LexFather

How are hybrid sales doing so far?
Hybrid Sales Grow Higher
Sales up 53%
AutoWeek

Last month New York City Mayor Michael Bloomberg unveiled a plan to convert the city's taxi service to a hybrid fleet.

In a recent survey, five presidential hopefuls boasted of owning an environmentally friendly hybrid.

And in the first five months of this year, U.S. consumers bought more hybrid vehicles than ever.

U.S. hybrid sales rose 53.0 percent to 143,700 vehicles, excluding the Nissan Altima and Saturn Vue, compared with the same five months of 2006.

That five-month performance meant that 2.1 percent of all new-vehicle sales were hybrids, compared with 1.4 percent through the same period of last year.

"Obviously, it's a small fraction of the entire industry, but in terms of percentage growth, it is still significant," says Jesse Toprak, an analyst at Edmunds.com.

Prius still on top

For the first five months, the Toyota Prius remained the top-selling hybrid in the United States, up 99.6 percent to 76,747 vehicles from the same period a year ago.

The increased availability of popular models, such as the Prius, and a wider selection of vehicles, such as the introduction of the Camry Hybrid, have driven much of the growth, analysts say.

"A lot of it is just due to the newer vehicles going into the market," says analyst Kevin Riddell of J.D. Power and Associates.

Growth should continue, analysts say, as manufacturers continue to offer hybrids in new segments.

In the hybrid crossover market, the Saturn Vue Green Line went on sale in October as a low-cost competitor. And in the hybrid SUV segment, the Chevrolet Tahoe and GMC Yukon are due in the fall, and the Dodge Durango is planned for 2008.

Even the very wealthy will get a hybrid.

Lexus is preparing to launch the LS 600h L hybrid sedan this summer. The price: $104,750, including shipping. Lexus has said it expects to sell about 2,000 units of the LS 600h L annually.

Popularity varies

But the popularity of hybrids can vary, even within the same metropolitan area.

In Chicago, for example, customers at Joyce Ford clamor for the Ford Escape Hybrid, with 10 to 12 people a day calling to ask about it, salesman Mario Gentry says. But just six miles away at Midway Ford, the hybrid has been a "tough sell," according to President Clarence Terrell.

Joyce serves the downtown Chicago market, where consumers are willing - and able - to pay a premium for the hybrid. Customers at Terrell's inner-city store tend to stay with the less expensive base models.

And even as gasoline prices rise, it can be difficult to justify buying the vehicles for economic reasons.

Hybrids "are bought by people with a high sense of social responsibility and the economic means to express it," AutoNation CEO Mike Jackson told Automotive News in a recent interview. "You need both. The economics don't make sense for the mass market."

Forty-five of 50 states had more new hybrid registrations in the first three months of this year than in the same period last year, according to R.L. Polk & Co. In all but two, Louisiana and Mississippi, the growth was in double digits.

Of the five states that saw registrations slip, Tennessee (down 21.1 percent) and Mississippi (down 32.6 percent) sat at the bottom.

Informed buyers?

Most dealers say that serious hybrid buyers have done their homework on the vehicles they purchase. But as more people consider hybrids, the auto industry may have to educate consumers better about the technology - and what it can deliver.

People who consider hybrids generally expect to a 20-mpg increase in fuel efficiency, when the actual difference is closer to 7.5 mpg, a J.D. Power and Associates study found.

"I still think there is a perception gap as to what these hybrids can accomplish as to what they do accomplish," says Riddell of J.D. Power.

Ron Hibbard of Ron Hibbard Toyota in Gallatin, Tenn., says consumers' knowledge of hybrids varies widely. Hibbard had one recent customer tell him he maps his routes to work to maximize fuel efficiency. On the other hand, customers often ask Hibbard where the hybrid gets plugged in. "There's still a lot of curiosity," Hibbard says.

Says Lonnie Miller, R.L. Polk's director of industry analysis: "There is just a big educational variable that the auto industry will have to take the initiative on."

He adds: "There's an awareness of models, but people may not really understand the benefits."

HYBRID SALES
U.S. hybrid light-vehicle sales from January through May

CAR / 2007 / 2006 / % Change
Toyota Prius / 76,747 / 38,460 / 99.6
Toyota Camry / 20,540 / 3,118 / 558.8
Honda Civic / 13,895 / 13,153 / 5.6
Honda Accord / 1,702 / 2,849 / –40.3
Lexus GS 450h / 863 / 435 / 98.4
Honda Insight / 3 / 412 / –99.3

Total car / 113,750 / 58,427 / 94.7

TRUCK / 2007 / 2006 / % Change
Toyota Highlander / 11,909 / 15,404 / –22.7
Ford Escape / 9,252 / 8,948 / 3.4
Lexus RX 400h / 7,095 / 10,003 / –29.1
Mercury Mariner / 1,694 / 1,163 / 45.7

Total truck / 29,950 / 35,518 / –15.7

TOTAL HYBRID / 143,700 / 93,945 / 53

Note: Does not include Nissan Altima and Saturn Vue because hybrid sales are not broken out.

Source: Automotive News Data Center

http://www.autoweek.com/apps/pbcs.dl...8/newsletter01

ff_

I think it's important for people to realize this, rather than immediately buying into the hype. And compare the money saved on gas to the additional cost of the hybrid vehicle, and decide whether you're even coming out ahead.

Bring on the diesels!

LetMeShowU

Sure, maybe the additional cost balances out in the end, but personally I would rather give that money to a company like Toyota to help further research into better hybrids/electric cars, than to the filthy greedy oil companies.

Even if I'm only getting an additional 7.5 MPG, it's worth it.

Jewcano

iTrader: (4)

I've been saying this forever. The amount of time it would take for the average Joe to drive that car till it began to pay itself off is many years. People usually don't keep their cars for that long.

xioix

I'm surprised that the Camry hybrid is outselling the Civic hybrid by that much

JAC JZS

The Camry Hybrid is the best "overall" hybrid out there imo even though it gets less mpg. For a midsize sedan 37mpg is pretty good though (EPA 33/ 34 is low).

LexusFiend

wow ... i was suprised by this ...
Lexus RX 400h / 7,095 / 10,003 / –29.1

Nextourer

hehe... and currently I'm reading 3.9L/100km (60mpg) at 300kms into the tank. And no, I don't live in Texas or Florida (where the majority of our 60mpg ppl are).

GS69

Hybrids Losing Appeal as Cars, Light Trucks Run on Less Gas

It's a sign of the times when Cadillac is staking its comeback on a compact car that boasts fuel economy approaching 40 mpg.

Cadillac's ATS sedan is one example of how carmakers at the Detroit auto show are putting new emphasis on small, powerful models with more fuel-efficient engines as SUVs and even hybrids take a back seat.

General Motors Co.'s luxury brand brags that the ATS will run on a turbo-charged four-cylinder engine that kicks out 270 horsepower while still offering robust fuel economy.

At the same time, Ford Motor Co. said it's dropping plans for a hybrid version of its popular Escape SUV.

While past auto shows have been stocked with gas-electric hybrids and SUVs, slow hybrid sales have brought a dose of reality to the industry.

Carmakers are realizing they can give buyers what they want and avoid the expense of electric motors and batteries by shrinking cars and wringing better fuel economy from traditional gasoline engines.

"The advantages of hybrids are getting harder to justify," said Scott Corwin, a vice president with consulting firm Booz & Co. in New York. "It's the cost differential. Consumers are rational and they understand the cost of ownership."

Hybrid sales slowed last year to 2.2% of U.S. auto sales, from 2.4% in 2010, according to researcher LMC Automotive.

Hybrid challenge

The challenge with selling hybrids is that gasoline engines have become more efficient and the cost of hybrids haven't come down fast enough to justify the added expense for many buyers, said David Champion, senior director of the Auto Test Center at the Yonkers, New York, magazine Consumer Reports.

He pointed to Honda Motor Co.'s Civic, which gets 32 mpg in combined city and highway mileage, and the Civic hybrid, which gets 44 mpg.

The hybrid version of the car saves a consumer $322 in fuel a year, according to the Environmental Protection Agency.

Given the added sticker price, it would take more than 6 years to get the money back on a similarly equipped car at today's fuel prices.

Mike Jackson, chief executive of auto retail chain AutoNation Inc., said that 75% of customers come into his showrooms and want to talk about hybrids.

Only about 2.5% of AutoNation sales are hybrids.

"What happens from the 75% consideration to the 2.5 percent commitment?" Jackson said. "They look at the price premium for the technology, which is already subsidized and discounted, and say 'the payback period is too long; not for me.' It's a back-of-the envelope conversation on the part of the American consumer."

Hybrid premium

After 10 years of hybrids in the U.S. market and oil near $100 a barrel, consumers still aren't ready to pay the premium for hybrid models, said Reid Bigland, president of Chrysler Group LLC's Dodge brand.

Bigland this week introduced the Dodge Dart, which won't have a hybrid version when it begins production in the second quarter.

"The delta you get in fuel-economy lift with a hybrid is continuing to shrink because of the efficiencies with the internal combustion engine" through direct engine, turbochargers and advanced transmissions, Bigland said. "The pure economics are a tough case."

The Chevrolet Volt plug-in hybrid gets people into the showroom, said Chris Perry, Chevrolet's vice president of U.S. marketing. With fewer than 8,000 sales last year, consumers often went to a Chevy dealer to look at the Volt and bought something else.

Half the price

Often, buyers will look at the Volt and then opt for a Cruze compact or Equinox SUV. The Cruze starts at $16,740 and gets a combined 30 mpg or more depending on which version of the car the consumer chooses.

That's about half the price of a Volt even after a $7,500 federal tax credit.

"Some people come in and say, 'The Volt is fantastic but for my needs the Cruze is better,'" Perry said.

Carmakers are even trying to squeeze more out of their expensive sports cars.

Mercedes-Benz is bragging about fuel economy for its vaunted SL coupe.

On the eve of the Detroit auto show, Daimler AG CEO Dieter Zetsche bragged that the new $119,000 coupe is lighter and more fuel efficient that its predecessor.

"Saving weight means saving gallons," Zetsche said.

The new 2013 SL is 22% more efficient that the car it replaces, Zetsche said. With the 306 horsepower V-6 engine, the car gets about 35 mpg, Mercedes said on its website.

Role of hybrids

Hybrids will still be an important part of every automaker's strategy. Ford showed off 2 new hybrid versions of its Fusion family sedan at the auto show.

At the same time, the company said it would cancel plans for a hybrid version of the Escape.

Toyota's new Prius C, meanwhile, costs just $19,000 and gets 50 mpg.

The biggest opportunity for fuel efficiency remains with the gasoline engine, not electric cars or hybrids, for the next decade, said Xavier Mosquet, a senior partner at Boston Consulting Group in Detroit who was one of the advisers to the U.S. bailout of GM and Chrysler.

The battery in an electric car still adds $10,000 to the price of a car at current technology costs and it will be difficult to reduce that penalty in the near future, he said.

By contrast, improvements in an internal combustion engine may improve fuel economy by 40 percent with costs of $2,000 to $2,500 per model by 2020, according to a July 2011 Boston Consulting study Mosquet helped write comparing costs and benefits of gasoline engine improvements versus hybrid and electric car technology.

EPA mandate

Other changes such as weight reduction and better aerodynamics may cut fuel use by 5 to 10% each for costs ranging from $100 to $250 per car by 2020, Boston Consulting said in the study.

The challenge for carmaker will be long-term fuel economy goals. Environmental Protection Agency regulations mandate that carmakers meet a fleet average of 54.5 mpg by 2025.

Sergio Marchionne, CEO of Fiat SpA and Chrysler Group LLC, said the skepticism over electric cars and plug-in hybrids "is well justified."

At the same time, he said, "if anyone thinks they will meet future EPA rules solely with internal combustion engines, they are smoking an illegal substance."

spwolf

lol... considering how many new hybrids are coming out and that Toyota next year will produce over 1,000,000 hybrids, i wonder can the author be any more clueless? All the talk in Detroit has been about hybrids, from many manufacturers.

RXSF

^^ I was re watching some Lexus autoshow debut from 2009, I think it was the HS250h or something and they said that in 2010 they expected to produce 1,000,000 hybrids. Here we are in 2012 and it still hasnt happened?

bitkahuna

iTrader: (20)

yes, there is a tree hugger market. i believe in 10 years we'll look back on hybrids as a weird transitional vehicle type.

spwolf

it was plan from 2007/2008, but thats before recession, recalls, floods, drop in fuel prices, etc, etc.

By my calculations, they should be able to hit more than 1.1 million easily in 2012, and more in 2012, maybe even 1.5 million. By the end of next year they should have: Prius, Prius c, Prius v, Prius PHEV, Yaris, Corolla/Auris, Rav4, Highlander,CTh, ES, GS, RX hybrids selling.

All with reasonable prices if we look at Prius c and Camry Hybrid pricing.

To put this into perspective, Ford sold 30k hybrids in 2011.

spwolf

most cars sold in western markets in 10 years from now will be hybrids... even EVs use same components as hybrids.


so no, not going anywhere :-)

LexFather

Didn't know we were tree huggers.

The same thing was said about SUVs...and they clearly are here to stay. I think until EVs or another energy source (or we just stop driving cars) is the future but that is a long way down the road. Hybrids continue to improve every year and its clear Toyota/Lexus was ahead of the curve here as everyone is now trying to build a hybrid.