Tuesday, March 17, 2009

Hybrid Car Sales Tank

As I have mentioned before car sales have taken a nose dive off the deep end lately. Americans have cut back on buying vehicles of all types as the economy continues to slow down. I read an interesting article in the LA times by Ken Bensinger which is the basis for this post. Unfortunately for the automakers, due to the low price of gasoline hybrid auto sales have taken a steeper decline than regular automobiles.

Last summer when gas prices were at there peak $4, hybrid sales were hot! Now consumers refuse to pay a premium for a fuel efficient vehicle now that the average price of gas has dropped to $2. The bottom line is that it hybrids are not cost effective presently with the low price of gas. A hybrid can cost up to $9000 more than the same non hybrid vehicle, $9000 will pay for a lot of gasoline. The premium over a non hybrid vehicle can take up to ten years or more to pay for the difference in the additional fuel economy that a hybrid generates.

The average days to sell a Toyota Prius hybrid has gone from 1.6 days in July 2008 to 76.6 days in March 2009. The Camry hybrid has gone from 4.6 days to 156.2 days during the same period.

President Obama is calling on the automakers to build the cars of tomorrow, but the present business case is costing the auto companies money. Currently the auto companies complain that they loose money on every hybrid that they produce. Congress is pushing the auto manufacturers to improve mileage as a key to reducing U.S. dependence on foreign oil and limiting the global warming gases that autos emit.
Manufacturers from across the world are increasing their hybrid models. Here are the latest updates. Honda plans to introduce the new Insight hybrid in the next few weeks after discontinuing the Honda Civic hybrid in 2008. Hyundai and Audi plan to deliver their first hybrids sometime in 2010. Toyota has the new Prius coming in the next few months along with a new Lexus hybrid.

Since the big three U.S. automakers have testified before congress, the biggest push will be coming from the American manufacturers. Ford plans to follow its high mileage Fusion and Mercury Milan hybrids (see Feb. 6th post Can Detroit Build Hybrids?) with a battery powered van in 2010 and a family of hybrids in 2012. Chrysler has committed to eight new hybrids or electric cars by 2015. Meanwhile, GM indicates that 26 of the 33 cars they sell in 2015 will be some type of hybrids, including the Chevrolet Volt, a plug in hybrid due out next year. I have a future post coming on the Chevrolet Volt, which is a game changer for GM and the auto industry.


  1. Hi Pete .. the average sales day is a pretty shocking statistic; however I guess every business is experiencing some major down turn.

    I see you mention hybrids .. does your post above include hydrogen cars .. probably not the right word or phrase ..

    Transport as a whole has to change and the economic downturn has to bring some new developments ..

    Thanks - Hilary: Be Positive Be Happy

  2. Hey, if you're gonna use content from another news source, please be considerate and credit where you got it from. This reporting was done by someone else and that person deserves credit for his work. In this case, it was the Los Angeles Times.


  3. Hilary,

    Thanks for posting to my blog! I appreciate your comments!

    Your the last couple of years hybrids have been the best sellers. Now that has changed due to the economics of the situation.

    We are experiencing a paradigm shift in the car business now. I am going to do a post on what I view is happening.

    Best Regards


  4. Hello Anonymous,

    Thanks for visiting my blog! I am new at blogging so I appreciate constructive criticism. That is the only way that I can improve my blog.

    I will make the appropriate changes to the blog post! Thank you for your input!