Wednesday, June 11, 2008

 

$4 gas! Time to buy a hybrid? The Today Show

A good friend of mine that runs a green mattress company called Essentia Direct that also owns a Prius told me about the show he and his wife watched yesterday morning. He told me that he and his wife could not believe what they were saying about hybrids.

So I went online to find this show. Just so you now, that was pain also. You would think that you could go to MSNBC and click on the TODAY SHOW and type in the search term Hybrid and you would get a link to the video. Well it wasn't that simple so I have the link posted below.

The show is 6 minute piece on hybrids and whether or not they make financial sense to purchase over a comparable non hybrid. I am glad that they covered the topic but they did a horrible job reporting the benefits and the cost of ownership. I am also extremely annoyed that they somehow managed to turn the entire discussion into an investment piece on hybrids. Since when did the purchase of a vehicle turn into an investment? I have never heard of a show on television discussing vehicles and their break even points? When has anyone purchased a car and expected to break even? Everyone knows that a car is an expense unless you are buying low cost used cars or you can find some crazy special from an angry couple getting divorced it is treated as an expense.

Nobody in this segment mentioned the word ENVIRONMENT. See the line by line breakdown of the piece at the bottom of this entry.

Again, I don't want to be unfair. I am very glad that they did a piece on hybrids but the approach just seemed way off.

I do not know what kind of math the folks over at Edmunds.com use but it is something we here at PHEV.com cannot figure out. I would have to argue that somebody must have spilled one of those super sweet caramel frapacinos on his abacus when he or she was figuring out the cost of ownership. Also I don't understand how this fella "Chubba" could possibly work for Car and Driver, let alone be the editor-in-chief. Holy smokes! He said that Hybrids are only good for city driving? So I guess that 2 - 3 miles difference in MPG's from highway to city is such a huge difference that a telecommuter cannot benefit from a hybrid because he or she will only get 42 miles per gallon versus the city driver that will get 45 miles per gallon. What is this guy talking about?

People need to stop thinking of the hybrid as some crazy weird piece of equipment that doesn't function like a regular car. You don't have to take a class to drive one. You don't have to get a new garage or a new driveway. You don't need to where headphones and talk to other hybrid owners to get around town.

Lets go back to the math. If you own a Prius for $350.00 per month and you drive 1,200 miles per month or you drive another vehicle that costs the same $350.00 per month and drive 1,200 miles and it gets 14 miles per gallon.

Your gas payment a month is $364.00 vs $121.00. How is it possible that in 3 years a savings of $8,748 doesn't make a hybrid a good investment. Regardless of its environmental impact or what it does to reduce our dependency on gasoline. I mean c'mon. I understand that gas prices can go down or go up but this story was simply put ridiculous in my humble opinion.

Why would you only cover the cost of a hybrid and its break even point of a comparable non hybrid? It is just one sided and they made it seem like hybrids were sort of a bad idea.

How can you cover hybrids and not do the math with respect to the average vehicle? What is this guy Chubba talking about in his first few lines... 10k cost to get in to one over a non hybrid vehicle? It is possible that it makes total sense but I have no idea what he is referring to in his statement or comparison. Or how about his statement... ""Its never going to pay back at that point." Man what Lexus, Mercedes, BMW, Porsche, Ford pickup, SUV pays back in a couple of years? Give me a break. This a perfect example of figures don't lie but liars can figure... I don't think Chubba is a stone cold liar but I think the way this hybrid show took shape is disgusting. There isn't nobody out there that would come away from this episode thinking it is a good idea to buy anything but a hybrid Chevy Tahoe and if you were even convinced of that I would be surprised....

The poor guy from Edmunds sounds a little crazy because he got put on television the same way Bill O'reilly puts his guests on... Strictly in edited format without any details.... We don't even know what this guy is talking about. Now I am not impressed by Edmunds.com but that is a separate entry. Edmunds.com is doing a poor job of reporting on hybrids. Aside from that I still think they got the short end of the stick with respect to my review of their input on this piece because they were not given a chance to explain themselves in detail.

What was Matt Lauer and Phil Labeau thinking? What car have they bought that was a break even over the last vehicle they purchased? I do not understand why a hybrid has to be a break even over the non comparable hybrid. Why was there no mention of the intangible benefits of a the hybrid? That's what is bothering me the most. They could have taken 15 seconds and mentioned the benefits.

Take a look at the piece for yourself at MSNBC.com The link is http://today.msnbc.msn.com/id/12065856/

You must search for the video titled:


$4 gas! Time to buy a hybrid?

Here is the video line by line.


MATT: "With gas prices now on average above $4 per gallon is it time for you to start thinking about buying a hybrid vehicle CNBC's Phil Labot takes a look...."

PHIL: "With consumers around the country trying to cut their gas budgets. Many are clamoring for fuel efficient hybrids and dealers can barely keep them stock.

Angelo Beltrano of Grossinger Toyota in LincolnWood, Illinois says: "I could sell a 100 plus a month if i had them right now.

PHIL: "Demand is so high he has sold out of the popular toyota prius and says he has a 6 month waiting list of 80 people.

Angelo Beltrano of Grossinger Toyota in LincolnWood, Illinois says: "Yeah, it has been tremendous.... again the demand is far exceeding the supply.

PHIL: "But do the long term savings at the pump out weigh the purchase price.

EDMUNDS JESSE TOPRAK: "Most hybrid vehicles though will still take you over 5 years to pay back in terms of the premium you pay."

PHIL: "On average with higher price models it takes 5- 10 years for a customer to recoup the money they will spend on a hybrid compared to a compriable standard model even when factoring in the savings on gas. its not just the premiums for hybrid technology."

EDMUNDS JESSE TOPRAK: "the dealerships in certain metropolitan areas selling toyota prius's two, 3 thousand dollars over manufacturers suggestedretail price."

PHIL: "As americans race to exchange their gas guzzlers for fuel efficiency Dealers have hiked up the price. It is easy to see why some dealers are charging more for hybrids right now....there is a frenzy of demand being driven by consumers desperate to buy models that give them better mileage.

DUTCH MANDEL (editor AutoWeek Magazine): "Think of a horror movie where people rush from the door screaming. Thats really what these hybrid buyers are doing. Trying to get out as soon as possible..."

PHIL: "Some like toyotas camry only takes 18 months to break even. but many hybrid SUV's may be more fashionable than practical.

EDMUNDS JESSE TOPRAK: "Its kind of like a sugar free chocolate. You know you get your large SUV but you don't have the stigma attached to owning one."

PHIL: "According to Edmunds ToyotasHiglander can take almost 12 years... And the Saturn Aura Greenline takes over 22 years before buyers will realize any savings."

EDMUNDS JESSE TOPRAK: "Consumers need to do their homework before they go out presuming that they are gonna save money because they are buying a hybrid."

PHIL: "For Today, Phil Labo CNBC Detroit."

** We are not back to Matt Laur outside in NYC with the crowd and cars behind him **

MATT: "Let me tell you that Toyota tells MSNBC news that it disagrees with the way Edmunds dot com calculates the payback time for hybrids. and says the true payback for the highlander is 7 years..
Saturn says The Aura is the lowest price mid size hybrid sedan and that payback numbers are often skued because the standard aura has different standard equipment from the Aura hybrid."

"Lets bring in Csaba Csere (pronounced Chubba Chedda) he's the editor in chief of car and driver magazine. He can maybe fill us in more on this."

"Hey Chubba good morning to you"

CHUBBA: "Good morning."

MATT: "So whats the deal? Are Hybrids worth it? Do they make sense? Do we see real savings and save energy?

CHUBBA: "You definitely save energy. I mean a car like this Prius gets 45 miles per gallon in the real world and thats about 50 percent better than a comparable non hybrid car, but that depends on how much money you need to spend for that because that kind of savings saves you 500 bucks a year and you might have to spend 10 thousand dollars to get there."

MATT: "So lets talk abut good candidates to buy a hybrid and bad candidates. lets start with the good candidates. Who should think about a hybrid?"

CHUBBA: "Well number 1, you got to drive a lot of miles. the more miles you drive the more you save."

MATT: "What kind of driving, though?"

CHUBBA: "City Driving. City is where the hybrid is best. in that stop and go driving thats where a hybrid shines. And the third person is the person who is gong to buying a new car anyways. . Because if you are trading in a gas guzzler right around now you are going to take a real beating."

MATT: "But to realize the real savings you want to keep that care for awhile as well, don't you?"

CHUBBA: "Absolutely because that payback time is relatively long and if you are the type of person who buys a car and drives it into the ground you are the perfect hybrid buyer."

MATT: "So a bad candidate is a someone that does a lot of highway driving and plans on getting a new car within a couple of years?"

CHUBBA: "Its never going to pay back at that point."

MATT: "This is the one that everybody talks about. This is the Kleenex of tissues. This is the Pirus. Why is this such a good car. And why is it in such hot demand. How longs the wait?"

CHUBBA: "Well the wait at this point is probably up to 6 months in some areas. but its amazing how quickly that changed. A few months ago there was no wait on the Prius. When the gas prices go up the Prius wait line goes up even faster. It is in such demand because it gets 45 miles per gallon. It's got enough room inside for four people our size. It looks really good. And by the way it is uniquely a hybrid so everyone sees that it is a hybrid."

MATT: "How much is it?"

CHUBBA: "It starts at about 22 and but fully loaded can go over 29."

MATT: "Alright lets go to another Hybrid over here.. This is the Honda Civic.. Are they available?"

CHUBBA: "They are available. But there is going to be a wait list on these too, on all of these hybrids there is a shortage of batteries and thats what's limiting the production. But it is very comparable to the Prius in the way it drives and roughly the way it costs."

MATT: "So you get about the same mileage and cost about 23 - 28 thousand dollars?"

CHUBBA: "Thats right, and uh slightly worse mileage but very close."

MATT: "For people who have never driven a hybrid Chubba what should they expect. Is it going to feel different to them?"

CHUBBA: "It is going to feel different in two ways. They all have what's is called a continuously variable transmission. you don't feel any gear shifts. It is totally step-less. And The other thing is Hybrids turn off when you are stopped at a light to save energy, so it goes dead silent."

MATT: "You here people say all the time, I would buy a hybrid but I have a big family and truck around a lot of stuff all the time. Is this the answer, the Chevy Tahoe?"

CHUBBA: "It's one of the answers. I mean, this is the largest hybrid on the market. It's got three rows of seats, it can tow 6,000 pounds."

MATT: "What kind of mileage does this get?"

CHUBBA: "Well it gets about 20 which is way less than these machines. But you know a line backer eats more than a jockey. Its still about 50% better mileage than the non ybrid Tahoe gets."

MATT: "Does it feel like its got power?"

CHUBBA: "Oh yeah it absolutely has just as much as power as a regular one which by the way isn't true of these two. These are slightly slower than conventional cars."

MATT: "50 thousand to 55 thousand, can you get these or is a wait for these as well?"

CHUBBA: "No I think you can get these at this point although they are not going to be lasting for long."

MATT: "Alright Chubba Chedda, Chubba thanks very much. Good to have you here."

Comments:
The Today Show conversation was totally dull. I own a Camrey I'm selling to buy a Prius. comparing Camrey to Prius the Prius is only about $2000 more. I get that back in two years or less by the better gas mileage of the Prius.

It's clear that the American auto industry is coming out of a coma and haven't grasped the reality of higher priced oil imports. The socalled "primium" for a prius will pay you back handsomly and will do so in it's high value for resale.

So eat your heart out, gas guzzler consumers. Enjoy spending your hard earned money on inflated fuel prices! if you don't like it, tell your favorite automobile manufacturer that you want something that won't bankrupt your lifestyle.
 
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