Why The Toyota Prius Faces Its Toughest Battle Yet

Illustration for article titled Why The Toyota Prius Faces Its Toughest Battle Yet

Good Morning! Welcome to The Morning Shift, your roundup of the auto news you crave, all in one place every weekday morning. Here are the important stories you need to know.


1st Gear: It’s Hard Out There For A Prius

A decade ago, the Toyota Prius was the darling of the automotive world, with politicians and pundits alike wondering why Detroit couldn’t come up with a viable competitor. The Prius seemed to be the future, and then something happened that nobody expected: gas got cheap again.

So now Toyota is back with an all-new Prius for 2016. It’s a big deal for them on several fronts, including the technology and platform it uses, but it comes at a time when public interest in hybrids is waning in favor of crossovers and trucks. From Reuters:

The car, unveiled in Las Vegas late on Tuesday, is the first model built under the Toyota New Global Architecture (TNGA) strategy, a new approach to development to improve its cars’ fuel efficiency, styling and other features, partly by using more common components.

The launch comes at a challenging time for Toyota. U.S. petrol prices are at their lowest for this time of year since 2004, pushing consumers to trade in hybrids and electric vehicles in favor of sports utility vehicles.

August Prius sales in the U.S. fell 24 percent from the same month a year earlier to 17,757 cars. Last year, U.S. Prius sales totaled 207,372 vehicles.

There’s another thing at play here too: as cars get more and more fuel efficient, buyers can get their big vehicles and decent gas mileage these days. Not Prius gas mileage, mind you, but in a world of cheap gas and 30 MPG crossovers, the hybrid’s appeal seems a bit more narrow.

2nd Gear: Just Don’t Expect Below Invoice Pricing On One

Toyota took steps to formally ban dealers from advertising cars at below-invoice prices, something rival Honda has done for years now. Here’s why, according to Automotive News:

As Automotive News reported last month, Toyota is following in the footsteps of Honda with its below-invoice advertising ban to help hold retail prices and prevent bait-and-switch tactics.

Those include enticing customers with extremely low prices, then pleading that the particular vehicle isn’t available when the customer comes to the store or the low price was based on a laundry list of undisclosed incentives for which the customer doesn’t qualify.


Dealers who violate the practice could face a warning followed by the loss of factory marketing incentives.

3rd Gear: More Power To Mary Barra

General Motors CEO Mary Barra was at the top of Fortune’s Most Powerful Women list, moving up from the number two slot she held last year. The magazine cited Barra’s leadership through the ignition switch recall crisis, which the public seems to have largely forgotten about. From The Detroit News:

The ignition-switch recall tied to 124 deaths has cost GM billions of dollars and it faces multiple lawsuits and investigations by the Department of Justice, Securities and Exchange Commission, 50 state attorneys general and Transport Canada.

“In recent months she has beaten back headwinds from weak international markets, as sales of expensive trucks and SUVs have soared,” Fortune said. “Barra was one of the few female CEO participants in the viral #ilooklikeanengineer Twitter campaign, which promoted women in tech.”


4th Gear: A Huracan Of Sales

Seems Lamborghini is about to have their best sales year ever. I wonder how much that had to do with cheap gas? For the people who buy them, probably not much. Mostly it’s the appeal of the new Huracan. Via Reuters:

Volkswagen’s Italian brand Lamborghini expects to hit a new sales record this year, benefiting from strong demand for its latest model Huracan, its chief executive said.

The supercar manufacturer last year increased deliveries 19 percent to a record 2,530 cars, a level it expects to eclipse already this month, CEO Stephan Winkelmann said in an interview.


5th Gear: NHTSA Could Force Takata’s Competitors To Step Up

As beleaguered supplier Takata struggles to make all the components needed to feed their unprecedentedly massive airbag recall, officials at the National Highway Traffic Safety Administration say they could somehow compel Takata’s competitors to to also supply automakers with the needed replacements.


One more from Reuters:

Rosekind told reporters that NHTSA would use the forum to “basically tell everybody how this is going to move forward.” The agency, which announced the October meeting on Wednesday, has conducted a lengthy series of meetings with the companies involved, including Takata and the 11 automakers it supplies.

“We need to make sure the priorities are clear, make sure the supplies are going to be available, make sure the quality assurance is taken care of. The remedy has to work,” Rosekind said.

Asked if NHTSA is planning to order other air bag inflator manufacturers to increase production to ensure replacement supplies, Rosekind said: “We’re in the process of figuring that out. If we need to, absolutely.”


It’s not clear yet how that would work, or more importantly, who would pay for it.

Reverse: Go Emily Post!


Neutral: How Does The Prius Succeed?

It’s always going to get love from the green crowd, but can it succeed as long as gas is so cheap?


Contact the author at patrick@jalopnik.com.



1st Gear :

We’re reaching the point of diminishing returns in fuel efficiency. Hybrids can ony get so much better, and people are slowly realizing it.

Caution : Tangent below

It will never happen, but the EPA would be wise to flip the efficiency rating on its head. It’s been said before, but buyers would be better served with a “gallons per 100 miles” rating rather than a “Miles per Gallon” rating. Lets call it GPH (Gallons per hectomile)

People like simple math, they are geared to make decisions quickly and topically, rather than slowly with depth of thought. Peope tend to equate an increase from 20MPG to 30MPG in a CUV with an increase from 50MPG to 60MPG in a compact. “Oh, I can go 10 more miles on a gallon of gas!”

The problem is that people pretty much have a fixed distance they need to go in most circumstances.

If they saw it as a shift from 5.0 GPH to 3.3 GPH, they would immediately see it’s much more impactful than a shift from 2.0 GPH to 1.7 GPH.

With that kind of presentation, people could more easily make more informed decisions about their overall consumption.