LEADING INDICATORS: Hybrids cost more to buy, operate

[mjd1001]

http://www.freep.com/money/business/...e_20050611.htm

Should not be a surprise, but a lot of people don't realize this:

LEADING INDICATORS: Hybrids cost more to buy, operate

Autos
No doubt about it. Hybrid cars and trucks are hot. Going farther on a gallon of gas not only seems like a smart financial move in an era of $2-a-gallon gas, but you feel like you're doing your part to save the environment, too.

But will that popularity endure as the financial reality of hybrids becomes more clear: Lower fuel bills don't offset the extra cost of a gas-electric powertrain.

A new study by Edmunds.com, a California-based research company, shows that hybrids typically cost thousands more to buy, fix and run over a five-year period than comparable, conventionally powered vehicles.

The Ford Escape Hybrid, for example, costs $3,429 more to buy and run than an all-wheel-drive Ford Escape XLT. Gas would have to cost $5.60 a gallon, or you'd have to drive that hybrid 37,000 miles a year, to break even with the conventionally powered Escape.

The Toyota Prius costs $5,283 more than a Toyota Corolla LE. Gas would have to cost $10.10 a gallon or you'd have to drive the Prius more than 66,500 miles a year to break even with the Corolla.

Looking for a break-even proposition? Edmunds.com puts the total cost of a Prius at about that of a Toyota Camry LE. But are those truly comparable cars? Not in LI's opinion.

[JVal14]

Praise GOD, the truth is told! Now let's see how long it takes for this to make the mainstream press.

[drew770]

Oh No!
News that is not bashing GM!!!
I bet you won't here any of this on CNN or Newsweek or better yet Business Week.

[Infiniti Z350]

Originally Posted by drew770

Oh No!
News that is not bashing GM!!!
I bet you won't here any of this on CNN or Newsweek or better yet Business Week.

That's because common-sense stuff does not usually make national news.

[goblue]

Hybrids are emotionally hot, but there's never been a personal finance case for one. GM does this a lot though - they overcrunch the numbers. Vehicle purchases don't have to make sense to just engineers and accountants, they have to make sense to a wide swath of society, and there are plenty that will pay more than they need to for a not so logical reason. American purchasing habits seem to be based on that.

[moman]

Originally Posted by goblue

Hybrids are emotionally hot, but there's never been a personal finance case for one. GM does this a lot though - they overcrunch the numbers. Vehicle purchases don't have to make sense to just engineers and accountants, they have to make sense to a wide swath of society, and there are plenty that will pay more than they need to for a not so logical reason. American purchasing habits seem to be based on that.

Exactly, hence why America's driveways and mall parking lots are filled with 4x4 Suburbans.

Looking at trends, many of them sweep from California eastward. The SUV trend started there in the early 1990's, and the hybrid trend started there in 2002/2003. Regardless of the merits of the techonology, it will continue to gain market share, mainly at the expense of large SUVs. Never underestimate the willpower of the American consumer to buy the newest "gotta have" gadget. (I.E. flat panel TV, apple Ipod, Toyota Prius)

[mgescuro]

But that's not the point, is it???

It was considerably obvious to many people that a Hybrid was going to cost more to maintain. Unlike most Americans, I ran projected numbers. (I sort of had to for my Product Marketing class.) And my numbers were relatively similar to those indicated in teh article.

However... that isn't the point. THe Hybrid touches on people's "Emotional" button. People irrationally go buy something without really knowing what's behind it because they think it's better for them. THe trick is... to maintain that momentum. THat's why Toyota sells so many of those ugly things.

Why in the world does the iPod have 82% of the world's marketshare for MP3 players?? It's not the cheapest one. It doesn't have the longest battery life. It is not the most feature packed. It's the emotional button. It is the easiest to use. it is also the lightest. But those alone aren't enough to sell the iPod.

[plane]

Just maybe, GM is smarter than we give the General credit for. What about the GM hybrid buses? I'll wager that the numbers crunch on those puppies. Perhaps GM is holding back with BAS and two motor technology for the right moment? To stage the greatest automotive comeback in history?

[Infiniti Z350]

Originally Posted by plane

Just maybe, GM is smarter than we give the General credit for. What about the GM hybrid buses? I'll wager that the numbers crunch on those puppies. Perhaps GM is holding back with BAS and two motor technology for the right moment? To stage the greatest automotive comeback in history?

GM wouldn't be smart if they are holding back. Now is not the time to hold back with technology like this.

[gmhashope]

Originally Posted by plane

Just maybe, GM is smarter than we give the General credit for. What about the GM hybrid buses? I'll wager that the numbers crunch on those puppies. Perhaps GM is holding back with BAS and two motor technology for the right moment? To stage the greatest automotive comeback in history?

GM has the technology for diesel-hybrids and are developing gas-hybrids as all the advertisements in car magazines from a couple of months ago stated.

[gmhashope]

Originally Posted by mgescuro

However... that isn't the point. THe Hybrid touches on people's "Emotional" button. People irrationally go buy something without really knowing what's behind it because they think it's better for them. THe trick is... to maintain that momentum. THat's why Toyota sells so many of those ugly things.

Why in the world does the iPod have 82% of the world's marketshare for MP3 players?? It's not the cheapest one. It doesn't have the longest battery life. It is not the most feature packed. It's the emotional button. It is the easiest to use. it is also the lightest. But those alone aren't enough to sell the iPod.

I completely agree with that statement, everyone that buys a Prius feels good thinking they are saving the enviroment and themselves a lot of money but they're not actually saving money.

[goblue]

Originally Posted by gmhashope

I completely agree with that statement, everyone that buys a Prius feels good thinking they are saving the enviroment and themselves a lot of money but they're not actually saving money.

Exactly. GM is late to the party - but we're supposed to see a system that has excellent integration and performance very soon. The DCX-GM venture is totally enclosed in the tranny (sans batteries of course). Whats great about that is it could be an option on any vehicle the trans is used on. GM actually doesn't have that many automatic transmissions - so conceivably, they could scale up faster.

Just think how many vehicles could be full hybrids if they did the 4T40s and 4T60s, let alone the truck transmissions...

[moman]

Originally Posted by mgescuro

But that's not the point, is it???

However... that isn't the point. THe Hybrid touches on people's "Emotional" button. People irrationally go buy something without really knowing what's behind it because they think it's better for them. THe trick is... to maintain that momentum. THat's why Toyota sells so many of those ugly things.

Why in the world does the iPod have 82% of the world's marketshare for MP3 players?? It's not the cheapest one. It doesn't have the longest battery life. It is not the most feature packed. It's the emotional button. It is the easiest to use. it is also the lightest. But those alone aren't enough to sell the iPod.

I agree 100%. But isn't this the same thing that has been happening with SUV's for the past 10 years?

[gmhashope]

Originally Posted by moman

I agree 100%. But isn't this the same thing that has been happening with SUV's for the past 10 years?

Yea pretty much, everyone wanted to have a big tough, 4 wheel drive SUVs and didn't really need them but wanted them for the image. But I know there are the people that actually need 4 wheel drive (I've been to N Wisconsin and you def. need it in the winter) and the big SUV to carry themselves and their luggage, but a lot just want them for their image.

[chevynj]

Originally Posted by goblue

Exactly. GM is late to the party - but we're supposed to see a system that has excellent integration and performance very soon. The DCX-GM venture is totally enclosed in the tranny (sans batteries of course). Whats great about that is it could be an option on any vehicle the trans is used on. GM actually doesn't have that many automatic transmissions - so conceivably, they could scale up faster.

Just think how many vehicles could be full hybrids if they did the 4T40s and 4T60s, let alone the truck transmissions...

I wonder how big that battery really is, i would love to be able to have second row captain's chairs and the hybrid system on the new Tahoe.