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February 08, 2005
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J.D. Power and
Associates Hybrid Car Forecast
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If you follow hybrid
cars, then you know one of the most cited hybrid analysts
comes from J.D. Power, and his study is used in almost every
hybrid vehicle market forecast.
Anthony Pratt, senior manager of global powertrain forecasting
at J.D. Power-LMC, has stated for many months that hybrids will
top out at 3 percent of the U.S. market by 2010, or roughly
535,000 vehicles.
Mr. Pratt typically starts out by noting how few hybrids have
been sold, just 88,000 in 2004. Of course, Mr. Pratt doesn't
mention that demand in 2004 has significantly out-weighed
supply, nor does Mr. Pratt acknowledge the momentum gained by
the technology behind the current Toyota
Prius, Hybrid Synergy Drive.
Sales for next year, Mr. Pratt predicts will hit 200,000, or
almost 1 percent of the market.
Toyota will easily move 100,000 Prius next year, and there are
already more than 11,000 pre-orders for its Lexus
RX400h hybrid SUV, the world's first luxury SUV.
| Hybrid
Car Tax Credit |
One-time
$2000.00 credit available
If
you purchase a hybrid vehicle in 2005, you might qualify
for a one-time federal income tax credit .
Sadly,
this tax-credit will be reduced in 2006, and phased-out
the following year under current legislation (more)
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Toyota Prius
+ Prius
hybrid home
+ Escape
hybrid home
+ Accord
hybrid home
+ Head
to head: Prius and the Escape hybrid match up
+ Prius
test drive
+ Escape
hybrid test drive
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The
Lexus RX400h will be the hottest luxury vehicle on the market
because you can be rich and still care! But seriously, early
reports on this vehicle are glowing, and it is sure to win many
awards. Forget the cost of the Lexus SUV hybrid. A few extra
grand for the Best Lexus SUV won't mean much to Lexus customers.
Then there is the
Toyota
Highlander hybrid. The Highlander hybrid has one of the
sleekest, aerodynamic SUV designs and it will be powerful - even
faster than the conventional Highlander - yet 30 percent more
fuel efficient and significantly cleaner, producing far less
pollutants.
Interest in this vehicle is phenomenal. Many potential
consumers, and there are well over a 100,000 interested
customers, believe they can now have their cake and eat it too.
Not only can they have an SUV, but they can have piece of mind
as well. Guiltless SUV style and performance, at a reasonable
cost, is what the Highlander hybrid will offer these consumers.
Just those 3 hybrids alone could move more than 200,000
vehicles.
Whether Toyota can produce 200,000 hybrids next year is the real
question. Additionally, since the Highlander hybrid might not
hit the streets until mid-year, its prospects might also be
limited.
And, I haven't even yet mentioned the Ford
Escape hybrid, the
Honda Accord hybrid, and the Civic
hybrid - at least another 40,000 - 50,000 units.
And in 2010, Mr. Pratt thinks there will be 30 - that's right 30
- hybrid vehicles on the market. But this is insignificant, Mr.
Pratt seems to believe, because efficient gas engines and diesel
engines will challenge hybrids.
To that argument, Toyota has already stated that any advance in
diesel or gas engines can also be utilized in hybrids. So, if an
advanced gasoline engine can increase fuel economy by 20
percent, then a hybrid vehicle with a new gasoline engine can
increase fuel economy by 50 percent.
Ultimately, Pratt's trump card is cost. Pratt claims that at
$3000 - 4000 above the cost of their conventional cousins is too
high for hybrids to be competitive.
Yet, buyers have been know to pay for better performance,
particularly faster and quicker cars, which is exactly what the
new generation of hybrids offer.
Perhaps the most important reason to believe that hybrids will
achieve more than 3% of U.S. sales is Toyota, the most
dominating and profitable car maker in the world.
Ford has stated that it envisions hybrids as an integral part of
the future. Chrysler has been relatively quiet, and Honda is
well positioned in hybrids offering the Insight, the Civic
hybrid, and the Accord hybrid.
Those car companies, especially GM and Nissan, with the most to
lose if hybrids become popular, are the biggest naysayers. Of
course, these car companies have no choice but to be bearish on
hybrids at this point in time.
Toyota, on the other hand, has the most to gain from hybrids and
the most power to push them. With it's Hybrid Synergy Drive
already used by Ford in the Escape hybrid (and other models
soon), its Synergy Drive will also be used by Nissan and Subaru,
and every one of those licensing deals makes Toyota's hybrid
drive more cost-effective for Toyota, while putting more
pressure on competitors.
Typically, in the long run, the best technology wins. Hybrid
technology is the best auto technology available, but it is an
emerging technology and it will advance. Just one major
development in NiMH batteries could instantly make conventional
automobiles almost obsolete.
Additionally, a vehicle like the Prius might just one day
transition from gas-electric hybrid, to fuel cell-electric
hybrid.
More important, the world has become a dangerous place over the
last few decades because of one resource, oil. Americans might
not know this, or believe it, but terrorists certainly do.
Additionally, demand is rising and will continue to rise. To
continue to be reliant on a resource with so many costs in terms
of the environment and military protection is simply foolish.
Don't believe me? Even the ex-CIA director, James Woolsey,
promotes hybrids because of the dangers of oil dependency.
Mr. Pratt and J.D. Power, on the other hand, aren't concerned
about oil dangers, just continued advertising dollars from
inefficient automakers.
In conclusion; however, I think American consumers are truly
beginning to question oil dependency, especially foreign-oil
dependency. If not for oil, there is no way the U.S. would ever
have become involved in Iraq, where, ultimately, 100s of
billions of dollars are being spent to secure foreign oil.
If that hidden cost of gasoline were added to the cost of
gas-guzzlers, hybrids would sure look a lot cheaper.
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