Will hybrid cars ever dominate the market? According to General Motors Vice Chairman Bob Lutz, the answer is no. Lutz recently stated that hybrid vehicles wouldn’t break the 10 percent market share point — ever. General Motors has been beleaguered by poor hybrid sales since the recession began. Although the company has eight hybrid vehicles on the market today, the company sold fewer than 500 hybrid models in the entire month of January 2010.
Right now, hybrid vehicles account for 3 percent of auto sales in the United States. The Toyota Prius continues to rank as the best-selling hybrid in the nation. Although Toyota’s recall woes have persisted for weeks now, it is unlikely that sales of the Prius will drop enough to allow a competitor to take over the top spot.
According to the Green Car Advisor blog, “Lutz for years has been skeptical of hybrids, arguing that while consumers say they want more fuel-efficient vehicles, most are unwilling to pay for the costly technology. Lutz has been a big supporter of the Chevrolet Volt extended-range electric car, which GM plans to launch this year. The Volt runs on a lithium-ion battery and has a small gasoline motor on board to keep the car running on longer trips.”
So Lutz is skeptical of less expensive hybrids but is a strong supporter of the Chevrolet Volt, which is going to be out of the price range of many Americans. Even if you take the recession, record unemployment, and shaky economy out of the equation, a $40,000 car with expensive-to-repair parts is not going to be a big seller. Even worse, with a $40,000-plus price tag, General Motors is still going to lose money on the Volt.
Now Lutz may be on track with his statement that hybrids won’t ever account for more than 10 percent of domestic auto sales. However, less expensive vehicles like the Nissan Leaf are likely to make more of a dent in hybrid sales than the luxury-priced Chevrolet Volt.