Invasion of the Green Machines
High gas prices have drivers chasing after hybrids. Is it a fad or a phenom?
Moon roof. But J. D. Power forecasts that hybrid fever will cool off once the dual-powered vehicles hit about 3 percent of the market, probably around 2011. Pragmatic mainstream buyers may prefer to spend extra money on performance and comfort options instead of a feel-good power train. David Backman of Minneapolis looked at a Prius when he was shopping for a new car last year. But the computer specialist settled instead on a Hyundai Elantra GT. The mileage isn't as good, but he was able to load it up with a moon roof, leather interior, and other goodies, all for $9,000 less than the Prius. "At 10,000 miles a year," he concludes, "I would never come close to recouping the premium."
GM's Burns sees other limitations of hybrids--under the Prius's hood. When Toyota introduced the second-generation Prius last year, GM joined the mad dash of consumers rushing out to buy one. But not to drive. Instead, GM engineers disassembled the car at the company's Vehicle Assessment Center in Warren, Mich., and laid the guts of the propulsion sys-tem out on a long shelf. One major discovery: The Prius's hybrid power train contains 42 percent more parts than the machinery that moves a similar-size Chevrolet Malibu. That, argues Burns, is too much complexity for the car of the future.
A new kind of gas. Instead of cars with two motors and space-hogging batteries, he says, the automakers who rule the roads in the 21st century need to invent sophisticated but simpler cars that are cheaper to build. That's one reason that GM, like DaimlerChrysler and other automakers, is putting its chips on hydrogen-powered cars.
But the auto giant has a history of misjudging the market. Around the time Toyota was designing the first Prius, GM was rolling out the EV1, a battery-powered electric car that debuted, with much fanfare, in 1996. For less than the cost of a tank of gas, the car's batteries could be recharged at home, overnight, which led GM to tout the oblong two-seater as the car of the future. But progress in battery technology stalled, and the range never eclipsed 150 miles, which severely limited its appeal. Last year, GM decided to cut its losses on the $1 billion project and retired the last of the 1,000 cars that had been leased to consumers. An EV1 is now headed to the Smithsonian.
Hybrids are a more urgent matter. GM and DaimlerChrysler recently joined forces on a crash R&D program, and both companies plan to introduce their first full hybrids in 2007. GM in particular could leapfrog its rivals by introducing full-hybrid versions of products that are still market heavyweights, like the Chevy Silverado pickup truck and the TrailBlazer SUV. Meanwhile, other automakers that have confidently dismissed hybrids as a fad are suddenly racing to catch up with Toyota and Honda. Cash-rich Nissan has purchased Toyota's technology and is rushing a system to market. Ford subsidiary Mazda plans a hybrid version of the Tribute SUV. Even BMW promises a hybrid announcement later this year. Most drivers may never track their mileage in a notebook, yet there may be no way of escaping cars with a conscience.
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