NCPA - National Center for Policy Analysis

Hybrids' Unlikely Rival: Plain Old Cars

March 8, 2012

As automakers use new and not-so-new technology to wring efficiency from traditional motors, gasoline-electric hybrids are falling out of favor, says BusinessWeek.

  • Hybrids fell to 2.2 percent of the U.S. auto market last year, from 2.4 percent in 2010, after peaking at 2.8 percent in 2009, says researcher LMC Automotive.
  • The reason is simple: Consumers don't want to pay as much as $6,000 extra for a hybrid when they can get 40 miles per gallon on the highway in a standard car, such as a Chevrolet Cruze or Hyundai Elantra.
  • And even more conventional cars with hybrid-caliber mileage are coming this year, thanks to advancements that enable engines to burn fuel up to 20 percent more efficiently.

Combustion's comeback is running head-on into the auto industry's ambitious plans to roll out an array of electrified vehicles in coming years to meet more stringent federal fuel economy regulations.

  • The number of hybrids, plug-in hybrids and electric vehicles on the U.S. market will nearly quadruple by 2020 to 153 offerings from 40 last year, LMC forecasts.
  • But with buyers showing a preference for gas-sipping regular cars, automakers may rethink the need to stock their showrooms with so many hybrids, which aren't nearly as profitable because of their costly technology.

Everyday engines are being enhanced by modern technologies such as electronic controls, eight-speed transmissions that keep engines operating in their optimal range, and direct fuel injection that allows gas to burn more efficiently.  Combine those with tried-and-true technologies like turbo-chargers, and automakers can improve mileage and horsepower simultaneously.  The advancements also allow carmakers to sell more power in a smaller package. 

Source: Keith Naughton, "Hybrids' Unlikely Rival: Plain Old Cars," BusinessWeek, February 23, 2012.

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