September 2008 Dashboard: Recession Catches Up with Hybrids

in partnership with Polk

Hybrids Worldwide

"Top 5 global hybrid markets" based on vehicle registrations CYTD June 2008.

and "Top 5 US hybrid markets" based on vehicle registrations CYTD July 2008.

In September, auto sales continued their grim downward trend. Overall, the car market shrank by 27 percent relative to last year. Hybrids fared better, falling just 9 percent from September 2007 levels, but the message was clear—tight credit, reluctant consumers, and an economy plunging into recession have begun to affect all types of vehicles, hybrids included. Our question—from January of this year—if hybrids are “recession proof” is now answered.

Demand remained strong last month for the Toyota Prius, but demand slowed for many models, leading nearly every hybrid nameplate to show a sales decline. The shortage of popular Toyota models, coupled with slow sales for other hybrids, means that this year’s total hybrid sales for 2008 are likely to remain flat or even slightly fall below last year’s levels.

Another bad sign for hybrids is falling oil prices. In September, crude fell far below the $145 per barrel peak reached this past July. Gas prices are already trending downward, averaging roughly $3.60 at the end of September, and falling another 15 cents per gallon in the first week of October. While cheaper gasoline is welcomed by most American drivers, the reality is that lower gas prices translate into less consumer interest in hybrid vehicles. If the economy worsens, we can expect to see further declines in the cost of crude, and continued moderation in gas prices.

There are many looming unanswered questions: What happened to the Prius waiting lists? What about all those people wanting a Ford Escape Hybrid but Ford couldn’t supply them because of battery shortages? Did folks on waiting lists back out?

And what does the recession mean for future hybrids? Will the 2010 Honda Insight—hitting showrooms at $19,000 in April—have trouble reaching 100,000 sales next year, as Honda is targeting? Will Toyota still continue to march toward 1 million global hybrid sales per year? And what does the recession mean for more expensive models including the Chevrolet Volt, expected in late 2010 at close to $40,000?

Despite the bad news in September, long-time hybrid stalwarts Toyota and Honda are unlikely to slow down hybrid plans. They operated hybrid programs for years before the rest of the market saw the writing on the wall—and before hybrid profits were attainable. Could the economic downturn be the respite needed by the hybrid leaders, and others, to catch up on supply of models (and essential battery production)? Let’s not forget that new stricter fuel economy and carbon standards in the US and Europe will put pressure on global automakers to introduce hybrid technology. In this respect, late 2008 and early 2009 could be a fallow period before another big growth spurt in the hybrid market.

US Sales

Our information is based on hybrid sales as reported by the manufacturers. For each model, this month’s sales are shown compared to sales in the previous month and at the same time last year. We also examine hybrid market share by model and manufacturer. The historical sales graph for top-selling hybrid models shows estimated 2008 volumes based on sales-to-date.

Hybrids sold in the U.S. (September 2008): 20,836

US hybrid sales for September 2008

Model Units vs. last month vs. September 2007 CYTD vs. CYTD 2007
Prius 10,873 -19.2% -13.0% 130,561 -4.8%
Camry 2,785 -19.4% -33.6% 37,235 -8.9%
Highlander 921 -24.9% 377.2% 16,572 3.0%
RX400h 744 -41.7% -24.0% 12,498 2.5%
LS600hL 47 -33.8% -76.0% 838 n/a
GS450h 29 -17.1% -59.7% 563 -57.9%
Civic 2,020 -34.9% -3.4% 27,597 14.5%
Accord 0 -100.0% -100.0% 196 -93.0%
Escape 889 -23.0% -34.1% 13,183 -16.2%
Mariner 101 -44.8% -66.8% 1,832 -34.6%
Yukon 374 40.1% n/a 1,626 n/a
Malibu 382 -1.5% n/a 1,414 n/a
Vue 443 6.2% 768.6% 2,047 -4.6%
Tahoe 636 20.0% n/a 2,441 n/a
Aura 31 19.2% -50.8% 185 -70.8%
Altima 470 6.3% -37.8% 7,202 35.7%
Escalade 91 n/a n/a 92 n/a
All hybrids 20,836 -20.0% -9.4% 254,633 -2.7%
All vehicles 965,160 -22.8% -26.6% 10,765,263 -12.8%

U.S. hybrid sales for September 2008 by manufacturer and model

United States Sales by Make

U.S. hybrid market historical sales (1999 – 2007 with 2008 forecast)

United States Yearly Sales

Regional Data

Source: R. L. Polk & Co.

Curious where hybrid buyers live? We present the data in two ways. First, we list the 15 cities and states that boast the largest numbers of new hybrids on their roads within the past year. For example, residents in the New York City area put over 19,000 new hybrids on the road in 2007. Second, we adjust for population and look at hybrids per person (in states) or per household (in metro areas.) This lets us include cities like Portland, OR: a city that has fewer overall vehicles (and thus fewer hybrids) but has more hybrids per capita than anywhere else.

States with the Highest Hybrid Sales

Rank State New Hybrids*
1 California 53,301
2 New York 11,970
3 Texas 11,177
4 Florida 11,165
5 Illinois 8,280
6 Washington 7,146
7 Virginia 7,103
8 Pennsylvania 6,690
9 Arizona 6,427
10 Massachusetts 6,091
11 New Jersey 6,072
12 Maryland 5,175
13 North Carolina 5,026
14 Ohio 4,941
15 Oregon 4,257

*Registrations CYTD July 2008

States where hybrids are most popular

Rank State New Hybrids per 1000 Residents*
1 California 1.475
2 District of Columbia 1.417
3 Oregon 1.169
4 Washington 1.136
5 Arizona 1.082
6 Vermont 1.074
7 Connecticut 1.055
8 New Hampshire 0.967
9 Massachusetts 0.952
10 Virginia 0.939
11 Maryland 0.924
12 Colorado 0.912
13 Nevada 0.886
14 Hawaii 0.834
15 New Mexico 0.755
US State Average 0.669

*Registrations CYTD July 2008

Metropolitan areas with the highest hybrid sales

Rank Metropolitan Area New Hybrids*
1 Los Angeles 23,922
2 San Francisco 14,724
3 New York 14,115
4 Washington, DC 7,417
5 Chicago 6,635
6 Boston 6,243
7 Seattle 5,891
8 Phoenix 5,522
9 Philadelphia 5,310
10 Sacramento 4,746
11 San Diego 4,712
12 Denver 3,748
13 Portland, OR 3,596
14 Dallas-Ft. Worth 3,477
15 Minneapolis-St. Paul 3,321

*Registrations CYTD July 2008

Metropolitan areas where hybrids are most popular

Rank Metropolitan Area New Hybrids per 1000 Households*
1 Portland, OR 8.834
2 San Francisco 6.250
3 Monterrey, CA 5.012
4 Santa Barbara, CA 4.962
5 San Diego 4.592
6 Los Angeles 4.321
7 Charlottesville, VA 3.556
8 Sacramento, CA 3.526
9 Seattle 3.461
10 Palm Springs, CA 3.335
11 Phoenix 3.326
12 Washington, DC 3.293
13 Helena, MT 3.138
14 Eureka, CA 2.880
15 Eugene, OR 2.857
  US Metro Area Average 1.488

*Registrations CYTD July 2008

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  • hybridman2

    I don’t know if this is more a reflection on current Hybrid prices or more a reflection on peoples budgets tightening up due to the current recession.

    When people tighten their wallets the big ticket items are put on the back burner until they are more confident that they can afford to take on a 60 month financing debt. The added $3000-$4000 of a Hybrid adds a substantial amount to an already tight budget.

    If you knew you may be out of work in 3 months – would you commit to a $500 or $600 a month car payment or would you just bite the bullet and figure you’ll have to bend over and take it from the oil companies and OPEC?

    By the way people, get ready for gas to go up again. It seems our good friends in the Middle East are not happy that we’ve reduced our gas consumption, so they’re holding an emergency meeting to determine if they should cut back supply… friggin’ thieves.

  • Bryce

    Actually, Nissan and GM’s offerings did really well this month. GM’s market share has actually expanded to match Honda’s. (its growth rate for some of its vehicles are in the triple digits.) I guess the ramp up is going strong. Props to Nissan for posting gains as well, though sadly it seems they are stil below last years levels. Hopefully things will pan out for them. (and maybe they can finally offer the things in all 50 states) It is funny to see the Tahoe hybrids selling so well when only a few months ago, selling a dozen was a good month. Then again availability was low, and I suppose the word has gotten out on the vehicles. I am looking forward to later this year when the hybrid Silverados, Siennas, and Vue 2-modes hit the market. Should be fun to watch.

  • Need2Change

    Not sure why Prius had such a large drop. I thought there was a waiting list 6 months long for Priuses. Is Toyota holding them back to prop up prices?

    As for the Escalade, with most Escalades costing around $70K, I think that every Escalade sale should be a hybrid. What’s another $5K or so?

    Hybrids may not be recession proof. Sales will go down if people are losing their jobs or can’t get credit. But they appear to be recession resistant.

  • summer

    i still don’t believe in the charts, now which one is really true? i also thought that there is a waiting list to those who want to buy the prius? then how come the sales in the prius has been dropped?