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Small is big and growing in crossover land

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Mini-crossovers -- small, SUV-styled vehicles that share parts and systems with compact and subcompact cars -- could be the auto industry's next boom.

"We'll see every automobile manufacturer enter this segment with multiple vehicles for their brands," said Eric Noble, president of the CarLab, an Orange, Calif., consultant that advises automakers on product development. "We're seeing interest in it from most of our clients. It's a super-promising segment."

You may not have seen one yet, but small crossovers will be all around soon.

From the performance-oriented BMW X1 to a Honda concept vehicle based on the subcompact Fit, there's likely to be a micro-crossover for just about every taste.

"We expect a lot of growth in small and compact luxury crossovers," Buick marketing vice-president Tony DiSalle told me recently at the introduction of the brand's Encore mini-crossover. "People are right-sizing, but they don't want to walk away from luxury."

Buick, long a stodgy brand that offered little beyond traditional sedans, could be a surprising early leader. The Encore combines small size, easy parking and high fuel economy with plentiful passenger and cargo room, available all-wheel drive and the high seating position SUV owners love.

"It's part and parcel with the trend to smaller vehicles," said John Sousanis, analyst with Southfield, Mich.-based WardsAuto.

"Crossovers accounted for 25 per cent of vehicle sales in November. We've grown to love the utility of these vehicles. Getting that combination of people and cargo-carrying capability in smaller vehicles is a natural evolution."

The Encore goes on sale this month. It'll be followed mid-year by the similar-size Fiat 500L, which offers unexpected interior space and Italian charm but lacks the available all-wheel drive that's a selling point for most crossovers.

"Automakers like small crossovers because they share a lot of parts with compact or subcompact cars, but should sell for much higher prices" because of their extra room and capability, Noble said.

Add the fact that a lot of people think crossovers -- models that combine car-type structures and engineering with SUV looks -- are simply worth more than a similarly equipped sedan, and you've got a formula automakers can't resist.

Luxury brands are jumping in with both feet. BMW builds the X1 and even smaller Mini Countryman. Audi may have two little luxury crossovers coming.

"The Encore is a white-space vehicle. It has no direct competition" yet, DiSalle said. Its size and price put it almost directly between the bigger X1 and Countryman. Buick expects the Encore to appeal to young people, parents whose family just grew out of the minivan stage and early empty-nesters.

Buick also sells the Encore in China, and GM's European Opel brand just began sales of a nearly identical vehicle called the Mokka. The vehicle was conceived by product planners in the U.S. and engineered in South Korea with input from North America, Europe and China.

First orders from North American exceeded 9,000 Encores, six times what Buick expected. Opel has 45,000 orders in Europe. Chinese customers bought 6,000 in the first month and dealers have ordered 20,000 more.

Despite automakers' nearly unanimous enthusiasm for mini- and micro-crossovers, Noble cautions there's no track record to show how much buyers want them and how much they'll pay.

"These vehicles are far more profitable than small cars, but we don't know how many of them customers will buy."

-- Detroit Free Press

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