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Industry Report Part 2: Canada's Subcompacts are Where the Real Action Lies

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Khatir Soltani

B-Segment Expected to Grow Due to High Gas Prices

As interesting as the compact segment is, the subcompact market is where the most opportunity lies.

Toyota presaged higher gas prices by introducing its new Scion nameplate before the madness started. (Photo: Toyota Canada)

Almost as if seers to the future, Toyota presaged higher gas prices by introducing its new Scion nameplate before the madness started, targeting low-income youth with its B-segment xA and xB, plus C-segment tC coupe, and simultaneously pulling in as many sales for fixed income retirees.

Scion is not planned for Canada, despite how ideal it would be for our market, as the cost of marketing an entirely new brand in such a small market, at least comparatively to the U.S., is prohibitive.

Kia's upcoming 2006 Rio will no doubt improve sales. (Photo: Kia Canada)

Instead Japan's number one automaker went down market with its highly successful Echo Hatchback, a seriously fun to drive subcompact with surprising roominess in all seating positions. The abbreviated model, derived from the global-market Yaris B-segment hatchback, shares its name with the Echo sedan that has long been a best seller.

The Echo Hatchback has put a serious dent into Hyundai Accent and Kia Rio sales, which were down significantly in 2004, also due to the fact that these models are awaiting model updates, with the 2006 Rio having already been introduced in Detroit this past January.

Khatir Soltani
Khatir Soltani
Automotive expert
  • Over 6 years experience as a car reviewer
  • Over 50 test drives in the last year
  • Involved in discussions with virtually every auto manufacturer in Canada