Higher Gas Prices May Lead To Hybrid Surge

Ford sells four hybrid models including this Mercury Milan Hybrid sedan.

You might think that gasoline was retailing for above four dollars a gallon the way that hybrid sales have been acting of late particularly for one automaker.

Ford Hybrid Demand Surges

On the strength of its release of the Ford Fusion Hybrid and Mercury Milan Hybrid this past spring, the Ford Motor Company is enjoying a 73% increase in hybrid sales for the year. Couple these midsize sedans with the automaker’s two compact crossover hybrids – the Ford Escape Hybrid and Mercury Mariner Hybrid – and you can see why hybrid sales are on the increase during a time when gas prices are flat and overall sales abysmal.

With oil moving above $75 a barrel and the world’s economy on the mend, demand for fuel will only accelerate, perhaps returning gas prices to levels last seen in Summer 2008. While this forecast bodes poorly for the typical driver, it will likely cause many car shoppers to to look for vehicles which offer outstanding fuel economy. And with an Environmental Protection Agency (EPA) mileage rating of 41 city/36 highway, the five passenger Ford sedans offer plenty of interior room for the fuel economy.

Conquest Sales Delight

Most telling about the way that the Fusion and Milan hybrid models are performing is just who is buying these cars. Ford reports that sixty percent of Fusion Hybrid sales are from non-Ford owners, with more than half of those from foreign makes. Toyota and Honda owners make up more than half of those conquest sales, a very good indicator of just how well these cars are being received.

Ford shocked the green world earlier this year when the EPA released its mileage estimates for the hybrid sedans which easily topped the industry standard-bearing Toyota Camry Hybrid whose own ratings are 33 city/34 highway. A quick survey of the market shows that around town the Fusion Hybrid beats mostly everyone including the diminutive Smart Fortwo, Volkswagen Jetta TDI and the Honda Civic Hybrid.

Fleet Uses Surge

Part of the reason why demand for Ford hybrids is surging has everything to do with government and taxi industry fleets welcoming these models.

In San Francisco, more than two hundred Ford Escape Hybrid taxis ply the streets of this hilly city by the bay. Fifteen of those models have pushed past 300,000 miles and are now being replaced, having first been put into service in 2005. That is a strong tribute to the durability of these hybrids and should dispel worries among buyers that the technology can’t function beyond 100-150,000 miles as originally thought by some.

The New York Taxi fleet is the largest in the world and with some 13,000 plus hybrid models in service it makes for a good indicator on how these vehicles perform in all kinds of conditions. As the saying goes, “if you can make it in New York, you can make it anywhere,” Ford’s contribution to the fleet is 2000 Ford Escape Hybrid models strong. Like San Francisco, a number of the earlier models have pushed past 300,000 miles and will soon be replaced by new Ford hybrids.

Ford Knocking On The Door

For Ford, the auspicious growth of its hybrid program puts its sales in the range of Honda, the number two retailer of hybrid vehicles in America. While Toyota remains far out front of the pack, Ford is proving that demand for its vehicles remain strong and that it can beat even the industry leader at its own game, taking sales away from its chief competitors and increasing overall manufacturer market share as well.

References

Ford Escape Hybrid taxis demonstrate durability on New York streets

San Francisco’s hybrid taxis prove their worth

Photo Credit: Ford Motor Company