Dual drive eases gas pains

Hybrid Cars

May 02, 2004|By Lorraine Mirabella | Lorraine Mirabella,SUN STAFF

All the new car come-ons promoting fancy gizmos, exterior styling or roomy cabins might be missing the point these days for some car buyers - easing the pain at the pump. With gasoline prices at record highs, fuel efficiency is increasingly at the top of the list.

"The magic threshold is $1.75 [per gallon]. That's when people get concerned," said Paul Ritchie, a Hagerstown Honda dealer who is vice chairman of the Maryland New Car Dealers Association. "Back when gas was really low, we seldom heard anybody mention miles per gallon when they came in to talk about a car."

That has changed as prices have risen, to an average of $1.79 in the Mid-Atlantic and $1.81 a gallon nationwide for regular gasoline, according to the U.S. Energy Department. Prices have risen more than 30 cents a gallon since the beginning of the year because of high crude oil prices, low gasoline inventories and strong demand.

For some buyers, that means trading in gas-guzzling sport utility vehicles for something more economical, although last year more SUVs and minivans were sold than cars.

Others are snapping up the limited supply of hybrid cars, which combine a gasoline engine with an electric motor, despite the approximately $2,000 premium they command, generating waiting lists. (Buyers can claim a $2,000 tax credit on their federal tax returns, but that is due to expire in 2006.)

U.S. registrations for hybrid cars rose more than 25 percent last year, to 43,435, with Maryland ranking fifth in the nation. With gasoline prices rising and new hybrid models slated to hit the market this year, hybrid registrations are expected to increase even more, says Southfield, Mich.-based R.L. Polk & Co., which tracks automotive data.

The few models on the market are being snapped up faster than they can be produced, some dealers said.

"We can't stock them at all. It's on an order-basis only," Ritchie said of the hybrid Honda Civic he sells. "People are waiting for incoming units that haven't been built," typically up to four weeks. "It has been a quite of bit of interest since the price of gas got in excess of $1.70."

Sales of Toyota's new Prius shot up 62.4 percent in the first quarter compared with sales in the first three months of last year.

The roomier design and improved performance broadened its appeal, said Paul Taylor, chief economist for the National Automobile Dealers Association.

In March, Honda sold 2,725 hybrid Civics, the most ever in a single month.

"We have seen demand increase as fuel prices have remained high," said Chris Naughton, Honda's East Coast spokesman. Also, "the familiarity with hybrids is getting much better. Customers understand that you don't have to plug them in and that they require no special action by the driver."

For Steve Wolf, who commutes about 150 miles a day between his home in Frederick County and Springfield, Va., the gray Honda Civic hybrid he bought last month fit the bill. He had been driving a Saturn.

"I was looking for as high mileage a car as I could get," said Wolf. "I was putting all these miles on the car, and gas is going up. Everyone keeps worrying about gas prices going through the roof this summer, and we're not even to the summer yet. I was concerned."

Wolf's hybrid car has delivered on its promise of fuel efficiency, getting about 44 miles a gallon on the highway. While gas prices have climbed, Wolf estimates that he's saving at least $100 a month at the pump.

"I don't fill up as often, and the gas tank's not as big, so I'm making out on two fronts," said Wolf, a route manager for armored car company Loomis Fargo. "It's a typical small car; it doesn't give the ride of a Lincoln, but you don't expect that. It handles really well. This is a lightweight car and made for gas mileage."

At R & H Toyota in Reisterstown, the waiting list for the 2004 hybrid Prius is months long, as it is at many Toyota dealerships. Demand for Prius has outstripped supply since the roomier 2004 model came out last fall, said general manager David Russell said.

"But more recently, there's been interest from people who would not have had any interest in a hybrid, from the non-green types,'" Russell said. "Mainstream buyers have become more interested in the car knowing there's technology out there and knowing there's a cost savings in fuel overall."

One recent weekend, salespeople wrote orders for five, to add to the 30 or so waiting, Russell said. "We're selling all we can get," he said.

Toyota plans to introduce a hybrid SUV in the fall, and "there's a lot of interest in that already," Russell said.

Hybrid sales are expected to increase as manufacturers expand the offerings. Ford plans to introduce a hybrid version of its top-selling Escape SUV. Other hybrids coming out this year are the Chevy Silverado, GMC Sierra, Dodge Ram Pickup, Honda Accord, Lexus RX 400 and Toyota Highlander, models Polk expects to expand the market.

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