Electric vehicle sales lag as hybrid cars becoming top-sellers in California

With the price of gas spiking again, it would make sense that sales of electric vehicles would also be on the rise.  But that's not the case. A new survey reveals that EV sales have declined significantly from a year ago, while consumers are increasingly turning to gas-powered hybrid vehicles.

Toyota of Marin in San Rafael is a good place to go to see the latest trends in fuel-efficient cars. No longer is the Prius their only hybrid vehicle. Sales Manager Kiah Kopulsky said nearly all the cars Toyota makes these days are hybrid.

"The dealer group, Toyota or Honda or whatever, is just going to whatever people want. It's supply and demand," he said.

In hybrid vehicles, the gas engine charges a battery that powers an electric motor at lower speeds. It results in significantly higher gas mileage, which is attractive in times like these with prices approaching six dollars per gallon again.

"As long as they can get great gas mileage, they can kind of make the sense that it's ok to have gas versus electric," Kiah said. "You know, it's ok to have hybrid versus electric, because getting 40 to 50 miles to the gallon, I mean, how do you beat that, right? It's pretty good."

The data seems to reflect that. A recent report from the California New Car Dealers Association reveals that hybrid car sales have overtaken purely electric vehicles for the first time since 2020, with EV sales declining 25% from the start of last year. In fact, hybrid vehicles now enjoy their largest share of the California market on record. Association president Brian Maas said it's all about the economics.

"The average price of an EV is over $50,000," he said. "So, a consumer looking for a cheaper option is probably going to look at a hybrid if they're concerned about fuel economy, until we get EV's in the $30-40,000 price range."

That's where the state is stepping in. They just announced the MyFirstEV rebate program, meant to help replace the cancelled federal EV tax credit. Under the plan, first time EV buyers would get $3,400 on any new electric car costing less than $50,000, with half that money coming from 13 participating car manufacturers. Buying a used EV would qualify for half that amount. John Higham, with the Electric Vehicle Association, said car companies may be responding to consumer demand with hybrids, but they're not ignoring the growth of EV's in other countries.

"I think that it keeps U.S. manufacturers in the game a little bit, with respect to what's going on in the rest of the world," he said. "And I think manufacturers see the importance, and they're putting their money on the table."

Details of the new rebate program will be released next month, including its launch date. With matching contributions from the state and car manufacturers, the program has $270 million in total funding. But back at the car lot, Kiah said his customers see hybrid vehicles as the best alternative right now.

"Until the gas hits ten dollars, I'm sure people are going to be ok with getting 50 miles to the gallon, or 40 miles to the gallon," he said. "When all of our lives we've been getting, I don't know, how much do you get, 20? And you're happy at 23 or 24, right? You're satisfied because that's the norm? Not anymore."

It appears that that those with strong environmental convictions about EV's have probably already purchased one. That just leaves those who are motivated by cost - whether it be the cost at the dealership, or the cost at the pump.