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Thursday, October 07, 2004 - Page updated at 12:00 A.M.

SUV backlash in Europe gains traction

By REBECCA GOLDSMITH
Newhouse News Service

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PARIS — In England, sport-utility vehicles are derided as "Chelsea tractors," a slight that refers to the affluent London neighborhood where BMW X5s, Mercedes-Benz MLs and Porsche Cayennes jam the roads.

In Sweden, they are "Montessori wagons," a jab at wealthy families who bring their children to exclusive private schools in off-road vehicles.

In Paris, SUV sightings are rarer. But they may be even more infuriating for a driving public that favors modest French-made brands such as Renaults, Peugeots and Citroens.

The aversion cuts deeper than a few epithets. In recent months, politicians around Europe have discovered the popularity of anti-SUV measures. In several countries, lawmakers are weighing policies that could dampen sales through tax increases and outright bans.

London's mayor, an advocate of public transportation, recently slammed SUV drivers as "complete idiots" and proposed charging them double the $9 daily congestion fee just for the privilege of driving around the city. Paris' socialist-run council wants to ban the large cars from the city center. And the French government tried to raise taxes by up to $3,683 on heavy vehicles while giving discounts of up to $982 on smaller, lighter cars.

European carmakers take issue with the criticism, saying they are using diesel engines and better technology to make their SUVs safer and cleaner than U.S.-made counterparts.

The opposition to SUVs illustrates fundamental differences in the culture of cars.

In the United States, SUVs' size and stature appeal to Americans' romance with the open road and the endless horizon. Middle-class folks buy them to get a feeling of security in an insecure world.

But in Western Europe, SUV drivers seem to flout social mores that emphasize less flamboyant lifestyles, environmental consciousness and respect for others. In this climate, SUV drivers get labeled as road-hogging, gas-guzzling pigs. It doesn't help matters that some German models cost more than many people's homes.
 
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At the recent Paris auto show, thousands of models — from the tiniest, most fuel-efficient city cars to the biggest, thirstiest trucks — shared floor space. European auto strategists talked about how to address the criticism of SUVs before the backlash gets out of hand.

Social acceptability is key to Porsche, for instance, which cannot afford its SUV, the Cayenne, to be tainted by bad public relations. In the 1990s, the company watched helplessly as interest waned in showy sports cars, said Hans Riedel, executive vice president of sales and marketing.

In the past 18 months, the company found a winner in the Cayenne, which appealed to women and a broader base of Porsche buyers worldwide. The company, which sells the cars for $54,000 to $89,000 in the United States, has sold 60,000 so far, about half of there.

"We're watching it very closely," Riedel said of the European SUV backlash. "You can only get away with a luxury-car buy if your neighbors let you get away with it. We'd rather have a thumbs up from another driver than another finger."

While SUVs make up a quarter of the U.S. market, the big cars comprise a small but growing part of the European market. Out of 11 million cars sold in Europe each year, about 800,000 are SUVs. That is up from just 500,000 three years ago.

"We all expect the SUV market will continue to grow in Europe," said Detlef Wittig, executive vice president for Volkswagen, Europe's largest automaker. In two to three years, SUV sales in Europe are likely to reach 1 million, he said. Worldwide, SUV sales total 4.5 million a year, up from 900,000 a year in the early 1990s.

Growth in European markets may be especially important if the American love affair with the light trucks starts to flag.

A slowdown in the U.S. market for SUVs appeared to take hold this summer. A study by the Power Information Network showed that the big cars sat on lots for an average of 73 days this summer — 22 percent longer than they did the previous summer. Ford blamed record-high gas prices for the dip.

But European growth could sour if regulators keep SUVs from the market, auto executives warned. In Sweden, a budget compromise between political factions led to higher fuel taxes and the possibility of taxes of up to $20,000 per vehicle on SUVs by 2006.

The measure is aimed at Ford-owned Volvo Cars, which is one of Sweden's largest employers and exporters.

Volvo Cars' president and chief executive, Hans-Olov Olsson, said he is prepared to fight back. He said his company put plans on hold to hire another 600 workers to churn out more of its successful XC90 sport-utility vehicles. The company sold 90,000 of the $40,000 cars, about half in the United States.

Only about 5 percent of the cars stay in Sweden, but Olsson said the measure still hurts.

"Every single action is marginal. But as you add it up, then it becomes dangerous," he said.

Lawmakers' urge to regulate consumer behavior is also typically European, and carmakers' defiance may not find much political traction.

"Do you call 4.6 million people (SUV drivers) irresponsible, or are the car manufacturers irresponsible? Or are the people trying to create an issue irresponsible? Take your pick," said Riedel of Porsche. "We're not a socialist society. We're a society with free choices."

Copyright © 2004 The Seattle Times Company

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