March 2, 2006

Hybrids need to target entry-level buyers, analyst says

Freienbach, Switzerland – Automakers are approaching the European hybrid market from the wrong direction, automotive business intelligence company EurotaxGlass says, and asserts that the market will only flourish if hybrids are aimed at volume-selling segments.

The company says the prospect of lower fuel consumption will be vital in boosting the sales of hybrids, which will in turn help repay the investment in the technology. But a significant proportion of hybrids currently scheduled for production are large luxury cars or SUVs, where sales volumes are limited or in decline, and where buyers tend to be less concerned about fuel efficiency or emissions.

EurotaxGlass argues that carmakers must take full account of the differences in the U.S. and European marketplaces; it says hybrids being prepared for production indicate a heavy bias toward the tastes of the U.S. market, which tends to favour large vehicles. EurotaxGlass also notes that many Europeans choose fuel-efficient diesel vehicles, unlike North America, where hybrids do not have to compete against diesel.

EurotaxGlass suggests that all carmakers should target higher-selling segments, such as lower-medium and upper-medium, where competitively-priced hybrid power could present a viable alternative to diesel.

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