Fuel barons aren’t the only ones cashing in on constantly rising
gas prices, the price of petro has also created a new market for
local car dealers who can’t keep fuel-efficient hybrid vehicles in
stock.
Hollister – Fuel barons aren’t the only ones cashing in on constantly rising gas prices, the price of petro has also created a new market for local car dealers who can’t keep fuel-efficient hybrid vehicles in stock.
Tiffany Motor Company in Hollister has already sold four 2005 Ford Escape hybrids this year and is already taking orders on the upcoming 2006 model. North of town, Gilroy’s auto dealers have also enjoyed an increased demand for the innovative vehicles. In March alone, Gilroy auto dealers sold five hybrid vehicles to San Benito County residents according to the Cross Sell Report, which tracks what models were sold where.
Tiffany’s general sales Manager Jack Anerich has a simple answer for the new craze taking the auto world by storm.
“Strictly mileage,” he said.
The hybrid Escape gets about 10 miles more per gallon in town than the regular gasoline engine model of the same car, he said. And Toyota’s Prius, the nations best-selling hybrid, gets more than 55 miles per gallon, which is why Hollister resident George Barton bought one last year.
“I do a lot of traveling,” he said. “I don’t see gas prices going down again, and I’m tired of paying it,”
Barton said that people assume that, though a hybrid might save some money on gas, it lacks the performance of a conventional vehicle. Such an assumption is incorrect, he said.
“There’s no difference,” he said. “It has all the acceleration you need to get out of tight spots and drive the freeway, and it goes uphill beautifully.”
The fuel efficient cars are already popular in Gilroy, where two local dealerships are selling electric-gasoline hybrids as quickly as they reach the lot.
Gilroy Toyota offers the Prius, while Gavilan Honda offers the Insight and hybrid versions of its traditional Accord and Civic.
“We can’t keep them in stock,” said Joe Wright, a salesman at Gilroy Toyota. “The market is so overwhelming for the car that people will wait and give us deposits. It’s kind of a hysteria.”
Although hybrids represented less than 1 percent of the 17 million new vehicles sold last year, the U.S. hybrid market has grown by more than 960 percent since 2000, when 7,781 were sold, according to data released last week by the Southfield, Mich.-based firm R.L. Polk & Co.
Rosemary Kamei, a board member for the Santa Clara Valley Water District, purchased her Prius in February after waiting four months. When she signed up, there were 29 others ahead of her on the waiting list – far shorter than the San Jose dealership she first tried.
Before buying the vehicle, she checked out the hype by renting one for a weekend and driving to Yosemite National Park. She said she only used one tank of gas for the entire 550-mile round trip. That sold her on the Prius, which she purchased for $27,000. That figure is at the upper end of the price range, which can go as low as $22,000, depending on the options.
“I was willing to pay more because it is environmentally friendly,” Kamei said. “And the fact that I can get gas efficiency was on top of everything else. I used to spend $50 to $60 a week on gas. Now I spend about $20 a week. It is so cool.”
Hybrids conserve gas by relying on electric power “when you’re in the city, increasing speeds, climbing hills,” explained Mark Baines, a sales manager at Gavilan Honda. “Once you get up and going, the gas engine kicks in to maintain speeds.”
Baines has seen a similar frenzy for hybrid cars at his dealership. Currently, Gavilan Honda only has one hybrid car left on the lot and hopes to receive two more by the end of the month. Most are pre-sold before they ever reach Gilroy, according to Baines, who said there is no question that hybrid sales are linked to gas prices.
“When gas is over $2 per gallon, they fly out of the lot,” Baines said.
Less clear is whether the hysteria is justified.
A low-emission Toyota Corolla that gets 40 miles per gallon costs $5,000 less than a Prius, which gets 61 miles per gallon in the city and 52 miles per gallon on the highway, according to Wright. The gas-only models of the Accord and Civic sell for $27,365 and $17,175, respectively, while their hybrid counterparts cost $3,000 to $4,000 more.
The hybrid versions get an additional 10 to 20 miles per gallon.
“There is a price differential and it will take approximately four-and-a-half, five years to offset that differential,” Baines said. “As a consumer, you want to do your homework and make sure you’re either environmentally conscious or that you’re doing sufficient driving to merit the cost.”
Potential buyers may want to consider:
n Federal tax credits for hybrids: Those purchasing this year will receive $1,000 off their tax bill, although the credit will be reduced to $500 in 2006 before getting phased out in 2007.
n Possible HOV advantages in the future: California has passed a law that would allow hybrids to use high-occupancy vehicle lanes, although the federal government must pass similar legislation before owners can take advantage.
The Associated Press contributed to this report
