Friday, January 21, 2005

Hybrid cars: Why sales are growing at a slower pace.

Every year 15 million new vehicles are sold. Last year 88,000 hybrid cars were sold in United States. This year the projected figure for sales of hybrid cars is 220,000 as per estimates done by J.D. Power and Associates. Why people are not willing to buy hybrid cars in large numbers? Lets take a look at some of the possible reasons:

1. Speed. Hybrid cars are not so fast as cars that run on only gas. Why? Technology
Hybrid cars do not have high speed as in gas only cars. They run on battery assisted small engines. Theoretically, I am not sure if hybrid cars could match the speed of the gas only cars in near future.

2. Not enough advertisements/promotion for hybrid cars.
You start your TV sets or listen to the radio, you get a lot of ads for monster, gas
guzzlers suv and cars run by only gas. The ads ratio could be 1 in 10 for hybrid cars as compared to general cars.

3. Lack of awareness.
Govt. is trying its best to promote hybrid cars by making public aware of the benefits for hybrid cars. California and Virginia are allowing hybrid cars in car-pool lanes though there is no federal approval till date for such policy. However, is this enough? Why so delay in approval of such policy. As I think, the following steps could be taken:
a) Federal approval for different incentives for people buying hybrid cars
b) Heavy tax incentives for hybrid cars buyers
c) Higher registration fees for purchase of non-hybrid vehicles.
d) Free parking for Hybrid cars
e) Set an example by replacing all the state owned cars to hybrid cars

4. Fuel prices are high but manageable.
This could seem vague but I am of the opinion that increase the prices of the fuel
to something like $3+. I know I would not have many takers for this but can't help. Extreme steps taken now could prove beneficial tomorrow.

5. Lack of Choice
If a person wants to buy a hybrid cars he has got very less choice as of now. He
has to select between a few. Now, if hybrid cars will not go neck to neck with general cars, it will be difficult that carmakers would speed much in research for hybrid cars due to less demand. Now what about something like state sponsored research for hybrid cars.