They attract buyers who want to identify with a different bodystyle
By Samuel Ee - 06 February 2006
The Business Times
THE seven-seat SUV may continue to muscle in on the upmarket MPV's territory in 2006 if last year's numbers are any indication.
In 2005, multi-purpose vehicles and sport-utility vehicles were the main beneficiaries of an exodus of buyers from the mid-sized saloon segment. But within the SUV market itself, one interesting development was the strong sales of seven-seater SUV models, of which there are only three here.
The Volvo XC90 is the first model in Singapore to combine the sporty looks of an SUV with the cabin versatility of an MPV. It debuted in November 2002 with all-wheel-drive and hulking good looks. Most importantly, it has a third row of seats which average-sized adults could sit comfortably in, plus enough cargo space for a suitcase when this last row of seats is in use.
But the two turbocharged models - a 2.5-litre and a 2.9-litre - are premium cars, with launch prices starting from $199,000 with COE. Nevertheless, they have seen steady - if not increasing - sales, thanks partly to low supply initially, and partly to lower pricing and additional variants.
Last year, 305 units were sold, marginally up from 302 the previous year. There are now six variants, including a five-seater entry-level version priced at $174,000.
'When the XC90 was conceived, the challenge was to have safety and design gel together into an attractive and versatile package,' says Pang Cheong Yan, general manager of Volvo distributor SM Motors. 'And this it did very well.'
The XC90 has Volvo's well-known safety cage and side impact protection system, as well as RSC or roll stability control. Here, a gyro-sensor checks the car's angle of inclination and applies the brakes to stabilise the vehicle when necessary.
Also on standby is ROPS, or the rollover protection system, with its reinforced roof pillars and inflatable side curtains to protect all three rows of passengers.
Mr Pang adds that many of the XC90's customers include those who drive luxury limousines such as the BMW 7 Series and Mercedes-Benz S-Class.
'It has opened up a whole new segment by attracting people who never used to consider a Volvo,' he says. 'Among some of our customers with young families, it is even considered a hip car.' Mr Pang believes that in general, the XC90 has ridden on the SUV wave, which is seeing an increasingly sophisticated set of buyers who want to identify with a bodystyle other than a sedan.
Also launched in the same year as the Volvo was the Ssangyong Rexton. But despite its pretty styling and attractive price, its third row of seats is less spacious than the XC90's. The Korean model starts from $96,888 with COE.
But last April, the Toyota juggernaut rolled in with what has now become the runaway seven-seater SUV. The Toyota Fortuner is huge, with an equally big 2.7-litre inline four-cylinder engine driving all four wheels. Unlike the Volvo, which is of monocoque construction, the Toyota has a body-on-frame design like a pickup.
This Thai-made model is also taller at 1.85 metres high, which means some carparks are inaccessible. But on the upside, the third row of seats accommodates two adults comfortably. Although not quite in the XC90's price league, the Fortuner isn't exactly a budget model either.
With the Toyota badge and good pricing - its sticker price is currently $94,888 - it was no surprise that it notched up 403 units last year. So authorised Borneo Motors Singapore's stated target of 600 units a year appears easily achievable.
'Most of our Fortuner customers chose it for its seven-seater feature,' said a spokesman. 'But they did not want an MPV, otherwise they would have bought a Picnic or Previa. They wanted the body and shape of an SUV because it's sportier.'
He said most buy it as a second car. Its price has also played a part, even if Borneo considers the Fortuner to be a 'premium' SUV.
'It's not too expensive. It has always been below $100,000,' the spokesman said.
The crossover trend will be given a further fillip this year with the introduction of the Mercedes-Benz R-Class in mid-2006.
Like the above models, the R-Class combines the attributes of an SUV with an MPV but with more car-like styling.
This Grand Sports Tourer, as it is called, has three pairs of seats, four-wheel-drive, and a seven-speed gearbox. Engines offered are a 3.5-litre V6 or a five-litre V8. But in terms of pricing, it will be at a premium, and is likely to start from about $300,000. And as with other luxury SUVs, its affluent clientele will also be less sensitive to higher fuel prices and the car's larger engine capacity.
'We expect continued growth in the SUV segment, driven by the fact that a car is no longer just a mode of transport these days,' said Volvo's Mr Pang. 'Increasingly, savvy customers are looking for vehicles that embody the lifestyle that they identify with.'