Friday, May 23, 2008

Change is in the air - hybrid sales are surging

Automakers in Detroit have long resisted an urge for change. What GM engineers see as a "sea change" looks more like a swell in a lake. GM has plans to reduce annual production of SUVs and pickup trucks by 40 percent to 1 million vehicles from 1.7 million by 2012. On Thursday, Ford said it will cut truck and SUV production by as much as 40% in the second half of this year, because of a "fundamental shift" by U.S. consumers away from trucks and large SUVs.

For the Big3 it seems that the train has long left the station. Sales of hybrid cars are surging. "The day the car comes in is the day the car goes out," says a dealer.

Although hybrid cars account for only about 3% of U.S. car sales, their share is growing rapidly. Sales of hybrid cars surged 25% during the first four months of this year compared with the same period last year. And the pace accelerated last month, when sales jumped 58%. That outpaced the overall April sales gain of 18% for small fuel-efficient cars and comes as total new-vehicle sales are slumping.

The shortage is pushing up prices. A month ago, Priuses were selling for an average of $25,147, slightly below the sticker price. Today, some dealers are slapping $3,000 premiums on the car -- pushing prices well over $28,000, according to Jesse Toprak, Edmunds' head of industry analysis.

The reason for this sudden surge in sales is simply the high price for gasoline and the attractive fuel efficiency of hybrid cars. The Toyota Prius hybrid runs 48 miles per gallon, the Toyota Corolla manual consumes 37 and the Lexus RX 350 on 23 miles per gallon.
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read also: What "sea change"? - GM will still produce 1 million SUVs by 2012
Thursday, May 8, 2008

source: Hybrid sales are zooming
By Martin Zimmerman, Los Angeles Times Staff Writer, May 23, 2008,0,5437081.story?track=rss

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