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Prius Marching, Not Charging, Towards the Future

Despite sales slump, new model could revive Toyota hybrid.

by on Mar.02, 2009

Third-generation Prius needs to charge up a hybrid market that's nearly collapsed.

The third-generation Prius needs to charge up a hybrid market that has nearly collapsed.

Toyota had its share of electrifying announcements this year, in keeping with the green glow automakers are trying to shine on an otherwise gloomy season. Many headline-grabbers were cars you literally do need to charge up, from GM’s Cadillac Converj concept to Toyota’s own FT-EV electric minicar.

With the 2010 Prius, however, Toyota shows it isn’t flinching in its steely-eyed march toward annual sales of one million plug-free hybrids globally “by the early 2010s.”

Contrasting with the claims that lithium is right around the corner, Toyota’s flagship is staying with tried-and-true nickel-metal hydride batteries. That’s in keeping with Toyota’s cautious plans for 500 plug-in hybrids to be leased late this year for “market and engineering analysis,” as the company states. Regardless of how hard some rivals charge toward plug-in propulsion, Toyota marches steadily forward with what might now be called conventional cordless hybrids.

It’s not a march without stumbles. Total U.S. Prius sales barely tallied 159,000 this past year, compared to 181,000 in calendar 2007. The drop was most precipitous over the past few months as falling fuel prices coincided with the collapse in the economy, credit and car sales overall. The 12% year-on-year decline in Prius volume was not as bad as the 18% decline market wide. The slowdown is enough to have some wags wondering if hybrid technology will get no farther than a small, granola-fed plateau rather than climb the hills of real growth.

The first hybrid-only Lexus, the LS250h.

The first hybrid-only Lexus, the LS250h.

Nevertheless, Toyota appears undaunted in its Shermanesque strategy of bringing to market ten new hybrids over the next several years. The evidence includes the latest concept from Lexus division, the HS 250h, which will offer the market its first entry-level, luxury hybrid-electric sport sedan.

As for the new Prius, its 50 mpg combined fuel economy is up 9% from the second-generation version and 22% better than the original, first-generation Prius. These efficiency gains will come in a package that is now fully mid-sized instead of compact, offers acceleration performance more mid-market than laggard, and is far more feature-laden overall.

So even with this downturn, are Prius sales and Toyota’s hybrid sales in general in line with the company’s master plan? Toyota’s manager of environmental communications, Jana Hartline, answers, “yes, we are on track,” explaining that it’s not a strategy that depends on what fuel prices are at any given point in time. The company intends to stay “completely in the product plan,” Ms. Hartline continued, noting that if an automaker tried to base its strategy on what gasoline prices are today, “you’ll be in react mode, which will put you behind the 8-ball all the time.”

That does evoke memories of how Toyota launched the original Prius in late 1997, a time of low gasoline prices that were soon to bottom out as the Asian economic crisis pulled oil down to $10 per barrel the following year. It also makes one note Toyota’s more recent plans for larger trucks, like the disappointing Tundra. Let’s just say that’s another story for another day.

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