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April 18, 2007

The hard sell for hybrids

With gas prices still an issue, it may come as a surprise that hybrid sales aren't booming as a percentage of total vehicle sales. But N.C. State University economist Mike Walden cites three reasons for the drop-off.

"I think, one, the recent drop in sales may reflect the fact that we did have a decline in gas prices last fall and winter And now as gas prices are going up, we may see a revival of interest in hybrids," says Dr. Walden, a professor of agricultural and resource economics.

"The second issue, though, is hybrids cost more money. They cost as much as much as $3,000 more upfront, and that's a cost that takes several years to recoup in gas savings," he adds.

"And then, thirdly, I think some people are questioning the environmental savings regarding hybrids. Certainly you use less gasoline when you run a hybrid, and therefore you are going to pollute less when you are driving a car. But you have to ask the question -- the other fuel, electricity ... -- Where is that being generated from? Is it being generated from oil or coal? And if so, that may actually pollute more. So I think people are beginning to question really the background of hybrids and really how much they do help the environment.

"So I think for all these reasons hybrids are really not moving forward very fast right now," Walden concludes, "but I’m sure that dealers are going to address these issues in the future."

Posted by deeshore at April 18, 2007 08:00 AM