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Courtesy: Detroit Free Press
High gas prices and improved quality have turned North American buyers on to small cars, so much that the new Toyota Yaris and Honda Fit are selling above list price.
Sales of the diminutive vehicles, called "B-cars" in the industry, are up 43% in the first seven months of the year compared with the same period last year. So far this year, automakers have sold 151,848 of the cars, and analysts say sales will easily surpass the 175,387 sold in all of 2005.
Still, it's just a small fraction of a market dominated by larger vehicles. Automakers sold more than 9.8 million cars and light trucks during the first seven months of the year.
The increase, though, has drawn interest from all the auto companies. Executives at Ford Motor Co. and DaimlerChrysler AG's Chrysler Group hinted recently that they've got new subcompacts in the works. Toyota Motor Corp., Honda Motor Co. and Nissan Motor Co. entered the market this year with great success.
Demand for the Honda Fit and Toyota Yaris is so high that dealers sell the cars at or above sticker price before they arrive at the showrooms.
General Motors Corp.'s Chevrolet has been in the market since 2003 with the Aveo, a tiny car built by the company's Daewoo division. The Aveo is the largest-selling subcompact in the United States, and the company is banking on increased sales when it unveils a redesigned four-door version today.
The Yaris has been the greatest success so far, with 32,822 sold as of July 31. Even though it was just introduced in March, the funky car is closing in on the Aveo for the top spot in the class.
The much-maligned General Motors was actually ahead of the curve on this one, bringing the humble Korean-built Chevrolet Aveo to America just before gas got really expensive. Go to a Chevy dealer. Sit in an Aveo. Fool around with the switchgear. Adjust the vents. Move around in the seats, fold 'em, push on em, move 'em back and forth. Look under the hood. Then go do the same in a Cobalt. Daewoo builds a better rig than Chevy.