Conventional wisdom is that hybrid vehicles reduce our dependence on foreign oil and emit fewer environment hurting CO2 emissions. When comparing a hybrid to a conventional gasoline-powered model on a mile-by-mile basis, there’s some logic to this argument provided the pricing disparity between the two models isn’t too broad. However, a new study by Quality Planning shows that hybrid owners drive much more than non-hybrid owners, potentially negating the benefits of the added battery pack and electric motor.

Quality Planning studied nearly 360,000 vehicles throughout 2007 and 2008 to analyze driving habits, and some of the study’s findings are pretty surprising. According to the survey, hybrid and non-hybrid drivers have statistically similar commutes, but hybrid owners drive their vehicles 25% more (2,000 miles) in non-commuting scenarios.

Dr. Raj Bhat, president of Quality Planning, thinks part of the reason for these findings has something to do with the fact that high mileage drivers are typically more interested in hybrids than infrequent drivers.

“What we don’t know is whether owning a hybrid vehicle encourages people to drive more miles each day or take more pleasure trips. High-mileage drivers appear to be attracted to these vehicles, so insurers should take steps to verify the intended use of hybrids and validate actual miles driven wherever possible.”

The study also shows that hybrid owners are significantly more likely to receive traffic tickets. According to the survey, Toyota Prius owners received .38 tickets per 100,000 miles driven, versus a non-hybrid average of .23 tickets per 100,000 miles. That’s a 65% differential. One possible explanation for the ticket disparity has to do with where hybrid owners live. Quality Planning found that hybrid owners are more likely to live in an urban setting, where tickets are more frequently issued.

If you really want a hybrid and you don’t want to hear any more bad news, you should stop reading. QP also found that repair costs are significantly higher for hybrid owners. The Ford Escape Hybrid, for example, costs 31% more to repair than the gasoline-only model, while repairing the Toyota Highlander Hybrid will reportedly add 45% more cost. A recent report by IntelliChoice that found that, in the long-term, hybrids and diesels are actually cheaper than gasoline-only vehicles.

The text below illustrates how much on a per dollar basis hybrid repair costs for collision and comprehensive coverage versus one dollar for a non-hybrid. The disparity is shrinking every year, but according to QP, hybrids still cost more to fix. Hit the jump to view the Quality Planning press release.

Collision Comprehensive
Coverage Coverage
2006 Hybrid Models $1.16 $1.75
2007 Hybrid Models $1.09 $1.35
2008 Hybrid Models $1.13 $1.17

[Source: Quality Planning via Marketwire]

PRESS RELEASE:

SAN FRANCISCO, CA–(Marketwire – July 15, 2009) – With gas prices on the rise again, energy-conscious consumers are looking to save on fuel costs, and hybrid vehicles are a popular choice when gas mileage is a primary concern. However, an analysis of the driving habits of about 360,000 vehicle owners by insurance services company Quality Planning has concluded that many owners of hybrid vehicles drive as much as 25 percent more miles than owners of non-hybrids, and that hybrid vehicles are often more expensive to repair.

Numerous studies have compared the cost of ownership of hybrid vehicles versus conventionally powered vehicles, but driving behaviors of the owners of hybrids and vehicle repair costs are generally not part of the analyses. To understand driving behaviors of hybrid vehicle owners, Quality Planning looked at classes of vehicles for which both hybrid and conventional engines are available and examined annual mileage for both vehicle types. Also considered were two common auto insurance rating variables: everyday driving (normally termed “pleasure use” by auto insurers) and “high-commute” driving (defined as commuting more than 15 miles per day).

Do hybrid vehicles encourage owners to drive more?

Quality Planning found that while the mileage for high-commute drivers was roughly the same for both types of vehicles, those drivers who use their hybrid vehicles for non-commuting purposes drove an average of 10,500 miles per year — 2,000 miles (or roughly 25 percent) more than non-commuting drivers of non-hybrid vehicles.

“The additional miles driven by hybrid vehicle owners would seem to offset the net ecological benefit of owning a fuel-efficient vehicle. After all, a gallon of gas is a gallon of gas, no matter which type of engine is burning it,” said Dr. Raj Bhat, president of Quality Planning. “What we don’t know is whether owning a hybrid vehicle encourages people to drive more miles each day or take more pleasure trips. High-mileage drivers appear to be attracted to these vehicles, so insurers should take steps to verify the intended use of hybrids and validate actual miles driven wherever possible.”

To further assess the risk represented by hybrid vehicles, Quality Planning looked at the demographic profile of their owners and found that they are frequently women, typically older, more affluent, and often live in cities. Quality Planning also looked at the number of moving violations issued to Toyota Prius drivers and found that those drivers tend to get more than their fair share of traffic tickets (0.38 violations per 100,000 miles driven, compared with an overall average of 0.23). However, this 65 percent difference may be because urban drivers generally receive more traffic citations.

Will a damaged hybrid cost more to repair?

Quality Planning also looked at the loss experience of conventional vehicles versus hybrids by comparing the collision and comprehensive loss costs of both kinds of vehicles. Loss costs include impact of both frequency (the number of claims per 100 insured vehicle years) and severity (the dollar impact of a claim). For all 2008 model-year hybrids, collision coverage loss dollars were 13 percent higher, and comprehensive coverage loss dollars were almost 17 percent higher. The 2006 and 2007 models had substantially higher comprehensive losses.

When comparing specific 2006-2008 models, the highest collision loss costs were associated with the Toyota Highlander hybrid (45 percent higher) and the Ford Escape hybrid (31 percent higher). In general, there were increases in both frequency of claims and severity of claims for hybrid vehicles. When compared with a baseline loss cost of $1 for the equivalent non-hybrid model, the hybrid models had the following loss costs:

Collision Comprehensive
Coverage Coverage
2006 Hybrid Models $1.16 $1.75
2007 Hybrid Models $1.09 $1.35
2008 Hybrid Models $1.13 $1.17

“These findings should be of particular interest to auto insurers. Some currently offer policy discounts on hybrid vehicles. A 25 percent increase in miles driven or a 30 percent differential in loss costs is very significant,” added Dr. Bhat.

Study methodology

Quality Planning sampled 359,309 vehicles from multiple carriers across the country over a two-year period from January 2007 to December 2008. The vehicles were re-underwritten using Quality Planning’s proprietary program for correcting rating errors, Precision Re-Underwriting™. The vehicles analyzed were hybrid vehicles that had equivalent non-hybrid counterparts. The annual mileage estimates were obtained from Quality Planning’s proprietary RISK:check® process, which uses statistical estimates and odometer readings when available; the estimates were confirmed by policyholders through mail and phone contact.

About ISO

A leading source of information about risk, ISO provides data, analytics, and decision-support services to professionals in many fields, including insurance, finance, real estate, health services, government, human resources, and risk management. Using advanced technologies to collect, analyze, develop, and deliver information, ISO helps customers evaluate and manage risk. The company draws on vast expertise in actuarial science, insurance coverages, fire protection, fraud prevention, catastrophe and weather risk, predictive modeling, data management, economic forecasting, social and technological trends, and many other fields. To meet the needs of diverse clients, ISO employs an experienced staff of business and technical specialists, analysts, and certified professionals. In the United States and around the world, ISO helps customers protect people, property, and financial assets. For more information, visit www.iso.com.

About Quality Planning

An ISO business, Quality Planning is focused exclusively on providing rating integrity solutions to auto insurers. Quality Planning works with insurance companies to identify areas of significant rating errors using sophisticated database management, statistical analysis and modeling, customized survey design, and highly targeted customer interaction. Quality Planning helps clients work within their existing rating plans and charge fair prices to policyholders based on a true representation of risk. The company was founded in 1985 and is headquartered in San Francisco. For more information, visit www.qualityplanning.com.

[Source:Autoblog]

While the Honda Accord dominated the 1990s, it has been virtually all Toyota Camry in the new century. Yet a look back at the first six months of 2009 shows that the newer, larger Accord is continuing to gain ground on its chief rival. Camry sales have so far remained top in its segment, with 150,242 sales in the first half of the year. The Accord isn’t far behind, though, as it has amassed 131,143 sales through June; only 19,199 behind Camry.

Wards Auto reports that the Accord’s gains have been consistent over the past three years, as the sales gap went from 94,004 in 2006 to 80,877 in 2007 and 63,828 in 2008. With sales deeply depressed so far in 2009, though, the numbers can be a bit deceiving. Still, the Camry has seen a 37.4% drop in sales, as compared to 36.3% for the Accord.

Toyota told Wards that one reason for the Accord’s improved sales verses the Camry are increasing incentives on the full-size Honda. According to Edmunds, the Accord’s April incentives increased four-fold verses the automaker’s April, 2008 numbers. Even more interesting is the fact that cash on the hood has increased since April, hitting $2,183 in June. The Camry, on the other hand, had $1,538 on the hood last month; down over $400 compared to May.

[Source: Wards Automotive]

General Motors, Ford, Chrysler, Honda and everyone else may not think there is much of a market for mainstream diesel vehicles in the United States, but Volkswagen would beg to differ. Since it launched its new generation diesels last fall in the Jetta and earlier this year in the Touareg, they have been selling like hotcakes with June being its best month yet. Last month was the best sales month to date for the Sportwagen with 1,982 sales and a whopping 81% of those were equipped with the 2.0-liter TDI four-cylinder.

Among the 8,431 Jetta sedans sold in June, 40% were diesel powered. And while the Touareg followed most other SUVs with a 41% overall decline to only 330 units in June, 29% of those had the 3.0-liter V6 TDI engine. Rabbit sales were down 69% in June, but a redesigned Golf is arriving in September, including a TDI – and if fuel prices keep climbing through the summer, it could see a huge sales spike as well.

[Source: Volkswagen]

News Release Issued: July 1, 2009 1:39 PM EDT
Clean Diesel Fuels Volkswagen’s June Sales

Over 25 percent of sales were Clean Diesel TDI’s

HERNDON, Va., July 1 /PRNewswire/ — Volkswagen of America, Inc. today announced June 2009 sales of 19,027 units, representing an 18 percent decrease over June 2008. However, Volkswagen’s award winning clean diesels posted their best sales month since their re-launch with 5,072 units, representing an impressive 26 percent of total sales.

The Jetta SportWagen once again posted its best sales month ever with sales of 1,982 units. Clean diesel TDI’s accounted for 81 percent of SportWagen sales, 40 percent of Jetta sedan sales, and 29 percent of Touareg sales.

“Volkswagen of America is encouraged by the momentum of our clean diesel TDI sales,” said Mark Barnes, Chief Operating Officer, Volkswagen of America, Inc. “It appears that U.S. consumers are starting to realize the many benefits of today’s clean diesels–vehicles that attain more than 30 percent better fuel economy while emitting 25 percent less greenhouse gas emission, all without sacrificing driving dynamics,” Barnes added.

Volkswagen also announced today that they have been named a corporate leader in Strategic Visions Total Quality Index® (TQI). For 2009, Volkswagen has the most models across the segments that were measured than any other brand–New Beetle, Rabbit, Jetta, CC, and Tiguan were all recognized as TQI leaders in their respective segments.
[Source:Autoblog]

In a historic move that’s sure to irk their archrivals in Toyota City, Honda’s new Insight has become the first-ever hybrid vehicle to top the sales charts in Japan. By shifting some 10,481 units last month, the teardrop-shaped model became Nippon’s best-selling car in April, a feat no gas-electric car has managed previously. That’s according to the Japan Automobile Dealer’s Association, which tracks vehicle sales (in the interest of full disclosure, the group’s findings exclude 660cc “kei” cars).

Those 10,481 units vaulted the Insight from its slot as Japan’s 21st best-selling model in March, a major jump that’s likely down to production ramp-up and increased consumer awareness (Honda launched the car on February 2). The Insight, which starts at 1.89 million yen ($19,190) outpaced its brother, the Honda Fit/Jazz hatchback, while Toyota’s Vitz (Yaris) finished in third, Ironically, Toyota’s Prius rung up in 21st place, but the third-generation model isn’t expected to go on sale until May 18, and Toyota has already cut the iconic model’s base price in order to be more competitive with Honda’s upstart. Press release after the jump.

PRESS RELEASE:

LANDMARK ACHIEVEMENT FOR INSIGHT IN JAPAN
Insight is first hybrid to become Japan’s best-selling vehicle

Honda’s new Insight ranked as the entire industry’s best-selling new car in Japan for April 2009, with sales of 10,481 units. It is the first time that a hybrid model has topped the new car sales tables in Japan.

The Honda Fit (or Jazz as it is known in Europe) was Japan’s best-selling new car for calendar year 2008 and for the fiscal year ended March 31, 2009. Fit was also the industry’s best-selling car for March 2009, its fourth consecutive month at the top, until it was displaced by Insight to become the industry’s second best-selling car in April 2009. It is the first time Honda has occupied the industry’s top two best-selling car positions.

Since its introduction on February 6, 2009, the all-new Insight has been very well received by a wide range of customers due to its excellent environmental performance and affordable pricing.

Insight sales in Japan
Sales of Insight began February 6, 2009

Cumulative Sales
(since sales start)

Monthly ranking among new vehicle registrations in Japan

February 2009 Sales Result
4,906 units 10th

March 2009 Sales Result
4,088 units 21st

April 2009 Sales Result
10,481 units 1st

* excluding mini-vehicles – under 660cc

Source: Japan Automobile Dealers Association

# # #

[Source:Autoblog]

The well-publicized battle for hybrid sales supremacy between Honda and Toyota has taken yet another intriguing turn. According to Japan’s Nikkei newspaper, Toyota is saying that it expects to take 40,000 preorders in Japan for its new 2010 Prius hybrid ahead of its official rollout in May. For the sake of comparison, the Japanese automaker sold a total of 73,100 Prius hybrids in all of 2008.

More importantly, rival automaker Honda managed to sell about 18,000 copies of its latest Insight hybrid in its first month on sale. By all accounts, Honda was delighted to move that many Insights – the automaker had predicted that it would only sell about 5,000 units for the first month the hybrid was available in Japan.

A few months ago, Honda made a big splash by pricing the smaller, slightly less fuel efficient Insight a few million yen (or a few thousand dollars) below the starting price of the standard-setting Prius. In response, Toyota announced it would keep the previous generation Prius around for at least another year and dropped that model’s price to match the Insight.

But that wasn’t enough for Toyota – earlier this month, the automaker set the starting price for the new 2010 model at 2.05 million yen ($20,750), which is just about the same as the mid-level Insight. The next chapter: U.S. pricing for the 2010 Prius has yet to be announced. Let the games continue.

[Source: Reuters]

[Source:Autoblog]

Attacking a car with Swarovski crystals is starting to push the needle into the red on the Gauche-O-Meter during these days of bleak economic forecasts. Not only that, it comes off looking like someone’s got a serious addiction to the Bedazzler – cheap and tacky – regardless of how dear the faceted gemstones were. Crystallizing is just the ticket when you’re looking to generate conversation at an auto show, though, so Chevrolet asked the folks at Bling My Thing to descend on a Chevrolet Captiva with hundreds of tweezer-wielding lackeys and help the shiny bits get their vulgar on.

The Captiva is basically our Saturn Vue in slightly different form, and for the Bangkok Auto Show, the vehicle and its refractive customization generated plenty of enthusiasm. Bling My Thing will do this for you, dear customer, for a reportedly affordable sum. The Blinged Captiva is a showcase for the personalization available to customers of Bling My Thing, and it cost about $21,000 extra for all the fancy costume jewelery. Wonder what happens the first time you hit a carwash…

[Source:Autoblog]

According to The Detroit News, Avtovaz, Russia’s largest car maker and the home of Lada, is in line for government help. The Russian car industry is faring even more poorly than its counterpart in the U.S., with a 60% drop in sales being predicted. To assist Avtovaz with payments to creditors, a lifeline of more than 20 billion rubles is being discussed (upwards of $588 million USD), which would be close to Avtovaz’s total debt to suppliers and banks.

It is also being reported that Avtovaz is looking to sign an investment memorandum for 90 billion rubles ($2.7 billion USD) with a cartel of state-run banks. Compared to the sums being doled out in the U.S. that’s not a lada money (sorry, had to…), but if Avtovaz can get the agreements signed, it should be in better standing.

[Source:The Detroit News]