Electric-car makers lower prices in race to catch Toyota’s Prius

This does not make a lick of sense but it sounds like the experiment is on.

Bob Wilson

 

Toyota hybrid nation, 5 million strong.

DBCassidy

 

got your sticker yet????

 

tough to steal hybrid sales with 'high anxiety vehicles'.

 

...makes for some great Plug-In deals in USA. The Federal tax credit (up to $7500) was based on the idea that EV's are quite expensive. But with low Plug-In prices (due to dealer incentives) Plug_ins could be the cheapest solution for a new car in quite a few households.

 

They make for a great first car for teen drivers. The overnight charging session complements curfews.

 

That's actually a really good idea. I will be buying a car for my two older daughters in the next year or two and with
the incentives it would work out to about a $21k car which isn't bad. Assuming of course both the Fed/State rebates are available then. We just purchased a Prius v but looked at the Leaf and concluded the range limitations would not work for us and it was just too small for a family of 5 as a second car.

 

Good to know they won't be using the old "Oh baby, we ran out of gas" line.

Bob Wilson

 

They're not going after the Prius. They're trying to meet California's clean car quota. The electrics aren't selling quite as well as they hoped. If they don't meet the sales quota, they can't do business in California - a market too big to ignore. Or as Wall Street Journal's Dan Neil put it:

"Yeah, well, tough. It's the cost of doing business in the biggest vehicle market in the U.S., and a plain-fact acknowledgment that the automobile has public costs—impacts on air quality, climate and health, infrastructure, injury and death. Lest we forget. You can take issue with California's zero-emission vehicle methodology, and you can reach different conclusions with regard to electric vehicles' value to consumers; but it's inarguable that car companies have an obligation to clean up the mess they make."

Fiat 500e Review: The Bosses Don't Love It, but You Will - WSJ.com

 

Recently an Autoline Daily report on the rapid depreciation of the Volt and Leaf reported:

• Used, they have no tax advantage, so the subsequent sale prices have vastly declined
• Early adopter cars are coming off lease

So to stay in the California market, selling EVs is the 'business tax.' But without a tax advantage, the used ones have become a buyer's market.

Bob Wilson

 

Bob,

The "rapid depreciation" simply reflects the $7,500 tax credit available on the new vehicles. I have been watching, not focused though, the resale values for off-lease Volts. We leased the Volt my son is driving, mainly to help him establish credit as a new college graduate. The resale values seem to be inline with the lease residuals so far. He loves the Volt, especially not having to put gas in it. During the 9 months I drove the Volt I learned that I can easily live within the range of current EVs so it looks like I will be getting a model X next.

 

Thanks, I've long wondered if the tax credit simply increased the sale price of subsidized vehicles. When Prius were in short supply with waiting lists and dealer markup, there was a subsidy. But once the subsidy ended, the waiting lists and markups seemed to disappear. But I don't know how to quantify the 'price inflation' effect of this subsidy.

A fan of using Ebay completed sales to get the 'fair market value,' I may take some time to see what sort of complete sales exists for both the "Leaf", "Volt", and equivalent model or sized gas cars.

Bob Wilson

 

When I replaced a totaled 2006 Prius with a 2007 Prius it seemed like Toyota had just started discounting $2,500 off of the MSRP, in effect replacing the federal subsidies. The manufacture would argue that the tax subsidies translated into markup and the markup translated to gross margin dollars to recoup r&d and ramping production for new technologies.

If a $33K vehicle temporarily sells for $40k for a few years and then settles in at $35K is that a bad thing?

 

Do tax incentives affect demand? Sure. Do they increase demand or just shift demand? At least during some of the time the Prius was selling for MSRP gas prices were rising to record levels and dealers wouldn't take SUVs in trade.

When the recession hit, the bottom fell out of the auto market. the Gen 2 was at the end of the line and there were MY leftovers on the lot for the first time. Gen 3 sales started out at MSRP, were discounted by December 2009, and went to invoice in 2010.

I don't believe the tax policy raised the price. It wasn't advertised or mentioned, even at the dealership. It may shift demand, and definitely shifted demand when it was close to expiring. Are you going to buy an EV in NJ just because there is no sales tax? No. With the cash the manufacturer is placing on the hood and the tax credits more people can at least consider the car. They are increasing demand in a soft market, not increasing the price.

Tesla's in a good position now with more orders than production. What happens when production catches up and exceeds the order rate? When does that occur? VW enjoyed it with the New Beetle and Chrysler with the PT Cruiser, both discontinued.

 

On order.

DBCassidy

 

Ain't that the truth!!!

DBCassidy

 

Only when, as the article pointed out: sales slumped 25% in the first months this year and 63% for the month of May in Canada.

Yes its a bad thing.

DBCassidy



DBCassidy

 

You should be focused on off lease Volts, some great deals will becoming forth. Establishing credit for your son will be easier with a great buy on a previously leased Volt. Also, with ownership, no issue with returning the car at lease end and worrying about being charged for minor blemishes on the vehicle.
Your son also learns to take responsibility of a car that he will own, once it is paid off.

He will love the freedom of no more car payments upon the payoff of the car loan too.

It doesn't get any better than that.

DBCassidy