2008 Town & Country Limited. The 35-year-old's purchase is his first minivan and first-ever Chrysler product.
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Bustamante, from Ashburn, Va., purchased the van primarily to haul his family, including a 3-year-old and another on the way, on vacations and to a range of activities.
The styling and entertainment features made the Town & Country stand out against competing vans and SUVs.
Keeping passengers happy
“It's all about keeping the passengers happy,” he said, adding that second and third-row video monitors, a satellite television package and stow-away seats were major selling points.
Bustamante has some qualms about the van's uphill shifting and placement of control buttons, but said overall he's very satisfied with his purchase.
Other buyers also are happy with their new vans, said Sylvia Marino, executive director of community operations at the automotive Web site Edmunds.com.
“Reaction is extremely positive,” she said. “People feel they have great amount of power; Swivel 'n Go seats are a hit; and the comments often are 'My wife and kids loved it.' ”
Leader of the pack
Success with minivans is essential to Chrysler, said Tom Libby, an analyst with J.D. Power and Associates' Power Information Network. The Caravan is the Dodge brand's second-best selling vehicle, behind the Ram truck, and accounts for 16 percent of the brand's total sales, Libby said.
“For Chrysler, the minivan is similar to the F-Series truck for Ford,” he said. “They are perceived as the leader and it is somewhere where they excel … so they want to keep doing well there.”
The Town & Country drove the automaker's minivan growth last month, outselling the Caravan by about 1,000 vehicles. Town & Country sales grew 26 percent from October of last year, while Grand Caravan sales dipped 11.6 percent, according to sales figures from Autodata Corp.
Part of that dip can be attributed to Chrysler discontinuing in 2008 its less expensive Caravan model, Libby said. That cuts out buyers looking for an entry-level van priced between $16,000 and $21,000.
The re-launched 2008 Grand Caravan averages $27,000, for example.
“They have a short-term challenge before the (Dodge) Journey comes out,” Libby said, referring to a mid-sized Dodge crossover to be released next year. “They don't have a low-priced minivan, so I would not expect their performance to equal the prior version.”
The Caravan is in danger of losing its title of best-selling minivan to the Honda Odyssey, which through 10 months this year has sold 3,000 more units. Libby said buyers should look for some Caravan incentives yet this year as the automaker strives to retain its title.
Potential for growth
Dealers say the Chrysler vans, loaded with family-friendly features, are attracting customers even without incentives.
“It's a home run,” said Bob Shuman, operator or Shuman Chrysler Jeep in Walled Lake. “I've got people moving out of larger SUVs and into minivans, and I've got people coming from competing products and going into the Town & Country.”
While $3-plus gasoline could make a minivan attractive to buyers who otherwise might consider less fuel-efficient seven-passenger SUVs, Chrysler's best potential for growth is to attract drivers of other manufacturer's minivans, said Erich Merkle, vice president of vehicle forecasting for IRN Inc.
“They'll pick up former Ford and GM buyers … and they could take something away from Toyota,” he said.
Merkle said the Chrysler minivans are off to a strong start in the market place, but the real test is still to come.
“It will be important to look at how these vans do in March through July,” he said. “That is the time of year people really look at minivans as they are planning family road trips.”
