Thursday, August 18

Several Automakers Consider Discontinuing Large Luxury Hybrids After Lukewarm Sales

Not all experiments end well, as the auto industry has been finding out after offering gas saving hybrid models for vehicles that are known for having low fuel economy. So few of these vehicles were sold that automakers are now wondering whether they’re even worth engineering.

General Motors, after offering hybrid versions of its new generations of Cadillac Escalade, GMC Yukon, and Chevrolet Tahoe SUVs, has decided to pull the plug. Even though the Escalade hybrid delivered 21 miles per gallon (combined driving conditions), up 31% from the non-hybrid’s 16 combined, “No one bought them,” says David Schiavone, marketing manager for the Escalade. “And they were great.”

Mercedes-Benz and Lexus have also been pulling back on their offerings. One of the issues with selling the hybrid cars, according to Bill Kwong, a Lexus spokesperson, is cost. Hybrids, for example, add at least $6,000 to the price of Lexus’s 706 LS sedans. Only 1% of Lexus’s LS flagship sales are hybrids. Smaller cars in the brand’s lineup, such as the ES, fare much better — 25% of ES’s sold are hybrids.

John O’Dell, an editor for Edmunds.com, a well-known vehicle review site, explains that when luxury vehicles go hybrid, it makes “a very expensive car even more expensive.” Most people still seem reluctant to pay more in order to use less gas, or have a smaller impact on the environment.

“There are incremental gains with hybrid versions of larger vehicles, you just don’t get the same mileage improvements that you do in smaller hybrid cars.” says Eli Pruett, president of Bumblebee Batteries. “Additionally, it seems that the type of person that is driving an SUV probably does not care about fuel economy as much as someone who chooses to drive a smaller more efficient vehicle.”

A few brands, though, are performing well enough that they envision hybrid technology as being a mainstay for the future. Infiniti is now offering a hybrid version of its luxury SUV, the QX60, and according to spokesperson Kyle Bazemore, roughly 10% of buyers are choosing this option, which costs them $3,000 more.

It seemed several years ago that large, hybrid vehicles were a great idea and a concept that would sit well with buyers. Though the future of these models isn’t certain, it seems likely that auto manufacturers will look for alternative ways to boost fuel efficiency without dramatically increasing price as well.

Leave a Reply

Your email address will not be published.