Last Tuesday, we noted that sales of the 2010 Toyota Prius have soared due to the Cash-for-Clunkers program. In fact, it's the fourth most popular vehicle purchased to replace a clunker trade-in.
The unexpected success of the Clunkers trade-in system, formally known as the Car Allowance Rebate Systems (CARS) program, led the Senate to add $2 billion more in funding on Friday, meaning the program will continue at least through Labor Day.
But the bad news is that supplies of the 2010 Prius are getting very, very thin on the ground.
Worse yet, Toyota can't quickly ramp up production due to a shortage of the hybrid's nickel-metal-hydride battery pack. In Japan, Toyota can build half a million Prius cars a year--limited by the number of battery packs that can be built by Panasonic EV Energy Co.
By next summer, that company should have doubled its production capacity in stages to 1 million Prius packs a year. But until Toyota can get adequate numbers of packs, the company won't expand its own capability.
The 2010 Toyota Prius, with its combined EPA mileage rating of 50 miles per gallon, is by far the most fuel efficient car available under the Clunkers program.
Since the Clunkers program began in the last week of July, Prius supply has fallen from 12 to 14 days' worth of sales to 6 to 7 days, said Jim Lentz, the president of Toyota Motor Sales, at last week's Automotive Briefing Seminars for industry executives.
A standard supply rate is considered to be 60 days' worth of sales, so the Prius can be considered effectively sold out in some regions.
And that, of course, means that you will have far less margin to bargain than if the 2010 Prius were in ample supply. You have been warned.
Pile of junk cars