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AutoNation CEO says he has 600,000 hybrids sitting on lots across America

 

2010 ford fusion hybrid 027

The fuel-efficient but expensive technology just isn't in demand at current fuel prices and market conditions

The fuel-efficient but expensive technology just isn't in demand at current fuel prices and market conditions

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Pain at the pump is a thankfully remote sensation for most Americans these days. Just last summer we were all hurting everytime we had to go somewhere, to the point where we traveled 30 billion fewer miles than the year before. But the absence of pain at the pump means we don't have much in the way of incentive to pay extra for hybrid cars, and they are stacking up at the nation's dealerships.

AutoNation, a national dealership network based out of Fort Lauderdale, FL - America's largest car dealer - has over half a million hybrids sitting on lots all over the country, CEO Mike Jackson told the Boston Herald at The Wall Street Journal's ECO:nomics conference. The hybrid overstock is part of the larger problem of a 40% drop in sales over the last quarter of 2008.

All those cars are testament to the fickle nature of the market: the same consumers that have chastised the Detroit 3 for not being quick enough to hop on the hybrid train are now shunning all hybrids because they don't make financial sense.

Jackson is so desperate to turn around the consumer calculus on hybrids that he's even advocating a tax on gasoline that would push pump prices back up to the $4 mark we were all so afraid of. His argument: the taxes would somehow push down petroleum prices and keep money in the U.S. that would otherwise be exported.

If the largest dealer in the country is having trouble selling hybrids, the situation raises a serious question about the success of newly introduced hybrids such as the Ford Fusion and Mercury Milan hybrids, Honda's Insight (pictured) and others. Will they be able to trade on their strong efficiency as long as fuel prices remain low and consumer credit stays tight? Or will the Insight's sub-$20,000 price target mean it sells well while other hybrids fail?

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Comments (4)
  1. im sure that this 600k in overstock hybrids is proportional or still some what in line with the amount of overstock in general in the market. we fully remember the statements saying that hybrids in todays market only make sense if gas is over 3.50 per gallon.. which it is just no where near. but you can rest assured that gas prices will climb once this recession is over with..

    but to all those greens out there who said that the american people were voicing their concern about the environment by buying hybrids.. well those people need to listen to what i was saying.. people were just being cheap and were afraid of gas prices going even higher.
     
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  2. When Toyota is leasing freighters to store unsold cars, it is not unreasonable to expect that hybrids are also not selling.

    That being said last summer we considering a new car for my wife and we cross shopped the regular and hybrid Civic, based on her annual mileage the ROI on the hybrid would have been 13 years, with gas near $4/gal. No way did that make sense. BTW the market crashed before we acted and subsequently decided to wait.
     
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  3. I think it's worth remembering that car buyers are not as dumb as everyone thinks. The Insight, Prius III and Volt have all been widely publicized but are not available yet. Add to that the fact that money is tight right now. If I was planning to buy a new hybrid, I would wait a year or so for one of these next generation hybrids rather than buy one now. After all, unlike most cars, these cars actually do show more than incremental improvements with each new generation. Unlike the cars we're talking about, this isn't exactly rocket science.
     
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  4. Notice there's no break down of WHICH hybrids aren't selling. I'd take a wild stab in the dark and say they would mostly be to BS mild hybrids that US companies poored out trying and keep SUV sales happening. There's absolutlye NO WAY there are 500,000 Prius sitting in lots. Lets be realistic, how many other genuine hybrids are there on the market? A large starter motor and a large lead acid battery does not make a hybrid.

    Just another case of the big 3 making crap no one wants by the gross!
     
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