HYBRIDS NOW CHIC
A funny thing happened as U.S. motorists were pursuing their love affair with SUVs: high gasoline prices and the Iraq war suddenly made gas- electric hybrids chic.
Toyota Motor Corp. and Honda Motor Co. say they can't build enough fuel-efficient Toyota Priuses and Honda Civic hybrids to satisfy consumer demand. In a U.S. automotive market that was down 4.4 percent in the first quarter from 2002, few other models are encountering this problem, even other fuel-efficient models that are selling well.
The price of unleaded regular, which peaked on March 10 at an average wholesale price of $1.16 a gallon, has been an attraction for some motorists. Automakers also are detecting more awareness for hybrid technology, which is gaining some cachet because it is modern, efficient and reflects a political view (dubious, in this writer's opinion) that the nation consumes too much energy.
``Media attention is very high and consumer attention is growing,'' said John Hanson, a spokesman for Toyota Motor Corp.'s U.S. sales arm. ``People are getting a clearer and clearer idea what the technology is.''
In Hollywood, actor Leonardo DiCaprio bought five Toyota Prius hybrids. Cameron Diaz, also of the silver screen, drives one, as does Larry David, creator of the TV comedy series, Seinfeld. Honda says it doesn't know if celebrities are driving the Civic, because the company declines to promote the model by sponsoring environmental charity events frequented by entertainment figures.
David E. Davis, editor of Automobile magazine, likens hybrids to ``prop jets, waiting for the real jets to come along.'' He's mesmerized, he said, by gauges showing how much power is supplied by the engine and how much by the battery.
Gas-electric hybrids use a conventional gasoline engine and a larger-than-normal battery in tandem to power the wheels and to keep the battery recharged. Power normally lost from braking also recharges the battery, and the entire system shuts down when the vehicle comes to a stop, such as in traffic.
By touching the accelerator power is restored instantly. The sensation is a bit odd at first, though most drivers say they get used to it quickly.
Honda, which had been shooting for sales of 2,000 Civic hybrids monthly, sold 2,274 in February and 2,532 in March. The $20,000 model qualifies for a federal tax break worth up to $2,000 and achieves 46 miles per gallon in the city, 51 on the highway.
The automaker is coy about which of its models will get hybrid technology next. Executives have hinted it will be a larger Honda, perhaps an Accord, equipped with a V6 engine. ``We don't know if this will turn out to be a mainstream technology,'' said Yuzuru Matsuno, a spokesman.
Toyota aims to sell 300,000 hybrid vehicles globally within a few years. Next week at the New York International Auto Show, the No. 1 Japanese automaker will display an all-new Prius model for the first time. Instead of distinctive -- some might say quirky -- exterior styling, the new model is expected to be more attractive, larger and quicker.
Detroit Faces Risk
A year from this fall Toyota expects to introduce its RX330 car-based SUV with the next-generation hybrid system. ``This will be considered the premium power option when the RX330 is ordered,'' said Hanson. "We anticipate a high rate of installation.''
General Motors Corp., Ford Motor Co. and DaimlerChrysler AG's Chrysler subsidiary are still a year or two from offering hybrid models -- mostly on light-truck and SUV models -- to retail customers (as opposed to commercial fleets). Detroit automakers are less enthusiastic than Toyota about hybrids, in part because they don't have Toyota's financial strength and, therefore, face a bigger risk.
Still, U.S. politics are forcing automakers to step up their investment in new technology to comply with stricter federal fuel- economy rules. Last week the National Highway Traffic Safety Administration said the fuel-economy standard for light trucks -- which includes most SUVs -- will rise to 22.2 miles per gallon by 2007 from the current 20.7.
Hybrids Might Fade
The government estimated that meeting the new economy standard would cost the auto industry $1.57 billion. Toyota, however, already has achieved 22.1 miles-per-gallon on models classified as light trucks, while Honda exceeds federal economy standards.
With the Iraqi military crumbling and crude oil and gasoline prices dropping by the day, the latest rush to buy high-mileage hybrids might fade.
The next generation of hybrid technology will be appearing soon. Hybrid technology -- championed mostly by Toyota and Honda - - already is migrating to larger, more expensive models, whose buyers won't be seeking economy, rather the trendiest new gizmo and, perhaps, a chance to save the Earth.
Written by: Doron Levin, Bloomberg News
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