Hybrid sales slack despite gas spike

Using less fuel, tax credits not enough for many consumers, analysts say

DETROIT – U.S. gas prices have risen nearly a third over the past year without touching off a boom in sales of fuel-efficient hybrid vehicles, some of which are sitting on dealer lots for as long as three months.

Many U.S. consumers are concluding that what they save in gasoline and on tax credits from driving a hybrid does not justify the roughly $3,000 premium they face at the dealership, even with high and volatile fuel prices, analysts said.

That poses a problem for car makers including Honda Motor Co. Ltd., Ford Motor Co. and Toyota Motor Corp., that have bet on broadening popularity for hybrids, including more powerful six-cylinder models and sport utility vehicles.

“What it comes down to is whether you want to pay for that premium right up front… or pay for it incrementally in the form of a different vehicle that gets a slightly lower fuel economy,” CSM Worldwide analyst Mike Jackson said.

Reuters