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Hybrids Hit Hardest


Auto sales are down significantly in the short term, so much that the least-viable manufacturers are taking a lifeline from the US Congress. Congress has made no secret that they intend to wiggle their end of the rope to force greater production of fuel-efficient vehicles. But that class of vehicle has suffered the biggest drop in demand:

US hybrid petro-electric sales in November shrank 53 per cent from a year earlier, compared with a 37 per cent drop overall, according to Autodata, a market-research firm. December sales, to be announced on Monday, are to show a similar trend.

Sales of most hybrid models have dropped sharply. Demand for Toyota’s Prius hatchback, the top-selling hybrid, fell by almost half in November from a year earlier. The Camry sedan was down 57 per cent, and the Ford Escape crossover 35 per cent.

The relatively greater decline is likely the result of people being smart with their own money:

Hybrid vehicles typically cost $3,000-5,000 more than their petrol equivalents. Toyota has used up tax credits available for hybrids, and several other manufacturers are close to their limit. estimates that a Prius owner must now wait more than eight years to recoup the extra cost of the vehicle in fuel savings, compared with three and a half years when the petrol price climbed above $4 a gallon last spring. The average price is now about $1.61.

Faced with the price of their own beliefs, the environmentally-righteous have trouble walking their talk. Congress has allowed believers to transfer the cost of faith somewhat (due to those tax credits). If lawmakers succeed in forcing excess production of hybrids, they’ll then claim to be justified in expanding the tax credits handouts to hybrid buyers.

Why would anyone follow an economic prescription from the same wagon of bozos that can’t even run their own lunchroom? Because it takes no business savvy to play Robin Hood. And even those with a conscience can be persuaded take stolen doubloons when the thief tells you it’s good for the environment.

H/T: Naked Capitalism