UPDATED: Canadians have spoken, hybrids really are a dumb buy

Honda Canada replied to the Civic Hybrid and Insight hullabalu: "There has been a rumour circulating this week about Honda Canada no longer selling the Honda Insight or Civic Hybrid. Please note that it is just that—a rumour. Honda Canada will listen to the voice of our customers and will bring the products they want. If there is market demand for Insight and Civic Hybrid, we will bring the appropriate supply. Honda dealers currently have more than 6 months supply of these models, so we will monitor demand and order more when demand is there. That said, Honda Canada is planning to offer both Insight and Civic Hybrid as 2011 model-year units, and we have no plans to discontinue either model."

So there you go. - JL

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It’s taken a few years. But it looks like Canadian new car buyers are coming to their senses about the lack of value in gasoline-electric hybrids."

Montreal’s LaPresse is reporting that Honda Canada will be dropping two-thirds of its hybrid lineup. Not that anyone will notice, but allegedly, the Civic Hybrid and the much-hyped Insight will be leaving showrooms, just as its new CR-Zed sports coupe arrives.

"Our dealers do not keep any of these models [Insight and Civic hybrid] in stock and the customer who wants to buy one should place an order and wait for the car be delivered to him," Nadia Mereb, Honda’s Québec media relations person told the Montreal newspaper.

Officially, there wasn’t a 2010 model year for the hybrid Civic. It’s lack of popularity caused Honda Canada to continue to sell leftover 2009 models. Of the over 30,000 Civics sold in Canada in the fist half of 2010, only about 600 were hybrids. The Insight—Honda’s half-hearted response to Toyota’s Prius—has been even more of an unmitigated disaster. Only about 750 Canadians have bought an Insight this year. A little off the projected 10,000-per-year numbers Honda Canada had hoped for, eh?

Of course, Honda isn’t the only one finding out that hybrids aren’t fooling all of the people, all of the time. I expect Toyota premium brand Lexus’ HS 250h will soon suffer the same as the just-canned Honda hybrids.

Originally priced in the $40,000 and $50,000 range, rare is the buyer that has bought into the HS’s—er—interesting value proposition. And the market has spoken.

Last weekend in the Wheels print section, Lexus Canada was advertising $7,000 in discounts and incentives on the HS 250h, bringing it’s base price down to $34,980. Hey, don’t worry. There's no need to ruch down to your local Lexus dealer. The old, “Hurry! They’re going fast!” tagline doesn’t apply here.

So, obviously, Canadians have wisened up to the questionable value proposition of hybrids. And, obviously, they’re too many hybrids for the market. So which hybrid do you think should be the next to walk the plank?

[Sources: Lexus Canada, La Presse]

Green is Good: Honda ditches diesels in favour of hybrids

So much for going its own way. A report has Japan’s Honda canceling plans to build a new minicar and diesel engine plant north of Tokyo. Apparently, the dreaded new fuel economy and tailpipe emissions regs, that will peak in 2016, have scared the Honda folks enough to go over to the Dark Side: hybrids.

Now as you may know, Honda’s never been too keen on this whole gasoline-electric fad. Sure. It brought out the original Insight over a decade ago. But it wasn’t a full hybrid (one that can run on battery juice alone.) While in the ensuing years, its “mild hybrid” system (found in Civics and today’s Insight and CR-Z) has proven Honda never really felt been fully on board with hyrbrids the way rival Toyota. Its cars more of a sop to the market as if to say, Yeah, we can do a hybrid too, even if we think they’re kind of silly.

Really, if Honda had its way, we’d all be driving around in hydrogen fuel-cell cars, like its FCX Clarity. But with no investment in infrastructure from cash-strapped government, that’s not going to happen anytime soon.

And now that Honda’s given up on making diesels (as confirmed by the canned 2.2-litre i-DTEC diesel clean-diesel Acura TSX we were supposed to driving, like now, pictured above in 2008) Honda will more-than-likely announce a new full hybrid system capable of going toe-to-toe with Toyota’s Synergy Drive for its mid-size cars, like the Accord, and Acura TL, among others.

With VW/Audi's success with derv drinkers, do you think Honda is making a mistake ditching diesels?

Can it really take on Toyota in the hybrid market starting so late?

[Source: Reuters]

Green is Good: Do drive-thrus need a 'Timmy Tax'?

You may have read last Saturday’s front page article in the Star about the GTA’s impending transit meltdown: “To avoid transit disaster, GTA needs road tolls and taxes now.”

The article describes a report advising that to raise $1 billion to $2 billion annually for transit improvements, new streams of revenue (like a regional gas tax, commercial parking tax levies, a regional sales tax, or charging drivers to enter the Toronto downtown core) are being looked at.

Now look, I’m no transportation expert. And all of those ideas may be needed. But there’s one obvious area of revenue that seems to have been overlooked: the ubiquitous drive-thru.

For the past few years, environmentalists have been trying to either ban or limit the development of drive-thrus. Municipalities in Ontario, British Columbia and Nova Scotia have proposed banning new drive-thrus, mainly because of the air-quality issues caused by millions of idling cars, but also the issue of traffic congestion caused by the long lineups of caffeine addicts.

But let’s stop pretending. In the real world, a complete drive-thru ban is impossible. And you can’t get rid of the existing ones.

However, using a drive-thru is all about convenience. So, like having someone pump your gas for you, or wash your car, let’s add a service charge or a premium to each drive-thru order: We’ll call it the Timmy Tax.

Think about this: a 50-cent surcharge to every drive-thru order, whether it’s a coffee shop, bank or dry cleaner. And the revenue (50 cents times  millions of users every day — you do the math!) would go toward all those transportation improvements the province so desperately needs.

To me, it’s a win-win situation.

If you don’t want to pay the Timmy Tax, simply park your car and walk into the shop.

Or if you still want to use the drive-thru, your money will go toward improving how we all get around.

Let me know: Is a 50-cent Timmy Tax enough to get you out of your car when you need your double-double?

Or do you think that no matter how much the premium is, our addiction to convenience won’t get us out of the drive-thru lineups?

Green is Good: Nissan’s Leaf EV not attracting young buyers

Here’s a good one: Instead of the young, hip buyers that you would think an electric-vehicle would attract—you know, the types of buyers who are more interested in spending time updating their Facebook account and plotting ways to get Mom and Dad to pay for their next iPhone app—Nissan is saying that the average age of its Leaf electric vehicle pre-order U.S. buyer to date is above 50, while more than one out of three are over the age of 60.

If you think this goes against all the marketing huff that EVs are for kids, get in line. Of course, a big reason for the Leaf’s aging owner group is its cost. I mean, it takes a lot of hours working at American Apparel to pay for the Leaf's $32,500 USD asking price.

So why does the car of the future appeal to people who don’t have much of one?

Is it guilt for all those 1970s land yachts and muscle cars Boomers bought in their salad days?

Or is the Leaf—like every othr EV coming down the pipe—simply out of the price range of its intended demographic?

[Sources: Nissan-Leaf]

Diesel-loving Canadians to get new 2011 Jetta TDI first

The next, new 2011 Volkswagen Jetta is going to be a big deal for the German automaker in North America. And it needs to be. Along with the new U.S.-made Passat-replacing-yet-to-be-named midsized sedan coming next year, the new Mexican-made Jetta is the first half of VW’s two-sedan attack to more than double its U.S. sales from last year to 450,000 cars.

Working towards an on sale date of the last week of September, Volkswagen Canada is giving us more and more info on the new Jetta, previewed by the New Compact Coupe concept from last year’s Detroit auto show (above.)

VW Canada’s Peter Viney confirmed with The Crank that to go head-to-head with the compact top-sellers like the existing Toyota Corolla, Honda Civic and Mazda3 and forthcoming Chevrolet Cruze and 2012 Ford Focus, the new Jetta is going to be bigger and offer more engine choice.

Don’t worry diesel fans, one of those mills will be the popular Jetta TDI diesel (TDI sales represented over one-quarter of all Canadian VW sales last month.) And while the U.S. market won’t get the Jetta TDI right away, Canadians will.

“This is a very important model to us. So we want to make sure Canadians get the TDI—along with the other new 2011 Jettas—right at launch,” said Viney.

Hmm…more room, more engine choice and more upscale styling…

Has VW done enough to get you out of your Corolla or Civic?

Green is Good: Tesla ties the knot with Toyota

I’ve read that one of the inspirations for Robert Downey’s characterization of his Iron Man role (the sequel now playing in a theatre near you) was high-tech wunderkind and Tesla founder Elon Musk. Some of the current Iron Man 2 was shot in Musk’s Space-X rocket labs (he’s a rocket scientist as well), and he also makes a brief cameo appearance.

Yet hearing that Musk has been able to cajole Toyota into buying $50 million worth of Tesla stock to “collaborate on the development and production of electric vehicles,” the keys to the Japanese automaker’s recently shuttered NUMMI California plant, and an additional $20 million from the bankrupt California state government to retrofit said plant for the production of Tesla’s forthcoming Model S luxury electric sedan and “possibly … include the production of more models”, maybe it’s the real life Musk, not the fictional Iron Man, that has all the super powers.

When Musk appeared in the front row of Mercedes-Benz’s Frankfurt show presser last September, snuggling up with 'Benz head Dr. Dieter Zetsche after the German automaker  had purchased a 10 per cent share of Tesla, the scuttle-butt suggested ‘Benz was going to be low-volume Tesla’s sugerdaddy: The big car company that would help Musk transform his quaint, low-volume company into a bigger player, or simply just buy Tesla outright for its EV know how.

We may never know why that relationship was never fully consummated. But Tesla’s new tie-up with the Japanese automaker seems like a one-sided victory for Musk.

First, Tesla's hand-made Roadster EV is a dead end. There are only so many rich geeks who need to one up their Ferrari-buying chums in the world. And slapping a bunch of cell-phone batteries into a Lotus Elise was never Musk’s long term dream.

No. Musk’s dream is to go mainstream. And he’s smart enough to know that his current cottage industry setup (that hand build’s the current Roadster) was not going to have the resources or know how to build a whole new car from scratch, as the Model S sedan will be. The bigger question here is why mammoth Toyota is jumping into bed with miniscule Tesla.

For all the tens of millions Toyota is spending on purchase incentives to keeps its new car sales from collapsing during its current recall crisis, $50 M is peanuts for what may be a potentially great bit of PR for Toyota.

Closing the NUMMI plant and sending home its workers was just a another bit of bad news it didn’t need.

The other reason may be Toyota’s struggling luxury hybrid strategy. A Model S sedan (with an anticipated price of  $49,900, including a U.S. federal tax credit) maybe an easier sell with a Tesla badge on it than as a Toyota or Lexus.

I’m not sure what Toyota’s escape plan is if this relationship goes sideways.

But at the very least, Musk will have Toyota’s money and a burgeoning acting career to fall back on.

Green is Good: Honda executive disses EVs

While one of his company's main rivals is betting the farm on electric-vehicles, Honda’s R&D boss over in Japan isn’t as confident that EVs are the driving panacea others are counting on.

“We lack confidence” in the electric-vehicle business, said Tomohiko Kawanabe, president of Honda’s research and development unit. “It’s questionable whether consumers will accept the annoyances of limited driving range and having to spend time charging them.”

Compare that to Nissan head Carlos Ghosn’s take on EVs. The Japanese auotmaker's Leaf EV goes on sale in Japan and the U.S. later this year. Ghosn speculates EVs will make up 10 per cent of the global car market within the next ten years.

BTW, Advanced Automotive Batteries, a consulting firm based in Oregon House, California, thinks EVs will amount to no more than 1 per cent of the global market by 2020,

Honda stopped selling EVs ten years. But its is planning on selling them again in the U.S., chiefly to help meet California emission rules.

“We are definitely conducting research on electric cars, but I can’t say I can wholeheartedly recommend them,” said Kawanabe said in a Bloomberg report. Instead, Honda is still pushing hydrogen-powered fuel-cell vehicles like its Clarity FCX.

So who do think is right?

Nissan and its enthusiasm for EVs?

Or Honda and its hydrogen car hopes?

[Source: Bloomberg]

Green is Good: Can “sports car” and “diesel” ever be in the same sentence?

INGOLSTADT, Germany - It’s dawn, June, 2006. I’m watching the sun come up over the Porsche Corners during the running of the 24 Heures du Mans. And I’m witnessing history. On the way to becoming the first ever diesel-engine race car to win the historic event, Audi’s R10 swooshes by in relative silence to its conventional fuel-powered competitors.

Flash forward four years later to Audi Ground Zero here in southern Germany. I’m  behind the wheel of the promise of the R10, the new Audi TT 2.0 TDI, one of the first sports cars in the world to be powered by a diesel engine.

As is typical, torque is high in the TT's diesel four: 258 lb-ft  available between 1,750 and 2,500 rpm. It’s fuel efficient: 5.3L/100 km on the EU-cycle, what Audi says is best in class. It’s certainly quick enough: 0-100 in only 7.5 seconds; top speed 226 km/h. And its becoming popular: since its market launch, the diesel’s share in TT sales has grown steadily and is now over 11 per cent.

While we can expect this latest TDI to eventually make it over here as an update to the existing engine offered in our A3, when asked if a diesel TT will ever be sold here, Audi Canada’s Cort Nielsen says never say never.

“At this time with our TDIs, we're at a 'bookend' in regards to our diesel strategy in Canada,” Nielsen told The Crank.

Audi just introduced diesels into its Q7 and A3. Long term, you can expect more diesels filtering into other Canadian Audis as models get updated. But it all comes back to demand. If more customers were knocking at Audi’s doors clamouring for a diesel TT, all the parts are in place to make it happen.

If Audi—or any other sports car maker—offered a similar diesel package of fuel efficiency AND performance, would you bite?

Or are diesels doomed to large SUVs and heavy-duty pickup trucks?

Green is Good: Is Toyota's luxury hybrid strategy a flop?

When Lexus launched its HS 250h last year, I was a bit befuddled. Why parent Toyota went to the trouble of stuffing the hybrid Prius’s Camry's drivetrain into the chassis of the European Toyota Avensis compact sedan (which less rear legroom than a Corolla), style it like a Lexus RX SUV, and price it like it was made of unobtanium, I never understood?

Costing between $39,900 and $48,750, the HS 250h has neither the style, room, comfort nor refinement of not only the existing $41,950 ES 350 gasoline model, but also the over $10,000 cheaper Prius.

Sure. The HS 250h may be what Toyota thinks is a new type of luxury car. It has the RX’s neat mouse-like centre console controller. And is rated at a combined 5.7L/100 km. But that alone doesn’t seem to be appealing enough to make an impression with new car buyers. In the all-important U.S. market—where hybrids have traditionally been most welcome outside of Japan—the HS 250h isn’t coming close to meeting Toyota’s sales expectations.

Through the end of April, Lexus sold only 11,228 examples since launching the HS 250h last August. In fact, only 4,529 units in 2010. Last month, only 1,076 units. Compare those numbers to Toyota’s initial HS sales goals of 20,000 to -30,000 examples per year. Or the Prius. It sold 12,555 units last month, and has sold 40,793 units since January.

And now it looks like Lexus is waving the white flag on the HS 250h.

“I think we underestimated the power of the Prius brand… And we overestimated what the market would look like based on gas prices. But if we can do over 1,000 units a month, 1,000-1,500 units a month, we feel really good about what we’re doing in the marketplace,” Lexus U.S. vice president Mark Templin told WardsAuto.

Do you think the HS 250h is merely ahead of its time? A victim of relatively low gas prices?

Or are customers smarter than what Lexus is giving them credit for?

[Source: Wards Auto]

New Nissan EV’s Canadian availability dependent on government incentives

If you haven’t heard, Nissan’s new Leaf electric vehicle is becoming a big deal. The five-passenger car will be the first fully electric car launched by a major automaker. It is designed to provide a 160 km range on a full charge. And it looks like people are ready to buy into its promise of zero emission driving.

The Japanese automaker said this week it is on track to book 25,000 U.S. Leaf orders by the end of the year for when it goes on sale in the U.S. in December.

In Canada, Nissan also announced this week that the Leaf would be going on sale in the “second half” of 2011.

Said Mark McDade, director of marketing with Nissan Canada in a release, “There has been a lot of interest from Canadians to learn more about electric vehicles and what the ownership experience would be like.” The automaker has launched a Web site if you are interested in more info.

All fine and dandy. But the question of how much the Leaf will cost in Canada, and how many will be available to consumers here is still a mystery.

In the U.S., the Leaf is priced at $32,780 U.S.—not including federal tax credits of $7,500. In fact, Californians will get additional EV credits to drop the price of a Leaf to $20,280.

Nissan Canada spokesperson, Didier Marsaud, told The Crank that Canadian Leaf pricing and availability will depend if Canadian governments—either at the federal or provincial level—step up with incentives. Less discounts will cause less demand. And less demand will force Nissan to allocate initial Leaf production to other markets that are making EV ownership more affordable.

In Quebec, you can get up to $8,000 off the purchase. But in Ontario, we’re still waiting to find out what—if any—EV purchase incentives will be available.

Last July, Ontario Premier Dalton McGuinty announced rebates of between $4,000 and $10,000 for plug-in hybrid and battery EVs purchased after July 1, 2010. But since then, nothing further has been heard to indicate these rebates will become reality.

“At this point, we don’t know what they’re intention is,” said Marsaud.

So, a couple of questions. Are you ready to pay the full price for the Leaf and other EVs, if governments don’t come through with taxpayer subsidies?

Or are you quite happy to pay the full ticket for EVs like the Leaf to enjoy its ability to use no fossil fuels?