/ January 2, 2009

Decline in Hybrid Sales May Translate into Higher Fuel Taxes

Sales of hybrid cars in the United States this November were down 53% compared to the same month last year.  December sales results look like they are going to follow suit.  Online searches for hybrids are only a quarter of what they were in May of this year.

The problem may lie in the lower gas prices we are enjoying this winter – especially in this economic time.  Since Hybrids cost between $3,000 and $5,000 more than regular car, it’s tough for lots of consumers to justify increased car payments when gas is selling at $1.60 per gallon in many U.S. cities.  It’s now estimated that it will take more than eight years to recoup the extra costs associated with a hybrid.  When gas was around $4 per gallon, the Hybrid seemed more savvy an investment.

If you are looking for a good reason to buy a Hybrid despite all of this, check out their favorable depreciation ratings.  Also – check out reports that lower Hybrid sales may translate into higher taxes on fuel to make buying a Hybrid more attractive.

Source: The Financial Times

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