According to mlive.com, auto industry analysts predict that the hybrid “premium” and consumer acceptance of $3 a gallon gas will dampen near-term demand for gas – electric vehicles. J.D. Power and Associates senior manager Michael Omotoso says the arrival of the next gen Prius will revive the genre. "In 2009 we see hybrid sales going over 600,000 units." Over at AutoNation, some 70 percent of car shoppers inquire about hybrids– but only two percent end up buying one. Spokesman Marc Cannon claims the Prius has been successful because "Americans really like that fact that the Prius stands out and it's a social statement; if you have a Prius, everyone knows it's a hybrid." And what of battery-powered cars? "The lithium-ion battery is nowhere near ready for showtime," says Brett Smith, a hybrid analyst at the Center for Automotive Research. Still, the Volt hype has raised expectations– and how. "Whoever sees those concept cars thinks it's ready to go." As Albert Einstein said, “Reality is merely an illusion, albeit a very persistent one."
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Maybe Michigan is not the best place to get an accurate view of the rest of the country
Sherman Lin :
Maybe Michigan is not the best place to get an accurate view of the rest of the country
Gross Grosse Point myopia, as usual.
Hmmm… well if I were in the market for a family car/commuter and HAD to get a new car, the Prius would likely be the top choice.
The economics of it for the long-term owner are simply too good to pass up. I also like the utility of the hatchback as well.
Steven: That’s what I did. I bought at the beginning of 2007 when gas prices dipped and Prius demand dropped. I was able to get the dealer to budge on price to make a sale.
I now do about 70 miles a day, 80% highway (I was doing 100mi/day for most of ’07), and after 24,000 miles I am getting about 46mpg, which is off my gas receipts, not the car (though the car’s calculation only differs slightly over that period). I also drive it like any other car (I don’t try to hypermile, etc.)
So far it has been trouble free. The hatch configuration holds an amazing amount of stuff. I had been looking for a small cheap pickup (ie – a used Ranger :) ) but so far the Prius can do 70% of what I need. For the big stuff I rent a truck for the day.
I plan on keeping it 8-10 years so I believe any hybrid premium will be amortized out over that length. I have a friend with a 1st generation Prius with 220,000 miles on it with only standard maintenance done, so I am hoping for something similar!
For those that say, “eww a Prius,” don’t feel sorry for me – I have other “toys” I take out for the warm months!
Funny, one of the more recent news items is that gas may go up by $.50 per gallon this spring and summer. What do you think the chances of it going significantly back down are? High gas prices are here to stay (unfortunately) and as a result, so are hybrids.
I find it amusing that probably 95 percent of American drivers could save vastly more fuel than a hybrid ever would simply by rationalizing their trips: Don’t go to the post office and then later the gym, go to the post office on the way to the gym. I no longer go anywhere without recalling that old World War II propaganda phrase (yes, I’m that old), “Is this trip necessary?” And it has made a huge difference in my monthly mileage. I used to jump into a car whenever I felt like it, now I do it when it makes sense.
And, no, you don’t have to compromise by buying a small or low-power car, the proportion of fuel savings is identical if you keep driving your Suburban or Viper.
Stephan: We may not be too far off in age! As a child of Depression-era parents, and as someone who lives out in a rural area, we always try to minimize trips.
For example, today we’ll go to the dump, park at the hardware store and go there, the pharmacy and the bank, stop for a quick lunch, back in the car, stop at the grocery store and return home. I don’t really spend very much extra on non-commute miles. I wish I could live closer to work, but cost of housing there coupled with the “nice to live in” feel of where I am now negates that.
Exactly what I mean, although I sure wish we still had a real hardware store…Hudson River Valley, also semi-rural but too many malls have put the good merchants out of business.
Fortunately, I only have to commute 30 feet from the bedroom to the computer.
Sherman Lin :
Maybe Michigan is not the best place to get an accurate view of the rest of the country
Gross Grosse Point myopia, as usual.
Certainly Los Angeles is the best place to get that accurate view, right????
UnclePete: “I find it amusing that probably 95 percent of American drivers could save vastly more fuel than a hybrid ever would simply by rationalizing their trips.”
I’ve already done that, as have others. I’m still looking to get a high-mpg car, likely a hybrid, to cut fuel use and CO2 emissions further. And, when practical, I don’t use a car at all; I bike or walk.
You don’t have to be pre-war to figure this out.
And the proportion of savings is the same but the total reduction increases if you go with a high-mpg car.
Well, that’s good, but I suspect you’re still among the five percent.
Certainly Los Angeles is the best place to get that accurate view, right????
It is, actually. Many automotive trends that ultimately take hold across the US begin in California.
If Rick Wagoner and Bob Lutz were forced to spend their daily commutes surrounded by the competition, it might awaken them from that dark stupor that must dominate their workplace. They don’t do themselves any favors in thinking that they’ve done enough, when they haven’t really yet begun.
If Detroit wants to sell to the rest of the US they must give us what we want becasue if it isn’t obvious by now we don’t have to buy what Detroit thinks is best.
I live in Florida and ther Prius is very popular.
I would have hoped ignoring the customer was a thing of the past from detroit.
When I was at Car and Driver in the early and mid-1970s, one of the things I was stunned to learn, having come to cars from the aviation world, was that all Detroit decision-makers were chauffeured, and of course in their own company’s cars. They truly believed that Lincolns and Cadillacs were the best the world had to offer, and they _never_ deigned to take the wheel of anything.
One of them once told me that Mercedes-Benzes were no good: He’d sat in one once, and “the seats are too firm.” Of course he’d never done a 500-mile day on Autobahns on those firm, supportive seats, so he felt the Barca-Loungers on which he rode were the world standard.
I would have hoped ignoring the customer was a thing of the past from detroit.
Don’t worry, they have. They’ve since progressed to insulting and ridiculing the import buyers, instead (which is getting easier, as every day, there are more of them to ridicule.)
When I was at Car and Driver in the early and mid-1970s, one of the things I was stunned to learn, having come to cars from the aviation world, was that all Detroit decision-makers were chauffeured, and of course in their own company’s cars. They truly believed that Lincolns and Cadillacs were the best the world had to offer, and they _never_ deigned to take the wheel of anything.
They still think like that at GM and they will continue that way until it crashes and burns and then we can witness the stunned look on their faces as they look at each other and ask “what happened”?
Hybrids aren’t dying, mostly because of the economic logic UnclePete lays out: the Prius makes sense pure and simple.
What we have to wrap our minds around is that the auto industry is in the middle of a couple of decades of high risk, high stakes experimentation. Diesel, hybrid (two-mode, serial, parallel) E85, electric, they all have a place right now.
Eventually, one of these technologies will win. The losers will be companies like Chrysler that don’t have a horse in any race. The game will be over before they get a chance to enter.
I heard a “car talk” type of radio show today. This guy was saying that if the so-called experts are right, and we have reached “peak oil” output (ie, we have already used half of what was in the ground), then China could actually use up all of the remaining oil just by building the roads that they’ve already planned for.
I decided to get a Prius because I wanted to use less gasoline. No environmental motive. No financial motive (although like Uncle Pete, I had done the math anyhow).
I simply had decided that I wanted to use less gas. Now that I own a house, I drive more than ever before. But at least now I STILL use less gas!
By the way, my “kitchen table math” is much the same as Uncle Pete’s logic outlined above. The “breakeven” point was interesting to me, but it was not a motivating factor in my case.
Originally, I had planned to keep my Prius for 6 years, but now I’ve decided to keep it for 7, or another way of thinking about it…I’m going to keep it for 16% longer than I had originally planned.
I am a former sports car owner. Don’t have any now, but I’m telling you, if Mazda, BMW, Mercedes, Toyota, or Honda ever thought to do a hybrid or otherwise very-high-milage version of a Miata or Z4 type of vehicle , I might just be convinced to get a second car again…
But until then, my Prius does 100% of what I need it to do. Until I need to haul that limestone and concrete home, in which case it will only do 99% of what I need it to do…
I spent a week last month driving all over California between San Francisco and Los Angeles.
The only thing different I noticed driving in California was more hybirds, a lot more European cars than in Ohio, and everyone speeds like crazy on every road. Gas cost more too.
Most people here in California put the vast majority of their mileage on simply commuting. Trip rationalization would do very little to reduce that use. Living closer to work would do the trick, but there isn’t enough housing close to the jobs for that to be feasible for everyone.
“Is the Hybrid Boom About to Go Bust?”
Is this a question from the new easier SAT test? It must be, because the answer is obviously no.
The US spends approximately $1 Billion dollars EVERY DAY importing crude oil and related commodities so that we can burn it up. Even in a world of crazy big numbers that is an insane amount of cash to spend on things we burn. Hybrid technology is one of the ways that can be cut back radically and it is going to continue to gain market share.
“According to mlive.com, auto industry analysts predict that the hybrid “premium” and consumer acceptance of $3 a gallon gas will dampen near-term demand for gas – electric vehicles. …”
If you really truely believe – it still wont be true.
Dynamic88 :
“According to mlive.com, auto industry analysts predict that the hybrid “premium” and consumer acceptance of $3 a gallon gas will dampen near-term demand for gas – electric vehicles. …”
If you really truely believe – it still wont be true.
Now THAT made me laugh! He’s right, you know. Detroit is a great example…
While I don’t agree with the conclusion that hybrid boom is about to go bust, I’ll stick by the assertion that it is a political/social statement not an economic decision that drives people to buy hybrids. Comparing a Prius to a Corolla with the same features, it would take 21.4 years for the gas savings to equal the difference in price assuming a 15% annual increase in gas prices, 12,000 miles per year driven, and a 3.5% (conservative) return on investment if the price difference were invested instead of used to buy the Prius instead of the Corolla. The number of years to break even is inversely proportional tot he number of miles driven; so, if you put 24,000 miles on your vehicle each year, then you will break even in 10.7 years (256,800 miles is the break even point).
Another way to look at it is what if I get a 3 year car loan with zero down. In this scenario, I will have $3,655.27 more in my wallet at the end of 3 years buying a Corolla instead of a Prius, once again assuming 12,000 miles per year and a 15% annual increase in gas prices. I still don’t see an obvious economic advantage to a hybrid, unless you are comparing it to a car that gets 10 mpg, but that’s really not a fair comparison. Compare it to a small fuel efficient vehicle like a Corolla, Civic, Mazda3, etc. and the Prius becomes a political/social statement.
(I used a Corolla because my mom owns a Corolla with auto, and I know what her real world mileage is. I used the 46 mpg figure cited in one of the early posts for the Prius.)
P.S. I also decided to compare the Prius to the Mazda6s that I own. I have been tracking the real world gas mileage I get from the Mazda, and it is 21 mpg since I bought it new in December 2004. I paid $17,500 for it plus tax and licensing. I guarantee you that the Mazda6s is a more enjoyable car to drive, and it would take 11.9 years for the gas savings from the Prius to make the Prius more economical, once again assuming 12,000 miles per year (which is what I average) and a 15% annual increase in gas prices (which we haven’t seen over the past 3 years since I bought the Mazda). The Mazda has ample trunk space, can haul four large people in comfort, and has twice the horsepower of the Prius with better handling to boot.
# ZoomZoom :
I am a former sports car owner. Don’t have any now, but I’m telling you, if Mazda, BMW, Mercedes, Toyota, or Honda ever thought to do a hybrid or otherwise very-high-milage version of a Miata or Z4 type of vehicle , I might just be convinced to get a second car again…
Buy a Honda Insight (manual transmission) – Porsche 356 of the 21st century (only better).
Lumbergh21 :
February 3rd, 2008 at 1:40 pm
I’ll stick by the assertion that it is a political/social statement not an economic decision that drives people to buy hybrids.
Well, I’ve read numerous posts on this site by people saying buying a Prius was an economic decison for them…. so, obviously, you’re wrong if you mean that statement to apply to everyone. No doubt there are many people who buy hybrids (especially a Prius) to make a statement – but what proportion of the total is just a guess, probably based on the prejudices of the person making the guess rather than any “facts”.
My guess is that the proportion of people buying a Prius to make a statement is probably not that much different from the proportion of people buying any car to make a statement. The luxury car industry is almost entirely based on buyers wanting to make a statement. Where I come from these are called “prestige” cars – pretty much says it all.
Buying a luxury car certainly makes no economic sense (unless appearing to be successful attracts people to your business). People pay more for the aura of luxury than they get in added value (I believe that Toyota entered the luxury market with Lexus because the profits are better than with “ordinary” cars).
For many people driving a truck is just a statement. (Responses welcome from truck owners for whom it makes practical sense.)
The car that anyone drives is capable of being a mobile advertisement of that person’s wealth, status, political views, youthful attitude, sexiness, style, power etc. etc. (even if it’s just a statement that they don’t want their car to be a statement).
Whether you consider a particular car to be value for money may depend on whether you agree with the statement that you believe it makes.
Lumbergh21 said:
I’ll stick by the assertion that it is a political/social statement not an economic decision that drives people to buy hybrids.
Not me.
Ghillie responded:
Well, I’ve read numerous posts on this site by people saying buying a Prius was an economic decison for them…. so, obviously, you’re wrong if you mean that statement to apply to everyone. No doubt there are many people who buy hybrids (especially a Prius) to make a statement – but what proportion of the total is just a guess, probably based on the prejudices of the person making the guess rather than any “facts”.
Right on.
Furthermore, it is a big mistake to assume that people who drive hybrids are of one particular political view or party, or that people who drive a hybrid automatically buy into the global warming religion.
Yet many people continue to make this superficial mistake every day.
By the way, I thought that the Insight was a great little car. Problems, however…
1. I couldn’t get a test drive without putting money down at a dealer and placing an order. What’s up with that?
2. The red and silver colors were nice, and later a blue one came out, but that bile-green was nasty, like yesterday’s chip-dip…
3. Honda’s IMA hybrid system did not allow for the gas engine to shut off at traffic lights when running the AC. I live in Florida; nuff said.
4. The Insight wasn’t available as a top-down roadster.
5. Honda no longer makes the Insight.
ZoomZoom :
February 3rd, 2008 at 11:53 pm
By the way, I thought that the Insight was a great little car. Problems, however…
1. I couldn’t get a test drive without putting money down at a dealer and placing an order. What’s up with that?
That seems stupid to me but now no longer relevant…. as you say – Insights are no longer available new.
2. The red and silver colors were nice, and later a blue one came out, but that bile-green was nasty, like yesterday’s chip-dip…
Well – I like the green but each to his own. Most Insights are silver, red or blue.
3. Honda’s IMA hybrid system did not allow for the gas engine to shut off at traffic lights when running the AC. I live in Florida; nuff said.
That is a pain, but with the AC in econ mode the gas engine will shut off at traffic lights and leave the fan running (but not the AC). You’ll still get reasonably cold air for a few minutes. But definitely not as convenient as a Prius.
4. The Insight wasn’t available as a top-down roadster.
Out with the angle grinder :) Or think of all the useful things you can carry under the rear hatch.
5. Honda no longer makes the Insight.
Buy used.
Whether or not these people believe that the Prius saves them money doesn’t change the hard numbers. I’ll admit the calculations I included in my first post are quick and dirty and don’t take into account the resale value of the respective cars or the time value of money, only estimated gasoline price inflation (and a rather high estimate at that)and a modest return on investment after taxes. However, anyone who plans on keeping a hybrid for 200,000+ miles before reselling it, shouldn’t expect much residual value. Maybe others won’t consider this, but the constant cycling of those batteries over those 200,000+ miles has got to have a serious effect on their current ability to store energy. I would look at buying an old hybrid the same as buying an old conventional car that was in need of a new engine since the cost of a new battery pack is as much or more than the cost of a rebuilt engine. Then you also have the fact that you have an old engine in their as well as all other systems, just like a conventional car. These issues should certainly effect the resale value of an old hybrid, and by the tiem you have paid for the extra purchase cost through gas savings, that is exactly what you will have, an old hybrid.
My point being that the cost of gas even at extremely high prices, $5+, is still small compared to the initial capital outlay in buying a car. If you buy a hybrid that gets 50% better gas mileage than a comparable conventionally driven car, you are still only saving a few hundred dollars each year. That might make you feel good, but it doesn’t make up for the intial additional capital outlay of several thousand dollars for quite some time; quite posssibly not even within the life time of the car.