Ever since gasoline prices tumbled from their highs of last year, sales of hybrids have tumbled along with them. And while most automakers are shunning diesel engines right now, Volkswagen turned in sales numbers in June that should make everybody sit up and pay attention.
So, are we going to see a battle royale between hybrids and diesels? It's too early to tell, but here's what's going on in the market at this snapshot in time.
John McElroy is host of the TV program "Autoline Detroit" and daily web video "Autoline Daily". Every week he brings his unique insights as an auto industry insider to Autoblog readers.
The number of hybrids in the market keeps growing and growing, but there are more losers than winners. There are now 23 different models of hybrids in the American market. But most of them are turkeys that are selling very poorly.
For example, Lexus only sold 31 units of the LS hybrid last month. Chevrolet only sold 84 units of the Silverado two-mode hybrid. Nissan sold 666 units of its Altima hybrid. These are ridiculously low numbers.
And I'm not just cherry picking the worst examples. The hybrid market really isn't going anywhere. Hybrids still only account for 3% of all car sales and the Prius still accounts for half of them. Take the Prius out, and hybrid sales are truly inconsequential.
Meanwhile, almost every automaker has postponed plans to bring out diesel engines. GM, Ford, Toyota, Honda and Nissan all have smaller displacement diesels that are ready to go, but have been put on the back burner for now.
Mercedes, BMW, Audi and VW are the only ones really pushing diesels in the American market, and as the June sales report shows, VW has quite a story to tell.
Last month, diesels accounted for 80 percent of Jetta Sportwagen sales, 40 percent of Jetta Sedan sales, and nearly 30 percent of Touareg sales. Overall, diesels accounted for over a quarter of VW sales last month.
That was for only one month of sales and one month does not a sales trend make. But those numbers have to be mighty encouraging to the people who are pushing for diesels.
Of course, diesel prices have fallen along with gas prices. And both those prices will definitely fluctuate in the future. But this shows how fuel prices have an extraordinary effect on the type of technology that will sell in the showrooms. Indeed, it shows the trouble automakers will have meeting fuel economy standards since they are at the mercy of a determining factor that is completely out of their control.
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