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post #1 of 23 (permalink) Old 03-17-2009, 08:27 AM Thread Starter
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Hybrid sales plummet

This article is fantastic. I am kind of shocked that the LA Times would print it. It does a good job of illustrating why the government shouldn't be involved in the car business. The industry has sank billions of dollars into developing cars that no one is going to buy. What happens when automakers build this overpriced junk to meet government standards for fleet fuel economy and no one is there to buy it. That is the important part of the equation that the fools in Washington seem to miss...people don't HAVE to buy this shit.

http://www.latimes.com/business/la-f...,6682265.story

Hybrid car sales go from 60 to 0 at breakneck speed

The gas-electric vehicles are piling up on dealers' lots as anxiety over gasoline prices evaporates. But more hybrid models are on the way.

By Ken Bensinger
March 17, 2009

The Ford and Honda hybrids due out this month are among dozens planned for the coming years as automakers try to meet new fuel-efficiency standards and please politicians overseeing the industry's multibillion-dollar bailout.

Unfortunately for the automakers, hybrids are a tough sell these days.

Americans have cut back on buying vehicles of all types as the economy continues its slide. But the slowdown has been particularly brutal for hybrids, which use electricity and gasoline as power sources. They were the industry's darling just last summer, but sales have collapsed as consumers refuse to pay a premium for a fuel-efficient vehicle now that the average price of a gallon of gasoline nationally has slipped below $2.

"When gas prices came down, the priority of buying a hybrid fell off quite quickly," said Wes Brown, a partner at Los Angeles-based market research firm Iceology. "Yet even as consumer interest declined, the manufacturers have continued to pump them out."

Last month, only 15,144 hybrids sold nationwide, down almost two-thirds from April, when the segment's sales peaked and gas averaged $3.57 a gallon. That's far larger than the drop in industry sales for the period and scarcely a better showing than January, when hybrid sales were at their lowest since early 2005.

In July, U.S. Toyota dealers didn't have enough Prius models in stock to last two days, and many were charging thousands of dollars above sticker price for the few they had.

Today there are about 80 days' worth on hand, and dealers are working much harder -- even with the help of $500 factory rebates -- to move the egg-shaped gas-savers off lots from Santa Monica to Miami.

This month, Honda is offering $2,000 in cash, financing and leasing incentives to buyers of the formerly sold-out Civic hybrid, while a dealer in northern Michigan is dangling $6,000 cash back to those willing to buy a hulking Chevy Tahoe hybrid.

Yet automakers believe they have little choice but to make more hybrids. Though car buyers are losing interest, politicians are pushing them as key to reducing U.S. dependence on foreign oil and limiting the global-warming gases that cars emit into the atmosphere.

In January, President Obama called on the industry to "thrive by building the cars of tomorrow" and prepare for federal and state regulations that could push average fuel economy above 40 miles per gallon by 2020.

"The automakers are in the situation of needing to pacify politicians that are in the position to bail them out with expensive fuel-efficient cars," said Rebecca Lindland, auto analyst with IHS Global Insight. "But shouldn't it be more about satisfying the needs of the American consumer?"

Dubbed the Prius-fighter because of its similar looks and performance, the new Honda Insight hybrid is set to arrive on dealer lots in the next few weeks. Next year, the Japanese automaker will make a sporty hybrid coupe. Hyundai and Audi will deliver their first hybrids in 2010, and Toyota has a redesigned Prius and a new Lexus hybrid coming this spring. Toyota said Friday that it would make a subcompact hybrid priced below $20,000 in 2011.

The biggest push is coming from Detroit. Ford plans to follow its new 41-mile-per-gallon Fusion and Mercury Milan hybrids with a battery-powered van in 2010 and a "family" of hybrids by 2012. And last month, in their request to the Obama administration for $21.6 billion in additional bailout cash, both General Motors and Chrysler announced a hybrid onslaught.

Chrysler promised eight new hybrids or electric vehicles by 2015, and GM, which already sells eight hybrids, said 26 of the 33 cars it sells in 2015 won't run on gas alone, including the Chevrolet Volt, a plug-in hybrid due out next year.

The hybrid flood marks a lasting commitment to a powertrain technology that currently represents only about 2% of U.S. vehicle sales and, by most accounts, is deeply unprofitable.

Toyota said last year that it was finally making money on the Prius after nearly a decade producing it, but executives at other automakers acknowledge that they lose money on every hybrid sold. "If we were making money on the Civic hybrid, we weren't making a lot," Honda spokesman Chris Martin said.

That may help explain why fewer than 2 of every 100 Chevy Malibus sold last month had the hybrid powertrain and why Ford priced its new hybrid Fusion, which dealers expect to start receiving this month, $8,000 above the gasoline-only version.

Ford expects to produce about 20,000 Fusion and Milan hybrids this year, or about 1% of its total production.

"It's a tough time to bring out almost any product right now," said George Pipas, the company's chief sales analyst. "But getting hybrids out right now is as much about image as anything else."

In November, months before Honda even announced the price of its new Insight, Jim Johnson of Eagan, Minn., plunked down a $500 deposit for one.

"I asked to be on the waiting list, and the salesman said he didn't have one," said Johnson, who works in investments. "So I said, 'OK, I want you to start a waiting list.' "

As evident on the streets of cities such as Los Angeles and San Francisco, hybrids have an almost cult-like following, but getting the masses to buy them with any consistency is another matter. In their zeal to meet what seemed an insatiable appetite for hybrids in the middle of last year, carmakers may have gone too far, said IHS Global Insight's Lindland.

At the end of June, AutoNation, the country's largest chain of new-car dealerships, had only a two-day supply of Honda Civic hybrids and a 14-day supply of the non-hybrid Civic. By year's end, the picture had flipped, with AutoNation holding 107 days' worth of regular Civics, compared with 148 days' stock of the hybrid version.

In December, Toyota terminated plans to build the Prius in a $1.3-billion plant it had built in Mississippi, and Chrysler closed its only hybrid-producing factory.

"The price of gasoline dictates what people buy," AutoNation Chief Executive Mike Jackson said. "Gas fell to $2, and now my lots are filled up with fuel-efficient cars that aren't moving."

Consumers who do buy these days tend to focus more on present-day arithmetic than long-term commodity speculation.

Three weeks ago, Jerome Haig, a lawyer in Torrance, put down a $500 deposit on a Fusion hybrid, even though he hasn't even test-driven one because they have yet to hit lots. "I do like the idea of getting a hybrid," Haig said.

But he concedes that he might not have considered the car had it not been for a $3,400 tax credit on Ford hybrids and a deduction on new-car sales tax. The latter was part of the $787-billion federal stimulus package. "The tax advantages are a pretty big incentive."

A sales-tax deduction does little to move vehicles like the $74,085 Cadillac Escalade hybrid or the Lexus LS600h, which starts at $105,885. Neither gets better than 21 mpg, and buyers pay a premium over similar gasoline-only vehicles that would take decades for owners to equal in fuel savings even if gas hit $5 a gallon. So far this year, only 415 of the pair have sold nationwide.

Still, some consumers see the depressed hybrid market as a buying opportunity.

Chad Gallagher, a lawyer in Berkeley, took advantage of a Presidents Day promotion, plus a healthy measure of dealer desperation, to buy a fully loaded Prius last month for $5,000 under sticker price.

"We got the touring package, leather seats, navigation, Bluetooth, everything," Gallagher said.

"I think they were just happy to sell the thing."
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post #2 of 23 (permalink) Old 03-17-2009, 08:29 AM
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Beautiful!

And a solid reason for the CAFE standards to evaporate. Let the market drive the bus.

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post #3 of 23 (permalink) Old 03-17-2009, 08:34 AM
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they will get sold as soon as the price of gas skyrockets again!

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post #4 of 23 (permalink) Old 03-17-2009, 08:35 AM
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Beautiful!

And a solid reason for the CAFE standards to evaporate. Let the market drive the bus.
Amen!

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post #5 of 23 (permalink) Old 03-17-2009, 08:39 AM
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they will get sold as soon as the price of gas skyrockets again!
Which the Gubment is trying EVERYTHING they can to make happen.

They are just pushing their agenda.

Hurry up mid-term elections!
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post #6 of 23 (permalink) Old 03-17-2009, 08:45 AM
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lets raise gas prices to sell more hybrids!

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post #7 of 23 (permalink) Old 03-17-2009, 08:55 AM
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lets raise gas prices to sell more hybrids!
That is their marketing scheme no doubt

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post #8 of 23 (permalink) Old 03-17-2009, 09:32 AM Thread Starter
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lets raise gas prices to sell more hybrids!
This is exactly what the Dems will try to do. It is part of their environmental agenda.
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post #9 of 23 (permalink) Old 03-17-2009, 09:39 AM
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"The hybrid flood marks a lasting commitment to a powertrain technology that currently represents only about 2% of U.S. vehicle sales and, by most accounts, is deeply unprofitable.

Toyota said last year that it was finally making money on the Prius after nearly a decade producing it, but executives at other automakers acknowledge that they lose money on every hybrid sold. "If we were making money on the Civic hybrid, we weren't making a lot," Honda spokesman Chris Martin said.

That may help explain why fewer than 2 of every 100 Chevy Malibus sold last month had the hybrid powertrain and why Ford priced its new hybrid Fusion, which dealers expect to start receiving this month, $8,000 above the gasoline-only version."

^All you need to know. How are hybrids going to save auto manufacturers?
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post #10 of 23 (permalink) Old 03-17-2009, 09:44 AM Thread Starter
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So what happens when the car companies have to produce tons of hybrids to meet fleet economy requirements but no one buys them? The prices of the cars they do sell have to go up in order to support the low prices required to move the hybrids.

Then we have a situation where people who don't want to drive a hybrid are indirectly forced to support the Democrats horseshit "green" agenda. Either that or the car companies go bankrupt.
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post #11 of 23 (permalink) Old 03-17-2009, 09:44 AM
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The gov will see this as a great reason to somehow make oil/ gas skyrocket again in efforts to push their agenda.
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post #12 of 23 (permalink) Old 03-17-2009, 09:54 AM
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If you listen to some the best car to get is a straight deisel/gas motor that makes good gas mileage.

Supposedly there is a lot of environmental harm with the create of hybrids. (batteries...etc)

Also, startup cost is higher and then maintenance is supposedly an ass whoop down the line.

"Hybrid" tech has some maturing to do before I even think about considering it.

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post #13 of 23 (permalink) Old 03-17-2009, 10:46 AM
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So what happens when the car companies have to produce tons of hybrids to meet fleet economy requirements but no one buys them? The prices of the cars they do sell have to go up in order to support the low prices required to move the hybrids.

Then we have a situation where people who don't want to drive a hybrid are indirectly forced to support the Democrats horseshit "green" agenda. Either that or the car companies go bankrupt.
Which is why they should create motorcycle division to offset the mileage. They are producing stuff that no one wants to buy. Car companies begin to fold, government nationalizes them, forces the car companies to produce what the government wants on the road - consumer be damned - and then they subsidize it.

So in the end, we have limited choices, have to pay more for them and our taxes increase so the government can afford to force us to buy cars we hate.

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post #14 of 23 (permalink) Old 03-17-2009, 11:26 AM
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Wow no one would have guessed that?

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post #15 of 23 (permalink) Old 03-17-2009, 11:47 AM
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The gov will see this as a great reason to somehow make oil/ gas skyrocket again in efforts to push their agenda.
Obama has already said the price of energy in America is too cheap, and that it will go up in cost.

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post #16 of 23 (permalink) Old 03-17-2009, 11:54 AM
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Obama has already said the price of energy in America is too cheap, and that it will go up in cost.

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Wtf... why would he make a statement like that. People can't afford this right now.
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post #17 of 23 (permalink) Old 03-17-2009, 11:57 AM
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If you listen to some the best car to get is a straight deisel/gas motor that makes good gas mileage.

Supposedly there is a lot of environmental harm with the create of hybrids. (batteries...etc)

Also, startup cost is higher and then maintenance is supposedly an ass whoop down the line.

"Hybrid" tech has some maturing to do before I even think about considering it.
If anyone really beleives the environmental impact, you are trading your normal emmisions for zero emmisions and a battery that will be disposed of.

It does cost more upfront, but not as much as in the past, making it more practical in this 3rd generation coming out this year.

All Hybrids have a much longer warranty on all hybrid components to allow you to drive it long enough to save money without getting into all the expensive upkeep.

This new Fusion coming out lets you drive up to 47 mph on pure battery. It also boasts 41 mpg. This is getting practical.

I had to sell the Escape hybrid when it first came out. Only tree huggers and businesses bought them. I just walked people straight to the gas four cylinder and explained how much they'll save.

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post #18 of 23 (permalink) Old 03-17-2009, 12:00 PM
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I'm so sad our normal consumer can't see except what's directly infront of them. Everyone knows the $4 per gallon was artificial, and so is our current price. It will stabilize between the two probably around $2.50 per gallon. You think the gas scare would still be in people's minds. Can't beleive everything faded already. Kind of like all Obama's promises the media has already forgotten about.

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post #19 of 23 (permalink) Old 03-17-2009, 12:03 PM
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Wtf... why would he make a statement like that. People can't afford this right now.
He did it to justify killing off coal-based power plants and the increased cost of electricity (because of the implementation of 'green electricity production) and gasoline and diesel (due to tighter restrictions on oil drilling/refining)

Basically, justifying himself.

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post #20 of 23 (permalink) Old 03-17-2009, 12:03 PM
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I buy a hybrid when I finally see a 2006+ Civic Hybrid for under $12k...
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post #21 of 23 (permalink) Old 03-17-2009, 12:05 PM
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Because they're a fucking joke, my gf didn't believe me when I told her the hybrid tahoes/escalades only get 21mpg. We went to the Fort Worth Autoshow, and they had a gas one, and hybrid one, I told her to go check the mileage ratings on them(20 for the gas, 21 for the hybrid), she came back and didn't see the point of even buying one, and she's more towards the environmentalist side.

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post #22 of 23 (permalink) Old 03-17-2009, 12:26 PM
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I see T. Boone Pickens buying up a ton, driving oil prices up and then selling them, shorting oil and doing it all over again.

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post #23 of 23 (permalink) Old 03-17-2009, 12:54 PM
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As soon as the economy picks back up gas will shoot back up to $4-5 gallon again. The reason? No investment in oil exploration while oil prices are down, and speculation that will occur once again.

Meanwhile we keep pumping oil out of existing fields, running them down. And obama and his crew want higher energy prices; rahm emanual has been quoted as saying that energy prices are "too cheap". And, obama has rescinded bush's new policy to allow offshore drilling.

The democrats have a "green" agenda, and they intend to make it happen come hell or high water. Add in a cap and trade system and energy is going to become almost unaffordable for most people. They apparently don't care about people that will have to choose between buying gas and buying food, or businesses that will have to close because of high energy costs.

Meanwhile, from a price/value perspective most hybrids simply don't make sense right now. Some are getting closer, but they still have a long way to go.
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