2007 Hybrid Sales up 53%, 2012 update

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04-09-12 | 06:38 AM

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GS69

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Hybrid Sales Update

Most Hybrid Buyers Don't Buy Another 1
Polk Study Says

DETROIT -- Almost two-thirds of U.S. hybrid buyers returning to the market in 2011 chose something besides another hybrid.

Excluding owners of the best-selling Toyota Prius, the repurchase rate among other hybrid buyers dropped to 22%, according to a Polk study released today.

According to the study, the loyalty rate for hybrids since the beginning of 2008 has ranged between 26.4% in the 2nd quarter of 2010 and 41.8% in the 2nd quarter of 2009. The rate for the 4th quarter of 2011 was 40.1% while the total for 2011 was 35.0%.

But there is some good news for manufacturers who have invested heavily into developing hybrid technology, said Brad Smith, director of Polk's loyalty management practice.

Conquest tool

Hybrids seem to attract new buyers to brands, and they may also help brands retain customers, he said.

"It's a great conquesting tool for brands," Smith said in a phone interview, calling hybrid technology "a competitive edge when it comes to attracting new customers."

That is especially true for Toyota, a hybrid pioneer that has expanded its Prius hybrid line to 3 body styles and just added a plug-in version.

Polk said in 2011, 60% of Prius owners back in the market bought a Toyota brand vehicle. The study also found that 41% of the Prius owners back in the market either bought another Prius or a hybrid from another automaker.

For Honda hybrid owners, 52% stayed with the Honda brand, but less than 1 in 5 bought another hybrid from any brand.

Competition with conventionals

Smith said the biggest challenge for hybrid makers is that less expensive conventional fuel-efficiency technologies are also advancing rapidly, reducing the fuel-efficiency advantage of more expensive hybrids.

That may be why hybrids accounted for just 2.4% of total U.S. auto sales last year, down from 2.9% in a peak of 2.9 percent in 2008.

"The premium price points for hybrids are just too high when so many conventional small and mid-size cars have improved fuel economy," Smith said.

This was the 1st time Polk has conducted a study of hybrid buyers returning to the market.

You can reach Jesse Snyder at jsnyder@crain.com.