Wagon market

Sammy Chan, Senior Analyst

06 January 2021

Wagon wheels falling off

The rise of SUVs is largely to blame for the hit that the wagon bodystyle has taken in recent years and we expect this trend to continue. Our forecast sees market share falling from around 10% to less than 8% in the 2019-2025 period.

Although wagon market share in 2020 looks relatively stable in the above chart, it is worth noting that the bodystyle was supported by recent refreshes, or new generations of the most popular models, including the Škoda Octavia, Volkswagen Passat and Ford Focus. We believe that this will prove to have been a temporary boost and that market share will continue to be eroded, particularly by SUVs.

The Czech, Finnish, German and Swedish markets have the highest share of wagons within their Light Vehicle sales in Europe. But even in these markets, wagon share has fallen in recent years, as it has across all other markets in Europe. The Volkswagen Passat line has always been one of the most popular choices for wagon buyers in Europe and it is set to continue as a wagon-only model, dropping the sedan from the next generation. However, sales of both the sedan and wagon version of the Passat have been falling steadily since the eighth generation refresh in 2015.

One of the reasons why we expect wagon share to continue to fall is the minimal amount of focus on electric vehicle development, compared with SUVs, hatchbacks and sedans. At the moment, the MG5 is the only pure-electric wagon in the UK market. In time, we may see electric wagon variants from the likes of Volvo’s V60, or Volkswagen’s ID. range, but the amount of activity is remarkably low when compared with other bodystyles. It could be argued that a wagon’s bodystyle does not favour the high roofline silhouette often favoured by electric vehicles to balance out the battery storage in the under-compartment.

Not everyone wants to buy an SUV and, anecdotally, several LMC Automotive colleagues are still enjoying the practicality and lower seating position offered by wagons. While we expect wagon market share to continue to contract, we do not see the bodystyle falling completely out of favour just yet.