Chevy joins growing small-van market
Ford's success with Transit Connect lures 3 challengers
When: Arrives at all 3,200 Chevy dealers in 3rd quarter
How much: Not announced; likely close to Ford Transit Connect’s $22,995 starting price, including shipping
Fuel economy: Expected to be 24 city, 25 highway, 24 combined
Hauling capacity: 1,500 lbs.
Cargo room: 127 cubic feet
Target customers: Small business owners
Competitors: Ford Transit Connect, Nissan NV200, Ram ProMaster City
CHICAGO -- Ford's Transit Connect will have its first real challenger this fall when the City Express compact cargo van arrives at Chevrolet dealerships.
The Nissan-built City, which was introduced last week at the Chicago Auto Show, has a tightly focused mission: appeal to small business owners who need a nimble, fuel-efficient cargo hauler with a versatile interior.
The vehicle will come in just one body style and with one powertrain. It's the third entry into the segment pioneered by the Transit Connect.
The City Express is built for Chevrolet by Nissan and is based on the Nissan NV200. The Chevrolet and Nissan versions will compete in the small but growing niche that was created in 2009 by the Transit Connect.
Nissan launched the front-wheel-drive NV200 last March and reported sales of 4,619 units for the year. As part of Nissan's effort to establish itself as a player in the commercial sector, it also offers the full-sized rear-wheel-drive NV van.
Small cargo van sales are expected to grow from about 44,000 units in 2013 to around 120,000 units by 2017, according to IHS Automotive, a suburban Detroit consulting firm.
A fourth small van, the fwd Ram ProMaster City, arrives late this winter. It is based on the Fiat Doblo and will be built for Ram by Fiat. Both the City Express and the ProMaster City will be built in Mexico.
Chevrolet officials did not mention prices when they introduced the City Express here last week but said the vehicle will be competitive with the Transit Connect, which starts at $22,995, including shipping.
Ford has owned the small-van niche. Sales of the fwd Transit Connect rose from 8,834 in 2009 to 39,703 in 2013 -- a jump big enough to catch the attention of Nissan, General Motors and Ram.
The appeal of compact cargo vans to small business owners are low purchase price, good fuel economy, ease of parking in cities and interiors that can be configured with shelves, tie-downs and floor-based storage options.
"If you look at a florist or a bakery owner, they don't care about a van's cargo and towing capability. They are looking for a nice interior to move a large amount of items," said Mike Jackson, IHS' director of North American forecasting.
City Express is powered by Nissan's 131-hp, 2.0-liter four-cylinder engine teamed with a continuously variable transmission. This is the first time GM has offered a CVT since the 2004 Saturn Vue. Fuel economy is likely to be identical to that of the NV200's: 24 city, 25 highway, 24 combined. That falls short of the highest EPA-rated 2014 Transit Connect at 22 city, 30 highway, 25 combined.
"I think this market is really going to grow," said Ed Peper, Chevrolet vice president of fleet and commercial sales.
Peper said he expects the City Express to appeal to Chevrolet customers who already have an old van they need to replace.
"For us, you are going to see some migrations from past products that we have had, minivans and even back to the Astro," he said. "Some people still have Astros, Ventures, Uplanders and HHRs."
Chevrolet officials would not say how many units they plan to sell, but it will likely outsell the NV200, Nissan officials admit. But the extra sales help maximize capacity utilization at Nissan's Cuernavaca, Mexico, plant.
"We are very bullish on that segment," said Peter Bedrosian, Nissan's regional product manager, product planning and strategy. "Businesses are just discovering they can downsize and that these vehicles can work. Contractors and professionals that run a business are all about using the right tool for the job."
Ford executives expect the Transit Connect to remain the segment's best seller. Ford recently launched a refreshed version of the Transit Connect, including a passenger version, and an optional turbocharged engine.
Doug Scott, Ford's truck marketing manager, said he doesn't see Ford's slice of the small-van pie shrinking.
"Our projection is that the market will grow," said Scott at the Chicago show. "We feel pretty good having the dominant position."
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