BP’s Oil and Gas Production Down 2.5% Quarter-to-Quarter; Fourth Straight Decline
Free Fuel Incentives Hop Across the Atlantic

US Sales of Hybrids Stay Strong in June 2006, Up 20% from 2005

Click to enlarge.

Hybrids in the US had their second-strongest sales month of the year and third-strongest month ever, posting a total of 23,048 units, an increase of 20% from June 2005. May 2006 remains the peak month, with 23,554 units sold.

Total light-duty vehicle sales in the US declined 10.5% to 1.5 million units in June 2006 from 1.68 million units in June 2005, according to Autodata. Hybrids represented 1.54% of all US light duty vehicles sold in June 2006, up from 1.15% in June 2005.

Click to enlarge.

Toyota again led the way with ongoing strong sales of the Prius— 9,696 units, up slightly from June 2005 and its best performance of the year so far. The new Camry Hybrid followed as the second-best selling hybrid in the US, posting 4,268 units. In only its second full month of sales, the Camry Hybrid now represents 10.3% of the total brand sales.

The Highlander Hybrid stayed in its ongoing band of performance, with 2,705 units sold, and 25.9% of total brand sales. The Rx 400h, however, had its lowest sales month ever, posting only 1,190 units, a drop of 54% from June 2005 and representing only 12.3% of brand sales. The luxury GS450h racked up 231 units, accounting for 55% of the combined GS 430/450h brand sales.

Ford posted a combined 1,884 units of the Escape and Mariner hybrids, up 67% from June 2005 and representing 11.6% of brand sales.

Honda had a strong month for the Civic Hybrid, with 2,601 units—1 40% increase from June 2005, and representing 9.9% of brand sales. The Accord Hybrid continues to flounder, however, posting only 396 units—its second-lowest results of the year, and off 63% form June 2005. The hybrid represented 1.2% of Accord brand sales.

Honda’s soon to be phased-out Insight posted 77 units in June, up 12% from the year before.

Hybrid_sales_jun063 Hybrid_sales_jun064
Hybrid car sales. Hybrid SUV sales.
Hybrid sales as a component of total model sales.


Rafael Seidl

Year-on-year sales figures are valuable for sales managers but for the purposes of this forum, a 12-month rolling average would perhaps be more informative.

Using ye olde mk 1 eyeball, it looks like US hybrid sales are currently averaging ~18,000 a month total, or ~210,000 units annually. This represents 1-1.5% of total vehicle sales. It may be a hot segment but let's not lose sight of the fact that at current mark-ups, it's still very much a niche. Diesels make up ~50% of new vehicle registrations in the EU, which adds up to rather more fuel saved in total.

The niche character of hybrids is underlined by the fact that even for those models that are available with either conventional or hybrid drivetrains (e.g Camry), hybrids only account for ~10% of sales. The Prius is an exception, and popular in part because it is instantly recognized as a hybrid, which tends to reflect well on the owner (eco bragging rights).

For hybrids to become mainstream in terms of actual sales, as opposed to column inches in trade rags, the economics have toi change. Either the price of batteries has to come down substantially, or the price of fuel has to go up substantially.

Personally, I'd prefer not to cross my fingers hoping for cheaper batteries. Higher fuel taxes and lower income taxes would ensure fuel efficient technologies (hybridization is but one of many) make more economic sense and really do become ubiquitous in the LDV fleet over the next decade. The environmental and national energy security gains from 10-20% improvement across the board would be much more significant than a select few vehicles with superlative fuel economy (cp. PHEVs).


Wow, Rafeal the tax hound at it agian. Growth of 20% ain't too shabby considering the US makers are down about 6%. Premiums can be cut by the Japanees and drive up sales but they prob can't get a whole lot more batteries right now anyway. Hmm wanna venture a guess on a good investment right now in the get off oil segment?


I would vote for a carbon tax any day. Unfortunately I realize that my attitude is held only by a minority, especially here in the taxaphobic US...

Mark R. W. Jr.

Instead of taxing, promote hybrids, develop alt fuels, and raise CAFE standards.

That said, there has been talk about lithium ion batteries replacing the Nimh batteries currently used by hybrids. Are the lithium ions any cheaper?

allen zheng

Commercial hydraulic hubrids will send this chart much higher during 2007-2009 timeframe.

Rafael Seidl

Mark -

oil prices will come down again as soon as supply once again outstrips demand. This has always happened in the past, as producers ramp up capacity and one major OECD economy or another hits the skids. Perhaps this time will be different, or it might just take longer for us to get there.

In any case, when oil prices do drop, you will see why tax policy is a neccessary part of sustaining demand for the alternative technologies you are advocating. In the 70s and early 80s, engineers were working on all kinds of fuel economy projects. They were all quickly shelved once oil became cheap again. Consumers went back to buying ever-bigger cars and SUVs. If you want to break the "addiction to oil", you've got to make sure the dope is and stays expensive. Ain't no other way.



There's strong evidence that worldwide oil production will peak sometime in the next ten years, if it hasn't already. Therefore I doubt oil prices will ever come down again.

We're out of $20 oil. Possibly even $40 oil.

Even if the producers can expand their capacity, we have swiftly growing economies in Asia that will likely keep prices high. We didn't have that the last couple times oil prices dropped again.

Ergo, fuel taxes will not be needed.


Oil is currently about $1.27 per gallon based upon $70 per barrel oil. If oil doubled to $140 per barrel, that would only increase gas prices by $1.27 or 42%. That is a smaller percentage increase than the increase from $2.00 to $3 per gallon. We have not seen a decrease in overall gas use since that increase. Even with $140 per barrel oil, I don't think we would see much of a change in behavior. And that assumes we would see that price relatively soon.

Waiting for oil prices to do their magic is futile. That's why we need to start a certain road to much higher taxes starting now. The market will send signals, but they will be too late.


Also, we have to consider other sources of CO2 than just cars. Even if peak oil occurs, without a carbon tax why would coal based energy suppliers have incentive to reduce emissions?

Harvey D.

t may be right. Most of us will not buy more efficient hybrid vehicles until we are convinced that $3+/gal gas is here to stay.

Many more of us would buy efficient hybrids and even higher priced PHEVs if we knew that gas price would not only stay at current high price but would go up to $6+/gal (or average European price) with a combination of higher OIL price + a progressive carbon tax.

A carbon tax of a one to three cents per month per gallon would do it and give us enough time to change our behavior.


I’m not so quick to write off hybrids or raise taxes. Looking at the US Hybrid Sales 2004-2006 graph, it is a pretty good increase from 04 to 06 ("growth of 20% ain't too shabby").

Further, I believe that much of the lack of sales is due to erring on the side of horsepower rather than mpg. Compare the Toyota Camry sales in June 06 of 4,268 vs. Honda Accord sale of 396. To me the problem with the Accord hybrid is clearly combined mpg of 29 vs. Camry hybrid combined mpg. of 40 mpg.

The Toyota Prius is very well designed and fun to drive. Some people say, they haven’t enjoyed driving a car so much since they were a teen. That and 55 mpg combined for a midsize car, gets Toyota a 4 to 6 month backlog while selling cars at or near full price!

Regarding PHEV’s, I believe that if manufacturers begin to offer 100+ mpg. E85 Ethanol plug-in hybrid capability, and the customer has a choice of buying a 25 mpg. car or the 100+ mpg. PHEV, my guess is, they won’t be able to crank them out fast enough.

Yes, there will be learning curve objections, as there are with today’s hybrids. I still occasionally get the question, “How long will the battery last?”. My answer is that Toyota warrantees it for 8 years, and I believe it will last longer but I plan to trade the car before that, to take advantage of advancing automotive technology. And that’s one reason we haven’t associated with US automobiles in quite a while.



On principle, I am against any tax whose sole purpose is to alter individual behavior. We have enough market distortions already without adding more.

Besides, how could you counter the huge inflationary effects that such taxes would cause? We're having big problems with that now and you want to tack on another $3 per gallon. Not only would you be taking more money out of my pocket at the pump, but in the prices of the food I eat, among other things. We're already starting to tip into a recession because of oil prices, if you haven't noticed.

Not to mention that the effects of such an arbitrary tax are strongly regressive. Because poor people do own cars. How can I emphasize this enough? There are vast areas of this country where mass transit simply isn't possible. I just spent my vacation in northern New England, where this fact stood out starkly. You won't really hurt the wealthy with this, but the poor and the middle class would be seriously harmed by this tax.

Even the Democrats won't dare do anything to further raise prices with taxes. They have, in fact, proposed that current gas taxes be lowered and blame the Bush Administration for the current high prices.

For the record, I am not against fuel taxes for the specific purpose of paying for roads.

hampden wireless


Gas is not $1.27 based on $70 barrels. Gas is $3 around gallon based on $70 barrels as we all know. I assume you took $70 and divided it by 55 gallons because thats exactly how your numbers add up. Many people think there are 55 gallons in a barrel but in the oil industry its 42 gallons. Secondly not all of that becomes gas, some of it becomes diesel, jet fuel, wax, all kinds of stuff.

If oil doubled to $140 a barrel gas might not be $6 but it certainly wont be $4.27 You would see something like $5 to $5.50 as the only part that does not increase with the price of crude is the taxes. The refinaries and distributors seem to make price increases almost in line with cruise price increases.


Cervus, it sounds like you are a global warming skeptic. Is that correct? That's the only way I can make sense of your obection on priniciple. Or, do you have another suggestion that may hasten CO2 reductions?

Roger Pham

Rafael has good points in observing that hybrid volume of sale is still very insignificant, and that improvement in mpg across the spectrum of cars will contribute to fuel saving much faster. Indeed, we do see that sales of non-hybrid fuel misers such as the Honda Fit, Toyota Yaris, Kia ______, and Chevy Aveo are taking off like hot cakes! These are much more cost-effective than hybrids, including the Prius, with some increase in internal volume but at much heftier markup that is disproportional to the increase in size. But, any cars can benefit from hybrid technology, and this technology will be cheaper and cheaper with time and will trickle down to even to the smallest and cheapest cars, and we will really see how high fuel efficiency can get someday.

Furthermore, only a reassurance by the government at stabilizing the price of retail petrol at today's prices or even higher, will we see continual purchase of fuel-efficient vehicles, and consequently, more effort by the automakers in developing fuel-efficiency technology.

Notice I did not mention the politically-dirty word TAXation. The government does not have to raise the gasoline tax now, while gasoline prices remain high. However, the government must re-assure the public that the price of gasoline will be stabilized at a point that will continue to promote fuel conservation. This is not an act of punishment to the poor, but a salvation to our economy, which has been running a huge and growing trade deficit, and petroleum importation is a big percentage of this trade deficit. Pretty soon, we will run out of money to import petroleum, and the economic bubble will collapse, with catatrophic consequences to the poor, of course, while the rich will manage better to survive hard times. Cervus, are you among the poors, who can't afford any more taxes, or among the more greedy and apathetic affluents who just don't want to contribute anymore to our national causes? Anyhow, it does not matter what economic class u r in, you will benefit from the stabilization of retail price of petrol.


Just a note regarding poor people and cars. A carbon tax could be offset in all kinds of ways, for instance a reduction in payroll tax. It could also be used to fund better publick transport options and can be introduced quite gradually. Lastly the overall tax burden in the US is relatively mild (especially for rich people) so I can't really see that this kind of objection holds much weight.


Marcus: My stance on global warming is immaterial in this case. It's very simple. I believe in individual freedom and the power of the marketplace. The money I make is mine first. I did the work and earned it. Ergo, the government has no automatic right to it.

Roger: Cervus, are you among the poors, who can't afford any more taxes, or among the more greedy and apathetic affluents who just don't want to contribute anymore to our national causes?

If I want to contribute, I can choose to invest my money into venture capital firms or buy stock in companies involved in developing products that have lower impacts on the environment. It's a pity GreenFuel Tech is still a private firm, else I'd invest! I think algae holds great promise as a total replacement for transportation fuels. But if the government must help things along, I prefer tax credits or abatements to make the initial capital costs lower, rather than imposing more gasoline taxes on the other end.

The fact is that I don't want the government involved more than is necessary. Especially when they want to take more of the money I earned out of my pocket. Because when you involve taxpayers rather than keeping the risks with a few isolated investors, you not only make how the money is spent a political issue, you also put the taxpayers at risk should the venture fail.

And now I've drifted this way off topic. Oh well.

At any rate, just looking at the state of increasing hybrid sales and the still-dropping sales of large pickups and SUVs, I'd say the market is working well enough anyway.


Rafael at al:

I have very strong impression that your passionate call for carbon/fuel taxes in US is fruitless. See, US society and way to govern it varies significantly from what is common in European countries. As a nation US was build on the idea of personal freedom, and first of all from oppressive government, first of all its own. That’s why ability of central government is notoriously limited to provide some essential services, not to force some ideology, way of life on the people. Taxes are supposed to pay for essential services, not to merely modulate people’s behavior (with some exemption to “sin taxation” of gambling, smoking, or drinking). All legal and federation systems is built on this idea. American legal system alone would not allow to impose carbon/fuel taxes significant enough to be qualified as behavior modulating, let alone voters, who are very government-suspicious (down to the origins of Second Amendment). Government can ban something (like leaded gasoline), it could promote something (HEV incentives), but it could not to discourage something which is not prohibited as illegal (driving SUVs).

For better or worth, this personal freedom of choice emphasis of US socio-political fabric (and Canadian, Australian, and New Zealand’s to that matter) helped to avoid such behavior-alerting government-driven extremities as fascism, nazism, communism; America never saw any kind of dictator, let alone totalitarian state.

Sure thing, some adjustment to fuel taxation could take place to reflect hidden cost of motoring, help develop public transportation, and alike, but this would be not nearly enough to “get peoples out of their cars”.

Happy 4-th of July to all our American friends.

Rafael Seidl

Andrey -

"[...] some adjustment to fuel taxation could take place to reflect hidden cost of motoring [...]"

This is precisely my point. The way you externalize the hidden costs (military protection of access to oil, global warming, urban sprawl etc.) is by making fuel more expensive. This should be compensated for by reducing marginal income taxes, especially for the poor, precisely to avoid a more regressive situation. That way, you can EARN yourself a net tax cut by using less fuel than the average Joe.

I realize that US citizens are deeply sceptical of government, esp. the federal one. Many feel they have no control whatsoever over any money that goes to Washington. It was not always so: up to the early 60s there was still a much higher level of trust in public institutions.

What changed? TV advertising drove the costs of political campaigning into the stratosphere and broke up party discipline. By now, members of Congress are noteworthy mostly for their ability to gerrymander district boundaries and raise money for their re-election (98% incumbency rate). Thus, there is now a huge discrepancy between the ideals enshrined in the Constitution and political reality. Voters are staying away in droves, leaving extremist ideologues on both sides to dominate the agenda and completely ignore the general public in-between elections.

And that is why, unfortunately, it is so difficult even on a forum such as this, to advocate a simple measure designed to promote alternative technologies and help the US wean itself of its addiction to oil - without anyone getting a free ride.

Bill Young

The government's role is to guide the society for the common good (at least on a good day). The US is 6% of the world population and emits over 30% of the world's CO2. If you believe that global warming is detrimental to society, as I do, the government ought to have policies to reduce global warming.

The US light duty vehicles emit 10% of the world's CO2. Coal burning in the US for power generation emits another 10%. A carbon tax (if set at the right level) would influence LDV purchase decisions and new power generation decisions.

A carbon tax is highly regressive (disproportionately affects the poor). One possible remedy would be to evenly and directly distribute the carbon tax revenue among the citizenry.

Heiko Gerhauser


your figures seem wrong:

US light duty vehicles are less than 5% of worldwide fossil CO2 emissions.


And US CO2 emissions were around 23% of worldwide CO2 emissions in 2003:



Cervus writes:

I believe in individual freedom and the power of the marketplace. The money I make is mine first. I did the work and earned it. Ergo, the government has no automatic right to it.

I notice that Cervus doesn't say anything about the hundreds of billions of dollars the government spends to protect his (and the world's) access to oil.  That's what, between a buck-fifty and three bucks a gallon these days?  It also doesn't include the costs of pollution from oil; all the filtration of drinking water and such comes out of a different budget, usually that of the victims.

Cervus, a proper Libertarian is for self-responsibility, not playing the role of the grasshopper to the ant.  You demand rights without taking on any of the burdens, and that's both wrong and counter-productive.

It's my own small-l libertarian tendencies which force me to support more fuel taxes, to the tune of several dollars per gallon (I'd go for another $3 over the next 5 years).  You can call it social engineering if you want; I call it taking personal responsibility and waging economic warfare against the hostile petro-states.


Hampden. My bad. Ok. $70 divided by 42 is $1.66. Don't know why I was thinking 55. Obviously, the refiners will increase their prices on gas sold to distributors because of the oil increase. But you are implying that they will pass on a price that represents the percentage, not the gross price of oil. Do you have documentation for that? I'm not saying it's not true, it's just that I am interested in seeing the reference.

Even with your estimate of $5 to $5.50, we're still talking about a doubling of oil prices. The point still stands, I think, that we need the certainty that prices will rise to a very high level and stay that way.

Maybe oil prices will triple, for all I know, in the next couple of years. The problem, however, is that there are still a lot of people that think that the current oil prices are merely a spike or a bubble if you will. While I believe in the long term validity of peak oil, I can see that we could still have temporary reductions in oil prices assuming that part of the high price now has to do with transient factors beyond the inability to pump more oil.


Cervus and Audrey,

it is interesting that your attitude is what I and many other people think is really right at the core of the whole current crises (as Rafael points out). I wonder whether you would mind partaking in a little more discussion of it (not trying to sound offensive or confrontational here). For instance could you explain how laws that the government make are different to taxes designed to alter behavior - (especially if the money taken is given back in other ways)? Also, when one person's freedom impinges on another who should win? Should Americans have the freedom to cause global catastrophie? Lastly why do you believe in this principle and do you think holding on to this principle is more important than stopping global warming?

The principle I am talking about is that taxes should not be designed to alter people's behavior.

Thanks for any comments.

Bud Johns

Lots of good comments. Here's a quick twist, yes we need to cut down on CO2. How come nobody talks about the deforestion of the tropics? I mean trees and plants breath CO2 a exhale oxygen..........

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