Newsletter Archive Index

~~~ Hybrid Cars Newsletter: Issue No. 0022 ~~~
Moderator: Bradley Berman [[email protected]]

Greetings, Hybrid Car Enthusiasts,
2005 has come and gone, with a number of news agencies looking back and labeling 2005 as "the year of the hybrid." The number of hybrids on the market jumped from four to 10, and hybrid sales in the United States broke the 200,000 mark for the first time. Certainly, nobody could have predicted last year’s roller coaster of gas prices, which made U.S. consumers pay attention to fuel efficiency after decades of disregard. In response, nearly every major car company either jumped on the hybrid bandwagon or announced a rapid acceleration of their existing hybrid programs.

With two award-winning, 50-plus mpg sedans to choose from, American consumers have excellent alternatives to consider. In this newsletter, we’ll help you understand the pros and cons between the Honda Civic Hybrid and the Toyota Prius. We’ll examine how improvements in hybrid battery technology could make 50 mpg look like child’s play. And we’ll consider where gas prices might go in 2006, how air conditioning affects your mileage, and why getting a so-called "return on investment" is irrelevant to most hybrid buyers.

We are pleased to announce that has a new content partner: BusinessWeek Online. Our original stories, interviews, and online tools will be featured on BusinessWeek’s new autos channel. Stay tuned for more details about this, and announcements about other exciting content partnerships.

Available Hybrids

The list of available hybrids continues to hold steady at 10 models. As we step into 2006, there are 13 hybrid plants worldwide, with Toyota and Nissan each spending approximately $10 million to add another plant. Hybrid versions of the Nissan Altima, Toyota Camry, Lexus GS sport sedan, and Saturn VUE are all set to launch in 2006. At the moment, no expected debuts for a hybrid minivan or a convertible hybrid. (Two or three readers always ask.)
See our list of available hybrids:

Price Pulse
If you are in the middle of your hybrid shopping experience, you should check out our Price Pulse to see what fellow shoppers are experiencing in terms of price, required deposits, and waiting lists. And while you’re there, let others know about your wheeling and dealing.

New Tax Incentives Take Effect
Enhanced federal hybrid tax incentives, as part of the 2005 Energy Bill, are now in effect. The credits were designed to reduce the cost of the most efficient hybrids by thousands of dollars. But that might not be true for everyone. Get the details about the credits—and the effects of the Alternative Minimum Tax, which might wipe out your credit.


Great reviews for the redesigned 2006 Honda Civic Hybrid have created a dilemma for hybrid shoppers: Civic or Prius? A few days before Christmas, a site visitor named Seth reached out to the community to get feedback on his decision process. He wrote, "For years now I have had a raging case of Prius envy. And now, just as I am ready to hop on to the waiting list at my local dealer, this ’06 HCH comes out. What am I to do?" Seth provided his list of the pros and cons of each vehicle, which stacked up almost evenly. "I had a hard enough time getting over the fact that I have to give up my classic 1990 BMW convertible for the sake of saving the planet from my idiot SUV driving neighbors. Now I have to make this decision too?"

The level of thought and consideration reflected in the thread was impressive. In two of the most critical categories—mileage and performance—the discussion participants gave an ever-so-slight edge to the Prius. But these factors, as well as price, weren’t enough to push most shoppers one way or the other. So what were the determining factors? Check out these excerpted quotes from folks actively shopping and test-driving both cars:

Exterior Design
I am leaning towards the Prius because of the ‘statement factor’ that it makes as I cruise past all the huge SUVs and Hummers driving around town.
Pro-Civic: The HCH is nicer, simpler, and will hold the test of time better than the too techno-weenie-ish design of the Prius. The Prius to me screams, ‘I bought a hybrid vehicle and I want everyone to know about it.’

The Prius drove and felt more like a totally new kind of vehicle.
Pro-Civic: The Civic handled a bit tighter and felt a bit sportier.

The Prius is available with all of the airbags that the Civic is available with, plus it can be had with stability control, which has been shown in multiple studies to reduce accident rates.
Pro-Civic: I really like the safety features of the HCH. It has turn signals on the mirrors, six standard air bags, and daytime running lights. As a result the Civic recently received the gold award from the National Insurance Institute for Highway Safety.

The one thing that really convinced me was the blind spot; in the Prius, it is huge. People focus (even myself) sometimes too much on the fancy safety features like ESC (anti-skid) when something simple like limited visibility can cause just as many or more near-miss situations.
Pro-Prius: There is a bar separating the rear window into two panes, but the bar isn’t large enough to hide a car. It is different and does require getting used to, but if there’s a car behind you, you’ll see it.

Interior Space/Styling
After test driving/fitting a Prius two days ago, the Prius wins hands down. A full-size cello case fits in the back of the Prius (a firm requirement for us) with room left over for book bags, and I can still carry five passengers. The Prius has a 60/40 fold down rear seat, providing a ton of cargo hauling space. The Civic’s rear seat does not fold down at all.
Pro-Civic: The one thing that has me leaning toward the Civic, however, is that I love the interior of the new ’06 and really don’t like the interior of the Prius. The Honda’s interior just feels more plush. I loved the layout and look of the dash and other controls.

The Civic is in its first year after redesign, which means it is more likely than the Prius to have problems. The Civic’s IMA system is improved a lot, but it still is not up there with Prius’s Hybrid Synergy Drive. The Civic uses a 20 horsepower electric motor instead of 67 horsepower on the Prius.

Color Choices
I like the Prius’s (choices of) red, blue, black, and the new pine is cool too (if a little girly).
Anti-Civic: The colors are another problem I had with the Civic. Options are white, grey, grey, grey, grey and grey. The Prius has actual colors.

Many times I have thought about how easy it would be to get a Civic Hybrid without having to worry about the right package. However, the packages of the Prius have the "cool" factor, with the Smart Key System, backup camera, Bluetooth connectivity, etc. I absolutely love the idea of never having to reach for my keys.
Pro-Civic: ‘Key fob??!!’ Uh, no, I don’t think so. I will start my car with a key, thank you very much.

General Comments

  • If I could somehow combine all the features of the Prius that the Civic lacks (traction, stability, fold-down seats, lighted vanity mirrors, xenon headlamps, better acceleration) with those of the Civic that the Prius lacks (active head restraints, telescopic steering wheel, daytime-run lamps, signal mirrors, price, better handling) I’d have a damn good car.
  • To generalize sweepingly, people who like to blend in will like the Civic, and people who like to stand out will like the Prius. To each his own.
  • The HCH interior is fantastic and feels great inside and the Prius is bigger, faster, better mpg, better emissions and…well it’s a Prius.
  • Forget about Honda until their hybrids can drive solely on electric power at 15-20 mph and below. Prius is damn ugly but seems safe and kicks ass in every geeky way possible.

Participate in the discussion thread.

The emergence of small, lightweight, long-running lithium ion batteries created the market for computer notebooks, cell phones, and other personal portable electric devices. Scaling that technology up to car batteries could do for the automotive industry what the same battery technology did for computers and phones. The benefit for consumers could be revolutionary: hybrid or pure electric cars with great efficiency, acceleration and range—at the same price or cheaper than today’s conventional cars.

On Dec. 16, Toyota announced that they would accelerate development of lithium batteries for use in their hybrids. That’s a clear sign of how important lithium batteries may become for the auto industry. For Toyota to achieve its goals of selling one million hybrids globally per year and offering hybrid versions of all their popular vehicles, they’ll need to reduce the incremental cost of their hybrids. Earlier this year, Katsuaki Watanabe, Toyota’s president, articulated that goal as reducing "the cost difference of hybrids to one-half the current levels." According to Dave Hermance, executive engineer of environmental engineering at Toyota, batteries are the single most expensive element in the hybrid system. "To make a big leap forward with hybrids,” he said, “we’ll need a new battery technology." Our article explores the latest developments in the race for more powerful hybrid batteries:

  • Why we’ll see a lithium economy before we see a hydrogen economy
  • Which car companies are moving forward with lithium-based hybrid batteries
  • Which battery companies—large and small—are trying to turn base battery materials into gold
  • What is all means to the future of sustainable mobility.

Read the article.

Interview: Hybrid Cars as Symbols of Identity
Researchers from the University of California at Davis are speaking directly with hybrid owners to better understand hybrid car purchase decisions. Ken Kurani, Tom Turrentine, and Rusty Heffner of UC Davis’s Institute of Transportation Studies eschew traditional marketing techniques like focus groups, or surveys in which thousands of consumers tick a series of boxes and number-crunchers tally the results.

Instead, the UC researchers sit down over the kitchen table with the entire consumer household—commonly the car purchase is a family decision—for two hours or more, and let the stories come out. In this way, they believe they develop a deeper understanding of what’s motivating hybrid owners. They’ve interviewed more than 30 households who bought Priuses, Civics, and Insights—and now they are moving on to the latest wave of hybrids.

We spoke with Kurani and Heffner on Dec. 21, 2005. What is the primary goal of your research?

Rusty Heffner: We’re trying to understand what motivates people to buy a new kind of vehicle. As Americans, when you are buying a car, you have so many choices. You have over 300 combinations of make and model. Why does somebody consider a new technology like a hybrid?

Ken Kurani: We learned from our first sets of interviews to throw out our assumptions, to start from scratch rather than, in effect, go into an interview with a checklist of things to look for. To go into interviews with a wide-open mind, and let the stories tell us what was important about what people were doing. And then Rusty developed an analytical approach to deal with cars as symbols of identities. What do you mean by "symbols of identities?"

KK: In an increasingly market-based society, the things we buy are more and more a part of representations of who we are. And cars are incredibly important symbols of who we are, in large part, because cars are so mobile and so many people see them everyday.

Also, I think our identities are constructed as narratives. And we’re always looking for new elements for those narratives. We’re comparing the stories we have about ourselves today to older stories and to ideal stories. In those comparisons, we’re looking for either new ways to either advance the storyline we like, or change the one we don’t like. The idea of what a car means can be one of those important story elements. Journalists commonly criticize hybrid cars for not providing a return on investment for their owners. Based on your research, what’s your opinion of that criticism?

RH: I think the question journalists are asking is, ‘Do hybrids save money?" It’s the wrong question. A more basic question to ask is, "Do people who are buying hybrid cars really care about saving money?" The truth is that everybody likes to save money in the abstract. But we found in our research that saving money is not the primary motivator for buying a hybrid vehicle. Some people might think about hybrids as ways to save money. Those are not the types of people who are buying these types of vehicles.

KK: In the interviews, we heard that people who bought a hybrid compared it to nothing else. Once they heard about a Prius, for example, and heard about its capabilities, that became the car they needed next to advance a certain story line. At that point, keeping their old car was no longer desirable.

Read the entire interview.

The Year Ends with Studies about the Future bloggers kept tabs on end-of-year forecasts regarding gasoline prices and hybrid sales. All signs indicate that hybrid production will continue to grow, but not nearly as fast as growing global demand for petroleum.

From Auto economist Walter McManus:
In December, the Energy Information Administration (EIA) officially acknowledged the end of the era of cheap gas. They released projections that reveal dramatically higher world oil prices, with a new floor of $2 a gallon for gas. This is the first significant increase in EIA’s forecast of oil prices in years. It is time for our automakers to accept this reality—something foreign competitors have understood for years.

The EIA’s 2006 forecast also predicted that light vehicle fuel economy will improve over the next 25 years. The question is just how much improvement do they predict? A paltry 2 mpg for new vehicles and an even more paltry 1 mpg for all vehicles on the road—the equivalent of two and a half weeks of current fuel consumption in the United States.

Get the details, including the economic charts.

From Michael Millikin of Green Car Congress:
ExxonMobil, a very conservative company, has made a very radical forecast: by 2030, close to 30 percent of new car sales in the United States and Canada will be hybrids. This is a rate almost four times as large as that predicted by the EIA. The EIA forecast, in turn, is a more aggressive forecast than that of most automakers.

Hybrids currently constitute about 1 percent of new car sales in the United States.

As a corollary to that prediction, made in The Outlook for Energy—A View to 2030, ExxonMobil also foresees that North American fuel demand for light duty vehicles will likely decline by 2030 to the same level as in 2000 due to growth in the number of hybrids on the road and the use of other fuel-efficient transportation technologies.

So are hybrids coming to the rescue, helping us dodge the bullet of an impending energy crisis?

No. Even if oil demand drops in North America, global demand continues to rise—especially in the developing Asia-Pacific countries. ExxonMobil predicts a 60 percent increase in global energy demand between now and 2030.

Get the details.

Hybrids and International Politics
Peter Maass, writing in the New York Times Magazine, asked, "Countries with a lot of oil are lucky and rich, right?" Nope. In Maass’s Dec. 18 article, he cites economic studies that show how countries dependent on natural-resource exports experience low growth rates and suffer greater amounts of repression and conflict. This phenomenon is known as "the resource curse." He writes, "Domestic restrictions on drilling have had the unintended effect of insulating our tender consciences from the worst impacts of oil extraction…Perhaps a few more drilling platforms in our most precious lands and waters would make us understand that the true cost of oil is not posted at the gas pump.”

In her blog, Maria McLean is not letting us forget about the true cost of oil. She has been documenting various crusades waged by victims of the resource curse. Here are a few examples:

  • Nigeria’s highest court has finally put its foot down and ordered oil companies to stop wasting natural gas by flaring it. The bad news is that residents of the Niger River Delta have had to suffer the effects of it for 45 years.
  • Bolivia passed a law raising oil and gas production taxes and royalties to 50 percent, while making the state sole owner of production.
  • In Ecuador, a lawsuit aims to force Chevron to clean up the toxic mess it inherited when it bought Texaco.
  • In Venezuela, ExxonMobil is resisting President Hugo Chavez’s ultimatum: enter a joint venture with the Bolivarian Republic of Venezuela, or risk losing you’re the company’s Venezuelan oil business.
  • The Inuit of Alaska and Canada filed a 175-page petition in the Interamerican Court of Human Rights to produce plans for protecting Inuit culture and resources, which are threatened by the massive climate changes already being seen in the Arctic.

Get the details, and stay tuned for more reports from Maria.

Air Conditioning Reduces Hybrid Fuel Economy

The latest results from an ongoing evaluation of hybrid cars indicate the use of air conditioning has a dramatic effect on a hybrid’s fuel economy. "The hybrids we tested got 15 to 27 percent lower fuel economy with the air conditioning on," said Jim Francfort, principal investigator at the Idaho National Laboratory in Idaho Falls, which is operated for the Department of Energy.

Francfort has been evaluating hybrids for nearly five years. In 2001, while testing the Honda Insight and the first generation Toyota Prius—the first two hybrids introduced in the United States—Francfort and his team saw big influences from air conditioning. He said, "It was new technology and we were trying to learn. We thought we needed to do more tests to understand the impacts on fuel economy, based on how hybrid owners actually drive their cars."

In the worst case, fuel efficiency for the Honda Civic (pre-2006) with the air conditioning on was 27 percent lower than with the air conditioning off. In terms of miles-to-the-gallon, the Civic Hybrids averaged approximately 48 mpg without AC, but dropped to 35 mpg with the cool air blowing. The Toyota Prius was more than 20 percent less efficient with AC running, and even the mild hybrid Chevrolet Silverado pickup truck was 15 percent less efficient.

Learn more about the Idaho hybrid tests.

Thanks for reading our first newsletter of 2006. Best wishes for a happy and healthy new year! Until next time…

Happy Driving,
Bradley Berman
[email protected]

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