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Consumers want MPG, but not at hybrid price

| Saturday, Feb. 4, 2012

Last week, the world's automakers put on displays of fuel efficiency during the public policy days of the Washington Auto Show as bureaucrats of every description toured the show, huffing, puffing and pontificating over public policy as it applies to automobiles.

The show has become a magnet for automakers since the EPA raised the corporate average fuel economy. The new mandate, a lofty 54.5 mpg for the 2025 model year, sounds like a good idea.

But what happens when buyers hit the showroom is a different story altogether. There's a reason for this, something politicians don't understand.

"You can make all of the public policies you want. People don't care," said Rebecca Lindland, director of research at IHS Automotive. "They make decisions based on what's going on inside their own home."

This might explain her findings, revealed at the public policy days of the 2012 Washington Auto Show.

The big headline• Despite the fact that there are 29 gas-electric hybrid models on the market, hybrid car sales are falling. "We're not buying the hybrid brand," Lindland said. "People are buying Prius, but we're not buying into hybrid technology; not when we're getting such tremendous improvements in internal combustion engines."

Nationally, hybrid market share has declined since it reached its market share peak of 2.78 percent in 2009. In 2011, it was 2.10 percent, according to AutoData.

Hybrids are being challenged by conventional cars that are more fuel-efficient than ever and command lower prices.

A midsize Hyundai Sonata returns 40 mpg in highway driving, while the Toyota Prius returns 48 mpg in highway driving. According to the EPA, it costs an additional $499 annually to fuel the Elantra, but it has a base price $8,175 lower. So, it would take more than 16 years of additional fuel costs to make up the difference in base prices between the two cars.

That's not to say we aren't buying more fuel-efficient vehicles; they're just not as efficient as environmentalists or the government might want.

"Small car sales are growing, but it's a push system in that the manufacturers are bringing them out because of fuel-economy standards," Lindland said.

This explains why small-car sales grew 18.9 percent last year, according to AutoData, while crossover utility vehicle sales grew 26.8 percent, accounting for more than one in four new vehicle purchases. Trucks accounted for 52 percent of the new car market in 2011.

"All of those Chevrolet Suburbans we bought in 2000 and 2001 are all being swapped out for crossovers that consistently get anywhere from 15 to 25 percent better fuel economy," Lindland explained.

Don't expect people to ditch their Escalades for Elantras; it's more like an Escalade for an Equinox.

"It's not about fuel economy; it's about the most fuel-efficient version. We are proud of ourselves when improve our fuel efficiency by 20 percent, but only if it's the vehicle that we want to drive."

All of this is a vivid reminder that while lawmakers may pass laws, we are the final arbiters of what is truly acceptable.

Larry Printz is automotive editor at The Virginian-Pilot in Norfolk, Va.

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