No pricking the Prius bubble -- yet

So far, the recent shrinkage (as George Costanza might say) of the oil price bubble hasn't brought much relief to buyers of another overpriced commodity — the Toyota Prius.

Data tracker J.D. Power & Associates reports that Priuses remained scarce on dealer lots during the first three weeks of July, even as gas prices began to inch down.

The gas-electric hybrids — which get the best fuel economy of any mass-produced vehicle sold in the U.S. — are staying on dealer lots for an average of five days. The average "time to turn" for all vehicles sold in the U.S. is more like 60 days, meaning that Priuses are basically arriving in showrooms already spoken for.

Some dealers around the L.A. area do have unclaimed Priuses in stock (Toyota of Glendale, for example). But Longo Toyota in El Monte, the world's largest Toyota dealer, has a three-month waiting list.

That scarcity has helped keep Prius prices in the fast lane. Kelley Blue Book, which tracks auto pricing, says Priuses are selling for $1,000 to $1,500 above the car's sticker price of $22,160 to $24,430 (depending on trim level) — and this at a time when overall auto sales are at recessionary levels. Used Priuses also command premium prices. That's especially true in California, where a Prius with the coveted HOV lane sticker — which are transferable to the new owner — can add thousands of dollars to the resale value.

Other hybrids, including the Honda Civic hybrid, which has fuel economy numbers almost as good as the Prius does, aren't experiencing the same level of demand. Libby thinks the Prius' distinction as a purpose-built hybrid — as opposed to a hybrid version of an existing model — is part of the reason for that.

Toyota recently said it would raise the suggested retail price of the 2009 Prius by $500. The automaker reportedly is set to increase Prius production by 70%, but analyst Tom Libby of J.D. Power said that won't help wannabe buyers anytime soon. Nor will modestly lower gas prices.

A bigger threat could be posed by the expected debut early next year of Honda's long-awaited hybrid-only car. Spy photos recently surfaced, taken during a Death Valley driving test. Although heavily camouflaged, the vehicle looked suspiciously like a ... Prius.

"If any manufacturer has the brand credibility to take on the Prius, it would be Honda," said Eric Noble, president of auto consultancy the Car Lab. "I'm not sure that overtly copying the Prius' exterior design was the way to do that, but it's apparently the way they've chosen."

Still, the hybrid Honda is expected to cost less than a Prius. And that could finally take a bit of the air out of the Prius bubble.

— Martin Zimmerman

Photo: Toyota

Comments

[Ellen Hilburn]

I still don't understand why Toyota is beating Honda on their Hybrids. Hasn't Honda's Hybrid consistently beaten Toyota's in about every category? Strange.

[Steve Zuckerman]

Shows how out of touch American car makers have been... The price of gas going up was evidently un-noticed by them along with our fearless leader, Bush. They act if as they were blindsided by these events; In truth they were all asleep at the wheel, or worse. A real leadership in this country would respond like Roosevelt did with the new deal. Creating jobs and technology to transform the energy infarstructure from oil to natural gas and green production of electricity and revitalizing the economy. Any other response is a "put the money in your pocket now" non-solution. Drilling for more oil is shortsighted and futile. Here we are 8 years into some of the most destructive governmental policies we as a people have ever endured and now the time is coming when we are all going to have to pay. Big time.

[peter C]

The part I don't understand is that years ago there was so much talk of incentives, tax-breaks, etc for American car makers to develop hybrid technologies, etc. And for those efforts, Ford has 1 or 2 models? GM has 1 or 2 on the way? Honda and Toyota have had PRODUCTION models for years. The over-sticker-price premium is just a function of people voting with their dollars, and in a free market I don't see anything wrong with that. My whole point is that I don't know if Honda and Toyota has received any type of money for their development of hybrid technology, but here they are with road-tested cars, and American car makers are late to the party. Remember how many recalls the Ford Focus had? Curious to see how their hybrid shakes out, but you won't see me buying one. As an aside, Yaris and Fit are Japanese models, with the R&D costs paid for years ago, selling like crazy here in the US. Another example of Japanese car makers finding the sweet spot, adapting, and getting ahead of the curve.

[richard schumacher]

Ellen, what categories are you thinking of?

[laars]

Zuckerman: If your hero Bill Clinton had not vetoed the Alaska drilling law that the Congress passed, we'd have 2 M barrels per year more USA oil and prices around $2./ gal. Drill here, drill now, pay less. It is the LAW of supply and demand, not some half baked wet dream of wind driving anything.

[Steve M.]

Hey Laars,

Calling your bluff. 2 mil barrels more a year is a drop in the tank. $2/gal huh? That number sounds ridiculous.

Care to substantiate your wild claims with supporting facts?

[Jason M]

2M barrels a day might drop the price $.05 a gallon. Forget the Prius, go find a Metro for $1000. Gets better gas mileage, and your recycling an old car.

[james]

"...if your hero Bill Clinton had not vetoed the Alaska drilling law that the Congress passed, we'd have 2 M barrels per year more USA oil and prices around $2./ gal."

So who wants $2/gal gas? I'm ok with $4/gal, because I've got a car that gets 70 mpg. I just hope that by the time it goes to $6 or $8, I can buy an Aptera or something that gets 120 mpg.

And for all you whiners in your guzzling SUVs, just this: if you're feeling the pain, just remember that it was a self-inflicted wound :-)

[SCY]

Actually, estimates by the Energy Information Administration are that ANWR petroleum would have the affect of reducing gas prices by 41 cents per gallon, based on 2006 prices. And ANWR only accounts for about a tenth of the estimated reserves here in the United States...quite frankly both Bush and Clinton and every other President since Carter have failed on the question of energy but all you partisan hacks insist only on blaming the opposite side...

[Kirk]

Hey SCY...

The Energy Information Administration estimates that ANWAR petroleum could reduce OIL prices, not gas prices. By 41 cents a BARREL. Not per gallon. That amounts to savings of under one cent a gallon.

Using your estimate -- now dubious -- that ANWAR does account for about 1/10th of estimated U.S. reserves, then we can drill America dry, rip it all up, to save 10 cents a gallon. Oh, and then what?

What do we do when there's no oil left to drill, which would occur in a matter of a few decades at the very most? And with the marketplace fully aware of these limited future reserves, what would happen to the price of gasoline in the years leading up to the day we exhaust our oil reserves? It's a recipe for disaster.

Forget partisanship. Here are facts. One man, McCain, actually believes more drilling is an answer. Science and math tell us that can't be. Another man, Obama, understands science and math -- and economics -- and offers a detailed energy plan to wean us off of this dwindling (and toxic) resource.