Electric-Drive Vehicle Demand Recharged by Gas Prices

Just when it looked like electric cars were running out of juice, the return of $4 a gallon gasoline is generating new life for battery-powered vehicles.

Electric-drive vehicles, including hybrids, plug-in models and pure battery-powered cars, were the fastest-growing segment in the U.S. auto market in the first quarter, according to data compiled by Bloomberg. Sales of those models rose 49 percent to 117,182 vehicles in the first quarter, from 78,527 a year earlier before Japan’s earthquake and tsunami pinched output.

Electric cars and hybrids are surging in tandem with gasoline prices, which averaged $3.93 a gallon on April 3, approaching the July 2008 peak of $4.11, according to AAA. Toyota Motor Corp. (7203)’s Prius hybrid and General Motors Co. (GM)’s Chevrolet Volt plug-in hybrid electric car each had record sales in March. Nissan Motor Co. Chief Executive Officer Carlos Ghosn repeated he’s “bullish” that pure electric cars will capture 10 percent of the market by 2020.

“There are a lot of concerns today that the electric car is going to solve,” Ghosn said yesterday in an interview at the New York auto show. “People don’t want to have to go to the gasoline station. They just want to fill their tank at home. They want to make sure they’re not paying too much money for their gasoline bill every month.”

Sales of the Nissan Leaf electric car will take off in August when Nissan begins producing it in the U.S., boosting output and possibly lowering prices, Ghosn said.

Bloomberg

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One response to “Electric-Drive Vehicle Demand Recharged by Gas Prices

  1. Didn’t they just come out with an extraordinarily long time period, like 27 years for these purchases to break even?
    I just ran a non-scientific analysis on my cars. Assuming the Prius is $25k and will get 50 mpg (Toyota website). If I replace my ’05 Tahoe (16 mpg average, $8250 trade in from Edmunds) it would only take me 17.5 years to recoup the cost if I drove 12k miles per year at $4/gal gas. Trading in my ’89 Camry would only take 25 years. That assumes the taxes, insurance and other operating costs are a wash. $6/gal gas is 11.6 and 16.7 years, respectively. Who is kidding whom on the “buy a more fuel efficient car to save money gimmick?” I rented a Prius a year or so ago. Great gas mileage, lousy acceleration onto on ramps and terrible side and rear visibility. Probably isn’t too good a pulling boats and trailers either.

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