In China, Hybrids Are Tough Sell - WSJ.com
Monday, April 21st, 2008In China, Hybrids Are Tough Sell - WSJ.com By JOHN MURPHY and GORDON FAIRCLOUGHBEIJING — At the Beijing auto show this week, companies are showing off their latest environmentally friendly technologies, including hybrid engines, electric cars and fuel-cell vehicles.
But there is little chance such innovations will help reduce the environmental fallout of the car-buying boom sweeping across China and other emerging markets like Russia and India soon.
Toyota has had disappointing sales of the Prius hybrid in China, where duties raise the price. On Sunday, it showed off its Hybrid at the Auto China 2008 auto show in Beijing.
The problem is cost. The high-tech green solutions touted by auto makers are proving to be too expensive and often impractical in the developing world, where consumers are just beginning to afford the combustion engine. For instance, in China, where passenger-car sales soared 21% to more than 5.2 million vehicles last year, some consumers are environmentally conscious, but they also care about price.
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Toyota Motor Corp.’s competitors have long complained that the Japanese’s automaker’s groundbreaking Prius hybrid car has not been profitable. Several years ago, before General Motors Corp. got religion on hybrids, GM Vice Chairman Bob Lutz dismissed the Prius as a marketing expense designed to place a “green” halo over Toyota. But Toyota has maintained the Prius is profitable.