This year has been particularly difficult for the auto industry -- with some types of car suffering more than others. And although there’s an unrelenting drive towards greener, more fuel efficient cars with better gas mileage, sales of hybrid cars haven’t been as great as perhaps they ought.
Is the hybrid car dying? Or are there a set of external influences that have combined to create the perfect storm of circumstances to stifle sales? And should we worry?
Non-hybrids are starting to get great gas mileage
Historically, one of the main reasons for buying a hybrid-electric car has been the improvement in gas mileage and fuel economy hybrid electric cars offered over traditional gasoline engined cars.
In the past year, however, we’ve seen an increasingly large number of subcompact and even compact cars come to market with conventional gasoline engines capable of matching the performance of early hybrids.
2012 Kia Rio SX
And because there’s none of the complexities of a hybrid drivetrain to worry about, most of these new range of 40+ MPG cars cost less to produce. That makes them less to buy than a traditional hybrid.
Gas prices are dropping, people driving less
In an ideal world, we’d like to say that the drive towards higher mpg vehicles is driven by the desire to use less natural resources and pollute the planet less -- but the reality is that the cost of running a car often trumps everything else.
And in recent months, the price of gasoline has started to drop. Caused by a drop in demand for crude oil -- itself caused by people driving less -- the amount you pay to fill up today is probably 25-40¢ less now per gallon than it was in the spring.
While gas prices are still much higher than they were five years ago when hybrid cars started to become really popular, the drop in gas prices combined most people driving less mean that hybrid cars don’t represent quite as good an incentive on paper as they once did.
Natural disasters have stifled supplies
In the past year, we’ve seen not one, but two major natural disasters which have crippled the output of the entire auto industry.
Firstly, the devastating earthquake and subsequent tsunami that hit the eastern coast of Japan in March this year completely halted production of many cars worldwide, including the 2012 Toyota Prius hybrid and many other cars.
With supply chains obliterated, even U.S. built cars suffered, with many factories halting or severely restricting output for weeks.
More recently, the severe flooding in Thailand has again halted production at many car factories, including production facilities where much-needed battery, controller and motor components are produced for hybrid electric cars.
The 2012 Toyota Prius. Image: Toyota
Although gas prices may be dropping, the cost of living in a post-recession world is pretty high. As a consequence, many consumers aren’t willing to spend as much money on a new car as they once were.
Those who can afford a new car are often choosing to buy a cheaper, more fuel efficient car -- such as a small 40+mpg subcompact -- or choosing to skip hybrids altogether in favor of plug-in cars.
Electric, plug-in hybrids take market share
With more and more electric and plug-in hybrid cars coming to market, many hybrid owners are trading in their existing hybrids for a plug-in car rather than buy a new hybrid.
As a consequence, many automakers have suffered a drop in sales on pure hybrid cars as early-adopters move towards even greener, higher gas mileage or completely zero tailpipe emission cars.
The drop is temporary
Most, if not all of the contributing factors cited here are temporary. As the economy recovers and production volumes and gas prices rise, hybrid cars will no doubt enjoy a renaissance, both with and without plug-in assistance.
In the meantime, if you can afford a used hybrid, you might be able to grab a good bargain.