Carmakers and suppliers are wagering that consumer demand for a compromise between all-electric and all-combustion is a long-lasting trend as gas-electric hybrid car sales in the US soar and sales of electric vehicles decline. In response to growing consumer demand for technology, automakers and suppliers are expanding their capacity to produce gasoline-electric hybrid and plug-in hybrid vehicles for the US market. Previously, General Motors and other automakers planned to phase out their gasoline-electric fleets in favor of all-electric fleets, but industry executives and analysts said this was not the case.
Hybrid Vehicles Gain Momentum: Market Trends and Consumer Demand Propel Growth in Hybrid Sales
According to Morgan Stanley, US hybrid sales increased five times quicker in February than EV sales. According to Stellantis, the percentage of Jeep Wrangler SUVs sold in the United States that were plug-in hybrids increased to 50% in the second half of 2023 from 37% in the first half. Ford Motor’s hybrid Maverick small truck, which begins at $25,315, was the main driver of a roughly 37% increase in sales of the vehicle during the first two months of the year.
The general manager of Palm Springs Motors in Cathedral City, California, Scott Simmers, stated;
“The hottest car on our lot right now is the Maverick hybrid.”
Currently, dealers claim they could sell more Mavericks if Ford could develop hybrid versions of the vehicle, which account for around half of the model’s sales. Vice-president of Product Development at Ford, Jim Baumbick, told Reuters.
“We had to rush to add capacity for Maverick. We added a whole third shift to respond to demand.”
The Complex Intersection of Policy, Profitability, and Environmental Advocacy: Navigating the Transition from Internal Combustion Engines to Hybrids
Environmental organizations and the Biden administration’s pro-EV climate policies are put to the test by the industry’s transition toward hybrid vehicles, which calls for automakers to phase out CO2-emitting internal combustion engines as soon as feasible. This month, the White House is anticipated to release car CO2 emissions regulations that would compel automakers to offer up to 60% more completely electric vehicles by 2030. But the White House’s EV subsidies and pollution regulations are in jeopardy due to the US presidential election in November.
Because hybrids are a more profitable way to reduce CO2 if a future administration changes direction, experts stated that most traditional manufacturers lose money on EVs. The Biden administration’s potential incentives for manufacturers to sell more plug-in hybrids with combustion motors is a source of concern for proponents of strict pollution regulations for combustion engines.
Rising Hybrid Production in North America: Shifting Dynamics in Vehicle Manufacturing and Pricing
According to statistics given to Reuters by AutoForecast Solutions, North American output of hybrids, led by Toyota, Ford, and Honda, may climb to as much as 20% of total light-vehicle production by 2025, compared with 14% for EVs. According to AFS vice-president Sam Fiorani, “hybrid models have surged by roughly the same volume in the last year, while the EV outlook has been depressed by about a million units,” as reported by Reuters. As manufacturing has increased, Toyota has reduced the difference in price between hybrids and equivalent combustion-engine cars. According to Christ, the difference in price used to be as high as $6,000 to $7,000. It is currently between $1,500 and $2,000.
