In less than two years, Toyota plans to sell a plug-in version of its popular Prius hybrid to consumers. The company will want to fend off challenges to its green crown, which will be aplenty by 2011. Nissan will be selling its Leaf electric car. General Motors will have the Volt, to name a couple of them.
But will there be enough buyers for all of these high-tech rides? Toyota will start selling the Prius in test batches next year but will offer the car to consumers in 2011. The company expects to sell tens of thousands of the car. GM has similar ambitions for the Volt and Nissan expects the Leaf to garner a lot of interest. On one hand, Prius buyers have a lot more cash than people who typically buy $25,000 cars. The average Prius owner makes $84,000 a year and half of them earn more than $100,000 annually.
On the other, advanced cars like plug-in hybrids and pure electric vehicles will be expensive. The National Research Council put out a report on Dec. 14 saying that plug-ins could be as much as $18,000 more than conventional car. If fuel stays under $4 a gallon in the U.S., car buyers won’t get a payback on the added cost, not even close.
Of course, there will be plenty of buyers who want to be green, make a political statement or test out the latest technology. But it probably won’t be enough for every carmaker to hit their targets on sales of these advanced cars. What they really want to do is make their own statement. When these cars hit the market, every carmaker will be flogging their technology to make a case that they have the killer app. While all of them may be impressive, each will have short comings.
The Volt may get the most pure electric range without needing to recharge, but it could cost more than a Prius plug-in. The Prius may have a price advantage, but won’t be as purely green as a Leaf. The Leaf won’t go farther than 100 miles without needing to recharge. The upshot: It will be a nasty sales battle and profits will be tough to come by.