The Toyota Prius New Year's Rush; Deduction Bias?

Are you planning to buy a new Toyota Prius hybrid car in 2006?

If you have been waiting for the New Year because the hybrid tax deduction for the Prius is bigger than in 2005, then you are not alone. There have been numerous reports of Prius buyers telling dealers to wait until 2006.

So, will this make it hard to buy a Prius in 2006?

Sometimes the beginning of the year can be a slow time for car sales, and this might have an effect on hybrid cars as well. Nonetheless, demand for the Prius has been, and continues to be, far greater than supply. Since the tax deduction for the Prius is both bigger in 2006 and capped, some Prius buyers will not qualify for the hybrid car tax deduction.

All this makes me wonder whether some hybrid vehicle buyers will look at other hybrids such as the Civic hybrid or the Accord hybrid, instead of the Prius, after the Prius deductions meet their cap.

Additionally, since hybrid deductions are capped by manufacturer, the Toyota Highlander hybrid will also be affected by Prius demand. Consequently, the Ford Escape hybrid or the Mariner hybrid could become a better deal simply because they will continue to qualify for the tax deduction longer than the Highlander hybrid.

If you are in the market for a Toyota Prius and the new deduction is a primary concern, you better buy your new hybrid as soon as possible to ensure that you will qualify for the deduction. Unfortunately, many hybrid buyers will already have this in mind, which could make finding a Prius more difficult than ever.

If the hybrid tax deduction won't have a big effect on your return, it might not be a bad idea to shop for a hybrid in these last few days of the year.

It's kind of ironic that Toyota's hybrid success could be to Honda and Ford's gain. The caps for hybrid vehicles are both far too few and too biased. If the government wants to get hybrids on the road as quickly as possible, then the free market approach to caps would have been to cap the total number of hybrids eligible per year, not to cap them by manufacturer.

Now Toyota hybrids will probably meet their cap before GM even starts selling real hybrids. That's a shame.

No hybrids in rap songs. What's the dilly yo?

Mercedes-Benz was the top brand to rap about in this year's top Billboard songs (more). Hybrid cars didn't make the bling list. No street cred yet for hybrids.

What IS the point of hybrid vehicle critics?

Hybrid cars make up around one percent of total automobile sales, yet hybrid hype could almost make you believe that hybrids are dominating automobile sales.

So, is it the hype that makes critics sound off?

Do hybrid critics just hate change, or do they hate hybrids because most of them aren't built in America?

I just don't get most hybrid critics.

Some hybrid critics claim hybrids won't save money. In some cases this is true; however, even in these cases, hybrid vehicles still pollute far less than their conventional counterparts, but you can't put a cost on that. It means everything to some people, nothing to others.

Anyway, why are some so concerned with criticizing those that stand up and use their money to cause less pollution? Why is acting on one's beliefs a bad thing? What are critics acting on anyway?

Besides, many hybrids can save money. There is no doubt that hybrids like the Toyota Prius and the Ford Escape hybrid can save money and can achieve significantly better fuel economy than their conventional comparisons. Yes, you will have to drive differently, but if reducing your fuel consumption is important, hybrids offer the greatest and most convenient tools available for achieving this goal.

Of course, driving habits aren't the only concern. While the Honda Accord hybrid is regularly ridiculed by hybrid critics, the Accord hybrid is built for the open highway. If you are driving in urban traffic, this car will not achieve great fuel efficiency. If you regularly drive between Temecula and Fontana, California every day, then an Accord hybrid can be a great buy.

So, again, what is the point of hybrid critics?

Many educated hybrid critics claim that hybrids are just a distraction along the path to fuel cell vehicles. Interesting point except for the fact that even GM has recently admitted that fuel cell vehicles will be fuel cell hybrid vehicles, as has Toyota (more on this). Thus, purchasing a hybrid vehicle helps invest in the fuel cell future. These critics see no value in that?

Even without fuel cell hybrid vehicles, current hybrid technology offers the ability to easily achieve 100 mpg with today's technology, and experimental hybrid technology goes even further, at far less costs than fuel cells.

So what? Well, achieving 100 mpg across America's fleet would easily end foreign oil dependency.

So, these critics don't think that foreign oil dependency, in addition to pollution and global warming, are important issues? These critics don't find it interesting that the Chinese are now building hybrid vehicles as they scour the Earth for oil deals?

Besides, so what if some want to invest in the future, without necessarily profiting from it personally. Is that really a waste of time? Instead, selfish gas-guzzling greed is a better use of resources?

Does this all come down to guilt? Is that what is it about?

Perhaps hybrid vehicles don't ultimately save every consumer money, but only help reduce oil dependency, help reduce pollution and help invest in the future. How pathetic.

Is this the point these hybrid critics are making?

Re: "GM drawing on the past as it attempts to speed development of hybrids"

I was just reading AutoWeek's article, GM drawing on the past as it attempts to speed development of hybrids, and it seems that GM is even more dysfunctional than I have previously thought.

Saying something like that can be dangerous because, in America, there are many devout GM followers. While I criticize GM quite often, it's not because I think GM is technologically inept. I think GM is corporately inept. When it comes to technology I think GM is just as capable as any other auto maker. It's vision where GM is lacking, and that boils down to corporate leadership.

Having said that, I think that GM is even more dysfunctional than previously thought because of the double talk coming out of Detroit. How can GM's Bob Lutz state that hybrid cars don't make economic sense when GM's Larry Nitz, a 30-year GM veteran and executive director of GM's global hybrid powertrains states, "Fuel cell vehicles are always fuel cell hybrid vehicles because they have battery packs. The same people that work on the hybrid batteries work on the fuel cell batteries. The same people that do electric motor controls for the hybrid system do motor controls for the fuel cells, too."?

So, the future IS hybrid vehicles, even to GM? So, why the lies and deception? Is this the model for corporate America? Is this the model for success?

Perhaps GM is just too old of a company, run by an ancient belief in the good ole boy's network. The rich might still run America, but average Americans aren't as blind as we used to be, and change is inevitable.

Toyota has been making the fuel cell argument in support of its hybrid vehicles since it started selling the Prius hybrid car. I've often stated that Toyota is laying out the fuel cell vehicle future right now, with every hybrid it puts on the road.

On the other hand, hybrid critics have long stated that fuel cell vehicles, not hybrid vehicles, are the future. Yet hybrid technology is integral to the fuel cell vehicle. Thus, the more work that is done on hybrids - even gasoline electric hybrids - the faster fuel cell vehicles become reality.

So, what exactly is the point of hybrid critics?

Let's be clear about another thing. Pure hydrogen vehicles ARE NOT the future, and if GM believed, or still believes, its path to fuel cells would begin with pure hydrogen vehicles as an interim step to fuel cell vehicles, then GM really sucks.

Pure hydrogen vehicles just aren't all that fuel efficient. That's a fact. Ford has noted that the best way to create fuel efficient hydrogen vehicles would be to create hydrogen hybrid vehicles. Once again hybrid technology is a critical component.

Yet, GM's boldest hybrid move to date has been hybrid lies.

Now I realize that GM has legacy costs that make R&D more difficult, and that is a serious problem, so serious that it's going to cost at least 30,000 their jobs. Nonetheless, GM has a multi-billion dollar yearly marketing budget. Couldn't some of that have been used for R&D, especially after 9/11?

Let's face it, in hindsight, GM and Ford should have started taking fuel efficiency seriously in the 80's and 90's - not just because of gas scares, or political problems in the Middle East, but because of simple market share. When does year after year of declining market share finally make you think, huh, maybe we should try something different?

Yet, even after 9/11, GM is still barely doing things different. In many respects, GM's very survival is still dependent upon gas-guzzling vehicles. High gas prices, too bad. Foreign oil dependency, too bad. Helping to finance terrorism, too bad. Polluting the environment, too bad. That's GM today.

Unfortunately, it's average Americans, not rich shareholders and corporate executives, that will pay the real price for this ineptitude.

Foreign hybrids versus American hybrids: Does it matter?

When it comes to hybrid vehicles, does it matter whether the hybrid is made in America or in a foreign country?

For many car buyers, the issue of American-made versus foreign-made is extremely important, but is it as important for hybrid buyers?

My focus at this point in time is hybrid technology. Whether that technology is American or not is a secondary issue. Actually, at this point in time, for me, the question is irrelevant. Since I'm not an SUV guy, and the only American hybrids available at this point in time are hybrid SUVs, such as the Ford Escape hybrid or the Mercury Mariner hybrid, I have little choice.

Is whether a hybrid is American-made, or foreign-made, important to you?

Are you waiting until January to buy a new Prius?

Are you going to buy a Toyota Prius, but you want to wait until January 1st so that you can get a higher tax credit?

According to a USA Today article, many hybrid buyers are doing the same.

Because the new tax credits for hybrid cars begin next year, many hybrid buyers are waiting because the tax credit is larger next year than this year. For example, the credit for a Prius now stands around $2000.00; however, next year that credit for the Prius could rise to $3150.00

This buying pattern has not been noticed in other hybrid vehicles, such as the Honda Civic hybrid, or even Toyota's Highlander hybrid.

Unforunately, the tax credit for hybrids like this vehicle are capped, so the new credit won't be around all of 2006 for the Prius.

New rules will push gas prices up 60 cents by July

By July gas prices will probably be about 60 cents higher than today due to new environmental regulations according to the article, Gas prices may surge on 2006 green rules.

"This ratcheting down of allowable sulfur adds to costs and also strains the refining system," said analyst Trilby Lundberg. "In 2006, the EPA could well cost gasoline consumers more than Hurricane Katrina did."

Other experts don't think the EPA measure will be as costly as Katrina - at least not by itself.

Since next year and the next couple of years are supposed to be equally as hurricane intensive as last year, another Katrina-like hurricane is very possible. Then there is China's growing gasoline consumption and the threat of terrorist attacks against U.S. oil interests.

Hence, without any doubt gas prices will be a good bit higher next year. How much higher will be dependent upon a number of factors, but the possibility of significantly higher gasoline prices is almost guaranteed.

Expect demand for hybrid cars to be even greater next year. The days of cheap gas are over.

Toyota Prius Hybrid Testimonials

I HAVE A 2005 PRIUS. ON THE HIGHWAY DOING 75 MPH, WITH THE AIR OFF, I GET 54.SOMETHING. IN TOWN I GET 46-47 MPG. THE CAR HAS 17000 MILES ON IT AND USES MOBIL 1 SYNTHETIC OIL. CAN'T WAIT TO MAKE IT A PLUG IN HYBRID.

THE WIFE HAS A 2005 CIVIC HYBRID,7000 MILES GETS 39 IN THE CITY 41-43 ON THE ROAD.

PUTTING IN A PHOTOVOLTIC SYSTEM TO POWER THE HOUSE ALSO WANT TO USE IT WHEN I CONVERT THE PRIUS TO A PLUG IN HYBRID.

JERR
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My 2004 Prius gets an average of 46.7 mpg!

B. H.
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On Prius wife is getting 48mpg in city, no idea on open road, we
don't go any place.

On Lexus RX400h, my car, with 91 octane, 24.6 in city, using 87
octane 21.9 in city. Almost happy with Lexus, very pleased with Prius.

W. K.
Palm Desert, CA
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We drive Toyota Prius's. Mine is a 2001, hers is 2003. During the summer and winter when the AC or Heat is running I average 40mpg, she does a little better, 43mpg. In the spring and fall when we don't use AC or heat much our averages are better 45-50mpg. We work 2 jobs each. One job for both of us is 25 miles away, the other is 75 miles away. The closer jobs are about 45 mph range. The further jobs are 65 mph range, with which we get lower mpgs.

Happy Holidays,

B. B. & J. J.
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I have a 2004 (Jan) Prius 30,000mi. I admit I am a little lead footed. My worst mileage for a tank was last winter 38MPG. The best was last spring 54MPG. Mostly though its 40 to 45 in winter, 48 to 52 in spring, summer & fall.

Art in the Northeast
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Hello,

The gas mileage for our 2004 TOYOTA full loaded prius from the display screen is about 44 miles/gal city mileage. This is an interesting question for us because I used to calculate gas mileage when I am at the pump. With the display of TOYOTA, I simply take down the number it gives us.
Regards,
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I have a 2004 Prius, which was bought in November of 2003. I believe it to have been the first Prius on the road in our county. It has made mostly area trips, but did take us to the Outer Banks of NC during the summer of 2004, and to Iowa in the spring of 2005. During the trip home from NC we did reach 60mph for a short time. Otherwise, we average about 46-48 mph in the colder weather and when using AC. During the rest of the year - spring and fall- we average about 49-50 mph. I absolutely love this car. It is fun to drive, has plenty of pep, and is very comfortable. We have had no problems with it, except for the original tires, which were probably cheap. I replaced them after about 25,000 miles. We have had folks follow us home to ask about the car! Now, however, there are several others in our area. We live in NE

P.A.
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I drive locally, 4-6 50 mile roundtrips a week and 3-5 times a year longer
trips, putting on about 18,000 miles a year. My 2004 Prius averages 44 to
47 mpg.
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My husband and I bought a Prius in June, 2005. Most of the driving has been in the city. The car is averaging 45 mpg. I just bought a 2005 Accord Hybrid. I have only driven in the city so far and am averaging 24 mpg.
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Are you the owner of a Toyota Prius hybrid? Tell us about your experiences with the Prius hybrid. What kind of gas mileage do you get in your hybrid Prius and in what kind of driving?

Add your Toyota Prius hybrid testimonial.

More on the Prius.

Honda Civic Hybrid Testimonials

THE WIFE HAS A 2005 CIVIC HYBRID,7000 MILES GETS 39 IN THE CITY 41-43 ON THE ROAD. I HAVE A 2005 PRIUS. ON THE HIGHWAY DOING 75 MPH, WITH THE AIR OFF, I GET 54.SOMETHING. IN TOWN I GET 46-47 MPG. THE CAR HAS 17000 MILES ON IT AND USES MOBIL 1 SYNTHETIC OIL. CAN'T WAIT TO MAKE IT A PLUG IN HYBRID. PUTTING IN A PHOTOVOLTIC SYSTEM TO POWER THE HOUSE ALSO WANT TO USE IT WHEN I CONVERT THE PRIUS TO A PLUG IN HYBRID.

JERR
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I have a 2005 Civic Hybrid. My mileage varies but I average 42-43 per tank if I run the air conditioner and 46-47 otherwise. Of course, in North Carolina summers you run it all the time.

J. C.
Parkton, NC
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My car is a Honda Civic Hybrid 2005.
I commute 40 to work each way, 5 days a week in LA. I typically drive
65-80 mph. I only sometimes have to drive in stop and go traffic. I drive around town only moderately. When I first got my car, I was really careful about making sure I optimized my mpg. I have stopped being so careful, but am still moderately efficient. I started out using 87octane gas then switched to 89. Gas octane doesn't seem to make any difference in my mpg.

Over the last ~17000 miles, I have averaged 46.1 mpg. I sometimes get
higher but usually right around 46 mpg for each tank. 2006 Honda Civic Hybrid (HCHII). 42 miles one way to work. Southern California – 40’s in the morning and 60’s in the afternoon. 1st two tanks 46.5mpg. Current tank reading 55.5mpg at ¼ full.Hope this helps,

D. S.
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Honda Civic 2004 highway 60%, 40% town driving 42mpg. Purchased Mar. 4, 2004 Already got 35,000 miles on it and I love it. Planning on buying another this next year 2006.

N. K.
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Are you the owner of a Honda Civic hybrid? Tell us about your experiences with the Civic hybrid. What kind of gas mileage do you get in your hybrid Civic and in what kind of driving?

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More on the Civic hybrid.

Ford Escape Hybrid Testimonials

Dear fellow hybrid owners,

At first I was disappointed that my 2005 Ford Escape Hybrid SUV purchased in May in Florida was getting only 23.5mpg. I realized, however, that when the Fall came I did not use the A/C so much, and my economy is now pretty consistently to 30.8 mpg around town, etc. So I am delighted. On a 1250 mile trip in October to Charlotte, NC, and around town there and back I got up to 29 but mostly around 26 or so.

I know not to trust the car-makers advertising 36 around town and 31 otherwise for the Ford Escape Hybrid. They have been doing that ever since I bought my first new Ford in '53. They can drive the test car on a track at reduced speeds that we could never repeat to get that mileage out on the highways. I accept 30.8, since my car before it was getting 16.3 mpg (2001Chrysler Town and Country with a V6 in it.)

H. B.
DeLand, FL

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Are you the owner of a Ford Escape hybrid? Tell us about your experiences with the Escape hybrid. What kind of gas mileage do you get in your hybrid Escape and in what kind of driving?

Add your Ford Escape hybrid testimonial.

More on the Escape hybrid.

Honda Accord Hybrid Testimonials

My Accord hybrid gets 17-18 mpg when my driving consists only of inner city San Francisco's stop and go traffic with lots of hills.

Local highway trips yield 26-28mpg generally.

I usually get 37-39 mpg on trips from San Francisco to Orange County (which is past LA.) The drive is all highway, but often has some mix of stop and go in the bay area and then the long steep grade up and down the Grapevine.

Hope that helps.
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I just bought a 2005 Accord Hybrid. I have only driven in the city so far and am averaging 24 mpg.

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Are you the owner of a Honda Accord hybrid? Tell us about your experiences with the Accord hybrid. What kind of gas mileage do you get in your hybrid Accord and in what kind of driving?

Add your Honda Accord hybrid testimonial.

More on the Accord hybrid.

Honda Insight Hybrid Testimonials

I have a 2001 Insight CVT. It averages 48 mpg around town and 55 on the highway (unless I let the engine speed get above 4000 rpm, in which case it drops). My overall average for a little over 42,000 miles is 50.0 mpg. I have two acquaintances with manual-drive Insights who get about 10 mpg better; the CVT really is smooth, however.
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Are you the owner of a Honda Insight hybrid? Tell us about your experiences with the Insight hybrid. What kind of gas mileage do you get in your hybrid Insight and in what kind of driving?

Add your Honda Insight hybrid testimonial.

More on the Insight hybrid.

Toyota Highlander Hybrid Testimonials

Hi,

We have a 2006 Toyota Highlander 2 Wheel Drive. We live at 3,500 foot elevation on the slopes of Haleakala, on Maui. Anytime we go anywhere, we almost always have to drive down to sea level and back. By far, most of our driving is highway driving and we are averaging just over 24 mpg.

I'm curious what others are getting in this vehicle.

Aloha,
Bill

Are you the owner of a Toyota Highlander hybrid? Tell us about your experiences with the Highlander hybrid. What kind of gas mileage do you get in your hybrid Highlander and in what kind of driving?

Add your Toyota Highlander hybrid testimonial.

More on the Highlander hybrid.

Lexus RX400h hybrid testimonials

On Lexus RX400h, my car, with 91 octane, 24.6 in city, using 87 octane 21.9 in city. Almost happy with Lexus, very pleased with Prius.

W. K.
Palm Desert, CA
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I own the Lexus Hybrid & I am disappointed with the gas mileage. The EPA says 32 mpg Highway. & 28 city. I was told by the dealer that to expect about 30 highway. I average 24 MPG overall. If I just do highway I get about 21 MPG. The Boston Globe did a review on the Lexus & reached the same results. Now the dealer says that this is a vehicle for city driving. This auto is not worth the extra $10,000 over the 330. I am disappointed that Lexus still stands by the EPA estimate. Now Lexus is telling the dealers that the car will get better gas mileage after 15,000 miles. This is a rip-off to the consumers .
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2006 LEXUS RX400h-----about 25 mpg but less in the cold weather-- mostly stop and go suburban driving

RICK in ILLINOIS

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Are you the owner of a Lexus RX400h hybrid? Tell us about your experiences with the RX400h hybrid. What kind of gas mileage do you get in your hybrid Lexus and in what kind of driving?

Add your Lexus RX400h hybrid testimonial.

More on the RX400h hybrid.

EPA developing hybrid technology?

So, the EPA can't predict fuel economy very well. What to do? How about develop technology for hybrid cars?

That's right, the EPA is working on a patented technology for hydraulic hybrids(more).

"The EPA has been seen only as an entity that approves rules and issues standards," said Chris Grundler, director of the EPA's Ann Arbor test lab. "We'd like to think we can be part of the solution as well.

Why not first try getting more accurate with your mileage predictions?

Anyway, there is already much doubt about the EPA's plan.

"Government should concentrate on fundamental science, long lead-time stuff," said John DeCicco, senior policy analyst with Environmental Defense. "How that basic knowledge makes its way into products, that's another issue. When you get into the demonstration phase, the government just doesn't have a track record of success."

Moreover, while the EPA believes their hybrid technology is currently better than gasoline electric hybrid technology, one has to wonder about their fuel economy testing of their new hybrid technology. Are we talking EPA laboratory findings, or real world findings?

Mitsubishi ready to go hybrid?

There is some speculation that Mitsubishi has a new hybrid vehicle that is ready to go, if it has a good showing at autoshows.

"The Concept-CT MIEV has four doors, all-wheel drive and a 1.1-liter gasoline engine. Each wheel has its own electric motor. The car will be shown at the Detroit auto show."

More

Another reason to check out the Accord hybrid?

Car and Driver has again named the Honda Accord as the Best Family Sedan. Since the Accord hybrid is both one second faster and more fuel efficient than the conventional Accord, many have called it the best Accord ever. Unlike many hybrid cars, the Honda Accord hybrid is a highway hybrid, so it doesn't achieve its best fuel efficiency in city driving. Nonetheless, if you are a highway driver, maybe you should check out the Accord hybrid.

GM unsure of Saturn Vue hybrid details

According to Reuters, GM still plans to launch the Saturn Vue Hybrid in 2006, which Reuter's called a competitor to the Toyota Prius and the Honda Civic Hybrid. GM; however, isn't releasing many details about the Vue hybrid.

"We need to get the price value equation right. We have to get the reliability right and the consumer needs to have enough time to see they are getting the benefit," Rick Wagoner, GM CEO, told Reuters.

Instead, GM is still focusing on SUVs to make the company profitable again.

I say, good luck. Gas prices will again spike sometime next year and the declining interest in large SUVs will only exacerbate. If another hurricane, some problem in the Middle East affecting America's foreign oil supply, or oil demand in China is higher than expected, GM could be in far worse trouble than they are today.

Still, you can't really expect GM to focus on the Vue hybrid. The hybrid Vue will only be a mild hybrid and its fuel efficiency capabilities will lag far behind those of the Civic hybrid and the Prius.

Unfortunately, GM's full hybrid vehicles won't be available until, at least, 2007.

GM's problem is simple: Vision, or the lack thereof

"We just couldn't react," Wagoner said in an interview last week with Automotive News . "It really highlighted that the underpinnings of our business are too fragile. So if we lose mix or volume, we cannot get costs down as fast as (sales) volume comes down." (more)

While I agree that GM isn't "nimble enough" to quickly react to changing market forces, it is still a week excuse for why GM is in a sales slump. Actually, GM's problem is quite simple, the company has no automotive vision.

Sure, you can say fuel cell vehicles, but GM has been talking up the fuel cell vehicle since Nixon. When is it time to stop talking and start doing? Fuel cell vehicles have been nothing but an excuse for GM to do nothing.

Back in the '90s, the U.S. government gave the Big 3 a billion tax dollars to develop fuel efficient vehicles. Yet, where are those vehicles today? What happened to those American tax dollars?

The evidence demonstrating the massive harm that auto pollution causes to America and the world has been piling up for decades. The intensity of the dangers in the Middle East and America's oil dependence has been increasing for years, and the evidence for massively growing worldwide demand for oil has been clear.

How could GM not think that maybe, just maybe, some of this evidence would eventually have an effect on the American automotive market?

Toyota and Honda were certainly paying attention to this evidence. That's why when GM ridiculed Toyota and Honda for pursuing hybrid cars, these companies just pushed ahead. With such a massive amount of evidence piling up, change was inevitable.

O.K., so GM made a mistake, but since 9/11 what have they really done to change? Shouldn't 9/11 have been the last straw?

So, what is GM's big announcement today? The new Chevrolet Tahoe is going to achieve 2 more miles per gallon on the highway. Of course, if you stop at a street light or stop sign, or do any other kind of city driving, your fuel efficiency will barely be above 10 mpg.

What a joke!

Sure hybrid vehicles might not be the absolute answer to GM's problems, or to America's problems with pollution and foreign oil dependency, but at least hybrids demonstrate that you are addressing the most important issues facing America today.

After further review GM leadership still stinks.

First Prius built outside of Japan

The first Toyota Prius to be built outside of Japan has been built in China.

Toyota vice-president Yoshimi Inaba said hybrid cars like the Prius could help China deal with its environmental and energy shortage problems.

"In addition to China's new automobile policy that encourages the use of hybrid vehicles, the introduction of emission regulations on par with those in Europe and the United States is also moving forward." (BBC)

The price of the Chinese-built Prius is a stiff 288,000 to 302,000 Chinese yuan ($US35,700 to $37,400 compared with from just $21,725 in the US). Sales target is 3,000 units in 2006 and internet orders start on Friday 16 December. (Just_Auto)

Kudlow suggests GM make a hybrid vehicle

Whenever I'm sitting at the computer I typically have CNBC on in the background. So, when Larry Kudlow started talking about GM, I thought I'd pay attention to catch any GM bankruptcy talk updates. In closing the segment, Kudlow admitted that bad management, and not just the Unions, were GM's problems. He also concluded that GM needed a hot fuel efficient auto, stating that GM could use a cool hybrid vehicle. Not too bad from an ultra conservative, free market capitalist.

Hybrid vehicle worth set to increase?

This morning as I scanned the news, two articles regarding the future of gasoline caught my attention. First, MSNBC noted that gas prices jumped for the first time in 10 weeks. While many analysts predicted the current drop in gasoline prices from post Katrina highs, as refineries came back on line, the real question has been how low will they go. So, I wondered, have we reached the bottom?

Obviously, gas prices have a huge impact on the value of hybrid cars. The higher gas prices go, the more valuable hybrids become.

Thus, when I saw the second article announcing that the IEA was predicting an increase in demand for oil next year compared to this year, the wheels in my head really started spinning.

Minimally, it appears that current gas prices are probably at the low end of their range covering the next couple of years. Of course, a terrorist attack or another Katrina could spark another huge run-up in oil prices.

Considering that terrorists have pointed to oil as a way to hurt America, and that scientists have pointed out that the next few years could be hurricane intensive, high gas prices seem inevitable for the next few years, but how much higher?

As I sat at my desk pondering this information, MSNBC switched to a segment on oil trading. It turns out that Goldman Sachs envisions a 4 to 5 year spike in oil prices that will eventually push oil prices over $100 per barrel and possibly much higher. This alone could keep gas far above the $3.00 per gallon mark.

If Goldman is correct AND another hurricane smashes refinery capacity in the next couple of years, how high could gas go? While that question is impossible to answer, it's clear that prices could spike much higher than immediately after Katrina.

Over the next five years it seems higher gas prices will be the norm, the only question left is how much higher. Unfortunately, the conditions appear ripe for significantly higher gasoline prices.

How valuable will hybrid vehicles be then?

Is December the best month to buy a hybrid vehicle?

According to a MSNBC article, December is the best month to buy a car.

"Several factors make December an advantageous time get a great deal on a car, he said, including the fact that most dealerships and salespeople have end-of-month and end-of-year goals and quotas to meet. And an “inventory tax” on all unsold vehicles remaining on dealer lots Jan. 1 provides an added incentive to move vehicles," notes the article.

Because of the demand for hybrid cars, it might be assumed that such deals wouldn't exist for hybrid vehicles such as the Toyota Highlander hybrid, or the Ford Escape hybrid. The analysts cited in the article; however, note that "a slow December means dealers will offer good prices on some of their hottest models, including hybrids, so shoppers could bag a popular car like the Toyota Prius at close to its manufacturer’s suggested retail price."

So if you have been thinking about buying a hybrid, it might be worth checking out your local dealer in December to see if you can't find a deal.

Syriana, Kyoto and Hybrid Cars

So, the Montreal climate conference resulted in a 150 Nation agreement for further meetings that won't include the U.S. (more). The Bush administration won't sign onto the Kyoto Protocol because of fears that mandatory emissions cutbacks could have a negative effect on the U.S. economy.

While I support the Kyoto Protocol, I think Bush does have a point about the economy, but I think he has an even greater point when he demands that Kyoto must include India and China. Nonetheless, in the midst of ever more global warming evidence, I think serious action is required, and Kyoto might be a good step because it gets the U.S. to stop talking about global warming and to start doing something about it.

So, what is Bush's answer to global warming, technology.

While I agree with Bush, I don't agree with his process for bringing forth such technology. The Bush future is the hydrogen economy, which I believe in, but I also believe we can't wait for it. We must start taking action NOW.

Ironically, one of the main contributors to global warming is also one of the main contributors to terrorism - oil dependency. Yet, even after 9/11, after Iraq, after Katrina, the U.S. is still taking little action to really change America's dependency on oil.

If Bush believes in technology, then why doesn't he seek oil independence the same way Kennedy sought the moon in the '60s?

The technology just isn't there yet?

Baloney!!!!!

While many criticize hybrid cars for their costs and for their failure to meet EPA fuel efficiency ratings, the truth is, if every American drove a Toyota Prius hybrid today, we would end foreign oil dependency today.

But the best part of hybrid cars isn't what they can do today, but what they can do tomorrow if we invest. Experimental hybrid cars demonstrate that the technology to drastically reduce America's oil consumption exists right now, and it really isn't that expensive. In fact it is incredibly less expensive and incredibly more feasible than hydrogen vehicles.

Is it more expensive than conventional vehicles, yes, and that is why the government needs to get involved. Still how expensive is the war on terror, or the costs of pollution and global warming?

Recently, Bill Ford lobbied the government to provide more tax incentives to help Detroit reduce foreign oil dependency and to regain its sense of automotive innovation.

The government has said it isn't interested.

Isn't this exactly what Bush was talking about when it comes to better alternatives to Kyoto? But it isn't just Kyoto, its the war on terrorism as well.

"I'm involved in this because most of the world's oil reserves are owned by countries that finance people that want to kill us, that finance radical Islam," Anne Korin, co-director of the Washington, D.C.-based Institute for the Analysis of Global Security.

While Mrs. Korin doesn't believe in global warming, she is joining with global warming activists and using the movie Syriana to bring attention to the dangers of America's oil dependence (more).

Yet, GM is set to roll out model after model of gas-guzzling SUVs and neither Ford nor GM seem to know how to be profitable in a fuel efficient world.

What better opportunity for the government to get involved? This isn't about interfering with free markets, it's about protecting the people from the proven dangers of terrorism, while also protecting the environment and the 'possible' dangers of global warming. If global warming isn't a national security issue, terrorism certainly is.

And, speaking of the economy, if America is the fuel efficient, greenhouse reducing technology leader of the world, what could be better for the economy?

Some cities question costs of hybrid cars

The AP is reporting that some cities are questioning the costs of hybrid cars.

"That's what we're finding with the initial cost ... it doesn't wash out," he said. "You're actually paying more money." said James Muller Philadelphia's fleet manager.

Philadelphia's hybrid fleet of 20 Ford Escape hybrids and 6 Toyota Prius hybrids; however, was bought primarily to improve air quality. Of course since hybrids cost more up front, it takes years to recover the costs. Yet, the benefit of improved air quality isn't added to the value of the car - at least not in financial terms.

So how much does dirty air cost? According to numerous health studies quite a lot - well into the billions.

Thus, in New York, "which had bought more than 830 hybrids as of 2004, the vehicles make sense because the city now requires the purchase of the cleanest vehicle available, said Mark Simon, director of alternative fuel programs."

Additionally, if money is a concern, one has to question the way cities like Philadelphia, for example, are spending their money. Do they really need an SUV, or would a vehicle like the Prius have made more sense? Obviously, the Prius is far cheaper than a SUV and would offer the greatest fuel economy in an urban environment like Philadelphia.

Perhaps the functionality of an SUV was required, but in terms of just carrying passengers, the Escape hybrid isn't going to offer any more seating than the Prius. Just changing Philadelphia's ratio of Prii to Escape hybrids could have saved 10's of thousands of dollars.

Hybrid car tax estimates for the 2006 Clean Vehicle Tax Credit

While the tax credits for hybrid cars have not been officially calculated by the IRS, ACEE has estimated what those credits should be by vehicle.

Ford Escape Hybrid = 2wd=$2600.00; 4wd=$1950.00
Honda Accord Hybrid = $650.00
Honda Civic Hybrid = Auto=$2100.00; Man=$1700.00
Honda Insight Hybrid = Auto=$1450.00
Lexus RX400h Hybrid = $2,200.00
Mercury Mariner Hybrid = $1950.00
Toyota Highlander Hybrid = 2wd=$2,600.00; 4wd=$2,200.00
Toyota Prius Hybrid = $3150.00

Honda hybrids from Thailand

Honda is considering a move to build hybrid vehicles in Thailand as a way to cut down on production costs according to a recent story.

"We are looking for a further development of tax benefits (in Thailand) at this stage," Asian Honda's spokeswoman told AFP on Tuesday.

In addition to tax benefits, "Honda cars made in Thailand could enjoy a high ratio of local content enabling the carmaker to ship its hybrid vehicles overseas at a competitive cost, the spokeswoman said."

Honda's second generation Civic hybrid is now hitting showrooms across the country. It's new hybrid drive should help the hybrid Civic better compete with the Toyota Prius. In addition, Honda offers the Accord hybrid.

Toyota has also announced that it will develop and build hybrids in China as well.

Germans continue push into hybrid vehicles

According to a new article, Germans are continuing to invest in technology for hybrid cars because of U.S. demand. By the end of this decade, VW, Porsche, Mercedes and BMW all will offer hybrids in the U.S.. There is also a good chance that diesel hybrids might be in the hybrid mix coming from Europe.

Washington not interested in bailout for U.S. automakers

Last week I wrote about how Bill Ford was lobbying the government for help to fight foreign oil dependency and to help bring forth American automotive innovation. This week Washington responded, no thanks (more).

So, it doesn't look as if any new incentives for hybrid cars are on the radar.

Sick of narrow-minded hybrid car critics

I was reading some AutoWeek forum entries this morning about hybrid cars when I realized that most hybrid critics are not only narrow-minded, but they have a complete lack of vision.

How does the quote go, "There is only one constant in the universe, change." I guess the Buddhists call it impermanence, or the idea that in 100 years, everyone that exists today will be gone, yet the world will go on, it will just be different because change is constant.

If hybrid critics were leading the world for the last 100 years, the world would still be riding horse and buggy. Fortunately, change is inevitable.

But back to the point. The two main criticisms of hybrids are 1.) They aren't as fuel efficient as the EPA rates them, and 2.) They don't save money.

It is true that hybrid vehicles aren't as efficient as the EPA rates them. All vehicles aren't as efficient as the EPA rates them. So what's the point?

Additionally, individual driving habits have a HUGE affect on fuel efficiency - in both hybrids and conventional vehicles. Even a standard Toyota Highlander can achieve better than average fuel efficiency by adjusting driving habits. Nonetheless, the Highlander hybrid or Escape hybrid can achieve much larger increases in fuel efficiency by adjusting driving habits compared to their conventional versions.

Shouldn't hybrids just be more fuel efficient?

Well, they are. For the average driver, hybrid technology will achieve better fuel efficiency than a standard vehicle, especially in city driving. And if you adjust your driving habits, you can significantly increase a hybrid's fuel efficiency performance.

Since most drivers of hybrids are concerned with saving fuel, hybrid technology offers an excellent tool for them to meet their goals.
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