This Is What’s Going to Replace Your Boring Old Sedan

A new automotive segment is being hatched this Easter Week at the New York International Auto Show—the small SUV. Three new models aimed directly at millennials made their debuts: Chevrolet’s Trax, Jeep’s Renegade and Honda’s HR-V. “The small SUV is truly becoming the next big thing in the global auto market,” says Alan Bately, GM’s CEO for North America. Worldwide, the car manufacturers expect small SUVs to generate two million units in sales in 2015.

That’s more than enough sales to attract the likes of Fiat-Chrysler’s Jeep division, which unwrapped a gorgeous little Renegade. It’s the latest effort by the company to extend the Jeep brand, one of the hottest performers in the company, on a global scale. The Renegade has a passport, too. It was designed in Auburn Hills, MI. But the car will be manufactured in Fiat’s plant in Southern Italy, to take advantage of the company’s small car manufacturing skill as well as the available capacity.

Honda is adding the HR-V to its small vehicle lineup for a winter launch. It’s built on the same platform as the subcompact Fit.

The attraction of small SUVs, say manufacturers, is the combination of urban maneuverability, versatility, and improved fuel economy. “People are moving to smaller SUs because they like the SUV attributes like higher chair height for better command view of the road. They like the versatility between passengers and cargo,” says Jim Brown, Chevy’s product manager for small cars.

Named for a 2007 concept vehicle, the Trax was launched in late 2012 in Mexico and Canada as a 2013 model. About 90,000 have been sold in more than 60 global markets. In addition to the U.S., the 2015 Trax will also go on sale in China, adding the small SUV to Chevy’s two largest markets. Made in Korea, it will be in showrooms this December and likely cost in the mid $20,000s.

The development of the small SUV segment also demonstrates that millennials have entirely different criteria for purchasing cars than their parents did at the same age. To them, a small SUV is an all wheel drive iPad with room for their friends and their stuff. “A generation ago maybe there was more emphasis on horsepower, performance, those type of things,” says Cristi Landy, Chevy’s senior manager of strategy for small cars. “Now the most sacred possession for a lot of these people is their smartphone, so we’ve been able to integrate that technology into the vehicle very seamless fashion.”

The Trax will be available Siri Eyes Free, a 7-in.-diagonal color touch screen and additional USB ports. OnStar 4G LTE with a built-in Wi-Fi hotspot will allow passengers to connect multiple devices. And the driver can navigate with downloaded apps such as BrinGo, which will keep the cost of options down. Embedded music apps will include Pandora, Stitcher, and TunedIn. It will also have an engine, no doubt.

At Jeep, the new Renegade comes in urban and rural flavors, Latitude and Trailhawk, with a couple of powertrain and 4×4 options that can suit a variety of drivers, “whether it’s rigorous off-roading or just some social climbing in the city,” notes Jeep CEO Mike Manley. The 9-speed automatic transmission claims more than 30 mpg. Hewing to its off-road heritage, though, Renegade offers two “intelligent” 4×4 systems—Active Drive and Active Drive Low in the Trail Hawk version. The former allows seamless transfers between 2- and 4-wheel drive; the later is designed for ultra off-road travelers.

“Make no mistake, Renegade is pure Jeep,” Manley says, pointing out details such as the rounded headlamps and the seven-slot grill. The Renegade may have been conceived in America, but this Jeep also shows its Italian refinement. The design of the upper part of the SUV just screams Fiat. The curve of the windows, tilting toward the rear, the interior styling and the wide environmental view from inside all take cues from Renegade’s Italian in-laws, the Fiat Panda and 500.

Honda’s HR-V lacks any Continental legacy, nor can it claim much in the way of off-road chops. Then again that’s not what you’d expect from a Japanese utility vehicle. Instead, Honda is making a play for urban cool. The company says the HR-V will feature Honda’s Magic Seat, which morphs quickly into multiple configurations and allows the second row seat to go flat for added cargo space. It will be a complement to the Fit and a competitor to crossovers such as Nissan’s Juke and Kia’s Soul.

The manufacturers expect sales of small SUVs in the U.S. to increase 87% over the next three years, which is one reason they are rushing them to market. More importantly, these are vehicles perfectly suited to first time buyers. Get them now, goes the strategy, and you have a good shot at keeping them for decades.