Hybrid Sales Surge in US as Gas Tops $4, With Asian Brands Capturing the Demand
Higher gasoline prices are pushing American drivers toward hybrids, and Hyundai, Kia, Toyota and Honda are cashing in while Detroit's automakers have few to offer.
Hybrid vehicles are suddenly in high demand in the United States. With gasoline above $4 a gallon, American buyers are looking for fuel-efficient cars, and Korean and Japanese automakers are the ones with hybrids on the lot.
What the sales numbers show
According to CNN, Hyundai said hybrid sales climbed 39% in the third quarter, while Kia's more than doubled, up 152%. Japanese brands also posted strong results, with Toyota sales up 29% and Honda up 21%.
Gas prices have risen sharply since the start of the war with Iran in late February, CNN reported. Buyers who had few qualms about large, fuel-hungry vehicles earlier in the year are now paying more attention to mileage.
The boost nearly let the Korean automakers pass Ford in US sales for the first time. Hyundai and Kia together sold 506,200 vehicles, up 5.4% from a year earlier. Ford, the third-largest American automaker by volume, sold 509,764, down 6.6%. Most analysts count Hyundai and Kia together because Hyundai owns a significant stake in Kia.
Nikkei Asia separately reported that Hyundai Motor Group overtook Honda for the first time in the US hybrid market in the first half of the year, helped by sustained high gas prices.
Why Detroit is behind
Ford, General Motors and Stellantis sell few hybrids. Ford has one hybrid midsize pickup, the Maverick, and dropped its hybrid Escape SUV. Escape sales of all versions fell 85% in the quarter as dealer supply ran down. GM's only hybrid is a version of the Corvette sports car. Stellantis said in January it would phase out its plug-in hybrids in North America.
For decades, the Big Three have cut smaller, fuel-efficient cars in favor of higher-margin SUVs and trucks. Cox Automotive said US companies recorded a record-low share of new-car sales in the quarter, and senior economist Charlie Chesbrough said the trend "seems likely to continue" given Detroit's limited hybrid options.
Ford and GM both plan more hybrids in the coming years, but CNN noted that changing course takes time.
Hybrids versus EVs
Pure electric vehicle sales have fallen sharply over the past year. EVs cost more than gas cars, and a $7,500 federal tax credit for EV buyers ended last September. Tesla, the largest US EV maker, reported third-quarter sales down 2% from a year ago.
Hybrids, which pair a gas engine with an electric motor, are much cheaper. Ivan Drury of Edmunds said consumers will find a hybrid meets their needs "far more conveniently" and at a lower price than an EV.
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What it means for you
If you are shopping for a hybrid, expect the widest choice from Asian brands such as Toyota, Honda, Hyundai and Kia, since domestic makers offer few models. Ford's Maverick is the main American hybrid option mentioned in the sources. The figures here are US sales, so check local dealers for availability. Ford and GM have promised more hybrids in coming years, but no dates were given.
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