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Washington DC February 14, 2011; The AIADA newsletter reported that a Detroit Free Press article said that small-car wars are on with a vengeance. New models will challenge dominance of vehicles like the Civic and Corolla.

Meanwhile, fast-growing Hyundai ratchets up the pressure with the stylish and advanced Elantra compact and the upcoming Accent subcompact.

Click here for a chart demonstrating small car sales in the past several years. Some researchers say they believe Generation Y, the millennials whose peak earning years were postponed by the credit crash, learned a lesson about frugality from the borrow-big '00s.

The 68 million millennials have the power to create and collapse whole vehicle segments, just as the baby boomers created the minivan and SUV booms and marginalized the station wagon.

New subcompacts such as the Fiesta, Sonic, and Accent are closer to the old definition of a compact car. That – and the fact that some compacts offer higher fuel economy – may limit their sales potential.

The fuel economy of midsize cars and crossover SUVs also is increasing rapidly enough that they may challenge the new compacts.

As they approach 40 mpg and more, the financial incentive to switch to a small car dwindles.

For more on competition heating up in the small car segment, click here.