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Hybrid, battery-electric cars: will the hype lead to sales?

October 27, 2010 |  6:00 am

Chevrolet-VoltDespite the flurry of attention surrounding the Chevy Volt and Nissan Leaf, hybrid and battery-electric vehicles are likely to account for just 7.3% of the 70.9 million passenger vehicles sold globally in 2020, according to a study released Wednesday by J.D. Power and Associates.

According to the Drive Green 2020 Report, the main reasons U.S. car buyers do not consider buying hybrids are cost, displeasing designs, performance deficiencies and maintenance concerns. Those who consider purchasing hybrids but ultimately buy internal-combustion vehicles do so because the cost of the hybrids is too high and the performance, i.e. acceleration or towing capacity, is inadequate, the report said.

Alternative drive-train vehicles cost 25% to 30% more than their internal combustion counterparts, said Tim Dunne, director of global automotive operations for J.D. Power in Westlake Village, Calif. It follows, then, that buyers of alternative-propulsion vehicles come from a fairly high income bracket. According to J.D. Power, the annual median household income of a hybrid buyer is $111,000 versus $91,000 for so-called gas buyers. 

"There are a lot of unknowns in the market," Dunne said. "At the end of the day, consumers want to do the right thing, but they're going to consider how it impacts them financially first. The price to the consumer is paramount if you really want success."

The Drive Green 2020 Report was compiled using data from the world's four largest passenger-vehicle markets -- China, the United States, Europe and Japan -- and included a review of each country's governmental regulations and economic climate, along with customer and automaker interviews.

The report forecasts the U.S. as the leading market for hybrid vehicles by 2020; it predicts 1.7 million hybrids will be sold in the U.S. that year. Europe and China will be the biggest buyers of battery-electric vehicles; U.S. sales are forecast to be only 100,000 annually in 10 years.

"While many people are interested in reducing fuel consumption and improving emissions," Dunne said, "there's no coordinated global policy in terms of how to achieve that."

-- Susan Carpenter

Photo: A Chevy Volt. Credit: General Motors

 

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