Are automakers destroying hybrid technology?

Yesterday, Business Week printed the article, Are hybrid sales running out of gas, which argues that other than the Toyota Prius hybrid, the sales of most other hybrid cars are slowing.

Unfortunately, I basically agree with Business Week that the costs of hybrids are an issue that is slowing hybrid sales. Hybrid vehicles do save gas, but they do not always save enough gas to justify the higher costs, especially hybrid SUVs.

Thus, only those with the wallet and the passion to fight foreign oil dependency or for the environment, can afford these vehicles.

A much larger customer segment; however, can afford vehicles such as the Prius or the Honda Civic hybrid. Still, the conventional Civic isn't a gas-guzzler, so you inevitably start comparing the Civic hybrid to the conventional Civic. For most consumers, up-front costs will eventually dominate.

The Prius, on the other hand, is unique. It is the hybrid vehicle, not a conventional vehicle with hybrid technology.

If someone wants to buy a sports car, they wouldn't typically want to buy a souped-up Chevy Malibu, they would want to buy a Corvette. Simply putting a badge on a Chevy Malibu that states 'Corvette Powered' doesn't make the Malibu a Corvette, even if they both have the same engine and performance.

Vehicles, such as the Ford Escape hybrid or the Toyota Highlander hybrid, will always have an audience, but they will never meet the sales demand of the Prius. If there were a unique hybrid SUV; however, it would dominate hybrid SUV sales.

Nonetheless, in the next year gas prices are going to go up significantly as refineries go from MTBE to ethanol additives. Additionally, in the next couple of years we will probably see multiple, significant spikes in the price of gasoline. All of these events will renew interest in ALL hybrid vehicles.

Additionally, hybrid technology is and will continue to advance. These advancements, and the potential small business tax credit for hybrid vehicles, could make hybrids, such as the Escape and Highlander, very cost-effective - perhaps even long term bargains.

Still, the only way hybrid technology will ever take off is when a number of unique hybrid vehicles are competing against each other. If automakers don't take this approach, the potential of hybrids will never be reached.