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April Not Any Better For Prius Sales

Discussion in 'Prius, Hybrid, EV and Alt-Fuel News' started by Danny, May 1, 2009.

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  1. Danny

    Danny Admin/Founder Staff Member

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    Last month I told you about the sales slide the Prius saw in March, and today the April numbers were released and actually look WORSE. Toyota sold 8,385 Prius units in April, down from 8,924 units last month. Last April was when sales really started to kick into gear (before gas really even started going up), but this April sales were off a staggering 61% compared to April 2008. 2009 Prius sales are down almost 50% compared to 2008.
    There are several questions surrounding these numbers:
    1. What is the cause of the sales decline? Cheap gas, bad economy, new generation model?
    2. Will May be a better month with heavy discounts on 2009 models and eager early adopters of the 2010?
    3. A year ago we were talking about the Prius taking the #2 best-seller spot from the Corolla. Is that still a viable expectation for the future?
    I think the answer to question 1 is that it has more to do with cheap gas and a bad economy than a new generation coming out at the end of May. A majority of future Prius owners don't even know that the 3rd Generation Prius is coming out this summer.
    I'll let you answer questions 2 and 3!
    Toyota Reports April Sales
  2. Paradox

    Paradox Prius Enthusiast / Moderator Staff Member

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    I sure hope that besides the economy holding people back from purchasing, these numbers are low because people are waiting for the arrivals of the 2010.
  3. Matt Herring

    Matt Herring New Member

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    "Quote: Last month I told you about the sales slide the Prius saw in March, and today the April numbers were released and actually look WORSE. Toyota sold 8,385 Prius units in April, down from 8,924 units last month. Last April was when sales really started to kick into gear (before gas really even started going up), but this April sales were off a staggering 61% compared to April 2008. 2009 Prius sales are down almost 50% compared to 2008.
    Read the Full Story"

    The statement that last April "sales really started to kick into gear (before gas really even started going up)" is completely false.

    Tell me about it...but give me a source to prove it. Below are links to current US average gallon gas cost, last March and last April. Yep, we're in a recession and people are not buying cars as much as they did last year...but...gas had already started going "up" last March and April and it's hasn't even approached those levels with today's prices. As gas approaches $3 a gallon people (and about the same time the Gen 3 Prius comes out...good timing) people will start thinking about buying a hybrid. At $4 a gallon we'll see lines in the parking lots to buy them.

    Current US average gallon of gas cost...$2.04
    Gasoline and Diesel Fuel Update

    Last March US average gallon of gas cost...$3.16
    U.S. gas prices?March 3, 2008: Consumer Reports Cars Blog

    Last April US average gallon of gas cost...$3.39
    Average gas prices?April 14, 2008: Consumer Reports Cars Blog
  4. PriusLewis

    PriusLewis Management Scientist

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    Normally at any given time cars are dieing and going to the salvage (moving cars off the bottom of the automotive food chain) and new cars are being sold (moving new cars in at the top of the food chain). In between is the used car market, and cars move down the market as they age. This attrition rate is easy to predict and relatively constant based on vehicle miles driven over a given time frame.

    With the current economy people are hanging onto their current car longer and spending money to have it fixed. This is a short-term solution, as cars continue to age and get scrapped. This leads to pent-up demand. People will start satisfying that demand when they believe their job is safe and they can afford to go buy a new car. Edmonds Daily claims this backlog in demand is currently at 4 million vehicles (average of vehicles sold in 12 month periods in previous years compared to vehicles sold in the last 12 months) (MacKinnon, 2009). The Auto Channel predicts there could be a buying surge with relatively small gains in economic stability (Ouellet, 2009).

    References:

    MacKinnon, B. (2009, January 28). Are You Part of the "Pent-Up Demand" for New Cars? edmondsDaily. Retrieved May 1, 2009 from http://blogs.edmunds.com/strategies/2009/01/are-you-part-of-the-pent-up-demand-for-new-cars.html

    Ouellet, D. (2009). Strong Pent-Up Demand for Cars in the U.S. Retrieved May 1, 2009 from Strong Pent-Up Demand for Cars in the U.S.
  5. Codyroo

    Codyroo Senior Member

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    I think that May sales will likely be flat or, perhaps, a slight improvement. Discounts and (potentially) a new model will flatten out the decline. But if the public doesn't feel as if the economy is recovering, they will not pull the trigger on a car purchase. Why take on an additional expense ($300 - $500 car payment) at this time when so many things are up in the air?

    The Prius will surpass the Corolla, but it may be a bit of a long horizon for that to happen. When gas prices take off again (and you are fooling yourselves if you don't believe that will happen), sales of Corollas ought to do well, since it gets good gas mileage but will cost less than a Prius. Once the economy is such that people have confidence that they won't be losing their jobs and can afford more "luxurious" items, the Prius sales will surpass the Corolla.

    My 2 cents.
  6. Danny

    Danny Admin/Founder Staff Member

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    Matt, I appreciate the research you did on gas prices, but I still think that $3.39 was nothing compared to what happened at the peak and end of the summer. Gas here in the southeast was $4.50 in September after the hurricanes came through the Gulf. We had 3 weeks of shortages and saw prices never seen before in this part of the country.

    This summer gas is not expected to top $2.30/gallon. I wish it was going to be over $3 again, but it's just not going to happen.
  7. BH1973

    BH1973 Junior Member

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    There is going to be a fire sale on the 2009s when the 2010s hit the showroom. Dealers have dozens of them on the lots. I'm thinking 19k gets you a 2009 #2.
  8. Matt Herring

    Matt Herring New Member

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    Danny,

    There are certainly many factors that go into what causes a person to drive to their local Toyota dealership and buy a Prius but overall worldwide economic skepticism has to be the #1 factor right now.

    Across the board (except for very few) all makes and models sales are down. And, my best guess is the Prius sales figures from a year ago were inflated beyond what other makes and models were able to sell (the Prius being the hottest model out there a year ago for the average impulse buying consumer to be attracted to...thanks to outstanding results and even more outstanding marketing/advertising). While sales are down from a year ago, a month ago, etc. the Prius' sales figures are also being compared to itself (a high sales bar to achieve) and not other vehicles. When you're #1 in your class it's difficult to match or exceed your sales figures when you're comparing them to peak figures.

    The Prius is in great shape in the market despite other competitors pushing out new hybrid models (Chevy, Honda, Ford). Toyota has seemed to reinvigorate their Prius models every time they roll a new one out that captures the eye of consumers and makes it the "newest, coolest, most efficient car to own.

    Current economy, moderate gas prices, job loss, etc...they all have put a dent in sales figures but the Prius remains #1 with a solid track record to continue that status. Not to mention the Gen 3's highly anticipated arrival will only help sales of the Prius (and not just the 2010 model...the 2009 models will get a good sales boost from deal hungry consumers as well as Toyota's increased advertising and marketing on the 2010). It won't be at last year's pace but still #1.

    In regards to gas prices...you are probably correct...I would be surprised to see gas much higher than $2.30 a gallon from June - August (barring catastrophic events). Oil is at roughly $53 a barrel and demand is at it's lowest in a decade (source in link below)...

    The Associated Press: Oil settles above $53; manufacturing declines slow
  9. snead_c

    snead_c Jam Ma's Car

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    How were the other US auto sales in April ? I bet similar.
    With the Big three in serious financial trouble (Ford so-so) many folks will see the local dealers closing, brands disappearing, watch gloom and doom on tv news, and sit on unneeded new car purchases.
    Secure jobs and positive moderate term financial growth will drive buyers to seek wise auto investments...the eventual $3.60+++ gas prices will greatly stimulate this movement.
    Our auto choices are narrowing and Toyota seems poised to fill early needs with great vehicles across the line.
    Let's hope and pray the "recovery" really is starting soon...:cheer2:
  10. snead_c

    snead_c Jam Ma's Car

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    Because I'm a slow typist I missed Matt's summary...right on and wish I'd said that!
  11. Matt Herring

    Matt Herring New Member

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    http://www.hybridcars.com/hybrid-sa...hboard-did-hybrid-sales-bottom-out-25712.html

    Need I say more...page about halfway down the article and see the charts on March 2009 US hybrid auto sales.

    Quick View:
    21,433 total hybrids sold in US in March
    8,924 Toyota Prius (41% of total market for March)
    2,554 Toyota Camry (12%)
    1,037 Toyota Highlander (5%)
    Total Toyota Market Share for March (64%)

    Only the Honda Civic (13%), Ford Escape (6%) and Lexus RX400H (5%) are even in the picture...and obviously the Prius is far-far ahead of any other model. With the Gen 3 due out soon those numbers will be staggering compared to other makes and models. The Prius is doing just fine right now compared to its competitors.
  12. Matt Herring

    Matt Herring New Member

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    Posted same info. twice...sorry!
  13. hampdenwireless

    hampdenwireless Active Member

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    Its all three factors, down economy, cheap gas and the 2010 change. I am sure the first full month the 2010 is available they will largely be sold nearly as fast as they are delivered.

    The 2009's are cheap at dealers now but not 'bargained priced' yet. When a #2 is $19000 or less they will be a bargain and you would be a fool to buy the Insight instead. (though personally I would recommend the Prius over the Insight in most cases anyhow)
  14. okiebutnotfrommuskogee

    okiebutnotfrommuskogee Senior Member

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    No fire sale around here. Both of the Toyota dealers here each have or had a SPM Touring in stock for a relatively long time. Our SPM 2007 only has 15,000 miles on it and is basicly like new. I have tired to trade with each of the dealers to get the touring model because it had more neat stuff on it.

    About the only thing I can say about them is that they are consistent, in that they don't want to sell a car very bad, even though the 2010's are about here. Looks like they would want to get rid of the 09's. Both of them wanted over $12,000 difference.

    One of them has since sold the car I was interested in. The other one still has the car, in fact, they gave me a follow-up call this morning. I really wanted to up-grade, but we will never make a deal because I am offering them much less.
  15. Matt Herring

    Matt Herring New Member

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    If the 2010's are flying out the door I would suspect the 2009's will take some time to come down in price. After all, it's not like the 2009's are a bad buy just because the 2010's are available.

    Hey, my sigs are working...cool!!!
  16. Gokhan

    Gokhan Member

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    I think the reason is that the 2009 Prius is highly overpriced, by at least $2,000. 2008 Prius was reasonably priced but when the gas prices went up the roof, Prius prices went up the roof along with it, with Toyota speculating in more profits. It worked initially but not after the gas prices fell again.

    Unlike the 2009 Prius, 2010 Prius seems to be priced right; so, the sales should rise again. Also the 2010 model has substantially higher quality in comparison with the 2009 model from what it seems so far but we will have to wait for the Consumer Reports review.

    There are many factors when people consider buying a car: looks, performance, MPG, comfort, technology, safety, cult appeal, and price. Price is the most important factor. Prius is high on MPG (near 50 MPG was not unusual in fuel-efficient, conventional-gas-engine cars of 80s but nowadays is considered a miracle), technology (hybrid system and the advanved-technology package), and cult appeal (as in Apple®) but low on looks and performance (as in poor steering and cornering typical with Toyotas). Buying decision is made after the highs and lows are weighed but then price becomes the ultimate factor.

    Also note that Toyota has announced that they will drop the prices of the 2009 models immediately once the 2010 models go on sale, simply because the 2009 models currently cost more (by at least $2,000) than the higher-quality 2010 models that are comparably equipped.

    With the economy far from recovering and more competition in the hybrid market with Insight, Fusion, etc., prices will drop down even more next year. Yet, more advanced features, newer engine technologies, newer fuel options, much better MPGs, and new plug-in technologies will arrive in multitudes in the future.
  17. PriusSport

    PriusSport senior member

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    With $2 gas, there is no reason why anybody wants a hybrid over an ICE car, like there was when gas was $4. Global warming? LOL. Half the public doesn't believe it.
    The lack of leadership in Washington and the timidity of the media have made it almost a non-issue. That could change fast, however, when Obama's program on reducing carbon emissions gets going. And if gas prices climb. Hybrids are still too expensive relative to other fuel efficient cars, to offer any incentive for buyers. Besides, nobody is buying any car right now.
  18. fuzzy1

    fuzzy1 Senior Member

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    Note that 1980s-era EPA ratings are not equivalent to today's ratings. 50 mpg today is a much high bar than 50 mpg back then, even without the added weight of the newer safety equipment.

    A check of Fuel Economy.gov finds that Prius and Insight lost 9 to 11 mpg when the 2008 EPA revisions were put in place. I think there was another revision cycle in the 1980s that also pushed scores downwards.
  19. ken1784

    ken1784 SuperMID designer

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  20. Gokhan

    Gokhan Member

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    That's exactly why the EPA link I gave above lists two different sets of numbers: 52/57/54 with the 85 - 05 test method and 42/51/46 with the 06 - present test method. So, it's a fact that some conventional-gas-engine cars in the 80s got fuel economy comparable to that of Prius II & III.
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