the NEW gem: "Hybrid hype"
#1
05-06-2005, 07:46 PM
the NEW gem: "Hybrid hype"
I had to transpose, since I couldn't find it electronically on the web (yet)
Source: Car and Driver
Issue: June 2005, Vol. 50, Number 12, Page 31
Author: Brock Yates
Editorial Title: Hybrid Hype, and miscellaneous ramblings
Source: Car and Driver
Issue: June 2005, Vol. 50, Number 12, Page 31
Author: Brock Yates
Editorial Title: Hybrid Hype, and miscellaneous ramblings
While the greenies and their flunkies in the so-called major media palpitate over the future of the hybrid, the flinty-eyed analysts at California's J.D. Power and Associates have survey data that indicate a less than twinkling future for this complex and expensive alternative to the hated internal-combustion engine of the elites. The J.D. Power folks, who are usually right on the money in their forcasting, predict that 2006 sales among the proposed 17 hybrid models (cars and light trucks) are expected to total about 260,000 units, or roughly 1.5 percent of the domestic market. J.D. Power claims hybrids will grow to 38 models, both cars and trucks, by 2011 and will peak at a three-percent share. Toyota will hold its lead, with Honda in the hunt and Chevrolet, Ford, and DaimlerChrysler playing relatively minor roles.
Three percent of the total market? Wait a minute! The pundits tell us that hybrids are the future - at least until the fuel cell arrives (at about the same time they discover perpetual motion and cure the common cold).
But one of the most respected, high-powered engineering executives in the industry, speaking off the record, recently told me, "J.D. Power is probably right, although maybe a bit optimistic. Everybody in the hybrid market is losing money. The current units, which are very complex, cost about $5000 more than a normal IC engine. The buyer is paying about a $3000 premium, which means the manufacturer is upside down for about $2000. That, plus the fact fuel-economy gains are less than people think, what with winter when the heater and defroster are used and summer when the A/C is in operation. Yes, there is a small improvement in city mpg, but it's negligible on the open road. Couple that with the still-undertermined cost of maintenance of the Rube Goldberg power units and the unknown life cycle of the battery packs, and the economic advantages become hazy at best.
"A great deal depends on the future price of gasoline or if the government radically increases fuel-mileage standards. But as it stands now, the average customer is going to stay with a conventional automobile because the mpg cost factor makes obvious economic sense.
"The price of fuel and lower-cost technology will govern the market, and the role hybrids will play remains doubtful at best."
Of course, the know-it-alls in the big media have instant solutions. Example: Newsweek columnist Fareed Zakaria recently touted some supremely woozy technology using "plug in" hybrids with flexible fuel (15-percent petroleum, 85-percent methanol or ethanol) and - viola! 500 mpg! Zakaria ignores the wallet-busting cost of producing, refining, and disributing methanol, ethanol, hydrogen, and other alternative fuels - a concept that has long since been hooted down by people who understand the harse realities of energy production. If only these gasbags in the elitist press would do their homework.
... other "miscellaneous ramblings" ensue ...
Three percent of the total market? Wait a minute! The pundits tell us that hybrids are the future - at least until the fuel cell arrives (at about the same time they discover perpetual motion and cure the common cold).
But one of the most respected, high-powered engineering executives in the industry, speaking off the record, recently told me, "J.D. Power is probably right, although maybe a bit optimistic. Everybody in the hybrid market is losing money. The current units, which are very complex, cost about $5000 more than a normal IC engine. The buyer is paying about a $3000 premium, which means the manufacturer is upside down for about $2000. That, plus the fact fuel-economy gains are less than people think, what with winter when the heater and defroster are used and summer when the A/C is in operation. Yes, there is a small improvement in city mpg, but it's negligible on the open road. Couple that with the still-undertermined cost of maintenance of the Rube Goldberg power units and the unknown life cycle of the battery packs, and the economic advantages become hazy at best.
"A great deal depends on the future price of gasoline or if the government radically increases fuel-mileage standards. But as it stands now, the average customer is going to stay with a conventional automobile because the mpg cost factor makes obvious economic sense.
"The price of fuel and lower-cost technology will govern the market, and the role hybrids will play remains doubtful at best."
Of course, the know-it-alls in the big media have instant solutions. Example: Newsweek columnist Fareed Zakaria recently touted some supremely woozy technology using "plug in" hybrids with flexible fuel (15-percent petroleum, 85-percent methanol or ethanol) and - viola! 500 mpg! Zakaria ignores the wallet-busting cost of producing, refining, and disributing methanol, ethanol, hydrogen, and other alternative fuels - a concept that has long since been hooted down by people who understand the harse realities of energy production. If only these gasbags in the elitist press would do their homework.
... other "miscellaneous ramblings" ensue ...
Last edited by Jason; 05-06-2005 at 07:54 PM. Reason: Please use [quote] tags
#2
05-06-2005, 08:15 PM
Re: the NEW gem: "Hybrid hype"
I'll be the first to comment on my post:
1) Brock's animadverting is weak and off the mark. The "facts" are like statistics - you can find the ones you like to suit your agenda. Certainly I, and many others on this site, are able to BLOW AWAY the EPA estimates, both in the city and on the "open road". It comes down to how much attention to your driving style you are willing to commit to making the car work for you. OK, he'd never be willing to admit to that, but that is his prerogative.
2) The comments provided by J.D. Power and the engineering executive seem grounded in economic reality and don't take capricious stabs at any particular demographic (the "greenies" or thier "flunky, gassbag-elitist" media counterparts)
3) What is missing from this most one-sided article is any mention of today's technology becoming mainstream on its own merits. What I mean is when new automotive techonolgy is introduced, its is "spotlighted" and sometimes branded right on a car's badge. (look at your car now; yes, it says hybrid). You knew early cars when they had anti-lock brakes as well (they TOLD you so, right on the badge!). Perhaps the battery technology will work in the long-run, and economies of scale will be realized to bring per unit costs down. Then what? Auto makers can build MORE powerful hybrid cars that also happen to benefit from the rewards of better economy. Maybe they will be able to do that with a very mainstream car one day. Something like an Accord or similar vehicle. It would be interesting to see if this actually caught on and became a reason why the "average" buyer would actually want the technology baked-in (more power - yeah, that's it!). And for commercial and fleet vehicles, lower operational costs. No guarantees, but it could be practical. I'm just making the point that this was totally missed.
4) Alternative fuel vehicles - Brock is introducing a new topic here to bolster his obvious hate of hybid vehicles as they exist today. Infrastructure and production are clearly huge hurdles for alternative-fuel vehicles, but let's make that a different discussion. The 38 models that J.D. Power is alluding to, I'm sure don't use alternative fuel.
1) Brock's animadverting is weak and off the mark. The "facts" are like statistics - you can find the ones you like to suit your agenda. Certainly I, and many others on this site, are able to BLOW AWAY the EPA estimates, both in the city and on the "open road". It comes down to how much attention to your driving style you are willing to commit to making the car work for you. OK, he'd never be willing to admit to that, but that is his prerogative.
2) The comments provided by J.D. Power and the engineering executive seem grounded in economic reality and don't take capricious stabs at any particular demographic (the "greenies" or thier "flunky, gassbag-elitist" media counterparts)
3) What is missing from this most one-sided article is any mention of today's technology becoming mainstream on its own merits. What I mean is when new automotive techonolgy is introduced, its is "spotlighted" and sometimes branded right on a car's badge. (look at your car now; yes, it says hybrid). You knew early cars when they had anti-lock brakes as well (they TOLD you so, right on the badge!). Perhaps the battery technology will work in the long-run, and economies of scale will be realized to bring per unit costs down. Then what? Auto makers can build MORE powerful hybrid cars that also happen to benefit from the rewards of better economy. Maybe they will be able to do that with a very mainstream car one day. Something like an Accord or similar vehicle. It would be interesting to see if this actually caught on and became a reason why the "average" buyer would actually want the technology baked-in (more power - yeah, that's it!). And for commercial and fleet vehicles, lower operational costs. No guarantees, but it could be practical. I'm just making the point that this was totally missed.
4) Alternative fuel vehicles - Brock is introducing a new topic here to bolster his obvious hate of hybid vehicles as they exist today. Infrastructure and production are clearly huge hurdles for alternative-fuel vehicles, but let's make that a different discussion. The 38 models that J.D. Power is alluding to, I'm sure don't use alternative fuel.
#3
05-06-2005, 08:50 PM
Re: the NEW gem: "Hybrid hype"
"But one of the most respected, high-powered engineering executives in the industry ... "
Not for long. You can only spew FUD for so long, before it chokes you.
I know that I personally would not consider buying a car from this company in the future, since the exec has trashed it's reputation.
Not for long. You can only spew FUD for so long, before it chokes you.
I know that I personally would not consider buying a car from this company in the future, since the exec has trashed it's reputation.
#4
05-07-2005, 12:25 PM
Re: the NEW gem: "Hybrid hype"
So, what they're saying is that if gas hits $3/ gallon more people won't be willing to trade in those SUV's for a hybrid? I don't believe it, I'm already seeing it in the Bay Area where everyone commutes because there is no reliable, efficient system for mass transit. If hybrids can only double market share in six years with 38 (!!) models available to the people then something is wrong. I wonder when this article was written because if Toyota makes 100k Priuses this year, I should think they will sell them all. Right now people are scared of gas prices, and with increased awareness of hybrid technology the public will realize that there is no reason not to own a hybrid. As for it not being economically good for the companies? I see Toyota stepping up production making more cars for more people who want them, not less. If they were losing that much money I would imagine they'd keep production right where it is. Besides I imagine like with many other products (such as when you buy a computer, which nets extremely low profits for the vendor) Toyota is making a lot of money off of the extra services they provide. Extended warranty? Check. Routine maintenance? Check. Repeat clients? Check. In the long run they'll make their money and the price of the technology is bound to go down and get better quickly when companies see that there is a desire for it. As a parallel, I bought a first generation DVD player for a retail of $650, now you can buy one for $30 because the demand was there to improve the technology and mass produce it cheaper. The same will happen with the hybrid systems and batteries.
#5
05-07-2005, 12:43 PM
Re: the NEW gem: "Hybrid hype"
IMO, the thing that could potentially hurt hybrid sales is driving them the way that we do. Notice, I said "we". I'm ~43.5 mpg on this tank and I didn't get that way by zooming along at the speed limit. The perception of those around me have to be that my 255 hp Accord hybrid is gutless. It's hard not playing the game, but undoubtedly, it will cost sales if that's the perception.
I can't wait to hear the rebuttal coming with this one. Remember, I'm an offender, too. Maybe I'll try to compromise a bit more in an effort to promote normalcy.
I can't wait to hear the rebuttal coming with this one. Remember, I'm an offender, too. Maybe I'll try to compromise a bit more in an effort to promote normalcy.
#6
05-07-2005, 12:57 PM
Re: the NEW gem: "Hybrid hype"
If this group of people who want a gas guzzler, but did not buy one recently because of concern over gas prices, could now sign a contract for petrol at $2.50/gallon for the life of the car -- would they do so, and buy their desire ?
I suspect yes. Americans are willing to pay a *lot* of money for their "ride", and IMO only the fear of spiralling petrol prices without bound has reigned them in. If petrol prices seem to stabilize at a price below $3/gallon over the next year, I expect to see guzzler sales increase again.
For a price point: last week energy brokers were able to buy 5 year options at $50/barrell. That is not an upper bound on pump prices, but it does give an idea what the average prices are going to be.
I suspect yes. Americans are willing to pay a *lot* of money for their "ride", and IMO only the fear of spiralling petrol prices without bound has reigned them in. If petrol prices seem to stabilize at a price below $3/gallon over the next year, I expect to see guzzler sales increase again.
For a price point: last week energy brokers were able to buy 5 year options at $50/barrell. That is not an upper bound on pump prices, but it does give an idea what the average prices are going to be.
#7
05-07-2005, 01:00 PM
Re: the NEW gem: "Hybrid hype"
I've been wondering about other peoples perception also. I drive speed limit most of the time and in California, especially the Bay Area, that's just not normal. So, I've been wondering if those who pass me up just attribute it to another one of those "slow" hybrids or whether they notice or whatever? I'd like to think that a fair amount of the public out here is educated enough about the hybrid since most Hybrids reside in this state, but that's wishful thinking. I forgot to mention in my previous post that perhaps the reason that people don't get the estimated FE that Toyota posts is because they have no idea how to drive the car the proper way. The first week or so I had the car I was getting 46 mpg, after figuring out how to get the electric motor to take over on city streets I automatically jumped to over 50, it's a big difference. If you want to drive 75mph like everyone else out here, well of course you're not going to get 51mpg on the highway. If you're not going to learn how to work your car, then you better be content with that 46mpg. The dealer I purchased the car from offered classes that teach you how to drive the car, I didn't go, but I imagine if other dealers did similar and everyone learned to drive their hybrid properly, the numbers would jump up and there'd be nothing negative to say about it.
#8
05-07-2005, 01:16 PM
Re: the NEW gem: "Hybrid hype"
Nice post, Red. I couldn't agree more.
What you call perceptions, I call ignorance. Ask any 10 drivers without fuel gauges what percentage hit their car's FC takes by increasing speed from 60 to 75. I'll hazard a guess: 1/3 will give the bravado "who cares!" (while whining about prices); 1/3 will say "a percent or two", and the remainder will give you the deer in the headlights look, or get angry and walk off to the cafeteria.
BTW, some white space in your posts would make for much easier reading.
What you call perceptions, I call ignorance. Ask any 10 drivers without fuel gauges what percentage hit their car's FC takes by increasing speed from 60 to 75. I'll hazard a guess: 1/3 will give the bravado "who cares!" (while whining about prices); 1/3 will say "a percent or two", and the remainder will give you the deer in the headlights look, or get angry and walk off to the cafeteria.
BTW, some white space in your posts would make for much easier reading.
Last edited by EricGo; 05-07-2005 at 01:22 PM.
#9
05-07-2005, 06:15 PM
Re: the NEW gem: "Hybrid hype"
another improtant note is that the anti-hybrid press is quick to announce that hybrid owners are not seeing anything close to the published EPA figures in "real world" driving. So they: Attack the hybrid, of course. because for some reason it threatens them . . . or more specifically Brock in this case. Why, I can only wonder. What he SHOULD be attacking is the way the EPA calculates the figures, putting ALL vehicles on a level playing field . . . sure simulate 75MPH, aggressive acceleration,etc. No problem. All vehicles' numbers will go down, and hybrids will down EVEN more, but still be well above the likes of the competition.
#10
05-08-2005, 10:41 AM
Re: the NEW gem: "Hybrid hype"
Originally Posted by jahwerx
Yes, there is a small improvement in city mpg, but it's negligible on the open road.
