Hybrid Vehicles Fly Off Dealer Lots, Supply Challenges Mount

Demand for gas-electric hybrids has been surging overall as consumers increasingly opt for fuel-sipping cars to combat high gasoline prices. The Prius, the first mass-market hybrid and the most iconic hybrid name, is at the vanguard of the trend, with U.S. dealerships recently measuring their Prius inventories in hours, not days.

At the end of May, a new Prius averaged just under 17 hours on a dealership lot before being sold, compared with an average 3.5 days at the end of April. For comparison, Toyota’s average passenger car spends about 25 days at the dealership, according to the company.

“We’re just seeing (Prius) demand outpace our supply,” said Sona Iliffe-Moon, a Toyota spokesperson.

The heavy demand for the Prius provides one of the more dramatic examples of the effect that record-high gasoline prices are having on consumers, who have largely stopped purchasing large sport-utility vehicles and pickup trucks. It also illustrates the challenges that auto makers face as they try to adapt to a trend that has taken hold quickly and appears to be permanent.

Despite the increased demand for hybrid vehicles from Toyota and other manufacturers, production is running at full-tilt in most cases and can’t easily be increased, because of limited supply of specialized powertrains and other components that go into them.

CNN Money