Sales of small/midsize pickup trucks are on fire and automakers are taking notice. General Motors recently introduced all-new versions of the Chevrolet Colorado and GMC Canyon compact pickups, while Toyota has refreshed its Tacoma compact truck, and rumors swirl that Ford might return the well-known Ranger nameplate to the US market. Why, all of a sudden, is the compact pickup truck market so hot?

Economic recovery, for one. Small or mid-size trucks are often used for business purposes, including construction and related fields, and of course construction involves housing. While US housing starts took a dip in August as compared to July, they were still up 16.6% over August 2014, according to the U.S. Census Bureau. Given that these trucks are a little easier to maneuver and park in urban environments and somewhat less pricey than their full-size counterparts, they make sense for business purposes.

Falling fuel prices help, too. According to Mintel’s New Cars US 2015 report, fuel prices fell to $2.60 a gallon in the final week of August 2015. That makes it even easier for people to buy small trucks, as any penalty they may pay in fuel economy compared to a car or crossover SUV is offset by lower prices at the pump.

16% of US consumers who plan to buy a vehicle in the next three years are considering light-duty pickup trucks

According to Mintel’s Car Purchasing Process US 2015, light-duty pickup trucks (including full-size trucks) were being considered by 16% of those who plan to buy a vehicle within the next three years. While that number is small compared to those who plan to buy a car, SUV, or crossover, it’s still a nice chunk of the market. With smaller trucks becoming more car-like in terms of ride and refinement and full-size trucks growing ever larger and unwieldy in urban and suburban environments, smaller trucks have a chance to shine again.

Just a few short years ago, the compact/mid-size truck market swooned. First, it was due to consumers expressing preference for large trucks, then economic problems hurt small businesses while fuel prices simultaneously rose. Automakers focused their efforts on full-size trucks and other types of vehicles, thus leaving consumers with few viable choices. Now, the segment is back, and if the economic conditions remain favorable, it may be back for good.

Tim Healy is an Automotive Research Analyst at Mintel. As an auto expert and seasoned journalist with more than 10 years of professional experience, Tim has a deep understanding of the automotive market, influencing his work on the US Reports team and with clients.

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