Hybrid Vehicles Rise To The Top Of The Car Market

For many years people have often owned or driven cars that are not only to help for transportation purposes but are also there for improving the overall mobility experience.

In recent past times, people also drove cars to show off or flaunt their status symbol or just for the sake of casual and fun joy rides.

But those good times are turning into rare dreams now. For every motorist, it’s really getting harder and harder each day. Almost everybody, may it be a student or a retired senior person, is troubled and concerned about the zooming up gasoline or oil prices.

Given the constantly rising increases in gasoline prices, which come almost on a weekly basis, there is no wonder why people are forced to limit the use of car to a basic necessity.

Hybrid vehicles

During the start of the new millennium, giant car manufacturers had heralded great news about the development of modern cars that would significantly cut oil consumption.

Japanese car makers Toyota and Honda started with their research on alternative fuel efficient transmission systems and soon became the pioneers in this particular endeavor. Their United States and German counterparts followed the trend soon.

That was the emergence of hybrid vehicles in the now sluggish global car industry.

But what exactly are hybrid vehicles? Literally, the word ‘hybrid’ means a crossover or integration of two systems or components. Applying this term for vehicles, it means a combination of two types of cars, the gasoline powered cars and the electric powered cars.

Before understanding the hybrids further, let’s get familiarized with the two mentioned car types.

The gas-powered and electric-powered vehicles

The gas-powered cars are the predecessor of all the other types of cars that came after it. The first invented car and all the other cars and modifications that follow it until the end of the 20th century are all gas-powered cars.

Gas powered cars are, you guessed it right, run by gasoline or oil. These cars have made oil exported fro the Middle East and other nations valued like gold, because of its volatile pricing.

Many years of research and development has enabled the manufacturers to add key improvements in the newer models of the gas-powered cars. Some of them are truly superior over the others. However, their owners and users have always been complaining about their increasing bills for oil consumption.

At the same time, the environmentalists are complaining about such cars’ air pollution. They are raising strong concerns over the combustion process that produces bi-products that are harmful to nature.

The first attempt of car makers to address the increasingly rising and agitating concerns about higher oil prices and depleting ozone layer in the atmosphere was that of electric cars.

But alas, on practical grounds, those efforts were proven futile and non-feasible. Electric powered cars were turned down as impractical because their mileage and speed would not match the capacity of the gas-powered vehicles by a great margin.

A powerful combination

So, if the gas-powered vehicles were too expensive and pollution causing to maintain but really fast and reliable, and if the electric cars are not fast and reliable, but significantly cut costs of oil expenses and reduce pollution, why not combine both?

Smart integration and the ‘meeting half way’ option for the electric and gas powered cars paved the way for the rise of the hybrid vehicles.

Hybrid vehicle system consists of both gas powered engine and battery set powered motor, and a fine balance of the two power sources to manage the transmission. It truly combines the strength of both car types and addresses the concerns arising from each car types too.

However, many experts and car fanatics are still disappointed with the hybrid car’s inability to reduce oil bills as massively and tremendously as anticipated by the public before its introduction to the market.

A big concern is about the purchase price for hybrid vehicles. It’s still way, way higher. Also, due to their complex designs, many people fear that their maintenance costs will be significantly more than the gas powered cars.

It has been just a few years since the emergence of hybrid vehicles. In the future, very soon, as the production cost would go down, the prices of hybrid cars would certainly be dragged down to an affordable level.

Toyota Believes in the Future of Its Hybrid Vehicles

By 2020 Toyota expects hybrid vehicles to be 20% of global car market

Takeshi Uchiyamada, a top engineer for car make Toyota, made some interesting predictions this week. He expects that hybrid vehicles, including extended-range plug-in hybrids, will become 20% of all global car sales by 2020.

You might be wondering what these predictions are based on. Well, the Toyota’s executive vice president overseeing R&D and engineering pointed out that hybrid car sales are already 20% of annual vehicle sales in Japan, but that most of the developing world is at or below 10 % in hybrid sales. But obviously he believes that these markets will develop in the same way the Japanese market has.

What will Toyota’s market share in hybrid vehicle sales be?

What car manufacturer Toyota’s market share of the hybrid car market pie would be, is something the Toyota engineer refused to expand on though. Up until a shirt while ago, Toyota’s market share in hybrid vehicle sales in the United States had been as high as 80%. However, it has slipped a little bit since new competitors have entered the market.

Toyota does plan to continue its successful run with its high hybrid car sales and hopes to further expand its hybrid presence in all vehicle markets, including in the United States with the Prius V, Prius C and Prius Plug-In by the middle of next year.

According to Takeshi Uchiyamada, the automotive company also hopes to double the U.S. sales volume of the Toyota Camry to about 50,000 units in 2012. On the European car market, a hybrid version of the redesigned Yaris will be released.

Toyota production management in relation to hybrid car sales growth?

For the car manufacturer to be able to meet the expected rise in demand, the production process needs to be adapted. That is why car maker Toyota is looking into using suppliers outside Japan to build hybrid components. After the March earthquake in Japan, it became clear to the company that it is too dangerous to rely on a single source for key components.

Toyota engineer’s predicts grim future for electric vehicles

Up until now, Toyota has concentrated on building hybrid cars and plug-in hybrids to live up to the increasing demand for ‘green vehicles’. Electric cars have not been a priority for the car brand. So it doesn’t come as much of a surprise that Uchiyamada doesn’t predict a positive future for electric vehicles.

He expects that electric vehicles will fall short of their hype. “Based on the current data, the targets announced by other players show they are not on track,” Uchiyamada said. “Compared to the target, it’s pretty disappointing for them.”

Relevant Details on the Obama Administration’s Stimulus Package Tax Credit For Hybrid Vehicles

President Obama’s stimulus bill, which is also referred to as the American Recovery and Reinvestment Act of 2009, enables us to claim certain benefits for hybrid vehicles. More specifically, Hybrid vehicles are offered a tax credit as per the stimulus package. All vehicles purchased from the year 2006 are eligible for the hybrid vehicle tax credit. The following includes some of the details of of the stimulus package.

Note that the best person to guide you effectively in this aspect is your tax consultant. Choose a good consultant and check out all possible details before filing your returns. You can also go online and read reviews, analysis and reports on the stimulus tax credit for hybrid vehicles to find more details.

The credit amount depends on multiple factors:

First, you must be the owner of extended range electric vehicles or plug in hybrids. Your hybrid model has drive trains which are powered by both rechargeable batteries and internal combustion engine.

Second, your eligibility depends on the vehicle model and the state where it was purchased. This scheme is also known as the Alternative Motor Vehicle Credit and all vehicles purchased after 1st January 2006 are eligible for this.

Third, if your hybrid vehicle was on road in the year 2008 and you are a taxpayer, then you can certainly claim credit. However, according to the stimulus package, credit will be given only to those who are the actual owners of the hybrid vehicles and not for those who have purchased the vehicle on a resale in the year 2008.

Fourth, the vehicle size and battery pack also plays a role in determining your eligibility for tax credit in the plug-in hybrid range. If you own a Chevy Volt, you should get a credit somewhere around $7,500 if you qualify. If you own a plug-in truck you may even be eligible for credit that can be as high as $15,000.

Finally, if your vehicle is extremely fuel efficient, you may even be eligible for credit worth $3,000.

In addition, there are other factors to consider:

  • Credits will be given to new hybrid vehicles (those models which came out last year). The limit for a manufacturer is 60,000 vehicles. After this number of vehicles is sold, the available credit starts coming down until it is completely eliminated. Vehicle owners must wait for the manufacturer to reach the sales limit and file before the end of third month following the quarter.
  • The manufacturing company is not an eligibility criterion and as of now around 500,000 vehicles are eligible for tax credits.

It is also worth noting that there are other benefits offered in this package, including a $2 billion grant for manufacturing and development in the battery sector. A tax paying buyer who goes in for vehicle conversion will be eligible for up to 10% of the conversion price or a maximum of $4,000.

In conclusion, whether you own a hybrid vehicle, or if you are planning on buying a new hybrid car, you may be pleasantly surprised to find a deduction in your local sales tax and auto loans.