From: Jamie Butters, Detroit Free Press
Published October 8, 2004 12:00 AM

New Ideas Propel the Alternative Hybrid Cars to Mainstream

Oct. 8—While they are still derided by some as an uneconomical fad, gasoline-electric hybrid cars and light trucks are proliferating —and their sales volumes are growing, too.


Honda Motor Co. will begin selling its third hybrid car, a high-performance version of its popular Accord, this December, about the same time that DaimlerChrysler AG will roll out a diesel-electric Dodge Ram.


The new Accord — expected to cost about $30,000, or $3,400 more than a gas-powered Accord EX — combines an electric motor with a 240-horsepower, 3.0-liter V6 engine to boost the horsepower to 255 and cut the 0-to-60 time by half a second to 7.5 seconds, a Honda executive said in a presentation in Dearborn on Thursday.


The sedan also has EPA ratings of 30 m.p.g. in the city and 37 m.p.g. on the highway, compared with 21 in the city and 30 on the highway for a regular V6-powered Accord.


At the start of the decade, only two hybrids were on the market in the United States — the Honda Insight and the Toyota Prius. Both were new nameplates with futuristic names and looks. They also demanded compromises on space and power that limited their audience to true environmental devotees.


Now Ford Motor Co. is selling the first hybrid SUV, a gas- and electric-powered Escape, and General Motors Corp. has full-size pickups with mild-hybrid technology, which produces more modest gains in fuel economy than full hybrids, on the way to dealerships now. The trend is clear: As hybrids become more common, they are also taking the forms of familiar models.


"While the Prius has garnered a great deal of media attention in recent days, the future of hybrid technology is headed squarely down the path first cut by the Civic Hybrid almost three years ago," said Dan Bonawitz, vice president of corporate planning and logistics for Honda's U.S. sales division.


Whatever they are named, hybrid sales are growing and look like they will keep growing.


From a mere 17 Honda Insights sold in 1999, hybrid sales are expected to grow to more than 165,000 next year.


By far, the biggest piece of that would be from Toyota, which said last week it plans to send 100,000 Prius sedans to the United States next year — a move that Toyota says has nothing to do with Honda's growing lineup or the delayed introduction of its own hybrid SUVs.


"The Prius announcement is in response to our customers," said spokesman Irv Miller. "We still have months of backlog."


Governments are also playing a role in the sales growth.


A tax credit for buyers of certain hybrids — Honda's first two models and the Prius — was set to begin phasing out this year. But the Working Families Tax Relief Act of 2004, signed by President George W. Bush this week extended the $2,000 credit through 2005. It has not been determined which other hybrids will qualify for the tax credit, according to the U.S. Energy Department.


On the city-government level, GM plans to announce today that it is selling gas-electric drive systems for two buses in Stockton, Calif. This adds to the more than 300 buses powered by GM hybrid systems, said spokeswoman Susan Garavaglia.


In California, Gov. Arnold Schwarzenegger signed a bill last month allowing drivers of certain high-mileage hybrids to use the car-pool lane — officially known as a "high-occupancy vehicle" or HOV lane — even if only one person is in the car.


The only hybrids that qualify are those that average 45 m.p.g. — a list that effectively includes only the Toyota Prius and Honda Civic hybrids.


The new law won't take effect until Congress changes rules governing carpool lanes, which could happen late this year, according to the San Francisco Chronicle. The law would expire in 2008.


Ford complained that the efficiency hurdle amounted to a "buy Japanese" law, but it is unlikely that either Toyota hybrid SUV would qualify and Honda acknowledges that its new hybrid Accord won't make the cut.


In media test drives Thursday, the new Accord averaged 21 m.p.g. on a city route and 25 m.p.g. on the highway. A Free Press study earlier this year found that hybrids can get significantly less impressive mileage in the real world than they do in EPA tests — a criticism that also holds with traditional gas-powered cars.


The disappointment of some hybrid buyers echoed industry complaints that fuel-cost savings could never match the cost of providing two power sources and the components needed to coordinate them.


But as consumers become more familiar with hybrids, they may learn to temper their hopes of stunning fuel economy, just as they have learned that hybrids don't need to be plugged in to charge the battery.


"I think the consumer for this product is probably beyond that," Bonawitz said.


Honda expects buyers of the Accord hybrid to be highly educated, with incomes topping $100,000.


This would follow Ford's early experience, which found that those interested in the hybrid Escape were most often early-adopters of hot technology, more so than environmentalists.


"A lot of hand-raisers are luxury-type vehicle owners, people who want to be the first on their block with plasma-screen TVs and all that," said Ford spokesman Dan Bedore.


To see more of the Detroit Free Press, or to subscribe to the newspaper, go to http://www.freep.comĀ© 2004, Detroit Free Press. Distributed by Knight Ridder/Tribune Business News.


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