CUVs, Entry-Level Cars Steal Market Spotlight.

WITH consumers concerned about gas prices and mileage but still searching for style and innovation, it was no surprise that CUVs stole the spotlight last week at the North American International Auto Show in Detroit.

The 2007 model year is stacked with these crossovers--small SUV-like bodies built on car platforms that are more fuel efficient than SUVs. Ford research predicts CUVs will shoot past a falling SUV curve by year's end. The company said sales of all SUVs in 2005 hit about 2.4 million, compared with 2.2 million CUV sales, and that the number of models classified as CUVs jumped from 14 in 2000 to 41 in 2005. Even the industry's elder statesmen are looking here for the revitalization of prestige nameplates. "The MKX is following the Zephyr in attracting younger buyers to the Lincoln brand," said Michael Laquere, Lincoln MKX marketing manager, Dearborn, Mich., of the Ford division's first crossover.

Another segment attracting attention was younger consumers. "The entry-level segment is going to be an all-out war," said Rob Schwartz, executive creative director at TBWA\Chiat\Day, Playa del Rey, Calif., which will create a campaign for Nissan to support the May launch of the $13,000 Versa. "The casualty will be the truck and SUV business."

Some in the industry predict more "edgier" youth-oriented ads will result. Though the market sector typically splits between young people buying their first cars--usually with the help of a boomer parent--and aging boomers themselves, the campaigns will speak an echo boomer's language.

"It's a very weird segment," said Ian Beavis, vp-marketing at Kia Motors America, Irvine, Calif., whose revamped Rio recently launched. "The segment includes some under-30 and some over-50, even retired people. The real question is not about the quality of the cars themselves, but how they will impact the next level up: the [Toyota] Corolla, [Nissan] Sentra and [Honda] Civic."

Honda's spring Fit launch will be bolstered by event and "experiential" marketing, said Tom Peyton, senior manager of national advertising, Torrance, Calif. "The next big market is the echo boomers. It will be further reinforcement of the need to experiment and try new media because the echo boomer doesn't watch TV as the last generation did." Also, said Peyton, it will "change the type of creative you'll see. It will have a more youthful tone, edgier, with the morals of that generation reflected and seeing advertising pushing the envelope."

Yaris, Toyota's replacement for the entry-level Echo subcompact, is "one of the most economic and youthful passenger cars Toyota has built in the category," said Jim Lentz, group vp and general manager at Toyota in Torrance, Calif. Toyota's RAV4, its refreshed entry-level SUV, also seeks a more youthful male skew.

But DaimlerChrysler's Jeep styled its new Compass to appeal to young women. "We see Compass as the gateway to the brand, from a styling and price point," said Michael Berube, Jeep senior brand manager, Auburn Hills, Mich. By pricing Compass below Liberty's $18,500 base, Jeep hopes to lower the median age of its buyers from 50 to 40 across all brands. According to Berube, advertising will communicate the brand's "fun, capability and authenticity."

Steve Shannon, general manager at GM's Buick division, Detroit, which showed the Enclave concept SUV, said the reach to younger buyers begins with product. "[You] can't proclaim one day, 'We're hip and cool.' People have to see the products on the road."

PHOTO (COLOR): Motown sounds: Jeep's Compass (above) and Honda's Fit (top of page) attracted attention in Detroit.

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By Gregory Solman