US Sales of Hybrids Down 8.9% in September

It's completely a production issue. There's waiting lists at most (all?) dealers, and time the vehicle spent on dealer lot is now about 48 hours (time just for prepping and paperwork). Last year there was no waiting list, prices dropped below MSRP, and time spent on lots was creeping up to a week or more (anything under 10 days is considered a hot selling item, contrast that to nearly 6 months of the GMC Yukon and 4 months for the Suburban despite steep discounts).

The question is - is it because of batteries or the assembly line? Will it be solved when Toyota converts their Mississippi plant to build the Prius, or is there a raw material shortage?

 

There is no waiting list in California anymore. There was zero or 1-2 Prius in Toyota dealers lots couple months ago, but now they have 10 or more in inventory.

Inventory Search

The gas price has drop more than $1 down to $3.49, people start rethinking the payoff time of hybrid. When at $4.69 a gallon in CA, it is a no brainer.

 

If consumers bought 8.9% fewer hybrids last month, but the overall auto market was down 26%, then by comparison, hybrids ARE STILL selling much better than the average automobile.

Additionally, consumers sure as heck didn't exactly start trading in their hybrids for full-size SUVs!

I'm sure glad I don't own a Chevy dealer!

 

I would say (in California) the following play a part

1) Financial Market turmoil. Some can't get a loan due to tightening of belts at the financial institutions (making damn sure these people can pay them back). Some can't use home equity to purchase a vehicle because their home value has decreased significantly.

2) Economy (tied in with #1). Some are tightening belts or waiting until the economy and the markets stabilize, just so they can see where they are at.

3) Lower fuel prices. This takes away some of the "urgency" to buy a hybrid. People are relieved that gas prices are dropping and may not follow through with plans on changing vehicles. I know of at least 2 people who were interested in pursuing a hybrid purchase. One is going to stick it out with his car, the other, I've not heard a peep about it again.

For myself, I was planning on getting one in the Spring/Summer of next year. I'm curious to see what the economy and financial crisis are going to do to demand and interest rates. With a flood of new hybrids coming in next model year, interest rates likely staying low, potential for a recession (US and/or global), and people licking their financial market wounds, next year may be a good time to buy. Or at least I'm trying to convince myself of this....

 

New article on this from autoweek (might warrant it's own thread?):

Prius sales are off slightly through October -- 89,672 sold this year, compared with 90,891 last year. But the Prius makes up a whopping 42.5 percent of the total number of hybrids sold so far, 211,134. Toyota dealers need just six days to sell a Prius, and the transaction price is up from $25,033 last year to $26,098 this year, according to Power.​

So that is a slight increase in time spent on dealers' lots ("days to turn", they call it). Oct 2006 it was as high as 17 days, last year it was about 10 days. Ah, found the mother lode of days-to-turn stats: 11 days in May, 4 days in June, 5 days in July, 6 days in August, Sept #'s aren't out yet? Anything under ten generally means all vehicles are sold before it gets to the dealer (waiting lists).

 

What about the sale of hybrids normalized to all auto sales? I think since all auto sales are down it makes sense that sales of hybrids would be down. I'd be surprised if they were down more than any other segment though.

I'll say that personally I don't think it's as much of a supply problem as it is a demand problem due to the economy. I walked into the fleet department on 9/19 and walked out with a Prius - color and package I wanted - the next day. Actually, it came in that night and I could have closed then. Based on my limited experience the supply is there, people are just afraid to buy right now (and maybe rightfully so) and are having more trouble financing I imagine!

I wanted to buy a Prius several months ago, but balked at paying 3k over sticker and vowed I would wait until the '09 models came out. Guess that was a good plan If you're on the fence and wait for the economy to improve and gas prices to go back up you'll be paying 3k over sticker. If you have the money, now is the time.

 

I would agree that in the current financial climate many potential hybrid
buyers are holding back. I would suspect that this tendency spreads across
virtually all segments of retail sales as well. Holiday sales will probably be
dismal.

The PHEV is getting a lot of play right now, as are EVs, and hybrids by other
makers There is a strong possibility that some folks are waiting for these
new technologies to come on the market.

The current economic chaos aside, there were sales drops in Oct. in all four
preceding years. So, there should be no great surprise it happened this year
as well. What will be telling is whether the figures rise at year's end and in
the early new year as happened in three of the four previous years.

The graphs suggest that 2007 was a strange, non-typical year -- I don't
remember what was happening, but clearly it had a strong effect on hybrid
sales -- why the big drop in April, and the uncharacteristic big jumps in Nov.
and Dec?. Comparing 2008 -- which itself was twisted all out of shape by the
gas prices, and will be by the credit debacle -- to 2007 is probably sketchy at
best.

 

If they are truly selling every hybrid they have, then the data are meaningless. Demand exceeds supply. The real question: is production reduced?

Hybrids are not advertised by car dealers--they don't have any and they have huge inventories of ICE cars they must sell. You do see some used hybrids offered at inflated prices. If you want a new hybrid, you go to a dealer, order one and get on a waiting list.

 

From the where the rubber meets the road department

Toyota Offers 0% Financing On 11 Vehicles for October

Toyota announces zero-percent financing

Toyota Offers 0% on certain models (Camry, Matrix, Corolla etc.)

"The deal covers most of the Toyota brand except hybrids and the Yaris"

 

Demand in 2006 & 2007 was skewed by the tax credit. Some demand was shifted from later months to earlier months to take advantage of larger credits. The credit itself created some demand as well.

April 2007 was the first month without a credit.

 

I'm pretty sure the full rebate was reduced and finally ended Sept 30, 2007. But I never considered the tax rebate much of an incentive since the local dealer markup was always identical to the tax rebate ... funny how that worked out.

Bob Wilson

 

lets face it. high gas prices along with associated increases in food that has to be transported has pretty much removed any extra money many people have to spend and that includes new car purchases.

i work at a company that is large (over 150,000 employees world wide) including the 2nd largest private employer in the county and i see SEVERAL people who are opting for used cars simply because

1) cant justify new car payments

2) can not get a loan for a new car

i have one lady i work with, family income over $75,000...has $250 student loan payment, car payment of $325 almost finished, renting a house, two children both in school, and can not borrow the money to buy a car. now i dont know that much about her specific credit ratings, but i can say that last summer (2007), she had the chance to buy a car and had 3 different financing offers, but hubby talked her out of it. now her car is about to die (or undergo about $4000 in repairs) and hubby has changed mind so back in the market, wants a Prius (we now have 3 Pri's and 2 insights plus my EV in the lot) but cant get the loan now.

*edit*
as far as "lot time" goes. that time is started the minute the vehicle hits the US...depending on the dealer location, it could be as much as 10 days before the dealer even gets the car...so the "average" means very little. for the midwest, average time is probably 10-14 days with the car spending as little as 2 days on the lot for final prep before pickup... on the west coast near the ports like Socal or SeaTac Wa, its one day in port, one day to transport, 1-3 days for final dealer prep and gone...

realistically, around here, there is no "time on the lot"...all Pri's are spoken for months in advance. not up on the waiting list time, but i do know my local dealer does not have any gathering dust on the lot. was there to get oil change and they did mention that there is a waiting list still

 

Along with apparently most others, I didn't read the full article before now. This part would shed some light on the subject

​

 

I'm impressed that they've dialed in their production of multiple major components so tightly that they are reaching a systemwide bottleneck on the Prius, with no room for more. I'm accustomed to having room to tweak 10% additional here, then 20% (net) there with increasing investment before starting to hit the wall like this. Toyota makes it sound like the next increment is a complete facility.

 

That's because you can't find them anywhere and if you do find a hybrid that you may actually want to buy (Prius or Civic) they are marked up 4k above MSRP. I suppose at some point it just doesn't become worth buying one for most people.

 

It's 1 am, I'll chime in, I'm bored...

Some thoughts on potential factors (with limited facts to support them). :fish2:

Availability of used Prii is naturally higher than it has ever been, especially of Gen 2 cars, which could affect new car sales.

No more California carpool stickers on new Prii (see above reference increased appeal of used cars). Trust me, this is a big deal here in California.

No more tax credits.

Gas prices are down.

The most uncomfortable seat and driving position I, and some others, have ever experienced (which doesn't help word-of-mouth sales).

Like many "niche" cars, there are those who bought one for the novelty and have now gone back to the mainstream, and with them, repeat and referal sales. They were dissatisfied with handling, ride, comfort, noise, and many of the other factors that those committed to the cause are willing to endure. The Prius has also lost much of its "celebrity" status, they don't seem to be associated with the Leonardo DiCaprios the way they once were. The "coolness factor" is way down.

I think sales will continue to drop, mostly as a result of the previous paragraph. Folks are willing to pay more money, and are selfishly less concerned about the environment than they are about their own comfort and convenience.

Just some thoughts...

 

limited facts indeed

Very limited facts indeed. It seems like you've just made a bunch of unsubstantiated assertions and mixed in some of your random criticisms.

How many people who bought them for "novelty" have gone back into the "mainstream" and how many referral sales have gone away? At ConsumerReports.org - Best and worst in new car owner satisfaction: Car owner, auto shopping, the Prius was THE top car for owner satisfaction 4 years in a row.

You really think that there's significant percentage that are dissatisfied w/the attributes you cite to go back to the "mainstream"? Sheesh....

Let's see, the economy's crap w/credit crisis, tight lending, rising unemployment and the w/760K jobs lost in the US so far this year and Prius sales in the US are down 4.8% YTD (Toyota Reports September Sales | Reuters) vs. down 10.4% YTD for Toyota + Lexus.

In comparison, GM's YTD light vehicle sales are down 17.8% per http://media.corporate-ir.net/media_files/irol/84/84530/sales_production/Deliveries_September_08.pdf and total vehicle sales are down 18.1%.

Oh yeah, and last month, all automakers were down in the US per By the Numbers - September 2008: Nobody Wins Edition - Autoblog.

 

Re: more reinforcement for the Prius owner stereotype

No, I have not.

As I originally posted, they were some "thoughts", admittedly and as originally stated, based on limited facts and personal experiences and interactions. I made no "assertions" nor represented anything as factual. I offered personal opinions, which I am permitted to do, and without your approval. I even included the "fishing" icon for folks like you, who appear to have difficulty with the written word. To no avail, it appears.

Your lack of reading comprehension and social skills seem to be the only questionable issues here. I'm not submitting a thesis, I'm speculating about a trend on an internet forum. Back off.