Big Changes, Compact Package

Dec 3, 2009

Sport compact performance is a relatively young trend in the United States, but it’s now an integral part of the U.S. motorsports scene. No longer considered a pack of punks, tuners enjoy a wider array of events and higher-quality parts offerings than ever before.

Sport compacts are here to stay, for sure, and restylers can cash in on a strong customer base that’s still growing.

To attract-or keep-these customers, restylers should recognize the preferences and demands of the differing segments of sport compact performance, as well as overall trends. With market segments from drifting to rally, drag racing to show cars, sport compact owners aren’t all looking for the same parts.

The focus is on performance over appearance, and cleaner paint jobs and sleeker body kits have replaced wild graphics and towering wings, industry professionals say.

“It has evolved-for years as long as you had a car that looked good it was acceptable,” says Jason Sakurai, managing director of Roadhouse Marketing, Banner Elk, N.C. and current chairman of SEMA’s Sport Compact Council. “But now that emphasis has changed and evolved into performance as much or more as appearance. That’s always been the trend on the East Coast, but now everywhere it’s overall performance.”

Tuners Today

Most auto enthusiasts have seen that movie. You know the one. Drivers challenging each other to outlaw street races in their wildly colored, modified compact imports. To many outside of the market, that’s still what sport compacts are; but the reality is that the niche has grown up and branched out.

“We’re all trying to figure out what the market is doing, because the market was fairly straightforward in its earlier days,” says Jim Spoonhower, vice president of market research for the Specialty Equipment Market Association. “It used to be all about customizing Honda Civics, but lately it is evolving and fragmenting and it’s difficult to stay abreast. In the early days, it was strictly drag racing, a battle of imports; now you’ve got drifting, rallying, time attack. The different segments make it confusing.”

Where once drag racing was the competition of choice for those with modified sport compacts, now there’s also rally racing and time attack, a type of racing similar to autocross with contestants racing the clock rather than each other. And let’s not forget drifting-pumped up in the third installment of that big-screen compact performance saga, drifting is the hottest craze for sport compact drivers, industry professionals say.

“There are so many trends right now,” says John Miles, account manager, Theory Communication and Design. “Many come from the urban market, and drifting is huge right now. As drifting gets bigger, knowledge of the sport will increase as well. Drifting is huge, but still in its infancy. Once everybody gets a lot of knowledge about it, it’s going to be predominantly what people want to do, but drag events are still huge, too.”

Not only have the events changed, so have the customers-somewhat. The tuner market was demographically diverse from day one. Today there are even fewer lines separating sport compact enthusiasts.

“I think there’s a wider acceptance of ethnicity, but that came right off the bat,” says Sakurai. “It started in the Asian community and spread. There’s a widespread acceptance, almost from the beginning, that the same Honda could belong to anyone. Women participated more than with any other type of motorsport or vehicle.”

Bikini-clad models still grace stages at events and advertisements in magazines, but female tuners have made their presence known in the market. Due to softening gender stereotypes in the Gen Y age group-those who are most interested in sport compacts-women play a stronger role than in any other motorsport.

“When you talk about the performance side of the auto industry there are more young ladies involved in compact performance than any other segment we look at,” says Spoonhower. “Part of the reason is the age; the 18-to-30 group doesn’t have the cultural stereotypes that previous generations grew up with, and the girls are going to compete head-to-head with guys. This gives them another way to show they are equal to or better than the guys. If you go back to the baby boomers, there was a stereotype for guys and for girls. With Generation Y, that stereotype’s not there.”

Not only is the sport-compact owner found in every demographic, he or she is also a very tech-savvy and informed consumer. Most have had computer access throughout their lives, and frequently interact with other enthusiasts online.

“Before there were tons of Internet forums and blogs, you could get away with telling people this intake was worth 15 horsepower, this exhaust would give you 10,” says Sakurai. “It was not backed up by dyno tests, and they weren’t producing those kinds of real-world numbers. Now there are enthusiasts who will take it to a dyno and test it themselves, or put a magazine’s claims to the test. They’re always looking at the numbers. They’ll get on the Internet and voice their opinions on a forum, and they tend to believe another enthusiast much quicker than they would a manufacturer.”

Manufacturers should take note of these enthusiast message boards, but most are wary to become involved, according to Spoonhower.

“Because that demographic is very comfortable with and uses texting and message boards, it’s an integral part of their lifestyle,” he says. “There is a lot of sharing that way, and they invite manufacturers to participate in forums. They don’t want blatant ads, but for the manufacturers to provide info and specifications. Not many manufacturers have jumped on that, probably because they are not comfortable with that type of marketing. I think companies that have younger people making decisions have gone there, and found it productive. Most companies are more comfortable with magazine and TV ads. They’re not comfortable with forums.”

What’s Hot, and What’s Not

Despite such a broad range of market segments, a few trends hold true across the board. Or, rather, trends that are universally disappearing: Gone are the days of fantastic body modifications, under-car lighting, wild graphics and busy paint jobs, except for the show-car builders.

“The dress-up accessories have tapered off,” says Spoonhower. “Things that were purely cosmetic caught on early, but that has now settled down to a secondary product. The enthusiast is more into the performance of his vehicle rather than concentrating on looks. All accessory dress-up parts have softened.”

Sport compact drivers want to make a more subtle statement visually, and a striking one when it comes to real-world performance.

“Everything takes a cycle,” says Michael Myers, owner of Number One Parts Inc. [NOPI]. “We sell more exhaust kits than individual mufflers, and big wings have really slowed down, but body kits are still popular. There are still some smaller ones [wings], but they are kind of sleek. People like them, but not the big ones. All the decals and wild paint jobs have deteriorated as well. Things evolve, and just like clothes styles change, car styles change.”

Giant wheels are now more appealing to the show-car builders than to those interested in performance; strobe lights and neon are favored mostly by the audio enthusiasts and forgotten by the performance crowd.

“Things are starting to get back to the whole notion that if it’s not performing or doesn’t make their car better, they don’t want it,” says Sakurai. “They found that out-they bought big wheels, and ultra-low-profile tires, and they found out the ride quality really suffered. It may have looked good, but it didn’t ride well.”

On the other hand, cold-air intakes and other bolt-on performance items are hot.

“Things like cold air induction-that’s one of the early things enthusiasts seem to do,” says Spoonhower. “It’s not expensive and gives a boost in performance. In a lot of cases, they can do it themselves, unlike turbos and chips, which end up having to be something a professional installs. Custom wheels and tires give them upgraded looks as well as performance, but from there it depends upon what they prefer as far as how they express their lifestyle. It’s difficult, sometimes, to generalize about hot products with this part of the industry fragmenting. For instance, turbochargers would be a big deal in the drag racing scene, but not as much in drifting. There, it’s going to be more suspension and brakes and special tires.”

What’s Next?

Watching the individual segments grow will benefit a restyler. From the high-end bling of the VIP rides to the throaty rumble of a well-tuned drift or drag race car, there’s more than one face to the tuner market, and that translates to the opportunity to sell parts and accessories to a variety of buyers-and for a variety of vehicles.

“What’s being defined as sport compact or compact performance has broadened,” says Sakurai. “When someone says ‘sport compact’ they used to think of Hondas, Acuras, maybe Nissans and Toyotas, and they think it has gone away. It has not so much gone away but broadened to include Lexus and Infiniti, and European cars like VW, Volvo and Saab. The whole of sport compacts have changed and I think there’s a much broader group of cars that fit that profile.”

It’s impossible to predict where the sport compact market will go next, industry professionals say.

“I think it will continue to evolve and fragment; but what those fragments will look like, I have a tough time predicting,” says Spoonhower. “I think it will fragment more. I can see it getting into small SUVs instead of sedans. I can see small pickups being part of it. I think it will be interesting keeping track of what it’s doing as it goes forward.”

But they all agree on one thing: It’s here to stay.

“I think as long as we don’t have a reversal in the price of gas or availability, it’s going to continue to go this way and there will be more sport compacts, and a wider variety of them,” says Sakurai. “I also think we’re going to see different tiers, where there’s some very expensive compact performance cars, and that’s really going to help broaden the market.”