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Green-Car Disconnect: Unrealistic Expectations, Tight Wallets

December 8, 2009

If you've been following news about the latest green cars—either here at or at our companion site //—you're likely aware that the technology doesn't come cheap. Plug-in electric vehicles, EVs, and even clean-diesel vehicles are all likely to cost quite a bit more than their gasoline equivalents. With the 2011 Chevrolet Volt expected to approach $40k, even after federal incentives knock the price down significantly it will still be more costly than the average new car and well out of reach of a lot of buyers who would really rather go green.

And to a related point, expectations of green-vehicle shoppers can often be unrealistic, whether it comes to expecting boast-worthy, small-car mileage figures out of a full-size hybrid SUV or forgetting that, to use an EV or plug-in (ideally), you'll need somewhere to plug in.

2009 Cadillac Escalade Hybrid

2009 Cadillac Escalade Hybrid

AutoPacific analyst Jim Hossack says that just as 98 percent of Dodge Viper owners counter-intuitively ask for more performance among the top things they'd want to change about their vehicle, owners of green vehicles are zealots for ever-higher mileage numbers and want the bragging rights they provide. "They want a really big number," he says, otherwise they tend to dismiss the vehicle as not worth as much. And the Prius sits as a sort of gold standard that mpg-minded green shoppers will inevitably weigh vehicles against regardless of size or performance.

Some worrisome results of a study released last week only serve to emphasize that point, concluding that a significant portion of green-car shoppers have unrealistic expectations for pricing for these vehicles, expecting more…for less.

According to data, from the California-based market-research firm AutoPacific, a modest segment of those considering hybrids, plug-in hybrids, and pure EVs (10, 17, and 19 percent, respectively) agreed with the statement, "I am prepared to pay a higher price for an environmentally friendly vehicle," yet when asked about price expectations, they plan to pay, typically, $2,000 to $5,000 less than those considering gasoline vehicles.

When asked independently how much they'd pay for a next gasoline vehicle, the average price was around $30,000; for hybrids it was a bit lower, at $28,000; and for EVs the average expected price was nearly $25,000.

It's from a study called "Green Cars and Consumers, Planninig for a Changing Market," and includes survey responses from more than 32,000 owners and those considering gas, hybrid, plug-in hybrid, pure electric, and clean-diesel light vehicles.

A smaller study from Pike Research earlier this year—covering just over 1,000 consumers—found that 65 percent were willing to pay a premium price for a plug-in EV, but on average that premium was just 12 percent over the price of a standard gasoline vehicle. That's a price point met today by some hybrid models, but plug-ins are expected to ring in at much higher prices.

2010 Toyota Prius Plug-in Hybrid Concept

2010 Toyota Prius Plug-in Hybrid Concept

"Finding buyers for these vehicles will not be like the early run we saw for the Toyota Prius," cautioned AutoPacific, in a release accompanying its study results, noting the importance of honing in on certain market demographics that might be truly willing to foot the additional cost of these vehicles.


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