Mar 25, 2009

Lower gas, consumer doubts hurt hybrid sales

Hybrid sales were off by 10 percent in 2008, and things aren't getting any better so far this year.

Americans are turning away in large numbers from hybrid cars at a time when automakers are preparing to flood the marketplace with even more of them.

CleanMpg.com reports nationwide sales drops of:

Toyota Prius sales dropped 30.8 percent last month, compared with February 2007.

Toyota Camry Hybrid sales were off for the month by 47.4 percent.

Honda's Civic Hybrid sales were off 21.5 percent.

Toyota Highlander Hybrid sales were off 48.6 percent.

Sales of hybrids are affected by more than just gas prices.

Fuel economy ratings are improving for cars with conventional engines.

Despite educational efforts by the auto industry and others, there still are some consumers who question the reliability and durability of hybrids.

The biggest issue, however, is that "there's still a premium for buying a car with a hybrid system," said Jack Nerad, editorial director at Kelley Blue Book. Hybrids can cost as much as $5,000 more than a comparable conventional vehicle.

The engineering is more complicated, there's more components and the battery packs themselves are quite expensive. And in terms of interior space, accommodations and power, you will have to pay more for a hybrid to get comparable performance in all of those areas.

How many car buyers worry about how well they would be protected from the electricity in a collision.

How much longer will it take for the “jaws of life” operators to extract you from the car because they will be worried about electric shock?

Unless the Obama administration dictates that gas prices go up to $10 per gallon - or put a tax on non-hybrids so that hybrids will be less costly (and don’t rule out either), hybrid sales will probably continue to tumble.

In the meanwhile, the Obama administration will insist that Detroit automakers make more hybrids in order to keep getting bailout money.

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