Can US Automakers Catch Up to Prius?

As President Obama and other administration officials were yesterday announcing $2.4 billion in grants to produce the next generation of hybrid and electric cars in the US, Toyota was tallying record sales of today’s leading hybrid car, the Prius. The Toyota Prius ranked as Japan’s top-selling car in July, its third consecutive month in the top slot. In the US, July sales of the Prius jumped by nearly 50 percent from last month and were up 30 percent from a year ago.

The $2.4 billion in grants will support the deployment and trial of up to 6,873 plug-in hybrid or battery electric vehicles. It could take several months, or as long as a year, to deploy the trial vehicles. Meanwhile, Toyota sold 19,193 Priuses in the United States in July, plus an additional 5,122 hybrids from three other Toyota and Lexus hybrid models.

“I don’t want to have to import a hybrid car,” said President Obama at an appearance yesterday in Warakusa, Ind. “I want to build a hybrid car here.”

It’s About the Batteries

The majority of the $2.4 billion federal investment is supporting next-generation lithium batteries for advanced electric drive vehicles. “More research and more development of batteries is urgent and critical,” said Dan Sperling, director of the Institute of Transportation Studies at the University of California, Davis, in an interview with Christian Science Monitor. “Advanced batteries of different sizes and shapes will be in every car of the future.”

“We’re at the beginning of a very large opportunity,” Brian Wynne, president of the Electric Drive Transportation Association, told The New York Times. “There’s a choke point here. The choke point is the availability of automotive-grade batteries. That choke point is worldwide. That’s not a US phenomenon.”

In fact, Automotive News is reporting that Toyota cannot meet booming demand for the current generation of hybrid batteries—nickel metal hydride—because the company, and its battery partner Panasonic EV Energy, cannot produce hybrid batteries fast enough. Takahiko Ijichi, Toyota senior managing director, said, “Unfortunately, the batteries are not catching up with demand. Production of the batteries needs to be increased in order for our production to go up.” Ijichi added, “The new Prius model has been excessively popular.”

Toyota currently has annual Prius capacity of 500,000 cars. Panasonic EV Energy plans to boost capacity to around 1 million batteries by the summer of 2010, Ijichi said. In an interview with the Detroit Free Press yesterday, Jim Lentz, president of Toyota Motor Sales, said, “My vision is to have a family of Prius vehicles.”

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  • Charles

    The headline is also off a bit. “Can Any Automaker Catch Up to Prius?”, would be more accurate.

    In reading about future cars, I do not see a Prius killer. Ford has done a great job competing with the Highlander and Camry hybrids, but has nothing to go head to head with the Prius. Honda’s Insight, is not competitive on MPGs, or size, just price. Nobody else is even in the park, and that is even if the park is Yellowstone National Park.

    Hopefully some manufacture (Ford or Mazda come to mind) will offer a Mazda5 like hybrid. That would be a new market. If you exclude the MPG’s of the Prius, what car sold in the USA would it compete with? The Prius has almost midsize sedan room, and large hatchback versatility. I cannot think of any car that matches the Prius’s feature set.

  • Dave78752

    I think a big reason why there is no direct competitor to the Prius is that as you mentioned it’s a very uniquely sized/equipped car that in order to compete with it you’d have to build something that looked very similar and then there’s no way to have an advantage.

    The Prius really is in a category it created, the Insight is the closest thing to a competitor but it was so poorly conceived that it’s not competition. If any other automaker tried to compete directly they would end up with something like looked the same and would be called a knockoff.

    I think the trick is to do what Toyota did to another segment, create a new hybrid vehicle in a class of its own.

    Again this is nearly impossible because the Prius was designed to be as aerodynamic and efficient as possible, so it’s unlikely another design would compete with MPGs which is how hybrids are currently judged.

    I think a hybrid station wagon or minivan is the logical next step. If ford would bring back the windstar as a hybrid with city mileage in the 30’s I think that could be a success or a smaller version of the ford edge as a hybrid. Same for the other guys. Interestingly I think that Toyota should have made the Venza hybrid only, that would have been really popular.

    All the automakers can be competitive with hybrid versions of their current cars, and this will be similar to the camry hybrid vs fusion hybrid and the escape hybrid vs highlander hybrid but sales of these non-unique body types will always be a lot lower than hybrid only designs.

  • Charles

    A reply to myself may show signs of insanity, but I thought of the closest competitor to the Prius for size and versatility: VW Jetta Sports Wagon. Almost the same passenger volume, and even more cargo space. The fun to drive factor goes to the VW.

  • J-Bob

    Ultimately if this can get the costs down as far as Lithium tech goes, I’m all for it. Got a 72V 30ah pack for my e-bike and that cost me a small fortune, but it sure is nice having a bike that can go 40mph!

  • Samie

    When you offer the best hybrid you tend to get the most sells. Why is this surprising? Also why do some discount other manufactures who are wanting to skip full hybrids & offer serial hybrids or EV’s? Even Toyota could fall behind if they don’t work on moving a Prius model to a EV or serial type in the near future.

    There are lots of mysteries when it comes to hybrids or strategies for car companies but this is what I see, is that until recently little movement in CAFE regulations helped create two types of brands, one American brand w/c was roomy, poor quality, big or inefficient engines & the Foreign concept of smaller, higher quality cars that tended to run a bit more efficient w/ less power (even though you can not say this has been 100 percent of the case) But the argument here is that higher CAFE standards mean domestics can not enjoy the old way of thinking & they have to compete head to head against the likes of Toyota. So as mpg standards get higher you will see more & more competition against Toyota’s Prius. Remember also that car models take many years to develop from concept to production so the things I & others complain about may be just a year or two away from real production.

  • Tom Me

    Is catch-up really the game here? Define the goal. Is it to take market share away from the Prius? Is it to get people into more fuel-efficient cars? Is it to make money through the sale of greener cars? Those are 3 different goals.

    Business 101 is to not compete directly unless one has to. Case in point.. insight vs prius. Insight vs first gen prius makes the insight look quite good. But, they are building a new car to compete with the third gen prius. And, given some time, I believe the insight will improve considerably.

    A different tact is to respect the Prius, but offer EVs, hybrid SUVs, hybrid utility trucks, etc. That avoids the head to head, gives everyone greener options for transportation, and lets the car companies make money via selling the autos.

  • sean t

    US car makers used to lead the industry, now are playing the catch up game. What irony!
    I think the sub-title “It’s About the Batteries” says it all. Whoever makes a breakthru in Battery Technology will win.

    Re cath up game, Bob Lutz still believes that GM should make more gas-guzzlers:
    “. . .
    General Motors Vice Chairman Bob Lutz said in a newspaper interview published on Thursday that US consumers still wanted to buy big “gas-guzzler” cars and suggested that GM had to respond to that demand.

    Lutz told the Swiss newspaper Tages-Anzeiger that the ailing US auto giant had decided this week to ramp up production of big pick-up trucks and sports utility vehicles in the United States because stocks had nearly run bare.

    “It remains a fact that the American public buys big, high-consumption cars,” he said.

    “It is completely wrong to hope that Americans will massively rush to economical vehicles.

    “The mass movement towards ‘green cars’ is only taking place in the media,” he added, pointing to “poor” sales of hybrid vehicles, other than the one offered by Japanese rival Toyota, and their small share of market.

    GM’s challenge was to “meet the tougher emissions standards by 2015 and deliver the whole range of cars that the public wants,” Lutz cautioned

    Wonder why GM still employs Bob . . . How can you cath them up?

  • Sullivas6

    As a Prius owner, yes they can. The Prius is not distinctive, it looks more or less like a bump in the road. It’s selling points are gas mileage, quietness and roominess in the back (you can fit 4 large people 300+ into a Prius). Build a car they competes on this level and it will sell.

    The problem is not how good the car is but the fact that American auto makers are behind in technology and production capabilities to compete. As soon as they catch up over the next 3 years, you will see a high selling US hybrid.

  • Nelson Lu

    I think that GM has a potential Prius-killer (*if* it does everything that they promise — and that’s a very big if) in the Chevrolet Volt.

  • Bryce

    The Prius is in such an odd segment that it may not ultimately need to be competed with. If normal cars were introduced with hybrid or electric drivetrains (or even extremely fuel efficient gas and diesel engines) then the novelty of the science project car segment would wear off in favor of practical and fun traditional coupes, sedans, and pickups. Once they achieve comparable fuel economy, then there would be no point in having a Prius to the consumer because its one advantage of extreme fuel economy would have been degraded.

    just my 2 cents.

    As for the claims that the Volt will compete with the Prius, I would say that they are in fact not competitors. Its closest competitors would be things like the Ford Focus EV and the Nissan Leaf Project. Maybe the plug-in toyota prius if they can get it beyond 10 miles of range as they are saying. (which sucks)

  • TD

    I don’t think the Volt is serious competition at $40K ($40K even after the $7500 tax credit). All those people who poo-poo hybrids saying it will take forever to make up the $5K extra cost from gas savings in a hybrid have to ask the same question of the Volt. How long will it take to make up the $15K to $20K over a conventional hybrid let alone a conventional car?

    I think Lutz’s comments shows GM’s true stripes. They are creating the Volt to say ‘see we are creating a green car too’, but are setting it up for failure by offering it at that price. When it fails they can crow told you no one wants it. GM simply doesn’t believe that Americans will by more fuel efficient cars. Of course, if GM is right then they should be rushing to make hybrid SUV’s and mini-vans because they should sell like hot cakes. What’s an extra $3K to $5K on a $60K Escalade? Maybe the great success of the cash for clunkers program will change their mind.

    Lutz retires later this year and hopefully some newer blood will emerge in GM’s management, but I won’t hold my breath. Why did we bail out these morons?

  • mr. rap

    The prius was build from the ground up to be a hybrid. So U.S. automakers need to build a car that will be a hybrid from the start not just offer a gas and a hybrid version of the same vehicle.

  • sean t

    Yes, it’s a big IF. Hope they can do it, or is it just a conspiracy, considering what Bob Lutz said?

  • Nelson Lu

    Sean T:

    Lutz is simply a nutcase when he talks to the press. As has been noted, he won’t be on the job that much longer, it appears. GM has too much invested in the Volt to let it fail just to sell SUVs again, because they won’t sell the way they did any more.

    Why I consider the Volt a competitor to the Prius despite the purported price of $40K (and as far as what I heard, it is $40K *before* the $7.5K credit, which makes its price closer to the top-of-the-line Prius) is that it will beat the Prius in efficiency and range, if it delivers what it promises. Neither the Focus nor the Leaf will truly compete with the Prius since they won’t have its range. The Focus and the Leaf will be pretty much restricted to city driving completely (although I do think that both look promising); that’s not the case for the Prius, nor will it be the case for the Volt.

  • RKRB

    The VOlt a Prius competitor ????? Well …. given GM’s abysmal record of introducing new vehicles, or providing support for anything but old-tech cars and trucks, it is very unlikely the Volt will compete with the Prius (just as the X-car or Cobalt competed poorly with Toyota), sad to say.

    Toyota recognized the need for quality small cars and hybrids, built them, and capitalized on being in the right place at the right time. They are to be commended for this!

    If Obama wants to build a better hybrid than the Prius, then maybe he should build it himself.

  • Anonymous

    I hope US and all other car companies will somehow catch up, because we all know a little competition will help hybrids become more affordable and hopefully more people buying them.

    I’m especially eager to see if Honda will put the latest hybrid system into the Insight and still have it cheaper than Prius.

  • Dom

    Umm… last I heard the Prius isn’t exactly the worlds best selling car, nor even the most popular car in America. Why exactly do we need to play catch up to it? Oh, that’s right, if we don’t the media won’t think we’re green enough. Silly. Ya know it’s funny that the Prius isn’t a runaway success in Europe… maybe because they already have plenty of fuel-efficient cars that are better? So perhaps this elusive Prius killer is a European car… like Charles hinted at…

  • Max Reid

    Yes, atleast Ford can catch up.

    Escape Hybrid is #1 among CUV’s having overtaken Highlander Hybrid while Fusion Hybrid has overtaken Camry Hybrid for #1 slot among sedans.

    Ford can take one of their European hatchbacks apply a Hybrid system and sell it as an alternative to Prius.

  • bill cosworth

    This site is funded by Toyota lets be frank.

    All I can say is the 2010 toyota prissy will be short lived.

    Nissan has leaf
    GM has volt
    Ford has Focus EV
    Chrysler has EV
    Honda’s next version of insite

    The Toyota prissy will be forgotten and all the prissy fans will fall apart the main problem is 50 MPG

    All the new EV will be well over 200 MPG and with rang extenders whats the point of a prissy.

    Hybrids are just what they are hybrids. Pure electric is the future.

    Sorry to be evil about this site but hybrid TV sets when away too in 1970

    They were hybrid transistor and tube technology.

    Its just a way to move foward until you perfected the transistor.


  • Anonymous


    u sounded like a disgruntled GM autoworker that has been laid-off.

    Prius earned it’s reputation, get over it.

  • JMB

    Wow, calling the Prius a “prissy” is really logical and persuasive. Impressive.

    You ask “what’s the point” of owning a Prius when plug-in hybrids will offer a 200 mpg equivalent rating. Well, one obvious reason is that tens of millions of Americans can afford a $25,000 Prius, but not a $40,000-plus plug-in. (GM’s Chevy Volt will likely sell for more than $40-45,000 base, and Toyota’s plug-in version of the Prius will likely sell for $48,000.)