We already let you find out if buying a hybrid car is worth it and it got us thinking. Hybrid technology has been available for decades but it wasn’t until gas prices spiked in the mid 2000’s that they really grew in popularity. Despite becoming more popular on roadways, hybrids have yet to dominate American engine bays like the internal combustion engine. Why is that? Is it their asking price which can be 20% higher than a non-hybrid? Is it fluctuating gas prices?
We wanted to find out. Using monthly data from January 2013 through June 2014, we tracked the ‘Follows’ on hybrids and other vehicles received as a percentage of total follows on Mojo Motors. We used follows as the metric for activity since shoppers that follow cars want alerts when dealers drop prices.
It is clear there a relationship exists between higher gas prices and the desire to drive a more fuel-efficient vehicle. Between September and December 2013, gas prices fell by about 10%. At the same time, hybrid follows on MojoMotors.com for the Prius, C-Max, and Volt fell from about 1.57% to .54% of total vehicle follows. During the period from December 2013 through April 2014, gas prices rose by about 9% and hybrid vehicle follows rose from .54% to 1.1%.
To lean more about this pattern, we decided to compare interest in other small, fuel-efficient vehicles, like the Honda Civic. The results were unsurprisingly similar. As gas prices go down, people expressed less of an interest in fuel saving vehicles. The same 10% drop in gas prices from September to December 2013 resulted in a 2% drop in follows for used Civics.
We also looked at the followed pickup truck on Mojo, the Ford F150. One would think a gas guzzling truck would attract more shoppers as gas prices fall. What we found was interest in Ford F150’s does not seem to have a correlation with fluctuations in gasoline prices. Pickup trucks have more utility than say an SUV, hence why the SUV-craze died down and crossovers took over.
If we think back, we can all remember the 2008-era gas price roller coaster. People were worried that gas prices would soar to over $5.00 a gallon and gas sipping hybrids became more and more popular. Sales of inefficient SUV’s fell and people thought hybrids were the only way to go. Since then gas prices have stabilized, with fluctuations staying within $0.25, for the most part. This has resulted in people shying away from the initial extra cost of purchasing a hybrid.
As the internal combustion engine becomes more efficient, hybrid market share is beginning to fall. New hybrid vehicle sales make up about 3% of the new car market. In comparison, hybrids make up about 1.5% of the used car follows on Mojo, suggesting that used hybrids are even less popular than new models. F-150’s alone make up about 3 to 5% of vehicle follows, more then twice the amount of three of the most popular hybrid models.
This leads us to the conclusion that compact cars and hybrids are more prone to fluctuations in gasoline prices than pickup trucks. While a family of three can opt to buy a more efficient vehicle when gas becomes more expensive, a farmer can’t simply get a Prius. At the end of the day, he’s still gotta haul his horses.
Written by Johncarlo Pecorari