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Prius Tops 1 Million

Prius with environmental message

Prius with environmental message

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What began as little more than a technical curiosity has moved solidly into the mainstream. Toyota Motor Co. just sold its 1 millionth Prius, the world’s first mass-market hybrid-electric vehicle. Introduced in 1997 in Japan and two years later in the United States, the Prius is Toyota’s environmental flagship and easily the most recognizable “green machine” on the planet.

In its early days, Prius had little competition, initially only the Honda Insight, a teardrop-shaped two-seater that actually beat Toyota’s offering to the States, but never really charged up consumers. Today, Prius is being sold in more than 40 countries, and with gas prices surging to new records, almost by the day, it is also drawing a flood of new competitors. Toyota alone has added an assortment of gasoline-electric vehicles, including hybrid versions of the Camry sedan, and several of its Lexus luxury vehicles, such as the RX 400h crossover/SUV. By decade's end, Toyota hopes to be selling as many as 1 million hybrids annually, worldwide.

But manufacturers ranging from General Motors to Mercedes-Benz aren’t content to let the Japanese giant dominate the emerging hybrid segment. GM has been rolling out an assortment of its own hybrid offerings, ranging from so-called mild hybrids, or “mybrids,” like the Saturn Vue Green Line, to full-featured models, like the new Cadillac Escalade Hybrid. Ford Motor Co. was first in market with a gas-electric SUV, the Escape Hybrid. And Mercedes is working on several offerings of its own, possibly including a diesel-electric.

The big challenge is to take the technology to the next step – while also driving down costs. Diesel-electric systems could double the premium for hybrid technology. Advanced battery systems, notably new lithium-ion technology, could yield still better fuel economy, and GM is one of several manufacturers hoping to market a plug-in hybrid. Actually, the U.S. maker prefers the term “extended-range electric vehicle,” since its Chevrolet Volt will be able to run for up to 40 miles solely on battery power. But once it runs out of juice, Volt’s internal combustion engine will kick in, providing it the unlimited range of a gasoline-powered vehicle.

And as TheCarConnection reported several weeks ago, Nissan is now working on a pure electric vehicle that it hopes to launch in the U.S. in 2010, initially for fleet customers. Retail sales are set to begin in 2012.

But despite their ambitious plans, these manufacturers still have a lot of catching up to do. Prius was not only the first hybrid to hit market. It is now one of the most recognizable products in the automotive world, and that’s giving it a significant head start as Toyota aims to reach 2 million in sales.
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Comments (4)
  1. The lengthy article tells us nothing we do not know, and does not tell us what we do not know, ie; whether Toyota is still losing $10,000 on every single hybrid it makes. I suspect they no longer lose $ on the Prius, but they could sure lose a bundle on all these other hybrids they sell that look just like the non-hybrid models and produce rather lousy MPG for hybrids.
    As late as this year, I hear that GM is indeed losing $10,000 on every Tahoe Hybrid it makes/
    THIS is the kind of info that is of interest.

  2. Thanks, Ed, but sadly, without inside access to Toyota's arcane accounting system, it is absolutely impossible to know whether it is -- as it claims -- now making money on the Prius. My own sources suggest that on a running basis, not counting the clearly hefty up-front charges, Prius probably is at least slightly in the black.
    As to GM, it is all but certainly losing money on all its hybrids, even the mild or "mybrid" models, such as the Saturn Vue Green Line. Troy Clarke, head of NA operations, all but confirmed this to me, recently, and said, point-blank, that GM expects to lose money on the Chevy Volt for at least a couple generations. That appears to be the operating business principle for the full, 2-mode hybrids, such as Tahoe.
    Check my article of earlier this week regarding the Ford Escape. Curious that the automaker does not have plans to expand production capacity for the HEV, even as it boosts sales of gas-only Escapes. Why? Well, if you ask, on the record, anyway, you get some convoluted answers. Off-the-record? It costs Ford too much, per unit. There is, apparently, a point at which it makes economic sense to accept a hybrid's losses, whether for PR value or for the long-term cost of tech know-how. Beyond that, Ford seems unwilling to go, even if market demand is there.
    Paul E.

  3. Thanks for the comprehensive reply. It reinforces my own guesses. Lutz had said it blatantly, that GM should have thrown $100mill at hybrids when TOyota did, not because they make any sense, but for the PR value. Europe took more than a decade to take hybrids seriously, despite the $8 gas there and $9 in oil exporting Nowray!). Diesels can do a far better job for most people.
    Hybrids are ideal for city fleets of taxis and mail trucks and esp. police cars idling all day long. Not for the private owner, who either does a lot of miles (but highway ones) or a few mostly city miles. In either case, despite the heavy company and Govt subsidisation, Hybrids make no sense for the 1 million private owners that bought them. But their show-off value and their video-game appeal is significant. That explains why the prius sells so well, while hybrids that look just like their non-hybrid counterparts, like the Civic Hybrid, don't.

  4. Paul,
    Ed's comments need to be challenged. I am a 2 Prius owner and they do make a lot of sense. Yes, they do get great mileage around town but even better on the highway - consistantly over 50 mpg in both of mine. Compared to a 25 mpg sedan, I save about $1,200 per year on fuel. More importantly, about 5,000 fewer pounds of CO2 annually. And as for show-off value why doesn't Ed talk about the millions of people who bought huge SUV's and pick-ups to show off. At least the Prius owners are "showing" that it is possible to protect our environment, and move towards energy independence. Whether they are labelled "hybrid" or not, big heavy vehicles are modern day dinasours. The faster they become extinct the better off we will all be.

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