Sat
Apr 7 2007
09:20 am

Earlier in the week there was news that Chrysler's sales were down 5% for March 2007 as compared to 2006. Then came the news that DamilierChrysler was under increasing pressure from shareholders to sell the division. Then it was revealed that Chrysler was indeed on the block, followed by news of a $4.5 billion offer. Shortly thereafter it was reported that 4300 Chrysler workers accepted buyouts in a voluntary reduction in force.

Another report from earlier in the week said that "Toyota's U.S. sales jumped 11.7 percent last month, boosted by record hybrid sales and strong overall car sales, while Ford's sales dropped 9 percent, DaimlerChrysler sank 4.1 percent and General Motors slid 4 percent." The report says that Ford still managed to hold down the #2 spot behind GM, with Toyota coming in a close third.

The same report also says: "In all, Toyota sold 242,675 light vehicles in the U.S., including 140,009 cars, up 19.4 percent from the same month a year ago, and 102,666 trucks, a 2.7 percent increase. So far this year, Toyota has sold 61,635 hybrids in the U.S., up 68 percent from the first three months of last year. That includes 28,453 hybrids last month."

Honda's sales were up as well, posting a 7.3% increase over March 2006 and setting a new record for Honda. Honda only sold 3,199 hybrid vehicles, though, "including 2,813 Civic Hybrids and 385 Accord Hybrids, a combined increase of 6.7 percent over year-ago results."

A report from GreenCarCongress.com says that "US sales of light-duty hybrid vehicles almost doubled in March 2007 from the year before, reaching 34,637 units—an increase of 94% from March 2006." Most of these were from Toyota, which dominates the hybrid market, with the Prius and Hybrid Camry accounting for 70% of hybrid sales in the U.S. Toyota's hybrid sales are up 68% for the calendar year so far. Honda Civic Hybrid sales were up 26%. Even Ford had a 50% increase in Escape/Mariner Hybrid sales.

Check out this graph (the dark blue line at the top represents 2007 hybrid sales as compared to previous years):


(Source: GreenCarCongress.com - click for larger view)

There's a message here somewhere. While waiting for the government and American auto manufacturers to do something about higher mileage vehicles, American auto buyers are voting with their pocket books and Japanese automakers are selling hybrids and other more efficient cars as fast as they can make them.

(At the same time, though, Toyota is attempting to redefine and take over the pickup market with the new Tundra, which gets EPA 15/18 MPG. And they are apparently selling. Toyota sold 13,196 of the redesigned Tundras in March 2007, an 11.8% increase over March 2006.)

I don't know if hybrids are the answer (we're happy with ours, and with our Ford Freestyle crossover that is more fuel efficient than the SUV it replaced), but bigger, heavier cars and trucks with lower gas mileage don't seem to be the answer for consumers or for American automakers any more. How long will it take them to figure this out? Congress should do American automakers a favor and mandate a dramatic increase in CAFE standards so we can finally move beyond the muscle car glory days when bigger and faster were better.

bizgrrl's picture

Yes, I wish Ford had done

Yes, I wish Ford had done more with hybrids. I would have been happy to stick with Ford if they had something comparable to the Prius or Civic. They should make a hybrid version of the Ford Focus line.

Sven's picture

It's the

It's the unions/treehuggers/nannystaters/pensioners fault, natch.

Sven's picture

Here's a new hobby for you,

Here's a new hobby for you, SKB.

CBT's picture

An example that answers are

An example that answers are found in the marketplace, not in the halls of Congress. Consumers obviously want high mileage hybrids. Manufacturers will make what sells, particularly that which sells at a higher profit. Tax credits may have also played a part role. Anyone know when those tax credits were approved by Congress and which President signed them into law?

Rachel's picture

Hmm, that's interesting. I

Most owners of hybrids also own SUVs or luxury vehicles that get poor fuel usage ratings.

Hmm, that's interesting. I only know 4 other hybrid drivers personally and although some of them own other vehicles, none qualify as SUVs or luxury vehicles.

Rachel's picture

Oh well, I guess driving one

Oh well, I guess driving one SUV and one hybrid is better than driving two SUVs.

I think there might be a 4th reason - economics. Yes, the hybrid costs more up front. But it saves a lot of gas $$ in the long run. We also bought ours when we were able to take a big tax credit.

So in our case, I think we were motivated primarily by environmentalism and economics.

redmondkr's picture

Anyone know when those tax

Anyone know when those tax credits were approved by Congress and which President signed them into law?

The same administration that proposed an increase in the tax credit for buying a Hummer in 2003.

In 2003, the Bush administration proposed increasing the tax deduction to $75,000. Lawmakers responded by expanding it to a whopping $100,000 as part of the $350 million tax cut package. Yet Congress did not change the weight-based classification of the vehicles, creating a huge benefit for the largest, least efficient vehicles.


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CBT's picture

So, President Clinton

So, President Clinton approved the initial heavy vehicle tax break ($25,000) and the Republican Congress and Bush expanded it ($100,000) to cover more service vehicles. Bush also helped hybrid car buyers (likely to be consumers, not businesses). The Republican Congress later closed the 'loophole' back to the Clinton approved tax credit.

Number9's picture

Oh no you didn't...

So, President Clinton approved the initial heavy vehicle tax break ($25,000) and the Republican Congress and Bush expanded it ($100,000) to cover more service vehicles. Bush also helped hybrid car buyers (likely to be consumers, not businesses). The Republican Congress later closed the 'loophole' back to the Clinton approved tax credit.

Your lack of progessivity disturbs me.

Opinari's picture

"I don't know if hybrids are

"I don't know if hybrids are the answer (we're happy with ours, and with our Ford Freestyle crossover that is more fuel efficient than the SUV it replaced)..."

Question for you... what kind of horsepower do you get with the hybrid relative to what you got with the previous SUV?

R. Neal's picture

Question for you... what

Question for you... what kind of horsepower do you get with the hybrid relative to what you got with the previous SUV?

Interesting question. Depends on which SUV.

Here's our progression:

1992 Ford Explorer XLT V6 --> 2006 Ford Freestyle Limited V6

2004 Ford Explorer Eddie Bauer V8 --> 2007 Toyota Prius

The 92 Explorer had, I believe, a 155HP V6. The Freestyle that replaced it has a 203HP V6.

The 04 Explorer had a 239HP V8. The Toyota Prius that replaced it has a net system output of 110 HP (or 82kW, which is apparently the new geek way of expressing power), derived from a 76HP 4cyl gas engine and a 67HP electric motor.

So, we went from 394HP to 313HP net.

But it's more complicated than that. We hardly ever drove the V8 Explorer once we got the Freestyle. Before that, we never drove the V6 Explorer after we got the V8 Explorer.

(There were other variations of V6 Explorers, a BMW 5 series, and three or four Nissan Z cars in between that we drove instead of the 92, which only had about 66K miles on it when we traded it in 2006.)

Now, it looks like the Freestyle will be parked in the driveway most of the time except for business/long road trips with lots of junk. It appears most of our everyday driving will be in the Prius.

So, to answer your question (are you still with me?) most recently (since 04) we've gone from 239HP, to 203HP, to 110HP for most everyday driving. So far, I haven't missed the extra 93 or 129 HP. But then again, I'm getting old.

Opinari's picture

Thanks for the info. I'd be

Thanks for the info. I'd be more than willing to acquire a hybrid if the tradeoff for HP vs. mileage wasn't so substantial. I've been holding out actually for the technology to advance a little more.

Honestly, I'm just tired of subsidizing the livelihood of the Middle Eastern theocracies. Eventually, I'll either buy a hybrid, or at least a vehicle that can run E85. Fortunately, here in TX, E85 stations are starting to pop up. Anyway, the jury's still out on this one for me.

Up Goose Creek's picture

Value

" Consumers obviously want high mileage hybrids. Manufacturers will make what sells, particularly that which sells at a higher profit"

There's the dilemma. Often buyers who are frugal about MPG are also frugal about price as well. Not a good target market.

_______________________________
Less is the new More - Karrie Jacobs

cafkia's picture

CBT

Would it not be a reasonable interpretation of your comment that you in no way believe that congress or the rest of government can be considered leaders? It would also appear that you would consider it wrong for the corporations to take a moral leadership position and use their marketing departments to push products that are environmentally responsible.

Tell me, what childhood trauma did you suffer that caused your aberrant belief structure?

CAFKIA

----------------------------------------------------------- 

It is impossible to defeat an ignorant man in argument.
  - William G. McAdoo

gttim's picture

LOL!

So, President Clinton....

Is there anything wingnuts cannot try and blame on Clinton....

The technology is there for US made hybrids. It is getting better. GM killed its electric car and refused to let the people who had leased them buy them at the end of the lease. US automakers are just committing slow suicide by making huge, gas guzzling vehicles. Let them. No government bailouts. Let the free market decide. Maybe, one of the companies will figure it out. Probably not, however.

Sven's picture

Hey, it sounds like you saw

Hey, it sounds like you saw "Who Killed the Electric Car?" I found the part about how GM made its ads for the EV-1 intentionally dark, dismal and creepy particularly interesting.

Photo Sharing and Video Hosting at Photobucket

They're pretty darn good at trashing alternatives to the good ol' motor car.

Photo Sharing and Video Hosting at Photobucket

Factchecker's picture

Prius envy

I was going to ask you whether you missed the power, skb. Every car I've ever owned has been slow, except maybe the one I drive now. I also have a light foot. Pretty much the same goes for my wife. Yet we were both concerned about the acceleration of the Prius meeting our needs, mostly in terms of safety. But I still kinda want one.

Yes, I wish Ford had done more with hybrids. I would have been happy to stick with Ford if they had something comparable to the Prius or Civic. They should make a hybrid version of the Ford Focus line.

Reading this post earlier, it reminded me that I would be interested in the Ford Escape, with its Toyota licensed Synergy system, if it only had stability control, or at least traction control. Wouldn't want an SUV without it. So I check the Ford site hoping they might have a new Escape in the works. Lo and behold, there's a new '08 Escape and it's out right now! But still no stability control!!

Are these bozos in control of the American Big 2 (or 2-1/2 or 3) just totally tone deaf to the market?

R. Neal's picture

More on the interesting

More on the interesting horsepower discussion...

Our first cars were Datsun 510s. One of the greatest cars ever made. They were cheap and reliable. You could buy one used in decent shape for $500-$600 and you could work on it yourself.

We drove those things for years. The stock motor was a 1.6L that got a whopping 96HP and 100FP of torque. Yet with a four speed it would scoot pretty good and handled like a sports car.

I'm sure it got good mileage, but I have no idea what it was. I do remember that back during the gas price wars you could put 50 cents worth of gas in it which would get you two gallons, and you could go to the mountains and back.

There was all kinds of aftermarket stuff to trick them up. They were a favorite of SCCA slalom races (like they used to have out at Chilhowee Park). I even remember seeing one in the 24 Hours of Daytona sports car race in the GT class. The Motors were interchangeable with the 2000 sports car and others (the last one we owned was a 1972 model that had the 2000 2L sports car motor and some "extras" like upgraded interior, tachometer, etc. I think we paid $1500 for it used. It was an awesome little car, may have been some sort of special edition.)

Some power to weight ratios:

Datsun 510
96 HP
100 FP torque
2000 Lbs
20/1 power ratio

Ford Freestyle FWD
203 HP
207 FP torque
3649 Lbs
18/1 power ratio

Toyota Prius
110 HP
82 FP torque
2932 Lbs
26/1 power ratio

The not so great acceleration of the Prius (0-60 10.5 secs.) makes you wonder about the 26/1 power ratio. It's probably how it is distributed throughout the power curve. At highway speeds It seems to easily accelerate from 50 to 80, and in fact I have a hard time keeping under most speed limits once you get it rolling.

As for the pricing of hybrids and the so-called premium, yes, they do cost more. But they are not out of reach for most new car buyers and in fact there isn't that much of a premium any more, especially with the tax credits.

Here are some comparisons of of similarly equipped models (which is a little complicated because the hybrids generally come with more features/options standard):

Honda Civic:
LX: $21,107
Hybrid: $23,893
Hybrid tax credit: $2100
Net hybrid cost: $21,793
Hybrid premium: $686

Toyota Camry:
XLE: $24,900
Hybrid: $26,200
Hybrid tax credit: $650
Net hybrid cost: $25,550
Hybrid premium: $650

Ford Escape:
XLT: $22,830
Hybrid: $25,740
Hybrid tax credit: $3000
Net hybrid cost: $22,740
Hybrid premium: -$90

You can't do a fair comparison on the Prius because it only comes in hybrid. It's probably somewhere in between the Corolla and the Camry in terms of size, comfort and features, and so is the price.

Andy Axel's picture

An example that answers are

An example that answers are found in the marketplace, not in the halls of Congress. Consumers obviously want high mileage hybrids. Manufacturers will make what sells, particularly that which sells at a higher profit.

So, whom can we can thank $3/gal gas and rapacious quarterly earnings on the part of oil companies?

____________________________

People getting rich. Some people saying "Markets!" More death. Neil Young. Death.

CBT's picture

"It would also appear that

"It would also appear that you would consider it wrong for the corporations to take a moral leadership position and use their marketing departments to push products that are environmentally responsible."

Steve, most companies need to be concerned with making a buck. It's obvious with hybrids they can make a buck and puch a positive product. A win-win. My point was companies don't have to wait or depend on the government to set the policy.

And no, I wasn't 'blaming' anything on Clinton. Liberals too often blame Bush for every conceivable problem. The tax credits for Hummers 'loophole' (it was aimed at small businesses, not Hummers) was thrown out there. I simply pointed out that was a law passed under Clinton (good for him).

I'm not surprised at the common hybrid demographic. The average joe is starting to hear about hybrids, but most probably still think they are 'experimental'. That's changing. Plus, hybrids are no longer tiny cars with tiny power. We have mid-size cars and small SUV's. That will generate appeal to folks who might never have considered a hybrid.

rikki's picture

that dogma won't hunt

My point was companies don't have to wait or depend on the government to set the policy.

That would be a more interesting point if it were relevant, but the fact of the matter is current policies distort the automobile and gasoline markets substantially. If you want to promote free markets instead of the status quo, you should be advocating lower government spending on roads and sewers, an end to socialized pollution and about a dozen other reforms that are needed before a true market signal can penetrate existing policy.

Factchecker's picture

My point was companies don't

My point was companies don't have to wait or depend on the government to set the policy.

They do all the time. Look at the subsidies to the oil & gas and nuclear power industry just to start with. Got any problem with that?

CBT's picture

"They do..." Nuclear Power

"They do..."

Nuclear Power v. cars...apples and oranges. Depending on the specific subsidy, yes I might have a problem with it.

CBT's picture

Slight correction...one

Slight correction...one point of my earlier post was that the Republican congress and Bush were the ones who did pass the hybrid tax credits. One response was it 'was the same one who passed the "Hummer" loophole'. That is only a half-truth. That loophole was actually passed under Clinton.

bizgrrl's picture

I was going to ask you

I was going to ask you whether you missed the power, skb. Every car I've ever owned has been slow, except maybe the one I drive now.

Except for the roominess of the Explorers, I think our preference has always been handling, not necessarily power. The Datsun 510s were great fun as were the Z cars. The BMW handled pretty awesome as well. The Explorer (and Central Florida) teaches you to slow down. The Prius doesn't handle like a 510, Z car, or BMW, but since we already know how to drive something that doesn't grip the road like a sports car, so what. Nascar is okay, IMSA racing is great!

Factchecker's picture

What was wrong with Gerald

What was wrong with Gerald Ford of Michigan in his support of CAFE improvements? If we'd continued along that trend, we'd be a lot better off in many respects and so would Ford and GM. We would be a lot less dependent on foreign oil (maybe independent by now!) and would have sent billions less to unstable regimes that profit off oil. And tensions could be less, like the type that led to 9/11. We'd have cleaner air too.

Factchecker's picture

our preference has always

our preference has always been handling, not necessarily power.

Mine too. Over 16 yrs. I owned just a Fiat and later an Alfa. I had a second Fiat for a little while, a '73 124 Spider, as a pleasure car. I did this for a little while in my X1/9, albeit poorly. Even my 5 series I have now is rated at under 200hp. But it's fast to me.

Factchecker's picture

Nuclear Power v.

Nuclear Power v. cars...apples and oranges.

I can't resist. Should nuclear power be subsidized? The technology is not new, like solar and wind, which could use a boost to help establish their economies of scale.

Can't the power source that was once said to be too cheap to meter compete in the free market, even after 50 years?

gttim's picture

One more time!

CBT: That loophole was actually passed under Clinton.

C'mon, you can work that into a 4h post! You know you can. Then blame Clinton for Jesus dying. It is Easter, after all.

Reagarding the price of hybrids, if the manufacturers had been making them since the 1973 gas shortages, the price would be very low right now. Remember this is new technology and the R&D is what is driving costs up. If the US had decided during the 70's that we were going to get off the Mid East oil tit,and become energy self sufficient, we would be. Other countries did. But the GOP, which appears to be run by the oil companies, decided not to, and we didn't. Electric cars could be very cheap now if the technology had been pursued, and perhaps could be built with solar cells on the body surfaces to help recharge whenever the sun is out.

Factchecker's picture

...makes you wonder about

...makes you wonder about the 26/1 power ratio. It's probably how it is distributed throughout the power curve.

I think that's exactly right. Though with the Prius, you'd think the power off the line (w/ motors at full torque) would be great. That may actually be true up to about 10mph or so.

My X1/9 was one of the quicker ones, because it was fuel injected. But at 75hp and about 2400lbs (guessing from memory) its wt./pwr ratio was 32! It was heavy for safety and rigidity (for handling) reasons. 0-60 was about 12 sec.

Factchecker's picture

Ethanol: It's the corn part that's folly

...a vehicle that can run E85. Fortunately, here in TX, E85 stations are starting to pop up. Anyway, the jury's still out on this one for me.

I actually agree with the kook in the N-S yesterday who wrote about how bad corn ethanol is. I think it's a pig in a poke too. Except that he just generalized and called it ethanol, while only describing corn ethanol. Then he went on to argue that there's plenty of oil in North America, if we could only extract is "using environmentally sensitive methods [from] hydrogen, nuclear, electric and wind."

(Dang. Maybe we need use some of this "electric" power to generate some of the electricity we use. Heh.)

E85 compatibility is nice, but only to be cellulosic ethanol ready. Then your car could use ethanol that could eventually become cheaper, more plentiful, and close to carbon neutral.

vsmith's picture

US auto makers

I buy or lease a new car every year. The last 10 have been MB or BMW. I looked at Cadillac last fall and the dealer add-ons to the sticker price were around $1200-1800 per car (pin stripes, etc). I emailed GM and said as bad as you need to move cars why is the dealer is doing this? (he did the same with his Buicks). GM said they were sorry but their dealers were independent and they had no control over pricing. Part two:

Why would you take your franchise mark (Camero) and put it on the sidelines for 4 or 5 years? Why would you drop the mark that a few years earlier had been the best selling car in the US (Taurus)? Part three:

GM and Ford are like large animals that have a dozen arrows in them - just a matter of time. Ten years from now - Toyota America (formerly GM) and Nissen America (fomerly Ford) are doing well.

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