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Appeal of hybrids goes beyond savings

HEATHROW — A year ago, the average price of a gallon of gasoline was $3.45. This week, it's about $2.70. Why would anyone, then, feel compelled to buy a hybrid?

Having a hybrid isn't just about saving money on fuel. The gas-sipping vehicles are good for the environment, fun to drive, maintain their value and can even be considered a "fashion accessory," owners and industry experts say. That's why sales of hybrids have held up well, even as gas prices have plunged and the automotive industry struggles through the recession.

Dr. Sultan Rahaman bought his first BMW in 1991 and has owned a succession of them since. But this year, he replaced his BMW with a 2010 Toyota Prius. And shortly before that, he replaced his wife's minivan with a 2009 Prius.

And though he does miss the BMWs, "I thought, how often do I really need 300 horsepower?"

Rahaman is averaging about 50 miles per gallon in his Prius. And in doing so, he feels he is making a difference.

"In the 1970s, during the first oil embargo, I was going to school in Canada, and I remember hearing about how we needed to reduce our dependence on oil," he said. "And for 35 years, we've basically done nothing. In a small way, I feel like we're doing something now."

Despite the dramatic downturn in U.S. auto sales, hybrid sales remain relatively strong. In September, sales of the Toyota Prius were down 3 percent, but that was the smallest drop of any Toyota passenger car. Honda, meanwhile, has sold about 16,000 Insights this year.

Ford's September hybrid sales of 12,186 is a 239 percent increase over a year ago, led by the first-year Fusion Hybrid.

Hybrid sales are estimated to grow to 4.1 percent of the total U.S. auto market this year, or about 329,000 vehicles, up from 2.6 percent in 2008, according to tracking firm IHS Global Insight of Lexington, Mass.

Resale value also is a plus: A 2004 Toyota Prius, according to Kelley Blue Book, is worth $15,460 at retail. A 2004 Toyota Camry SE, which would have cost about the same as the Prius new, is worth $12,230.

Though Toyota and Honda have led the hybrid revolution, other companies are fighting hard to catch up. Mazda has announced that it is trying to raise $1.1 billion in capital and will dedicate most of it toward hybrid technology. Ford and General Motors have made huge strides in hybrids, while Chrysler has co-developed some technology with General Motors.

European manufacturers have traditionally concentrated more on clean diesel, fuel cells and all-electric vehicles. But even that is changing. Porsche will have a hybrid version of its new Panamera sedan, and France is investing $2.2 billion to get 2 million hybrids and electric cars on the road by 2020.

Jesse Toprak, vice president of industry trends for TrueCar, a California-based automotive analyst firm, says there's also a star factor in owning a hybrid.

"Hybrids (are) a fashion accessory," he said. "It's appealing to be able to drive the same car that, say, Leonardo DiCaprio drives."

But that, says Rahaman, has nothing to do with his decision to own a hybrid.

"I just thought, 'This is a car I can live with.' I really can't remember being more excited about driving a car."

By the numbers

4.1 percent

estimated percentage of 2009 U.S. auto sales that are hybrids

2.6 percent

percentage of U.S. auto sales that were hybrids in 2008

$15,460

resale value of a 2004 Toyota Prius

$12,230

resale value of a 2004 Toyota Camry SE, which had about the same retail price as a Prius

By the numbers

4.1 percent

estimated percentage of 2009 U.S. auto sales that are hybrids

2.6 percent

percentage of U.S. auto sales that were hybrids in 2008

$15,460

resale value of a 2004 Toyota Prius

$12,230

resale value of a 2004 Camry, which had about the same retail price as a Prius

Appeal of hybrids goes beyond savings 11/03/09 [Last modified: Tuesday, November 3, 2009 7:23pm]
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