Big money on Wall Street is betting hybrid autos will become a bigger part of the mass market this decade, but will remain a minority privilege for those who don't need a price-tag bargain. That's the conclusion of a study just out from J.P. Morgan. By the year 2020, 20% of U.S. car sales will be hyrbids. Globally hybrids will be about 13%. That's eleven years from now. Right now hybrids are about 1% of the global car market. Some automakers have no current hybrids for sale.
Morgan predicts the increase in market share will be accompanied by a narrowing of the price differential between more costly hybrids and the comparable traditional gas cars. The price margin is now estimated at over $5500 per new car, and it should drop to less than $2000 per car by 2020, says Morgan's projection.
PRIUS RULES...IN JAPAN
Despite the current global auto sales slump, the new genertaton Toyota Prius is very popular in its home country. Back orders for the new Prius hybrid in Japan are well beyond expectations. Japan no longer taxes hyrbid car sales. The Prius is expected to become the #1 selling new vehicle there.
Because of the heavy stop-and-go traffic in much of urban Japan the Prius has a strong advantage. It uses no fuel when stopped unless the air conditioning is on. The new model is expected to yield 90 MPG in typical Japanese driving.
Toyota is still facing an overall corporate loss this year. Its Lexus and other cars are not selling well anywhere.
WHAT WILL DETROIT DO?
Up in Michigan the newly toothless auto industry is realizing that's its financial and political dependence has made it unable to stave off tighter efficiency regs in the U.S. And now the industry is starting to look at the future, realizing there is not a single traditional fuel vehicle made in America that meets the future MPG standards. Oops. Back to the drawing board. Lighter materials, less unneeded crud in the car, less glass and more plastic, smaller all around. And then how do you make the surburban commuter buy a smaller, lighter, less armored vehicle? Of course, the hidden agenda? The auto makers in US will have to "re-tool" to meet the standards which they fought for years with expensive lawyers. Now that they can't really get cash, even from gullible Congress, for more lawyers, the auto bigwigs have done a 180 and will ask for money to "re-tool." Bet they get billions. [poll id="139"]