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Toyota Bets Big on Plug-in Hybrids

When the green revolution landed on the auto industry, it was Toyota who led the way. It’s Prius literally became the symbol of the Green Machine movement, both by those who supported the movement and those who denigrated it. As the most popular hybrid car in the world, the Prius has officially arrived.

In the early going, it wasn’t that way. Hybrids were more expensive, and the smaller frames were not popular in an American market dominated by massive SUVs. But, eventually, hybrid vehicles caught on, not only the Prius but also hybrid versions of Toyota’s famous Camry sedan. Then, other automakers caught up with their own hybrid vehicles.

The industry progressed as cars began to depend more on electricity and less on gasoline. Tesla jumped to the head of the pack with the first line of fully-electric cars that were also “performance” and “cool.” Meanwhile, Toyota continued to push the limits with its plug-in hybrid line.

All this while environmental awareness was catching up with the culture. More people were learning about climate change and were opting for more fuel-efficient vehicles. As alternative energies became cheaper, even low fuel prices could not stop the march toward more fuel efficient cars.

Technology got better, as it does, and the prices of hybrid cars have dropped, which increased demand. Toyota said it expects to sell up to 60,000 of the second generation Prius models annually worldwide. Half of those sales will be in Japan, so it’s obvious the company has some ground to make up here in the States.

There are a lot of factors. While the Camry and the Honda Accord both remain very popular sellers in the U.S., American-made vehicles are still very big sellers. Plus, despite the increased sales in electric or hybrid cars, Americans still love their trucks and SUVs. That may change. The next generation of Prius models is expected to get up to 25 miles on a charge before they switch over to gasoline. That means most work commutes could be done on a single charge.

Those specs should make the Prius and other latest-generation hybrids more attractive to Americans, but there’s still a major cultural hill to climb. Toyota is definitely aware of this. Looking at the evolution of their mainline truck, the Tundra. Toyota spent years trying to market a smaller “midsize” truck before beefing up the Tundra for the American market. The truck grew wider and stronger, and now it competes directly with the best-selling Silverado, Ram, and F-150.

But that doesn’t mean there isn’t a ready market for the next-gen Prius. Toyota is betting big, but they have more than even odds of success … if they build properly and control their message well.

William Doonan is a tax law and legal expert.




This post first appeared on William Doonan | Tax Law Attorney, please read the originial post: here

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Toyota Bets Big on Plug-in Hybrids

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