What to do about cars?

NEW YORK -- The flood of SUV and crossover debuts continued unabated during last week's New York auto show press days. But behind the scenes, industry executives were grappling with questions about cars -- ones that could shape investment, product and marketing plans for years to come.

How low will cars' share of the U.S. market -- 37 percent in the first quarter, off from 41.5 percent a year earlier -- ultimately go? And how to reignite the appeal of cars?

Some strategies were on display here. FCA US sought to pump up cars' appeal with the debut of the outrageous 840-hp Dodge Challenger SRT Demon drag racer. Nissan North America also bet that sports cars will always appeal, showing a 370Z Coupe Heritage Edition. Acura valiantly went once more into the midsize sedan breach with the 2018 TLX, which goes on sale in June.

Amid far flashier and more numerous crossover and SUV debuts, though, it was clear that restoring the luster to the mainstream sedan won't be easy. Nonetheless, executives cited two reasons to nurture their car lineups:

1. Cars are global products that are needed in other markets.

Ian Robertson, BMW AG board member in charge of global sales and marketing, said the brand is not changing plans or de-emphasizing cars. 

"Sedans are effectively, if you look around the world, pretty stable at a volume level," Robertson said. "It's the same here in the United States. But any upside in the United States has been taken by increasing SUV sales." 

Likewise, Michael Bunce, Nissan North America vice president of product planning, said, "Consider that we're talking about global platforms. Sedans are still the No. 1 segment in Mexico, for example, and we're the market leader in Mexico. So yes, we have to continue investing in cars." 

2. Just as consumer tastes -- and petroleum prices -- have flipped in the past, they could again. 

Joe Hinrichs, Ford president for the Americas, recalled being told in the 2007-08 era of rising fuel prices that SUVs were going to decline. And with gasoline prices topping $4 a gallon in 2008, indeed, light-truck sales fell faster in the U.S. than car sales did in 2008 and 2009. 

"I bring that up because it's important that we have a balanced portfolio," Hinrichs said at the NADA/J.D. Power Automotive Forum. 

"We don't know exactly what's going to happen. If fuel prices spike, it does have an impact psychologically on buyers." 

Still, Ford's first-quarter sales were hardly balanced: 76 percent truck, 24 percent car. Sales of the Ford Fusion, the automaker's top-selling car, tumbled 32 percent to 50,786 units. That total trailed unit sales of three Ford trucks: the F series, Escape and Explorer. 

The picture at Ford mirrors the industry. While car sales in the U.S. rose coming out of the recession, climbing steadily in 2010-13, truck sales rose faster in all but one of those years. Then car sales began a quickening slide. They fell 2.3 percent in 2015, 8.9 percent in 2016 and 12 percent in the first quarter of this year. 

Truck sales kept climbing.

Hinrichs conceded that Ford is always scrutinizing its product lineup.

"When you look at it, you can tell what segments are in decline and what segments are growing," he said. "You have to at some point decide to participate in segments that are growing, and also at some point, you need to decide if you're in a segment that's declining, when do you stop investing in it? When do you get out?"

Some automakers still see mainstream cars as a profit center.

Bill Fay, senior vice president for automotive operations for Toyota and Lexus brands in North America, said light trucks made up 58 percent of the two brands' U.S. sales in the first quarter, vs. 63 percent for the total market. But he says the strength of the company's cars lessens the pressure to match the market.

"Although the market has some significant movement to utility-body vehicles, through the first quarter, Camry was the No. 1 selling car, Corolla was the No. 3 selling car," Fay said. "We still get a lot of volume and satisfy a lot of consumer interest in our passenger cars."

This year, though, Toyota expects its best-selling U.S. vehicle to be the RAV4 compact crossover. In the first quarter, both the Camry and Corolla outsold the RAV4, but sales of the Camry, the best-selling car in the U.S. for decades, dropped 13 percent and Corolla sales fell 8 percent. RAV4 sales rose 5.8 percent. Fay said Toyota expects to sell as many as 400,000 RAV4s this year.

Mercedes-Benz is not trimming investment in cars, lengthening product cycles or reducing the number of variants it offers, said Dietmar Exler, CEO of Mercedes-Benz USA.

"Attractive product will always be sought after in the market, and we saw that with the [redesigned] E class," Exler said. "You're talking about a segment everyone says is difficult." Yet E-class sales rose 39 percent in the first quarter "because we've got great product."

But some automakers are exploring ways to minimize investments in cars.

When General Motors' sale of Opel was announced in March, President Dan Ammann showed a chart listing "North American cars" as targeted for reduced investment. GM is cutting back because it doesn't see enough returns in the future to justify going full-speed ahead.

What does less than full speed imply? Product chief Mark Reuss has said that automakers need to try nontraditional approaches to cars, and that "we can do more variants off fewer architectures."

When Buick introduced the redesigned Regal this month ahead of the New York show, there was only the Sportback, a four-door hatchback, and the TourX, a wagon.

Reuss said the decision to skip a sedan entirely showed that automakers can keep cars fresh "in ways that people might not regularly think about the car segments."

Laurence Iliff, Amy Wilson, Lindsay Chappell and Nick Bunkley contributed to this report.