Sales of Hybrid Vehicles Surge in the Midwest

Considered by trendsetters on the coasts to be fly-over territory, the heartland is rarely viewed as being central to defining the state of the automobile field. Yet, an enlightening Hybrid Analysis by R.L. Polk & Co. now shows not only a surge in new hybrid vehicle purchases for the first seven months of 2007, but a shift in where this is occurring. Surprisingly, 56.9 percent more hybrid vehicles were sold in the Midwest during the first half of 2007 than the same period a year before. In effect, car buyers in the heartland are taking hybrids mainstream.

High and unstable gasoline prices, along with concerns about fuel supply, are credited with spurring this swing in buying habits. Across America, consumers are accepting and even embracing hybrid technology. Toyota is clearly the biggest winner, earning rewards from its substantial investment in hybrids and long-term view of this evolving technology. The Toyota Prius nearly doubled sales in the region by posting an 88.3 percent increase.

The statistics are interesting: Prius claims just over 50 percent of the overall hybrid market share. The recently introduced Camry Hybrid — the 2007 Green Car of the Year® — is second in overall registrations during the growth period, grabbing a 15 percent share. Between Toyota and Lexus divisions, the company owns more than 78 percent of the U.S. hybrid market. That's a 4 percent increase over 2006 sales figures. The Honda Civic Hybrid had 9.1 percent of the total hybrid market for the first part of 2007.

Leon Miller, Polk director of industry analysis, explains, "While the overall U.S. vehicle market is down, hybrids are a bright spot in the automotive industry with this category projected to easily exceed 300,000 vehicles this year. At this point, hybrids account for more than 2 percent of the total U.S. vehicle market, which is supported by the regional growth we've seen."

While the Midwest led with the largest percentage of increase, hybrid sales were up considerably across the board. The next largest increase in sales was in the already strong Western states with a 51.8 percent increase in sales. Not surprisingly, the Northeast was right behind with a 49.3 percent increase, followed by the Southern region with a 41.5 percent boost. Hybrid sales were up an impressive 49.3 percent in the first seven months of 2007 for the country as a whole.

There were only a few negatives in the Polk Analysis. One was a decline in registrations of the Toyota Highlander and Lexus RX400h SUVs. The Highlander reduction is easy to explain since the 2007 model was at the end of the platform's lifecycle and an all-new 2008 Highlander Hybrid goes on sale to the public in late 2007. The only state to show a decline in hybrid registrations was Hawaii, with a downturn of just 5.3 percent. At the other end of the scale, Oklahoma showed the most growth, with a 143 percent increase in hybrid sales.

Clearly, middle America is changing its new car buying habits. "Hybrids are being adopted by vehicle buyers in all regions at an increasing rate for many factors which include fuel prices, differentiating themselves from other consumer and environmental activism," Polk's Miller continues. "The data indicates that hybrids have not hit a plateau and that there is room for continued growth within the marketplace in all regions."

Southern states showed the slowest growth in hybrid conquest sales, but that number could change dramatically as GM's full-size two-mode hybrid trucks become available. Texas and adjoining states are considered big truck country, so their hybrid options have been very limited. It's not surprising that GM decided to showcase the new two-mode hybrid Tahoe and Yukon SUVs at the State Fair of Texas.

Hybrid choices will grow in 2008, with popularity fueled through increased availability and variety. In addition to the new GM two-mode full hybrid SUV entries, GM will field three new mild hybrid models to entice first-time hybrid buyers into the fold. Saturn is offering a redesigned Vue Green Line Hybrid, a new Aura Green Line Hybrid sedan, and Chevy will offer a mild hybrid version of the popular Malibu. For 2008, the Ford Escape-Mercury Mariner family of compact hybrid SUVs is joined by a Mazda Tribute Hybrid. Down the road, Toyota is planning to expand hybrid offerings across the board.

The potential for hybrid sales growth is substantial, especially when you consider that most existing vehicle lines may benefit from a hybrid model on existing platforms. Now that hybrids are playing in Peoria, it seems the possibilities are endless.