CHEVROLET AVEO
Paul Sancya  /  AP
They're sometimes hard to spot amid the sumptuous luxury sedans, rugged trucks and dreamy sportscars. But tucked away in the displays at the North American International Auto Show, in the shadow of pricey models or eye-catching concepts, are the small and entry-level options -- like this Chevrolet Aveo -- that often offer drivers their first new car experience.
updated 1/12/2005 5:53:50 PM ET 2005-01-12T22:53:50

They're sometimes hard to spot amid the sumptuous luxury sedans, rugged trucks and dreamy sportscars.

But tucked away in the displays at the North American International Auto Show, in the shadow of pricey models or eye-catching concepts, are the small and entry-level options that often give drivers their first new car experience.

Cars like the Chevrolet Aveo, Toyota Echo, Kia Spectra and Ford Focus offer a more affordable way to get behind the wheel. And unlike stripped-down compacts of the late 1980s or early '90s, consumers don't have to sacrifice air conditioning or an FM radio to get an inexpensive car.

"Obviously, we have a lot of first-time buyers," Chevrolet spokesman Joe Jacuzzi said. "But you also have buyers who are looking for great cars at great prices.

"There are a lot of people who want cars that are very affordable and cars that focus on all the right features."

Premium options on the Aveo include a CD player, MP3 playback capability and a six-speaker audio system, power locks, windows and sunroof and remote keyless entry _ features that once were reserved for higher-end cars. And the story is similar at other automakers, whose small cars are getting more luxurious.

The Aveo starts at under $10,000 and is targeted at the economy side of the small-car market, while Chevrolet's Cobalt, which starts at about $14,000, is aimed at the premium end. And the new HHR, a blend of the SSR roadster and the 1949 Suburban, will be on sale in the second half of 2005 as a third Chevrolet option.

Forrester Research analyst Mark Bunger said General Motors Corp. wants to make the Chevrolet division a competitor in the entry-level market in the wake of strides in recent years by South Korean automakers Hyundai Motor Co. and Kia Motors Corp.

"It's always been a tough market, because generally you're not making a lot of money on those cars," Bunger said. "Entry-level cars still have a tough time because they compete with used cars.

"For a lot of the traditional automakers, it is going to be a very difficult segment."

Hyundai's Accent starts at about $10,500 and is complemented by slightly more expensive cars, such as the Elantra. And Kia's entry-level Spectra compact sedan, which starts at about $12,500, will be joined this summer by the Rio subcompact, which made its debut Tuesday at the show.

"These people are primarily buying for practical reasons, like price, value and safety," Peter Butterfield, president and chief executive of Kia Motors America, said of the small and entry-level buyers.

Ford Motor Co., whose Focus starts in the mid-$13,000 range and is a step above the compact in size, is keeping an eye on the small-car market. Its Syn(us) concept vehicle, shown this week during press previews for the show, is an attempt to redefine the compact market for the urban driver.

Other competitors in the affordable car market include the Dodge Neon and Chrysler's PT Cruiser. And Japanese automakers Honda Motor Co. and Toyota Motor Co. both have kept a strong presence with their smaller cars.

Honda's Civic was redesigned for the 2006 model year to include a host of safety features such as an improved body structure and ceiling-mounted side curtain air bags. And Toyota's Generation Y-targeted Scion brand has been growing, with models like the xA hatchback starting around $12,500.

"They've taken what could be viewed as an inexpensive econo-box, and they really branded it up," Bunger said. "They made it cool, they made it customizable."

Copyright 2005 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Discuss:

Discussion comments

,

Most active discussions

  1. votes comments
  2. votes comments
  3. votes comments
  4. votes comments

Data: Latest rates in the US

Home equity rates View rates in your area
Home equity type Today +/- Chart
$30K HELOC FICO 4.95%
$30K home equity loan FICO 5.19%
$75K home equity loan FICO 4.58%
Credit card rates View more rates
Card type Today +/- Last Week
Low Interest Cards 13.40%
13.40%
Cash Back Cards 17.92%
17.91%
Rewards Cards 17.12%
17.11%
Source: Bankrate.com