An Aug. 23 article on the popularity of Toyota's Prius gas-electric hybrid misstated the federal government's tax policy on the purchase of hybrid vehicles. Buyers are allowed a tax deduction, not a tax credit. (Published 8/25/04)
The Toyota Prius, a gas-electric hybrid, is so popular there's a six-to-eight-month waiting list to get one at Koons Tysons Toyota. Across the street at Rosenthal Honda, the rival Honda Civic Hybrid is in ready supply -- 11 cars sat in the sun on a recent morning.
The Prius and Civic have similar new technologies, so it's not just fuel efficiency that's causing drivers to flock to Toyota's hybrid. "The Prius is a fashion statement," said Art Spinella, a consultant with CNW Marketing Research who surveys car-buying trends. "It looks different. Other people know the driver is driving a hybrid vehicle. It clearly makes a bigger statement about the person than does the Civic, which basically looks like a Civic."
The Prius has set itself apart with a geek-chic look -- a thick, curved body, a high back end and glittering computer displays on the dashboard. It's the car of choice for image-conscious Hollywood celebrities -- Larry David, Leonardo DiCaprio and Cameron Diaz are among the faithful -- and the favorite ride of the Sierra Club with its EPA-rated 60 miles per gallon in city driving. Google Inc. founders Sergey Brin and Larry Page have burnished their hip anti-tycoon images by both driving Priuses.
The auto industry is scrambling to milk the trend by making more hybrids, with Ford Motor Co. debuting the first U.S.-produced version and Honda Motor Co. and Toyota Motor Corp. expanding their offerings. But the Prius's trouncing of the Civic calls into question the depth of the hybrid phenomenon, suggesting that what seems like a new consumer appetite for clean technology could be more a hunger for one cool car.
"The basic reason I liked the Prius above the Honda is I just thought it was a much cooler-looking car," said Jeff Kash, 47, a West Hills, Calif., middle-school teacher who created a Web site to celebrate his 2004 Prius. "The Honda Civic Hybrid is a nice car, but it's boring."
Hybrid buyers in focus groups gravitate to the Prius "because of its unique design and will candidly admit they expect to receive some acclaim from friends, relatives, co-workers for their concern about the environment and/or fuel efficiency," Spinella said.
That's classic car-buying behavior, said Michael Marsden, dean of academic affairs at St. Norbert College in Wisconsin and an expert on popular culture. "Automobile culture has always been about status. The whole industry is based on symbols," he said. "With the Prius, you're bringing attention to yourself . . . saying, 'I bought something upscale, something people will talk about.' It is a conversation piece, an attention-getter."
And it's getting a lot of attention from consumers. Last month, a record 5,230 Priuses sold in the United States, and the car is on track to sell some 45,000 this year. Toyota recently announced plans to increase production to help alleviate a backlog. The company believes it could sell twice as many if only enough were available, Toyota Motor Sales USA Inc. spokesman Irv Miller said.
Those sales are helped by laws that encourage hybrid use. Virginia has made itself the second-largest hybrid market in the country, after California, by offering the cars a free pass onto high-occupancy-vehicle (HOV) lanes. The federal government lets hybrid owners take a one-time tax credit.
But those factors influence Honda sales, as well, and they're lagging far behind the Prius even though the Civic Hybrid has won high marks for performance. Car and Driver magazine recently rated it above the Prius in a driving test, though its gas mileage is lower than Prius' at an EPA-tested 48 miles per gallon in the city.
Honda sold only 1,963 Civic Hybrids in the United States last month, down from a peak of 3,183 in May. It expects to sell up to 24,000 here this year, spokesman Chuck Schifsky said, adding that production seems to be keeping pace with demand.
Honda also makes the Insight hybrid, a two-seater that debuted in 1999 as the first gas-electric hybrid for sale in the United States. That car's sales are evaporating, though, as consumers move away from two-door cars -- only 34 sold in the United States in July, down from 61 the month before.
But raw sales numbers don't tell the full tale of how much more heat surrounds the Prius than its rival. The Prius has been the fastest-selling car in the country for 10 straight months, meaning it spends the least time on the car lot of any vehicle before being sold, according to the Power Information Network. The Honda Civic Hybrid isn't in the top 10.
While dealers are offering discounts on the Civic Hybrid -- Brown's Arlington Honda advertises about $1,500 off retail of about $21,000, for instance -- the Prius sells for full price of roughly $22,000, no haggling. What's more, even a used Prius can command huge premiums at auctions such as the online eBay because new ones are so hard to come by.
Howard Weaver, inventory manager for Koons Tysons Toyota, said one of his used-car managers recently lost out on a used 2004 Prius on eBay to someone bidding over $34,000. A recent survey of the site showed several new Priuses in mid-auction with bids over $27,000.
Several Honda Civic Hybrids, on the other hand, were languishing far below asking price. A used 2003 with fewer than 5,000 miles had reached only $2,025 after 12 bids, for instance. A new 2004 Civic Hybrid with a starting bid of $20,356 had no takers after four days.
The lack of bids isn't necessarily a bad thing, said Michael Healy, who put that new hybrid up for auction as Internet sales manager for Jay Honda of Bedford, Ohio. "It generates a lot of interest and then people call you or e-mail you with questions," he said.
This is the first time he has tried auctioning a hybrid online, and he said he did so because the cars have sold well at the dealership. He credited the rival Prius with boosting overall interest in hybrids.
Honda says the Civic Hybrid was never intended to set hearts afire. "There are people certainly who want to stand out and want something different, and they have, I think, tended toward the Prius," Honda spokesman Schifsky said. "That is not exactly what the Civic is -- it just blends in. . . . People buy it because it's not different, because it is a Civic."
Even the type of hybrid drive used in the Honda was designed to seem unobtrusive. The car starts on gasoline power and uses the electric motor for an invisible boost during acceleration only. The Prius, on the other hand, starts out electric -- silent and smooth -- and switches on the gas engine automatically at speeds above 20 miles per hour.
That difference is another reason some people prefer the Prius, and it still comes back to image: "With the all-electric mode, there's just the coolness factor. You can drive off from where you're parked and everybody says, 'Whoooa, no noise!'," said Charlie Garlow, 55, a lawyer at the Environmental Protection Agency who drives a 2003 Prius and advocates electric power for vehicles. "The Toyota is a step in the right direction compared to the Honda Civic, which never lets you put a foot on the pedal unless you've got some gasoline burning."
Ford put a Prius-style drive system in its new hybrid, the Escape SUV, but otherwise followed Honda's low-key example. The Escape hybrid looks almost identical to its conventionally powered predecessor. That conservative approach could limit the Escape hybrid's appeal, because people who pay a few thousand dollars extra for the new technology want to show it off, said Sean McAlinden, chief economist at the Center for Automotive Research in Ann Arbor, Mich.
"Maybe Ford should make them all forest green and put this big 'hybrid' sign on them," he said.
For its part, Honda isn't worried about staying atop the trend. "We're going at it in a methodical way, which is very common of Honda," Schifsky said. "I think interest is going to continue. I'm not sure at what rate it is going to continue."
If fuel prices remain relatively low -- and by inflation-adjusted historical standards, even this year's spike to $2 a gallon was low -- interest in hybrids is unlikely to go beyond current levels, he said. But if prices zoom up toward $3 a gallon, he added, "boy, that hits people."
Toyota remains bullish that the Prius is more than the automotive equivalent of disco or pet rocks. The company has roughly 7,500 paid orders in hand for the Lexus RX 400h SUV hybrid, which debuts later this year, spokeswoman Martha Voss said. Some 50,000 people have expressed interest in the Toyota Highlander hybrid SUV, which debuts next year, she added.
"We do not believe that Prius is a flash in the pan -- hot today, gone tomorrow," she said in an e-mail. "Nor do we believe it will be the only successful hybrid. Our money and the money of several other manufacturers are betting on it."