The Wagon, Station Wagon or Estate car has been around for almost as long as the Sedan. It was originally designed to work along the construction of the railway line in North America, acting as multi-purpose vehicle to carry cargo and ferry people around as they got on and off the trains. The first recognized factory made Station Wagon was produced in 1923 by Star which was a division of Durant motors. Due to the commercial roots of the station wagon, from its inception until the 1960s most American built Station Wagons had the wood trimming on the rear part of the car which became its most common indicator, and in fact, a badge of honor showing that this particular car was a Station Wagon. Henry Ford was particularly keen on the wood trim over steel framework design as he had his own hardwood forest which he used to supply the construction materials for his Station Wagons.

Gradually over time, manufacturers began to move away from the part metal part wood construction of the traditional Station Wagon and moved into producing all steel versions of the vehicle. For one thing, it managed to considerably reduce the amount of maintenance that was required in order to maintain the wood trim body in good shape. The first all steel Station Wagon was produced in 1946 after the Second World War by Jeep. Jeep has in fact been the founder of many of the most common vehicle types found today including the SUV.

The market for Station Wagons has been steadily decreasing in recent years as other types of vehicles have been gradually eroding the market that was previously dominated by Station Wagons. The rise in particular of the SUV has largely come at the expense of the traditional Wagon with the SUV offering greater safety, more cargo capacity and in many cases more luxurious extras and features. Also, the rise in the People Carrier has also eaten into the traditional Station Wagon market.

As a result most Station Wagon manufacturers have either discontinued their lines or have made some radical changes with the market now basically being split in two. Most Station Wagons now fall into one of these two categories, the budget Wagon with few luxuries designed to come in cheaper than an SUV and capture the segment of the market that can't afford one, and the ultra luxury section of the market where Station Wagons are still regarded with the same level of prestige as they were when the hardwood trim was regarded as a sign of distinction.

Having said that, most of the manufacturers who were traditionally strong in the Station Wagon sector still maintain their flagships models which includes the Volkswagen Jetta Sportwagen, Subaru Outback, Volvo V50, Cadillac CTS Wagon, Mercedes Benz E Class, Audi A4 Avant and on the budget end of the scale, the Kia Soul and Peugeot 207.