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Market Insight: More buyers looking at hybrids

In demand: Volvo will launch a plug-in hybrid version of its XC90 SUV later this year, which could come as good news to fans of the Swedish brand.

Roy Morgan research shows more new-car intenders investigating benefits of hybrids

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Market Insight logo9 Feb 2015

By TIM NICHOLSON

AUSTRALIAN new-car buyers were more likely to consider a hybrid-powered model in the past 12 months than they were in 2013, according to Roy Morgan Research, as sales of green-powered vehicles remain static.

Notwithstanding the recent fall in fuel prices, figures released by the market research firm reveal that the number of Australian drivers that say they would “seriously consider” buying a hybrid vehicle has risen for the first time since 2008.

According to the survey, about 46 per cent of the 2,258,000 Australians planning to buy a new car within the next four years would seriously consider buying a hybrid vehicle.

Roy Morgan says this is an increase of 21,000 people when compared with the 43.6 per cent of respondents that said they would like a electrified vehicle the previous year.

The survey period was October 2013 to September 2014 and respondents were made up of Australians over the age of 14 years who intended to buy a new vehicle in the next four years.

Out of the brands with the highest proportion of “hybrid consideration”, Volvo was ahead of the pack with 64.2 per cent, with the average being 45.9 per cent.

The Swedish car-maker does not have a hybridised model in its line-up but that will change later this year when it introduces a plug-in hybrid version of its new-generation XC90 SUV.

Notably, buyers in the market for a Kia were the second most likely to purchase a hybrid with 60.3 per cent, while hybrid technology leader Lexus was unsurprisingly high up in third.

Honda was in fourth with 53.1 per cent, but since the survey was conducted, the Japanese car-maker has discontinued its key hybrid models including the Civic sedan, the CR-Z sportscar and the previous-generation Jazz, while confirming that the Accord Hybrid will be added to the line-up later this year.

At the other end of the scale, intenders looking at Holden, Jeep and Mercedes-Benz models were the least likely to consider a hybrid, with Mercedes the lowest on 28.7 per cent.

The Jeep result is expected and for Holden it reflects the lack of demand for its Volt plug-in hybrid.

Mercedes, however, is already selling hybrid vehicles and looking to increase its offerings – particularly with new hi-tech plug-in hybrid variants – over the next 12 to 24 months.

Mercedes-Benz Australia/Pacific senior manager of public relations, product and corporate communications David McCarthy told GoAuto that the car-maker’s own internal data is showing that there is demand for hybrids among customers.

“The C300, E300 and S300 are meeting our projections, the customers who have bought them, in nearly every case, came in to buy a hybrid,” he said.

Mr McCarthy said the company was not concerned about the survey results and confirmed that the S500 and C350 Plug-In Hybrid variants are still “both under active consideration for our market”.

He added that in Australia’s case, there may not be room for both conventional ‘mild’ and plug-in hybrid alternatives, but that would be dependent on the outcome of a business case.

“It’s hard to make a business case for both mild and plug-in hybrids together, but provided we can make the business case workable and robust we will do both.”

Potential BMW buyers were also less interested in considering a hybrid car, with the German brand coming in under the average. The car-maker has just launched its i3 all-electric and a plug-in hybrid hatch and its i8 plug-in sportscar is trickling into selected showrooms now.

It is also likely to introduce a plug-in version of the X5, and it continues to offer mild hybrid versions of the 3, 5 and 7 Series.

While the likelihood of potential buyers considering a hybrid car has increased, sales of the electrified models in Australia have not shifted in the past two years, with 11,950 sold in 2014 – just one single unit more than the previous year.

Sales of vehicles with the VFACTS classification of electric, however, have increased substantially, with 292 sold in 2013 compared with 1130 last year.

VFACTS defines ‘electric’ as vehicles that have electric power as the primary fuel type and petrol or diesel as the secondary fuel type, which means plug-in hybrid models such as the Mitsubishi Outlander PHEV, Holden Volt and BMW i3 REX are all classed as electric vehicles.

Models that have petrol, or diesel as their primary fuel type and electric as secondary are considered ‘hybrid’ vehicles, according to the Federal Chamber of Automotive Industries that collects and distributes VFACTS data. This includes vehicles such as the Toyota Camry Hybrid, Nissan Pathfinder Hybrid and the Mercedes-Benz C300 BlueTEC Hybrid.

Hybrid sales slipped by 29.7 per cent among private buyers in the passenger segment last year, but business and fleet passenger purchases rose by 10 per cent. While the numbers were much lower, hybrid-powered SUVs grew last year by 70.3 per cent among private buyers and 120 per cent to businesses.

Some hybrid variants are faring better than others, with 24 per cent, or 5290 units of Toyota’s locally built Camry sales last year (22,044) going to the petrol-electric version, up from 22 per cent in 2013.

Sales of Toyota’s most famous hybrid - the Prius and its family of small cars - are sliding, which could be due to the age of each of the models, as well as the proliferation of hybrid-powered variants of other cars that are seen as making less of a statement than its original eco hero.

Prius sales dropped 12.3 per cent last year to 487 units, the Prius V seven-seat MPV slid by 23.4 per cent to 722 and the smaller Prius C light hatch was down 29.2 per cent to 1654.

Mitsubishi sold 9677 Outlander SUVs last year, and the PHEV, which went on sale in April, has sold 873 units to the end of January this year.

Nissan's Pathfinder Hybrid, which only launched in September, is making up 10 per cent of the seven-seater’s overall sales so far.

Infiniti sold 197 examples of its Q50 mid-sizer last year, and out of that total, 28 per cent or 55 units were hybrid.

Despite the lack of government incentives and charging infrastructure in Australia, more car-makers are planning to introduce plug-in hybrids to their range in the coming years.

Audi will launch its first PHEV next month with the arrival of the A3 e-tron, ahead of the Q7 e-tron that should lob next year, Volvo’s plug-in XC90 is coming and Porsche’s electrified Cayenne S E-Hybrid will roll into showrooms next month.

This does not mean that all manufacturers are turning away from mild hybrid systems, with Land Rover launching hybrid versions of the Range Rover and Range Rover Sport in April, while Kia is seriously considering a hybridised version of the next-generation Optima, due later this year.

Toyota and Lexus continue to reaffirm their commitment to the technology and do not have any PHEVs in the pipeline, while BMW says it is still committed to its ActiveHybrid variants, despite relatively low take-up.

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